He spent the next 10 years in America, building expertise in the telecommunications industry, before spotting a use for the fibreoptic technology in which he specialised, in the fast-growing sphere of biomedical devices. Having had his eureka moment, he did what bright young expatriates are increasingly doing in the “noughties” — he returned home to set up in business.
“I always had an idea that I wanted to do something for myself, and I saw an opening for some telecommunications technologies to be adapted for the biomedical sector,” said O’Connell.
One of his first ports of call on returning was Enterprise Ireland.ie, whose enterprise preparation programme helped him develop a business plan, as well as providing him with business incubation space to establish his company, Solas Technology.
“A large part of the decision to base the company here was a lifestyle choice, I simply wanted to come home, but Enterprise Ireland’s support made it easier,” he said.
Life in Ireland, particularly the high cost of living, has taken some adapting to. “It has been a learning process and, having been away, you have to guard against having an idealised picture of how things will be back home,” he said.
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“That said, I was pleasantly surprised at the lack of red tape involved and at the level of support structures available for neophytes like myself who had never set up a business before. Having looked at the kind of enterprise supports available in America and, through friends, in the UK, I believe they are second to none here.”
Enterprise Ireland is particularly focused on Irish professionals living abroad at the moment, and is keen to bring their expertise back home.
“We are actively targeting Irish people overseas,” said Kevin Sherry, the head of Enterprise Ireland’s High Potential Start Up unit.
The figures back this up. In 2003 Irish expats accounted for 5% of EI-supported start-ups. By last year that figure had more than doubled to 11%.
“My ambition is to get that figure up to 20% within five years,” said Sherry. “This is because professionals from overseas bring with them not just the expertise they have built up in their particular field, but experience of operating in international markets.”
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Encouraging them home is made easier by the fact that Ireland is a business-friendly environment.
“Ireland is a very attractive location right now, ranked by the Global Entrepreneurship Monitor as one of best places in the world to set up business,” said Sherry.
Significant funding activity in areas such as life sciences and biotechnology, as well as in information and communications technologies (ICT) combine with “a strong pro- business approach from government, of which not least is the tax environment,” he said.
Favourable tax treatment of patents and royalties is a another significant factor, particularly as so much incipient industry is research-based.
“There is also the simple fact that Ireland is English-speaking and in a suitable time zone, factors people often underestimate the importance of,” he said.
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Angela Kennedy was one of the first of the current crop of entrepreneurial diaspora to return to Ireland.
The Tipperary woman spent eight years in Sydney, Australia, where she set up a biotech company, Megazyme, with her husband, before returning to Ireland in 1996.
“Most of our customers were in Europe and, because of the time-zone difference, we seemed to be always jet-lagged at trade shows, losing more time travelling than others, and taking longer to recover afterwards,” she explained.
“We also had two children and I wanted to raise them in Ireland, where the education system is second to none.”
Low corporation tax was also a factor. “We were paying 34% at the time, which was crippling for a start-up. We knew the lower corporation tax in Ireland meant we would be able to plough money back into growing the company.”
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The move was not without its challenges. “We arrived just as the dotcom hype was growing, which gave people a false perception of their value and worth,” she said.
“After six months here I thought it would never work, we would never be able to build a culture or an enterprise.”
Though she has a “great team” now, as a small biotech company, competition for highly qualified science staff remains a problem. Megazyme is based in Bray, Co Wicklow.
“You are competing with the big pharma-companies and they take the cream,” she said.
“To anyone thinking of returning home to set up in business, my advice would be to think about setting up outside Dublin. The land and building costs in the capital can increase your start-up costs four times.
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“The other benefit is that you will find access to key staff is better, and loyalty from staff flows from that.”
The capital still represents a huge draw. John McHugh set up Brandvis in Dublin three months ago to design, develop and supply high visibility workwear using specially developed software that allows buyers to customise garments.
For the past five years McHugh lived in China where he specialised in software outsourcing. As part of his business model, Brandvis employs a manufacturing team in China.
“I saw an opportunity for workware software, because of my background in software,” said McHugh. “So I got in touch with Enterprise Ireland, came back to Ireland and put together a demo version.”
Enterprise Ireland took a 7.5% equity stake in the company and provided employment grants and supports in a total package McHugh reckons is worth about €150,000.
“The hardest investor you ever have to find is the first, so it was enormously helpful to have EI sign up first,” he said.
He believes entrepreneurs returning to Ireland to set up in business should consider the strengths the country has to offer their business.
“It’s great to come back to Ireland to set up, but you have to think globally in terms of where your inputs come from,” he said. “For me, Ireland is strong on the software, logistics and management side, while China is strong on manufacturing.
“You have to think globally to be competitive, and with advances in IT and communications technology, it’s not nearly as scary as you think. Even the price of flights has come down.
“By all means make a base in Ireland, but take your inputs from where they can add most value.”
OVERSEAS NETWORKS TARGET ENTREPRENEURS
IN ORDER to find suitably entrepreneurial candidates, Enterprise Ireland (EI) has set up a series of membership networks for Irish professionals working overseas. Its Young Irish Professional Network in Britain has 1,200 members.
The agency uses these to hold networking evenings and make regular presentations about the supports that are available to start-ups back home.
“Through these networks we have built up a strong pipeline of people looking to come back and set up in Ireland,” said Kevin Sherry, the head of EI’s High Potential Start Up unit.
The first step for anybody thinking of making the move is to talk through their idea with EI representatives overseas.
From there, the agency develops a “look see” itinerary for them, bringing them home to meet entrepreneurs who have made the leap, people working in their field and potential investors.
“Once people make that trip we have a very high conversion rate,” said Sherry. “From there we work with them to bring their plans to fruition and, because we support teams, not individuals, we help them build out their team, and to put funding in place.
“From our perspective, expats are also typically keen to locate outside of Dublin, which suits our overall strategy. What’s more, because these people have lived overseas, they are not just export oriented, they really know their markets.”
For more information on Enterprise Ireland’s support programmes for High Potential Start Ups see www.enterprise-ireland.com.