“Together with financial resources, another important ingredient of a thriving start-up ecosystem are entrepreneurs who are ready to engage in new projects,” stated Oecd in an assessment report of the Italian Startup Act, the policy including heterogeneous tools aimed at supporting innovative start-ups, effective from the end of 2012 (more here).
Let’s try to understand who are the Italian start-uppers and whether they have different characteristics than start-up founders from the rest of Europe, starting from Crunchbase data.
The first thing that we should stress is that, at least from a quantitative point of view, we have nothing to envy to the rest of the world: the Italian Register of innovative start-ups has recently recorded more than 10 thousand companies (we talked about it here) and therefore the pool of innovation from which VC and institutional investors can draw is increasingly broad and varied.
The educational background of start-up founders
Let’s see what happens from the point of view of quality. According to Crunchbase, only 10% of Italy’s start-up founders have a PhD, however this number is in line with European and global figures. Only Belgium and Germany differ significantly: they stand respectively at 18% and 15%. Start-uppers with an MBA master’s degree are around 7% in Italy, in line with the Netherlands and close to Sweden and Belgium, but far from Singapore (where they are over 20%), Spain and Israel; while in the USA they are around 18%.
What they did before, academics vs entrepreneurs
Worldwide there is a clear prevalence of start-uppers who come from a previous entrepreneurial experience – in every country they are over 20% – than those coming from an academic background, or having worked as professors, researchers or teachers – in all analysed countries these are less than 10%, only in Belgium they are slightly more. In Italy, serial entrepreneurs represent 24% of all local start-uppers, academics instead just 6%. Women who founded one or more start-up companies are 11%, slightly above the average.
Few students and very few inventors
However, young Italian entrepreneurs have two distinctive features: the percentage of student-entrepreneurs – that is, people who started their university studies less than four years before setting up their own company – and that of “inventors”, i.e. those who held a patent before starting their start-up company. Italian founders who are also inventors are 3% of all start-uppers, a significantly lower percentage than that of most other countries: for instance, Israeli inventors are 15%, American and Swedish ones are 13%. As for student-entrepreneurs, they are less than 5% in Italy, slightly more than in France and Spain, but less than in other start-up nations: Belgian, American and British ones are around 8%. In Israel they also stand around 8%, while in Canada they reache 10%.
OECD’s deduction is that Italy’s financing offer must be strengthened
Non è un caso infatti che per favorire il trasferimento tecnologico dell’innovazione, negli ultimi anni nell’ambito delle politiche di Industria 4.0 siano stati istituiti i cosiddetti Competence Center, enti pubblico/privati che dovrebbero agevolare il passaggio delle competenze da università a imprese per favorire la digitalizzazione. In sintesi, dunque, i dati analizzati, “suggeriscono che l’offerta di imprenditori innovativi non è molto diversa in Italia rispetto agli altri Paesi. Pertanto, l’esiguo numero di operazioni di venture capital in Italia sembra dipendere principalmente dalla mancanza di offerta di finanziamenti, piuttosto che da una mancanza di domanda in tal senso”. Ma anche su questo fronte dell’offerta le cose stanno cambiando e il futuro è sempre più roseo.
What do these numbers suggest? According to OECD, “the fact that both students and patent inventors are under-represented among start-up founders… may indicate a greater distance between the Italian university and research institutes, on the one hand, and start-ups and entrepreneurship in general, on the other”. However, something is changing. It is by no coincidence that in the last few years, in order to favour innovative tech, Competence Centres have been established in the context of “Industry 4.0” policies. These Centres are public-private bodies that should facilitate the transfer of talents from universities to companies, in order to favour digitalisation. In short, therefore, the analysed data suggest that “the offer of innovative entrepreneurs is not very different in Italy compared to other countries. Therefore, the small number of venture capital operations in Italy seems to mainly depend on the lack of financing offer, rather than a lack of demand in this sense”.
However, as we have recently pointed out, on the VC and financing front things are changing too. Indeed, the Italian venture capital market is growing and public actions are increasing. This is demonstrated, for example, by the joint CDP and EIF enterprise called ITAtech. Launched in December 2016, it collected an initial endowment of 200 million euros to be used for technology transfer, i.e. to promote, support, catalyse and accelerate the commercialization of intellectual property with high technological content and, more generally, the transformation of research outcomes into new business ideas. To date, four funds have been launched: Vertis Venture 3 Technology Transfer, which focuses on industrial leadership and societal challenges; Sofinnova Telethon, specialized in life sciences; 360-PoliMI, which focuses on advanced manufacturing, and Progress-TT, on sustainability. In short, the future of startuppers is getting brighter.