With each day bringing ever-gloomier financial and economic news for the Eurozone and especially for Greece, Spain and Italy – bailouts, euro meltdown and the dreaded “spread” – this would not seem like the best time to start a company. Certainly not in a highly-speculative sector with few established precedents and even fewer proven business models. And yet the Italian startup scene is showing signs not only of life – but even of optimism and an excitement that flies in the face of the impending doom nearly everyone assumes is about to befall the Bel Paese (the Beautiful Country, Italy – not the cheese, of course).
Special report by Robert Dennis of the Milan Business English Network
Last month’s issue of Italian business magazine Capital featured on its cover Federico Marchetti, the founder and CEO of Yoox, the innovative online fashion retailer and the headline “Invent the future: How to become an e-commerce leader and beat the crisis”. Yoox is one of a crop of successful Italian startups that are bucking the downward trend in adverse business conditions – and providing an alternative vision for an economy in crisis.
In an upbeat feature article the magazine also described the recent visit of Corrado Passera, Mario Monti’s Minister for Economic Development and former CEO of banking group Intesa Sanpaolo to H-Farm, the Venture Incubator whose headquarters is located near Treviso in the lush countryside of northern Italy’s wealthy Veneto region. With an atmosphere that was ‘almost a happening, with an air of optimism and so much positive energy that it felt surreal, considering the times we are in’, the minister listened to the ideas and concerns of the audience of 200 mainly young entrepreneurs. The purpose of the event at the countryside retreat and embryonic tech hub, founded by Riccardo Donadon and Maurizio Rossi, was to send out the message that the Italian government is serious about its plans to support and incentivize startups. It aims to do this by working closely with industry figures who can bring their knowledge and passion to help foster the right environment for young businesses (especially high-tech ones) to grow.
The visit was the highlight of the Open Day (May 26) organised by StartUp Italia, an independent association formed by six leading players from the startup sector to promote innovation in Italy’s digital economy. The founders of StartUp Italia – Riccardo Donadon, Giorgio Carcano, Paolo Barberis, Luca De Biase, Enrico Pozzi and Mario Mariani – are also part of the 12-strong Startup Task Force assembled by Passera to identify the practical measures needed to create a favourable environment for startups in Italy. (The Task Force, whose other members are Selene Biffi, Annibale D’Elia, Alessandro Di Camillo, Massimiliano Magrini, Giuseppe Ragusa and Donatella Solda-Kutzmann is co-ordinated by Alessandro Fusacchia, Adviser to Minister Passera for European Affairs, Youth, Merit and Innovation.)
The recommendations of the Task Force will feed into a proposed package of legislative measures also to be called Startup Italia. This package of new laws will complement the existing government “decrees” of Save Italy, Grow Italy and Simplify Italy (Salva Italia, Cresci Italia and Semplifica Italia). However, it should be noted that Italians will be choosing a new government in 2013, which could have an impact on the existing legislative framework.
Capital’s article also focuses on how Italy’s main Venture Capital funds are continuing to invest in startups despite of – or even because of – a generally unfavourable outlook in the wider economy:
• Startups that are not yet ready for investment can be nurtured by incubators such as I3P, Innovation Factory, Toscana Life Science, TechNest (University of Calabria), Polo Tecnolgico di Navacchio, Consorzio Arca (University of Palermo), Acceleratore d’impresa del Politecnico di Milano and the Technopolis (University of Bari).
• Budding startups that require seed capital of less than 1 million euros can then approach investors such as dPixel, Working Capital, Italian Angels for Growth, Annapurna Ventures, Enlabs, Digital Magics, Club degli Investitori and H-Farm itself.
• Early stage venture capital of more than 1 million euros is provided by funds that include Principia SGR, Innogest, 360 Capital Partners, Vertis, TT Venture/Fondamenta, Next Fund Lifescience, Atlante Ventures and Aladin Venture/Friulia.
Italian banking groups UniCredit and Intesa Sanpaolo (via its StartUp Iniziative) also invest in startups.
Another sign that Italy is being taken seriously as a good location for startup companies is the arrival of TechCrunch in Rome this autumn. A one-day conference on September 27th will bring together the leading lights of Italy’s digital media and technology sectors. The event will throw a spotlight on some of the country’s highly innovative and dynamic startups.
So, while the outlook for the economy as a whole may be grim at least there is a ray of hope in the form of some exciting and creative new ventures that could kick-start growth as well as provide a significant return on investment for those with a longer-term vision.