Lean and R&D Important Enterprise Ireland Supports for Chanelle

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“We have availed of various Enterprise Ireland supports including overseas advice, R&D grants and Lean supports. We are very focused on efficiency, and the Lean supports have been invaluable in this regard.

Enterprise Ireland’s emphasis on Lean practices helped us to take things a step further and go for Shingo accreditation, the programme for which we started in 2016.”

When it comes to Enterprise Ireland supports, Chanelle Group has availed of many initiatives which have made a difference to the Galway manufacturing company.
Tom Kelly, divisional manager for life sciences and the team at Enterprise Ireland have been a great support to Chanelle Group over the years, according to founder and managing director Michael Burke.

Having started the generic veterinary and human pharmaceuticals company in 1985, Burke was focused on exports from the very early days. Enterprise Ireland was always by the company’s side as it made strategic shifts along the way such as in 1996 when it became more focused on Europe.

Awarded by the Shingo Institute at the Jon M Huntsman School of Business at Utah State University, the Shingo prize goes to organisations that demonstrate a culture where principles of operational excellence are deeply embedded into the thinking and behaviour of all leaders, managers and employees.

Chanelle is also in the process of completing a 30,000 sq ft expansion of its 300,000 sq ft facility in Loughrea as part of a €70m investment programme supported by Enterprise Ireland. This will double production capacity at the site and lead to the creation of 175 new jobs over the next five years.

Tips for EU success from Chanelle

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Around 83% of generic pharmaceutical manufacturer Chanelle’s business is now in the EU, but it hasn’t been an easy road. In the early days, it had to overcome significant challenges in terms of getting products registered in different markets. Here, managing director Michael Burke provides his gems of wisdom for companies keen to make it in the EU:

The number one lesson I have learned in relation to exporting into the EU is never to give up. You have to keep trying and submitting the dossiers – no matter what business you’re in. Perseverance and persistence have been a huge help to us as a company.

The key to our success in the EU has been having a clear strategy. You need to know what you’re about and what your goals are. I am a great believer in keeping things simple. We have a simple way of operating and it gets us places. In the past five years we have doubled turnover and it has all been organic growth. The foundations are in place to achieve this again in the coming five years.

Investment in innovation, both on the product development side and in operations, is vital. We now have 70 people working in R&D in the veterinary and human pharmaceuticals businesses. This is a high-cost centre but if you don’t invest in R&D as a company like ours you won’t have any success. Sales depend on continued innovation. On the process side, we have put huge resources and effort into introducing Lean practices to drive efficiency. We are currently working on achieving Shingo accreditation to highlight our operational excellence.

€1.5 billion in cost savings show that Lean thinking works for Irish exporters

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Working from an island, as exporters must in Ireland, forces our businesses to be more competitive than those in the markets we sell to. The products and services that exporters develop here must offer customers more value than those of competitors. Irish exporters can’t just be good, they must be better. Recently, a milestone in achieving that ambition was realised.

More than 1,000 companies have now used Enterprise Ireland Lean Business supports to take practical steps to become more competitive and improve as exporters. While the outcome of the Brexit result increased urgency, competitiveness is not a new challenge for Irish business. Enterprise Ireland launched Lean programmes eight years ago, in response to the then financial crisis. Improving competitiveness can be a matter of survival in times of crisis but all companies benefit from learning how to increase profit margins, build skills, reduce waste and increase capacity.

Enterprise Ireland’s Lean Start, Plus and Transform programmes help companies at all levels of familiarity to find improvements, from design to manufacturing and service delivery, down to getting money lodged in the bank, through logistics and supply chain.

The results these first 1,000 companies have reported demonstrate that applying Lean thinking is a practical way to improve competitiveness, quickly. €1.5 billion in cost savings have been recorded. Lean thinking is also good for the domestic economy, with participating companies reporting a 10% increase in employment. Examples of what companies have achieved demonstrate the potential of Lean thinking for Irish exporters:

• Thermo Air, a manufacturer and distributor of air and heating systems, reduced costs by 8% after completing Lean Start, reporting, “The implementation of Lean has been a very positive beginning to a change in the mindset of our traditional manufacturing company. The future success of the business is on the right trajectory.” The application of Lean thinking enabled the company to reduce lead times from six to three weeks, multiplying the number of orders handled.

• NutriScience, a manufacturer and distributor of animal supplements, reports, “This initiative was a real game changer. We went from being a reactive follower to being a proactive driver.” The company achieved €176,000 in savings, at 8.6% of turnover. In addition to a more engaged workforce and a safer work environment, lead time was reduced from an average of eight to a guaranteed three weeks.

