Ireland’s software industry needs to scale and scale fast, the chairman of the Irish Software Association Karl Flannery stressed last night, warning indigenous companies face a capital funding cliff as they seek funding to maintain their growth trajectory.
Last night the ISA Person of the Year Award went to CoderDojo co-founders Bill Liao and James Whelton. CoderDojo is in itself a case study on how to scale internationally having grown from computer classes in Cork just a year ago to a global volunteer organisation that sees more than 6,000 children on any given Saturday learn how to write software.
There are now 104 dojos happening every Saturday afternoon (41 in Ireland) in cities from Dublin to Florence, and Tokyo, Los Angeles, New York, San Francisco, London and Chicago. New ones are sprouting up in Jamaica and Africa.
At the awards last night Outstanding Company of the Year Award went to Openet.
FeedHenry were recognised with the Partnership of the Year Award and the Sales Achievement of the Year Award went to the NowFactory which also won the Technical Innovation of the Year Award.
SAP picked up the gong for Multinational Corporative Initiative of the Year Award. Big Fish was named Games Company of the Year and the Outstanding Academic Achievement of the Year Award went to Barry Smyth from UCD.
Irish tech firms warn of capital funding cliff
“Our future as an industry is all about international scaling, and it is being written in software by the companies represented by ISA,” Flannery said in his to 400 people last night.
The indigenous Irish software technology sector has over 600 companies, employing more than 10,000 people, with combined sales of €1.4 billion.
“We represent a community of category-winning scaling companies that want to transform, or even disrupt, the markets in which they operate to create the industries of the future,” he said.
According to the latest Central Bank figures, the amount of lending to Irish technology companies has dropped by 24pc in the year to June. This contrasts with data from the latest NCB Services Index showing that companies in the telecoms, media and technology sectors experienced the largest monthly increase in business activity since February 2007.
“In parallel with this, we have had a major surge in the number of start-ups in Ireland. The Irish Venture Capital Association estimates that there is a capital requirement to fund these companies of €1.5 billion or €300 million per annum over the next five years.
“Depending on your point of view, you may see this a significant investment opportunity. However, unless action is taken, we could see a capital funding cliff as these companies seek further funding in order to maintain their growth trajectory.”
Flannery said that in the next year the ISA will work with all the relevant funding stakeholders – including Enterprise Ireland and the investment and banking community – to promote the development of a coordinated menu of funding options to close that gap.
“The arrival of specialist lenders such as Silicon Valley Bank in Ireland will help to accelerate the growth of our indigenous technology sector.”
He pointed to initiatives such as Open Ireland’s Technology Visa programme, Enterprise Ireland’s IT’s Happening Here, Career Zoo and Smart Futures that are striving to avert a talent shortage in our growing technology sector.
“Developing a distinct identity and brand promise for the indigenous technology sector is critical.
“We need to see our technology professionals not just move from multinational to another or from one start-up to another but moving between companies of different scale and in different technologies and verticals,” Flannery warned.