Simon Hollywood, the firm's corporate specialist attended the ninth annual InterTrade Venture Capital Conference in the Waterfront Hall in Belfast on 26th May 2010. The conference showcased the current sources of equity capital available, across 11 active funds, with access to more than €275m worth of equity. All the major players within the venture capital industry in Ireland were in attendance. The conference was attended by companies from across the island that shared their views on the challenges involved in raising equity. Leading entrepreneur turned investor, Dublin-based Bill McCabe from Oyster Technology Investments, also shared the secrets of his success. The Northern Bank was principal sponsor of the event, which was also supported by Kernal Capital and Crescent Capital as associate sponsors.

The ‘back to basics’ theme of the conference this year focused on raising the early rounds of equity for early-stage companies.

Interestingly in a survey of investors at the conference, InterTrade Ireland found that 77% are cautiously optimistic for concrete prospects for investment in the market and 83% of investors surveyed will make their next investment within the next three months.

What is clear from the conference is that a gap in funding has developed for start-up businesses with venture capital firms moving away from backing very early stage companies which are seen as high risk in recessionary times. This gap in seed funding has become more pronounced as venture funds move up the ‘food chain’ to later-stage deals, which has made it even harder for young companies to secure the necessary funds required to get their business off the ground.

Unfortunately the sources of seed funding have diminished during the recession. As the supply of private investment in companies (amongst BES, friends and family and wealthy individuals) has decreased dramatically, the case for sustained government support in this area is greater than ever. Another revelation at the event was that a key challenge for many companies seeking capital is that they are not “investor ready.”