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How does the decoy effect lead us to spend more money? Discover more in this interesting article by Jeff Haden!
Jeff Haden, Inc. 12 January 2021
When I was a wedding photographer (because no one should be just one thing), my wife persuaded me to add an extremely expensive option to our list of wedding packages.
I figured it was a waste of time since no couple would ever choose it.
Turns out – as with countless instances where my wife’s better judgment is concerned – I was wrong. Some couples did choose that package. Even if we didn’t include that package in the calculation, our average sale price went up.
Possibly, because to some, “expensive” is a proxy for “excellent.”
But mostly because of what Dan Ariely, Duke professor and author of books like the excellent Predictably Irrationally, calls the decoy effect.
If you aren’t familiar, here’s how the decoy effect works. Some years ago, the magazine The Economist offered a digital subscription for $59 and a print subscription for $125.
Then they decided to offer a third option: A combined digital and print subscription for $125.
When two options were available, most people chose the digital subscription. It was cheaper.
But when the third option was available, people were more than 50 percent more likely to choose the digital/print offer.
The prices didn’t change. The only thing that changed was the addition of a decoy.
Another use of the decoy effect involves the number of choices offered. If there are two options, more people tend to choose the cheaper. If there are three, more people tend to choose the middle one. Partly that’s due to something called the center stage effect, a natural bias toward whatever is physically in the middle.
And also because people tend to not buy the least expensive, because that feels “cheap,” yet also not the most expensive, since that feels indulgent. Or wasteful. (Or something.)
But add a fourth option, and people tend to go for the second-most expensive, not the third-most expensive, even though both are kind of in the middle.
Which turned out to be true with wedding photography. Significantly more people chose the second-most expensive package out of four, especially when we made the most expensive package really expensive: by comparison, that package seemed like a bargain.
Granted, no amount of pricing strategy can overcome a poor price-to-value proposition.
But if your products or services are competitive and provide genuine value — which ours definitely were, and definitely did, otherwise we wouldn’t have had a business, much less a successful one — then a little tweaking can pay significant revenue dividends.
Especially with men: Research shows that people with higher levels of testosterone (read: males) tend to make less consistent choices and more “target” (decoy effect intended) choices.
(Yet more proof that men really aren’t more rational than women.)
Thinking Beyond Price
The decoy effect can play a role beyond purchasing decisions. Research shows the decoy effect can influence how employees decide between benefit plans. Other research shows the decoy effect can influence health care decisions.
Or say you want to encourage your employees to save for retirement. If you offer them the options of opting out or getting some sort of match if they put aside 5 percent of their pay, some may see 5 percent as too high a bar and opt out.
But if you offer a third option – a lesser match after employees contribute, say, 2 percent of their pay – then more people are likely to opt in.
And more people are likely to go for the 5 percent option, since getting a 5 percent match seems a lot better than 2.
Even though 5 percent is a lot better than 0 percent.
So if you want to be more persuasive – and hopefully use your powers for good – consider how you frame the options you provide. A little tweaking can make one option seem more attractive. A little tweaking can make one option seem less burdensome.
Add a relatively unattractive option and you might just find that what you hope will occur is much more likely to occur.
Behavioral science says so.
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Ireland is one of the best countries in the world for business and indeed Forbes ranks Ireland 11th in their 2018 Best Countries for Business report.
Ireland also continues to lead the world for attracting high-value investment, generating substantial inward investment with strengths in key high-value sectors such as ICT, financial and business services and life sciences, as stated by the IBM Global Location Trends 2018 Annual Report.
Even the UK based merchant account provider Paymentsense recently acknowledged Ireland as one of the best Countries in the world to start a business, ranking Ireland as the third best Country in the world to start a business.
Many successful Ireland-based global corporations of today were only early-stage start ups 5 years ago. If you want to create a start up in Ireland, you are on the right track here!
In our guide we have outlined the key steps you should follow when setting up your business.
We also provide you with curated lists of organisations and resources that can help you make the dream of starting your own business in Ireland come true.
What you will find in our guide on how to setup a startup in Ireland:
- Why set up a startup in Ireland
- Legal structures
- Administrative procedure to create a start up in Ireland
- How long this process takes
- What to do if you come from EU
- What to do if you come from outside of EU
- Costs of a start up in Ireland
- Financial supports for a start up in Ireland
- Tax incentives
- Other supports
- Helpful resources for your start up
Why Set Up A Start Up In Ireland
There are many reasons why Ireland is a perfect place to start and grow your business.
Some of them are:
- the Irish business culture
- a very good fiscal system – the Irish government offers one of the lowest corporation tax rates in Europe at 12.5%
- a simple bureaucratic system
- a great ecosystem of accelerators and incubators providing pre-seed and seed investment, office space and mentoring to early-stage startups (as Shourjya Sanyal highlights on Forbes)
- the multitude of start up grants and start up funding.
Ireland is the only English-speaking country in the eurozone, and it is geographically interesting as it is located between mainland Europe and USA. This would be even more important if you decide to invest in both these regions.
Ireland offers a young and well-educated workforce, and attracts bright talents from across Europe.
Ireland is also known for being the European country with the most global corporations which are leaders in their markets.
Many of the world’s top ICT companies, such as Intel, Facebook, Google, Microsoft, Apple have a considerable presence in Ireland.
And not by chance, many international corporations moved their headquarters to Ireland.
Five of the top 10 companies on Forbes’ list of The World’s Most Innovative Companies have Irish operations.
All of this helps startups find clients among the big corporations, refine business niches to operate in, and grow in a dynamic, innovation-oriented landscape.
The positivity of this ecosystem is reflected by the growing number of startups in Ireland. A recent infographic by TechIreland reveals that in 2019, in Dublin only, there are almost 1200 start ups.
As soon as you have made up your mind about starting a business, you should give very early consideration to the legal form that your business will take.
This is a key step in setting up your business. Changing the existing structure and implementing a new one can be expensive and time consuming, should you decide to change your legal form once your business has been established.
It is much better to have the right structure in place from the outset.
Some of the most popular forms available in Ireland include:
- Sole trader;
- Limited company.
You can choose one of these depending on the type of business you want to manage, its structure and risks.
The type of business structure you opt for will have several implications: the laws governing the operation of your business,you and your business partnerships’ liability, how you are taxed and the business records you have to keep.
