Irish tech start-ups had a record-breaking 2021 with €1.6bn raisedLeigh Mc Gowranon April 14, 2022 at 05:00 Silicon RepublicSilicon Republic

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2021 was a record-breaking year for Irish tech funding, with €1.6bn total raised from 292 companies, a 60pc increase in funding compared to 2020.

That’s according to the latest Funding Review from TechIreland, which showed new records being hit across Irish tech sectors, in both the number of deals and the size of investment rounds.

In total, 12 companies raised more than €30m last year, which is a large increase from 3 companies in 2019. A new record was reached with 46 companies raising between €5m and €30m.

Despite the challenges of the Covid-19 pandemic, 118 companies raised early-stage rounds, which TechIreland said is back to pre-Covid levels.

“2021 was a landmark year for Irish tech with records broken across all sectors and stages of growth,” TechIreland CEO John O’Dea said. “At a time of rising international tension, it is great to be the bearer of good news.”

O’Dea added Enterprise Ireland “led the charge” with early-stage investment. The State agency invested more than €28m in 125 Irish start-ups last year, which included 82 high potential start-ups. Last year, Enterprise Ireland was recognised as one of the most active investors in Europe and globally.

Enterprise Ireland banking relations manager Donnchadh Cullinan said: “The increase in investment last year across the board has shown that while the pandemic interrupted the normal start-up cycle for everyone; the fundamentals of investment still hold and, as in previous years, good projects will always attract interest from investors.”

A report from TechIreland on 2020 figures indicated that seed funding deals were drying up in Ireland. However, this sector seems to be making a comeback as the number of companies raising up to €1m increased by 10pc last year.

A number of new funds have been launched this year aimed at Irish start-ups. Last February, the Government launched a €90m investment fund aimed at Irish start-ups. This fund will be managed by the European Investment Fund, which will be structured on a fund-of-funds basis led by Enterprise Ireland.

Last week, Dublin-based venture capital firm Delta Partners announced a new fund with a target close of €70m, to back 30 early-stage technology businesses in Ireland.

Bank of Ireland head of technology Paul Swift said funds like these “will provide a level of certainty in terms of potential access to capital for the pipeline of Irish high-growth tech companies”.

Health-tech tops the charts

Similar to previous years, the health-tech sector attracted the most funding. 74 companies in this sector raised €623m last year, a 50pc increase from 2020. The medical device subsector saw massive growth as 22 companies raised €264m, which is an increase of 265pc.

Enterprise solutions came second and was the largest sector in terms of investment rounds, as 84 companies raised €363m.

Fintech was next as with 29 companies raising €265m, up from €186m the previous year. The biggest investments in this sector were Carne Group’s €100m investment from Vitruvian Partners and Wayflyer’s $76m Series A funding round.

E-commerce saw a sharp funding increase as 36 companies raised €100m last year, up from 14 companies that raised €33m the previous year.

The SaaS sector continues to grow rapidly, raising €315m last year among 44 companies. This represents a 60pc increase to 2020, which was 67pc higher than the previous year. Companies focused on AI hit a new record with €171m raised.

However, big data, IoT and AR/VR sectors all saw a decline in funding. The AR and VR sector in particular saw a huge drop, from €45m raised in 2020 to only €3.5m last year.

The ten largest investments accounted for half of the overall funding raised, with the top three all going to the health-tech sector. These were Mainstay Medical raising €131m, LetsGetChecked’s $150m funding round and GH Research’s $125m fundraise.

Women founded tech start-ups also saw a large boost, as 55 companies led by women raised €230M last year. The figure shows a dramatic increase from 2020, when investment into women-founded companies reached a record €105m. However, this amount is still only 13pc of the total amount raised last year.

Similar to previous reports, a regional imbalance of funding was apparent, with Dublin taking more than 75pc of the total funding last year. The biggest win outside of Dublin was Cork-based Teamwork, which raised $70m in its first funding round.

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