Netwatch CEO and co-founder David Walsh clearly did his homework during #IPOready, the inaugural 15-month Irish Stock Exchange programme, from which Walsh graduated recently.
The programme aimed to enhance skills in raising capital, investor relations and business management. Now, just a couple of weeks after graduating, Walsh’s Netwatch announced that it has raised €19.5m in funding to help it grow in the UK and the US.
Netwatch Group, which is headquartered in Carlow, was founded in 2003 by David Walsh and Niall Kelly (CTO). The company sells cloud-based CCTV monitoring and security systems. Once intruders are verified on a customer site, Netwatch personnel can verbally alert the intruders that they are being watched with a personalised warning.
Netwatch employs over 150 staff and operates in four continents, with clients across Europe, South Africa, the Middle East and the USA.
The firm’s latest funding round is from BDO Capital Fund, which is investing €9m, while Bank of Ireland is providing the other €10.5m in debt financing. As part of the investment, Sinead Heaney, investment director of BDO’s €75m Development Capital Fund, has joined the Netwatch Board.
In Association with
Currently Netwatch’s largest funding round to date, the company previously raised around €5.5m through various fundraising rounds, including €2.5m from EIIS investors in 2014.
Strong Growth
Netwatch’s revenue grew by 14% in 2014 to €9.6m and it booked a net profit that year of €1.4m, a year-on-year gain of 44%. Last year, David Walsh said that he and co-founder Niall Kelly were mooting a possible IPO, after discussions with the Irish Stock Exchange that put a value of some €250m on the firm.
Speaking about the €19.5m fundraiser this week, Walsh said: “In the middle of the recession, we focused on research and development and expanding the business internationally.
“This funding announcement is validation of that decision and also lays the ground work for the next three years. The Netwatch value proposition is well received in the USA and this investment will enable us to capitalise on the great opportunity that the US presents. We are confident that we can double the size of the company over the next three years.”
Andrew Bourg, investment director of the BDO Capital Development Fund, commented: “The Netwatch Group, led by its ambitious management team, has proven itself as a premium provider of remote video monitoring and security systems both domestically and internationally.
“It now has significant and exciting growth opportunities to further scale internationally, which is what the BDO Development Capital Fund is designed to both accelerate and support.”
Also commenting on the announcement was Enterprise Ireland’s CEO, Julie Sinnamon. She said: “Enterprise Ireland has supported Netwatch through funding and participation in the stock exchange IPO programme. The investment fund will enable company to further expand in global markets.”
Netwatch was advised by EY and William Fry, while Eversheds acted for Development Capital. The fund is managed by Development Capital, a 100% subsidiary of BDO.
The BDO Development Capital Fund forms part of the government’s Development Capital Scheme, an initiative through which a total of €225m is being made available to mid-sized Irish companies with significant growth potential.
As part of the scheme, €75m in funds from the Department of Jobs through Enterprise Ireland will be matched with €150m of private sector funding for investments in Irish companies through a series of different funds.
Photo: Netwatch CEO David Walsh (left) and Andrew Bourg, Development Capital
