Leo Clancy is well used to big jobs announcements. In his former role heading up the ICT sector for IDA, he had a hand in most of the big ones from Apple, Google, Facebook and others.
ow, as the new CEO of Enterprise Ireland since the end of May, he is focused on celebrating homegrown success.
So when Limerick engineering contractor Kirby Group announced 300 jobs in July he eagerly attended the press announcement alongside the Taoiseach.
But he quickly noticed a difference to the big tech gigs he regularly attended over the previous eight years: “The media were there but probably not in the numbers you’d have seen with equivalently sized IDA announcements,” he says.
There is a tendency in Ireland, he says, to take local success for granted and to celebrate success that comes from
overseas a little bit more.
“There’s nearly €30bn spent by Irish exporting enterprises in every part of this State. We have to work out how we can make that story resonate a bit more.”
After taking over in the hot seat at Enterprise Ireland from Julie Sinnamon, Clancy’s first task was to begin developing a new strategy to take the organisation through to 2030 — to be launched early next year: “With our new strategy launch, we’re going to be able to bring a bit more oomph.”
At the IDA, Clancy dealt with the world’s biggest tech firms, talking routinely in billions of dollars. Now he deals with exporters in every corner of Ireland, where every euro is hard earned.
“I saw that rocketship growth that we had in tech, which has been brilliant for Ireland. But this is a very exciting time to take on this role because I think there’s massive potential for Irish enterprise and it’s going to be a really exciting ride now over the next five or 10 years.”
It is, however, a particularly volatile moment for Irish exporters. Covid and Brexit have combined to whisk up a heady cocktail of lockdowns, customs confusion, logistical logjams, staff shortages and a looming threat of inflation.
Clancy will have heard back these concerns — and more — last week as part of the agency’s International Markets Week, which saw 700 companies meet with its advisers across 40 overseas offices. But he is eager to focus on the positives. More than half of Enterprise Ireland clients have increased exports this year compared to 2020, according to a survey it has undertaken.
“There’s a risk in dwelling on the challenges that people shrink back too far. Companies all over the world are taking advantage of the upswing in the global economy and scarce product demands. The flip side of deglobalisation and logistics challenges is that Europe is looking to localise supply chains a lot more. We’re underdone in terms of market share in the eurozone. It’s a massive opportunity right on our doorstep.”
There has been real progress. In 2010 Irish firms exported €2.85bn worth of goods into the eurozone; it’s now at €5.85bn, more than double. By comparison, exports to the UK, hit by Brexit uncertainty and complications, rose to €7.5bn currently from €5.6bn in 2010.
Clancy declines to comment on the tensions in the British-Irish relationship.
“There are risks. But Irish exporters have worked really hard to deal with them. Enterprise Ireland, to its credit, has been absolutely at the centre of that but I can’t claim any credit for this because it all happened before my time,” he says.
Last month he travelled on a UK trade mission, holding round table discussions on sectors such as health, insurance, technology, housing and construction.
“We met a new e-scooter product firm that had won contracts in different boroughs around the UK. Those are the kind of markets that people overlook when they wring their hands about Brexit. There’s a massive opportunity in the UK and the UK is undergoing a massive transformation.
“The danger in the narrative right now is that we turn people off the market when actually we are uniquely positioned in terms of our Common Travel Area and our EU membership. We should be making the most of that.”
Clancy cites various examples of growing Irish success stories on the wider global stage, such as Fenergo, Let’s Get Checked and Workhuman, not to mention Donegal-based E&I Engineering, which sold last month for close to €1.7bn.
But he agrees that life in a small business is often a tough slog: “I’m really appreciating these last few months how tough the entrepreneurial life is for people. Everyone looks at the story of the person who made €100m or €50m. But for every one of those people, I’ve seen lots of people who are paying themselves tiny salaries compared to what they could have made if they’d stayed in their job or who are taking risks with their home.”
