The Italian fintech market is estimated to be worth € 882 million in 2022.
According to PwC’s study “5th PwC Italy FinTech Observatory”, investments in fintech led by venture capital funds grew by 240% compared to 2021.
The mega-rounds made the difference between 2020 and 2022 (fundraising over € 50 million). The mega-deals were led by non-Italian venture capital funds investing in Italian startups that scale faster and adopt distinctive business models that are less exposed to competition.
The most important Italian deals of 2022
Bank Aidexa is a fintech dedicated exclusively to financing SMEs and VAT holders. In August 2022, it closed a €12 million round after previous seed and bridge rounds (total capital raised equal to €48 million) led by 360 Capital Partners, Bertoldi Holding, Banca Sella, Gruppo Generali, Mediocredito Centrale, among others.
Young Platform, founded in 2017 at I3P, the incubator of the Politecnico di Torino, is one of Italy’s first cryptocurrency trading platforms. In June 2022, it raised € 16 million in a round led by Azimut and the DAO fund of Swiss digital bank Sygnum AG and in which SBI participated, Banca Sella and United Ventures.
Satispay is a scaleup that created a mobile app for digital payments. In September 2022, it raised € 320 million in a round led by Addition and also underwritten by existing shareholders such as Greyhound Capital, Coatue, Lightrock1, Block Inc., Tencent and Mediolanum Gestione Fondi SGR, from which it had received € 156 million in funding in four different rounds between 2018 and 2020.
Scalapay, founded in Milan in 2019, is a scaleup that has developed a third-party payment solution based on the “Buy Now Pay Later” model. After raising € 174 million in 2021, in May 2022, it closed rounds for € 486 million from international investors such as Tencent, Willoughby Capital, Tiger Global and others (Poste Italiane invested € 27 million, and the Addition fund 320 million).
However, net of these mega-rounds, the capital raised in 2022 would only amount to € 76.2 million, which is 11% lower than the amount invested by operators in 2021 and would represent a CAGR of 16.9% over the period 2017-2022.
The business models of fintech companies have evolved substantially in recent years. While initially, companies only offered themselves as an alternative to the traditional financial system (banks, insurance companies, investment managers), today, many startups operate as symbiotic partners for financial intermediaries.
This market situation has favoured the emergence of numerous fintech startups (more than 600 companies active in Italy in 2022); it has also generated operators that are sometimes not very distinctive.
The PwC report then analysed the trends of some categories of the fintech macro-sector.
In digital payments, a transformation is underway, with traditional instruments/services converging towards a completely new offering in business models. The steady increase in new entrants also confirms its dynamism: in 2021- 2022, 59 operators are authorised in Italy, 30 of which are non-banking.
Concerning loans, the report underlines an important development in loans granted to businesses, especially small and medium-sized companies. As a result, financing in the first half of 2022 exceeded € 2 billion (+49%).
Analysing the insurtech data, after the accelerated growth of the past few years in terms of the number of active startups, the insurtech sector started to decline in 2022. Two main reasons have been identified: the decrease in financial investments in insurtech solutions by traditional insurance companies and the strengthening of active players in the market. However, despite the downturn, customer service is improving and specialising.
The study also certifies that 79% of Italian fintech startups are in northern Italy. In this regard, Milan is confirmed as the Italian fintech capital. Furthermore, Milan is home to 54% of fintech companies nationwide and concentrates 70% of investments, confirming its role as a financial centre for the market.
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For more info (in Italian) visit: https://cloud.email.pwc.com/osservatorio-fintech-2023