ICVA: Venture capital funding into Irish SMEs reached record €502m in first quarter

Deals over €3m perform well but “choppy waters” for smaller companies

Trade

Leo Hamill, IVCA

Venture capital funding into Irish SMEs rose by almost a third (32%) to a record €502 million in the first quarter of 2023, compared to €380 million in the same period last year, according to the Irish Venture Capital Association VenturePulse survey published today in association with William Fry.

The record quarter was driven by a €300 million deal by Cork headquartered energy company Amarenco in March.

Overall, 21 indigenous companies raised between €5 million and €30 million in this quarter.

Apart from Amarenco, top deals in this period were Fire1 (€27.3 million) and Supernode (€16m). Assure Hedge, Astatine and Neuromod each raised €15 million.

The environmental industries (66%) sector led the way in funding this quarter followed by life sciences (11%).

“This was a robust quarter for Ireland when compared to global VC funding which fell by 53% in the first three months of the year,” said Leo Hamill, chairperson, Irish Venture Capital Association.

“While Amarenco boosted the figures, if you exclude deals above €30 million in first quarter 2023 and 2022, this year still saw a rise of 70% to over €200 million for the first three months, which reflects well in view of global headwinds across the sector.”

Hamill said that funding above €3 million performed well with significant increases across all deal sizes. However, he cautioned that start-ups looking for seed and early-stage funding experienced some choppy waters.

The value of deals in the €1 to €3 million range fell by two thirds to €10 million. Deals below €1 million fell by 28% to €6.5 million. Seed capital dropped 67% to €7.5 million.  

Sarah-Jane Larkin, director general, IVCA said that investment by international venture capital companies into Ireland represented 40% of the total in the first quarter. Excluding larger rounds above €30 million, international funding is up 210% on the same period last year.  

“In the context of a global slowdown in VC investment, the high level of international funding secured by Irish companies clearly demonstrates a strong appetite for innovative indigenous enterprises which reflects their high quality and realistic valuations.”

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