Value of Enterprise Ireland partnership funds to rise after €34m investment

THIS year should see the combined value of investment from the various Enterprise Ireland partnership funds rise by about 30%, with the number of actual investment projects doubling at least.

Yesterday, Enterprise Ireland issued its Seed and Venture Capital Report for 2008. This detailed how €34 million was invested last year by Enterprise Ireland Partnership Funds – the various seed capital and venture capital funds in which the state development agency contributes half the investment with partners putting up the rest – into 104 different start-up and SME projects.

The timing of funds being allocated and the extra funds being made available from the main two banks – AIB and Bank of Ireland – via the Government’s recapitalisation plan means a significant growth in the amount of money invested and the number of projects invested in, can be expected for this year. However, Enterprise Ireland is not likely to release figures for 2009 funding projects for another 12 months.

“We’re committed to working with our investment partners in building a strong, self-sustaining indigenous venture capital industry in Ireland,” said Enterprise Ireland’s director of corporate and investment services Feargal O’Morain. The majority of investments are made in communications, life sciences and software.

The current seed and venture capital programme – running from 2007 until 2012 – involves state commitment of €175m, across a range of funds. In total, these funds currently have around €500m in combined available capital. Enterprise Ireland is still negotiating for partners on two funds, which will boost this figure further. The value of the two main partner funds have been boosted on the back of the recapitalisation of the banks, earlier this year. The AIB Seed Fund has increased in value from €30m to €53m and a new €25m Bank of Ireland seed and early stage equity fund has been created.

“The investment pipeline for these funds remains strong, which is a very encouraging feature given the current difficult economic environment. Enterprise Ireland continues to work closely with the venture capital sector, the banks and the European Investment Bank to secure finance for Irish enterprises,” said Mr O’Morain.