| Irish technology companies will continue to attract investment |
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| In spite of the much hyped downturn in the Irish technology field, Ireland's venture capitalists still view the sector as a prime arena for investment. A survey of venture capitalists conducted by Finance (see pp 6 and 7) clearly showed a strong desire to make further investments in IT and a belief in its future potential. |
The recently published Irish Venture Capital Association - IVCA - report said the amount of investments in Irish companies has increased 429 percent since 1997. Of the E208 million invested by Irish venture capitalists last year, nearly 75 percent was in technology companies. There has also been a steady rise in investment from non-Irish sources, particularly in Europe.
Niall Carroll, managing director of ACT Venture Capital, said, ‘The main source of venture capital investment is from domestic banks and pension funds, however a very encouraging trend is investment from non-Irish sources. This trend cements the fact that Ireland is still viewed as a ‘hot spot’ for investment in Europe.’
Michael Murphy, chief executive at NCB Ventures, said the supply side and infrastructural support have never been stronger for companies seeking venture capital from professionally managed funds. ‘It is likely that fewer but higher quality projects will be funded in the future and IT companies with secure intellectual property positions will continue to attract funding.’
Venture capitalists feel valuations for early stage technology companies have come back to more realistic levels and this is a good time for investing. Murphy said, ‘ Fund managers who sit on the fence too long will miss good investment opportunities in a competitive market and there is evidence that the shopping trolleys are rolling again.’
Most investors recognise the long term potential for Irish IT companies remains robust and that the sources of technological innovation within the Irish market continue to deliver. |
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| Article appeared in the November 2001 issue.
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