Venture Capital to Raise €750 Million in Ireland
According to a recent article in the Independent, venture capitalists in Ireland are looking to accumulate €750 million for the next round of Ireland’s technology investments. The chairman of the IVCA (Irish Venture Capital Association), John Flynn, states that venture capitalist are seeking €750 million to finance a new tech investment wave that is suppose to reach €1.6 billion.
Venture capital cycles tend to come every five to six years, and Ireland’s venture capital industry is towards the end of their last cycle. If they are not able to accumulate the desired capital for their booming startup tech industry, this can lead to a large impact in the startup industry. The desired money needs to come in by next year, according to Flynn.
Flynn also states that Ireland needs to dip into their National Pension Reserve Fund of €6.8 billion to help fun the new wave of technology companies arising. Flynn talks about the different tax structures that need to be put in place to increase Ireland’s venture capital fund. He states, for example, that the UK has seen a higher growth rate in angel investors because their tax relief structure is much more beneficial towards entrepreneurs.
Five years ago, Ireland was seen as a hotspot for call centers and localization. Today, there is much higher growth in finance, engineering, and logistics. Flynn also points out that the startup environment is changing in Ireland. Before, startup companies would sell to venture capital firms as soon as they hit €20 million. Now, companies are looking more at the bigger picture and trying to create a company for the betterment of society. There is less of a “get rich quick” attitude, and more of a collaborative attitude.
Analysts predict that the venture capitalists will be able to fund 40 startup companies along with 110 growth companies per year as posted by the Irish Independent.