Small businesses in Ireland: How to get funding for your start-up

For most start-ups, there comes a time in the business's development when the founders need to consider how best to fund their company.

Here, we take a look at the wide range of funding options that might be available to you as you get your business off the ground.

Disclaimer: The information in this blog was correct at the time of publishing (September 2024).

Government grants and schemes

Government funding is often one of the most accessible and attractive options for entrepreneurs in Ireland.

A variety of grants and schemes are available to support the development and growth of small businesses, from early-stage start-ups to established companies looking to expand.

Here are some of the key government funding opportunities you can tap into in 2024.

Local Enterprise Office (LEO)

The Local Enterprise Office (LEO) provides a range of supports for small businesses, including several grant schemes that can be a lifeline for entrepreneurs at different stages of their venture into business.

Whether you're just starting out or planning to expand, LEO offers practical funding options designed to help your business thrive. Here are some of your options:

Priming Grants

Priming Grants are designed for businesses in their first 18 months of trading. This funding can be used for a range of business expenses when starting out, including capital items (like equipment), marketing and salary costs for employees.

The grant can provide up to 50% of eligible costs, with a maximum amount of €150,000.

If you're in the early stages of building your business, you can use this grant to cover crucial costs during those formative months. That will allow you to focus on growth and development without immediate financial strain.

Business Expansion Grants

For businesses that have moved beyond the start-up phase and are looking to grow, Business Expansion Grants offer essential support. They are tailored for companies that are expanding their operations, investing in new equipment or increasing their workforce.

As you reach the growth phase, a Business Expansion Grant can provide much-needed capital to take your businesses to the next level. Like the Priming Grant, it can cover up to 50% of eligible costs, making it a significant resource for growth.

Feasibility Study Grants

If you're thinking of developing a new product or carrying out market research, a Feasibility Study Grant can be a game-changer. It covers the costs of assessing whether a new idea is viable, helping you explore potential innovations or expansion into a different market.

You can apply for up to 60% of the total cost, up to a maximum of €15,000.

The grant is particularly valuable if you're looking to break into a new industry or develop cutting-edge products and services. You can use the funding for market research, developing a prototype and preparing a business plan.

How to secure LEO supports

You can give yourself the best possible chance of securing LEO funding by making sure you have a clear and actionable business plan.

Focus on demonstrating how the grant will contribute to your business's growth, help you create new jobs or allow you to innovate.

Taking advantage of any business mentorship programmes from LEO can also strengthen your funding application.

Enterprise Ireland

Enterprise Ireland offers several programmes specifically designed to support high-potential start-ups and businesses that are looking to export and expand into new markets.

Pre-Seed Start Fund

Enterprise Ireland's Pre-Seed Start Fund is a valuable resource for entrepreneurs looking to grow their early-stage businesses.

Offering equity funding of either €50,000 or €100,000, this initiative aims to help start-ups become competitive and scale their operations.

The fund also includes 10 mentoring sessions, providing personalised guidance from experienced professionals. This support is tailored to help you overcome initial hurdles, develop your business strategy and strengthen your company's potential to grow.

Innovation Vouchers

Enterprise Ireland's Innovation Voucher scheme offers businesses the opportunity to collaborate with research institutions to explore innovative solutions for their products or services.

Each voucher is valued at €10,000 and can be used to partner with a knowledge provider (like a university or technology institute) to address a specific business challenge.

Entrepreneurs – particularly those in STEM fields or developing new technologies – can use these vouchers to bring academic expertise into their businesses, gaining a competitive edge in their markets.

Innovative HPSU Fund

The Innovative HPSU (High-Potential Start-Up) Fund is aimed at early-stage companies with the potential to see significant growth and export overseas.

This equity investment programme provides larger sums of funding, often in several rounds, for companies that are scaling quickly and seeking international opportunities.

If you're building a high-growth company and you have ambitions to trade overseas, the fund offers both the financial backing and strategic support to help you break into new markets. The programme also helps connect you to international networks and investors.

Find more Enterprise Ireland funding and grants

Údarás na Gaeltachta

If you're operating in the Gaeltacht regions (Irish-speaking areas), Údarás na Gaeltachta offers tailored supports to encourage growth while preserving the region's cultural and linguistic heritage.

Technical Assistance for Micro Exporters (TAME) grant

The TAME grant is an excellent opportunity for business owners in Irish-speaking regions who are seeking to explore new international markets.

It offers €2,500 (covering 50% of eligible expenses) to support activities aimed at developing your ability to export, like taking part in trade fairs, creating marketing materials and developing export-focused websites.

To qualify, your business must have fewer than 10 employees and be engaged in manufacturing or internationally traded services. This funding can help you expand your reach and grow your business globally, especially if you're looking to target new markets.

Feasibility Study Grant

The Feasibility Study Grant offers financial support to entrepreneurs in Irish-speaking regions to assess the potential of their business ideas.

This funding can cover a substantial portion of expenses tied to conducting a feasibility study, including employees' wages, consultant fees, travel and any other related overheads incurred during the study.

Research and Development (R&D) Grant

This grant helps businesses create innovative products, processes or services to stay competitive.

It covers a wide range of R&D costs, including employee salaries, relevant overheads, capital assets used for the project, and expenses for external research, patents or technical knowledge.

