News Release
Venture capital funding into Irish SMEs falls by nearly half in first quarter
Dublin; Sunday 26th May (14:00 hrs), 2024: Venture capital funding into Irish SMEs fell by nearly a half (48%) to €258.5m in the first quarter of 2024, compared to €502m in the same period last year, according to the Irish Venture Capital Association VenturePulse survey published today in association with William Fry.
“Despite this fall, investment in the last three quarters has held up well against a backdrop of global uncertainty,” commented Denise Sidhu, chairperson, Irish Venture Capital Association. “This quarter and the same period last year each included one exceptional deal above €100m. If one excludes these two outliers then the decrease in Irish funding is in line with global trends which saw a 20% decline in the first quarter1.”
She said that seed funding showed resilience with very early-stage Irish companies raising €40m. Seed funding represents first rounds raised by SMEs.
While there was a downturn in funding across the majority of deal sizes, companies looking to raise €1m-€3m enjoyed a positive first quarter. Funding in this sector rose by 126% to €22.7m compared to €10m last year.
Sarah-Jane Larkin, director general, IVCA noted that international funding into Irish SMEs in the first quarter fell by 57% to €184m from €425m last year.
“The Irish ecosystem for getting companies off the ground, including Government and state bodies such as EI (Enterprise Ireland) and ISIF (Irish Strategic Investment Fund), is largely working well. The big challenge is our over dependence on unpredictable international investors in taking these start-ups to the next level of growth. In this regard, we welcome Minister Michael McGrath’s recent comments on the desirability of unlocking some of the €150 billion in domestic household deposits into more productive use for both the economy and for savers2.”
She added that the IVCA’s pre-budget submission would also make a case for allowing pension savers the opportunity to invest in Ireland’s dynamic indigenous start-up tech sector under the planned auto enrolment scheme, as happens in France.
The top five deals in the first quarter were: medical device company, Mainstay Medical (€115m); energy transition firm, GridBeyond (€42m), fintech software company, Halo Technologies (€18.4m); space tech supplier, Mybronics (€15m) and medtech company, Cumulus Neuroscience (€13m).
The life sciences sector (62%) led the way in funding this quarter followed by envirotech (17%) and software (9%).
Denise Sidhu, chairperson, Irish Venture Capital Association. Photo: Fennell Photography.
Sarah-Jane Larkin, director general, Irish Venture Capital Association. Photo: Fennell Photography.
News Release
Venture capital funding into Irish SMEs falls by nearly half in first quarter
Dublin; Sunday 26th May (14:00 hrs), 2024: Venture capital funding into Irish SMEs fell by nearly a half (48%) to €258.5m in the first quarter of 2024, compared to €502m in the same period last year, according to the Irish Venture Capital Association VenturePulse survey published today in association with William Fry.
“Despite this fall, investment in the last three quarters has held up well against a backdrop of global uncertainty,” commented Denise Sidhu, chairperson, Irish Venture Capital Association. “This quarter and the same period last year each included one exceptional deal above €100m. If one excludes these two outliers then the decrease in Irish funding is in line with global trends which saw a 20% decline in the first quarter1.”
She said that seed funding showed resilience with very early-stage Irish companies raising €40m. Seed funding represents first rounds raised by SMEs.
While there was a downturn in funding across the majority of deal sizes, companies looking to raise €1m-€3m enjoyed a positive first quarter. Funding in this sector rose by 126% to €22.7m compared to €10m last year.
Sarah-Jane Larkin, director general, IVCA noted that international funding into Irish SMEs in the first quarter fell by 57% to €184m from €425m last year.
“The Irish ecosystem for getting companies off the ground, including Government and state bodies such as EI (Enterprise Ireland) and ISIF (Irish Strategic Investment Fund), is largely working well. The big challenge is our over dependence on unpredictable international investors in taking these start-ups to the next level of growth. In this regard, we welcome Minister Michael McGrath’s recent comments on the desirability of unlocking some of the €150 billion in domestic household deposits into more productive use for both the economy and for savers2.”
She added that the IVCA’s pre-budget submission would also make a case for allowing pension savers the opportunity to invest in Ireland’s dynamic indigenous start-up tech sector under the planned auto enrolment scheme, as happens in France.
The top five deals in the first quarter were: medical device company, Mainstay Medical (€115m); energy transition firm, GridBeyond (€42m), fintech software company, Halo Technologies (€18.4m); space tech supplier, Mybronics (€15m) and medtech company, Cumulus Neuroscience (€13m).
The life sciences sector (62%) led the way in funding this quarter followed by envirotech (17%) and software (9%).
Ends
Source1: https://news.crunchbase.com/venture/global-funding-recap-q1-2024/
Source2: https://www.irishtimes.com/business/2024/05/13/budget-could-include-tax-changes-to-encourage-households-to-invest-savings/
Press queries to:
Sarah-Jane Larkin, director general, IVCA, Email: sjlarkin@ivca.ie
Mob: 087 320 9209 or
Ronnie Simpson, Simpson Consulting, Email: ronnie@simpsonconsulting.ie
Mob: 086 855 9410
Note to editors – 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.
About the Irish Venture Capital Association (www.ivca.ie)
The Irish Venture Capital Association is the representative organisation for venture capital and private equity firms in Ireland.
An independent DCU report released in January 2020 found that Irish venture capital and private equity firms have invested €5bn in Irish SMEs since 2003 and, through syndication, have attracted in a further €3bn in funding from international firms.
This supported the state’s investment through its agencies’ Enterprise Ireland and the Irish Strategic Investment Fund and geared up investment through the Seed & Venture Capital Programme by almost 16 times.
The study found that employment numbers in venture and private equity backed firms increased by an average of 27% per annum since 2016, compared to an overall increase in employment in the economy of 3.3% per annum over the same time period.