Innovative start-ups in Italy: their special features and the effects of the 2012 law

Paolo Finaldi Russo (), Silvia Magri () and Cristiana Rampazzi ()
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Cristiana Rampazzi: Banca d'Italia

No 339, Questioni di Economia e Finanza (Occasional Papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: In 2012 the Italian Parliament introduced into Italian law a special section in the Companies Register and a large number of financial incentives to create a favorable environment for the development of �innovative start-ups� (ISUPs). In this paper we compare ISUPs with other start-ups. In accordance with the eligibility criteria established by law, ISUPs show a striking capacity for innovation apparent in a higher incidence of intangible assets and the longer time it takes to begin selling their products. ISUPs also report higher investment rates and stronger growth in sales and assets, while their financial structures are characterized by higher capitalization and greater availability of liquid assets. Based on propensity score matching, we also highlight some direct effects of the 2012 law on their financial structures, almost exclusively on ISUPs operating in the service sectors: their external funding, either debt or equity, increases more than for other similar firms; higher investment rates are specifically associated with a stronger upsurge in their capital.

Keywords: start-ups; financing innovation; equity; financial structure. Classification-JEL: G24; G32; H81; O38 (search for similar items in EconPapers)
Date: 2016-07
New Economics Papers: this item is included in nep-ent, nep-ino and nep-sbm
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Citations: View citations in EconPapers (9)

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