The Italian Firms Riding the Digital Lending, PropTech Innovation Wave

With a generally healthy FinTech ecosystem, Italy is especially prominent in the areas of digital lending and PropTech. Where the two converge, a thriving community of startups has emerged in the country, developing crowdfunding platforms for real estate financing.

In this article, PYMNTS looks at two Italian innovation clusters and their shared ground.

Digital Lending and Crowdfunding

In the online lending space, Finanza.tech is noteworthy for its data-powered credit scoring and business loan solutions. As a digital-first lending platform, Finanza.tech mediates between businesses and banks, helping companies negotiate the best loan terms and access the capital they need to grow.

Another internet-native lending solution, Milan-based Credimi promises to finance companies up to the value of 2 million euros (about $2 million) without anyone ever having to step foot in a bank branch. Once a loan is secured, Credimi has an online platform that allows businesses to easily view and manage their loans and financing services from a central portal.

At the intersection of digital lending and PropTech, two other Italian companies are bringing crowdfunding to the real estate market.

Thanks to partnerships with property developers and real estate companies, Demetra and Walliance have built online financing platforms that give smaller investors access to an asset class previously reserved for investment funds and high-net-worth individuals.

Investors simply browse projects, choose one that they would like to finance, and receive their money back plus any accrued yield once the final deal is over the line.

While Demetra focuses primarily on debt lending, Walliance also has equity financing options in which investors receive shares in the real estate venture they choose to back.

Other real estate crowdfunding solutions that have emerged in Italy include Concrete Investing, Invest T and Trusters.

Italy’s PropTech Boom

Clearly, Italy is establishing itself as a hub for real estate crowdfunding firms. But one of the most well-known Italian PropTech startups, Casavo, has developed its own take on property buying, developing and selling.

The Milan-based firm has pioneered a real estate development model in which it automates and streamlines the process of selling property by using a dynamic pricing model to evaluate the financial potential of each home, calculating what the value will be post-refurbishment based on data it has about similar properties.

The Casavo business model has proven a hit in Southern Europe because there are many properties available that have massive potential but are sitting either derelict or haven’t changed hands for decades and need refurbishment.

Having started out as a pure homebuying platform, Casavo is branching out its services to become a real estate marketplace for buying and selling properties.

After successfully growing its operations, first in Italy, then in Spain and Portugal, this week the startup announced that it is launching in France, following a 400 million euro (about $408 million) Series D funding round, EU Startups reported.

The firm said it wants to continue product development so it can become an all-in-one property provider with the capability to offer additional services.

Despite Casavo’s head start in providing the PropTech that the European property buyers and sellers of tomorrow will need, the Italian startup isn’t the only player in the game.

As United Arab Emirates-based Huspy said, the European market is a big prize for PropTech companies the world over. Husky already has a presence in Spain and will use the proceeds of its latest $37 million Series A funding round to accelerate its growth across the continent.

Read more: PropTech Startup Huspy Nets $37M Series A

So, while Italy’s PropTech scene is flourishing, there’s no guarantee that Italian firms will be preferred by property buyers and sellers as Europe’s real estate market becomes increasingly digitized.

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