+ 67% registrations in the Register of the Italian Ministry of Economic Development in the period 2019-2021
Slight decrease in the number of new companies registered in the Ministry Register (525 vs 567)
Average growth in turnover in 2020: +27%
Two thirds of SMEs are qualified as micro-enterprises
Newly registered SMEs are mostly operating in the services industry
Milano is the leading city in terms of newly registered innovative SMEs in the last year (112 companies), followed by Rome (82) and Turin (27)
In the last year, however, there has been a slight decline in the number of new companies registered in the Register of the Italian Ministry of Economic Development (MISE), with 525 new companies between October 2020 and September 2021, compared to 567 in the same period of the previous year. Therefore, it is clear that the number of new members of the category is limited this year, too, compared to the potential actual number and the measures of the legislator, in particular the supporting interventions introduced in the "Rilancio” Decree in response to the pandemic emergency, are still not sufficiently understood and exploited to support the growth of this sector.
This is the picture outlined in the 2021 Report of the Open Innovative PMI Observatory, realized by Grant Thornton - international audit, tax and advisory consulting network - in collaboration with the University of Pisa, which was presented today at the awarding ceremony of the “Open Innovative PMI" Award, the first national award conceived by Grant Thornton dedicated exclusively to Italian innovative SMEs.The awarding ceremony, which took place this morning in Rome at the headquarters of the National Research Council, was preceded by the conference "Outlook of the post Covid period for SMEs" where Roberto Antoniotti, Head of Digital of Grant Thornton and Valerio Valla, CEO of Studio Valla, discussed the opportunities and risks for companies in the recovery phase after the pandemic. At the end of the conference, Federica De Santis, researcher at the University of Pisa and scientific head of the project, illustrated the main results of the Open Innovative PMI Observatory, an analysis aimed at analysing the trend of companies belonging to the SME segment to highlight their demographic, economic, financial, organizational, and strategic dynamics. The conference will be moderated by Alessandro Dragonetti, Head of Tax of Grant Thornton.The winners of the fifth edition of the Award are:
The three companies stood out, respectively, for the propensity to innovation, for the strong opening to international markets, and for the particular performances achieved in the segment born before 2010, ranking first in their respective categories.
The applications were evaluated by a free and independent jury made up of experts from the Italian academic world and business community.
Alessandro Dragonetti, Head of Tax of Grant Thornton, commented: "The solid growth performance of Italian innovative SMEs highlighted in the last three years confirms the liveliness and solidity of a dynamic sector, characterized by a high resilience and adaptation capacity, which is even higher considering the pandemic emergency context. However, once again, the Observatory revealed a quite low number of newly registered innovative SMEs, compared to the potential actual number, reporting a (though slight) decrease in new registrations in the last year. The cause of this limited increase of registered companies is attributable both to the fact that the relevant legislation does not provide sufficient incentives for the sector – and it is therefore necessary to intervene with long-term measures – and to an insufficient knowledge by stakeholders and consultants of the current special regulation introduced in favor of SMEs”.
If we analyse the results recorded by the Grant Thornton Observatory and the University of Pisa more in detail, they show an increase in the average size of innovative SMEs and that about two thirds of them are qualified within the category of micro-enterprises with reference to their size, with a turnover below the two million euro threshold. About a quarter of the new innovative SMEs observed are small businesses (turnover between 2 and 10 million euros), while companies that qualify as medium enterprises remain below 10% (turnover higher than 10 million and lower than 50), but are still growing compared to the previous observation period.
The average seniority of newly registered companies is slightly lower than 9 years, showing a slight decrease compared to previous reports. This datum is fully consistent with the eligibility requirements to access tax incentives for investment in startups and innovative SMEs set up by the legislator with the Decree dated 7 May 2019. In fact, this provides that those innovative SMEs that have been operating in themarket for less than 7 years or that, if they have exceeded this time limit, demonstrate that they are still in an expansion phase or in the initial growth phases are eligible.
