The Western Development Commission (WDC)'s Investment Fund has generated a return close to 2.5 times its original value and provided €3.3bn to Ireland's economy over the past 20 years, new research has found.
The analysis, carried out by economic research and consultancy organisation Indecon, found that the fund had made “an impressive contribution to economic activity in the Western Region and has made a significant contribution to the national economy”.
From an initial Exchequer allocation of €31.8m, the fund is now valued at €73m and has been self-financing since 2010, while the contribution of companies supported by the fund to Ireland's economy since 2001 is estimated at almost €3.3bn.
Companies supported at least 5,300 jobs when economy-wide impacts are considered, and firms have contributed more than €276m to the state in tax.
Furthermore, the research found that companies supported by the firm have made €1.6bn in exports and spent €396m on research and development in the western region.
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The fund provides seed and venture capital and loan finance to companies and community projects across Donegal, Sligo, Leitrim, Roscommon, Mayo, Galway and Clare, and it also co-invests with private sector investors on a commercial basis, with returns reinvested in the region.
Gillian Buckley, Investment Manager at the WDC, the statutory body that promotes economic activity in the western region, said: “The WDC Investment Fund has been a unique source of risk capital, equity and loans, for start-ups, expanding businesses as well as for community or social enterprises in the Western Region.
"It has driven innovation, supported high quality employment and enhanced the quality of life of its citizens. This has been through the provision of range of services for communities such as childcare, social housing, sports and recreational facilities and enterprise hubs.
“The fund has proved a very patient investor and even though investment is a calculated risk, the report shows the very impressive impact it has had on the region. A great number of supported companies have reported that they would not be here today if it was not for the early support of the fund which has helped businesses to leverage further funds.”
Commenting, Minister for Rural and Community Development, Heather Humphreys said: “I welcome this report which demonstrates the very significant and positive impact that the Western Investment Fund has had on the Western Region over the past two decades, in terms of creating jobs and economic prosperity.
“The fund has time and time again provided essential finance to businesses at crucial stages in their development. This has resulted in highly impressive returns for the taxpayer and an ongoing legacy of success and growth for west of Ireland-based businesses and community enterprises.
The Indecon research also found that from 2001 to 2020, more than €61m was invested or lent by the fund to 234 entities including SMEs, community or social enterprises, creative projects and strategic initiatives,
Around 70% of those employed by supported SMEs are graduates, 30% more than the national average, and 96% of companies surveyed indicated that securing funding was either significant or very significant for their organisation.
All community organisations surveyed said that investment fund had enhanced the quality of life of its citizens, and companies supported by the fund tend to have a more gender-balanced leadership team than average.
Tomás Ó Síocháin, CEO of WDC, said: “The WDC Investment Fund was established at a time when there was little investment money available to business to help them expand.
"The remarkable success of the fund over 20 years is to have changed the culture around investment in the region, to help develop key sectors like MedTech and in doing so, to use the profit on investments to re-invest in new business and to lend to communities across the region.”
Photo: (l-r) Tomás Ó Síocháin, Heather Humphreys and Western Investment Fund manager Gillian Buckley.
