Public interest in cleantech is at an all-time high, and it’s recently hit the political scene with unprecedented intensity. However, the bedrock of the cleantech space is not formed by policy, but innovative cleantech start- and scale-ups, as well as the investors who support these innovators.
One such investor is Progress Tech Transfer, the VC fund sponsored and advised by MITO Technology. Progress Tech Transfer is the first Italian VC fund fully dedicated to sustainable technologies . We spoke to Francesco De Michelis, CEO of MITO Technology, to discuss his views on the Italian cleantech space, and their plans for the future.
Francesco graduated from the University of Trento Law School, and went into Intellectual Property Law in Italy. He’s co-authored a book on technology transfer agreements and is a regular speaker in workshops and conferences on intellectual property, venture capital and technology management.
Francesco laments that Italy is not among the top performing VC markets. Barriers to entry are high, considering that institutional investors are very cautious in putting money in the private market.
At the same time, Francesco recognizes that the high-quality research that comes out of Italian universities and public research organizations can lead to foreign investment in Italy. Additionally, labour costs are very competitive. Francesco highlights that he and his colleagues observe growing foreign interest in investing in the Italian market. Indeed, foreign direct investment in Italy is currently on the rise.
“We see with our own eyes, more and more foreign investors interested in Italian opportunities.”
Francesco observes a trend towards a more dynamic VC market inside Italy. For example, some pension funds – key investors in the national ecosystem – are starting to consider investing in funds smaller than 100 million Euros. This would previously have been unthinkable – an issue which has posed a significant roadblock for new players wanting to enter the investment market.
Francesco offers several ideas regarding how to strengthen the Italian investment space. For example, the government should promote the set up of new fund of funds together with institutional investors such as pension funds, banks, insurance companies and corporates with the precision mission to foster the Italian VC industry.
“Other VC ecosystems started earlier than Italy, but we are picking up speed”
Progress Tech Transfer typically invests in companies which are the product of intense R&D processes, often with at least some university involvement. Based on that experience, Francesco raised an issue connected specifically to the role of researchers and universities in the R&D process – more specifically, Italian patent law. Most often across Europe – and the world – a university is the owner of a patent that stems from research done at that given institution.
In Italy, however, it’s traditionally been the individual researcher who owns the patent. Given that individual scientists are riskier to invest in than institutional players such as universities, venture capital investors have been apprehensive to overcommit to projects in Italy, which are too dependent on individual dynamics. Now, however, the Italian regulations are set to change, allowing institutions to be the owner of the patents in question, which Francesco hopes will strengthen investors’ confidence to invest in Italy.
With Italy being the third biggest market in the EU, a strengthened cleantech presence is very welcome. We look forward to collaborating with the MITO Technology team going forward – the best is surely yet to come. Welcome to the Cleantech for Europe Investor Coalition!