The Irish public are becoming increasingly interested in investing in local firms, potentially unlocking some of the €160bn just sitting in accounts, writes Chris Burge of Spark Venture Funding.
For as long as I can remember, Irish people have been careful with their money. As a result, a very large amount of personal wealth in this country sits in bank accounts. And by “very large amount”, I mean a sum to the tune of €160 billion.
But that could be changing.
“This change will make a real difference to founders and investors alike”
More people are starting to look at their savings and ask whether some of that money could be doing more. And the answer is yes!
By no means am I suggesting a wholesale move into high risk investments. Instead, I’m talking about ordinary professionals who want a small part of their savings to support Irish companies with potential.
At Spark Venture Funding, we have seen this change up close.
Since 2018 we have supported 60 Irish companies in securing growth capital. At the same time, more than 14,000 have taken the opportunity to actively deploy part of their savings.
A significant portion of recent activity has been in the MedTech sector. More than half of our fundraises in the past two years have gone to Irish medical technology companies. AuriGen Medical in Galway is a good example. It recently raised €1.5 million from our community. This takes their total to €6 million raised with us.
Why ordinary professionals are becoming Ireland’s newest venture investors
The type of person behind these investments is an interesting story too.
“Access to high growth Irish companies is no longer limited to a small group of connected insiders”
They are not seasoned angels or well-known investors. They are people who want to support companies they believe in and who want to do it in a structured and sensible way. Many of them are stepping into early stage investing for the first time.
A few things are helping that shift.
The EIIS scheme offers a 50% tax rebate which makes it easier for people to take that first step. We also keep the process straightforward. We do not charge commissions to investors. This means every euro goes directly into the companies raising funds. Furthermore, the fact that the platform is regulated by the Central Bank also gives people confidence.
These investors are not expecting quick returns. They are thinking about the long term. They want to contribute to the growth of Irish companies and they want part of their portfolio to reflect that.
I am not suggesting that the €160 billion sitting in savings will suddenly move into start-ups.
Long standing habits do not change overnight. But we are seeing a steady increase in the number of people who are willing to redirect even a small portion of their savings into homegrown businesses.
The signs are all there that this signals the start of something important.
Ireland is the start of a more participative investment culture beginning to take shape. Access to high growth Irish companies is no longer limited to a small group of connected insiders. We’re seeing ordinary people feel they have a role to play in the success of Irish companies too.
This change will make a real difference to founders and investors alike.
For founders, it will help them access the backing they need to grow. And for investors, it will give them a more active relationship with part of their savings. Finally, it will strengthen the overall ecosystem that supports innovation in Ireland.
We are only at the beginning of this shift. But it is already changing how people think about their money and how Irish companies are funded. I believe the impact will be felt for years to come.
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