Irish Start-ups Face Funding Crisis as Three-Quarters Struggle to Attract Capital
Three-quarters of Irish start-up founders describe attracting private capital as difficult or very difficult, according to a new survey, with funding remaining the single biggest obstacle for the fifth consecutive year despite Ireland's booming technology sector.
The 2026 State of Start-ups survey from Scale Ireland, published this week, paints a challenging picture for early-stage companies in Ireland. Despite the significant growth and investment seen in the broader technology sector, founders continue to struggle to secure the capital they need to scale their businesses.
Key Findings
The survey found that 75% of founders described the process of attracting private capital as either "difficult" or "very difficult" — a figure that has remained stubbornly high for five consecutive years. This persistent funding gap highlights a critical vulnerability in Ireland's start-up ecosystem, even as the country attracts major multinational investment in AI and technology.
The survey also unearthed a concerning lack of awareness regarding upcoming regulations. A significant 35.4% of founders reported being unaware of the landmark EU AI Act, and a similar number — around 36% — admitted they did not know how the comprehensive new law could impact their business operations. This suggests an urgent need for education and support to help Irish start-ups navigate the evolving regulatory landscape.
Regulatory Challenges
The EU AI Act, which came into force in 2024 and is being phased in over several years, will impose significant obligations on companies developing and deploying AI systems. For start-ups building AI-powered products, understanding and complying with the Act will be essential — yet the Scale Ireland survey suggests many founders are not yet aware of its implications.
Industry bodies and government agencies are being called upon to provide clearer guidance and support for start-ups navigating the new regulatory environment. For more, see Silicon Republic's coverage.
What's Next?
Scale Ireland is calling on the government to take concrete steps to address the funding gap, including measures to encourage more domestic institutional investment in early-stage companies and to improve the tax environment for angel investors. The organisation argues that without action, Ireland risks losing promising start-ups to other jurisdictions with more supportive funding environments.
