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2025 is proving to be a positive year for the Italian mergers and acquisitions (M&A) market: 1,369 deals were concluded (+8% compared to 2023) for a total value of approximately €73 billion (+91% compared to last year). The leading sectors are technology, media & telecoms (TMT), energy & utilities and financial services, which account for 65% of the value of the Italian M&A market. In particular, the TMT sector saw strong momentum in IT and software transactions, with numerous strategic acquisitions that strengthened the competitiveness of Italian companies.
The Italian Software as a Service (SaaS) market continues to show signs of growth and consolidation. According to the Cloud Transformation Observatory of the Politecnico di Milano, in 2025 the SaaS sector reached a value of €1.532 billion, with growth of +19% compared to the previous year. This figure confirms the dynamism of the sector and its central role in the digital transformation of Italian companies.
The presence of over 26,000 software companies, more than 83% of which have fewer than 10 employees, represents widespread entrepreneurial wealth. This structure can become fertile ground for new forms of collaboration and aggregation, capable of generating shared value.
Mergers between start-ups and innovative SMEs, through M&A transactions, are the key to:
- strengthen the competitiveness of the sector, creating more robust and attractive players;
- generate operational synergies and increase productivity;
- increase appeal to investors and large companies interested in solid, productive businesses;
- promoting sustainable exits that reward the work of founders and investors;
- stimulating the real economy through reinvestment and new initiatives.
The strategic role of venture capital
In the first half of 2025, Italian venture capital recorded 153 transactions (+18.9% compared to 2024) for a total of €443 million invested. Despite a slight decline in amounts compared to the previous year, the number of rounds is growing, a sign of a dynamic and evolving ecosystem. The ICT sector, together with the green economy, healthtech and fintech, is among the most active, accounting for 20% of registered innovative start-ups.
In this context, venture capital can play an even more decisive role, not only as a driver of organic growth, but also as a facilitator of strategic M&A transactions that consolidate the market and create value in the medium to long term. Mergers between start-ups and innovative SMEs offer multiple advantages:
- greater competitiveness thanks to reduced fragmentation;
- operational synergies that improve efficiency and profitability;
- attractiveness for large companies interested in solid and productive businesses;
- sustainable exits
Venture capital, therefore, is not only a driver of organic growth, but can also become a true enabler of mergers and acquisitions by actively promoting M&A transactions.
Towards an integrated and competitive ecosystem
In order to build an Italian VC and M&A ecosystem that is competitive at an international level, it is essential to:
- promote public policies that encourage partnerships between start-ups and SMEs;
- promote innovative financial instruments that facilitate consolidation operations;
- actively involve institutional investors and pension funds;
- promote successful exits as virtuous examples to be replicated.
Conclusion
Mergers and acquisitions are key to the growth of Italian start-ups and the development of a solid and competitive venture capital market. Through a structured and shared growth strategy, it will be possible to transform fragmentation into strength, generating innovation, employment and value on a global scale.
Lucia Occhiuto is a solicitor, founder of Occhiuto Legal and head of legal & policy at Italian Tech Alliance – (photo by Edge2Edge Media on Unsplash)
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