The Italian alternative finance industry is worth €3 billion, the latest findings from a research by Politecnico of Milan, an Italian university, reveal.
Generally speaking, all the market segments confirm upward trends, with the only exception of ICOs (i.e. Initial Coin Offerings) which almost collapsed passing from €80 million to €5 million. The other way around, crowdfunding and invoice trading signed the biggest growths over the past year.
A further point of attention is given by the progressive integration of segments like in the case of equity crowdfunding platforms offering mini-bonds.
EQUITY CROWDFUNDING
With a specific focus on the equity side, equity crowdfunding more than doubled its dimensions in the period between June 2018 and June 2019 passing from €33 million to €82 million (October 2019 estimates up to €100 million). Mamacrowd (€22 million), Crowdfundme (€ 15 million) and Walliance (€ 11 million) are the market leaders.
Looking at the rationales behind this success, the new regulatory framework has played a pivotal role by allowing a bigger number of startups to take part in the digital fundraising process.
Moreover, new tax rates for investors, the development of specific subsegments like the real estate crowdfunding and the presence of very successful campaigns all contributed to the equity crowdfunding growth.
WHAT’S NEXT: INVESTOR PROTECTION
In commenting the data, Ms Tiziana Togna, Deputy General Manager of Consob, the Italian financial markets regulator, pointed out that whilst the whole European market has established itself as a reliable alternative source of traditional finance, from now on the main challenge is on the investor protection side as retail
“Investors must be aware of the risks involved in investing in illiquid instruments” since “by their very nature, these instruments have a long-term investment perspective.”
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Oliver* 