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Minister for Enterprise, Tourism and Employment, Peter Burke, has published a new report titled Market Demand for and Supply of Scaling Finance in Ireland, revealing a significant €1.1 billion gap in equity financing for Irish enterprises seeking to scale and expand internationally over the next two to five years.
Key Findings
Commissioned by the Department of Enterprise, Tourism and Employment and prepared by SQW Economic Research Consultants, the report highlights:
- A growing demand for equity finance among scaling firms, expected to continue over the coming years
- A particularly acute gap for deals in the €5 million–€10 million range
- Challenges faced by capital-intensive and R&D-driven sectors
- A shortage of patient, long-term investment for firms with extended product development cycles
The study also identifies structural barriers, including undercapitalisation at early stages, limited fundraising capabilities, and risk aversion among firms. On the supply side, Irish funds are significantly smaller than their European counterparts, with average fund sizes of €60–€70 million, compared to the optimal €200–€300 million needed to support scale-up strategies.
Ministerial Response
Minister Burke stated:
“Ireland ranks highly in Europe for the number of pioneering start-ups. However, a lack of access to capital is preventing many from reaching their full potential. This report confirms and quantifies the financing gap and will inform targeted policy measures to support scaling firms.”
Methodology
The report’s conclusions are based on:
- An e-survey of 166 potential scale-up firms
- Interviews with nearly 60 stakeholders, including fund managers and entrepreneurs
- Analysis of private market data from PitchBook
- Monte Carlo simulations modelling equity needs across a sample of 1,000 potential scale-up firms
Next Steps
The Department is currently developing proposals to address the identified gap, with Minister Burke expected to bring recommendations to Government later this year.
You can access the full report via the Department of Enterprise, Tourism and Employment’s official website.
