Failure Factors for Startups in Italy

Abstract

It has been over a decade since the Startup Act in Italy was approved in 2012 when the Startup Act decree legally gave birth to the Italian startup ecosystem. 2022 closes with 14,708 Startups in Italy, ensuring a steady positive contribution to the employment structure. However, many entrepreneurial initiatives in Italy fail within their first years of life. This research paper is set in this context with the aim of analyzing, in acknowledgment of the contribution made by Startups, what are the main drivers of Startup failure in Italy. The size of the phenomenon is analyzed, with the geographical distribution of start-ups in Italy and comparing them with the rest of the world, and the stages of setting up a start-up, understanding its life cycle, which is essential to follow properly to ensure success. Qualitative data is then analyzed with the aim of providing some insights into the quantitative relevance of the Italian entrepreneurial phenomenon. Furthermore, there is a section in which the method used consists of conducting semi-structured interviews with twenty-two selected interviewees, mainly investors and failed Italian start-ups. Once these factors have been identified, it will be possible to elaborate targeted strategic recommendations addressed to entrepreneurs in order to increase their chances of success.