VCs say up to €800m could be leveraged for Irish SMEs from Govt investment

4 Jun 2013

It is expected that the venture capital industry with the support of private investors and syndicated funds from overseas should be able to leverage the Irish Government’s €175m investment in seed and venture capital to the tune of €800m for Irish SMEs, the local venture capital industry has claimed.

The Irish Venture Capital Industry Association (IVCA) said this morning that up to €800m could be leveraged from the €175m scheme announced last week by the Minister for Jobs, Enterprise and Innovation Richard Bruton TD.

The first tranche of €100m is being offered in the next few weeks.

“Based on historic evidence, it is expected that the venture capital industry, with the support of the private sector and with syndicated funds from abroad, should be able to leverage these funds up to €800m for Irish SMEs,” commented Regina Breheny, director general, IVCA.

“The announcement of this tranche by Minister Richard Bruton is timely and important in terms of job creation,” added Dr Manus Rogan, chairman IVCA.  “We expect the current availability of capital to decrease based on our knowledge of where VC Funds are within their investment cycles.”   

Under the scheme, the Department of Jobs, Enterprise and Innovation, through Enterprise Ireland, will make €175m in funding available for investment in private venture capital funds. These funds will invest in high-growth Irish companies in fast-growing sectors including ICT, life sciences, high-tech manufacturing and the green economy.

The IVCA VenturePulse survey found that Irish technology companies raised €52m in funding in the first quarter of 2013. Irish SMEs have raised approximately €250m per annum. over the last five years. The IVCA said that these new funds should maintain this investment momentum.

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