Venture capital funding into Irish SMES falls to €221.7m in first quarter
- IVCA remains positive and says that local policy initiatives may mitigate against potential impact of Iran war
“While funding fell across most deal sizes, the outcome must be seen in the context of an exceptionally strong start to last year, when Irish firms raised more than half a billion euro, which was a record for a first quarter,” commented Caroline Gaynor, chairperson, IVCA.
Caroline Gaynor, chairperson, Irish Venture Capital Association. (Photo: Fennell Photography).
International investors accounted for 85% of the capital raised during the quarter. “This is glass half full territory,” said Ms Gaynor, “as it once again highlights our exposure to overseas investment, but also emphasises the appetite for quality Irish tech firms, despite unprecedented spending on AI in the US.”
AI accounted for about 80% of the record $300 billion invested globally in start-ups during Q1 2026, according to Crunchbase.1
In Ireland, life sciences led the way in the quarter, accounting for 54% of the total, or €119.5m, followed by fintech at 13% (€28m) and software 12% (€26.9m). While AI represented just 2% of the total on a sector basis, Sarah-Jane Larkin, director general of the IVCA, said the figure may understate AI’s real footprint because the survey classifies companies by their core industry, even where AI is now embedded in their products and services.
Ms Larkin said that it was hard to predict the impact of the Iran War on the next quarter in terms of investor confidence. “Ireland is a small market subject to global geopolitical headwinds. But local policy initiatives may mitigate against this to the benefit of early stage Irish start-ups looking to raise funding this year. For example, Enterprise Ireland has raised its direct investment limit from €250,000, and we should see the benefits of the Government’s €250m Seed and Venture Capital Scheme 2025-29 start to feed through this year.”
Funding declined across all deal-size bands except transactions of less than €1m. In the €3m to €5m range, investment fell 77% to €7.9m from €35m a year earlier. Deals worth between €5m and €10m dropped 62% to €16.5m from €43.8m over the same period.
The top five deals of the quarter were Neurent Medical (€62.5m, medtech/life sciences), Aerska (€33m, biotech/life sciences), Evervault (€21m, cybersecurity), Circit (€20m, fintech) and XFuel (€18.5m, environmental industries).
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Notes to editors:
Venture capital refers to equity investment. VenturePulse data excludes debt, including venture debt, which covers loans to early-stage, high-growth companies already backed by venture capital.
How the VenturePulse survey is compiled
The Irish Venture Capital Association VenturePulse survey is recognised by the venture capital industry, government and international organisations, including the OECD, as the definitive and most up-to-date source of fundraising activity in Ireland.
The data covers equity funding raised by Irish SMEs and other SMEs headquartered on the island of Ireland from a broad range of investors.
This research is based on the latest detailed information supplied by members of the Irish Venture Capital Association, together with published information for rounds in which IVCA members were not involved. A list of the funding rounds included in 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 marked its 40th anniversary last 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).
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