Kernel Capital, through The Bank of Ireland Kernel Capital Growth Fund II, is investing €1.8m investment in Dublin City University spin-out company Pilot Photonics.
Photonics is used in manufacturing, medical devices, telecoms, security and even for scanning people's grocery items.
Pilot Photonics' innovative technology is based on more than ten years of pioneering research and development undertaken at DCU, Trinity College Dublin and Tyndall National Institute in Cork.
The company is led by CEO William Oppermann and CTO Frank Smyth.
William Oppermann was founder of Kernel Capital portfolio company MPSTOR which was successfully sold to Sanmina in 2016.
Leo Clancy, chief executive of Enterprise Ireland, said that Ireland was early to recognise the importance of photonics and has invested heavily in photonics R&D for more than 25 years.
"Pilot Photonics is leveraging that state investment in early-stage R&D to create advanced technology products with global potential," he added.
"The world we know today would not exist without photonics and the influence of the technology will grow even further as it converges with advances in Artificial Intelligence, delivering new applications across a broad spectrum of markets including telecoms, healthcare and autonomous vehicles, Denise Sidhu, a Partner with Kernel Capital, said.