Value of VC deals drop 59% in Q3 amid global slowdown
The value of venture capital deals in Ireland dropped 59% between July and September, compared to the same period last year.
Data compiled by KPMG Venture Pulse shows 28 deals worth $100.9m were closed during the third quarter.
The researchers blame the performance on muted global activity in the space, which fell from a five quarter high of $95.5bn in the April to June period to a near seven year low of $70bn in the third quarter.
This, they claim, was due to ongoing geopolitical conflicts, anticipated seasonal investment lulls, uncertainty in US politics ahead of the Presidential election and an ongoing drought of exits.
“Following a strong Q2’24, VC investment in Ireland saw a significant slowdown in Q3’24, as both traditional and corporate VCs pulled back,” said Anna Scally, EMA region head of technology and media at KPMG.
“However, the recent announcement by the Government of a new Seed and Venture Capital Scheme, set to operate from 2025 to 2029 will inject a record $275 million into the ecosystem and offers a promising boost.”
“Administered by Enterprise Ireland, this scheme will provide essential funding for early-stage Irish companies. As VCs continue to seek opportunities to support scaling businesses, this initiative will be vital in fostering growth and innovation.”
The biggest deal in the quarter was a $15m fundraising by Luminate Medical, the Galway medtech firm.
Loci Orthopaedics, also based in Galway, raised $13.8m.
Ms Scally said budget changes that expanded Capital Gains Tax relief for angel investors, will help those trying to grow start-ups.
“The reduced CGT rates of 16% (or 18% through partnerships) apply to investment gains, and the lifetime limit for relief has been increased from €3 million to €10 million,” she said.
“With the increased relief cap, investors should have greater motivation to inject capital into early stage companies, helping them scale and, in turn, contribute to the Irish economy’s growth.”
“That said, certain of the terms and conditions applying to the relief are not ideal, and it is hoped that they can be improved in subsequent budgets.”
Article Source – Value of VC deals drop 59% in Q3 amid global slowdown – RTE
