Artificial Intelligence and Venture Capital: the new investment frontier

Investing in innovation technology today means Artificial Intelligence (AI): it is estimated that the expected savings over the next two years resulting from the new technology are between 10-15% such as to unleash an increase in competitiveness across all business functions, according to data from Bain & Company. From transport and mobility, to aerospace, pharma and healthcare, agriculture and food: all sectors are involved because a company's ability to remain competitive depends on its ability to innovate, not only in the products and services it offers, but also in its internal processes.

According to the Italian Cfo's, gathered in Verona at the 46th congress of the Andaf (association of administrative and financial directors), one of the obstacles to the realisation of investments is access to adequate financial resources. As Alessandro Profumo, a former banker, recalled, the stock exchange may not be sufficient as a fund-raising tool today: in recent years, 20% of companies on Wall Street have abandoned the list. This is why private assets such as venture capital can be a decisive resource. CDP Venture Capital Sgr, for example, has earmarked a billion euro through an AI investment vehicle. 'Venture capital is fundamental for the future of the country,' explained Andaf chairman Agostino Scornajenchi and managing director of CDP Venture Capital, 'Italy is lagging behind other economies similar to ours and we have the task of catching up with this delay.

The limited access to capital from large institutional investors such as insurance companies, pension funds, and pension funds constrains the development of the Italian ecosystem when compared to other European countries: in Italy, for example, 0.07% is invested in venture capital, compared to 0.3% in Europe and 3-4% in the United States. 'Unlocking just 1% of capital from Italian pension funds and pension funds would mean injecting EUR 3 billion into the country's real economy, giving a great boost to investment,' added Andaf's president.

The recent Draghi report on European competitiveness has highlighted how innovation and digitisation are key elements for Europe to maintain and accelerate its productivity, which is essential to counterbalance demographic declines and loss of competitive power related to an increasingly globalised market, stressed Andrea Montanino Chief economist and Director of Sector and Impact Strategies at Cassa Depositi e Prestiti (CDP) : "One of the main problems for innovation in Europe is the competitiveness of our research system at the global level, the transfer from research to business and insufficient investment in R&R. Greater use of public and private funds to stimulate innovation, especially through Venture Capital, improving the regulatory environment to facilitate capital inflows and developing an advanced technological and digital infrastructure to keep Europe competitive in the global market, are some of the report's proposals.

The fields of application are numerous: from financial analysis to market research, asset management and fraud prevention, the applications are endless. CDP Venture Capital, for example, has invested in innovative start-ups such as Axelera, which deals with artificial intelligence on edge devices, Sibyllia for the development of innovative drugs, and Argo for railway traffic management.