Innovative startups, conventionally defined as rapid-growth firms with outside investors and an IPO or trade sale as exit event, have been a major force in commercializing innovative science and revolutionizing the world we live in. In order to create a more favorable legal environment for innovative startups, some legislators have adopted targeted policy interventions. In this regulatory competition, broadly speaking, Italy stands out, being the first European country to have introduced tailor-made rules for innovative startups. This result was achieved not by introducing a new corporate form, but by turning the traditional limited liability company, called società a responsabilità limitata (SRL), on its head. With a special regulation implemented during the years from 2012 to 2017 and placed outside the Civil Code, the Italian lawmaker introduced disruptive innovations in the field of company law, allowed digital incorporation and envisaged a series of tax and labor law benefits, as well as a privileged treatment in the case of insolvency. The end result is what important scholars call a phenomenon of hybridization of company types.
European Business Law Review