– IVCA survey reveals flat year overall as fourth quarter falls sharply
– Fourth quarter decline of 47% reflects “flight” by overseas investors
Dublin; Sunday, 14:00 hrs, 12th February, 2023: Venture capital investment into Irish tech firms and SMEs in 2022 totalled €1.33 billion, no change on the previous year, according to the Irish Venture Capital Association (IVCA) VenturePulse survey published today in association with William Fry. Fourth quarter funding fell sharply to €244.6m, down by 47% from €458.5m, compared to the same period 2021.
“Despite a flat year, venture capital funding in Ireland last year performed reasonably well compared to global VC trends in which funding in 2022 fell by 35% to $445 billion1,” commented Leo Hamill, chairperson, Irish Venture Capital Association. “It should also be remembered that VC funding in Ireland in 2022 was still 43% ahead of 2020, despite all the global economic challenges and uncertainties faced last year.”
He added, however, that the sharp falloff in Ireland’s fourth quarter was a cause for concern. “Global trends were reflected in the fact that overseas VC investment in Ireland fell by 73% in the fourth quarter to €58.3m, from €214m in the same period last year. The flight of international capital in the fourth quarter highlights Ireland’s exposure and the need to boost local sources of funding for scaling companies.”
Sarah-Jane Larkin, director general, IVCA said that seed or first round funding to start-ups in 2022 showed little change, up by 1% to €132.2m from €130.7m in 2021. However, seed funding fell by 18% in the fourth quarter to €40.2m, compared to €49.3m in the same period last year.
“Economic and geo political headwinds experienced last year highlight the importance of having active Irish seed funds in the local market, able to invest in a counter cyclical manner and ensure that great founding teams can build companies in Ireland even during a global downturn,” commented Ms. Larkin.
Largest deals in 2022 included: Wayflyer €134m; Flipdish €94m; TransferMate €66m; Fonoa €62m and Carrick Therapeutics – €60m.
The top sectors raising funding in 2022 were Fintech (23% of total); Lifesciences (21%); Software (19%) and Cybersecurity (8%).
Source: 1 Global Funding Slide In 2022 Sets Stage For Another Tough Year (crunchbase.com)
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Note to editors – how the VenturePulse survey is compiled
The Irish Venture Capital Association VenturePulse survey is recognised as the definitive source of fundraising activity in Ireland by the VC industry and by government and international bodies including the OECD.
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 detailed information supplied internally by members of the Irish Venture Capital Association and from published information where IVCA members were not involved.
About the Irish Venture Capital Association
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.
Ronnie Simpson BBS, FPRII; Member, National Union of Journalists
Ronnie Simpson Consulting
(Formerly of Simpson Financial & Technology PR).
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