The ubiquity of artificial intelligence (AI) means that to stand out in 2026, Irish start-ups might be best suited to focusing on the fundamentals.
The start-up scene in Ireland is entering an interesting year, to put it mildly. The National Digital Research Centre (NDRC) will be wound down by the end of it, with the Government indicating a replacement will be announced to take over in 2027.
Meanwhile, hubs across the State are finding that AI has become the norm for new businesses. So, too, has a recognition that international expansion needs to be a focus from the off.
“Almost every start-up has some sort of an AI story now,” says Menno Axt, principal at Dogpatch Labs, “which means simply being an AI company isn’t a differentiator. Founders need to stand out through distribution, workflow ownership, data advantages or deep domain expertise.
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“There are more start-ups than ever solving the same types of problems. That means the competition for customers and talent is more intense. You need to be really clear in order to stand out.”
Businesses don’t just need to stand out, they need to make themselves difficult to replace for clients. “The biggest potential is for start-ups that embed directly into customer workflows. What we’re seeing right now is that the best AI start-ups don’t try to reinvent behaviour, they integrate into what people already do on a day-to-day basis. That’s how you create real stickiness,” Axt says.
“Look at Solidroad [the quality assurance and training platform for customer experience teams, both human and AI-driven], which went through Y Combinator and NDRC. They slot into the existing processes of companies and that has helped them land big customers like Ryanair, Crypto.com and H&M.”
In that vein, Axt says the more integral a start-up becomes to a client’s day-to-day operations, the more likely it is to secure its future.
“Some of the strongest companies we’re seeing coming through are becoming the operating systems for customers’ businesses. They don’t just sit on top of the workflows, they are the workflows,” he says.
“Look at Nory [the AI-driven restaurant management software business] or Barespace [a platform for the beauty salon and hair/barber industry], both of which have gone super deep on their categories and created a lot of defensibility as a result of that.”
That growth will probably be best stabilised by growing into international markets quickly, developing ties that can aid a business in scaling and developing.
“We’re becoming more connected internationally. The shift will go from growth at all costs to sustainable, revenue driven businesses. This will play to Ireland’s strengths in turning the deep expertise here into commercially viable products for international markets,” says Niamh Collins, centre director at the Guinness Enterprise Centre (GEC).
“A lot of the companies we see coming into the GEC community in recent months are focused on AI-enabled software.
“In addition, climate and sustainability tech companies will have a lot of opportunities due to businesses facing pressure to reduce emissions across energy, construction, and the supply chain.”
While there’s no shortage of opportunity for savvy start-ups, having the resources in place to take advantage remains an issue. Scale Ireland’s annual state of start-ups survey has listed access to funding as the top concern among founders for the last four years straight. The next edition is due in the coming weeks and it would be a surprise if it doesn’t come out on top for a fifth consecutive year.
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Martina Fitzgerald, chief executive of Scale Ireland, says that ensuring access to funding is vital to keeping the best start-ups close to home.
“Our main concern in terms of securing funding is that we want to keep our founders here in Ireland. We’ve seen from the Draghi report that the proportion of founders leaving Europe is significant,” she says.
Despite it being a tough year for funding, there was an uptick in investment in the third quarter of 2025 according to the Irish Venture Capital Association (IVCA).
“It’s a European problem and an Irish problem. We welcomed the more positive figures from the IVCA in their third quarter report but there are still gaps,” says Fitzgerald. “We need solutions and our companies need solutions. They need money in order to grow from their bases in Ireland to expand into new markets.”
Collins shares Fitzgerald’s concerns about the need to focus on funding and advises start-ups to come to the table ready to tell a clear story to investors.
“Everything comes back to funding and finance. It’s an issue for start-ups and scaling companies across all sectors. Founders will need to operate in a tougher environment in 2026. Investors are more cautious and focused on businesses that can show how they make money,” she says.
“There is funding available but founders need to prove traction, manage their costs carefully and show strong leadership earlier than they have done in the past.”
There are many supports out there for businesses but Collins believes there needs to be a focus further into the life cycle of start-ups.
“The focus needs to shift from starting companies to growing them. Ireland has strong supports for early-stage companies but there’s still a gap when it comes to reaching the point where they need larger rounds of capital, experienced leadership and access to international customers,” Collins says.
There’s also the matter of ensuring the supports that are available are suitable to the companies seeking them out.
“Many of the tools the Government has made available are hard to use in actual practice. They take time and cost money to administer, they don’t often match the pace of what early-stage teams are looking at,” says Axt.
“Streamlining a lot of these processes would remove a lot of friction which would allow founders to build and scale faster. That’s important if Ireland wants to stay globally competitive.”
This is an area Enterprise Ireland is working on to help start-ups, according to Conor O’Donovan, department manager for start-ups at Enterprise Ireland.
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“It’s still an economically volatile environment out there. The funding landscape was challenging in 2025 and that is a challenge for founders. One of the key issues is ensuring founders can access the right support,”
“What a lot of founders say to us is that they want to make sure they find the right support; they don’t want to waste time on the wrong programme.”
O’Donovan says companies that research what is available to them and seek advice can become well-positioned to thrive. “Find out what is there from the Sate to support you. There are a lot of supports, like the pre-seed start fund which provides €100,000 in funding to get the start-up project going.”
Like Collins, O’Donovan advises that start-ups think about scaling overseas from the very beginning of their business journey.
“Think internationally. We are seeing an increasing number of companies that raise funding in Ireland looking to scale internationally. It’s important to have that international focus from the outset.”
To do that, a company will need adequate talent. Axt says start-ups should recognise that the best available people won’t be swayed merely by what they get paid.
“Hiring is only getting more difficult. Founders need to have a strong pitch and compelling narrative about why someone needs to join their company. The salary and equity offer alone isn’t enough any more.”
It’s a daunting scenario, with tight funding and challenges in accessing talent, but Collins says focusing on the fundamentals will help any start-up in 2026.
“You have to keep a really strong focus on your customer or end user. Know who is going to pay for your product or service. Innovate to make sure that it’s a solution that’s needed,” she says.
“Build out a network, get contacts and find mentors who have been on the journey. Advice from people who have been there and done that is always great.”
