The Italian Private Equity and Venture Capital market has been strongly impacted by the effects of the financial crisis.
In the first six months of 2009, the figures from the Italian Private Equity and Venture Capital Association (AIFI) show a severe decrease in the investment activity, with €1.069m (61% drop in comparison with the same period of 2008) going into 155 new deals (a drop by 9%).
As usual, the main part of the investments were related to buyouts (74% of the total), with €785m (-36%) invested into 43 deals (-12%).
The main number of investments remains related to the expansion financing. Between January and June, €132m funded 58 deals (+2%).
In the same period, the early stage and start-up investment activity grew, with €56m (+7%) coming into 46 rounds of financing (+15%). Nevertheless, the low level of deals in this segment, both in terms of amount and number, continue to represent the main weakness of the Italian venture capital industry and reveals, except for some good practices, the incapacity of the country to innovate its economic system, connecting research and business.
Turnaround investments, aimed at supporting companies in difficult situations, strongly increased with total amount passing from €22m in the first semester of 2008 to €78m in the first 6 months of 2009.
Difficult times also impacted the fundraising activity. In Italy, institutional investors raised €290m, representing a 68% decrease in comparison with the same period of 2008.