A new €20 million Irish venture capital fund has been established to invest sums of up to €2 million in start-up technology companies.
The Frontline Ventures Fund, to be managed by Dublin- and London-based Frontline Ventures, includes a €9 million commitment from Enterprise Ireland, with the remainder sourced from wealthy individuals and family offices, or private companies that manage the assets of individual families.
It is understood that Declan Ryan, son of Ryanair founder Tony Ryan, has provided some of the funds.
Frontline Ventures is run by partners Shay Garvey, Will Prendergast and William McQuillan.
The new initiative forms part of the Enterprise Ireland Seed and Venture Capital Scheme 2007-2012 and will focus on the software sector. Investments will be made in early-stage companies, with funds available ranging from €100,000 to €2 million. The fund could expand in size in the future.
Encouraging
Minister for Jobs, Enterprise and Innovation, Richard Bruton, last night said venture capital funds were "central" to the Government's plans for encouraging employment.
“To continue the support and creation of innovative and internationally-oriented start-ups that can go fast to market and scale, we must increase the availability of venture capital to facilitate company growth and job creation,” he said.
The €9 million allocated by Enterprise Ireland to the new fund has been sourced from a €20 million sum that Mr Bruton last year said was still available from the 2007-2012 venture capital scheme, with the remaining €11 million expected to be allocated to other initiatives shortly. Mr Bruton has since announced the establishment of a new scheme extending to 2018.
Pension funds
Separately last night, the Irish Venture Capital Association called on Irish pension funds to invest 2 per cent of their capital in fast-growing indigenous technology companies. Addressing the association's annual dinner in Dublin, chairman Mark Horgan said that if just one in three pension funds invested 2 per cent of their capital in the domestic economy, some €500 million could be injected into Irish SMEs.
Mr Horgan, a partner in venture capital house Atlantic Bridge, said the investment could be made through venture capital funds. He believes this strategy would help to counter a trend of Irish firms “selling out” before their full potential can be reached.
“By building Irish winners, we will produce serial entrepreneurs. These entrepreneurs will create and fund further start-up opportunities with the potential to make Ireland the innovation hub of Europe,” said Mr Horgan.
