Angel investors say they will invest €85m in 264 Irish start-ups by 2022

3 Apr 2017

Image: r.classen/Shutterstock

Irish angel investment could be leveraged up to €230m by 2022.

Business angels are expected to invest €85m in 264 high-potential start-ups over the next five years.

This will mark a 79pc increase in investment over the previous five years, which saw €47.4m benefit 244 companies.

‘We expect the €85m to leverage an additional €145m in matching funds from public, private and international funders’

Last year was a record-breaking year for business angel funds in Ireland, with €13.6m invested in 50 early-phase companies.

This leveraged a further €20.5m from other public and private funds, bringing the total invested to €34.1m.

Angel investment community needs more women investors

Angel investors expect to invest €85m in 264 Irish start-ups by 2022

John Phelan, national director, HBAN. Image: John Ohle

Halo Business Angel Network (HBAN), a joint initiative of InterTradeIreland and Enterprise Ireland, expects that businesses operating in a number of key industries stand to gain from the predicted cash injection.

These industries include ICT, enterprise software, medtech, and food and beverages.

“These forecasts are based on the growth we have seen in angel investment over the past five years,” said John Phelan, national director of HBAN.

“They clearly demonstrate a very strong and growing appetite for investing in start-up companies. In an international environment where low-risk investment receives minuscule or even negative returns, there is an increasing interest in balancing investment portfolios with higher-risk seed investments.”

HBAN revealed that serial business angels account for 10pc of all Irish angels and more than a quarter of investments. They also account for more than two-thirds of the value of investment.

Around 80pc of angel investors have started their own companies.

One problem facing the sector, however, is that business angels are predominantly male (90pc) and generally middle-aged.

“What we have seen recently is that the number of businesses receiving investment isn’t changing dramatically, but the amount of capital that angels are injecting into those businesses is increasing considerably,” said Phelan.

“This reflects the quality of company that angels are presented with through HBAN. We only introduce angels to companies that we are confident are investor-ready and have the potential to scale.

“We expect the €85m to leverage an additional €145m in matching funds from public, private and international funders – such as Enterprise Ireland, venture capital firms, founders and European investment funds – so this is very exciting for the future of angel investing in Ireland.”

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years