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Now there's €40m up for grabs if software's your bag

Venture capitalists get An Post, Irish banks to stump up cash for tech startups.

AN IRELAND-BASED COMPANY that invests in tech startups has pulled together €40 million to pump into new software firms.

Venture capital fund Frontline Ventures has pulled the money together from investors including An Post’s pension fund and Allied Irish Banks, the Irish Times reported today.

Other investors in Frontline, which has offices in Dublin and London, include Enterprise Ireland (EI), the government body which helps grow Irish businesses in overseas markets, the newspaper said.

Frontline twitter Source: Frontline/Twitter

The company provides injections of up to €2 million to software-only startups in the “series A” stage, or the first main round of funding, and “seed investments” of up to €750,000 to get businesses off the ground.

Frontline has issued a guide to Irish tech startups called, believe it or not, The Irish Tech Startup Guide.

Frontline says it has invested in several tech startups so far including Dublin-based international money transfer service CurrencyFair, which has recently been advertising for new staff in its Irish and Australian offices.

Other beneficiaries of its venture capital include California-headquartered Boxfish, which captures and sifts through TV data and runs a research-and-development centre in Dublin.

And venture capital is…

Small companies often struggle to get money from traditional lenders, like banks, in their early days so well-off individuals or firms like Frontline can offer a different route to a cash injection for startups.

Investors who see the potential in a startup provide their “venture capital”  in return for a stake in the company and potentially a say in how it does business.

No guarantees

EI last year lost €16.8 million on its investments, the lion’s share from companies which had gone under or were in receivership.

The rest of the losses came when businesses it had invested in were eventually sold for less than the price EI had paid for a share in the companies.

At the time, EI chief executive Julie Sinnamon said: “If we could at the very start pick the companies that weren’t going to make it, it would be a terrific situation”.

Enterprise Ireland Annual Reports Source: Laura Hutton/Photocall Ireland

READ: Companies received €5m more in venture capital from Enterprise Ireland last year

READ: 32,000 people set up a new business in Ireland last year

About the author:

Peter Bodkin  / Editor, Fora

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