 | Back in July 2013, Italy was the first country in Europe to adopt a specific regulation for equity crowdfunding. The set of rules, which we described extensively in this post, allowed only the so called innovative startups to raise capital through online portals. |
According to recent estimates, one year and half after the release of crowdfunding rules, only 4 businesses have successfully raised capital from retail and professional investors through equity crowdfunding portals. This is indeed a small figure compared to other EU’s markets. Many Italian crowdfunding stakeholders blamed above all the aforementioned legislation to be the reason of such a limited result. In particular, they said the requirements for a company to be eligible for online capital raising are very stringent, thus leaving out most of SMEs.
However an important news has arrived last week. The Italian government has in fact released an additional law which extends the possibility to use equtiy crowdfunding as source of finance also to “innovative SMEs” that is firms with less than €50 million annual turnover and that respect at least one of the following three requirements:
The new law also allows early stage investing funds to seek capital through crowdfunding portals. This way, retail investors will have a further chance to build a good portfolio of early stage investments, exploiting the expertise of established investors.
The new rules will enter into effect in about sixty days and Italian lawmakers expect they will improve SMEs’ access to finance, while at the same time encouraging R&D and innovation. Hopefully this will also gear up the crowdfunding market in the Country, but we will evaluate the effects later in the year.
References
Pennisi, M. (2015). L’equity crowdfunding apre alle Pmi innovative: ecco i criteri da rispettare. Smartmoney.
However an important news has arrived last week. The Italian government has in fact released an additional law which extends the possibility to use equtiy crowdfunding as source of finance also to “innovative SMEs” that is firms with less than €50 million annual turnover and that respect at least one of the following three requirements:
- 3% of either sales or costs (whichever the biggest) attributable to R&D activities.
- one third of employees has a degree or one fifth of the employees are doing or have done a doctorate program
- the company owns a patent.
The new law also allows early stage investing funds to seek capital through crowdfunding portals. This way, retail investors will have a further chance to build a good portfolio of early stage investments, exploiting the expertise of established investors.
The new rules will enter into effect in about sixty days and Italian lawmakers expect they will improve SMEs’ access to finance, while at the same time encouraging R&D and innovation. Hopefully this will also gear up the crowdfunding market in the Country, but we will evaluate the effects later in the year.
References
Pennisi, M. (2015). L’equity crowdfunding apre alle Pmi innovative: ecco i criteri da rispettare. Smartmoney.
 | About the author - Irene Tordera Born and raised in Milan, Italy, Irene is an International Business graduate, with a strong interest for innovative ideas that can simplify our lives. During her studies, she co-founded an online community for sportspeople and worked in marketing positions at Ogilvy & Mather Advertising and at the European Business Angel Network, in Brussels. She is a passionate blogger about crowdfunding and the startup ecosystem. |
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