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Company Formation Italy



Startup in Italy

Updated on Wednesday 05th August 2020

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Startup in Italy.jpgItaly promotes foreign investments and has a welcoming law for innovative startups. Foreign investors, especially non-EU ones, are welcomed in the country through two important programs: the Italian Start Up Visa and the Startup Hub (for non-EU investors who are already in the country).
Opening a startup in Italy has many advantages and the Startup Act is a law that sets forth favorable conditions for those who are interested in opening and developing innovative businesses. Under the conditions prescribed by Law 221/2012 these startups bring a significant contribution to the country’s economic growth and also boost employment, especially among the youth. The regulatory framework is designed to meet the needs of all of the parties involved in the startup ecosystem in the country.
Our team of agents specializing in company formation in Italy highlights some of the main principles of the Startup Law in this article. We invite investors to reach out to our agents if they have any questions on the startup in Italy schemes applicable to non-EU innovators.

An innovative startup in Italy

Investors who are interested in opening a startup need to know that the law clearly defines innovation. The rules for qualification are important for those who open a company in Italy with the desire to qualify for the program.
Below, we list the requirements that should be taken into consideration when launching a startup in Italy:
  • - Company longevity: the company needs to be a new one or it needs to have been operational for no more than 5 years; the company cannot be the result of a merger or split-up;
  • - Headquarters: these have to be located in Italy or in another EU country; it must have at least a production site branch in Italy;
  • - Turnover and profits: the company needs to have an annual turnover of no more than 5 million Euros and it cannot distribute profits;
  • - Activity: it must be involved in the production, development and commercialization of innovative goods and/or services that have important technological value.
Our team can help you register a company in Italy that complies with these requirements. 
The company’s innovative character is also assessed in order for the business to be part of the startup programme. It must comply with at least one of the following:
  1. at least 15% of the expenses incurred by the business need to be attributed to research and development activities;
  2. at least 1/3 of the company’s employees need to be PhD students or researchers; an alternative is to have at least 2/3 of the workforce with a Master’s degree;
  3. the company is a holder or licensee of a registered patent or the owner of a program for original, registered computers.
Already established companies can also take advantage of the same benefits for a startup in Italy, under certain conditions. Our agents can provide more details.

The Italian Startup Visa

Non-EU entrepreneurs can obtain a visa for a startup in Italy. This can be applied for directly or through a certified incubator in the country. The direct application can take place online or at the Embassy or Consulate in the foreign entrepreneur’s country of origin. Investors can also apply for the self-employed residence permit (valid for 1 year) no more than 8 days after their arrival in the country or apply for the two-year self-employment residence permit after the initial year (no later than 60 days before the expiry date of the current permit).
Our team can help you open a company in Italy and apply for the Italian Startup Visa accordingly. We can provide detailed information about the documents that need to be prepared and the waiting time.
According to the Ministry of Economic Development, the number of startups almost doubled in 2017 compared to 2015. The data shows the following:
  • - there were 7,398 innovative startups at the end of June 2017; this is an addition of 1,800 more companies of this type compared to the same period in 2016;
  • - 1,414 Italian municipalities had at least one innovative startup in 2017;
  • - the Milan area alone recorded an impressive number in 2017: 1,028 innovative startups;
  • - in general, a startup in Italy also has a high survival rate: only 6% of those set up in 2014 ceased their activities within the three years, until the date of the study;
  • - 21.5% of the startups in 2017 had young shareholders, below 35 years of age.
Lombardy is the region that is home to most of the innovative startups in Italy. Milan, Rome, Turin, Naples and Bologna are the provinces with the highest concentration of innovative companies.
Contact us for more information on how to commence a startup in Italy, the advantages and main issues for EU and non-EU investors.

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Call us now at +39 023 663 8610 to set up an appointment with Francesco Dagnino, one of our lawyers in Rome and Milan, Italy. Alternatively you can incorporate your company without traveling to Italy.

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