Let’s learn a bit more about the most common legal structures in Ireland:
A sole trader refers to a business in which you are the only legally responsible person.
Setting up as a sole trader is an easy process.
All you have to do is register your business name to CRO (Companies Registration Office) and then register as a self-employed person with the Revenue Office.
Before you join the 575,461 businesses already on the Business Names Register check https://t.co/hWPZX3wrmx – Then register your new business name on https://t.co/EEH0tpx2BG @EnterInnov #CRONUMBERS #BUSINESS #COMPANY pic.twitter.com/6j5q8xdcui— CRO Ireland (@cro_ie) September 9, 2019
This type of business seems easy to start, but if it collapsed, you would have to pay any business debts using your personal assets.
A partnership is a business composed by 2 or more legally responsible people together.
Usually, a lawyer has to draw up the agreement between the people that compose the partnership.
In case of bankruptcy, a partnership works like a sole trader: those legally responsible will have to pay with their personal assets.
To set up a limited company, you have to register it at the CRO (Companies Registration Office).
A limited company is the safest model of business among these; in fact, in case of debts or bankruptcy, creditors can only claim on company assets.
The directors’ personal assets are safe, unless they are found guilty of fraudulent or reckless behaviour.
That’s because a limited liability company is a separate legal entity and the company name will have “Limited” at the end.
At this phase, it is recommended to consider the opinion of a lawyer or an accountant.
Administrative Procedure To Set Up A Start Up In Ireland
Before you choose your company name, we’d recommend a legal consultancy on your trademark, which could prevent intellectual property conflicts, and protect your company’s trademark.
Also, make sure you check that the domain’s name you have in mind is free – or at least affordable to buy from somebody else.
If your domain is not available, a whois search will help you find the owner or their representants for a possible contact and buyout.
Once this is done, there are 3 main steps to follow to set up a start up in Ireland:
- company registration
- bank account opening
- tax registration
First of all, you have to choose what type of business you want to start, and register it with the Companies Registration Office.
If the business is being established using the entrepreneur’s true name, you are not required to formally register the business name.
If a business is to be carried out under a name other than the entrepreneur’s true name, registration of the business name is obligatory and can be registered online on the Companies Registration Office website.
If formal registration is required, it is not possible to fully register a company electronically under Irish law, as a statutory declaration cannot be made electronically.
Bank account opening
To start trading with a company, you must have a bank current account.
You can open it by going to the bank in person, or in some cases by using their online platforms.
The banks offer different types of accounts based on your needs and company type.
For example, Bank of Ireland offers to businesses include a Standard Current Account, a Business Current Account and a Startup Current Account. Make sure to compare the offers and pick the ones which suit you better.
Websites like bonkers.ie offer useful comparison tools to check the costs of the different accounts.
You can register your company on the ROS (Revenue Online Services) portal.
The tax you pay will depend on the size and type of your business and other factors, such as the sector you belong to.
This may mean that your tax registration will involve different steps, and depending on the type of legal structure you are registering you may also have to register for different kind of taxes or levies.
There are 4 main taxes for business:
- Corporation Tax (CT). There are two rates of Corporation Tax (12,5%, available to companies that are centrally managed and controlled from Ireland and 25%). This applies to Irish Limited Companies only.
- Value Added Tax (VAT). You need to register for this once you reach the VAT threshold – €37,500 for services and €75,000 for goods.
- Employer Pay As You Earn Tax (PAYE). If your company or business has employees, you will need to register your business as an employer. Once you are registered as an employer, you business is liable to pay PAYE (Pay As You Earn).
- Relevant Contract Tax (RCT). This applies when a principal contractor is paying a sub-contractor to carry out or supply labour in relevant sectors such as construction, forestry, and the meat processing industry.
Are you unsure whether you have to register your company, or how to register your business? Are you confused about which taxes you have to register for? A place to seek help would be your Local Enterprise Office.
How Long This Process Takes
In Ireland, administrative procedures and bureaucracy are usually faster and simpler than the European average, and setting up your startup in Ireland will not take too much time.
Registering your business will take 3-5 working days.
Opening your bank account usually takes a few days.
After this, you have to register for VAT & Corporation taxes which usually takes 10-12 work days.
What To Do If You Come From The EU
If you come from the EEA (Economic Euro Area) or Switzerland, you and your family have the right to stay in Ireland for a period of 3 months. So, you will not need a residence card.
Over 3 months, you must comply with at least one of these conditions to remain in Ireland:
- be employed or self-employed;
- have enough economic resources to ensure that you do not become a burden on the social services of Ireland;
- have a sickness insurance, which covers you in case of health issues;
- be enrolled as a student;
- be a family member of a EU citizen in one of the previous categories.
Therefore, if you are an EU citizen, you have the same business possibilities of an Irish citizen.
What To Do If You Come From Outside of The EU
In Ireland there are 2 programmes available if you come from outside of the EU:
- STEP (Start Up Entrepreneur Programme);
- IIP (Immigrant Investor Programme).
STEP (Start Up Entrepreneur Programme)
If you do not come from EU or from Switzerland, the STEP (Start Up Entrepreneur Programme) allows a person with an innovative idea and with a minimal fund of EUR 75,000.00 to start a company in Ireland.
The final objective of the STEP programme is to support a HPSU (“high potential start-ups”).
Moreover, for all non-EEA (Economic Euro Area) entrepreneurs there is a special immigration permission available of 12 months in Ireland to join bootcamps, which are fundamental to prepare their start up.
This special permission is also available for all students that come from outside of the EU, who studied and graduated in advanced STEM (Science, Technology, Engineering and Mathematics) and want to create their start up.
To apply for the STEP, you must complete the specific application form.
IIP (Immigrant Investor Programme)
If you are a non-EEA national, you can also avail of the IIP (Immigrant Investor Programme). It’s a program open to all that come from outside of EEA (Economic Euro Area) who want to invest in Ireland.
There are 3 conditions for applying to the IIP:
- a minimum investment of EUR 1 million is required; this amount must be owned and not borrowed;
- this amount must be employed for the duration of 3 years;
- the application must be approved by an Evaluation Committee.
To apply for the IIP, you must complete the specific application form.
Costs Of A Start Up In Ireland
Administrative Procedure Costs
Building up a start up in Ireland is simple and not as expensive as one would think.
