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KIRSTY STYLES UNCOVERS EUROPE’S BEST KEPT SECRETS

DUBLIN

#STARTUPIRELAND

special REPORT
DUBLIN

Kirsty Styles,
senior reporter, Tech City News
@kirstystyles1

aving just become the
first country in the world
to put gay marriage to a
successful public vote, it’s
clear Ireland is growing up.
The proud Celts, whose road signs
and first names give a hat tilt to a
long history, boast one of the oldest
surviving global cultures. But the
Republic of Ireland as a nation has
still not reached its 100th birthday.
And the past three decades have
been real rollercoaster years for this
young democracy.
While Ireland’s become the
go-to EU destination for tech
multinationals, including Intel, IBM
and Google, along with banks and
big name consultancy firms, the
‘Celtic Tiger’ suffered a near-fatal
blow during the 2008 global financial
crash.

H

THE CRASH
Property speculation spiralled and
created a bubble, with Irish bank
debts finally amounting to some
300% of the country’s GDP, which
was followed by economic depression,
unemployment pushing 14% and
European and IMF bailouts.
The party, centred in the
International Financial Services
Centre on the North Wall on Dublin’s
River Liffey, or the “biggest tax dodge
in Europe”, so called by one of the
city’s vibrant startup community
members, had come to a painful

hangover of an end.
It’s testament to the community
spirit of the locals that some 80
million people worldwide, the Irish
diaspora, still state some connection
to a country their family may have left
generations before. Many descendants
of Irish immigrants have gone on
to lead some of America’s most
successful companies.
And so like a battered creature
rising from the ashes, the great
and good at home and abroad were
convened in 2008 for the inaugural
Global Irish Economic Forum for a bit
of soul searching: what went wrong
and what should Ireland do next?
Now working under the
government’s annually-reviewed
Action Plan for Jobs, the whole
country seems to be buzzing with
energy, initiatives and a collaborative
can-do attitude in order to build
local companies, create 100,000 jobs
by 2016 and regain its global trade
status. Public body Enterprise Ireland,
an equivalent to UKTI founded back
in 2003, is leading much of the work,
a lot of which is being done via public
and private sector collaboration.
In what might be a global first,
Dublin appointed an independent
commissioner for startups last year, a
role outlined in the #bestplacetostart
report, which was published by
the Dublin Chamber of Commerce
and Dublin City Council under the
Activating Dublin banner in 2013.

The city’s first startup commissioner
is serial entrepreneur Niamh
Bushnell, who had been out in New
York since 1998 starting businesses
and mentoring others, having set up
her first company in Dublin two years
earlier.
With 16 years building the startup
scene Stateside under her belt,
Bushnell’s new role, which is funded
by the DCU Ryan Academy for
Entrepreneurship, is to celebrate the
startups that already exist in Dublin,
promote the “world-class” startup
ecosystem and demonstrate the key
role that tech multinationals are
increasingly playing too. “With the
combination of these three things
together, I knew this was the right
time for Dublin,” she says.

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GROWING UP
Google, which founded its Irish
subsidiary in 2003, has just bought a
piece of the nation’s history with its
purchase of the Boland’s Mill, situated
at the opposite end of Barrow Street to
its existing Gasworks offices at Silicon
Docks. Any taxi driver worth their
salt will be quick to tell you tales of
this building’s role in the beginnings
of the new Irish republic when it was
reputed to be the headquarters of the
3rd Battalion of Irish Volunteers led
by Eamon de Valera during the 1916
rising.
Nearly a century later and this place
is yet again playing host to scenes that
SUMMER 2015 • techcitynews.com

“They’re in Dublin
for the talent, the
ecosystem, the can-do
attitude, the fact that
we’re English-speaking
and our connections
with the States”

