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Students rebel against IT
Not so long ago students fought tooth and nail to get into IT courses. Now, they are shunning such studies, with massive implications for Ireland's reputation as a high-tech centre.
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Tech firms still attract most funding
Wednesday, September 25 2002
by John Cradden

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Although overall investment by the Irish venture capital industry in Irish companies fell in 2001, the proportion of funding to the high tech sector increased.

Out of EUR124 million that was invested by Irish Venture Capital Association (IVCA) members up to 31 December 2001, 77 percent, or EUR95.3 million went to high tech firms, according to the third annual report of the IVCA, which was produced by law firm Matheson Ormsby Prentice.

However, as expected overall Irish venture capital investment in 2001 fell to EUR124 million from EUR208 million in 2000. Andrew Doyle of Matheson Ormsby Prentice said the fact that overall investment fell by no more than 40 percent was remarkable, given the dramatic decline in capital markets in the period.

The category receiving the highest level of investment in 2001 was computer software, accounting for EUR68.6 or 55 percent of the total capital invested. However, the actual amount invested in this sector has decreased from EUR112.4 to EUR68.6, in line with the overall decrease in investment in 2001. Computer hardware received the second highest level of investment on 2001, at EUR15.75 million.

Conor O'Connor, chairman of the IVCA, said that the high proportion of investment in technology companies reflected the high number of existing companies in venture capital firm portfolios receiving new funding in the past year. "This is significant as technology and the creation of economic return from it will remain a key driver for the economies of most countries, especially Ireland," said O'Connor.

The report also revealed that 36 percent of capital investment went into start up companies which, when lined up against the overall findings, showed that there are many good Irish high tech projects worthy of seed funding, noted O'Connor. "This one third compares with a European average of a mere 15 percent. This commitment to early stage projects should ensure that Ireland continues to develop a strong and competitive indigenous technology sector into the future," he said.

O'Connor said 2002 remains a harsh operating environment and the outlook for the year is unlikely to be any better than 2001.

The IVCA report broadly concurs with a recent report by PricewaterhouseCoopers, which showed that investment in the Irish technology companies fell by 31 percent last year to EUR126 million. The "Money for Growth 2001" report said technology investments accounted for 80 percent of total Irish investments, compared with a European average of 37 percent.

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