The total cost is several hundred euros. The cost items are:
- oath before a Commissioner for Oaths: EUR 10;
- registration of a new business to CRO: EUR 50 (telematic format) or 100 euros (paper format);
- registration of the business name to CRO: EUR 20 (telematic format) or EUR 40 (paper format);
- registration of a partnership to CRO: EUR 2.50;
- or the registration of a limited company to CRO: EUR 300 (only paper format);
- opening of a bank current account: every bank applies different costs, but it is not expensive in general. The main cost that you will need to pay is a maintenance fee.
If you want to create a start up in Ireland, there you will find one of the best taxation systems in Europe. The tax items to pay are:
- Corporation tax (trading activity): 12,5%;
- VAT (Value Added Tax): you only have to pay the VAT if your company provides services for a sales over EUR 37,500 per annum; instead, if your company sells goods, you only have to pay the VAT if its sales volume is over EUR 75,000;
- Pay Related Social Insurance (PRSI – only if your company hires employees): it’s established at 8,5% or 10,75%. If you are a self-employed, you will pay class S of social insurance;
- Relevant Contract Tax (RCT): you have to pay this item only if your company hires a sub-contractor in the construction sector. The rates of tax are 0%, 25% and 35%.
In Ireland there are some tax reliefs for start ups. For example, start-ups with less than 10 employees can receive claims of up to EUR 25,000.
Staff Costs Of A Start Up In Ireland
If you want start up a business, you will probably hire one or more employees.
In Ireland, the cost of living is higher than the EU average; therefore, employees’ salaries are also relatively high.
Since the 1st of January 2019, the national minimum wage in Ireland is €9.80 per hour.
Consequently, the average salary of a Dublin employee is higher than the average salary of an employee in other cities such as Galway, Cork or Limerick.
Office Space Rent Of A Start Up In Ireland
If you establish a start up in Ireland, you may need to rent office space, because you have to provide a registered address during the registration of your start up.
In many ways, Dublin – and Dublin’s surroundings – are perhaps the best places to setup and grow your start up in Ireland.
Most of the key players in the Irish startup ecosystem – such as University startup programmes, Enterprise Ireland, business angels, investors etc – are based in Dublin, which could help your startup in getting support and funds.
Your startup can have easy access to Dublin’s airport, to the railway network and to the main motorways connecting Dublin with the main cities in Ireland – and to Belfast as well. This would facilitate reaching and meeting with clients and partners.
The majority of the big corporations with a presence in Ireland are usually based in Dublin. If you develop a product or a service targeting this type of clients, you will probably find that they have their headquarter and offices in Dublin, in the IFS (the International Financial Services) district on the docklands, in the Silicon Docks where companies like Google and Facebook are located, or in one of the many business parks such as the East Point Business – headquarter of many global corporations such as Cisco and Virgin Media – Leopardstown, Stillorgan, Sandyford, Citywest.
On the other hand, finding affordable office space to rent in Dublin or its surroundings might prove a real challenge for your startup, particularly in the initial phase before raising funds or generating a constant flow of revenue. Dublin is indeed the most expensive area in Ireland from this point of view.
Even, rental prices of prime office properties in Dublin are even among the highest in Europe, according to Knight Frank’s data published on Statista.
Dublin rental costs – for both residential and business purposes – have been growing considerably in the last few years, and might keep rising for a few years according to recent reports.
The Irish Government is trying to tackle the rent inflation. The IDA – Ireland’s inward investment promotion agency – is implementing schemes to develop office spaces in Dublin.
In the meantime, one of the best options to save money on rental spaces could be to rent and live in other places in Ireland.
Cities like Galway, Cork or Limerick are definitely less expensive than in Dublin. A recent analysis by Cushman & Wakefield, commented on The Irish Times, shows that the estimated cost of office space in those cities is half the price of Dublin, with an average of EUR 300 (in Limerick) to 350 (Cork) per square meter.
Another good reason to pick a different Irish city than Dublin, if you are moving to Ireland to set up you startup, are the overall costs of living.
Living costs in Dublin are even higher than those in London, according to The Economist magazine’s business intelligence unit, which ranks Ireland’s capital 19th out of 133 cities in their Worldwide Cost of Living 2019 report.
On the other side, the cost of living in regional locations in Ireland compares exceptionally well to other competing cities, says the IDA.
All the main cities in Ireland offer affordable office spaces, structures to support your setting up and growing, and business parks where you can base your startup or find bigger clients to sell to.
Even just moving outside of Country Dublin will allow you to save considerably on these types of costs. For example, our headquarter is based in Drogheda, Meath County.
Low-cost options for your startup office in Ireland
If you don’t want to rent an office, there are some low cost solutions.
The most simple is registering your start-up with your Irish home address.
You can also use desks provided by various business communities throughout the Irish nation.
Some of them are even provided for free, such as the Workbenchspaces offered by Bank of Ireland in several Irish cities.
Co-working, hot desking and virtual offices are other possible options.
Through co-working and hot desking, startups share the same desks and office space, benefiting from collaboration, ideas exchange, sense of community, sharing common resources and spaces. Rates for this kind of options are usually more affordable than renting an office space just for themselves.
You can read our article to understand what is a coworking space, what are the adavantages of working there and what you have to consider while choosing a coworking space.
An interesting service is provided by Workthere: it is an online platform that allows users to look for and rent a flexible work place that better suits their purposes.
The company operates in Europe, Asia and America: a local expert will guide and advise customers through the whole process. It is backed by Savills, a leading global real estate business.
Our #spaceoftheweek goes to this beautiful space in #Dublin‘s Georgian District. Not only does it offer well-equipped office space, it also boasts a bar and restaurant perfect for entertaining clients. https://t.co/wT9sqtZCTp pic.twitter.com/Olqnzbac9H— Workthere (@work_there) August 2, 2019
ThinkBusiness.ie provides an extensive list of coworking spaces available for startups and freelancers in Ireland, and so does CoWorking.ie (here you can find their list of co-working spaces in Ireland).
You can also find hot desks and temporary office spaces available in Ireland at affordable rates through services such as WeWork.
A virtual office is a service that enables employees and business owners to work remotely by providing a range of business functions accessible through the internet. Organisations can create and maintain a presence in a desirable location without the need to pay rent for an actual space.
