Funds invested in Irish technology SMEs reached a record high of €1.48bn in 2024.
New figures from the Irish Venture Capital Association (IVCA) VenturePulse report show investment increased by an unprecedented 9% on the previous year.
The association, which marks its 40th anniversary this year, also reported a record fourth quarter in 2024 of €535m, 162% up on the same period the previous year.
Gerry Maguire, chairperson, Irish Venture Capital Association, said: “Growth in the year and final quarter was driven by big investments which demonstrates that Ireland has the capacity to create and scale world class tech firms.”
However, he described the funding environment for firms looking to raise less than €5m as “choppy”.
“Deals right across all sizes below €5m fell during 2024 and in quarter four," he explained.
Artificial Intelligence (AI) accounted for over €100m of the total VC investment into Irish firms last year.
Maguire said that the recent impact of Chinese operator DeepSeek is likely to only increase, the number of VC investors in the sector.
“The arrival of players such as DeepSeek has the potential to boost margins and decrease development costs for AI start-ups," he said.
"We are potentially witnessing the democratisation and ease of participation by AI developers, in the same way that Software-as-a-Service or cloud computing transformed and disrupted the traditional software model.”
He pointed out that the DeepSeek driven sell off of Nasdaq stocks mostly affected big chip makers, or AI platforms of Google, Microsoft and others, not areas in which most Irish AI firms compete. “
"There is massive potential in AI applications across healthcare, climate, education and other sectors, and this will be boosted by lower costs of development which represents a major opportunity for Ireland," he added.
Sarah-Jane Larkin, director general, IVCA said that fourth quarter and annual data emphasised the potential for the new Government to support investment in early-stage companies.
“AI company, Nuritas, for example, raised €42m in quarter four but its first round back in 2015 was just over €100,000. Co Louth based company, XOCEAN raised €115m in this quarter and is now a world leader in sea drone technology," she said.
She said that current global economic and political turbulence, largely driven by the new administration in the US, means that the Government’s latest €250m Seed & Venture Capital Scheme 2025-2029 “couldn’t come at a better time”.
Applications for the first call of up to €100m to be submitted to Enterprise Ireland by the end of this week (February 20).
“This is very welcome as funding for deals below €5m fell sharply across the quarter and the year," she said.
Deals in the €3-€5m range fell by 37% to €82m for the year, and by 56% to €17.6m for the fourth quarter 2024, compared to the same period the previous year.
Funding in the €1-€3m category fell by 24% to €105m for the year and by 63% to €23.6m for the quarter. Investments below €1m declined by 4% to €28.9m for the year and by 19% to €7m for the quarter.
Seed funding, or first rounds raised by SMEs, decreased by 4% annually to €127m and by 55% to €17.9m in the quarter.
The top five deals in quarter four 2024 were: Dublin headquartered medical device company, Fire1 (€116m); Louth based sea drone developer, XOCEAN (€115m); Dublin headquartered travel software firm, Nuitée (€46m); Dublin headquartered AI company, Nuritas (€42m) and Dublin based fintech firm, NomuPay (€35.9m).
Life sciences accounted for 37% (€552.9m) of the total raised in 2024, followed by Software: 13% (€185m); Envirotech: 11% (€161.7m); Fintech: 8% (€119m) and Data: 8% (€115m).
In total 217 deals were completed in 2024, similar to the previous year total of 216.
“In view of global headwinds, we should be ambitious and aiming to double this,” added Ms Larkin.
Pics by Fennell Photography 2024