When people put time and effort into building a company they need to see a return, he says. “A deal can come along at the right time that just makes sense and helps them achieve that personal outcome. But what we would like to see more of is that in such scenarios the company stays Irish, the founders stay involved, they get to take some money off the table, they get to pay off their mortgage and put money away for their kid’s college and they also get to stick with the company and grow it further. There are still not enough sources of this type of capital,” he says.
“Someone said to me in the process of interviewing for this job: ‘you need to have empathy for entrepreneurs’. And it’s only the last few months that I’ve really internalised what that means.”
He readily admits that he has never been an entrepreneur but he has seen the vagaries of life on the edge in the private sector.
From a Tipperary farming background, he studied to become an engineer. He started his career in the steady ship that is Swedish networks giant Ericsson but gave that up to become employee number 32 at then new telecoms firm ENet.
“I gave my notice to Ericsson, which was a solid job of 13 years, on the day Lehman Brothers collapsed in September 2008. My first month at ENet was the first month the company hadn’t taken an order in its history.”
After a number of years with ENet’s senior management team, an opportunity came up to become IDA’s head of ICT sector in 2013.
“All of the announcements by Apple, Amazon, Facebook, Microsoft, Intel, Google were all one way or another in my portfolio. A huge amount of investment went in over that period from 2013 to 2020. I think that’s the point where we pivoted from being a foreign direct investment player to being a tech capital of Europe. It really crystallised over that time.
“We went from 2013 where we worked very hard to get small numbers to 2018 where Dublin was always on the list for these companies, even if we weren’t guaranteed to win the investment.”
He does not buy into the idea that the Government’s recent concession that it will sign up to a global minimum corporate tax rate suggests that Ireland needs to reinvent its economic model.
“I don’t think we need to reinvent any model. I think, in fact, we’ve already reinvented ourselves. That is the bit that’s often missed in this conversation. We did diversify from maybe a reliance on tax that had been heavier in 2013, to more skills, more diversified regulatory options such as data protection and a massive increase in R&D.
“And I do think that this dialogue at the moment of forecasting the death of FDI as a consequence of the new agreement is definitely overstated.”
Of course, FDI is no longer Clancy’s real concern and he tactfully steers the conversation back to the importance of Ireland’s indigenous export sector to every region in Ireland.
“Sixty-five percent of jobs supported by Enterprise Ireland are outside the Dublin area and it is a huge contributor to rural and regional economies,” he says.
Indeed, many small Irish companies benefit from minority stake investments by Enterprise Ireland that make the state agency, by deal volume at least, a major venture capital player.
“By deal count, Enterprise Ireland is number one in the world in terms of venture capital investments. We are not the biggest investor by any stretch but we’re certainly trying to participate in as many equity investments as possible in order to help as many companies in Ireland as we can.”
Clancy says that there is room for the organisation to start shouting louder about this story to show how its venture capital investment ties in with future economic growth. Last week’s Budget further underlined this with the Enterprise Ireland administered innovation equity fund boosted from €30m to up to €90m to support predominantly seed stage Irish SMEs, particularly in areas such as female entrepreneurship, climate change initiatives and regional developments.
“There’s a need for early stage capital to bootstrap early operations and we’re seeing huge appetite for that kind of money from funds.”
Risk, of course, does not always come naturally to state agencies. Clancy agrees that a cautious approach is inherent in the state sector but says it is part of Enterprise Ireland’s remit to take some risk.
“You never get plaudits in the state sector for losing money or for making the wrong investment decision. But you have to take some risk. If you’re not taking risks then you’re not investing in early stage companies. What we have is a really good process. When we sign off on these kinds of deals. The discussion is very rigorous.”
Every aspect of an investment is examined, from potential state aid issues, to value for money, to potential returns and the other investors involved.
“But we still know that in certain cases, there’s going to be risk. None of us has a crystal ball. You can’t tell where a company’s going to land in two or three years but we try to manage the risk.”
But, he says, a far greater risk for the Irish economy would be “if we do nothing or that we only take decisions that are sure bets.”
