Dáil Éireann Debate, Tuesday - 3 December 2019
46. Deputy Éamon Ó Cuív asked the Minister for Business, Enterprise and Innovation the changes in policy that are proposed to ensure the accelerated growth of the indigenous high-tech industrial sector; and if she will make a statement on the matter. [49685/19]
View answerI think we have to look to the future. Questions Nos. 46 and 47 are basically related. I know they are being taken separately. I have tabled Question No. 46 to ascertain what is being done to ensure the indigenous high-tech sector continues to grow. We have to make a big effort to ensure the indigenous high-tech industrial sector grows in the years to come.
I thank the Deputy for raising this matter. He is absolutely right when he says that we always have to look to the future. That is why the Taoiseach and I launched the Future Jobs Ireland initiative earlier this year. The initiative positions Irish enterprise and Irish workers for the world of tomorrow. The pace of change means that the world of tomorrow is coming down the tracks at us very quickly. The indigenous high-tech industrial sector is a key sector of focus for Enterprise Ireland. In line with its Build Scale, Expand Reach strategy, which runs from 2017 to 2020, Enterprise Ireland is helping companies in the high-tech industrial sector to start, innovate and remain competitive in international markets now and into the future. To support the accelerated growth of start-ups in this area, Enterprise Ireland's high-potential start-ups division provides financial and non-financial support to innovative start-ups that have the potential to develop an innovative product or service for sale in international markets, as well as the potential to create a minimum of ten jobs and €1 million in sales within three years of starting up. This support includes equity funding of up to €250,000, which Enterprise Ireland invests in partnership with other investors in an investment round.
Other supports include innovation vouchers, mentors and capability building programmes such as excel at selling and investor-ready training.
To support established companies in this sector with accelerated growth, Enterprise Ireland engages with client companies through its teams of sectoral focused development advisers using a company-led diagnostic approach, which is used to establish clients' business needs. The agency can then tailor a support package to the company's growth potential based on its ambition, capability and need. A support package focuses, where relevant, on six business pillars, namely, innovation, finance, operations, sales and marketing, people and organisational development.
Support to client companies is awarded based on an agreed business plan. Enterprise Ireland supports focus on innovation to enable companies to develop new market opportunities and maximise their business performance; competitiveness to identify and measure issues for clients; and internationalisation to assist companies tackle the main challenges of breaking into new markets.
Does the Minister accept that in the past the reason for foreign direct investment was that such companies had the technical know-how and money and that in our early industrial history we did not even have the educational back-up? Does she also accept that in terms of education our graduates, working both at home and abroad, are as good as any in the world and that many of them have experience working in the high-tech sector? To get industries up and running we need money and we need to attract and encourage our graduates to develop these industries. The Minister referred to investment of €250,000. If she had experience in the financial world, she would know that in industrial terms €250,000 is a small amount. What steps are being taken to ensure that there will be adequate, real finance available to start-ups, incubation business in, for example, the universities and people who have already worked in the high-tech sector, to take them to viable status? The sum of €250,000 is too small an amount in terms of investment to get them to that stage.
The €250,000 is for the high potential start-up units. It is just one of a range of supports available to businesses. I refer the Deputy to the document, Overview of Government Supports for Indigenous Businesses, which is available on my Department's website. It is a useful document, which outlines all of the supports that are available to help companies to scale up, invest in research and innovation and improve their management capabilities. The OECD review of our indigenous sector published last month contains a number of suggestions that I will act on as part of the SME strategy. We want to target a 50% increase in the number of SMEs exporting through the expansion of programmes and the development of export capable firms. We also want to broaden the policy focus at the local enterprise offices, which are doing wonderful work with companies, to enable them to work with more companies and increase the adoption of best practice management techniques, including in the key challenge areas of digital and automation skills, sales, marketing and accountancy. We also want to encourage a wider take-up of Skillnet Ireland programmes to develop management capabilities in the Irish SME sector. I also want start-ups to step up their financial skills. Research has shown that while many of our businesses are really good, they are not capable of making good propositions to banks to secure funding. Rather than always looking to traditional lending, they need to look at equity and a range of financial instruments that they can use to invest in their business.
In regard to our young people, I go abroad on trade missions with pride. We have one of the best educated workforces in the world such that when foreign direct investment is coming to this country we can point to our young, highly educated and agile workforce. Also, as a committed member of the European Union, we have access to a huge market. There are many positives.
I accept that there are many positives but we have to look every day at where the challenges and opportunities are. On the opportunity side, there are many people at home and abroad working in multinational companies who already have much of the experience the Minister speaks about, which they have earned. They worked their way through the education system and then went to work in industry and so on. What programmes are in place to encourage these people to leave their comfort zone and get involved in setting up and growing industries of their own?
The second part of my question was about incubation companies that come out of the universities. In many places around the world where industry has developed in modern times, it came out of education establishments. How does the Minister propose to ensure that people have access to the risk funds that are necessary to bring incubations onto the market? The Western Development Commission was very successful in taking a punt and had more winners than losers. What does the Minister propose to do to ensure there is a steady flow of cash? There will be some losers and some winners, but there will be more winners than losers.
We have some really good Irish companies. We are working with the SMEs on how to work collaboratively with foreign direct investment to leverage some of their talent, skills and experience. When both work together the results are better. Under the disruptive technologies innovation fund, another tranche of which I will be announcing soon, one of the qualifying criteria is the involvement of an SME. This is about disruptive technologies coming on stream into the future and collaboration in that regard between the universities, the foreign direct investment sector and indigenous companies. We have many innovation hubs in our universities. Enterprise Ireland is one of the largest investors in the world in terms of venture capital and one of the largest in Europe. We support our companies through Enterprise Ireland.
