While funding for Italian startups has been rising, the nation nonetheless ranks eighth in Europe by VC funding, in line with Dealroom.
Newly created Italian Founders Fund (IFF) hopes to assist with the catching up, each in amount and in high quality. With €50 million to speculate into 25 firms, it additionally positions itself as a sector agnostic, founder pleasant fund that understands the ache factors of entrepreneurs.
IFF’s portfolio already contains 4 firms, with a fifth deal within the works. Two have been disclosed to date: Before buyer analysis platform Glaut in April, IFF led a 2023 spherical of funding into HR tech startup Jet HR.
“IFF is addressing the challenge for early stage founders in Italy to find a high conviction lead investor at the pre-seed and seed stages,” IFF founding associate Lorenzo Franzi (third from the proper within the image above) advised TechCrunch.
Some might disagree with the analysis; VC corporations that function in Italy already embody CDP Venture Capital, Exor Ventures, LVenture Group, Milano Investment Partners, Pariter Partners, Primo Ventures, and United Ventures.
Franzi, nonetheless, thinks that this nonetheless leaves a spot for early stage capital. And both manner, IFF comes up as a brand new supply of capital for a market whose startups collectively obtain far much less funding than France’s, as an example, even if the 2 international locations have the same inhabitants measurement.
IFF can also be a complement to accelerators similar to H-FARM, and a step up from the angel investing that Franzi and different entrepreneurs turned backers had been partaking in.
A former CEO at laundry startup Laundrapp turned associate at Global Founders Capital till late 2022, he stated that the “unstructured” method inherent to angel investing can result in a number of points similar to restricted evaluation, complicated cap tables, and undersized funding rounds. IFF can convey the construction of a fund to its funding course of, but in addition be hands-on after it invests.
For occasion, IFF was in a position to assist portfolio firms with key hires, business growth, and strategic partnerships, Franzi stated. Jet HR CEO Marco Ogliengo concurred, noting that IFF’s value-add comes from the truth that it’s “backed by basically every successful Italian founder.”
That could also be hyperbole; however in line with Franzi, round 100 of IFF’s backers are certainly Italian entrepreneurs. He added that they arrive from a variety of generations and sectors, however with a shared objective: to place Italy on the map of the very best spots in Europe to open an organization.
That’s an bold objective, particularly since a few of the ache factors are out of IFF’s remit: There’s not a lot a non-public VC agency can do to counterbalance excessive taxes and paperwork. There have been newer public efforts to spice up the nation’s attractiveness and its tech sector; however in contrast to CDP Capital, which is backed by state businesses, IFF is solely privately funded.
In absence of public funding or institutional LPs, IFF is free to speculate wherever it sees match. It will use this geographical flexibility to additionally again Italian founders working overseas, in addition to overseas startups desirous about coming into the Italian market.
Foreign connections go each methods, with IFF aiming to get overseas VC funds to co-invest in its portfolio, both initially or in follow-on rounds. It may even assist that a few of its LPs are GPs of overseas funds, and that it plans to again Italian founders with international ambitions.
Global Italian startups embody Bending Spoons, the proprietor of well-liked apps and companies like Evernote and Meetup, which is valued at $2.55 billion. And with serial Italian entrepreneurs returning house to discovered their subsequent ventures, it appears becoming that they now have a founder-led fund to again them.
IFF can be managed by KOINOS Capital, a non-public fairness fund that has been increasing into VC, and whose CEO, Marco Morgese, famous examples of founder-led funds in different markets, similar to Founders Fund in…
