The first half of 2021 saw continued strong growth in venture capital investment across a broad spectrum of business sectors and deal sizes, according to the Irish Venture Capital Association’s latest VenturePulse survey, published in association with William Fry.
Venture capital funding to Irish technology firms increased by 7.6% on the same period in 2020 to almost €400m, a record number on previous years, as reported by Irish Venture Capital Association’s recent VenturePulse survey, published yesterday in association with William Fry. The figures show that the half year figure is up 8% year on year to €641m.
“A feature of the results is that international funding, mostly from the US, rose to 70% of the total in the first half, up 55% on the same period last year,” commented Nicola McClafferty, chairperson, Irish Venture Capital Association. “This is a strong endorsement of the high quality of Irish tech companies and reflects a global interest in them.”
Notably, although the amount raised is at a record high, there was a fall of 47% in the value of deals in the €1-€5m range, in Q2 and a 42% drop in the number of deals.
Notwithstanding global interest, McClafferty commented on the cyclical nature of international investment stating “when the tide goes out we will be unable to replicate these funds. We should be looking now to increase the supply of funding from domestic non-traditional VC investors such as pension funds, private investors and corporates as is happening across the UK and other European countries.” McClafferty has urged the Government as part of Budget 2022 to establish a working group to advise on how best to implement this.
Mark Quealy, Corporate / M&A partner at William Fry, commented: “These most recent VenturePulse figures confirm the continuing trend of strong international equity investment in Irish businesses, particularly those in export-focused sectors such as life sciences, software and fintech. However, the figures also serve as a reminder of the need to ensure that domestic institutional investment in these key areas is maintained and indeed increased, so that Irish entrepreneurs and management teams continue to be supported as they develop and scale their global business offerings.”