Extra operating costs like materials, supplies, travel and subsistence directly related to the research activities can also be included.

Private-sector funding options

In Ireland, there is a wealth of private-sector funding options to tap into, including venture capital, angel investors and crowdfunding.

Private-sector funding not only provides the capital you need to grow, but also opens doors to valuable networks and mentorship.

Venture capital and angel investment

Venture capital (VC)

Venture capital is where institutional investors provide funding to start-up companies that they believe to have long-term growth potential. In return for providing funding, they take a stake in the business.

It's seen as a higher-risk investment, but VC firms believe there will be an above-average return on the companies in which they invest and that the risk is worth it.  

When seeking venture capital, having a strong pitch, a scalable business model and a clear plan for growth are key factors in securing investment.

Many Irish VC firms also offer mentorship, business development support and access to global markets.

Prominent VC firms in Ireland include:

• Frontline Ventures: Focuses on early-stage technology companies with ambitions of trading worldwide.

• Delta Partners: Invests in high-potential start-ups across various sectors, including health tech and software.

• Act Venture Capital: Provides large-scale funding for more established companies with proven growth potential.

Angel investment

Angel investors are individuals or groups that invest their own money in exchange for equity, often at the earliest stages of a business.

If you decide to go for angel investment, be sure to tailor your pitch to emphasise your business's potential and your leadership strengths.

Highlighting the market opportunity and clear path for growth is essential, but it's also important to demonstrate resilience and vision.

Building strong relationships with potential investors, attending networking events and seeking mentorship can increase your chances of success.

VIDEO: Securing angel investment

In this session, investment expert Johnny Harte chairs a panel discussion with Niamh Sterling, a small business founder who has secured angel investment:

Crowdfunding

Crowdfunding emerged as a popular alternative to traditional funding, particularly for consumer-facing products, creative projects or social enterprises.

Using these online platforms, you can raise capital from a large group of people, either in exchange for rewards or a stake in your business.

While crowdfunding offers flexibility, it's important to understand the legal and financial implications. Equity crowdfunding in particular (see below) involves selling shares of the business, which can affect your decision-making and control in the future.

As such, you should carefully weigh the pros and cons and consider consulting a legal or financial adviser before you launch a crowdfunding campaign.

Reward-based crowdfunding

Platforms like Kickstarter and Fundit allow entrepreneurs to raise funds from backers in exchange for rewards, such as early access to products or exclusive experiences.

Reward-based crowdfunding is particularly useful if you're launching a creative project or new product.

By pre-selling your products or offering unique incentives, you can secure the funds you need to bring your ideas to life without giving up equity in your business.

Successful campaigns not only raise money but also build a loyal customer base and generate buzz around your product.

Equity crowdfunding

Equity crowdfunding platforms such as Spark Crowdfunding and Crowdcube allow you to raise funds in exchange for shares in your business.

This is a great option if you're comfortable giving up a small portion of equity in return for capital and exposure.

Unlike traditional investment, equity crowdfunding lets you raise money from a broad base of investors, from small individual backers to larger institutions. Successful equity crowdfunding campaigns can give you both the funding and the validation you need to attract other investment down the line.

Bank loans and microfinance

Bank loans and microfinance options are a reliable and structured way to secure funding for your business. While private investment and government grants can be highly competitive, these more traditional financing solutions are fairly easy to access.

They are particularly useful if you're looking to start or expand a small business that may not fit the typical profile for venture capital or crowdfunding.

Small business bank loans

Most of the major Irish banks offer a range of business loans tailored to the needs of small businesses, whether in their early stages or more established and looking to grow.

Ranging from a few thousand euros to much larger sums, these loans typically come with fixed or variable interest rates and flexible repayment terms. They are commonly used for buying equipment, hiring staff, developing marketing campaigns or expanding physical premises.

You can apply for a standard business loan as long as you meet the bank's criteria, which often include having a detailed business plan, a good credit history and, in some cases, collateral (security to guarantee repayment).

Banks may ask you to demonstrate how you'll use the funds and how the business plans to generate revenue to repay the loan.

Microfinance Ireland

For businesses that may not qualify for traditional bank loans, Microfinance Ireland is an accessible alternative. It's a not-for-profit lender that offers small business loans to micro-enterprises that employ fewer than 10 people and have an annual turnover of less than €2 million.

Microfinance Ireland provides loans ranging from €2,000 to €25,000, without the need for collateral or a long business track record.

You can use these loans for a variety of purposes, including as working capital, to buy stock or to invest in equipment. The application process is more straightforward than traditional bank loans.

Microfinance loans typically have repayment terms of up to five years, with interest rates set at a competitive level (and often lower than high-street banks).

You might also be able to tailor the repayment schedule to match your business's cash flow, which provides some breathing room during the early stages of growth.

To qualify for a microfinance loan, you must have a business plan and be able to show how you'll use the loan to support your business's growth.

While a good credit history can strengthen an application, Microfinance Ireland is known for supporting businesses that traditional banks may have turned down.

Apply now for a Three Ireland grant

Ten eligible small businesses will each receive a €5,000 cash grant and €5,000 worth of Three solutions and products. Check your eligibility now