Close to 20 years ago, I made my way to a run-down office on Middle Abbey Street in Dublin 1 to meet Dylan Collins.  

Just months out of college, Collins was already on his second business – he had already sold his college enterprise, a web-based texting company called Phorest. The second business, Demonware, was developing software to power games for the XBox and PlayStation platform. 

At the time, the company was just Collins and his business partner Sean Blanchfield. However, I remember being struck by the vision that Collins had for both his own business and for the wider video games industry in Ireland. 

By 2007, the company was sold for a reported $17 million to Activision, a massive turnaround in such a short space of time in such a competitive industry. Collins has since gone on to found, scale, and sell a number of other businesses, most recently SuperAwesome, a kidtech platform that helps content creators such as film and television companies comply with emerging laws around child online privacy and advertising to minors.

However, the genesis of his success is the gaming industry. At the time, Collins believed that Ireland could become an international hub for games studios and developers. 

In the years that followed, the sector has increased in both size and scope. After years of lobbying and manoeuvring, the industry secured its own tax credit, modelled on the Section 481 tax relief for the film and television industry. 

By most metrics, the sector in Ireland remains relatively small. And, in recent times, there have been redundancies in the sector here. However, it remains rooted in indigenous companies. It is an industry that wants to grow and expand and make an economic contribution.

Last week, I attended the Nexus by Gamerfest Conference, which was devoted to the gaming industry in Ireland. Speakers such as video gaming legend John Romero, Digit Games co-founder Richard Barnwell and WarDucks founder Nikki Lannen spoke eloquently about the challenges and opportunities facing the industry. 

It was an honest appraisal of where the sector is in Ireland, and the potential roadblocks, specifically funding, that could hinder its ability to get to the next level. 

Overall, however, the mood was optimistic. Given everything that is going on in the world at present, Ireland needs to back more sectors like gaming to develop a more robust indigenous economy.

Ireland’s current economic model of seducing foreign direct investment through sympathetic tax policies is coming under increasing strain. Ireland’s model is based around globalisation and multilateralism. However, more and more countries are pushing in a more insular and protectionist direction.  

The tech sector is facing significant challenges, while, in the coming months, the new minimum corporation tax rates will come into force – although as the celebrated economist Gabriel Zucman outlines in a major interview with Thomas tomorrow, there remains a cohort of countries that want the new 15 per cent rate to increase further still.

We are already seeing the effects of this new global paradigm. Take last week, for example. Microsoft’s LinkedIn said it was cutting about 668 roles across its engineering, product, talent and finance teams, the second such cuts this year as fewer companies use the hiring platform and corporate social network. A small number of Irish employees will be impacted.

Of more concern is Nestlé’s decision to close its Wyeth Nutrition plant in Askeaton, Co Limerick and the likely loss of 542 jobs. The Swiss group said that it would likely cease operations at the plant in the first quarter of 2026, a decision it said related to falling demand for imported infant formula in China.

Thomas did a deep dive into the decision last week, and it is well worth reading as it covers everything from dairy expansion to geopolitics, and from technology to tax. As Thomas outlined, changes to corporate and tax structures meant the plant’s operational margin fell from over 50 per cent in 2016 to 3.6 per cent the following year and has remained in single-digit territory ever since.

“From a central value-added centre, Askeaton had turned into a mere manufacturing cog in Nestlé’s global supply chain,” Thomas wrote. “All the while, its export market had increasingly focused on China. Lately, its entire production has been shipped to Asia and Greater China, a Nestlé spokeswoman told me.

“Yet after encouraging infant formula imports 15 years ago to guarantee a safe supply and reassure their population, the Chinese authorities turned their attention to rebuilding their domestic industry. This policy has accelerated amid trade tensions with the West in recent years and under the nationalistic government of President Xi Jinping.”

This is the world Ireland is now operating in, and it will require innovative thinking. In many sectors, it will be about reinventing and recalibrating what we are already good at. Ian Nelson, KPMG’s head of financial services, told me last week about how Ireland needs to create an “IFSC 2.0” to remain at the top table of global finance. 

The government is not unaware of all of this. The business focus of Budget 2024 was geared more towards indigenous business as opposed to multinationals. There was a new €250 million Cost of Business Scheme, a one-off initiative that will benefit 130,000 small and medium businesses that are struggling with rising inflation and heightened costs. A new Angel Investment Scheme, offering investors a reduced capital gains tax of 16 per cent for gains of up to €3 million, was also unveiled. 

The Enterprise Investment and Incentive Scheme (EIIS) and the Keep scheme for share options, two schemes maligned within Ireland’s start-up and scale-up community, are to be simplified and enhanced. These are things that the business lobby here have been seeking for years. Now, finally, they are being delivered. 

The Irish economy is nearing an inflection point. Multinational corporate tax receipts can no longer be taken for granted, and we need to develop new revenue streams. Like the gaming sector, we need to pick areas in which we can win – and then back them.

*****

This weekend, some 24 Irish start-ups and SMEs from across industries gathered in Ballymaloe to hone their businesses alongside some of Ireland’s most established entrepreneurs as part of The Entrepreneur Experience. Jonathan profiled the 24 companies participating. We wish each of them well.

What do you do when you have built, and successfully exited, a global company? For David Walsh, cofounder of Netwatch, the answer was to do it again. At a recent event organised by Rockwell and The Currency, he offered advice on how to scale up, sell up and start up again.

As the head of the SEAI, William Walsh is tasked with taking the energy transition inside some of Ireland’s hardest places to reach: homes and SMEs. He discussed the challenges facing the fast-growing state agency with Stephen Kinsella – read or listen to the interview.

Sitting at 35,000 ft in seat 2A, Sinead O’Sullivan reflected on some of the reasons that Ryanair is so successful, and why Professor Michael Porter still insists Ryanair be included on the Strategy syllabus. “In a strange way as I sit on this flight and look around, I feel that we are quite like a busload of Michael O’Leary disciples, travelling far and wide to spread the Ryanair Gospel on behalf of our heavenly CEO. He needs us as much as we need him,” she writes.