Irish technology companies raised €307m in the first half of 2015, 45% ahead of the same period last year, according to the Irish Venture Capital Association VenturePulse survey. Some €187m was raised in the second quarter, according to the study, which is sponsored by law firm William Fry.

IVCA chairman, Brian Caulfield, said that a major explanation for the growth was the creation of a pool of venture capital for later-stage development and expansion. “This is having a very positive impact on the SME funding landscape, resulting in investment of €51m in the second quarter alone.”

Caulfield added: “With continued strong support from international players, growth/expansion funding was 96% of total funds raised in the second quarter. The Irish venture capital community continues to be the main source of funding for Irish innovative SMEs both through direct investment and as the local lead investor for international syndicates, who invested €79m in the second quarter and a total of €142m in the first half of 2015.

"Most of the Irish companies that raised funds from international investors had initially raised capital from Irish VCs.”

IVCA chairman Brian Caulfield

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The IVCA VenturePulse study also found that first-round seed funding remained low, at 4% of total funds raised in the second quarter. The report shows that the seed funds supported by the banking sector and Enterprise Ireland’s Seed & Venture Capital Programme of 2006-2012 are close to being fully invested, with just €7.6m invested in Q2, the lowest quarterly activity since the creation of these funds.

“The government has recognised that these funds need to be renewed if entrepreneurs are to be supported as actively as in the last five years and we are hopeful that new funding will come on stream in the second half of 2015,” said IVCA director general Regina Breheny.

The report also found that since the onset of the credit crunch in 2008, in excess of 1,000 Irish SMEs raised venture capital of €2.3bn.

Added Breheny: “These funds were raised almost exclusively by Irish venture capital fund managers, who, during this period, supported the creation of up to 20,000 jobs, attracted over €900m of international capital into Ireland and geared up the state’s investment through the Seed & Venture Capital Programme by almost seven times.”

Taoiseach Enda Kenny and jobs minister Richard Bruton with Movidius founders Sean Mitchell (left centre) and David Moloney. The Irish-founded tech firm raised $40m in funding earlier this year