• WhatClinic.com, a website that helps patients find clinics and book appointments, used Lean Start to implement a pre-sales process that boosted new business by 15% and increased their renewal rate to over 85%.

These examples show how practical Lean thinking programmes are. High-level thinking has been transformed into useful tactics that help companies improve today. The range of companies applying Lean thinking was clear at an event Enterprise Ireland recently co-hosted with the IDA in Maynooth. Speakers included representatives from the smallest companies to internationally award-winning practitioners. The depth of understanding attendees displayed shows that Lean thinking has been fully absorbed in Ireland. Experts travel to Ireland to learn about initiatives SMEs here are implementing. This December two Irish companies, Phonovation and Topflight, will host visitors from the EU-Japan Centre for Industrial Co-operation as part of a Lean in Europe series of best practice visits.

Reaching 1,000 projects is a high level of adoption but Enterprise Ireland aims to see that figure quadrupled. The take-up rate of Lean Start, Plus and Transform is rising as companies that see initial results progress further and companies yet to start feel the urgency of not being left behind. Other Irish agencies are keen to replicate the success Enterprise Ireland-backed companies have achieved. The IDA and Local Enterprise Offices implemented programmes that show how Lean thinking can be applied to make major competitiveness improvements for both multinationals and smaller regional companies. Teagasc and Bord Bia are planning similar initiatives.

Companies that are interested in joining a programme should visit the Lean Business Ireland website to find detailed information about supports and get inspired by nearly one hundred case studies that show the savings and sales lean is already helping competitors to achieve.

Rising market for quality goods in the East offers opportunity to Irish exporters

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Irish companies should look east to find a rising marketplace for quality goods and services. Increased middle-class income has transformed dynamics in the Chinese market. Until recently, competing on price was a serious barrier for Irish exporters targeting China. But a shift in consumer preferences has expanded opportunities for overseas businesses. With the reviews and comments section of e-commerce websites increasingly influencing purchasing decisions, price is no longer the c onsumer’s main priority. Product quality has become almost as important. This shift in consumer behaviour has created opportunities for Irish exporters to invest in e-commerce and serve a growing taste for quality goods. Irish companies and brands already have the advantage of being perceived by Chinese consumers as supplying premium products and services, associated with a high level of quality.

One such exporter, Felim Meade, MD of Emerald Green Baby, describes the commercial landscape that attracted his company to the region,

“Everyone knows the Chinese market has huge potential. With the government’s five-year plan for 6.5% annual growth and its ‘Belt and Road’ initiative driving connectivity between Eurasian countries, the opportunities for growth are endless.”

“The challenge lies in accessing China’s potential in a cost-effective way. Emerald Green Baby has been selling in China for three years but spent years researching how to sell there. China is a very sophisticated and dynamic market, far more advanced than what we are used to in Europe and America. The potential for e-commerce is clear when you see that 51% of goods are bought online and 80% of online sales are done on a mobile phone in China.”

China has now overtaken the US to become the world’s number one online shopping market, accounting for over 40% of global e-commerce retail sales. Two of China’s biggest e-commerce players played a major part in that growth. In 2016, Alibaba and Tencent delivered record-breaking profits, signalling how healthy China’s consumer market is. Alibaba’s profit almost doubled to $2.1 billion and Tencent’s grew 70% to $2.7 billion.

The cross-border e-commerce market is expected to reach a 7.5 trillion RMB volume (€1 trillion approx.)  in 2017 (Source: Walk the Chat), demonstrating how appealing foreign brands are for local consumers. This year, the Chinese government announced that they plan to establish more cross-border e-commerce pilot zones to support international companies gain access to the Chinese market. While China’s regulatory environment can still pose a challenge to leveraging cross-border opportunities, these pilots are an example of how the situation has relaxed in recent years.

Enterprise Ireland has increased supports to encourage more companies to capitalise on the opportunities presented by the Chinese e-commerce market in 2018. Several Enterprise Ireland client companies, including Emerald Green Baby, Ovelle, Irish Breeze and Clevamama already sell on e-commerce platforms in China. Irish companies considering China are encouraged to conduct diligent market research and visit the region to ensure they understand consumer preferences in their sector before committing to a plan. Market research will also help companies to determine which e-commerce platform best suits their offering. While some local platforms are not well known outside China, that doesn’t make them any less important within the market itself. Enterprise Ireland’s Market Research Centre is ready to assist companies considering e-commerce expansion to China.

