Irish Tech reaches new record number in 2021

The new TechIreland report shows that Irish tech funding in 2021 reached a new high of €1.6 billion with a record number of 292 companies raising investments. The company published their Funding Review 2022 Edition sponsored by the Bank of Ireland and supported by the Irish Venture Capital Association.

Despite the pandemic, 12 companies each raised over €30M last year – compared to 2019 when just 3 companies raised over €30M. 118 companies raised early-stage rounds, back to pre-covid levels. 46 companies raised between €5 and €30M, a new record. These results underline the strength and innovation capability of Irish tech companies, despite the challenges posed by the pandemic.

Irish Tech Companies Investment

The top 10 largest investments accounted for half of the overall funding raised. Mainstay Medical raised €131M, followed by Lets Get Checked (€123M) and GH Research (€105M). Dublin companies occupy the top ten largest investments. Cork’s Teamwork (€59M) is the only non-Dublin company in the top 10.

Even seed funding, which has consistently been problematic in recent years, grew. The number of companies raising rounds to €1M was up over 10% in 2020.

As usual, Enterprise Ireland led the charge at the early stage and the launch of the new €90M Irish Innovation Seed Fund is expected to provide greater support in 2022. It will result in an additional €200M being available over the coming years.

Angel funding continues to grow. HBAN, the Irish angel network, had its best year to date, closing 71 deals across the island, with angels investing €18.2M as part of rounds worth €118M.

Companies are also tapping diverse sources such as crowdfunding, European Innovation Council, and bank loans, however, Venture Capital remains the dominant source, accounting for more than 95% of the total funds raised.

Like previous years, the HeathTech sector attracted the most funding – 74 companies raised a total of €623M, more than 50%. In the previous year.

Enterprise Solutions was the largest sector in terms of the number of companies, with 84 companies raising €363M. FinTech stood third with 29 companies raising €265M, up from €186M in 2020. Perhaps as a result of covid, eCommerce saw a sharp increase in funding as 36 companies raised €100M in 2021, up from 14 companies that raised €33M in 2020. CleanTech saw a dismal performance despite the global headlines on climate action and sustainability; 7 CleanTech companies raised a combined €12M, down from €173M for 10 companies in 2020. Travel, Education, Telecom and MediaTech were also out of favour last year.

Dublin dominated as always, taking over 75% of the total funding on a region’s view. The East region saw €1.2B invested into about 180 companies. Companies based outside Dublin raised a total of €400M. 33 companies from the West region (Galway, Mayo, Roscommon and Donegal) raised a total of €130M+. 30 companies from the Southeast (Cork, Waterford, Wexford and Tipperary) raised close to €100M. 4 companies from counties Limerick and Kerry raised a total of €25M+.

27 Northern Ireland-based companies raised a total of €83M, significantly higher than the €26M raised in 2020.

Software as a Service businesses set a new record as 44 SaaS companies raised a record €315M in 2021, up from the previous year’s record of €202M in 39 companies. The focus was also on Future-tech. A record 38 Artificial Intelligence companies raised a total of €171 M, up from €121M for 32 companies in 2020.

2021 also saw a milestone in Female Founder Funding as 55 companies led by women raised €230M, up 120% in 2020. Nevertheless, that’s only 13% of the total. We still need to support women-led businesses.

The full report will be on the TechIreland website https://www.techireland.org/.

Responding to TechIreland’s Funding Review 2022 Edition

John O’Dea, TechIreland’s Chief Executive said – that 2021 was a landmark year for Irish tech with records broken across all sectors and stages of growth. At a time of rising international tension, it is great to be the bearer of good news.

Paul Swift of Bank of Ireland said – It is heartening to see a record €1.6B being raised last year and the number of companies that secured funding growing by 11%, despite the challenges of the global pandemic. It was also good to see that the early stage, seed funding environment improved after a few difficult years. New pools of funding like the Irish Innovation Seed Fund and the Bank of Ireland-backed Delta fund will provide a level of certainty in terms of potential access to capital for the pipeline of Irish high-growth tech companies.

Brian Caulfield, Chair at Scale Ireland said – Perhaps surprisingly, as a global pandemic raged, 2021 represented one of the most positive years for funding Irish tech. Not only did the overall total amount raised increase by over 50% to a record €1.6B but the number of companies funded also grew by 11%. Investor confidence has rebounded from the initial shock of the pandemic.

Donnchadh Cullinan of Enterprise Ireland said – The increase in investment last year across the board has shown that while the pandemic interrupted the normal start-up cycle for everyone; the fundamentals of investment still hold and, as in previous years, good projects will always attract interest from investors.

Redmond O’Leary of InterSystems – Changes in consumer banking, spending habits and increased digitalisation among traditional financial institutions present a major opportunity for Irish fintech to build on the growth they have recently experienced.

John Phelan of HBAN – 2021 was HBAN’s strongest year to date. Angels invested €18.2M into 71 deals across the island. Overall HBAN investors have now invested over €140M in private capital into 650 deals.

Martina Fitzgerald of Scale Ireland – It’s vital that the new Irish Innovation Seed Fund, is up and running as soon as possible. We are also seeking changes to incentivise more private investment into early-stage startups, including the introduction of loss relief on EII investments.

Peter Coppinger of Teamwork – The global pandemic has hampered investment in early-stage startups in favour of more established, later-stage companies, but as you can see from this report, there are many paths to growth and to achieving scale.