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Crowdfunding

The crowdinvesting race continues in Italy

Looking at the online raising of venture capital, in the last 12 months the equity crowdfunding sector in Italy has raised $88.4 million (€76.6 million) (+56% compared to the previous 12 months) for a total of about $183.4 million (€159 million). With $362 million (€314 million) collected in the last year, lending crowdfunding reached $867 million (€749 million).

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Crowdinvesting (a subset of crowdfunding that allows both individuals and institutional and professional investors to join, through an enabling Internet platform, the collection of resources for an entrepreneurial project) continues to grow at record rates in Italy.

In the last twelve months, funds disbursed amounted to $451 million (€391 million), bringing the total (data updated to June 30th, 2020) to $1.04 billion (€908 million), almost double the $597 million (€517 million) of last year, when the numbers had already doubled year on year, both on the equity and lending front. 

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In terms of volume, Italy lags behind other European countries

However, even though Italy’s growth rates are in line with the rest of Europe, there remains a large gap in terms of volumes. That is according to the results that emerged from the 5th Italian Report on Crowdinvesting carried out by the Observatory of the School of Management of the Polytechnic University of Milan presented on July 21st. During the virtual event, three panels were presented, dedicated respectively to equity, lending, and real estate.

“Market funding and investment flows do not seem to have been impacted by the crisis, and indeed – in some respects – crowdinvesting has been re-evaluated as a ‘rapid’ source of liquidity for businesses, in the face of the slowness of public and banking bureaucracy,” the report highlighted.

The Equity crowdfunding sector

Looking at the online raising of venture capital, in the last 12 months, the equity crowdfunding has raised $88.4 million (€76.6 million) (+56% compared to the previous 12 months) for a total of about $183.4 million (€159 million). 42 portals were authorized on June 30th, 2020 with 193 campaigns in the last 12 months alone out of a total of 595 and an average collection target of $222,088 (€192,481) for non-real estate projects and $928,725 (€804,914) for real estate. 

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Looking at the platforms that operate in this segment, Mamacrowd is at the top of the ranking with $39.17 million (€33.93 million) collected in total in its campaigns, followed by Crowdfundme, which rises to first place if we consider the collection in the last 12 months, equal to $15.91 million (€13.78 million).

The crowdfunding lending sector

With $362 million (€314 million) collected in the last year, lending crowdfunding reached $867 million (€749 million). Specifically, loans to individuals (consumer lending) reached $473.3 million (€410 million) ($155.4 million (€134.6 million) in the last year) while those to businesses (business lending) reached $391.4 million (€339 million) ($207.4 million (€179.6 million) in the last year). 

Among the 6 platforms that operate in lending to private individuals, thanks to funding from foreign institutional investors, Younited Credit ranks first with $377.6 million (€327 million) disbursed $127 million (€110 in the last 12 months). In lending to businesses (segment in which 11 platforms operate) Credimi Futuro, Borsadelcredito.it and October are on the podium, with a total cumulative volume of $391.6 million (€339.2 million), of which $207.3 million (€179.6 million) were added in the last year.

The exploit of real estate crowdfunding

With $22.5 million (€19.5 million) collected from equity platforms and $33.7 million (€29.2 million) from lending portals, real estate crowdfunding was up 185% on the previous period. The number of players continues to grow with 10 dedicated active platforms (there were 6 in 2019 and only 2 in 2018).

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First published in WE WEALTH, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

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Valerie Harrison is a mom of two who likes reporting about the world of finance. She learned about the value of investing at a young age upon taking over her family's textile business when she was just a teenager. Valerie's passion for writing can be traced back to working with an editorial team at her corporate job, where she spent significant time working on market analysis and stock market predictions. Her portfolio includes real estate funds, government bonds, and equities in emerging markets such as cannabis, artificial intelligence, and cryptocurrencies.