Irish companies raised €288m in 2009, up 18.6% on the previous year according to the Irish Venture Capital Association (IVCA) Venture Pulse survey.
“This strong performance was against a backdrop of a severe credit crunch and global banking crisis,” commented John Tracey, chairman IVCA and CEO, TVC Holdings plc. He said that the record year in Ireland compared with significant falls in activity levels of between 50-70% in US and UK markets which were back to levels experienced in the late 1990s.
The IVCA VenturePulse survey measures funding raised from domestic and international venture capital funds, from AIB and Bank of Ireland seed capital funds and Enterprise Ireland and from private investors including angels.
Funds raised in 2009 of €288m compared to €242.9m in 2008 and €225.9m in 2007. The 18.6% increase last year followed a rise of 7.5% in 2008.
Regina Breheny, director general of the IVCA, added that first round funding in Ireland represented 25% of funds raised. “In order to promote and develop the Smart Economy these high levels of first round funding for seed and start-up companies must be maintained.”
She expressed concern that Government spending cuts at agencies like Enterprise Ireland could inhibit the emergence of future innovative companies. “It would be a false economy as research shows that these companies grow faster, hire more graduates and export more than other indigenous firms.”
She added that Irish software firms will have the opportunity to network and learn how to raise funds at the IVCA/ISA Software Investment Forum on April 15th.
The number of companies that raised funds in 2009 was 139 compared to 93 in 2008 and 82 in 2007.
In the fourth quarter Irish companies raised €68.5m from investors in the three months to December 2009. This compares with funds raised of €68.6m in the same period of 2008 and €84.5m in 2007. 16 Irish based venture capital funds and private investors were involved (93 investments) and 16 international funds (16 investments).