Italy, a young innovation ecosystem

Global venture capital investments reached $94.3 billion in the second quarter of 2024. The Americas contributed $58.3 billion, of which $55.6 billion came from the United States, while Europe attracted $17.8 billion and Asia $17.4 billion. Despite this, venture capital operations remained weak, particularly in Europe and Asia (KPMG, 2024).

Nearly ten companies obtained financing of over 1 billion dollars, more than double compared to the previous quarter. Artificial Intelligence continues to be the most attractive sector for investors, due to the high costs required by the development of advanced models and the interests of large technology companies. Regulation, such as the approval of the AI ​​Act passed by the European Union, is also taking a central role (KPMG, 2024).

In Q3 2024, venture capital investments are expected to remain stable, with AI and cleantech continuing to be priority sectors. The IPO market could also see a slight increase, but a significant recovery is only forecasted for 2025.

The startup ecosystem, which is growing strongly in Europe, is now valued at $60 billion in Italy. However, its development remains younger than in other European countries: Italy is at the stage where Spain was 3-4 years ago, and France 8 years ago, but is following a similar, or even a slightly more advanced, growth trajectory (Dealroom 2024).

Total venture capital investments, with reference to the first half of 2024 and considering Italian startups and foreign startups with Italian founders, reached €870 million, a +26% increase compared to the same period in 2023, despite a reduction in the number of funding rounds. This indicates a greater concentration of capital on a smaller number of operations, suggesting a more selective approach by investors (Intesa Sanpaolo Innovation Center, 2024).

In summary, the Italian venture capital market in 2024 shows signs of near-maturity, with a growing focus on the quality of operations and a more strategic distribution of capital, in line with global trends in the sector.

Looking ahead to 2025: fintech startups driving growth

In Italy, the digital assets market is expected to be much larger than in 2024, with a projected growth of +15.38% in 2025. The number of digital payment users is expected to reach 40.91 million by 2028. Key fintech trends include digital payments, online investing, digital fundraising, digital assets, and neobanks, with innovations such as artificial intelligence and blockchain driving growth (Statista, 2024).

Investing in fintech startups in Italy in 2025 represents a tremendous opportunity for investors. With the support of the National Recovery and Resilience Plan (PNRR, the Italian acronym), the fintech sector is set to be at the heart of the country’s digital transition. The €300 million fund for digitalization and innovation provides significant support to the growing ecosystem, enabling the development of new technologies and simplifying the management of operations for SMEs and consumers.

Despite the recent market correction, the sector continues to grow thanks to more prudent management and the search for sustainable profit growth. In Italy, this trend is evident, with digital assets markets expected to boom and the growth of digital payments and neobanks that are transforming the financial landscape.

In addition, key regions such as Lombardy are emerging as hubs for financial innovation, thanks to initiatives such as those of ICE SDA Bocconi, which serve companies active in different sectors that want to discover how to improve their innovation capacity, and its European FS Tech Hub, an innovation hub devoted to fintech, so as to support the development of the digital economy.

Investing in fintech therefore means not only participating in the digital transformation of the financial industry, but also supporting the economic growth of the country, while benefiting from a favorable regulatory and financial environment.