Northern Ireland tech investment crossed a record £100m in 2021

8 Mar 2022

Kieran Dalton, head of scaling at Catalyst. Image: Catalyst

New data from Catalyst suggests that tech firms saw unprecedented levels of funding in 2021, a meteoric rise from only £5m investment in 2014.

Tech investment in Northern Ireland has broken records, crossing the £100m mark for the first time in 2021 and marking a strong recovery from the pandemic.

New data published by Catalyst in its Deal Tracker today (8 March) shows that investment in tech firms based in Northern Ireland last year shot up 127pc over 2020 levels. The region made records in terms of the number of deals and average deal value.

Future Human

Average deal value in 2021 was more than £1.5m, an increase of £387,000 on the previous year. The total number of companies that received funding stood at 66, with 24 of them receiving funding for the first time.

The report also estimates that tech deals in Northern Ireland represent 9pc of all venture capital activity on the island of Ireland, which reached a record high of €1.3bn in 2021. More than three-quarters of this investment in NI came from outside the region.

Kieran Dalton, head of scaling at Catalyst, said that 2020 was “a year of consolidation for investment” in Northern Ireland as the impact of Covid “forced investors to back their existing portfolio at the expense of doing new deals”.

“As we all became more resilient to this new way of working, investment very quickly recovered and surpassed what we in NI have ever seen,” he said.

Investment in tech companies in Northern Ireland has come a long way. In 2014, only £5m of venture capital investment took place in Northern Ireland, which makes the new £100m mark in seven years all the more remarkable.

Dalton said the rise in investment “is testament to the quality of founders, start-ups, scale-ups, the strong local ecosystem and heightened interest from investors outside NI”.

Cloudsmith, a software start-up based in Belfast, was one of the many companies highlighted in the report for securing significant investment. Last September, Cloudsmith raised $15m in Series A funding to hire 60 new employees and expand its presence in the US.

The investment was led by US venture capital firm Tiger Global, which invested in Northern Ireland for the first time – along with other big firms such as Angular Ventures and Ada Vetures. Others such as Frontline, MMC and Par Equity continued to support investments.

But there may be issues ahead for funding in Northern Ireland. Invest NI, the economic development agency for Northern Ireland, has been facing budget uncertainty and recently said it is unable to support Ignite NI’s accelerators.

Interim Invest NI chief executive Mel Chittock told a Northern Ireland Assembly committee last week that “there is no crisis” and the agency has now received an indicative budget allocation to plan for the year ahead.

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Vish Gain is a journalist with Silicon Republic