The year 2021 confirmed that the Fintech sector is experiencing a real moment of ferment and growth: banks and other players in the financial system have developed new channels and digital services, and at the same time, every year Italian consumers show a greater propensity towards digital and more innovative financial services. The interest in this area is highlighted by the IAG Index, a thermometer of the startup ecosystem calculated on the database of startups analyzed in the selection of investment opportunities of Italian Angels for Growth: in 2021 the startups in this sector that were analyzed accounted for 13.6%, increasing by 49% compared to the previous year.
The result obtained fits in a coherent way with the European panorama, in which the fintech sector has cemented its position as the dominant category of unicorns: in total, there are about 70 European unicorns in different sectors, and almost half of these are in finance.
This means that Europe currently accounts for around 25% of all 120 fintech unicorns globally (source: CB Insights). The contribution of Europe is not to be underestimated given the relatively small size of its capital markets compared to those of the United States and Asia.
The IAG Index confirms once and for all the importance and growth of collaborations and relationships within the varied Fintech ecosystem, also thanks to successful Italian initiatives such as Scalapay, which officially became the first Italian unicorn, significantly expanding its own range of action within the boundaries of the Buy Now Pay Later.
The digitalization of financial processes and the online platform management of operations, both front-end and back-end, are just some of the key factors that have catalyzed the acceleration of Fintech. The Italian market started late but is catching up as demonstrated by some success stories in the IAG portfolio such as Fido and Sonect, but also the commercial partnership launched by Banca Generali with the startup "wallet provider" Conio which offers custody, trading and reporting with a particular focus on Bitcoin.
In 2021, the Business Angels investing through club deals reaffirmed their preference to invest in the Seed phase, which corresponds to 66.4% of the startups analyzed, an increase compared to the previous year precisely to confirm this strategic positioning.
The IAG Index underlines the interest in the Seed stage of development also thanks to the maturity of the Italian venture capital ecosystem which has witnessed the birth of numerous new players with the role of incubators and accelerators in the pre-seed stage and institutional funds of VC and Corporate VCs that instead support early-stage projects.
This allows angel groups to give their full support to startups in the phase in which they can contribute more for the amounts invested and strategic support to entrepreneurs: investing through a group in fact allows you to increase the amount of capital raised in favor of the startup without exposing yourself individually in an excessive manner (thus maintaining good portfolio diversification) and leveraging multidisciplinary skills within the investor group.
During 2021, there was a generalized increase in valuations, both in the pre-money and post-money phases. The greater presence of players and the evaluation of policies in favor of the ecosystem have allowed an "inflationary effect" on the entire fabric of the innovative startups. In addition, the massive intervention by Cassa Depositi e Prestiti made it possible to exceed 1 billion euros in investments for the first time in Italy in 2021.
Furthermore, the Diversity & Inclusion theme is assuming an increasingly important role. For the most virtuous organizations in this area, these practices are a driver of innovation and differentiation, they increase revenues and improve customer satisfaction. Gender diversity represents a fundamental ingredient for the development of a startup, to be able to seize the opportunities and needs of the market at 360 °.
In this regard, the IAG Index highlighted how the percentage of startups analyzed with at least one woman among the founders turns out to be above international standards, reaching 41.3%, with an important increase of 58% compared to 2020, which was distributed evenly in all the industry areas analyzed.
IAG has undertaken various initiatives to enhance these two values that have always been central to the association, inclusion and diversity. A diversity campaign was carried out in 2021 with the aim of offering equal opportunities for birth and enhancement of talents, partnerships were created with local and sectoral organizations to develop a more innovative, fairer, and more sustainable society, and a rich calendar of editorial content and interviews conducted with the partners and actors of the ecosystem, who underlined the importance of the topic and how much more can be done to bring about real change.
Carlo Tassi, President of Italian Angels for Growth: "IAG aims to be a fertile ground where business angels and startuppers can meet and undertake this journey together, also offering the possibility to potential investors to approach this world with education and coaching by senior investors. In this context, the IAG Index proves to be a useful tool for measuring the startup ecosystem and intercepting what is happening in the world of innovative companies".