Another interesting solution is provided by The Digital Hub: this is the largest cluster of technology, digital media and internet companies in Ireland.
The Digital Hub offers businesses who operate in the digital or technology sector the opportunity to join their community.
Not only provides office spaces for companies in its campus in Dublin City Centre, but also offers regular seminars, workshops and business clinics, even though it can’t be considered as an incubator.
As a matter of fact, The Digital Hub doesn’t provide structured business mentorship: main goal of the project is to create a stimulating environment and networking between companies who work in the campus.
Financial Grants & Support For A Start Up In Ireland
Funding is always a critical issue for start-ups.
Starting a business in Ireland will allow you to get access to a number of support programmes, funding and investment opportunities available to early-stage companies and those in growth phases through public (government) funding grants and private sector sources such as VC funds and other capital providers.
Public/Government Financial Supports
There are over 170 different Government supports for Irish Startups and small businesses. In this paragraph we will identify the main institutes and programmes.
There are many institutes that provide grants and financial support to help setup and grow startups.
One of the most familiar is the Local Enterprise Office, which is usually the startup’s first local point of contact for advice, information and support, but also for your first grants.
The Local Enterprise Office range of financial supports helps you establish and grow your startup or small business provided it employs up to ten people. Among the available grants, you can get Feasibility Study Grants, Priming Grants, Business Expansion Grants, Brexit Supports for your small Business and more.
The new & exclusive Insight Magazine is packed with inspirational & practical advice and tips for those who are starting a business!— LocalEnterprise.ie (@Loc_Enterprise) November 14, 2019
Register now and find out how #LocalEnterprise can help in #MakingItHappen for YOUR #StartUp !
Go to https://t.co/SSfS51edQt@LAsIreland @EI_HPSU pic.twitter.com/ZhXAHMWpmd
When your startup starts scaling, you usually get in touch with Enterprise Ireland, the government agency responsible for the development and growth of Irish enterprises in world markets.
Enterprise Ireland offers a range of supports and grants that are available to Irish businesses. Their funding programmes are open to anyone, from entrepreneurs with a business idea that have the potential for a Startup, to large companies that want to expand their business activities, improve efficiency and grow sales.
Enterprise Ireland implements different support programmes including HPSU, Competitive Start Fund, New Frontiers and the Regional Enterprise Development Fund.
Challenges have always been a part of business, but today’s are bigger & more complex than ever before. There will be more questions to answer & more obstacles for Irish companies to overcome.— Enterprise Ireland (@Entirl) September 6, 2019
But, together, we’ll help turn these challenges into opportunities.#IrishAdvantage pic.twitter.com/jE9tdk6Ob4
HPSU is a well-known programme in Ireland. HPSU is the acronym of “high potential start up”.
In order to apply for HPSU, your business should have, first of all, the potential to become an innovative product or service for the international market.
If your start up meets some binding requirements, it can be considered a HPSU and could receive grants. The binding conditions are:
- introduction of an innovative service or product in the international market;
- involved in international trading or in manufacturing;
- able to create 10 jobs in Ireland;
- producing EUR 1 million within 3 years of starting up;
- led by an experienced management team;
- headquarters in Ireland;
- less than 5 years old.
The Competitive Start Fund helps accelerate Startup companies capable to become High Potential Start-Up (HPSU) companies.
The purpose of this fund is to accelerate the growth of start-up companies that have the potential to succeed in global markets. The fund is designed to enable those companies to reach key technical and commercial milestones.
The fund offers €750,000 funding and is open for applications several times throughout the year with calls made for specific sectors, female-led Startups, and entrepreneurs based outside of Ireland.
Funded and managed by Enterprise Ireland, New Frontiers is a national entrepreneur development programme for early-stage startups. It is based in 16 campus incubation centres across the country.
This programme is concerned with developing more early-stage ideas (0-6 Months) from a business concept to an investable business and it is one of the best ways to get money if you are a Startup in the early stages.
The New Frontiers programme is run over three Phases in order for you to gain the confidence and skills to develop your business idea. See the diagram below to get an insight into the Three Phases of New Frontiers! #GlobalAmbition @Entirl pic.twitter.com/syJsD4qRvZ— New Frontiers (@EI_NewFrontiers) November 13, 2019
Main purpose of this Office is to facilitate and help economic activity in Dublin. The development of a Business Support Unit is one such initiative being undertaken.
The unit will provide information on, and co-ordinate access to the range of Dublin City Council services that are required for setting up or growing a business.
Private Financial Support
There are several Private Sector Funding options available to Startups.
Incubators, Accelerators & Early-stage Startup Programmes
Quite a number of public and private incubators and accelerators offer funding to early stage startups attending their programmes.
Almost all of these programmes provide some form of funding to participants in addition to mentoring, incubation space, workshops and more.
The Dublin-based NDRC, recognized as one of the best tech incubators in the world, is perhaps the most-known option of this kind for Irish early stage startups. They are an early stage investor in tech startups which meets significant global unmet market needs or problem, and invest up to €135,000 per company.
Other similar structures offering funding, office space, investors-ready programmes, mentoring and access to partners and investors networks are TCD, Rubicon, DCU and Dublin BIC.
Rubicon, jointly financed by CIT (Cork Institute of Technology) and Enterprise Ireland, offers a range of programmes to support entrepreneurship and funding via their Rubicon Angel group – a collection of individual investors who meet as a group to review potential companies seeking investments.
This morning we launched our #ScaleCork Programme for SMEs who are in the #Medtech, #agritech and #DigitalHealth sector, the first of its kind in Ireland, supported by @Corkcoco and operated at the Rubicon Centre. Find out more here: https://t.co/nWp7KGdVJk— Rubiconcentre (@rubiconcentre) November 4, 2019
Pic: Brian Lougheed pic.twitter.com/cBpPbxL9C8
The DCU Ryan Academy – belonging to the Dublin City University – financially supports entrepreneurs and early stage startups via several programmes and funds such as the Propeller Seed Accelerator Fund. The three-month Propeller Venture Accelerator programme is sector agnostic and offers €30,000 seed funding plus €15,000 in services costs to early-stage entrepreneurs with winning ideas.
Another interesting programme powered by DCU is the DCU Ustart: it is a free accelerator programme open to DCU students. 6-10 student led startups are annually selected to take part in UStart.