At a territorial level, on a regional basis, Lombardy has the largest number of newly registered companies in the last year, with 161 units (over 30% of the total number). It is followed by Lazio with 88 companies, Emilia-Romagna with 41, Veneto with 39, Tuscany with 33, Piedmont with 30 and Campania with 28, while all other regions are at much lower values.
At a provincial level, the largest number of "new Innovative SMEs" is in Milan, with 112 companies registered in the last year (-8% compared to the last datum), followed by Rome with 82 registered companies (+ 41%) and Turin with 27 (+ 59%).
With regard to the demographic characteristics of innovative SMEs, the MISE Register highlighted a low rate of female presence in the ownership structure (7.05%), showing a decrease compared to the previous observation period, as well as a low rate of youth presence (7.05%), which on the contrary shows a growth by + 0.5% compared to 2020. Foreign ownership is almost absent, with a share lower than 2%.
Particularly interesting is the growing percentage of new innovative SMEs that own patents or software in their portfolios, equal to about 65% of the companies analyzed. In contrast to this trend, there is a slowdown in the frequency with which companies invest in research and development activities.Observing the performance of the newly registered companies in the different industries, the largest groups are those operating in the services industry, which is the most represented by SMEs operating mostly in software development, IT consultancy, scientific R&D activities, consultancy, trade, electronics and manufacturing of chemical products. These segments, which represent together about 75% of innovative SMEs in 2021, are among those that had been identified as capable of responding best to the crisis triggered by the COVID-19 health emergency, also on the basis of assumptions made by the Cerved Industry Forecast in May 2020.
The second part of the Report, dedicated to the analysis of the economic and financial data of innovative SMEs, highlights a high variability in turnover levels related to the size of the companies. In fact, the analysis shows that, by comparing the data of FY 2019 and those of FY 2020, smaller companies have suffered more substantial losses in turnover than larger ones. In particular, SMEs with turnover volumes of up to one million euros recorded an average decrease by around 36%, while those with turnover volumes of higher than 5 million euros experienced an average increase equal to around 21.71%.
Referring only to innovative SMEs that registered an increase in turnover, regardless of their size, the average increase was equal to +27%.
Consistently with what has been observed in reference to turnover volumes, different trends are also observed in terms of income, depending on the size of the companies. While micro and small enterprises suffered a significant worsening of average EBIT, which registered negative values in 2020, medium enterprises confirmed the trends observed in 2019. Lastly, companies with a turnover volume higher than 50 million euros, registered an improvement in their income performance.Considering the equity profile, a growth was reported, with an average value of shareholders' equity of approximately € 2 million, in line with the legislative measures aimed at encouraging the capitalization of innovative SMEs.
The last part of the Report presents a completely innovative analysis that aims to measure the impact that the economic emergency due to the Covid-19 epidemic has caused to the SMEs registered in the Register at 30 September 2021. The methodology used is based on the calculation of four out of five warning indicators proposed in the document prepared by the CNDCEC in application of the new code of the business crisis (sustainability index of financial charges, in terms of the ratio of financial charges to turnover; capital adequacy index, meant as the ratio of shareholders' equity to total debts; cash flows to total assets ratio, i.e. the ratio of cash flow to assets; quick ratio, i.e. the ratio of short-term assets to short-term liabilities). The analysis conducted on innovative SMEs shows that an absolute majority of companies are in a good state of health: a positive sign in the post-Covid recovery phase, considering the devastating effects of the pandemic on the Italian business fabric.
The Conference, the Award and the "Open Innovative SMEs" Observatory are part of a broader project that aims to enhance Italian innovation by giving visibility to this specific type of companies, which are prevailing in the Italian entrepreneurial landscape but still not sufficiently known. In fact, the initiative has the objective of supporting the development of innovative SMEs, facilitating the knowledge of the tax, corporate and financial advantages provided for by current legislation and exclusively dedicated to innovative SMEs duly registered in the specific section of the Chamber of Commerce Companies’ Register.