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Venture capital funding for Irish technology start-ups and SMEs reached a record €1.3 billion in 2021, new data shows.

The Irish Venture Capital Association’s (IVCA) VenturePulse survey showed a 44 per cent increase over the value of funding recorded in 2020. Funding in the fourth quarter of last year almost trebled to a record €458 million.

“The indigenous tech start-up and SME sector appears to be well positioned to benefit from and contribute to a strong post-pandemic jobs recovery,” said Nicola McClafferty, chair of the IVCA. “Some 57 per cent of funding in 2021 came from overseas investors, highlighting the continuing appeal of Irish tech firms and their ability to compete on a world stage.”

The number of deals was 20 per cent higher in 2021, with 279 recorded compared to 233 last year.

In a boost for the start-up sector, seed funding grew by 60 per cent to €130.7 million.

Deals between €10 million and €30 million were 66 per cent higher year on year, reaching €356 million.

Among the biggest deals were LetsGetChecked’s €123 million raise, which pushed it into unicorn territory, an €89 million raise by Mainstay Medical, and fintech Wayflyer’s €62 million raise. The latter recently completed another major fundraising round, adding €134 million to its tally and pushing it into tech unicorn status.

Third higher

In the final three months of 2021 deals were almost a third higher at 71. Life sciences saw €174 million raised, some 38 per cent of the total during the quarter; software was 17 per cent;, with business services at 12 per cent; and food and drink accounting for 11 per cent of the total.

The under €1 million category saw a 35 per cent decline in the fourth quarter, which the survey attributed to increasing deal sizes.

“We have never witnessed such a wide range of sectors raising venture capital or private equity, reflecting the fact that Irish high-growth SMEs are now more broadly spread and diversified than in the past,” said Ms McClafferty, who is also a partner with Draper Esprit.

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