€30,000 in business development funding is shared between participating teams. The programme culminates in a Demo Day when students will get to showcase their product to the key players of the Dublin startup eco-system.
Some of the accelerator programmes running in Ireland have a specific industry focus, so it’s always a good idea to research the market and check whether your startup could raise the initial funds through a perhaps less-known but more tailored programme.
For example, the Yield Lab is an Agtech accelerator which invests €100,000 equity in a number of early-stage companies each year. Their European operations are based in Ireland.
Propeller Shannon is another great example. This programme for aviation and tech travel startups, ran from an innovation centre at Shannon Airport, offers a €45,000 seed investment in return for 7.5% equity in addition to a 4 month accelerator programme.
Another important private institute that can support your small business is InterTrade Ireland.
InterTrade Ireland is a cross-border body, covering the Republic of Ireland and Northern Ireland, which offers a guide to become ‘investor ready’. Additionally, they specialise in early-stage Startups and provide a range of services and advice. They deliver a number of programmes which can provide direct funding for your startup or small business: FUSION, Elevate and Acumen.
Their Seedcorn competition is another funding opportunity for Startups – primarily, startups who require new equity funding as funding received can reach to €280,000.
Business Angel Funding
Business angels are another form of private financial support available to early stage startups. A business angel:
- is an individual investor;
- invests an amount between EUR 50,000 to 250,000;
- invests during early-stage.
A business angel network is a group of many business angels who want to invest together.
Halo Business Angel Network (also known as HBAN) is the biggest and most known business angel network in Ireland. It’s made up of 10 angel groups and syndicates and offers investment to companies that are usually based in Ireland and in the Technology, MedTech, AgriTech or Food industry.
Full house at all our #HBAN2019 Masterclasses and we’re even more delighted to see such a Strong Female presence at this year’s All Island Conference ?#BusinessAngels #FemaleInvestors pic.twitter.com/yZu1MC5WvB— HBAN (@HaloIreland) February 14, 2019
Venture Capital Funding
You can also receive private support from a venture capital (VC), which is a fund composed by many investors. A venture capital:
- invests an amount over EUR 1 million;
- usually invests in established businesses and not during early-stage like business angels do;
- wants a seat on the board of the company.
According to PitchBook data, there were nearly 200 VC deals in Ireland in 2018 worth around €553m, a higher number than the previous year but lower than 2016 peak point of more than €632m. The data exclude Enterprise Ireland’s deals.
The Irish Venture Capital Association (IVCA) is the main VC association in Ireland and represents venture capital both in the Republic of Ireland and Northern Ireland. Its full members are venture capital firms which provide equity funding to growing unquoted companies.
Among the most active venture capitals in Ireland are Delta Partners, Act Venture Capital, Kernel Capital and Frontline Ventures. Silicon Republic compiled a good list of the most active VC investors in Ireland.
Same people, new clothes. 2019 marks #25years of #venture investing for @ACTvc and we are excited to announce our new brand identity and look forward to the growth of technology in our lives over the next 25. pic.twitter.com/HvLHOmHh4W— Act Venture Capital (@ActVC) June 4, 2019
Obtaining venture capital funding is not easy. VCs are looking for very specific types of firms with massive growth potential. They usually invest only in entrepreneurs with a solid track record of scaling up businesses that have billion-dollar potential and that is why it is so hard to attract a VC’s attention.
Still, this is one of the best ways to raise big amounts of capital among new businesses. Enterprise Ireland offers good resources to understand if Venture Capital is a suitable path for your startup.
Another opportunity to get funding comes from crowdfunding.
Crowdfunding consists in funding a project or venture by raising small amounts of money from a large number of people (friends, family, customers, and individual investors), typically via the Internet.
This approach taps into the collective efforts of a large pool of individuals – primarily online via social media and crowdfunding platforms – and leverages their networks for greater reach and exposure.
A 2013 report on the potential of crowdfunding for the developing world by The World Bank states that “crowdfunding has emerged as a multibillion-dollar global industry” and that “crowdfund investing platforms fill a void between microfinance and professional/institutional investors”.
In a few years, the crowdfunding market has indeed become a massive industry, projected to reach $300 billion by 2030.
There are three main types of crowdfunding:
- reward crowdfunding
- donation crowdfunding
- equity crowdfunding
Equity crowdfunding allows contributors to become part owners of a company by trading capital for equity shares, receiving a financial return on their investment and ultimately a share of the profits in the form of a dividend or distribution.
Equity crowdfunding is the most appealing type of crowdfunding to startups, but still represents a minority. 2017 data reported by Statista show that equity crowdfunding generated worldwide 2.5 Billion U.S. dollars in 2017 out of a total volume of funds raised through crowdfunding of 38 Billion U.S. dollars.
Many startups have raised funds via reward crowdfunding as well, so you should definitely take all the options into consideration.
A good article on startups.com offers you useful insights into this fundraising channel.
Irish startups can raise crowdfunding money through crowdfunding platforms particular to the Irish market including:
- Linked Finance – p2p business loans
- Kickstarter Ireland,
- Spark – equity crowdfunding
- SeedsUps Ireland – equity crowdfunding
- Irish Investment Network
Ireland’s very favourable tax regime helps make companies based in Ireland more attractive to investors. This includes a low corporation tax rate of 12.5% combined with favorable double tax agreements.
This generous tax regime is also beneficial after you become profitable. If you are hoping to sell your business, it can make your company a significantly more attractive acquisition target.
Ireland also offers generous Research and Development (R&D) Tax Credits to start-ups in Ireland. Even if you are in the loss making start-up phase, these tax breaks may provide immediate cash flow benefits.
For example, you could eliminate or reduce your social security contributions by crediting them against your R&D spend.
There is also an Employment Investment and Incentive Scheme (EII) which provides tax relief for Irish taxpayers who invest in certain companies.
Many Irish entities provide support services to entrepreneurs and startuppers.
The first place to get help would be your Local Enterprise Office.
Business support from the 31 dedicated Local Enterprise Office teams covering Ireland includes Start-your-own-business training courses, market research information, business planning advice and templates, access to experienced business mentors, feasibility grants and co-investment for your plans.
We have already mentioned incubators and accelerators such as NDRC, Rubicon, TCD, DCU Ryan Academy. There are many others like the Guinness Enterprise Center, Dublin Institute of Technology Hothouse, NovaUCD etc.
