A key objective of Enterprise Ireland’s strategy for 2022-2024, Leading in a Changing World, is to provide a support structure for early-stage companies and entrepreneurs to meet their business development needs. An important element of that structure is the Pre-Seed Start Fund (PSSF) which aims to accelerate the growth of early-stage start-up companies that have the capacity and ambition to succeed in global markets.
According to Anna-Marie Turley, department manager, entrepreneurship and High Potential Start-Up (HPSU) operations with Enterprise Ireland, the PSSF is designed to assist early stage entrepreneurs to make their businesses investor-ready by providing funding to cover various costs including the development of a market-ready product or solution, product testing in the marketplace, and building critical skill sets within the start-up team. “The aim is to support these enterprises to reach the key technical and commercial milestones required to attract seed investment within 6-18 months,” she says.
Many of the enterprises supported will have already come through the Enterprise Ireland Commercialisation Fund. “Typically, when people come out of the Commercialisation Fund they need breathing space to get ready for seed funding,” Turley explains. “They may not even have formed a company yet.”
This period is what many entrepreneurs describe as the valley of death: the point where their idea is not yet at a stage where it can attract investors. “They will have identified a market but won’t have any traction yet. They are not generating revenue, so it is very hard for them to get funding in the market. The PSSF is a great tool and a great help on the journey. It is an ideal bridge to get them to the point where they are investor-ready.”
The fund is particularly suited to deep tech start-ups which generally take longer to get to the investor-ready stage. “We launched the PSSF towards the end of 2022, and of the 46 companies approved for funding that year, eight of them were deep tech,” she notes.
“Thankfully, Ireland has a lot of deep tech enterprises coming out of third-level institutions and research centres. Many of them are university spin-outs. They are really, really important. They have the potential to improve the economy, society and the world. Enterprise Ireland supports and funds these enterprises and the research institutes. In terms of companies coming out, a lot of them are doing really well, having come through Enterprise Ireland’s Commercialisation Fund and received follow-on support through the High Potential Start-Up programme.”
One of those is Move Ahead, the world’s first motion tracking and movement analytics software built specifically for children. It runs on any device with a camera and connects physical play with innovative digital experiences for children and families.
“The company was selected as part of a programme to work with the IRFU in a programme which allows Irish innovators and start-ups in the sport tech sector to get access to the organisation at an early stage of their product or services development. It enables them to test and validate their products with the organisation.”
Another recent success story is Positive Carbon, which helps customers in the food service sector to reduce their food waste across all their sites with a solution designed to monitor and register all food waste. “The company started on its journey through the New Frontiers programme and was supported by the Competitive Start Fund as well.”
Also in the deep tech sector is Akara Robotics. “This TCD spinout makes robots for the disinfection of hospitals. ResHub is an award-winning, easy-to-use resident experience platform that connects and enables residents, families, staff and service providers to create a personalised experience for every resident in care homes. Teleatherapy enables people suffering from Parkinson’s disease to do speech therapy from home. The solution is now FDA approved and you can imagine how long it takes to get that. These are all examples of deep tech start-ups, and we need to see more of them. We also need to focus on areas like AI and quantum computing. What we can achieve there is almost limitless if we get stuck in now.”
The PSSF offers funding of up to €100,000 in the form of a convertible loan note. “It gives the kick start that a lot of them need,” says Turley. “It is not a grant. It is repayable or can be converted into shares in the company at a later date. If the company does get traction in the market, we can invest again in the seed round through the HPSU programme. That’s another support they can avail of. That’s the great thing about Enterprise Ireland – we work with companies throughout their entire life cycle.”