When visiting the region, Irish companies should also aim to meet potential partners and distributors to get a practical sense of the market and explore the need for their products or services. Relationship building is essential to doing business in China and often must be done face-to-face. Many businesses credit their interpersonal relationships as key to successful business in China. In some markets, personal connections can still outweigh other commercial considerations. Contact Enterprise Ireland in China for expert help with building those connections and growing your business in the region.

This article was originally published in the Sunday Independent

It’s No Joko – Huge Opportunities Lie in Wait for Irish Firms in Indonesia

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Indonesian President Joko Widodo’s recent European visit to push for deeper economic ties with the EU has enhanced opportunities for Irish firms in South East Asia.

Trade talks between the EU and the Association of Southeast Asian Nations (ASEAN) collapsed in 2009, and since then the Commission has adopted a strategy of bilateral Free Trade Agreements (FTAs) with member countries.

Already, ASEAN members Vietnam, South Korea and Singapore, have agreed FTAs; and in April, President Widodo – or Jokowi, as he is widely known – met EU leaders, when it was agreed to start talks on a deal for Indonesia.

Jokowi is a reformist who recognises that openness and competition are a pre-requisite for driving one of the largest emerging economies in the world over the past decade. The average annual growth rate there exceeded 5pc over the past 15 years, and modest growth was even recorded during the global crash.

The raw statistics show Indonesia accounts for almost half the GDP of the 10-nation ASEAN bloc and a quarter of the population. But a word of warning – despite being the fourth most populous country in the world with over 250m people, many are scattered across 17,000 islands, shut off from world markets and the thriving Javanese economy around the capital, Jakarta.

There is though, a burgeoning middle class with ever-increasing disposable income. Boston Consulting estimates 71m people are in the Middle-Class and Affluent Consumer (MAC) category, and that will double by 2020.

So, when Jokowi recognises the need for market-friendly measures and the lowering of regulatory and trade barriers, then Irish exporters’ ears should prick up – especially among those already trading in South East Asia who can leverage their position. The legal and regulatory environment is a challenge. However, while getting a market foothold can be slow going, there is a strong appetite for partnerships within the business community and experienced professionals ready to assist.

A colony of the Netherlands until 1945, Indonesians are familiar with dealing with Europeans.

Irish firms like airplane upholsterer Botany Weaving, engineering design firm PM Group, food ingredients supplier Kerry Group and H&K International kitchen supplies have been doing business there for years.

Historically, Indonesia has imported mainly from China, Japan, the US and its ASEAN neighbours, but there is a growing support network for European firms.

Importing expertise and technology rather than goods and services is a noticeable feature of Indonesian business strategy.

Many Irish third-level institutions are active in this market – the booming aviation sector has substantial training needs and, as domestic manufacturing increases, firms experienced in delivering services for multinationals in Ireland can export this know-how.

But Irish companies need not limit their ambition here. Tech travels and Indonesians, particularly the younger population, are big on connectivity, in every sense, and often carry two phones.

Apps and other mobile-enabled services are major growth sectors. Irish companies experienced in the added-value technology sell have opportunities in sectors such as telecoms, aviation and health. There is also increased demand for foreign brands and produce. This presents an opportunity for Ireland’s food and ingredients companies offering quality products, new flavours and more variety.

In Indonesia, relationships are central to doing business, and a local partner is strongly advised. Choosing the right route to market is crucial and local associates are advised because of their knowledge of the legal environment, the way of doing business and their networks.

Unlike some markets, where it is possible to sell largely on the strength of your offering, serving the Indonesian market remotely from Ireland through email and web conferences will not work, even for the technology sell.

Facetime is a pre-requisite and be prepared for meetings where more time is spent with small talk rather than big numbers. It’s very social. They work on ‘jam karet’, or ‘rubber time’, meaning punctuality or meeting duration is unpredictable and nothing gets done in a hurry.

It’s about building the relationship. Presence on the ground or even in a neighbouring ASEAN market is well received and highlights your long-term commitment.

They’ve got to like you before they trust you. And they’ve got to trust you before they’ll do business with you. To seize the Indonesian opportunity, come early and come often.

Smruti Inamdar is a director of the ASEAN region with Enterprise Ireland and is based in Singapore

This article was originally published in the Sunday Independent

Will the ‘Rising Star’ of Vietnam Keep Shining Above the Rest of Asia?

