FoolFarm launches €9 million capital increase targeting IPO and unveils new investment committee

Milan, February 23, 2024

Joining the Investment Committee are Barbara Cominelli, Riccardo Ruggiero, Dario Calogero, Amedeo Giurazza

A top team of international value will support CEO & Founder Andrea Cinelli in selecting and defining the investment strategies of Italy's largest Venture Builder, focused on Generative Artificial Intelligence and Deep-Tech, which aims from 2025 to compete with OpenAI through the launch of an innovative Made in Italy Open Source generative AI platform in Southern Italy following the example of France's Mistral AI

FoolFarm Spa, Italy's leading Venture Builder specializing in the creation of startups in the field of generative Artificial Intelligence and deep-tech technologies, based in Milan and Lecce, Italy, announces a new capital increase of €9 million to support the goals of its business plan in Italy in the 2024/2028 horizon, aiming to break even operationally by 2026 and to distribute more than €60 million in dividends to its shareholders.

This increase aims to exceed the pre-money market valuation of €50 million, projecting the company toward an IPO on the Euronext market by 2028.

The company has already raised more than €5.6 million in two rounds (Pre-Seed and Seed) since 2021 from Italian investors also institutional and international, including KPMG, CRIF, SAPA Moratti, IBL Banca, and major Family Offices such as that of the Dalla Riva family and Ottavia, which gathers important investors from the Roman industrial ecosystem, surpassing the €21.5 million valuation in just two years and aiming with this round to cross the €50 million valuation threshold, an authentic record for an Italian IT company in such a short time (founded in 2020 and operational since 2021).

Foolfarm has launched 9 startup projects, including 5 already incorporated and successful innovative startups and all based, as per Foolfarm's philosophy, on solid international patents and IP filed always in the Deep-tech sector.

Among the new companies launched by FoolFarm are:

- Voiceme(voiceme.id), a startup led by Mauro Ferri and aiming to enable payments and authentication through our voice, based on a robust European IP enabling voice payment, and which has already closed two rounds (Pre-Seed and Seed) raising over €800k, currently in Series A stage with a premoney valuation of >€10 million;

- IIO(iio.ai), Italy's "the Alexa," led by Edoardo Zorzetto is a generative AI-based conversational platform capable of recognizing human emotions and interacting in text and voice like a real human operator, has surpassed €3.5 million post-money valuation and is on track for a new round by 2024 where it aims to exceed €6 million pre-money;

- Fragmentalis(fragmentalis.com), a startup in the world of cybersecurity that launched the Stream platform, the world's most secure data exchange solution, a hyper-secure super Dropbox with a built-in secure messaging system that allows data to be transferred between companies with military-grade security and protects the most sensitive data with patented data pulverization technology, and aims to become one of the leading startups in the industry at over €15m premoney by the end of the year;

- Aidamask(aidamask.com), a generative Ai startup that enables companies to use GPT chat and generative AI without fear of data breach or data leakage from their employees through AI-masking, protecting sensitive data, and has already closed a capital raise that brings its pre-money valuation to 2.5 million. Aidamask is led by Andrea Giannuzzi;

- Snaproof (snaproof.it), a startup created by a team of ingenious students from the University of Salento through Foolers Village's FoolFarm program, built around their dissertation that aims to revolutionize the contactless experience of our cell phones with a technology called OTPr 100% made in Italy, which allows from payment to secure proof of delivery, with a simple contact between phones or objects. Snaproof is completing a capital increase round to €2.5 million and is already gathering support across Italy.

In total, FoolFarm startups have raised more than €2 million, on top of the €5.6m raised by FoolFarm, in funding from investors and are poised to scale, already representing more than €10 million in net asset value generated by FoolFarm.

FoolFarm aims with the new business plan to create 20 startups always in the target sector and create more than 100 million net asset value by 2028 aiming to break even operationally by 2026.

In fact, FoolFarm's landing on the Euronext list by 2028, aiming to capitalize over €250 million, aims to position itself among the European IT industry leaders in the Generative AI Revolution, aiming first and foremost at a competition with OpenAI to finance the launch of an international startup based on an innovative open source generative AI platform, planned by 2025, with operational base in Southern Italy around one of its University Hubs, such as Sassari and Lecce, but created by an international team following the example of France's Mistral AI.

FoolFarm thus continues in its strategy of growth in the marketplace by endowing itself with an Investment Committee (ICO) of international value composed of five independent members selected for their experience, track record and expertise in the fields of investment, entrepreneurship and technology.

