Vc Energy Investments
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Vc Energy Investments

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Energy Clean Tech Venture Capital Investments

Energy Clean Tech Venture Capital Investments

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Vc Energy Investments Vc Energy Investments Presentation Transcript

  • Sample of Venture Capital investments in Energy and Clean Tech
  • 372 Energy Investments from 22 VCs
    • Only a sample
      • Not an exhaustive list of VC investments
      • Many large public and private firms in the energy industry are active innovators
      • Energy projects are expensive, and privately funded projects allow startups to innovate without VCs
    • Not a systematic sample
      • Ignores smaller VCs in energy
      • Ignores investments outside a VC’s normal market
  • VC firms sampled The 372 entrants in this sample are (or once were) funded by…
    • 21 Ventures
    • Accel
    • Access Venture Partners
    • Altira
    • Battery Ventures
    • Braemar Energy
    • CMEA
    • Draper Fisher Jurvetson
    • Element Partners
    • Enertech Capital
    • FA Technologies
    • Flagship Ventures
    • Khosla Ventures
    • Mohr Davidow
    • New Enterprise Associates
    • NGEN
    • Nth Power
    • Quercus Trust
    • Rockport Capital Partners
    • Technology Partners
    • US Renewables Group
    • VantagePoint
  • Sources & Generation are targeted more than Efficiency and Conservation
  • Efficiency & Conservation entrants serve fragmented markets
    • All of these segments are in turn easily subsegmented.
    • No “winner take all” subsegments.
    • Doesn’t mean any individual entrant will prove viable.
  • Example: Building Materials New firms have good chance of success but not of dominance
    • Sampled firms in this segment…
    • ARXX green building products
    • Aspen Aerogels nanoporous insulation
    • Calera glass and cement
    • Calstar Products green building products
    • Ecore green building products
    • FreeGreen low energy house plans
    • Greenstone Industrs home insulation
    • Hycrete green building materials
    • Icynene spray foam insulation
    • Microposite green building products
    • PAX Streamline homes
    • Project Frog quick-to-deploy buildings
    • Serious Materials green building products
    • Architects will still choose among new building materials based on color, texture, and methods of application.
    • … but construction markets are still troubled today
  • A Healthy Variety of Supply Segment Entrants
    • A wide variety of supply concepts may be well suited to niche applications that will help them meet their early growth targets.
  • Forecasts Get Surprised !
    • Oil prices are very high
      • speculation against the dollar
      • Chinese Demand
        • May be demand from people who near Bejing
        • May be demand from the same people who brought you the “Chinese Wall” in banking
    • Gas prices are very low
      • Poor economy
      • Unneeded gas released by power generators
  • Impact on Innovation…
    • Price spread for nonpetroleum transportation fuels is much higher, but the winner still takes all.
    • Electricity prices are lower due to low natural gas prices, so high oil prices do not equal high prices for renewable power !
    • Building conservation isn’t so interesting.
    • Alternative vehicles are in today’s sweet spot.
  • Some Segments Appear Crowded
    • Commodity nature of energy can mean “winner takes all.”
    • Most affected are:
    • bioderived fuel photovoltaics
    • solar systems
  • Solar Subsegments
    • Some subsegments will shake out, BUT…
    • Many firms work in more than one subsegment
    • Development firms can change focus
  • Solar --- Some KSFs and Submarkets Stand alone Grid connected Installed cost Reliability Systems integrators OEM Consumer Fabricated cost Ease of installation Modules and concentrators PV converter type Application? Cost/unit yield Life cycle performance Performance enhancement (Multiple markets) (Multiple factors) Other Disposables DIY installations Low cost/area Thin films Spacecraft, etc Concentrator cells Power/weight ratio Watts/area Single crystal silicon
  • Biofuel Subsegments
    • Most efficient technologies should displace others, BUT
    • Performance in adverse weather may create segments
  • Furthermore
    • A large chunk of cost in a biofuel segment is feedstock gathering and transport
    • Each installed facility should dominate its local market
    • Since physical processing facilities are often similar…
    • Eventual technology licensing or acquisitions are more likely than outright displacement
  • Possible Outcome ?
    • Many subsegments : many firms can succeed
    • Still might follow the old rules of thumb…
      • 10% huge successes 40 firms
      • 30% worthwhile businesses 110 firms
      • 30% break even 110 firms
      • 30% unsuccessful 110 firms
    • More likely we will see fewer huge successes, though fuel price run-ups may mean more worthwhile businesses.