The Irish venture capital industry has seen something of a renaissance in recent years after a period in which some long-standing VC funds re-oriented away from traditional venture capital toward the private equity markets, with mixed success. It remains the case that making money in VC can be difficult and the Irish VC firms have a number of challenges including scale, reach and value proposition. That said there are a number of players in the Irish VC market who are able to add significant value to their fund’s investments.
The role of Enterprise Ireland is significant for firms looking to raise funds from VCs and, as time goes by, the network and strategic assistance that Enterprise Ireland can offer to its client companies is coming to be seen as equally (if not more) important than the funding that they are empowered to award.
In addition, there is a vibrant and growing angel investor sector which is becoming a useful adjunct to the traditional mainline VCs. The combination of angel and VC investors allows the VC firms to focus their expertise on areas such as legal and financial due diligence (where they excel) and the angels to focus on giving support to investee management teams.
Nevertheless the deal cycle remains longer than is probably ideal and the need for companies and investors to select with care lawyers and other advisors who are pragmatic and focussed on achieving the parties’ end goals remains paramount.
Peppe Santoro’s representative experience in this area over the past 10+ years includes:
- advising a consortium of leading Irish VCs on an investment in a promising health sector investment;
- advising a second tier VC on an investment in an Irish company operating in global television markets;
- representing a business expansion scheme (BES) fund investing in an Irish food manufacturing company;
- advising many companies on investments structured as ordinary equity, participating preferred equity, loan notes and straight loan finance; and
- advising angel and other private investors on actual and potential investments in various companies (both alongside VCs and on a standalone basis).