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The ravages of war, internal strife and regional conflict have formed the greater part of Vietnam’s political history and taken a toll on its people. But 40 years after the last great conflict, the country has rebounded – and it is now seen as the rising star of South-East Asia

In 1986, the government made a decision to move from a centrally planned economy to a decentralised model promoting the private sector as the prime engine of growth.

The policy, known as Doi Moi (which translates as ‘renovation’) has seen the government adopt a pragmatic approach to business; including the divestment of state-owned enterprises, paving the way for more public-private partnerships.

Strong economic fundamentals – GDP growth at 6%, unemployment at 2%; inflation at 4%, along with over €20 billion of Foreign Direct Investment last year and a shift of production bases from other lower-cost countries into Vietnam – have made the country a rising star in ASEAN.

Vietnam is one of the 10 member states in the ASEAN Economic Community (AEC) and a party to several free trade agreements including the EU-Vietnam FTA (EVFTA). The EVFTA creates great opportunity for Irish exporters, particularly in agri-business. It is also party to trade agreements with China, India and South Korea. This has given it much-needed economic integration internationally.

With its population of 95 million (and growing by a million every year), Vietnam is an exciting, rapidly developing nation and one of the most dynamic emerging markets in ASEAN. Consumer retail spending is also on the rise as a growing middle class with increasing disposable incomes shop for higher-priced products and services.

With over 200 malls and counting, retail spending continues to grow. There is a growing demand for iPhones, high-quality infant formula, luxury brands and international schools for children. Approximately 100,000 Vietnamese students study overseas every year.

Connectivity and travel within Asia has become more accessible thanks to low-cost carriers such as Vietjet Air and Jetstar Pacific. These are customers for Irish companies such as Inflight Dublin, Botany Weaving and CAE Parc Aviation, who provide technologies and services such as inflight entertainment, aircraft interiors and crew training.

Irish medtech, health IT, consumer health and pharmaceutical industries have spotted openings and Irish firms like Chanelle Veterinary, Kora Healthcare, Escher Group, Brandtone and Glandore are already active here. Enterprise Ireland regularly conducts trade missions and events which continue to create further opportunity for Irish businesses.

Doing Business in Vietnam

Business in Vietnam is all about building relationships and connections. In order to do business, you must be willing to visit regularly or have someone on the ground to represent the company. It requires long-term relationships and getting people to commit and trust you before contracts can be signed.

Setting up a firm is relatively simple and takes about a month. The regulations are quite accommodating to foreign companies with several options for structuring entry into the market. Work through a lawyer or a business advisor, as the paperwork can be cumbersome and documentation needs to be translated into Vietnamese.

Growing affluence has also enabled tech uptake – half of the population is using the internet today. Vietnam has great potential in adopting digital technology but progress has been slow because of a lack of digital readiness, providing opportunities for foreign companies that can deliver solutions.

Economic reforms in Vietnam are still a work in progress but the government is intent on being internationally competitive. The economy is expected to sustain growth, driven by robust private consumption and investment growth.

Ireland’s Polish Community Helps Make Poland a Great SME Target

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It may be a bold claim, but Ireland’s trade relationship with Poland is unique among non-English-speaking countries.

While other EU markets may be richer and more populous, strong personal and professional ties between the two countries makes Poland easily accessible to Irish businesses.

People generate contacts and Ireland has few rivals with Poland in terms of people connectivity. Approximately 3% of the Irish population is Polish, spread across the country. Irish companies have seized the opportunity this offers, using their Polish staff to access this market, represent them and set up offices. For example, of the 42 companies participating in Enterprise Ireland’s 2015 Trade Mission to Poland, over 50% were represented by Polish staff.

The Polish economy has come a long way in the past decade. It did not suffer as badly as other countries during the recession, with continuous GDP growth due to large EU transfers and Poland’s growing attraction for foreign direct investment (FDI) and manufacturing migration.

EU funds have built out the transport infrastructure, meaning companies such as Amazon now effectively service Germany from Poland. Conglomerates such as LG, Samsung, Merloni and Philips have been attracted here too.

The country is also a leading market player for ICT (cloud, ecommerce and enterprise solutions) and business process outsourcing. Over 50 Irish companies have operations in Poland, with many such as CRH, Steripack, Kingspan, Smurfit Kappa and ABP having production facilities.

Many Enterprise Ireland clients export directly into Poland. The fastest growing export sector is the sub-supply of goods and services to multinationals with operations in Poland. This is simply business expansion where Irish companies with existing relationships with FDI in Ireland, extend their export footprint to Poland. But there is opportunity for firms of all sizes.

