Irish VC investment fell 38pc in 2022, report claims

24 Jan 2023

Anna Scally, partner and head of technology and media at KPMG in Ireland. Image: KPMG

The latest Venture Pulse report shows a significant decline in VC investment worldwide, reaching its lowest levels since 2019.

Venture capital (VC) investment saw a significant drop in Ireland last year despite a stronger-than-expected end to the year, according to KPMG’s latest quarterly Venture Pulse report.

The report shows that Ireland’s total VC investment reached $1.16bn across 122 deals last year, which marks an investment decline of roughly 38pc from 2021. That year, VC investment was $1.87bn across 287 deals.

The fourth quarter of the year saw 25 VC deals close in Ireland, worth a total of $191.8m. One of the investments in Q4 was the $55m raised by automation start-up Tines, bringing its total Series B funding to $81m.

Other large investments include Carrick Therapeutics, the Dublin biopharma which raised $25m in a Series C round and secured $35m from Pfizer. Cork cybersecurity start-up Vaultree closed a $12.8m Series A funding round during this quarter.

VC investment faced similar trends worldwide last year, according to the report. The end of 2022 was the fourth consecutive quarter where VC investment dropped, falling from $102.2bn on 9,767 deals in Q3 to $75.6bn on 7,641 deals in Q4.

In Europe, VC investment fell to $12.9bn across 1,936 deals in the last quarter of 2022, compared to $21.2bn across 2,476 deals in Q3. The report claims global investment has fallen to its lowest levels since the second quarter of 2019.

Anna Scally, head of technology and media at KPMG Ireland, said VC investment has returned to levels seen “prior to 2021” but the market itself has still faced some changes.

“Our geopolitical and economic circumstances have changed fundamentally and in an incredibly short period of time,” Scally said. “Both companies and VC investors are working to understand what those shifts mean and how best to respond.

“Ireland’s tech ecosystem remains strong despite some setbacks and industry cost-cutting.”

Tom Henriksson, general partner at early-stage VC company OpenOcean, said it is not all “doom and gloom” as there are hopeful trends in the VC market, such as continued investment in renewable energy companies.

“Although investors are cautious, they have had lots of success in fundraising,” Henriksson said. “Dry powder is at an all-time high, which means that it is still possible for companies to attract investment as long as they display sound business fundamentals and are focused on solving real-world issues.”

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Leigh Mc Gowran is a journalist with Silicon Republic