Over the past four years almost 400 indigenous companies have benefited from venture capital finance which now exceeds IEP376m (E477m), according to the Irish Venture Capital Association report on investment activity. The report is produced in association with corporate law firm Matheson Ormsby Prentice.
While investment by IVCA members in year ended December 31, 2000 reached a record IEP164m (E208m), chairman of IVCA, Conor O’Connor, predicted a slowdown in investment this year.
‘Investment in technology companies accounted for some 75 per cent of investment last year. With the changed climate for technology investment we expect a reduction in overall venture capital investment in 2001.’
However, he had reassurance for the Irish high-tech sector. ‘Our members invest equity capital for the long term and I have no doubt they will continue to back good management teams with realistic proposals in this sector.’
Andrew Doyle, partner in Matheson Ormbsy Prentice which produced the report, added, ‘There has been a four fold increase in Irish venture capital investment to IEP164 million since the survey began in 1997. This augurs well for enterprises seeking funding. It suggests a level of choice and infrastructure in the Irish venture capital market which can only be good for developing an entrepreneurial culture in the economy.’
Reflecting the large number of early stage companies backed, almost three-quarters (71 per cent) of all projects in 2000 involved investments of less than IEP1 million. There were 14 transactions in the IEP2.5-5 million range compared with nine in 1999. This demonstrates the willingness of the Irish venture capital industry to fund larger transactions with five in the IEP5-10 million range, compared to no such transactions occurring in any of the previous years surveyed. |
