Among the big-name multinationals recruiting at Career Zoo, there were 1,500 vacancies in lesser-known Irish companies, giving graduates an opportunity build with their careers at the cutting edge, writes CIARA O'BRIEN

AS A TECH HUB, Ireland isn’t doing too badly. With some of the top tech firms in the world locating here – Google, Facebook, Twitter, Microsoft to name a few – the country is fast attracting high-tech talent.

But there is another side to the story. Indigenous technology firms are a success story that may have been overlooked in the Career Zoo event in Dublin last month. Among the multinationals recruiting – Amazon, AOL and Twitter were all seeking fresh blood – there were 1,500 vacancies in Irish companies.

It was all part of an initiative backed by Enterprise Ireland to stimulate interest in the sector. Anne Lanigan, senior development adviser with Enterprise Ireland, says part of the reason why indigenous software firms may fly under the radar for many people is that their focus is often on the export market.

“I think people generally aren’t aware of the sort of innovation that’s coming out of Irish software companies,” she says. “Some 75 per cent of what they deliver is exported.”

It’s an issue that the Irish Software Association (ISA) is also to address.

“A lot of young people, when they are thinking about where they want to work in the industry, will think about the major brands, the Googles, the Microsofts, so they don’t naturally think about working with a start-up or early to mid-stage digital tech sector company in Ireland,” says Karl Flannery, chairman of the ISA.

“There are fantastic opportunities available in scaling companies, high growth firms that are based here right on their doorstep.”

The change in the industry is reflected in the interest in the ISA Awards, which will be held on November 9th, applications for which close tomorrow.

The ISA is the representative body for Irish software and digital tech companies, aiming to create an ecosystem of SMEs seeking to transform markets through innovative software and digital technology.

Flannery says there has been a marked increase in the number of companies applying to the awards in recent years.

“In some cases we’re getting 10 to 15 applicants in a category, which is quite phenomenal,” he says. “It’s very vibrant at the moment. The tech sector is one of the shining lights in the economy.

“Everything we’re working towards and how we frame what we do is around scaling agenda for the member companies and the industry generally in Ireland, says Flannery.

He points out though that some of the challenges facing Irish indigenous firms are the old reliables – skills and financing.

The skills element is being tackled in schools and universities and by companies around the country. But the ISA is also getting involved.

“We try to identify as an organisation where there are capability gaps within our member companies and try to introduce new course working with one of the universities. It’s all around the scaling agenda,” says Flannery.

Finance for businesses is a contentious issue. While some reports claim companies are having difficulty getting credit from banks for their day-to-day business, there are other options available to high-tech firms.

From seed capital funds for start-ups and angel investors to venture capital funds looking to invest in the next big thing, the landscape in Ireland is changing.

The ISA is now looking at how the commercial banking sector could work with the high-tech industry, but Flannery says that might require some upskilling on the behalf of the banks to learn how to work with tech companies, including biomedical firms, pharma companies and software businesses.

“They need to figure out how they put new funding models and instruments into place that are suitable for high-growth companies, that are IP based and not asset-backed companies,” he said.

Bringing in specialised banks is a priority for the ISA – that has already begun. Earlier this summer, Silicon Valley Bank said it would lend at least $100 million to Irish companies in the next five years as part of an agreement with the National Pension Reserve Fund. Up to $50 million of that could be distributed in the first year, filling a gap between seed capital for early stage enterprises and later stage funding.

Silicon Valley Bank isn’t the only one that sees the potential in the Irish market. Atomico co-founder Niklas Zennstrom has previously said that the company was actively seeking targets in Ireland.

But Flannery says that there is still a need for a variety in the types of finance on offer to businesses.

“That’s where we’re lacking. We need quite a broad set of instruments. We need a menu of funding options available to companies as they move through their stages of growth,“ he says.

“For the start-ups there’s a lot of stuff going on at the moment. Where we’re finding the gap right now is with companies who have transitioned from focusing on technology and getting their first few customers.

“They’re looking at how to scale the business and putting the right systems in place. That means they need new funding instruments.”

The small market in Ireland means that Irish firms have to look abroad to get any significant growth.

This brings its own challenges. While much is made of the technical skills requirements for the sector, language skills are equally an issue.

“If we want to be successful on the global stage and enter these markets, it’s not good enough to assume that our trading partners will learn English and want to deal with us in English,” says Flannery. “If we want to be effective we have to learn about their culture and their language.”

That could mean bringing languages into schools at an early stage, along with prioritising a few European languages and Chinese.

“I think it has to become a national priority that we get languages on to the curriculum at a primary level, not just secondary school. It’s been proven that children learn a new language under the age of nine very fast, and it becomes harder as they get older.“

There is another obstacle that Irish industry needs to overcome. Although Ireland has a high levels of start-ups – both in the tech sector and in other industries – this isn’t matched by those companies growing into larger enterprises. That’s what the chief executive of the Irish Stock Exchange Deirdre Somers spoke about last week.

In remarks broadcast on RTÉ, Somers said the lack of a rich pipeline of companies was affecting markets on a broad scale, including Ireland.

“Nearly all our high potential companies will be trade sold probably to the US or Asian investors at a very early stage – much earlier than in other countries,” she said.

A recent conference discussed the issue at length. Although Ireland has a strategy around start-ups focusing on innovation and entrepreneurship along with foreign direct investment, there is a lack of strategy around developing companies to become world leaders, Somers said.

“Every market is struggling to attract IPOs,” she said. “It’s a global problem, markets are not delivering to mid-sized enterprises, there’s no doubt about that.”

Flannery says, however, sometimes it is the right outcome for firms to be acquired. “There are definitely situations where it would be fantastic to see some of the companies here scaled to the next level themselves,“ Flannery says. “It’s not straightforward, but we shouldn’t get upset that some companies get to a certain size and get acquired.”

That doesn’t mean that Irish firms shouldn’t think big. Ireland should be aiming at creating companies that have market capitalisation that stretches into billions of euro to help boost the economy.