State of Italian VC: the report on the evolution of Italian Venture Capital

  • Impressive growth trajectory over the decade in terms of volumes, investments, the establishment of innovative companies, and its impact on the economy.
  • Approximately 8 billion euros invested in Italian startups over the past 10 years, reflecting a valuation of 67 billion euros in 2023.
  • Italian startups and innovative SMEs collectively generated a turnover exceeding 9.3 billion euros in 2023.
  • Investments in Italian startups reached €1.1 billion in 2023, with a notable increase in the prevalence of Growth Stage rounds.
  • In the last 5 years, VC fundraising activity in Europe totalled EUR 108.7 billion; although 2023 witnessed a decline (-32% YoY), Italy defies the trend with a notable increase (+88% YoY).

P101 has delved into the evolution of its sector over the past decade, scrutinizing specific trends and aligning them with the broader European landscape.

The report, titled “State of Italian VC,” shines a light on the impressive growth of Italian Venture Capital (“VC”) in the last 10 years, acting as a catalyst for the nation’s innovation ecosystem. From 2013 to 2023, Italian VC has injected a substantial 8 billion euros into startups, witnessing a remarkable surge from 152.1 million euros in 2013 to a staggering 1.1 billion euros in 2023. This growth, averaging an impressive 644%, outpaces the European average of 492.5%.

Over the same period, the number of completed transactions has risen from 294 to 387, marking a 31% increase, compared to Europe’s 80%. This hints at a notable upswing in the average size of Italian deals. Despite 2023 macroeconomic uncertainties causing a dip in investments (-55% YoY) and in number of rounds (-30% YoY) in 2023, in line with European trends (-43% and -21% in France and -37% and -19% in Spain), the overall growth trajectory of the Italian ecosystem (+644% over the decade) remains robust.

The burgeoning investment pace has also contributed to the growth of over 13,000 startups and around 2,000 SMEs in Italy. In 2023 alone, these entities generated a turnover of over 9.3 billion euros, employing approximately 62,000 people. The valuation of the Italian Startup ecosystem, standing at around 67 billion euros (Enterprise Value), has increased 25 times over the past 10 years, more than double the European average, with accelerated growth in 2023 recording a 27% YoY increase (7% in Europe). This growth underscores the scalability of business models and the emergence of entities with further development potential, particularly in the technology sector.

While the value of Italian startups in 2023 is comparable to Spain in 2020, France in 2016, and Germany in 2015, indicating a temporal gap in development, the surge in the number of VC-backed companies in Italy (from 726 in 2013 to 2,983 in 2023, a +271% increase) sets the stage for accelerated development. The average valuation of Italian startups in 2023 surpassed 22 million euros, recording the highest compound annual growth rate (+19%) of the decade. Countries like Germany and France still showcase average valuations nearly twice as high as those in Italy, which is still in the early stages of development. However, the data highlights an ongoing maturation process within the Italian ecosystem.

In the last 5 years, European VC funds have raised approximately 109 billion euros, experiencing a 32% decline in 2023 (YoY). However, Italy stands out with an 88% year-on-year increase, with 3.6 billion euros raised by new VC funds. In addition to that, 2023 also witnessed a notable 71% increase in the average size of Italian funds. Despite being in a growth phase, the Italian market lags behind more mature ecosystems. Nevertheless, the consistent increase in the number of new VC funds (from 3 in 2019 to 11 in 2023) and their increasing average size signal a deepening and diversifying market, reflecting growing investor confidence and a broader range of investment opportunities in the country.

We aim to conduct a comprehensive analysis to spotlight the remarkable journey undertaken by Italian Venture Capital and shed light on its potential for further growth,” remarked Andrea Di Camillo, Founder and Managing Partner of P101. “The overall growth trajectory over the past decade has been substantial, encompassing volumes, investments, the creation of innovative enterprises, and a significant impact on the economy. In 2023 alone, the 52 companies in which P101 has invested generated approximately 1.7 billion euros in revenue – contributing to a total of 5 billion over the decade – while providing employment to over 5,000 people. Industry insights affirm that the groundwork for the Italian Venture Capital ecosystem is now complete. We must look forward to the next decade, furtherly bridging the gap with leading European countries. More importantly, we must brace ourselves for the challenges the ecosystem will encounter as it evolves into a new phase of maturity, ushering in changing rules of the game. Opportunities and competition will escalate, with international players showing a growing interest in our country. Emerging drivers, such as Artificial Intelligence, will reshape investment trends, increasingly honing in on services for businesses. We expect an upswing in the sizes of funds, investments, and startups: companies that have thrived in the past decade now showcase the scalability of their business and stand poised for a dimensional leap that will frequently extend beyond borders. As Venture Capital players, our role is not just to navigate but to lead this transformative shift towards new business models, keeping in mind the core objective of the sector: contributing to the development of the Italian innovation ecosystem.”

