Sean Blanchfield writes about Startup Capital in Ireland:
I believe that online technology companies are the way forward for Ireland. It is now clear that online technology companies can be as financially successful as more traditional businesses. However, unlike other sectors, it takes very little money to start an online tech company. Neither does your geography limit your market. All you technically need are brains, and enough money to pay other brainy people to work for you. No need for factories, or 20 years of lab research, or anything like that.
Unfortunately, there are problems providing capital in the relatively small amounts these companies need to initially launch themselves (say €20K to €200,000). There aren’t enough sufficiently cashed-out former technology entrepreneurs to fund at this level as angels. Instead, we rely on small investment firms doling out government money, and a couple of loose angel networks that can make small aggregate investments. At this scale, it’s not viable for investors to have excellent in-house domain expertise to help understand and vet opportunities. Because of this, the dynamics are not what you might expect. You may encounter:
- Folks on the investment side getting confused and thinking they are on Dragon’s Den
- Rife suspicion that entrepreneurs exist to con money out of investors so they can run away with it to paradise island
He goes into a lot more detail so it’s a recommended read.