In the summer of 2021, AIB appointed a receiver over all shares legally and beneficially owned by the entrepreneur Barry Napier in six companies including his shareholding in Cubic Telecom. 

The bank was pursuing a loan of €1 million that appears to have been incurred when an investment in a pub, restaurant and guesthouse in Napier’s hometown of Enniskerry failed to take off. 

AIB made its move when Cubic was at a low point, despite the brilliance of its technology. The Irish maker of automotive software technology makes its money from data required or generated from cars as they move around. 

With cars restricted in their movements during the pandemic’s lockdowns, Cubic saw its revenues plunge dramatically in 2020, and they were still down in 2021. 

A million euro is not a small amount of money, but the move by the bank to pursue so publicly the chief executive of one of Ireland’s best technology companies raised eyebrows. 

We don’t know all the details of what occurred, but it took until Christmas 2022 for a judge to end the receivership.

It is richly ironic that after one arm of AIB made such a move, another arm of the bank — its equity team — is now one of the biggest winners from the news this week that Softbank is acquiring 51 per cent of Cubic for €473 million.

This investment values Cubic at €927 million or $1.002 billion, making it one of the most valuable technology companies in Ireland. 

So how has AIB ended up such a big winner?

In 2011, after the Irish state recapitalised AIB at a cost of tens of billions, one of the things the bank was tasked with doing was investing more in Irish business. 

It invested €15 million in a fund called the AIB Start-up Accelerator Fund managed by experienced investors Act Venture Capital. 

In the second quarter of 2013, Act put €650,000 from this fund to work by investing in Cubic Telecom, which then had revenues of under €2 million. 

Ten years later, this seed fund has made a circa 20 times return on its stake in Cubic, with the vast majority of this money going to AIB.

The very bank, which only two years ago was pursuing the founder of Cubic for €1 million, is now firmly in clover.

What of the other Irish investors in Cubic? Irish venture capital fund Act has certainly been a steadfast and valued investor in Cubic for ten years.

Besides backing the business at the beginning, Act invested in Cubic using three different funds over the years.

Notably, it invested €11 million in Cubic in 2019 at a valuation of around €140 million. Cubic had raised money two years earlier at a similar valuation in a $40 million raise.

This made ACT one of the biggest external investors in the business along with the Volkswagen Group, chip-maker Qualcomm and the state’s investment vehicle Isif.

Act is a deserved winner as it believed in Cubic from start-up minnow to technology unicorn. 

Isif has also done well. Roughly, it looks like it made a six-time return over a five-year period. Plus it helped support an important Irish business, which is part of its core mission.

Another winner in Cubic is its staff. Napier and his equally talented COO Shane Sorohan put an ESOT in place for staff a number of years ago.

About 190 people are in this ESOT, which is thought to control somewhere around 10 per cent of the company.

Napier’s own stake is held through a company called BPI Telecom Ltd. As my colleague Sean Keyes calculated, BPI Telecom’s stake is worth over €300 million.

Napier owns 80 per cent of BPI, so his position is worth about €250 million. Barry Higginbotham, a long-term business partner of Napier, who controls the other 20 per cent of BPI has also done really well.

Napier is staying with Cubic, and he will remain a significant shareholder. He is thought to be planning to take over €100 million off the table from the sale, but has no plans to quit.

Napier instead wants to scale Cubic even more with the firepower of SoftBank, along with Sorohan and their broader team, to become an even more global business.

Napier is at the start of his next journey and deserves everything he gets for being brave enough to back himself and Cubic.