Corporate Venture Capital (CVC) has steadily become a feature of Italy’s innovation landscape in recent years. Although still a small segment within the wider venture capital sector, CVC investments have been increasing as Italian corporations seek to engage with startups. The motivations behind these investments are varied – ranging from gaining access to new technologies and markets to building a competitive edge. This trend aligns with a broader global movement where corporates look beyond their internal R&D departments to source innovation externally.
Growth of CVC investment in Italy: current statistics
According to the report produced by InnovUp, Assolombarda, with the scientific partnership of InfoCamere and the Digital Innovation Observatories of the Politecnico di Milano and with the support of Area Politiche per il Digitale e Filiere, Scienza della Vita e Ricerca di Confindustria with Fondazione MAI and Piccola Industria Confindustria, there are currently around 5,300 startups and innovative SMEs that have received investment from Corporate Venture Capital. This represents approximately one-third (33.2%) of all innovative startups and SMEs in the country. While the proportion of CVC-backed companies has been steadily increasing (32.0% in 2023 and 31.2% in 2022), the overall share remains relatively modest when compared to other investor categories.
Among these 5,300 companies, about 4,000 are startups – showing a slight decrease from 2023 – and the remainder, approximately 1,300, are innovative SMEs. Despite this growth, the dominant source of funding for innovative firms in Italy remains from “Family & Friends”, who finance almost 9,500 companies, representing 59.7% of all investments.
Meanwhile, specialised investors, who have generally been a more consistent presence, are the only category seeing growth in terms of the number of startups and SMEs they invest in, surpassing 1,000 such investments in 2024.
CVC’s share of the market
Corporate investors now hold stakes in over 28,000 companies, representing 21.1% of the total 133,000 stakes across all investor types in Italy. The vast majority (94.7%) of these investors are corporate entities, with around 13,800 corporate investors actively involved in funding these ventures.
The financial impact of CVC investments is also notable. Startups and SMEs funded by corporate investors contribute €5.3 billion in production value, representing 47.2% of the total production value generated by all innovative companies in Italy. This share has grown from 45.6% in 2022, suggesting that CVC-backed companies are increasingly driving value within the ecosystem. By comparison, firms funded by Family & Friends account for 35.6%, while specialised investors hold 14.4% of the market share, indicating their growing influence.
A focus on early-stage companies
In 2024, the number of CVC-backed startups and SMEs remains stable, though there is a general decline in the total number of innovative companies. A shift is observed in the size of the companies receiving investment: the capital invested is now more focused on medium-to-large enterprises, with nearly €24 million more invested in the last year.
This trend reflects a gradual change in corporate investment strategies. Although micro-enterprises are still receiving attention, the largest increases in capital are flowing towards more established companies. It is worth noting that this shift does not necessarily indicate a reduction in interest in early-stage ventures, but rather a recalibration of priorities in line with evolving corporate needs.
Sectoral focus of corporate investors
The sectors that attract the most CVC attention are consistent with global trends, with 42% of corporate investors coming from the non-financial services sector, including industries such as transport, ICT services, and professional scientific and technical services. Financial services and software companies are also notable contributors, representing 20.6% and 10.9% of the investor base, respectively.
Many non-financial services corporate investors focus on startups within their own sectors, with investors in the software and IT industries particularly concentrated in their own field. In contrast, industrial investors tend to diversify, with investments spread across software, IT, industry, and research and development, highlighting a strategy that balances sector-specific expertise with broader diversification.
CVC investment patterns show strong inter-sectoral dynamism. A significant 81.7% of corporate investors are backing startups in sectors different from their own, underscoring an interest in external innovation. However, there has been a decline in inter-regional investments, with only 24.5% of corporate investors backing startups located in other regions, a drop from 30.2% in 2023. This trend may point to a preference for more localized investments or a reduction in the willingness to take on the complexities of cross-regional ventures.
Strategic shifts and ongoing challenges
Italian corporations are increasingly refining their investment strategies, shifting focus towards early-stage startups either within their own sectors or in adjacent industries. This strategic focus indicates a growing recognition of the long-term value such startups can provide in terms of innovation and market expansion.
That said, challenges remain. One of the most significant obstacles is aligning the strategic goals and corporate culture between the larger corporate investors and the startups they back. Cultural differences, differing growth paces, and the complexities of governance can create friction, making it difficult to realise the full potential of these investments. Companies that can effectively manage these challenges and build productive relationships with startups will be better positioned for long-term success.
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The full report (in Italian) is available at the following link: https://osservatorio-openinnovation.it/