KPMG has published its Venture Pulse report for Q3 of 2020, which shows a decline in venture capital activity in Ireland.
$86.6 million was invested in 24 deals involving Irish companies – down from the $187.6 million invested across 73 deals in the same quarter last year.
The figures show that deal volume is also down significantly compared to the same quarter last year, when 73 deals were completed, and is the lowest level of deal volume in Ireland in five years, since Q3 of 2015, when just 22 deals were completed.
Globally, VC investment rose slightly from $70 billion across 5,674 deals in Q2 of 2020 to $73.2 billion across 4,861 deals in Q3’20.
The number of individual VC deals however, dropped for the sixth straight quarter, dropping to the lowest volume seen since Q4 of 2013.
Commenting on VC activity in Ireland during Q3 of 2020, Anna Scally, Partner and Fintech Lead at KPMG in Ireland said it is clear that private equity and venture capital firms are placing big bets on later stage companies.
"The big concern is who is going to fund earlier stage companies, or are they going to be funded at all? In Ireland, we need to make funding programmes more accessible, because if early stage companies don’t receive funding, they will not be capable of securing follow-on investment down the road. That will have a big impact on the ecosystem here," she said.
"It is also clear that the uncertainty created by the Covid crisis has had a significant impact on the number of companies that successfully secured investment in Q3 of 2020. Investors are very focused on supporting their existing portfolio companies and I suspect many are reluctant to increase their exposure at this point," she added.
