Monday 22 July 2019

Tech start-ups' €220m bonanza as funds pour in from investors

€44m round for Intercom leads the way as Irish firms double the sum raised in a year

CEO and co-founder of Intercom Eoghan McCabe
CEO and co-founder of Intercom Eoghan McCabe
Adrian Weckler

Adrian Weckler

Irish technology start-ups are seeing an unprecedented surge in cash as international investors cool their interest in mega-companies, such as Dropbox and Snapchat.

In the week that Dublin software firm Intercom closed a landmark €44m fundraising round, research by the Sunday Independent shows that Irish tech firms have more than doubled the amount of money they raised, compared to a year ago.

In the last 12 months, the top eight Irish tech fundraising rounds have brought in €220m of investment - more than twice the €99m recorded by the top tech firms in the previous year.

In a sign that Irish tech companies are starting to compete more seriously with international rivals, the majority of the new funding is coming from US and European venture capital firms looking for alternatives to overheated US tech stocks.

Three companies alone - Limerick's waste-management firm AMCS, Dublin chip design company Movidius and Intercom - raised €127m in the period, which is the highest annual Irish investment tech haul in recent history.

The fillip in funding here comes as many Silicon Valley tech companies are experiencing sharp falls in their valuations through a series of weak IPOs and fundraising 'down rounds'.

Some international indices show an acceleration in Irish commercial technology activity that is outpacing other countries.

A global analysis by UK-based Mooreland Partners shows that Ireland had the second-highest number of tech company 'exits', or sales, per capita in 2015.

In the last 12 months, the cream of Ireland's private indigenous tech companies have seen an average investment of €27.5m per fundraising round, up on the previous year's average of €12.4m.

Speaking to the Sunday Independent after his company's €44m funding round, Intercom vice-president Paul Adams said that the current cooling-off in tech valuations had not affected the five-year-old firm's prospects in raising money from major Silicon Valley backers.

"Because our growth is so strong, there has been a lot of interest," he said. "The terms looked good. We are now fully funded and will not need to raise money again."

Intercom's co-founder and chief executive, Eoghan McCabe, said that the company had turned down five acquisition offers "so far".

Sunday Indo Business

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