Big Read

Is the party over? Irish tech braces for a shock as the easy money dries up

For years, cash flowed freely and plentifully through the veins of this country’s tech industry, but with a potential global recession looming on the horizon, venture capitalists are ordering companies to tighten their belts and slash their costs. Can the sector avoid a full-blown crash?

Most companies that have raised funds recently are now being advised to “lengthen their runway”, which in investor speak essentially outlines how many months a business can keep operating before it runs out of money.

Finn Murphy doesn’t mince his words when he describes the changes that have occurred in the tech sector recently. “We were all smoking crack, and now we’re looking at the person who’s addicted, going: ‘What a moron’.”

That’s how Murphy, a partner at Dublin-based Frontline Ventures, described the attitudes of some VCs, or venture capitalists, towards company founders.

Until very recently, most financiers were actively encouraging founders to spend freely, but that has all changed, ...