Other key exports include smart farm goods and services (agricultural technology, veterinary products and animal nutrition), materials handling equipment, pharmaceuticals and medical devices and construction services.

Ecommerce is a particularly easy way to access the Polish market with the sector growing 20% year-on-year and worth nearly €10 billion. And it may also be about to get a bit easier. Allegro, Poland’s equivalent to Ebay or AliBaba, is the dominant player in the online sales market. It engages with small and medium enterprises who want to expand their online offering to Poland, and is ready to provide sales, logistics and payments support to Irish online businesses. Allegro transacts over 150,000 purchases daily with clothing and babyware being the most popular exports from Ireland. Often this is just simple re-selling by individual entrepreneurs – so if they can do it, there is no reason SMEs in sectors like dry food, giftware and clothing could not follow suit.

Conducting business in Poland is, for Irish firms, about as easy as it comes. There are 11 direct-flight destinations, the country ranks ahead of Germany and France for English speakers and Irish and Polish business culture is broadly similar.

However, it is not all good news. Poland is a notoriously price-sensitive market with corporate buyers feeling more comfortable making a decision on the basis of lowest price. This is an issue for Irish companies because we tend to sell on quality and value-added criteria.

As a former member of the Communist bloc, it should also come as no surprise that the country is quite bureaucratic – but this only really affects in-country operations and has little impact on exporters. Remember, Ireland is unusual in our low level of bureaucracy. Nonetheless, compared to other markets, Poland ranks as a particularly strong export opportunity for Irish firms of all sizes.

Australian Dream Up for Grabs for Fintech, ICT and Construction Firms

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Aborigines believe the world was created during the dream time. And from the latter part of the 20th century onwards, the same term could be used for the Australian economy.

When Australia’s dollar was floated in 1983 as part of an economic liberalisation strategy, it led to investments and trading relationships that turned open the spigot on the country’s unrealised wealth. Since then, Australia has confidently ridden economic headwinds to become the 12th largest economy in the world, boasting 24 years of uninterrupted growth averaging 3.3pc. A considerable feat considering its relatively small 23m population.

Australia offers a powerful combination of a highly-skilled workforce, legal and political stability, efficient and transparent regulation, sound legal and governance frameworks and close ties to the fast-growing markets of Asia. It is, and will continue to be, a dynamic and dependable market for Irish exporters. Its high rating in ease of doing business is a key differentiator from its Asian neighbours.

Key sectors in Australia

Many sectors are enjoying growth – including financial services, telecoms, IT for health, enterprise software, HR solutions and consumer products – but the burgeoning fintech sector is particularly noteworthy. Australia is on the verge of becoming the fintech centre of Asia driven by changes in government, the rise of fintech innovation hubs such as Stone & Chalk and an increased national focus on the sector.

While focal points for the fintech industry have popped up around the world, there’s yet to be a major player in Asia, and this is where Australia’s opportunity lies. Irish companies such as CurrencyFair, FEXCO and Fenergo have been seizing this opportunity over the past number of years.

Further opportunity lies in the increased construction and engineering activity to meet the demands of the oil and gas boom in Western Australia and Queensland. Australia will become the largest LNG producer in the world by 2017 following investment of around €179bn over the last seven years.

Combilift, Suretank, Chemstore, and Abcon among others supply the operation and maintenance of these facilities. While the economy has slowed as the mining boom wanes, be assured that end-users will buy, though it means buying cycles are often longer and negotiations harder to secure significant contracts.

Last year, prime minister Malcolm Turnbull pledged AU$1bn (€640m) to promote business-based research, development and innovation. This “innovation agenda” means businesses will have easier access to the €3bn spent by the government on IT each year via a new digital marketplace.

Since 2005, the Commonwealth, States and Territories have also been investing (through the Digital Health Agency) in key building blocks for a national e-health platform. These initiatives are boosting IT investment in the sector and delivering opportunities for Irish enterprises to provide solutions. This March, medical software company Oneview became the first Irish company to list on the Australian Securities Exchange due to their success in the healthcare sector here.

Advice for Exporting to Australia

When evaluating the Australia export opportunity, be aware of the vastness of the country. Larger companies who take on agencies often have an office in each of the major cities, while smaller partners tend to operate only in their local states.

Exporters should also be aware that given the distance from Ireland, many companies feel that by simply appointing a partner they have satisfied their market-entry requirements; however, agents and distributors in Australia often require as much servicing as direct sales teams.

The Irish diaspora is always willing to assist with market knowledge and introductions so help is at hand when choosing the best approach.

