Development capital gap hits firms

A shortage of development capital is hindering the formation of billion dollar indigenous Irish start-ups according to the CEO of Enterprise Ireland.

Enterprise Ireland’s CEO Julie Sinnamon said that there was a gap in the funding landscape in Ireland that meant that a lot of Irish entrepreneurs had to go abroad to get capital to further their companies.

“The area where there has been a gap is in the development capital side, so you have gotten through the seed stage and you are trying to get the next round and there hasn’t been as much money in Ireland, now in a way that has been good because they link in with smart capital in other countries and a number of those funds have not been supported to come into Ireland,” she told the audience of start-ups at the Irish Technology Leadership Group (ITLG) in the University of Limerick.

However, a panel discussing how to develop your own Google, Facebook or other billion-dollar start-up said that everything from paranoia to confidence can help.

The chairman of ITLG and former CEO of Intel, Craig Barrett, said that a healthy dose of paranoia about the competition was key to driving a billion-dollar business.

Mr Barrett referred to Andy Grove who said: “Success breeds complacency. Complacency breeds failure. Only the paranoid survive.”

While Dell’s entrepreneur in residence, Ingrid Vanderveldt, who started her first company in her 20s said that setting and surpassing goals was the key to making a billion-dollar company.

On the panel of venture capitalists was director of Intel Capital Venture Investment’s, Sean Cunningham, who revealed that he was targeting up to three Irish companies for investment this year.

The Intel venture capital fund is one of the biggest in the world and offers the development capital that Irish entrepreneurs need to become the next big thing.

“There are four or five companies I have seen here, so we will do a minimum one, if not up to three deals in Ireland this year,” Mr Cunningham said.