Irish tech firms seem to be attracting healthy interest from venture capitalists and investors. In the six months to June 2011 Irish technology companies raised €161.9m from investors. This is an increase of 58% on the same period last year, according to the Irish Venture Capital Association (IVCA) VenturePulse survey just published.
Maurice Roche, chairman IVCA and partner, Delta Partners says the figures “reflect a welcome increase in funds raised despite the global credit crisis,” but warned that that local venture capital companies would start to run out of funds from next year. This would have a dire effect on the future expansion of Ireland’s indigenous tech sector.
The IVCA has estimated that there could be a shortfall of €1.5 billion from 2012 over the next five years to fund follow on expansion phases.

First round still healthy
First round funding remained steady at 19% of funds raised. These funds were provided by seed funds and by private investors.
Follow-on/expansion funding represented 81% of funds raised in the first half. These funds were provided in the main by venture capital firms of which 53% were Irish and 47% provided by international VCs through syndicated deals. “The statistics show that for almost every €1 invested by Irish VCs, an additional €1 is brought in from abroad into Irish SMEs,” says Regina Breheny, director general, IVCA.
The number of companies that raised funds in the first half of 2011 was 86, compared to 82 in the same period last year and to 66 in 2009. Amounts raised ranged from €100,000 to €20m.

Sectors attracting VC cash – First half 2011
In the pharma/biotechnology sector, six companies raised €5.9m (4%).

In the drug delivery and medical device sector, 13 companies raised €25.5m (16%).

In the communications/telecomms sector, 10 companies raised € 25.3m (16%).

In the environment technology sector, eight companies raised €41.0m (25%).

Other technology (including nano technology, fibre optics, photonics and semiconductor chips) servicing a wide range of industries, two companies raised €1.9m (1%).

In the business service sector, 40 companies raised €56.8m (35%).

Other: Seven companies raised €5.5m (3%).

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