In short
- 18 venture capital (VC) deals closed in Ireland in Q3'23, worth $244 million, representing a 126 per cent increase from Q3'22.
- A diverse range of start-ups continued to attract VC funding in Ireland during Q3'23, although at relatively small deal sizes.
- VC activity in Q3'23 was skewed significantly by one large deal – TechMet, a Dublin-headquartered critical minerals investment company, raised $200 million.
- The Q3'23 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.
18 venture capital (VC) deals closed in Ireland in Q3’23, worth $244 million, representing a substantial 126 per cent increase compared to the same quarter last year, which saw $108.2 million recorded across 28 VC deals. It was also an increase on Q2’23 ($172.5 million) but a reduction in companies funded compared to the previous quarter (33). According to the latest KPMG Venture Pulse Q3’23 report, Ireland continues to see deal activity at smaller deal sizes except for a major $200 million raised by critical minerals investment company TechMet.
Lowest global VC investment
Global VC investment fell from $81.4 billion across 9,563 deals in Q2’23 to $77.05 billion across 7,434 deals in Q3’23 as VC investors continued to act cautiously, taking much longer to make deals than in recent quarters, intensifying their due diligence, business models and the paths to profitability of start-ups looking for investment. Both total global investment and deal volume reflected multi-year lows; VC investment in Q3’23 was the lowest since Q3’16 while VC deal volume was the lowest since Q2’19.
The Irish market in Q3'23
Four deals accounted for 91% of all Irish VC investment this quarter, with one deal, the $200 million raised by critical minerals investment company TechMet accounting for 82% of VC funds raised. The remaining VC deals in Ireland were relatively small this quarter. The next biggest deal was $10.9 million raised by GoCar, Dublin-based and Ireland's leading vehicle sharing service, followed by Wicklow-based cosmetic surgery practice The Avoca Clinic, which raised $7.6 million and Galway-based Spotlight Oral Care, an oral care brand, raised $3.8 million.
While good companies are still being funded, deal sizes are modest, reflecting the cautious nature of investors right now.
Ireland continues to attract a diverse range of investments
Commenting on VC activity in Ireland during Q3'23, Anna Scally, Partner, Head of Technology and Media in Ireland, said: "Similar to most other countries and regions, investment in Ireland has been reasonably muted this quarter. While good companies are still being funded, deal sizes are modest, reflecting the cautious nature of investors right now. On a more positive note, there has been a perceptible uptick in M&A activity, where companies and investors with deep pockets are taking advantage of depressed valuations and the limited exit options available.”
“It is disappointing though that we haven’t seen more companies secure funding in this quarter as there are lots of excellent early-stage companies developing very innovative products and solutions. The diversity and excellence of the eight finalists in the KPMG Global Tech Innovator Ireland final was a great showcase of some of those start-ups. These start-ups offer various cutting-edge solutions ranging from an AI-powered operating system for the hospitality industry to ground-breaking initiatives in diversity and inclusion, influencer marketing, child protection, and women's health. Best of luck to Conor Sheridan, the founder and CEO of Nory, as he prepares to represent Ireland against 22 other country finalists in the upcoming global showdown in Lisbon on November 15."
Trends to watch for in Q4’23
The last quarter in 2023 will remain challenging for VC investment in Ireland, with VC investors expected to be cautious and hesitant about writing large cheques given the current environment. Investor caution has likely also been partly responsible for the slowdown in fundraising activity as VC firms look to avoid pressure to spend funds raised.
Despite a general slowdown in investment, AI will likely remain very attractive to VC investors, in addition to cleantech, medtech, biotech and energy.
Key highlights – Q3’23
- Global VC investment dropped from $81.4 billion across 9,563 in Q2’23 to $77.05 billion across 7,435 deals in Q3’23.
- VC investment in Europe rose from $16.4 billion to $17.3 billion quarter-over-quarter.
- The Americas accounted for $38.6 billion in VC investment in Q3’23 (a drop from $39.8 billion in Q2’23). The US accounted for $36.7 billion of this total – down from $37 billion in Q2’23.
- VC investment in the Asia-Pacific also dropped from $24.2 billion in Q2’23 to $20.3 billion in Q3’23.
- Global Corporate VC-participating investment grew only slightly from $39.1 billion in Q2’23 to $40.4 billion in Q3’23.
- Global unicorn deal value barely increased but stayed at a low level, accounting for just $15.75 billion in Q3’23—the lowest quarter for unicorn deals in over six years.
- Exit value grew from $53.3 billion in Q2’22 to $82.8 billion in Q3’23.
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
Associate Director of Communications
KPMG in Ireland