Concern over state’s support for start-ups
“If I were deciding on areas in which we should be putting more effort, it is to drive start-ups,” said Professor Patrick Cunningham.
Taoiseach Brian Cowen made much during his recent visit to New York of Ireland’s ability to promote entrepreneurs and new companies.
“Start-up business activity in Ireland is one of the strongest in Europe,” he declared.
Mr Cowen told business leaders Ireland’s economic growth was driven by a combination of “entrepreneurs and ideas, traditions in research, close cooperation between business and academic and good access to venture capital”.
But Prof Cunningham has painted a different picture, voicing doubt about the ability of the existing structures to encourage start-ups.
Appearing before the Oireachtas committee on enterprise, trade and employment recently, he was asked if there were enough incentives in place to encourage overseas companies to locate research and development facilities here.
Prof Cunningham indicated that was largely an issue for the Industrial Development Authority, but said he understood the answer was “yes”.
However, he added: “Where I would have more doubts is in driving the research through into start-up companies and initiatives in this country.”
Prof Cunningham said he had visited Israel last December at the invitation of his counterparts there.
“That country, which in some ways is more unfavoured than ours, has 154 companies on the Nasdaq [stock market]. Those are companies that grew out of technology and attracted money from the international market. We have seven companies on the Nasdaq,” he said.
“The difference I observed there was the purposeful way in which they have primed the financial industry, and I do not mean just state money, with a degree of state support and risk-taking and harnessed that to purposeful programmes in each of their universities and research institutes to drive the ideas out of the laboratory and encourage people to take them to the market.”
Prof Cunningham said Ireland had “much to learn” from the Israeli system of incubator units.
“They have built approximately 1,000 companies in the past 10 years, about 100 per year, in these ‘incubators’.
“They have 20 incubators in a country with about the same population as Ireland and more than half of those have gone on to raise money from the commercial markets, which is a good measure of success.”