Mary Kinnane is Enterprise Ireland director for Australia/New Zealand

This article originally appeared in the Sunday Independent

Mid-Life Dilemma: Time To Sell Out or Stock Up?

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An upswing in market momentum in 2015 pushed IPOs into the spotlight for strong-growth companies. Gordon Smith asks if they are right for every business.

Positive signs from the Irish Stock Exchange during 2015 helped to push IPOs (initial public offerings) back to prominence as a viable option for businesses. Hostelworld floated in Dublin and London raising €245 million while another Enterprise Ireland-supported company, Mainstay Medical, had a successful joint listing on the Paris Euronext and Dublin’s ESM, raising €18 million. Other prominent and well-received listings included Applegreen, Malin Corporation, Permanent TSB and Cairn Homes.

So, will we see a flurry of flotations among Irish companies? For many, the idea of going public remains shrouded in mystique.

In a bid to address this, the Irish Stock Exchange launched its ‘#IPOready’ initiative. A secondary aim of the #IPOready initiative was to nudge Irish businesses away from the traditional exit of a trade sale – a trend that has seen promising companies snapped up early– like the UCD spinout LogEntries, which was acquired by US outfit Rapid7 for $68 million.

“There have been some high-profile trade sales where the owners got an offer and went for it, but I’d love to see more people accessing capital markets to raise that funding,” says Orla O’Gorman, head of equity at the Irish Stock Exchange. “An IPO gives a business permanent strategic capital. It’s not like a loan that will need to be repaid, and it enables you to grow your business.”

Missed Opportunity

“If you’re on your first company and you get the chance to sell out for a personally significant sum, but the company did have the potential to scale and potentially IPO, it is a missed opportunity,” agrees Cronan McNamara, CEO of Crème Global and chair of the Irish Software Association (ISA).

“Some founders don’t go into business to build and sell, but when that offer comes along, they can’t refuse because they have no other way to de-risk their financial structure. They might be heavily taxed on their income, so there’s not a lot of incentive to keep plugging away. And perhaps it’s a more straightforward transaction compared to the reporting burden of going public.”

The ISA supports the IPOready programme, especially as Ireland’s software scene has few active participants who have been through the experience of life in a public company. However, an IPO may not be the only valid option for a growth-minded company. On a personal level, Mr McNamara says the greater availability of private investment is an attractive alternative. “You see Michael Dell taking Dell private because he felt they were undervalued on the market. As a business, you need a lot of structures in place to IPO, and there are a lot of very successful companies, like Mars, Bosch and Deloitte that are all private.”

Enterprise Ireland also supports the #IPOready programme. “We have a variety of funding options so that companies can grow and scale, such as the Seed and Venture Capital schemes, the Development Capital Fund and the Innovation Fund Ireland programme,” explains senior policy adviser Garrett Mooney.

“An IPO is one strategy within that mix, and we believe a certain cohort of Enterprise Ireland-supported companies should look at it.”

The Decision to Float

In weighing up that decision, John Casey, partner in PwC’s deals practice, says companies don’t necessarily need to be at a particular size or scale to consider an IPO. “The requirements for the Enterprise Securities Market in terms of the startup track record are pretty generous. It’s a question of whether investors would be willing to back the management team and back the story. Let’s say you’re a pre-revenue startup: an IPO will be a hard sell to raise money, so you tend to see that people will get funding from other sources until they build critical mass.”
Business owners have to see the value in bringing external equity into play, adds Michael Neary, a corporate finance partner with Grant Thornton. Even to embrace the concept, they’ve got to accept that sharing the pie and owning a smaller share in a bigger business is more worthwhile than owning a larger share in a smaller business.

The decision to go public may be also affected by factors beyond the business itself. A good adviser can help the business make a decision about whether or not to press ahead with a public listing if external conditions are less than favourable. “You can be just at the wrong stage, and there have been public examples of IPOs that have been pulled. Digicel were quite public about not getting the valuations they had hoped for, so they decided to hold it over. There’s no loss of face in pulling out of an IPO at the right stage, if you as a founder say ‘I think my business is worth more than that’,” he says.

Some businesses keep their options open by undergoing a vendor due diligence process that prepares them either for flotation or for a trade sale. Casey says an IPO process requires more detailed preparation in terms of due diligence. An IPO exit shouldn’t be equated with a trade sale for founders, he adds. “With an IPO, investors are backing the management team, which will likely include the founders. This may or may not be the case in a trade sale, depending on the buyer. An IPO is a method of introducing liquidity to the shareholder base and taking some money off the table. But don’t forget, the majority of funds raised in an IPO tends to be for the benefit of the company, to fund expansion, debt-reduction or both.”

