Full on and full up: Digital agenda overflowing for the year ahead
Minister for Enterprise, Jobs and Innovation Richard Bruton signalled an intention to address the issue last autumn and changes seem to be on the cards for early in the new year. Ireland’s technology companies will watch this one closely.
The big question for 2013: Is there money, or isn’t there? Many companies at home and internationally say they are struggling to find venture funding. Rumours have been circulating for some time that several of Silicon Valley’s best known venture capital firms are on the rocks and it’s said that European VC firms have a hard time going up against the Valley firms.
However, VCs in Ireland, Europe and the US say they have funds looking for suitable companies to invest in. European VC say the European tech industry is reaching a maturity that makes it very attractive for investment, while Valley VCs say the Valley remains the world’s most lucrative and vibrant investment zone.
There certainly appears to be cash for the right companies in Ireland, though not always money for certain phases of development.
It used to be that there was money only for more established companies looking for major expansion. Now, there is a reasonable supply of seed funding.
Where many young companies struggle is in the bridging period, when they need expansion funding.
Enterprise Ireland offers some funding in this area for “high potential” companies, but the State gave a big boost to this space last year by offering to co-invest with established international venture firms through its €500 million Innovation Fund Ireland.
Several partnerships were announced, including deals with US venture firms Polaris Ventures and DFJ. A second call for further VC applicants, concluded last summer, should produce further announcements early this year. Some initial investments have already been made in Irish companies through these partnerships. But the State, and Irish companies looking for capital, will be hoping for further activity in 2013.
On the flip side, international VCs will be looking for Irish exits – for a sign that Ireland has an increasingly mature innovation environment, in which Irish companies grow and regularly are sold or go for initial public offerings.
Without Irish companies consistently proving their viability with valuable exits, no government scheme, regardless of how attractive, is going to lure significant, stable investment here.