Enterprise Ireland will invest €95 million (£74.8 million) in 12 new venture capital funds, which is expected to leverage an estimated €400 million for investment in start-up and early-stage businesses. More than half the money available will have a regional or sectoral focus, according to the Department of Enterprise, Trade and Employment.

The recent tightening of the venture capital market has made it more difficult for companies to access seed finance and, particularly, second and third-round finance, said the Tánaiste and Minister for Enterprise, Trade and Employment, Ms Harney.

"This difficulty is exacerbated in the regions outside Dublin, which do not have the scale or vibrancy of the Dublin venture capital market," said Ms Harney.

"The primary objective of the new funds is to provide equity finance for seed and early-stage companies that face market gap problems. This is particularly the case with many high-tech companies that have significant needs to fund their development, but may have difficulty in sourcing bank finance. Furthermore, there is some evidence that companies located in less economically developed areas have difficulty in sourcing equity finance."

Some €57 million of Enterprise Ireland's commitment will be allocated to funds whose investment focus is on companies at start-up or early stages of development.

"The support of a positive venture capital market is vital to the development of business. It is also important that the private sector should become the lead players in providing such important funding at those critical points in the development of success-driven business," the Tánaiste said.

Enterprise Ireland's executive director, Mr Pat Maher, said the aim of the 12 funds was to continue to develop the seed and early-stage venture capital industry by creating liquidity and competition in the marketplace.

"They will specifically target companies that are: at early stage development; seeking smaller investment amounts; located primarily in regions outside Dublin; and operate in new sectors such as biotechnology," he said.