Irish VCs buck international trend as 32 firms raise €54M in first quarter

The country may be experiencing the deepest recession in the Eurozone, but 32 technology companies in Ireland raised €54 million in the first quarter of 2009, up by 24 per cent over the same period last year, according to the Irish Venture Capital Association (IVCA) VenturePulse survey.

“This compares very favourably to fund raising in the US and UK, which is down in the first quarter,” said Regina Breheny, director general of the IVCA. First quarter figures for the US announced recently show activity down 61 per cent in dollar terms and down 44 per cent in terms of the number of companies raising funds.

In the UK data sources are reporting similar declines of up to 70 per cent. “So not all the financial news coming out of Ireland is bad,” said Breheny. Money is available for start ups, with the figures showing that first round funding in Ireland accounted for 30 per cent of funds raised, compared to 20 per cent in the US.

In 2008 as a whole, 93 technology firms raised €243 million. “This is 7 per cent up on 2007, and in the teeth of the global credit crunch,” said Joe Concannon, chairman, IVCA.

He added UK figures suggest that total funds raised there in 2008 came to €885 million, excluding pharma/bio. “When you consider the respective sizes of the economies this suggests that Ireland is punching much bigger than its weight internationally and nurtures some hope in striving towards the goal of creating a smart economy. The government’s move to invest in university R&D may be starting to see benefits.”

The number of companies that raised funds in the first quarter of 2009 was 32, compared to 24 in the same period in 2008 and to 14 in 2007. Amounts raised ranged from €50,000 to €18 million. In all, 15 Irish-based venture capital funds and private investors were involved, with ten international funds and private investors.

In the pharma/biotechnology sector, four companies raised €23.5 million. In the drug delivery and medical devices sector, four companies raised €2.3 million, while in the telecoms sector, four companies raised €5 million.

In the environment and technology sector, three companies raised €9.6million, while in other technology, which includes nanotechnology, fibre optics, photonics and semiconductor chips, five companies raised €3.3 million. In business services four companies raised €2.2 million; eight other companies raised €7.6 million.