INTERNATIONAL venture capital firm Draper Fisher Jurvetson (DFJ) is to open an office in Dublin following the decision by the National Pensions Reserve Fund (NPRF) to invest €30 million in two of its funds as part of the Innovation Fund Ireland initiative.
The NPRF is placing €10 million in the DFJ Fund X in the US and €20 million in the European-focused DFJ Esprit Fund III.
In tandem technology entrepreneur and investor Brian Caulfield has been appointed a partner of London-based DFJ Espirit and will head up its new Dublin office. He said he would be looking to invest in companies operating in all areas of technology and would also work on European deals with other DFJ Espirit partners. Mr Caulfield is a a non-executive director of The Irish Times Ltd.
Innovation Fund Ireland includes €125 million from both the NPRF and Enterprise Ireland which is being used to attract global venture capital funds to locate in Ireland. It is hoped to attract a matching €250 million from VCs which would be used to invest in Irish firms or overseas private firms who may decide to locate in Ireland.
A lack of funding for innovative start-up firms was one of the problems identified by the Innovation Taskforce which reported last March on how the smart economy strategy could be implemented.
Founded in 1985, DFJ is one of the most internationally focused of the top-tier venture capital firms in Silicon Valley. Donald Wood, the DFJ managing director who oversees its global network of funds, said about 40 per cent of its investments are outside the US. It has partnerships with 18 VC firms around the world.
It has backed successful companies such as Skype and Tesla Motors while DJF Espirit’s investments include Lovefilm, Buy.at and Irish telecoms firm Imagine.
DFJ was the first institutional investor in Chinese search engine Baidu, which now has a market capitalisation of over $30 billion.
The NPRF’s investment is being made on purely commercial terms.
“The NPRF want us to make a return for them but they would also like us to pay attention to Ireland which we will do,” said Mr Wood.
Mr Wood said there wasn’t a “deep knowledge” of Ireland’s economic situation in the US “but people have a sense that there was a serious financial crisis that rocked the ship on the same level as Greece”.
Despite this he said Ireland could recreate the entrepreneurial culture of Silicon Valley, given the large pool of local talent that has worked with multinationals such as Cisco, Google and Intel.
DFJ is working with the IDA to identify if some of the companies it has invested in could establish European headquarters in Ireland.
