In the increasingly complicated world of investment promotion, Connect Ireland, a private company supported by the Irish government, has launched a strikingly simple idea. In March 2012, it announced a scheme to award referral fees of up to $2000 per job created to anyone who can put Connect Ireland in touch with potential investors.
“The initiative is open to everyone, so whoever knows people willing to set up businesses in Europe and passes that information to us, can get a reward,” Terry Clune, Connect Ireland's founder, told fDi Magazine shortly after the programme was launched.
Army of individuals
More than 8000 'connectors' have taken up Mr Clune's offer and passed on more than 900 leads to Connect Ireland in the 18 months since the initiative was launched. But, as impressive as these numbers might sound, only nine of these leads have so far been turned into investments. Has the initiative been a failure then? Far from it. “We are in intensive discussions with 50 companies and we have 1500 jobs in the pipeline,” says Michael McLoughlin, CEO of Connect Ireland.
Connect Ireland works on a daily basis with Ireland's Industrial Development Agency (IDA), the country's economic development entity, to ensure that it only approaches investors that have not been contacted previously by IDA. Mr McLoughlin estimates that, for that reason, Connect Ireland has had to drop nearly one-quarter of the leads that it has received.
“We are after incremental opportunities, and from that perspective, 240 jobs that resulted from the scheme would possibly not end up in Ireland otherwise,” says Mr McLoughlin. Moreover, the activity of Connect Ireland and its staff of 28 is not funded by the state and the company receives fees from the Irish government (of up to $3300 per job created) only when investors settle in Ireland.
Moreover, unlike investment promotion agencies (IPAs), which usually rely on professional economic developers, Connect Ireland aims to receive leads from individuals who do not necessarily chase FDI on a daily basis. “We just tell people: ask your friends, look around and pass the information to us and we will take it from there,” says Mr McLoughlin.
Thanks to this approach, Ireland is gaining a growing base of ad hoc economic developers, in places that would not be tapped by IPAs otherwise. “We receive a lot of leads from Indian and Chinese individuals who graduated from Irish universities. And one of the strongest leads that we received came from a lady that works as a personal assistant in a company looking for expansion overseas,” says Mr McLoughlin.
Reaping the rewards
Thanks to Connect Ireland, keeping eyes and ears open on behalf of Ireland can pay off handsomely, as the case of Hugh Morris, the most recent beneficiary of the scheme, shows. In late 2012, while at a party in England, Mr Morris, an auctioneer from Kells, a town 65 kilometres north-west of Dublin, found himself talking to Brian Dougan, director of Mafic, a Luxembourg-based basalt fibre producer.
“I asked him whether he would consider Ireland, and then whether he would consider Kells,” says Mr Morris. Following their conversation, Mr Dougan did look at the investment opportunities in Ireland and, as a result, Mafic will not only create 70 jobs in Kells, but Mr Morris has also picked up a $140,000 reward from Connect Ireland.
“Talking can take you a long way. It is as simple as that,” says Mr Morris, adding that he is currently on the lookout for even more FDI deals for Kells.