IAG Business Angels Increase Focus on Italian Startups at Seed and Pre-Seed Stage

The positive trend of Venture Capital in Italy (+67% compared to 2021) is also reflected in the data emerging from the IAG Index 2022, a thermometer of the startup ecosystem and calculated on the broad deal flow of startups analyzed in the selection of investment opportunities by Italian Angels for Growth (IAG).

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The focus on seed and pre-seed

While the breakdown at the sector level has remained roughly similar to 2021 (except for a slight redistribution between Life Science and other sectors), the picture that emerges from the data on the type of round well reflects IAG’s positioning as a leader in seed Venture Capital in Italy.

The gradual maturity of Italian and international Venture Capital in fact has made the roles of the various players more defined for each stage of startup development, and this has allowed IAG to focus on the seed stage, which, despite a slight decrease in the figure, remains the main focus of business angels.

More than one in two of the startups analyzed are raising capital for this type of round, representing strategic investments to feed the pipeline of potential scaleups.

However, the IAG Index 2022 highlights a remarkable growth (+47 percent) in the number of startups in the pre-seed stage. The reason for this result is in IAG’s choice as a club deal to bring the focus back to the early stages of project development, thanks to the launch of Eden Ventures.

Last October, in fact, the Eden Ventures program started (here is the article on Crowdfunding Buzz), an investment tool focused on pre-seed startups with the goal is to intercept the best investment opportunities at the origin and supporting entrepreneurs from the development of the business idea to the approach with institutional investors with tickets up to €100,000.

Comparison with other countries

In the past year, the national startup ecosystem has made numerous steps forward, both in the area of legislation and in building a system to support and grow innovative companies: the mobilization of public funds has created a leverage effect, reducing the gap with other European countries in investment.

Confirming the progress of the Italian ecosystem, the valuation of startups in all their life stages also shows a marked increase, bringing them closer to those of other ecosystems that are now much more mature than ours.

The gap remains, on the one hand creating conditions of attractiveness for foreign investors, but on the other hand, also allowing Italian startups to be able to obtain funding and valuations that are not too penalizing compared to their colleagues from across the border.

Diversity, inclusion, and sustainability

The Diversity & Inclusion theme remains a key driver and, in this regard, IAG continues with initiatives to enhance these two principles, pursuing the diversity campaign and creating partnerships with territorial and sectoral realities to develop a more innovative, fairer, and more sustainable society.

The 2022 results, although slightly down from 2021, confirm that more than one-third of the projects have at least one woman among the founders: this consolidation indicates a now structural component of the female presence in entrepreneurial teams, representing a definite shift in our ecosystem.

Sustainability and the social element are also central issues when evaluating a startup: investing in companies that incorporate ESG values represents a great opportunity

Precisely to increase sustainable investing, last November IAG joined VentureESG, a VC community that unites more than 300 funds worldwide with the ‘goal of helping the venture capital industry recognize the importance of ESG and provide and share resources and guidance to make ESG a standard part of due diligence, portfolio, and fund management.

In line with this, the 2022 data shows a significant 25 percent increase in the number of compliant projects. In evaluation, the ESG element is viewed positively by IAG, which considers this aspect increasingly indispensable for companies that are to be the market leaders of the future.

Carlo Tassi, President of Italian Angels for Growth: “IAG’s role as a leader in seed Venture Capital is to be on the side of entrepreneurs, contributing to their success and concretely supporting innovation and startups in this country, hence the increasing attention to the elements of team diversity and ESG compliance. The IAG Index proves to be a valuable indicator to measure market trends and perceive in which direction innovative startups are going and how our ecosystem is evolving.”

What is Italian Angels for Growth (IAG)

IAG, founded in 2007, is a leader in Italian Seed Venture Capital: more than 500 players from the entrepreneurial, financial, and industrial worlds who invest time, skills, and capital for the growth of innovative startups, that have come and gone over the years.

Italian Angels for Growth, in more than ten years of activity, has analyzed more than 6,500 startups and its members have made more than 100 investments, for a total of more than €300 million invested by IAG members and co-investors.

IAG’s business angels financially support innovative projects by investing their own capital, but at the same time, thanks to the mix of member expertise, they support startup founders in defining the business model in all its aspects.

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(Featured image by StartupStockPhotos via Pixabay)

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

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