THE GOVERNMENT HAS announced a new seed and venture capital scheme worth €175 million.
The aim of the scheme is to target high-growth Irish companies, the Minister for Jobs, Enterprise and Innovation, Richard Bruton TD, said.
The Seed and Venture Capital Scheme 2013-2018 is aimed at providing additional funding for high-growth Irish companies with the potential to generate large amounts of additional export sales and grow jobs.
Interest
The first call for expressions of interest from venture capital funds seeking investment was put out today.
Minister Bruton is targeting an additional €525million in funding from the private sector, which will mean a total of €700million available for investment over the lifetime of the scheme. It is expected that the average initial venture investment in a company made by the funds targeted under this call could be of the order of €2million.
The announcement marks the delivery of a key commitment under the Action Plan for Jobs 2013.
Under the Scheme, the Department of Jobs, Enterprise and Innovation, through Enterprise Ireland, will make funding available for investment in private seed and venture capital funds. These funds will invest in high-growth Irish companies in fast-growing sectors including ICT, life sciences, high-tech manufacturing and the green economy.
This first call for expressions of interest will see Enterprise Ireland committing up to €100m to venture capital funds targeting investment in the wider ICT and life sciences sectors.
It is expected that over the lifetime of the scheme it will benefit hundreds of Irish companies, generate tens of millions of euros in additional export sales and create thousands of jobs. Further expressions of interest will be issued over the next two years.
Minister Bruton said:
A key part of the Government’s plans to support Irish businesses is to provide access to credit for a range of different types of businesses, from micro-enterprises employing fewer than 10 people up to mid-sized and large engineering companies in need of development capital.
He added that “these are the companies that could develop into the next major success story for the Irish economy”.
Speaking on RTÉ’s Morning Ireland this morning, Burton said that two-thirds of jobs come from enterprises under five years old, and that over time this scheme will support 200 companies.
There has “always has been a gap for seed money”, said Bruton, and the reason the State is investing in this is because venture capital is “hard to raise at the moment”.
He said they would hope to attract €3 for every €1 put in and that “with the banks retreating we’ve had to step in with new interest”.
A condition of the funds is that for every €1 Enterprise Ireland puts in, €2 has to be invested in Irish-based companies.
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