 Irrespective of a company’s decision whether or where to float, the rigour of preparing the business will stand it in good stead no matter what funding route it ultimately chooses, says Mooney. “In looking at the IPO journey, you are also preparing yourself for other investment options that may arise. Governance isn’t unique to IPO. We wanted to make sure that even if entrepreneurs come out from the IPO ready programme and decide they don’t want to IPO, they will still have learned from it.”

Linesight gains from Enterprise Ireland’s networking supports

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Enterprise Ireland’s contribution in relation to knowledge-sharing, market information and access to key contacts has been invaluable to Linesight. Having built up a strong domestic presence since 1974, professional services provider to the construction industry Linesight needed to grow its business in overseas markets when the recession hit in 2008.

Linesight director, Paul Butler

The company found a series of workshops on data centres, organised by Enterprise Ireland, particularly valuable – an area which Linesight wanted to focus more on, according to director Paul Butler.

“Enterprise Ireland brought all the leading consultants and contractors together in one location to discuss the pros and cons of doing business with data centres and how to attract further data centre providers to Ireland,” he says. “All the relevant information was shared with everyone involved afterwards.”

Linesight went about sourcing and training people dedicated to providing professional services to data centre projects, which are very mechanical and technically driven. It now has a designated team which looks after a number of data centre clients in Ireland, the UK and the Netherlands.

Once Linesight decided it wanted to explore opportunities in the Netherlands five years ago, it benefited greatly from several introductions to the market, and with local providers organised by Enterprise Ireland in Amsterdam, according to Butler.

“We were very keen to get local information and find out from others who had tried the market before, the lessons they had learned,” he says.

“Enterprise Ireland put us in touch with key contacts and set up face-to-face meetings with other contractors and consultants in the sector. The support in terms of local knowledge and getting to grips with how things are done there has been excellent.”

International collaboration the zeitgeist in Berlin tech scene

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The Berlin landscape today is very different to what it was in 1989, when the wall fell. Back then there were no cranes crowding the skyline, and the now-ubiquitous tech company logos outside offices were almost non-existent.

After reunification, a short boom was followed by a lengthy recession that left the city trying to carve out a new identity in the world. During this time, artists, creative media types and techno music disciples flocked to Berlin, giving it a public image it retains today.

Strolling around back then, the graffiti-covered squats served as an unapologetic symbol of the post-reunification liberal culture. In 2004, Berlin’s flamboyant mayor, Klaus Wowereit, described the city as “poor but sexy”.

In recent years, Berlin’s story has become something of a rags-to-riches tale. Bucking the German demographic trend, its population is increasing – largely due to EU and US immigrants attracted by the informal lifestyle and lower cost of living compared to London, New York and San Francisco. Many are highly educated and have the software development skills craved by tech companies worldwide.

Berlin is now one of Europe’s hotspots for private tech investors

Consequently, Berlin has become one of Europe’s hotspots for private tech investors. According to Dow Jones, €1.97bn in venture capital was raised here, more than most tech locations worldwide. The trend is set to continue. New tech companies are establishing here at a rate of 10 a week.

In contrast to tech in Ireland – with our mix of home-grown start-ups, major US tech companies and closely-connected infrastructure – the Berlin cluster is anchored by a small number of home-grown companies. Soundcloud, 6Wunderkind, Zalando, Onefootball and Rocket Internet are leading names among the 2,500 tech companies here.

Traditional German firms are getting in on the act. Household names with start-up incubators, accelerators or VC arms include: Google (through the Factory), Deutsche Telekom Innovation Laboratories, BASF, Bosch, Daimler, Microsoft and the Deutsche Bahn Mindbox.

Irish Tech meets Berlin Tech

Enterprise Ireland recently hosted ‘Irish Tech meets Berlin Tech’, involving 35 CEOs and senior managers from Ireland taking part in expert panels on tech and finance, fintech and HR technology; as well as buyer meetings and a networking reception at the Irish Embassy. Some 120 executives from the Berlin tech and VC industry took part – a testament to Ireland’s growing reputation here.

Several key learnings arose that should be of strong interest in Ireland. For example, collaboration takes place at an earlier stage here, with Berlin-based companies looking to partner with the right company and grow with them.

Thus, fast-growing start-ups can become multinationals very quickly. For instance, the aforementioned Zalando, founded eight years ago, now employs 10,000 people with international operations, including a strategic development centre in Dublin.