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special REPORT
DUBLIN

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may change the country’s history.
“There’s been three waves of tech
investment coming into Ireland, from
mainframe companies, to PC and now
internet,” says Paddy Flynn, head of
Google Ireland’s startup programme,
with the latest wave welcoming
new tech brands including Airbnb,
Zendesk and New Relic.
Ireland is not without its own
success stories, which include billiondollar Apple supply chain firm PCH
International, but this high level of
Foreign Direct Investment was just
one aspect of the country’s risky
strategy pre-crash and with such big
names above the door, it can feel like
a large part of Ireland, and Dublin’s
story. Bushnell is keen to emphasise
that within a two-mile radius across
the city, there are also some 2,000
startup companies.
Ireland’s very favourable
corporation tax rate of 12.5%,
likewise, has played at least some
role in bringing the world’s largest
companies to Dublin’s docks, and
can also shoulder some of the blame
for the country’s bad state during the
financial crisis. But the closing of the
infamous ‘Double Irish’ tax loophole
in January may yet again be a sign
that the Irish economy is growing up.
“When you talk to the companies
and people who’ve been here for a
long time, they know they could leave
and get a good tax rate anywhere,”
Bushnell says. “They’re here in Dublin
for the talent, the ecosystem, the
can-do attitude, the fact that we’re
English-speaking and our connections
with the States.”
“Now the government, startups,
multinationals and VCs are finally
working together with a community
objective,” Flynn explains. Google’s
Adopt a Startup programme, for
example, sees local firms receive 90
days’ mentoring from the digital giant,
while the company also runs events
and supports a whole host of learning
initiatives across the country.
Flynn is also leading the charge on
ensuring his employees, who are 70%

foreign nationals, engage with the
local startup ecosystem. “We’ve always
had people leaving Google to found
or join startups and this is all part of
Google’s chance to integrate with the
wider community,” he says.
But with a total population of just
over 4.5 million people, Irish startups
are facing an issue around scaling
that even help from Google might
not easily solve. “In Ireland, you have
to think global very quickly,” Flynn
says. “Consumer technology is more
difficult to scale here, without having
the necessary numbers of users, so
companies typically migrate to the
US, where the population is more
homogeneous and the business model
is better known.”
STEPPING STONE
Founders of customisable 3D printing
startup Love & Robots, sisters
Aoibheann, Emer and er… Kate O’Daly
are already looking outside their home
country for success. Part of Google’s
startup programme, they are targeting
the UK and US with their “full stack
ecommerce, design, making, selling
and shipping” platform. Ireland is too
small,” Aoibheann says.
Likewise, Jayne Ronayn, who came
out of University College Cork and
founded KonnectAgain, a startup that
uses LinkedIn APIs to help people
and companies build better alumni
networks, says she’s already examining
options in the Valley. “Ireland is no
comparison to the States, everything
happens much faster there and the
investment community is much better.
People are open to investment at an
earlier stage, rather than needing lots
of customers or revenue.”
Paul Hayes, CEO at Beachhut PR
and big personality of the startup
scene in Dublin, believes it’s much
easier to raise €100,000 in Ireland
than it is in the UK. “But if you need
more than €100,000, London is far
superior.”
He also says Ireland’s tax offers for
startup investors don’t match up to the
EIS and SEIS relief schemes offered in

the UK. And Bushnell agrees. “I would
love to see something similar to offer
to investors sitting on the sidelines,”
she says. “There’s no shortage of
people with money who would
invest in great startups coming out
of Ireland. There are many different
people in the community pushing this
and I’m confident it’s going to move.”
But, that said, on top of R&D
innovation vouchers and government
match funding for small businesses,
policymakers have just unveiled a
new €10m fund to support startups,
focused on local regions, along
with a tax refund programme for
entrepreneurs investing in their own
company.
In the decade from 2003, the
average number of companies raising
venture capital each year grew from 50
to 150, according to the Irish Venture
Capitalist Association. They also
saw funds raised by SMEs increase
from €200m in the first five years,
to an average €275m annually in the
second. For 2013 to 2018 the IVCA
estimates that the capital required to
fund SMEs is €1.5bn but says “private
sources of capital are in short supply”.
Enterprise Ireland is still the largest
VC investor in the country, with many
in the startup community identifying
a maturing, but not-quite adequate
private investment market. Having
been the CEO of the government’s
Digital Hub innovation space in
Dublin, Edel Flyn, who’s now leading
private co-working space Gravity, one
of a growing number of collaborative
offices, is keen for the private sector
to take the lead. “This is where it
needs to flip - the success of the US in
growing and scaling startups is that
they have the freedom to innovate.”

