Animation Ireland, the trade association for the industry, currently has 23 member studios.
One of these is Pink Kong Studios, co-founded by Niamh Herrity and Aoife Doyle in 2014.
They are part of a newer generation of animation studios.
Ms Herrity credits established studios such as Cartoon Saloon, Brown Bag, Kavaleer, and Jam Media for getting the ball rolling for the next wave, something for which she says they will be “forever grateful”.
The previous generation which started up in the mid to late 1990s were American companies.
The studios Sullivan Bluth, known for The Land Before Time, and Murakami Wolf, which made the popular TV series Teenage Mutant Ninja Turtles, eventually pulled out of Ireland.
The industry has changed since those early days, says Paul Young, who co-founded Cartoon Saloon with Tomm Moore and Nora Twomey in 2000. The big challenge in animation is around funding.
Instead of having large studios funded by private investment, he says studios now need to go to the international market to raise money for television series and feature films.
The Irish Film Board “are brilliant”, but can not fund every project, he says.
The downside of tapping investment from media giants like Disney is that the studio has to give away the rights, Mr Young says.
Cartoon Saloon puts its focus on making its own television series, raising the money in a “scrappy” way, from a mix of broadcasters such as RTÉ and from private investors overseas.
Ms Herrity says a challenge for Pink Kong is balancing the development of film and television projects with the commercial “bread and butter” work, including advertising, corporate videos and service work on television series.
Ms Herrity and Ms Doyle started out with small projects before taking a lease on a studio in Liffey Trust building in the Point Village in the Dublin docklands.
From the initial two-person team, Pink Kong has grown to a crew of 15. As well as working on a television series for RTÉ, it is currently developing a short film series called Urban Tails.
It features urban animals in 52 cities around the world, including leopards in Mumbai and boars in Berlin.
The pilot episode, which featured foxes rapping in Dublin, aired last year on RTÉ.
Success doesn’t happen overnight. Mr Young says animation can be “a very long tail sort of game,” with an animated film or television series taking an average of two to three years to make.
However, by targeting new territories, animated features, and in particular family and children’s movies, can recoup their costs and make money, he says.
The Oscar-nominated Secret of Kells continues to bring in revenue for Cartoon Saloon, as the animated feature film launches this year in Japan.
Cartoon Saloon is finishing production on Breadwinner, a feature-length animation on which Hollywood star Angelina Jolie is executive producer.
It is based on the children’s book by Deborah Ellis and tells the story of Afghan girl Parvana growing up under Taliban rule.
It is also working on a production for Amazon called Pete the Cat, based on the popular series of picture books.
It recently opened Lighthouse Studios at its base in Kilkenny, to concentrate on service work based on Cartoon Saloon’s reputation.
Ms Herrity attributes Ireland’s success to a winning combination of artistically driven talent and the Irish penchant for storytelling.
Then there are the tax considerations and incentives.
The Section 481 tax incentive for film and television gives investors a 32% relief making Ireland really competitive.
“If you mix a massively talented country with sources of finance it’s kind of a no-brainer for international companies,” she says.
Ms Herrity, who is on the board of Animation Ireland, says the challenges change as the industry grows.
“While last year we would have been pushing Ireland as a place to get co-productions done, to get TV series and film made, this year the big push is around recruitment.”
Coming together as a group under Animation Ireland has helped to crack the markets, Mr Young says.
Support from Enterprise Ireland and, in particular Eileen Bell, has made it easier to pitch at big industry events such as Annecy in France.
The Irish industry was in the spotlight at Cartoon Forum in Toulouse last year, with two of its eight projects in the top five pitches to 950 investors and broadcasters.