The committee members are: Barbara Cominelli, CEO of JLL Italia; Dario Calogero, former CEO of Kaleyra Inc, a NYSE-listed company and author of one of the most important exits in 2023, Founder and CEO of Maya Investments; Amedeo Giurazza, Founder and CEO of the Vertis SGR fund; Riccardo Ruggiero, former CEO of Infostrada, Telecom, Tim, Aria, Tiscali and Melita.

The adoption of an investment committee of this caliber is unique in the importance and specific weight of the figures who will support CEO Andrea Cinelli in investment decisions as a guarantee to investors who will participate in the upcoming capital increase, an element of trust and assurance toward investors and in service of FoolFarm's new business plan.

"With enthusiasm and pride, I announce a significant step in FoolFarm's path of continued growth: the formation of our new Investment Committee," comments Andrea Cinelli. "We have created a team of international prestige, of true and authentic pioneers in their field, of outliers in their fields, who have deeply marked the Italian economy and its digital development. This demonstrates the value of our project and the quality of our ecosystem. The Investment Committee will be the core of our strategic decisions, with the task of evaluating and deciding on investments in startups. These leaders not only bring world-class expertise but also symbolize the innovative ecosystem we are building in Italy and soon internationally. Their commitment ensures independence, expertise, transparency and objectivity in our assessments, ensuring that every investment decision in FoolFarm reflects our ambitions and values and absolute objectivity and transparency. I thank Barbara, Riccardo, Dario and Amedeo for joining us at this crucial time. Together, we are ready to not only change the rules of the game, but to make a mark in 2024 by creating around an international team a champion in generative AI in Italy that can compete on equal terms with players like OpenAI in the world of generative AI and to enhance Italian talent, especially from Southern Italy, with our Hubs in universities. Our dream is to create in Southern Italy more than 1,000 jobs by 2028 in this revolutionary new technology around the universities where we are already present with the university Venture Building program Foolers Village."

Since its founding in 2020, FoolFarm has carved out an important role for itself in the national innovation ecosystem, making a key contribution to the Italian economy, which benefits from FoolFarm's expertise, skills and innovative solutions that facilitate technology transfer, especially in the high-brain-drain university settings in Southern Italy.

The new capital increase transaction aims to accelerate FoolFarm's growth in the territory, thanks to the strengthening of R&D areas dedicated to the development of Italian solutions and services based on generative AI and led by CTO Alessandro Redaelli, formerly of MIT, the strengthening of offerings in the field of technology transfer and enhancement of the Foolers Village project.

This initiative is inspired by the U.S. experience, which, through the inclusion of Venture Builders on university campuses, has allowed some of the world's best-known tech companies (e.g., Akamai and Dropbox) to come to life. The first of its kind in Italy, Foolers Village establishes partnerships with universities excluded from the usual circuits and focuses on the South and Islands of Italy, to contribute to the economic development of our country, providing the necessary tools for the creation of successful new businesses in Italy, starting from the genius of our undergraduate students and their theses: in addition to Lecce, Sassari, and Naples, other universities are approaching the venture-building project.

Territorial Foolers Villages enhance the genius of university students and Made in Italy technology matrix, supporting students, graduates, undergraduates and PhDs in the transition from idea to business, countering the high rate of "brain drain"-a context that allows the investment in FoolFarm to meet ESG criteria related to Social and Governance parameters.

The injection of new capital will allow the expansion of Foolers Village in 3 other universities in addition to the existing collaborations with the University of Salento and the University of Sassari; the creation of an internal reserve of about €4 million for the launch of new high-potential startups; and the strengthening of the 'Factory' through the strengthening of the team to reach 50 professionals by 2028 and of the investor community, involving angels from all over Italy. And it is precisely to further safeguard FoolFarm's investment direction that the role of the new Investment Committee will act, strengthening the protection of FoolFarm's investor community.

Finally, FoolFarm makes use of a proprietary production process called "BeFool," a sequential, industry-matrix startup creation model that, after 3 years of validation, allows multiple patentable business ideas to be developed in parallel and transformed into startups with factory processes. Startups created within VBs have outperformed startups created under more traditional models: with success rates (from Pre-seed to Series A stages) of about 60 percent compared to 24 percent for traditional ones.

"Investing in FoolFarm means investing in a new asset class that allows you to be able to invest in innovative Made-in-Italy startups in disruptive and game-changer technologies, reducing the risk by up to 10 times compared to traditional parameters thanks to FoolFarm's Venture Building methodology, guaranteeing more certain returns to our investors as well as being able to take advantage of preferential acquisition of our startups thanks to the Fast Pick program offered to investors. Not only that, the disinvestment phase is twice as fast (average 4.3 years versus 8 years for traditional ones)," concludes Andrea Cinelli. "Elements now recognized by the market as well as by our shareholders, who have believed in us from day one."



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