A software firm founder told me he sources from two Irish companies, despite having fewer than 15 employees himself. He regards this as only the start of his international partnerships.

Our seminar also heard that funding is becoming more specialised and more open to cross-border investment. While Ireland has a strong background in seed and early-stage funding, Berlin is strong at later stages.

Opportunities for Irish companies

There are opportunities for Irish companies to take advantage, particularly in strategic investment from the VC arms of large German companies. This can open up ready access to the parent company. VCs in Europe are also more willing to invest abroad without requiring companies relocate nearby – ideal for Irish companies interested in scaling.

Another feature of the tech scene here that will please every entrepreneur is that SMEs generally make decisions faster than larger, traditional companies. One Irish company that took part in our programme last month signed a deal here within 10 days.

Those in the Berlin tech cluster recognise Ireland’s scene is different but complementary to their own. Government body Berlin Partner has launched a “start-up alliance” linking their cluster with others worldwide. The door is wide open here to the well-reputed Irish provided they are prepared to get with the philosophy of Vorsprung durch Kollaboration.

Innovation Islands: Building on Irish Success in Singapore

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Like Ireland, Singapore has experienced dynamic growth and the opportunities and challenges that accompany it in recent years. In both countries, innovation has been used to overcome challenges that include upskilling a workforce and maintaining a world-class infrastructure. A focus on development has helped Ireland and Singapore to become known as ‘innovation Islands’ – hubs for world-class entrepreneurs and ecosystems that support the growth of multinationals.

Irish companies with disruptive, value-adding solutions are carving out business opportunities in Singapore. A trade and investment mission to the APAC region presented opportunities to appreciate the links that Irish-owned SMEs have developed in Singapore first hand. In total, 60 Enterprise Ireland client companies participated in the mission across two market legs – Singapore and Japan – with the goal of securing export business in the wider Asia region.

A tour of Singapore’s tallest building, the Tanjong Pagar Centre, was included on a tight schedule on the second day of the mission, giving delegates a chance to observe the impact of Irish innovation on the city. The energy-efficient technology of Tanjong Pagar Centre towers over Singapore’s Central Business District and is powered by the Dublin-headquartered company Cylon Controls. As the developer Guocoland explained with a smile, “the brains of this building are Irish”.

Opportunities in green tech are a particularly good fit for the capabilities of Irish companies. Singapore is driving an ambitious environmental agenda, with a target of 80% of buildings to be green by 2030 (currently at 33%) and to increase the number of green specialists from 15,000 to 20,000 by 2020. The government is providing a Zero Capital Partnership, enabling building owners to engage Energy Performance Contracting firms for energy retrofits with zero capital outlay.

Ireland’s green build cluster is supported by a sophisticated network of companies specialising in building energy management systems, green building materials, HVAC, lighting and energy technologies, as well as green architecture and engineering. Major names include Zutec and Kingspan Insulated Panels. Enterprise Ireland actively collaborates in this space, working with the Singapore Green Building Council to provide new solutions that help the markets to ‘go green together’.

The aerospace and aviation sector also presents opportunities for Irish companies considering Singapore. Over the next 20 years, Asia-Pacific will have the greatest demand for aircrafts, representing 39% of global requirements. The region’s global share of passenger traffic is also expected to rise from 31% to 42%. Ireland is viewed as a global centre of excellence for aviation, with a proud history of pioneering developments and dynamic innovation. Irish companies including CAE, Eirtech Aviation and Aero Inspection are leading the way, securing aviation opportunities in the wider APAC region from bases in Singapore, for example, in the Aviation Festival Asia in Singapore.

There are good reasons for Irish business to look to the Asia-Pacific region. It has delivered double-digit growth and an impressive year-on-year gain, making it one of the fastest growing regions for Enterprise Ireland clients. Many are already capitalising on that potential, with exports from Irish companies to Singapore and the wider ASEAN region on the rise and growing steadily year-on-year.

The trade mission raised the profile of Ireland as a key supply base offering high-value solutions and created a number of partnership opportunities between Irish and Singaporean companies throughout the ASEAN region. The ASEAN office hubbed in Singapore will expand resources over the coming months to further support Irish clients in their growth as they diversify through the region.

The Emerald Isle and Singapore, ‘the Garden City’, work well together because of what we have in common, a history of economic growth based on a trading perspective, investment in education and training, support for innovation and R&D, and an ability to succeed in the global marketplace. The vibrant export growth of both countries over the past ten years has positioned us both as trading nations, global players, and true innovation islands.