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Half of the top 10 funded start-ups were from outside of the capital, while women founders are experiencing a record funding year.
A total of 91 Irish tech start-ups raised €746m between them in the first half of this year, according to a report by TechIreland.
TechIreland’s H1 2022 Funding Review was published today (22 September). Overall, it contained good news for the Irish tech sector – although some details may prove concerning.
While the first-half funding compares well with other years, the €746m figure was skewed by three companies that took 40pc of the share – Wayflyer, Flipdish and TransferMate.
Irish e-commerce financing company Wayflyer became a unicorn earlier this year after raising €134m. Unicorn status also went to online ordering platform Flipdish when it raised €87.2m, and this was followed by TransferMate with its €66m raise.
As well as these three unicorns, the 10 companies to receive the most funding so far this year were ProVerum Medical (€30m), Energyx (€30m), &Open (€26m), Keelvar (€23m), Perfuze (€22.5m), Vivasure Medical (€22m) and Workvivo (€20m).
The total raised by tech start-ups so far this year is 20pc lower than the same period in 2021, however the report points out that last year was an exceptional year.
Drop in early-stage funding
A statistic that may cause some concern is that early-stage funding rounds dropped to their lowest point in five years. These were mostly seed and pre-seed rounds of €500,000 or below. This raises a concern about the pipeline of companies likely to scale in future.
Most of the capital inflow into Irish start-ups and scale-ups went to larger, more established companies. The number of investments greater than €10m increased to 18 from 16 last year.
Valuations for high-risk companies are also being reduced due to external factors, such as the war in Ukraine and inflation.
The Irish Venture Capital Association recently reported a 50pc decrease in funding from foreign investors in the second quarter, down to €152m from €303m in the first quarter. However, domestic funds were found to be sufficiently equipped to support start-ups.
“The €90m Irish Innovation Seed Fund will be a vital support for Irish start-ups at a time when early-stage funding is cooling,” said John O’Dea, CEO of TechIreland.
There was positive news for women founders and regional start-ups throughout Ireland. Half of the top 10 funded start-ups were from outside of the capital. Out of the total list of 91, 11 companies from Galway raised €98m between them, while nine Cork companies raised €68m.
Start-ups founded by women experienced a record period, with €114m in investment in the first half of the year. This was the best first-half performance on record – twice what was raised in the past two years and nearly six times as much as was raised in the first half of 2018.
Fintech, agritech and clean-tech performed the best out of the sectors overall, with health-tech and e-commerce losing out in this period.
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