Emerging Irish tech firms drawing venture capitalists in swarms

25 Nov 2011

Dublin City vista along the River Liffey, with a view of the Four Courts building

Ireland’s tech sector is putting the country on the global map for venture capitalists, eager to tap into the best technologies being pioneered on the planet right now. Already Ireland’s tech sector gleaned €161.9m in investment in the first half of the year.

This is a jump of 58pc for the same period in 2010.

More than 100 guests converged in Dublin for a William Fry breakfast briefing, ‘Raising Venture Capital’.

Shay Garvey of Delta Partners said the reason why Ireland’s technology sector is garnering the most VC investment is because businesses in this sector are demonstrating the greatest potential at the minute.

He said that in the current economy they have the ability to start up at a relatively low cost, to quickly get their products to customers and make an early impact on the market.  

“These are all factors that are attracting seed funding at an earlier stage than would previously have been seen, often higher volume but for smaller amounts when investors are prepared to take much more of a ‘try-it-and-see’ approach,” said Garvey.

Two experts in funding high-potential businesses, Andrew Hunter, relationship director, Silicon Valley Bank, and Leo McAdams, Equity & Legal Department manager, Enterprise Ireland, spoke at the event.

According to the speakers, there’s never been a better time to raise capital in Ireland for companies who have a solid business plan with strong potential for export growth.

One of the most significant sources for Irish companies for funding is Enterprise Ireland which, over the last 36 years, has provided €0.5bn to businesses who can demonstrate that the support will contribute to employment and economic growth in Ireland and that they need the funding.

Seed funds

McAdam said today that the volume of deals being done by Enterprise Ireland had doubled over the last two years and would reach 220 in 2011.

“Enterprise Ireland is actively involved in supporting high-potential start-up projects and companies that have the capacity to break into export markets and grow quickly. Access to funding is a critical ingredient in the success of these companies. The seed funding environment has been transformed over the past two years. From a base of one fund with €30m under management in 2009, we now have four seed funds with €124m for seed capital investment. This represents an unprecedented level of funding for the key start-up/early stage segment of Irish business,” said McAdam. 

Through its network of 31 international offices, Enterprise Ireland actively supports Irish companies to grow their export markets and create jobs in Ireland.

Stephen Keogh partner at William Fry

Stephen Keogh, partner, William Fry
Stephen Keogh, partner at William Fry, told the audience that despite the global recession and Ireland’s challenging economic environment, funding options and support have been made available through various initiatives. “There are a number of sources of funding for early-stage companies – the most notable trend this year has been the emergence of the seed funds.”

Silicon Valley Bank

Hunter, a specialist in technology companies, outlined how the next step for a company after raising venture capital investment is often to engage with an organisation like Silicon Valley Bank.  

His message for the audience was that success often came down to having the right relationships in place, as well as a solid business proposition.  

Hunter said Ireland is very much viewed as a growing opportunity by Silicon Valley Bank, which has offices across the world, including London, and that a lot of great technology companies are emerging in Ireland.

Carmel Doyle was a long-time reporter with Silicon Republic