Alternative finance continues to represent a fundamental pillar for supporting small and medium-sized enterprises in Italy, especially in a still complex and rather uncertain economic context. In November 2024, the Politecnico di Milano published the 7th Research Notebook on Alternative Finance for SMEs, offering an in-depth analysis of the innovative instruments available to businesses and outlining the challenges and opportunities in the sector.
The alternative finance landscape in Italy
The report explores a wide range of financial instruments that are transforming the economic landscape of Italian SMEs. Among these, minibonds remain an attractive way to raise capital through bonds tailored to small businesses. In parallel, equity crowdfunding continues to gain ground, offering companies a platform to finance innovative projects by directly involving the public.
Another growing tool is invoice trading, which allows SMEs to obtain immediate liquidity through the assignment of trade invoices. On the lending front, direct lending offers a direct and fast alternative to bank lending, with institutional investors and online platforms playing an increasingly prominent role.
No less important are equity and venture capital instruments, which provide risk capital to support corporate growth, and crypto-assets, a still emerging frontier but with significant potential in the Italian context. Finally, access to the stock market through listings represents a structured opportunity for those companies ready to make the leap towards greater financial solidity.
These instruments, although different in nature, share a common objective: to offer SMEs concrete and flexible alternatives to finance their business, freeing them from traditional banking channels.
The numbers of alternative finance in Italy in 2024
After the downturn in 2023, the seven alternative finance segments confirmed a slightly negative trend also in the first half of 2024:
- minibonds raised EUR 202 million (EUR 609 million in the last twelve months), a difference of -33% compared to the same period last year;
- equity and lending crowdfunding count around 40 authorised platforms in Italy, which raised EUR 48 million (-17%) and EUR 88 million (-3%) respectively;
- private equity and venture capital raised EUR 370m in 3 deals and EUR 494m in 193 deals, respectively;
- stock market listings raised EUR 72 million, bringing the number of companies listed on the EGM (Euronext Growth Milan) to 206.
However, there are two transversal elements that lead one to be optimistic: on the one hand, the legislative and regulatory innovations that have 'raised the bar' in the segments most exposed to the risks of opportunistic behaviour, such as crowdfunding and crypto-assets; on the other hand, the simplification of more traditional segments such as listing on the stock exchange.
Future opportunities
In the context of increasing challenges, the report calls for a proactive approach to looking ahead. Among the main opportunities identified
- Digital innovation: The adoption of advanced technologies to make alternative financial instruments more accessible and transparent.
- Public-private partnerships: Synergies between financial institutions, government and alternative finance platforms to foster a resilient ecosystem.
- Financial education: Raising awareness among SMEs on the importance and potential of alternative finance instruments.
The key message of the 7th Research Notebook is clear: it is crucial that Italian SMEs actively explore the opportunities offered by alternative finance. This approach can prove decisive in ensuring business continuity and sustaining growth in a changing economic environment.
Conclusions
The 7th Research Notebook of the Politecnico di Milano is not just a report, but a strategic guide for SMEs and all players involved in the alternative finance ecosystem. In times of economic uncertainty, it is essential to adopt innovative solutions and create the basis for a more inclusive and dynamic financial system.
Italian SMEs have a unique opportunity ahead of them: to turn challenges into levers for success by fully exploiting the potential of alternative finance.
Looking ahead to 2025, there is room for optimism: the adoption of innovative strategies, accompanied by closer public-private collaboration, can lead to a revitalisation of the sector and greater resilience of SMEs. With determination and foresight, 2025 can mark a new chapter of growth and success for alternative finance in Italy.