Richard Bruton (Dublin North Central, Fine Gael) | Oireachtas source

The establishment of the development capital scheme is an innovative initiative under the Action Plan for Jobs and has the objective of increasing the availability of risk capital and closing the ‘equity gap’ experienced by SMEs seeking risk capital in the region of €2 million to €12 million. That has been identified by Enterprise Ireland as an obstacle to Irish companies growing to scale, which is a central aim of enterprise policy.

A total of €75 million in funding has been made available through my Department for the development capital scheme with the aim of leveraging a minimum total of €150 million in additional funding from the private sector. Enterprise Ireland has arranged competitive calls for partners in three separate funds. The funding partners are selected based on sectoral expertise, track record and supporting networks which they bring to the funds. Under the scheme, commitments were made to the three funds that will provide equity, quasi equity or debt of between €2 million and €12 million to established investee companies. On 4 November 2013 I announced the establishment of the first of those funds of €125 million which will be managed by MML Growth Capital Partners Ireland. The leverage of private sector moneys at €100 million is very encouraging. A further two funds will be announced in the near term.

Each of the funds established under the development capital scheme is aimed at providing funding for the mid-sized, mostly export-oriented businesses with clear growth and development prospects. The MML fund is a general fund which has no particular sectoral focus. It will target investment opportunities in a wide variety of growth-orientated sectors including manufacturing, technology, engineering, food, life sciences, services and electronics. Enterprise Ireland invests in these funds on the same terms as the private sector. The investment managers are responsible for making investment decisions within a clearly defined investment strategy over the lifetime of the fund.

I look forward to seeing investment in Irish companies in the near term. I am confident the State’s investment in the development capital scheme will be fully utilised, given Enterprise Ireland’s engagement with the seed and venture capital sector which goes back almost two decades and has been very successful in assisting the growth of high potential start-ups, HPSUs, attracting leveraged funds, bringing top level managers to Ireland and attracting interesting first-time international money to the Irish SME market.

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