Philip Donnellan of @digigrow_ie speaks to Hothouse Entrepreneurs about Good & Bad SEO ‘ever want to hide a body, you can do so on page 2 of Google…no one will ever find it!’ Do you click on page 2?— TU Dublin Hothouse (@Hothouse_TUDub) September 25, 2019
#TUDublinHothouse #WeAreTUDublin pic.twitter.com/OSKxdkBrdC
One of the most important programmes of the many mentioned above is Guinness Enterprise Centre.
It is an incubator managed by the Dublin Business Innovation Centre: the main goal of the centre is to become one of Europe’s leading entrepreneurial hubs.
Guinnes Enterprise Centre offers various useful services to entrepreneurs and startuppers, such as a strong and supportive entrepreneurial community, fundraising assistance, accelerator programmes and regional and international partnerships.
There are also companies like DogPatch which is a private-funded startup hub in the heart of Dublin’s Digital Docklands, providing places and services for startups to help them grow, share knowledge and form connections. They focus on tech startups and currently host over 45 companies employing 300 people.
Most of the incubators, accelerators, and co-working shared spaces mentioned above offer hot desking, private offices and meeting rooms, event hosting, hackatons, meetups, workshops, mentoring, coaching, investor-ready programmes, and in general access to expertise, partners, clients and funding.
A very interesting programme is Going for Growth: it is designed to support female entrepreneurs who want to grow their Ireland based businesses.
Participants are offered a unique learning environment with a peer led approach based on the shared experiences of both experienced female entrepreneurs and other participants facing common challenges.
The initiative has been endorsed by some successful business women who have agreed to take part in the initiative as Lead Entrepreneurs.
In 2015, Going for Growth won at a National level for the Investing in Skills category of the European Enterprise Awards 2015.
This award recognises initiatives at regional or local level to improve entrepreneurial, vocational, technical and managerial skills.
Another interesting entity is Scale Ireland: this is an independent non-profit providing the bridge between the startup ecosystem and government.
Main mission of this project, is to secure a more supportive policy environment that empowers Ireland’s innovation-driven enterprises to succeed and scale.
In order to do this, Scale Ireland, regularly communicates with the Irish Government and policy makers.
There are also corporate programmes which support and invest in startups with business models focused on specific products or services.
MasterCard’s Starpath, for example, has an eCommerce and Fintech focused accelerator for innovative early-stage European startups.
Another interesting programme is Startup Boost. This is a global tech startup pre accelerator which operates in different Countries.
Startup Boost helps early stage entrepreneurs to develop their ideas and prepare them for accelerators or seed investments through a 6 week programme.
The company provides part time classes with local expert speakers and mentors who will help wannabe startuppers to scale their businesses.
Talent Garden is a global tech platform which helps entrepreneurs to scale their business. It offers different types of support such as coworking, office spaces, digital and innovation training and promotes connections between professionals involved in the tech sector.
Talent Garden Dublin is in Dublin City University’s Innovation Campus, DCU Alpha.
Helpful Resources For Your Startup
Awards & Competitions for Startups in Ireland
In Ireland there are many competitions and awards for startups which may definitely help entrepreneurs set up and scale their businesses.
National Start up Awards
In Ireland, it is widely considered the most prestigious award for startups and businesses in the early stage.
It’s a prize open to all sole traders, partnerships or corporate which are based and trade in Ireland.
This competition comprises 13 different categories.
Winning this competition, as well as receiving the Startup Awards Winner Trophy, gives Startups the opportunity to receive important supports: what’s more they will have the chance to represent Ireland in the Startup Europe Awards.
The latest event took place in Dublin’s City Hall on the 24th of October 2019.
Google Adopt a Startup
Adopt a Startup is a startup mentoring programme powered by Google.
Its mission is to help high potential Irish startups grow: through exclusive lectures and workshops, Google employees provide small startups with the tools and skills to scale.
The programme was launched in 2014 and since then Adopt a Startup has involved over 130 ambitious Irish startups.
The programme lasts 8 weeks and includes various activities, including 1 on 1 mentoring with expert Googlers, and group lectures and workshops.
At the end of the programme, startups showcase the improvements achieved during the event and a panel of judges awards the startup that got the best results.
Winners usually receive up to €10,000 Ads credit and €100,000 Cloud Credit from judges.
Student Enterprise Programme
The Student Enterprise Programme is an initiative run by the Network of Local Enterprise Offices of Ireland: it is Ireland’s largest and most successful student enterprise programme, with over 26,000 second level students partecipating each year.
Students from 1st year to 6th year get to set up and run their own business and find out what it is really like to be an entrepreneur: the programme is 8 months long.
From September to May, students get to do everything a real life entrepreneur would do from coming up with the business idea to marketing, sales and preparing a business plan.
At the end of the Programme in May, one student business from each region gets to compete at the National Final in Dublin for the ‘Student Enterprise of the Year’ award.
As today is #ThrowbackThursday have a watch of some of the very clever #StudentEnterprise business ideas that made it all the way to the National Final over the past 2 years https://t.co/x9GUq5ZMBL pic.twitter.com/4BzoS2vtMz— StudentEntProg (@StudentEntProg) October 3, 2019
Even some of the incubators and accelerators we mentioned above, such as the NDRC or the Guinness Enterprise Center, run competitions for startups offering winners the opportunity to attend a related startup programme.
NDRC Business Plan Competition 2019 will offer €24.000 to kick-start three new technology business ideas: early-stage technology entrepreneurs will have the chance to participate in pre-acceleration workshops and receive mentoring and feedback throughout the process.
The winner will have the opportunity to pitch for a place on one of NDRC’s investment programmes as well as securing a €15,000 cash prize.
In addition to these programmes, startuppers can benefit from several other awards and competitions specialized by sector or industry, or aimed at specific groups of entrepreneurs.
Here are some examples:
Saastock 2019 Global Pitch Competitition 2019 Dublin
The community’s mission is to help SaaS companies grow and scale. In order to do this, SaaStock holds annual conferences in Europe, North America, Latin America, Asia and Australasia.
Dublin is the flagship conference of the community: it is considered the best conference in Europe for SaaS founders and executives.
A Global Pitch Competition will be held in Dublin ‘19 edition: the goal is to find and recognise the best B2B SaaS startup of 2019.
