The latest figures from the Irish Venture Capital Association’s Venture Pulse survey show that €190m was raised in the third quarter of this year, compared to €309m for the same period last year.
The Irish Venture Capital Association (IVCA) claims that the data, published in association with law firm William Fry, should “raise alarm bells” and that funding across almost most levels “fell significantly”.
“Following a strong first half, overall funding for the nine months to end September 2023 just about held up, with an increase of 6pc to just over €1bn, compared to the same period last year,” said Denise Sidhu of the IVCA.
“However, the Irish third quarter data raises alarm bells, as the value of deals across all sizes fell significantly with the exception of those under €1m,” she added.
She said the number of transactions fell by over a quarter (26pc) compared to the corresponding period last year.
The third quarter’s largest deals were the software firm Ocuco (€60m), the life sciences firm Shorla Oncology (€32m), the infrastructure tech firm UrbanVolt (€26m) and the life sciences firm ProVerum (€15m).
The most successful sector raising cash so far this year is envirotech (or clean energy) at €580m, equating to 50pc of total VC investment.
Next comes life sciences at €157m (14pc of total), software at €92m (7.9pc of total), AI at €88m (7.6pc of total and fintech at €82m (7pc of total).
However, the value of deals in the third quarter in the €3m to €5m range fell by over a third (34pc) to €193.8m compared to almost €300m for the same period last year.
Meanwhile, value of deals in the €5m to €10m range dropped by over three quarters (76pc).
Sarah-Lane Larkin, director general of the IVCA, said a worrying indicator was that the value of international VC investment in the third quarter fell by over two-thirds (69pc), or by over €120m.
“The reliance on international VC investors at a time when US venture capital and private equity investment has slowed significantly, emphasises the need for Ireland Inc to build local private funding sources in order to combat global dependence and headwinds,” she said.