€269m raised from investors by Irish firms in 2012

Irish companies raised €269 million from investors last year, new data from the Irish Venture Capital Association has shown.

The funding, which was 2 per cent lower than the €274 million raised in the previous year, was divided between 189 technology companies, the Irish Venture Capital Association VenturePulse survey found.

That compares with 159 companies in 2011, an 18 per cent increase over the year.

“This is a very satisfactory performance especially when compared with activity in international markets which is experiencing double-digit falls as the global credit crunch continues to bite,” said IVCA chairman Dr Manus Rogan.

The survey found 20 per cent of the money raised was for first-round funding, with the balance in follow-on/expansion funding.

The report also indicated that there was a broadening of Ireland’s technology industry in the past year.

Software companies remained the biggest target for venture capital funding, taking 26 per cent of the funds raised in 2012, but there was a rise in the funding given to support medical device and drug delivery firms, which accounted for 18 per cent of funds raised.

A further 20 per cent went to technologies such as nano, fibre optics and phototonics. Ten per cent of the total funds was raised by medical software and services.

“It suggests that Ireland’s indigenous tech sector is becoming more broadly based and developing new technologies,” said Dr Rogan. “This may partly reflect funding through the Government and Science Foundation Ireland into the third-level sector.”

Important source

Irish venture capital funding remains an important source of finance for technology firms, with 735 Irish small- and medium-sized firms raising €1.45 billion in funding since the credit crunch began in 2008. Up to 20,000 jobs are credited to the support of venture capital over the period.

“The Irish venture capital community continues to be the main source of funding for Irish SMEs both through direct investment and as the local lead investor for international syndicate investors,” Regina Breheny, director general of the IVCA said.

Law firm William Fry, which provides venture capital advice in Ireland, said Irish companies are well positioned to attract further funding this year.

“Through the promotion of a wide variety of seed capital funds and a user friendly company set up environment, Ireland’s policymakers and the venture capital community have combined to make Ireland a very attractive place for entrepreneurs to start new business ventures,” corporate partner Stephen Keogh said.