Ireland has a number of rising business stars currently making an impact across different industries, but what makes them shine and make their mark?
Success in business often hinges on a cohesive and talented team. In the world of sports, this team is usually led by a captain or manager, and in business, this leadership role is often filled by the owner-manager, who may start as the sole member of the team.
The journey from startup to a profitable business with a full complement of employees overcoming significant challenges in a short time is what sets these rising stars apart.
“In Ireland, where the entrepreneurial spirit runs deep, the most successful businesses are consistently led by individuals who are not only deeply passionate about their ventures but also exceptionally adept at understanding their markets and managing their finances,” says Vivian Nathan, Chief Operating Officer at Baker Tilly Ireland.
“These leaders make substantial sacrifices and strategically recruit the right people to drive their missions forward.
“This is particularly evident in the tech sector, which remains a major driver of innovation and economic growth across the country.
“Irish tech entrepreneurs are not merely responding to global demands; they are at the forefront of pioneering new technologies that redefine how businesses operate worldwide.”
A “rising star” might be a second-generation business owner or an enterprising individual who has started their own venture.
Regardless of their stage in the business cycle, these entrepreneurs face a set of common challenges:
Choosing the Right Business Structure –
The predominant structure for Irish businesses is a limited company, which allows owners to mitigate risks and include friends, family, employees, and external funders as shareholders.
Alternatively, Limited Partnerships (LPs) are more suited to the Irish legal and business landscape, offering easier profit distribution and the ability to reinvest earnings within the business, deferring income tax until profits are withdrawn.
However, only limited companies can benefit from R&D tax reliefs and secure tax-efficient investments such as those under the Enterprise Investment Incentive Scheme (EIIS), which are particularly advantageous in the tech sector.
Additionally, individuals investing in corporate trades through limited companies can also avail of tax relief under the Start-Up Relief for Entrepreneurs (SURE) scheme, further incentivising investment in start-ups and small businesses.
Access to Finance –
Growth stages often prompt business owners to weigh the options of equity financing against potential ownership dilution or debt financing.
Combining both may provide optimal results.
Qualifying for investor tax breaks under schemes like EIIS can significantly broaden access to funding sources, including crowd funders, helping entrepreneurs to secure a “smaller slice of a bigger pie.”
This is especially vital for tech startups that require substantial initial investments to bring innovative products to market.
Mentorship and Guidance –
Consulting with mentors, whether they are fellow business owners, external advisors, or accountants, can provide crucial insights and solutions to challenges faced by the business.
In the tech industry, where rapid changes are the norm, having an experienced mentor can be particularly beneficial.
Support for such mentorship can be found through resources such as Enterprise Ireland and Local Enterprise Offices, which play a pivotal role in guiding entrepreneurs. Entrepreneur hubs, like the National Enterprise Hub, Dogpatch Labs in Dublin’s Digital Docklands, Cork University Business School, and the IGNITE Programme at UCC, also offer valuable support networks and resources for budding entrepreneurs.
Recruiting, Rewarding, and Retaining Talent –
Today, potential employees value work-life balance and benefits such as a four-day workweek just as much as salary.
The availability of a Work From Home (WFH) allowance has also become an attractive perk, reflecting the increasing importance of flexible working arrangements.
Establishing a management team and workforce that shares in the business’s success through tax-efficient share incentive plans, such as the Key Employee Engagement Programme (KEEP), and cash bonuses is essential.
In the competitive tech sector, attracting and retaining top talent is crucial for sustaining innovation and growth.
Offering these benefits enhances employee satisfaction and strengthens the company’s ability to compete in a dynamic market.
Exit Planning – Ambitious rising stars in Ireland are not merely running “lifestyle” businesses; they are constantly pushing boundaries with an eye towards eventual sale.
Effective exit planning involves maintaining clean financial records and being prepared for due diligence at any time.
To further incentivise this, the Revised Entrepreneur Relief provides a significant advantage, offering a reduced Capital Gains Tax (CGT) rate of 10% on gains from the disposal of qualifying business assets, down from the normal rate of 33%.
This relief makes strategic exit planning even more rewarding for entrepreneurs looking to capitalise on the value they’ve built in their businesses.
Invest in Tax Planning Amidst Economic Uncertainty—
As we navigate through this uncertain phase with a looming October budget and upcoming elections, all signs point towards a taxpayer-friendly outcome.
With significant corporation tax receipts that have not been increased in five years despite rising inflation and property values, there is a strong expectation of favourable changes.
This environment may provide a prime opportunity for business owners in the tech sector to reevaluate how they remunerate themselves, consider adjustments to their business structures, and perhaps accelerate their exit strategies.
Nathan explains that a proactive approach to business challenges defines what makes Ireland’s rising stars exceptional.
“These innovators are not merely surviving in a competitive landscape but thriving, actively propelling Ireland’s reputation as a leading hub of innovation and entrepreneurial excellence.
“Their successes extend beyond the local market, influencing the global tech industry and other sectors significantly.”
“Their ability to anticipate and adapt to challenges not only sets them apart but also drives forward the nation’s status as a beacon of innovative solutions and business prowess.”