This phenomenon is extremely significant for the Italian startup ecosystem, which is showing great potential and proving its ability to attract foreign capital. In fact, Italian startups boast excellent talent, technical expertise, and a remarkable ability to adapt—qualities that increasingly attract international investors in search of promising new opportunities. This represents a great opportunity, but it also brings important challenges. In the past, foreign VC funds focused mainly on established Italian companies in advanced growth stages, the so-called scale-ups that had already made a name for themselves in the Italian market and were ready for international expansion. In recent years, however, this approach has shifted. We are now seeing more international funds enter the Italian market, investing even in early-stage startups, often as early as the pre-seed stage.
Securing investments from foreign funds doesn't just mean gaining access to capital but also acquiring expertise, networks, and valuable strategic support for international expansion. The interest of foreign funds brings with it know-how that enriches the founders’ experience, offering new perspectives and essential skills to compete globally. Additionally, when foreign funds invest in Italian companies, founders are no longer competing solely with local businesses for funding but are now contending with the entire European landscape, thereby raising the level of competition and the required quality. This support can make a significant difference in transforming local companies into global players. With the right preparation, Italian startups can fully leverage these opportunities, expanding their horizons beyond national borders.
The future of Italy's startup ecosystem looks promising. In the past year, several Italy-based startups have attracted the attention of international VCs, supported by both private and government initiatives. A portion of the credit goes to the International Fund of Funds (FoF) of CDP Venture Capital, which, over the past year, has invested in some of the leading foreign funds, including Join Capital, Earlybird, Seroba, and Partech. CDP's investment in these funds represents a significant opportunity for Italian startups, as these foreign funds are incentivized to invest in Italian startups. In addition to allocating part of the capital raised to Italian startups, foreign funds are hiring staff with a specific focus on the Italian market to better understand local dynamics and identify the most promising opportunities. In some cases, the funds even choose to open offices in Italy, creating a physical presence that facilitates dialogue with the national ecosystem and makes it easier to monitor startups and support them directly. This approach not only brings capital but also strengthens the network and venture capital infrastructure in Italy. This year, we are starting to see concrete results: last month, Earlybird participated in Involve Space’s round, with a €2.5M investment, alongside Takeoff, Unicredit, Fondazione CRT, and Plug and Play. Similarly, at the end of 2023, Partech invested €13M in Smartpricing, together with The Techshop SGR, Azimut Italia Digitech Fund, and the founders of Bending Spoons. The outlook for the coming years is promising, with a projected increase in foreign investments in our ecosystem. However, it will be crucial for Italian startups to continue innovating and strengthening to compete effectively on a global scale.
IAG has been moving in this direction, investing not only in Italian startups but also in international ventures, with a focus on global founders from day one. In recent years, the growing interest of foreign funds towards Italy has offered us the opportunity to further expand our horizon.
For this reason, over the past three years, IAG has set up a framework to select indirect investments to strengthen its international portfolio. We have chosen to collaborate with local funds that have deep expertise and strong roots in their respective geographical areas, in order to access quality deal flow even in more distant markets. Among the selected investments, for example, is Lombardstreet Ventures, which has allowed IAG investors to access deals in Silicon Valley, HEARTFELT_ for the DACH market, and Catalyst Investments to tap into the Israeli startup ecosystem.
But investments, both direct and indirect, are not the only way forward. With a similar goal in mind, since 2023, IAG has supported and hosted MiVC within its spaces —the first International VC Hub in Milan, designed to welcome foreign VC funds visiting Italy in search of investment opportunities. Many funds, when they come to Italy to meet startups, other investors, or even to enjoy the cultural and business scene of the fashion capital, often find themselves working from hotels or cafés, inevitably facing discomfort and logistical complications. To address these needs, since last year, MiVC has been offering a dedicated workspace in the heart of Milan's VC ecosystem, providing desks, phone booths, meeting rooms, and a vibrant environment alongside other VC professionals, so they can feel at home while benefiting from the convenience of local support and investors.
The results have been extremely positive. Since its launch on September 24, 2023, MiVC has already hosted over 40 international funds, and the count continues to rise. MiVC is not just a physical space but a symbol of Milan’s ambition to become a true reference point for the international venture capital ecosystem.
In conclusion, the interest of foreign VC funds in Italian startups represents an unmissable growth opportunity for the national ecosystem. By overcoming local challenges and taking advantage of the opportunities offered by international capital, Italian startups can become key players in the global innovation scene. The road ahead is still long, but over the past two years, we have demonstrated that promising Italian startups exist and that the interest from foreign funds is real. Now, more than ever, it is crucial that we are ready to seize these opportunities, creating the right conditions for Italy's ecosystem to grow and compete internationally. The potential is there, as are the talent and the capital: we just need to bring them together to accelerate change and make Italy a leading force in the European innovation landscape.