Monday’s couldn’t be better with #Saastock19 in full swing ?— SaaStock (@SaaStock) October 14, 2019
Here are some action shots ? of this morning’s workshops! We’ve already had a ton of discussion from our Outbound Sales Bootcamp through to @Chargify’s session with their CEO, Paul Lynch ✅?#Saastock19 pic.twitter.com/pYRf3AY5Z3
Winning this award will give startuppers the chance to receive a $25000 prize, global recognition, partner perks and media & Pr exposure.
In order to take part in the competition, startups must fulfill some requirements: in fact, judges are looking for SaaS startups only, which have an ARR up to $3 M, and have products built and ready to demo.
Winners will be selected on the basis of these criteria: innovative or disruptive products, high rate of growth and readiness to go global.
The Imagine Cup is a race for third level students which allows them to develop their ideas in startups.
Organised by Microsoft, this competition receives considerable support from the Irish business community. That’s probably because their last 8 editions were held right in Ireland.
Winning this competition, as well as the trophy, will provide mentoring sessions, network opportunity, money and many other prizes.
Becoming a #MSFTStudentPartner is a chance to learn, lead, and share to make an impact in your community. Hear from students in the program about their experience and why they think you should join too! The next round of applications are due November 30, don’t miss out. ????— Microsoft Imagine Cup (@MSFTImagine) October 12, 2019
Ireland Best Young Entrepreneur
It’s a competition run by the Local Enterprise Offices (LEOs) for startups, and has 3 categories:
- best business idea;
- best start-up business;
- best established business.
This is a competition open to all people who fulfill these 3 requirements:
- between 18 and 35 years old;
- with an innovative business idea;
- new start-up or established business.
The local winners and the runner ups will be awarded by every LEO: the local winners in the Best Start-Up and Best Established Business categories at county level will receive investments of up to €15,000 each and the two runners-up will each receive up to €5,000.
Up to 450 young entrepreneurs will be invited by the LEOs to attend free regional Entrepreneur Bootcamps later in the year to help them develop their business and new venture ideas.
Events For Startups in Ireland
Attending tech events is very important for startups. The main reason for that is that you can meet other entrepreneurs or people that might help you set up your startup.
In fact, it is not so rare to find working collaborations at these events.
There are many other reasons, for instance, many investors – like business angels and venture capitalists – attend these business events.
So, this could be your chance to meet them and build a business relation to obtain funds for your startup.
A perfect example of this kind of events is Websummit: considered by many one of the best tech conferences in the world, it was held in Dublin for a while.
The event recently moved to Lisbon, Portugal and the 2019 edition will take place on November the 4th. Last year, over 70,000 people from over 160 countries attended Websummit.
Over the years, it has become a global meeting point for tech experts and dynamic entrepreneurs.
70,469 attendees— Web Summit (@WebSummit) November 13, 2019
163 countries#WebSummit 2019 was our biggest yet ?
Wait until you see 2020 ? Sign up to be part of Web Summit 2020 and save 50% on tickets ? https://t.co/wZN0QsDYW3 pic.twitter.com/e2rZYd9dSq
Here are some of the most important events for startuppers in Ireland.
Techstars Startup Weekend
Techstars Startup Weekend is the place to look for a team, create a prototype of your idea, validate your business idea, and receive feedback from experienced entrepreneurs, all in one weekend.
It takes place in Dublin and tickets costs between €22 and €55.
Your ticket includes:
- 7 full meals over the course of the weekend
- Benefits and discounts from global partners
- One-on-one time with mentors
- A new network of developers, designers, and entrepreneurs
Uprise Festival is a talent and tech festival designed for CEOs, founders and those making great products all over the world.
The program includes workshops and side events for new projects and startups.
The 7th edition of this festival will take place on October 17th in Dublin.
We’re delighted to announce that @DubCityCouncil will be the host Sponsor of 1 of our 2 main Stages during our 7th UPRISE Festival Europe.— UPRISE Europe 2018 (@festivaluprise) June 14, 2018
We’ll be working on our #smartcities #talent #recruitment #blockchain #startups Content with them for 2 Days of Tech, Talent and Culture. pic.twitter.com/HkG8ienVyV
FutureScope has become a must-attend event for everything, from start-ups to multinational companies that are active in Dublin’s tech space.
It is considered one of the best innovation events in Ireland and it is the only conference dedicated to exploring new business opportunities arising from new technologies, such as A.I., 5G, robotics and AR/VR.
During the event, the attendees can take part in different activities, such as keynotes, panel discussions, Innovation showcases, tech demonstrations and workshops.
It is organized by Dublin BIC (Business Innovation Centre), a not-for-profit organization that provides a range of different programmes for early stage startups, such as funding, incubation spaces and knowledge sharing.
On March 28th 2019 Dublin BIC are bringing together the ecosystem at #Futurescope— Dublin BIC (@BICDublin) November 26, 2018
Join us as we offer a platform for all businesses to share, network, collaborate and learn. Super Early Bird Tickets on sale now: https://t.co/KdRbPfJ09f @DCCEconDev @responsibleinno @HaloIreland pic.twitter.com/7zq9KxsZ3l
First Fridays for Startup
First Fridays is a recurring event series hosted on the first (non-holiday) Friday of each month, powered by Google for Startups and hosted by Dublin’s Dogpatch Labs.
It is a platform designed for the tech startup ecosystem and its goal is to bring startups’ founders together on a regular basis, enabling them to learn, connect and grow.
At the event, participants have the possibility to attend a 1 on 1 mentoring session for startups with a variety of curated mentors, ranging from Google experts to founders to investors and more.
The day usually ends with a Keynote speech from an expert in the field of tech business.
Startup Week Dublin
Startup Week Dublin is powered by the Dublin City Council.
Startup Week is a global event series created to help inspire and strengthen the city’s entrepreneurial and innovation community.
Startup Week combines free networking events, keynotes, panel discussions and workshop sessions on topics such as how to get started, joining a tech startup, finding funding, marketing for startups and sales training.
The next event will be on September 26, and will be set in Dublin, at City Hall, Dame Street.
Pitch Perfect – Pitch your startup
Pitch Perfect is an event where young entrepreneurs pitch their businesses to Equity Crowdfunding investors.
