Dublin startup Noa News enables customers to listen to journalism rather than read it. For launch capital, the founders passed the hat around using the Employment and Investment Incentive, writes Darren O’Loughlin

Podcasters and music streaming services such as Spotify have both beaten a path to market that audio journalism is keen to follow. Dublin startup Noa is an early mover in this field in Ireland, following an audio trail blazed by The Economist since 2007.

Noa has been securing big-name publishers to feature on its platform, while building out its team with the help of funding raised through the Employment and Investment Incentive. The venture is a good example of how a savvy startup can use EII to secure investment capital to fund its crucial early and growth stages.

Noa, an acronym for News Over Audio, was founded in 2015 by Shane Ennis and Gareth Hickey and they launched the platform in 2017. Noa partners with publications to record written features, comment pieces and other articles from the publication in question, using professional readers. These audio files are then made available via an app platform, which can group them by category, publisher or theme.

Before forming the business, Ennis (29) worked in eBay and Hickey (28) was an equity analyst. “We could see the market opportunities for audio journalism based on people’s willingness to listen to all sorts of content digitally,” says Ennis. “The selected articles Noa narrates are not short news pieces but longer articles that benefit from this narrative style.”

Tying down media partners required a lot of effort from the Noa founders, who needed to convince the publications that their narrators would read the pieces neutrally and in a way that was faithful to the rhythms of the writing. “It took about 18 months to get the partnership with the New York Times over the line,” Hickey recalls. 

In Association with

DIY Fundraising

When raising capital, Noa’s founders operated the EII fundraisers themselves, working directly with Revenue rather than stumping up fees and commissions to finance advisors. In 2018, the company raised a total of €600,000 from investors using EIIS. In May 2018, Noa secured €200,000 from ten investors, with the shares issued at a price of €4.15 each.

In August 2018, the company tapped another ten investors for €300,000, this time with the shares priced at €6.49 per share. In December 2018, six investors parted with €94,000, paying €12.25 per share. 

The main investors in the venture include Breon Byrne (€150,000), Paraic Rogan (€69,000), David O’Donovan (€50,000) and Patrick Hickey (€31,000). The founders have also stumped up some cash, but not much. Gareth Hickey invested €5,000 in December 2016, paying 10c per share. In 2017, Shane Ennis also paid 10c per share for 50,000 shares, while in December 2017 Hickey provided another €15,000 equity investment, again at 10c a share.  

In May 2018, prior to the first of the EIIS investments, Ennis bought 52,000 shares for and outlay of €5,200 for 10c per share, while Hickey was allotted 13,200 shares for a non-cash consideration representing “human capital for hours dedicated to the company”. 

Easy To Use

The Noa app is cleanly designed and easy to use, and partners with around 12 publications to feature their articles. Partnering media outlets include the Financial Times, the London Independent, the New York Times, the Irish Times and The Economist. Recent additions include the Harvard Business Review and the Washington Post.

A free account on Noa gives access to three free audio articles per week. The all-content access subscription is priced at €10 per month, and users can listen to the Noa content on Amazon Alexa. Noa also operates enterprise accounts for businesses, with added features such as an analytics dashboard and team-wide roll-out.

The articles are narrated by readers with either Irish, UK or US accents, while Noa’s founders say that they are in talks about expanding the service to include other languages imminently. 

Adding more publications is an ongoing priority for the company, while developing curated playlists for users is also seen by the founders as a key USP. “With the curated playlists, we want to help users engage with a particular topic that may be covered across our publishers,” Hickey explains.

Noa’s team is currently finalising the integration of its web player with the websites of some of its partner publications. Ennis adds that other areas of potential growth include smart automobiles. “We're currently working closely with an automotive maker to build the native in-car applications that live on the car’s own operating systems,” he says.

“We’re adding thousands of users on a daily basis,” Ennis claims, and 60% of Noa’s user base falls into the 18-34 age demographic. “We’re also getting strong traction in the corporate space, especially among corporate legal and financial services firms in Dublin and London. We fit into that time-sensitive demographic who want to stay up to date with business-relevant media articles.” 

Take Care With The Business Plan

The Employment and Investment Incentive allows individuals to reduce their income tax bill on a staged basis over a four year period. The main features of the relief are: 

• The maximum annual relief for an investor is €150,000 and any unused relief may be carried forward to future years.
• The investor must hold the shares for a minimum of four years.
• The fundraising limit for companies is €5m annually, with a €15m lifetime limit.
• The company must carry on a ‘qualifying trade’. Most trades should qualify but there are certain exceptions such as dealing in shares, financing activities, and dealing in development land.

According to Daniel O’Beirne, a tax manager at PwC, the main EII issues that impact on startups and SME on a practical level include:

Self certification: Budget 2019 introduced a self-certification process for EII relief claims. “Although this should make the process more efficient, it does give rise to an element of risk as companies are in effect underwriting whether or not the company qualifies for EII,” says O’Beirne.

Timing: First rounds of funding will only qualify for EII if received within seven years of the commencement to trade. For second or subsequent rounds of funding, the fundraising must be envisaged in the company’s original business plan. Careful drafting of your business plan is therefore critical.

Investments from related parties: Investments in companies controlled by relatives may no longer qualify for EII. However, as an alternative is may be possible to claim the new Startup Capital Incentive. The SCI is similar to the EII in many ways but the qualifying investment is capped at €500,000.

Personal holding companies: Personal holding companies potentially have a number of tax advantages for founders and investors. According to O’Beirne, they can cause issues for EIIS relief where the founder or investor holds a controlling shareholding (for example via their personal holding company) in the company seeking to qualify for EII.

Photo: Noa News founders Gareth Hickey (left) and Shane Ennis