In short
- 24 venture capital (VC) deals closed in Ireland in Q1'23, worth $172.8 million, down 57 per cent from Q1’22.
- A diverse range of startups continued to attract VC funding in Ireland during Q1'23, although at relatively small deal sizes.
- Q1 saw no $100m+ deals in Ireland – the most significant deal was a $32 million raised by the Galway-based medical device company Vivasure Medical.
- The Q1'23 edition of the Venture Pulse report produced by KPMG analyses the latest global trends in venture capital investment data and provides insights from both a global and regional perspective. All figures cited are in USD; data for the report is provided by PitchBook.
The Irish market in Q1'23
Irish companies raised $172.8 million in venture capital (VC) investment across 24 deals in Q1’23, down 57 per cent from the stronger Q1’22 quarter, which recorded 25 VC deals worth $401 million, according to the latest quarterly KPMG Venture Pulse report.
The protracted war in Ukraine, increasing interest rates, stubbornly high inflation, domestic and geopolitical challenges, and concerns about the stability of the global banking system all combined to make it a difficult quarter for VC investment across all regions. Globally VC investment dramatically fell from a high of $177.6 billion in Q1’22 to $57.3 billion in Q1’23. However, Irish-founded fintech Stripe raised more than $6.5 billion (€6.15 billion), which was by far the largest VC round of the quarter globally and values the company at $50 billion (€47 billion).
Notwithstanding the inherent risks and uncertainty about the future, VCs realise they still need to invest in early-stage companies. Otherwise, they risk missing out on the next wave of growth companies.
Ireland continues to attract diverse range of investments
A diverse range of startups continued to attract VC funding in Ireland during Q1’23, although at relatively small deal sizes. This quarter’s largest deal was $32 million raised by the Galway-based medical device company Vivasure Medical. The next biggest deal by size was the $25 raised by the Dublin-headquartered medtech company Fire1. Other notable deals include the digital pathology company Deciphex which raised $16 million; social media tracking and predictions company NewsWhip raised $13 million; and cybersecurity firm Siren raised $12 million.
Commenting on VC activity in Ireland during Q1'23, Anna Scally, Partner, Head of Technology and Media in Ireland, said: "One thing that is fairly positive at the moment is that we haven't seen a complete drop off in early-stage deals. Notwithstanding the inherent risks and uncertainty about the future, VCs realise they still need to invest in early-stage companies. Otherwise, they risk missing out on the next wave of growth companies."
Trends to watch for in Q2’23
“Q2’23 will likely be another challenging quarter for VC investment in Ireland and VC investors will likely remain cautious, scrutinising deals carefully to assess whether business models will be resilient, while also putting more pressure on their portfolio companies to cut costs. We anticipate investment to continue in high priority areas, including medtech, energy, cybersecurity, cleantech and ESG.” said Anna Scally.
Key highlights – Q1’23
- Global VC investment was $57.3 billion in Q1’23—the lowest level of quarterly investment since Q2’17, and a sharp decline both quarter-over quarter (compared to $86 million in Q4’22) and year-over year (compared to $177.6 billion in Q1’22).
- VC investment in the Americas was $33.1 billion across 2,542 deals in Q1’23, a decline from $44 billion across 4,050 deals in Q4’22.
- VC investment in Asia dropped from $25.5 billion across 2,799 deals to $13.5 billion across 1,773 deals between Q4’22 and Q1’23.
- In Europe, VC investment fell from $15.7 billion across 2,512 deals in Q4’22 to $9.8 billion across 1,533 deals in Q1’23.
- Global CVC investment was very slow in Q1’23, accounting for $22.8 billion in investment, compared to $42.1 billion in Q4’22.
- Global first-time VC financing was very weak in Q1’22, accounting for just $5.76 billion globally.
- Global exit value dropped more than 50% quarter-over-quarter, from an already low $46.4 billion in exit value in Q4’22 to $20.3 billion in exit value in Q1’23
Get in touch
For further information on this edition of Venture Pulse, please contact Anna Scally, Head of Technology and Media. We'd be delighted to hear from you.
Anna Scally
Partner, International Tax & TMT Sector lead for KPMG in EMA
KPMG in Ireland
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Sandra Farrell
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KPMG in Ireland