Staged Financing Beyond the Venture Record: Equity Rounds in the Accounts of Italian SMEs

Almost everything known about equity rounds in young firms comes from the records of professional investors, so the evidence is selected on the presence of an intermediary. We read rounds instead from the share-premium reserve, a compulsory, disclosed and restricted line of the Italian statutory balance sheet, for 3,225 certified innovative SMEs over 2016–2025: 2,991 priced capital increases on 1,330 firms. Firms about to raise grew twice as fast in the preceding year and held identical cash, yet six in ten closed it at a loss; profitability falls and intangible assets rise only after the round. Seven panel estimators place the association across firms and not within them; a taxonomy estimated blind to the event finds the mechanism in all five financial configurations, with incidence differing eightfold; six flexible learners fail to improve on the linear specification. Selection operates on growth, not on profitability, a distinction intermediated samples cannot see.