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LEADING THE WORLD
One innovative answer to this may
well be found with the Lucey Fund, a
funding startup headed by homegrown
investor Ian Lucey. An inverse of the
so-called ‘clone factory’ model, “where
they take 90% of your company and
the CEO is gone in 18 months” Lucey
SUMMER 2015 • techcitynews.com

special REPORT
DUBLIN

supports would-be entrepreneurs
with the technical team to build their
product, taking around 10% of the
company in exchange.
Ian Lucey explains the work he is
doing with a radiographer to create
a “WhatsApp for hospitals. Doctors
have started using text messages
to get x-rays over to other teams in
seconds rather than days. But, for
obvious reasons, they’ve been told to
stop texting,” he says.
ACCELERATORS
Like the Lucey Fund, HealthXL is
turning the accelerator model on its
head to help healthcare providers
innovate in a typically “stale” industry.
“It’s not a problem with funding,”
explains Vesselina Tasheva, who
also founded Silicon Drinkabout in
Ireland. “Accelerators don’t work in
healthcare.”
Having spun out of IBM in 2012
with a view to creating a traditional
accelerator programme for health
innovation, the company pivoted
last year and now matches big
companies with startups who can
solve their problem, whether that’s
with clinical trials or heart care. “It
can take upwards of seven years for
a big health company to do a deal or
collaborate with a startup - we can
take than down to seven months.”
Tasheva moved over to Ireland from

Bulgaria and calls Dublin the perfect
location. “You’ve got easy access to
anywhere in the EU and it’s only five
hours to Boston.” She also campaigned
hard with YesEquality to see a yes vote
in the marriage equality referendum.
“Dublin is leading the world on this no one has ever done this before.”
Dublin’s Web Summit has grown up
in this increasingly confident climate,
seeing the number of attendees
increase from 400 in 2010 to more
than 22,000 heading there last year
from 100 countries. Back for its fifth
outing, Web Summit will welcome
800 speakers from big brands like
Facebook, to new kids on the block
Slack and Stripe, plus more left-field
companies like GitHub.
But far from operating in a bubble,
key actors across Ireland are now
keen to ensure the wealth created
by a tech boom is shared across the
country. The Startup Gathering will
be hosted across five days, five cities
and five industries this year, bringing
entrepreneurial events to Ireland’s
second city, Cork, home of Apple in
Europe and Dr Dre’s Beats headphone
business, along with Galway, Limerick
and Waterford. With 15,000 visitors,
organiser Marika MacCarvill says
she expects this to be the “largest
distributed startup event in the world”.
“Dublin has recovered very well
- but we need to ensure the whole

country recovers,” she says. “We want
Ireland to be the best place in the
world for startups – both homegrown
and international – and our goal is to
make Ireland the global startup hub
by 2020.”
OFFICE SPACE
As ever, with startup success comes
property price issues. Private rents
don’t yet match London, but then
again, neither do salaries in Dublin.
And commercial rents are soaring,
giving rise to a growing number of
co-working spaces for startups to set
up home.
“We’re definitely trying to do
something about this before it
becomes a real issue,” Bushnell
explains. That’s why her office has
joined with Patrick Walsh, CEO of
Dogpatch co-working, and Edel Flynn
from the new Gravity workspace
to create the Dublin Startup Space
Initiative to tackle this issue.
“Our startups are just as strong
as London, our multinationals are
stronger, our ecosystem has the same
infrastructure but there’s much better
organisation in London,” Bushnell
says.
She concludes: “We’ve been less
organised in that big way – but we
want to be, could be and should be.
It’s great that the attitude here is: let’s
just get on with it.” 

ISSUE 6 • techcitynews.com

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