DRIVING FUTURE ECONOMIC GROWTH

Almost 80 new export focused high potential companies will contribute significantly to the economy at a time when jobs are increasingly being cut, Linda Pearson reports

Good news for the Irish economy came recently when Minister for Enterprise Trade and Employment, Micheál Martin T.D. announced that Enterprise Ireland had supported the establishment of 76 new export focused high potential companies in 2006. This news comes amidst weeks of bad reports which saw Proctor and Gamble move their skincare product manufacturing to Eastern Europe with the loss of 280 jobs and the Motorola Plant in Mahon in Cork announcing the loss of 330 jobs. These companies are, worryingly, just a small number of many that have announced recent job cuts. The news of the 76 new high potential start-ups (HPSU) is forecast to provide 1,260 new high skilled jobs which will help soften the blow of recent revelations as companies move further afield where business costs are lower.

Minister For Enterprise Trade and Employment Micheal Martin TD	Kevin Sherry, Head of HPSU Division, Micheal Martin TD, Frank Ryan, CEO Enterprise Ireland

CREATING JOBS AND PROFIT

The 76 export focused start-ups, all in knowledge intensive sectors, are expected to grow rapidly and to create over 1,260 new high skilled jobs and generate exports worth €110million over the next two years. Enterprise Ireland invested €17.5million of the total €47.5million investment in the 76 new start-ups.

Making the announcement at Enterprise Ireland’s Annual Start-Up Showcase event, Minister Martin said, “I am delighted to announce 76 new high growth potential firms in Ireland in 2006, the highest number supported by Enterprise Ireland in any year to date. I wish to congratulate the 170 entrepreneurs behind these firms.”

According to Kevin Sherry, Manager of Enterprise Ireland’s High Potential Start-Up Unit, the new firms are, “a strong boost to the economy which will contribute not just this year or next year but over the coming years. We expect that a percentage of those companies will grow into very substantial companies. While 1,260 jobs are important over the next two years we expect that, over time, the companies will create many more jobs than that.”

PUSHING THE ECONOMY FORWARD

Sherry continued saying that the export focused HPSU’s establishing every year is a key driver in pushing our economy forward. “The establishment and growth of internationally scalable Irish companies that are focused on international markets is a key driver of the Irish economy going forward. Because of the size of the Irish market, if a company is to achieve real scale, the majority of them need to build on growing internationally. So what we’re working with here in Enterprise Ireland is hopefully the next generation of multinational companies,” says Sherry.

NNUTURING NEW START-UPS

Enterprise Ireland has worked with the majority of these 76 high potential start-up companies from embryonic concept stage to the stage where in 2006 they were formally recognised as high potential start-up companies.

The Minister for Enterprise Trade and Employment complemented Enterprise Ireland for the work they had put in and their contribution to the growing buoyant economy. “I am very pleased to see a good regional spread among HPSU companies established in 2006. Of the 76 new companies, the majority at 41 are located in regions outside of Dublin, with 35 companies being located in Dublin. I would also like to acknowledge the considerable work undertaken by Enterprise Ireland in supporting these start-ups,” expressed the Minister.

A ‘high potential start up’ is defined as a company which is based on technological innovation and likely to achieve significant growth in three years which corresponds to sales of €1million per annum and employment of ten. These start-ups are usually export oriented and led by an experienced team, with a mixture of technical and commercial competencies, and Minister Martin explains the importance of these companies to the future of our nation.

“These high potential start-up companies are extremely significant to both the regional and national economy. They are expected to create 1,260 jobs and exports worth €110million over the next two years. The start-up companies come from a wide range of knowledge intensive sectors in which innovative Irish companies can develop a sustainable competitive advantage. Hence the 76 HPSU firms created in 2006 have the potential to grow very rapidly,” continued the Minister.

Minister Micheal Martin TD and Joe Scannlon, Managing Director, Lough Allen Foods Ltd	Hyat Syed, CEO of Kohinoor, and Rosemary Sheehan, CEO Broadway Bage

DRIVING FUTURE GROWTH

Developing successful new firms and new business sectors is a key driver of future growth so undoubtedly these new HPSU’s will contribute significantly to the advancement of innovation and competitiveness in Ireland. The development of these new HPSU’s will be eagerly welcomed as employees are facing doubtful times ahead with the trend of large multi-national companies shutting their doors here. The fact that many of these employers are looking to transfer jobs to lower cost economies has caused debates about the rising cost of doing business in Ireland and the need to tackle intensifying competition from Eastern Europe, India and China.

According to Sherry the focus is on stimulating start-up companies which will in turn create job numbers higher than the number of employees losing their jobs at the moment. “Obviously in the short term the job losses are a critical factor for the people and regions concerned. Our focus is to stimulate and increase the number of start-up companies that will, in time, employ many more times the number of people that are unfortunately losing these jobs but that takes time and perseverance.”

DRIVING FUTURE GROWTH

According to the last Global Entrepreneurship Monitor (GEM) Report the climate for entrepreneurship has never been better. The GEM Report found that that Ireland remains one of the leading countries in Europe in terms of entrepreneurship and is fast approaching the levels of early stage entrepreneurial activity prevalent in the United States. Overall, the research found that almost one in ten of the adult population living in Ireland is actively planning or has recently set up a new business.

“One in every nine are either in the process of establishing a new business or are thinking of starting a new business in the immediate future. The pro-business environment in Ireland for start ups is ranked amongst the highest worldwide so it is a very positive environment for entrepreneurs here today,” explained Sherry.

“Increasing the number of new high-growth export focused businesses is a key objective for Enterprise Ireland and 2006 has been a record year with the establishment of 76 HPSUs. Enterprise Ireland is fully committed to working in partnership with these 76 early stage companies to help and support them build their capabilities and secure international market access for their products and services,” concluded Sherry.