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Startup funding squeezed as Covid hits deals

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Barry Napier of Cubic Telecom

Barry Napier of Cubic Telecom

Barry Napier of Cubic Telecom

THE number of Irish startups raising funds during the first quarter of this year fell to the lowest level since the first three months of 2016, according to data from Refinitiv.

Irish companies raised €18m of venture capital in the first quarter of this year, with only eight deals completed.

The amount raised in the quarter was the lowest since the first quarter of 2014, when €8.4m was raised.

In the first three months of 2019, 10 deals were recorded, when a total of €85.8m was raised.

The latest figures represent a 79pc fall in value and a 20pc decline in volume.

The largest Irish deal was for Cubic Telecom - led by Barry Napier - which raised €11m, followed by Payslip and Cerebreon Technologies raising €2.7m and €1.7m respectively.

The most active investor in Ireland was Act Venture Capital. It invested €11.4m in two deals.

Elkstone Capital Partners came second, investing €430,000 in two deals.

"It's been a disappointing first quarter for enterprise in Ireland as the coronavirus continues to take its toll on startup investment as we've already seen with global M&A," said Bebhinn Dunne, Ireland country manager for Refinitiv.

"Despite the easing of [the] lockdown, we expect investment to continue to fall into Q2 and beyond as the economy and business environment slowly begins to recover."

She said investors might increasingly eye "Covid-proof" startups which facilitate home working, or pharmaceutical firms.

Irish Independent