This free event is a great opportunity for entrepreneurs to pitch their idea/start-up and to learn about other start-ups. Not only do participants have the chance to pitch to the panel of judges, investors, angels and successful start-ups, but also to get market feedback from the audience.
There are two categories of tickets: General Attendees and People Pitching.
The event is organised by NovaUcd: it directly supports over 1,040 jobs and has raised over €760 million in equity funding.
Pitch Perfect is set in Belfield, at the Nova Innovation Centre Nova Complex.
Dublin Tech Summit
Dublin Tech Summit is a two-day global tech conference and is held in Dublin at RDS during April.
DTS brings together some of the most influential tech and business leaders to Dublin for two days of growth & development, knowledge sharing, covering the latest trends,and networking.
Exploring different themes and topics such as emerging technologies, diversity, scaling for startups and much more, they have built a community of innovators, co-founders, developers, and c-level decision makers that are turning ideas into reality and affecting global change.
With 10,000 attendees from over 70 countries, 200 speakers and 300 global media representatives, DTS has become an extremely attractive platform for the world’s leading brands and companies to accelerate growth within the Irish market.
The dates are set for DTS20! Join us April 22nd & 23rd 2020 for the next instalment of Europe’s fastest growing tech event! We have a 2 for 1offer on our Super Early Bird tickets available now. Offer ends 01/05/19 https://t.co/KR60M97hCh #DTS20 pic.twitter.com/O3K8CbRHWR— Dublin Tech Summit (@DubTechSummit) April 24, 2019
TechConnect is a free event taking place yearly in Dublin’s RDS.
It is a business and technology exhibition for Micro, SME, and Enterprise level companies.
In the last edition 200 speakers have offered free training to over 5000 delegates.
The Start Summit
The Start Summit is an event dedicated to early stage entrepreneurs in order to accelerate their business journey.
During The Start Summit, attendees will have the opportuniy to join keynotes, panel discussions and workshops from some of Ireland’s most successful business people.
Attendees will leave with a fresh perspective on business, invaluable information for their own startup ideas and great business connections.
Powered by The University of Life, the event will take place on June 6th 2020, at Dublin Castle.
Take a look back at some of the highlights from #TheStartSummit last weekend.— The University Of Life (@TheUniversityO) June 12, 2019
We’re also thrilled to announce the launch of #TheStartSummit 2020!! It will be held on the 6th of June in Dublin Castle.
Avail of early bird tickets on our website now – https://t.co/JnjxVEgNbu pic.twitter.com/MTUSKSkuIM
World Machine Learning Summit
The World Machine Learning Summit is a programme designed to help data engineers, analytics professionals and tech start-ups develop the machine learning skills to create a competitive advantage for their businesses.
The event takes place in Dublin DCU All Hallows Campus: in the last edition of the Summit, tickets price ranged from €280 to €430.
ESB Creative Tech Fest
Esb Creative Tech Fest is an event powered by TechSpace: this is a national movement that provides opportunities for young people to be creative using technology.
It aims to become Ireland’s leading creative technology network for educators to train and upskill in digital creativity and STEAM.
Over 500 young people aged 10-18yrs, from 70 youth groups across ireland, are attending the 2019 ESB Creative Tech Fest in @theccd today. Join the conversation follow #ESBCTF for live updates all day. pic.twitter.com/ribDHbNNYf— TechSpace (@TechSpaceTweets) October 30, 2019
It designs and delivers training, activities, resources and opportunities through English and Irish youth workers, teachers and volunteers.
During the Tech Fest, over 20 awards are given to young people aged 10-18 and to TechSpace educators from youth projects and schools in Ireland.
Once you have decided to start your business adventure in Ireland, you will need some help and advices.
Web communities, online tech magazines and podcasts are perfect to keep up with what is happening and what is going to happen next in the startup business.
There are many useful tools and publications available online, which will definitely help you run your new Irish company.
An excellent example is Dublin Economic Monitor: it is an online platform which publishes a regular bulletin on trends in the Dublin economy.
One of the main goals of the Monitor is to develop and publish new data series each quarter to increase understanding of the Dublin economy performance.
Coordinated by Dublin City Council and overseen by Jamie Cudden, the Monitor represents a further manifestation of the enhanced role of local authorities in the area of economic development and enterprise support.
Web Communities Focused on Startups
An excellent example is startups.ie: established in 2005, it is Ireland’s largest and most comprehensive advice platform providing help and guidance to everyone who’s willing to launch their own startup in Ireland.
Another very useful web community is startupgrind.com: they have similar goals and facilities to www.startups.ie, and it was founded in Silicon Valley.
The main difference between the two is that www.startupgrind.com is a global community: in fact, they operate in over 125 countries and, by now, they are the largest independent startup community.
Startupgrind collaborates with more than 2 million entrepreneurs all over the world and cooperate through events, media and partnerships with the most important companies on earth, like Google for Startups.
Keeping track of all the news concerning business, technology and finance is vital for a Startup owner: there are several online magazines that specifically regard Irish business world.
Here’s a list of important online publications that we recommend you check out:
Newsletters are still a fantastic tool to stay up to date with startup-related events, trends, awards etc. We follow quite a few high-quality newsletters which provide plenty of useful info on the Irish startup ecosystem. Some recommendations:
- Enterprise Ireland’s newsletter
- Your Local Enterprise Office newsletter
- Startup Digest (Curator: Stacey Connolly)
- Startup Dublin
During the late 2000s podcasts have become extremely popular: these are episodic series of digital audio or video files that a user can download from the net in order to listen to them or watch them.
During the years, many business and startups-related experts have understood the huge potential of this medium and have begun to host podcast shows having business and innovation as their main subject.
These podcasts are a very helpful resource for startuppers and entrepreneurs looking for advice and inspiration: here are some examples of popular podcasts shows concerning Irish and global business.
- The Big Tech Show, with Adrian Weckler. Promoted by The Independent.
- Partners in Business, in association with National College of Ireland. Promoted by The Independent.
- In Focus. Promoted by The Independent.
- Tech Talk with Jess Kelly. Promoted by Newstalk.
- Startup Grind Podcast. Promoted by Startup Grind.
This is a simplified guide to help you take your first steps while setting up your startup in Ireland.
If you wish to make any enquiries please contact Farrelly Caizzone & Associates.
(Image credits: Teresa Di, pexels.com)