News Release
Annual VC funding into Irish SMEs fell for first time since 2018
- Funding down 23% for the year and 46% in fourth quarter
- “Trump effect” leads to uncertainty in the market
- But IVCA remains positive about entrepreneurs looking to raise capital this year
Dublin, Sunday, 8th February, 2026: Annual venture capital funding into Irish tech SMEs fell for the first time last year since 2018, according to
the Irish Venture Capital Association (IVCA) VenturePulse report, published today in association with William Fry. Funding in 2025 was down by 23% to €1.1 billion. Funding in the fourth quarter fell by 46% to €291.4 million.
“It’s been a roller coaster year for Irish SMEs looking to raise capital,” commented Caroline Gaynor, chairperson, IVCA. She said that there had been an undoubted Trump effect after uncertainty caused by tariffs led to the worst second quarter for ten years.
“In addition, the fourth quarter saw a 71% retreat from the Irish market by international investors from €470m to €132.4m. This may be due to hesitation and uncertainty by US VC firms due to a number of factors including an ‘America first’ focus, negativity from across the Atlantic about Europe, and the impact of a weakening dollar.”
However, despite these headwinds the IVCA chairperson said that she remained positive about Irish entrepreneurs looking to raise capital in 2026. “The Government’s Seed and Venture Capital Scheme 2025-291 has a record allocation of €250 million and we should see the benefits kicking in shortly. In addition, progress is being made on the Government’s important enterprise scaling fund2 as well as other policy measures to mobilise capital to Irish SMEs.”
She added: “Current geopolitical events have highlighted the need for us to be more self-reliant, have more access to local capital and not be dependent on overseas investors to fund our indigenous tech sectors.”
Caption: From left: Sarah-Jane Larkin, director general, and Caroline Gaynor, chairperson, Irish Venture Capital Association. Photo: Fennell Photography.
Sarah-Jane Larkin, director general, IVCA, said that the fourth quarter highlighted the weakness of not being able to tap into local private capital. “A major reason for the 46% decline in fourth quarter funding was the 71% fall off in international investment.”
She added: “Another reason for the decrease in international funding may be that US investors may be overly focused on local AI opportunities and certainly the amount of money being invested there is sucking up a lot of venture capital. Unicorn status is being achieved by early stage start-ups in generative AI in the US much quicker than in the past.”
Ms Larkin said that the decline in overseas funding in 2025 is reflected in the 33% fall in larger deals in the €30m + category to €540.8m. In the fourth quarter this category fell by more than two thirds (69%) to €111m. Funding in the €10m–€30m range for the year overall also fell, by 14% to €269.4m.
The IVCA data suggests that transactions for smaller rounds held up reasonably well in 2025. Funding in the €3m-€5m category rose by 39% to €113.8m. There was a small decline (3%) in the €1-€3m range to €102.2m. Seed funding, or first rounds raised by SMEs, dropped by 5% to €141m.
Top five deals in quarter four were quantum computing company, Equal 1 which raised €30m; Shorla Oncology (specialty pharmaceuticals, €25m); Aerska (biotech, €17m); Fresco (smart kitchen platform, €15m) and Luminate Medical (healthcare technology, €14m).
Life science companies attracted most funding in 2025 in Ireland, raising €461m or 40% of the total. This was followed by software with €156m (14%); cybersecurity €136m (12%); AI and machine learning €104m (9%) and fintech €96m (8%).
186 deals were completed in 2025, down from 217 the previous year, a fall of 14%.
Ends
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Notes to editors:
Venture capital relates to equity investment. The IVCA VenturePulse data excludes debt, including venture debt (i.e. loans to early-stage, high-growth companies already supported by venture capital).
How the VenturePulse survey is compiled
The Irish Venture Capital Association VenturePulse survey is recognised by the VC industry and by government and international bodies, including the OECD,
as the definitive and most up to date source of fundraising activity in Ireland.
The data covers equity funds raised by Irish SMEs and other SMEs headquartered on the island of Ireland from a wide variety of investors.
This research is the result of the latest detailed information supplied internally by members of the Irish Venture Capital Association and from published information where IVCA members were not involved. A list of the funding rounds that comprise the source data for the total will be available on the IVCA website (
ivca.ie).
About the Irish Venture Capital Association (ivca.ie)
The Irish Venture Capital Association, which marks its 40th anniversary this year, is the representative organisation for venture capital and private equity firms in Ireland.
An independent DCU report found that Irish venture capital and private equity supported the state’s investment through its agencies’ Enterprise Ireland and Irish Strategic Investment Fund and geared up investment through the Seed & Venture Capital Programme by almost 16 times.
The study estimates that employment numbers in venture and private equity backed firms grow by an average of 27%, compared to an overall increase in employment in the economy of just over 3% per annum over a similar time period.
Ronnie Simpson BBS, FPRII; Member, National Union of Journalists
Ronnie Simpson Consulting
(Formerly of Simpson Financial & Technology PR).
Business Registration No: 517518
