Software and life-sciences in focus as Irish tech VC activity jumps

The amount of money raised by Irish tech firms rose by a third in the first three months of the year, but a significant chunk of the funding went to just two companies, new figures show.

The latest Irish Venture Capital Association survey (IVCA) reveals indigenous tech firms raised €322 million in the first quarter, up 34 per cent on the same period last year when €246.7 million in investment was secured.

Some €200 million of the €322 million raised went to two firms: Limerick-based waste and recycling management software firm AMCS and Dublin (and San Francisco)-based “unicorn” Intercom.

Among the other big funding rounds recorded in the first quarter were Dublin-based medtech firm Foundry Innovation & Research 1 (Fire1), which raised €40 million in funding in January to develop its remote heart monitoring product.

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Companies focused in the areas of software and life-sciences secured the most funds overall with 33 per cent and 23 per cent of all monies raised respectively.

Sarah-Jane Larkin, director general, IVCA, said that Irish technology firms continued to attract strong overseas interest especially from the US. “The Irish venture capital community continues to be the main source of funding for Irish innovative SMEs both through direct investment and as the local lead investor for international syndicate investors who invested €195 million or 58 per cent of total funds raised in the first quarter.”

Seed investment

She said a concern emerging in the first quarter is the lack of seed investments made, just 1 per cent of the total, and down 50 per cent on the same period in 2018. Additionally, there has been a decline in deals below €5 million of 16 per cent in number and 28 per cent in value.

Since the onset of the credit crunch in 2008, in excess of 1,400 Irish SMEs have raised venture capital of €4.8 billion, according to IVCA.

Separate figures from Pitchbook, a US-based platform which uses input from more than 200 search professionals with machine-learning and natural language processing technologies to gather its information on venture capital activity, shows €196.7 million in VC activity took place in Ireland in the first quarter. This compares to €172.2 million for the same period a year earlier.

Some €166.7 million in funds raised in the first three months involved US investor participation, according to Pitchbook.