The key trends on the evolution of Italian Venture Capital outlined in the “State of Italian VC” report by P101 with the support of Dealroom are summarised as follows:

Evolution of Rounds

Italian Venture Capital injected 3.7 billion euros into Early Stage rounds during the past decade, experiencing a fivefold increase from 102.4 million euros in 2013 to 515.5 million euros in 2023. Despite a 28% year-on-year dip in Early Stage investments in 2023, they continue to serve as the cornerstone of Italian VC, constituting 94% of total rounds in 2023 compared to Europe’s 88%. However, their prevalence is gradually diminishing, aligning more closely with the European average of 88%.

Similarly, the investment in Growth Stage rounds witnessed a 26% year-on-year decrease in 2023. Nonetheless, over the decade, approximately 2.2 billion euros were invested in Growth Stage, showcasing the highest growth rate (+720%) but remaining relatively marginal in Italy, accounting for 5.6% of total rounds in 2023 compared to 3% in 2019.

Late Stage rounds remain infrequent in Italy, with the invested amount progressing from zero in 2013 to 205 million euros in 2023. Only 12 operations were completed in this category over the decade, with a concentration in the last 5 years, where the total investment reached approximately 2 billion euros


In 2023 there was a shift in investments from sectors with explosive growth during the pandemic, such as Fintech (127,5 million euros invested in 23 vs 732,8 million euros in 22) and HealthTech (122,8 million euros invested in 23 vs 324,3 million euros in 22), towards emerging and sustainable technologies like Space and Energy (127,5 million and 147 million euros invested in 23 respectively). Enterprise Software, traditionally a focal point for investors, claimed the top spot in the Italian ranking in 2023 (217,7 million euros in 23). Investments in startups related to Sustainable Development Goals (SDGs) reached 120 million euros in 2023, growing 1.6 times compared to 2019, yet remaining below the peak of 2022.

In 2023, investments in B2B startups saw a substantial increase, constituting 82% of the total (compared to 54% in 2021). This growth aligns seamlessly with the ongoing trend of business digitalization. Investment concentration remains high, with the top 5 sectors attracting investments in Italy representing over 50% of the total funding, and the top 10 sectors accounting for more than 80%.


Exits increased significantly over the decade, particularly through M&A, with a 16-fold increase in acquisitions and a historic peak of 234 in 2023 (+47% YoY), and buyouts, increased 10 times over the same timeframe. On the other hand, Italian IPOs remained modest and fluctuating, contrasting with a more dynamic European landscape. The VC IPO market in Italy is even more static, as digital-centric VC-backed companies going public amount to a mere 3 IPOs in 2023.


Italian investors continue to dominate the domestic VC landscape (69% of total VC investors in 2023). Yet, the presence of European and North American investors has increased, accounting for 19% and 8%, respectively in 2023, compared to 10% and 5% in 2020. Asian and other global investors have had minimal and fluctuating involvement. The data confirms a positive correlation between the size of funding rounds and the involvement of foreign investors, partly attributed to the relatively modest average sizes of Italian venture capital funds and the limited number of Italian funds focused on the late-stage phase.

Ecosystem Evolution

The Italian innovation ecosystem is experiencing strong development: over the last five years, the value of Italian university spin-offs (incubators, accelerators, and venture capital networks) has quadrupled, reaching approximately 2 billion euros in 2023 with 907 registered spin-offs. European programs such as Horizon 2020 and Horizon Europe have been significant sources of subsidies for Italian universities, contributing to the growth of the ecosystem. From 2014 to 2023, around 7,500 Italian university projects have received a total of 2.83 billion euros. This trend is expected to continue, contributing significantly to the country’s economic growth and technological advancement.

State of Italian VC

Tracing Evolution and Market Opportunities