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How to finance an innovative startup with Smart & Start: successful cases

How to finance an innovative startup with Smart & Start: successful cases

7 January 2023

smart & start

Smart&Start Italia is the facilitation tool managed by Invitalia to promote new, technology-intensive entrepreneurship and leverage on the outcome of the public and private research system.

Since 2014, Smart&Start has funded over 1,400 projects throughout Italy. In 2022, 140 innovative startups were financed, with 89 million euros in investments.

Amongst the most prominent sectors, cloud computing and e-commerce stand out, each accounting for 18% of the funded projects, followed by Life Sciences (13%) and Internet of Things (9%). Innovative materials, industrial automation, agri-food, environment, and energy are also well represented.

22% of the startups funded in the past year are from Lombardy, followed by Campania and Abruzzo (11% each), and then by Puglia, Lazio, Piemonte, Sardegna, and Sicilia.

Out of 468 examined applications, 136 received a positive evaluation, with an admission rate close to 30%. Smart&Start is indeed a rather complex funding application which allows for more confidence with the assistance of professionals.

Our success stories with Smart & Start

The applications we helped submit in 2022 were related to innovative projects with a strong digital presence.

As an example a startup operating in the online tutoring sector was granted interest-free financing of almost €300,000 .

In another instance, regarding a project for the development of a specialized management platform, a facilitated interest-free financing of €380,000 was approved, in addition to €164,000 in non-repayable grants, as the innovative project is located in the Southern region.

Below, we highlight some fundamental aspects for the success of the Smart&Start application.

  • The business plan.
    The technical feasibility of the investment and the economic-financial sustainability of the project represent one of the four main evaluation areas. Drafting a business plan according to professional criteria, along with obtaining reliable sources for market segmentation and competition profiling, becomes crucial to lending credibility to the project.
  • Innovation.
    The entrepreneurial idea must have a high level of innovativeness and a strong technological component. Through partnership with a certified incubator, we can assist in identifying companies to collaborate with to enhance its level of innovativeness. It's worth noting that current regulation provides for bonus points in the D evaluation macro area "Technological and operational feasibility of the business plan" in the case of collaboration with a certified incubator.
  • Defendability
    The entrepreneurial idea must be sufficiently defendable against the possibility of replication by competitors. Thus, it becomes essential to protect intellectual property using the tools provided by the legal system and adopting confidentiality protocols with staff and major suppliers.
  • Presence of financial partners.
    The presence of professional investors who believe in the project lends reliability of the proposers and economic feasibility. Smart&Start rewards this circumstance by recognizing the maximum score in Sections A (adequacy of skills) and C in cases where a qualified investor commits to subscribing to an equity stake, even subject to the successful outcome of the Smart&Start application.

Debt Conversion

The ministerial decree of February 24, 2022 introduced the possibility for startups ,financed with Smart&Start Italia, to convert a portion of the facilitated financing into non-repayable grants.

In particular, if the company makes investments in venture capital in the form of equity investment or conversion to equity of a quasi-equity instrument by third-party investors or individual shareholders, it is possible to request the conversion of a portion of the loan into non-repayable grants.

The venture capital investment must be at least 80,000 euros, have a minimum duration of three years, and, in the case of contributions by third-party investors, must not result in a majority ownership stake. The facilitated financing is convertible up to an amount of 50% of the sums contributed by third-party investors and, in any case, not exceeding 50% of the total incentives granted to the startup.

Smart & Start: What we can do for You

Thanks to our expertise, we can identify the critical aspects of the entrepreneurial project and work together on solutions for Smart&Start.

We can assist the startup in developing the business plan and obtaining the necessary sources to validate the economic potential of the project. Through our connections in the innovation world, we can identify partners to enhance and strengthen the technological development path of the entrepreneurial concept. Additionally, we are in contact with various professional investors who might be interested in injecting the necessary capital into the startup for its development.

Contact us for a consultation

Contact us

+39 0583316636
studio@vannucci-advisors.com
Viale S.Concordio 710 - 55100 Lucca (LU) Italia
Via Fiume, 11 - 50123 Firenze (FI) Italia
C.F e P.IVA. 02623630460
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