H - FARM
Topic of the practice
Support to start-ups
Good Practice Information
H-FARM is a Venture Incubator operating internationally on the Web, Digital and New Media, promoting the development of startups based on innovative business models. It offers itself to the market as both incubator and investor: it provides startups with the capital required to commence operations (seed capital),and it supports the team with an entrepreneurial approach, by supplying a range of administrative, financial and commercial services. H-FARM model combines the traditional Venture Capital approach, aimed at maximising the portfolio value, with that of the incubator, remunerated by the monthly fees received for the business development services provided to the startups. It has access to an ongoing high-quality deal flow: over 400 investment proposals are evaluated and selected. The initiatives identified undergo an incubation period ranging between 36 and 48 months: once an idea is chosen, business model is defined, the business plan drawn up, the investments in R&D allocated.
It is an approach that aims at speed and a fast go-to-market, its objective being that of exposing the business undertaking to its reference market as soon as possible and, lastly, an approach that concentrates on income generation so as to eventually enable the undertaking to reach full financial self-sufficiency. The incubation process culminates with the sale of the company to third parties, agreeing with the company, where possible, to remain with H-FARM for at least 5 more years during which the startup will continue to pay the incubation fees. The key elements of H-FARM’s success: - An innovative approach that is unique in Europe and capable of combining an acceleration programme focused on the Web and Digital area, with Venture Capital investments, shaping up the concept of “smart money”; - An international presence: Italy, US, UK and India; - Vertical competences: the founding shareholders have been successfully operating in the reference market for more than 15 years;
Evidence of success
So far, H-FARM, founded in 2005, has invested more than € 9 million of private capitals in developing new entrepreneurial activities and is going to invest € 10 million more in the next 5 years. To date the portfolio comprises 30 startups, of four have already been sold with successful track record: 3 deals were closed profitably (the IRR was generally above 100%) with important international counterparties. H-art, web agency established with a seed investment of € 100,000, was sold for € 5 million to the WPP group, world leader in advertising and marketing services. In 2011, having become a reference point for Internet in Italy, H-art reached a turnover of approximately € 10 million.
Contact details to obtain further information on the practice
Ms. Giulia Franchin (Press Office)
Annex completed on: 07-16-2012