Vc Energy Investments

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Energy Clean Tech Venture Capital Investments

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Vc Energy Investments

  1. 1. Sample of Venture Capital investments in Energy and Clean Tech
  2. 2. 372 Energy Investments from 22 VCs <ul><li>Only a sample </li></ul><ul><ul><li>Not an exhaustive list of VC investments </li></ul></ul><ul><ul><li>Many large public and private firms in the energy industry are active innovators </li></ul></ul><ul><ul><li>Energy projects are expensive, and privately funded projects allow startups to innovate without VCs </li></ul></ul><ul><li>Not a systematic sample </li></ul><ul><ul><li>Ignores smaller VCs in energy </li></ul></ul><ul><ul><li>Ignores investments outside a VC’s normal market </li></ul></ul>
  3. 3. VC firms sampled The 372 entrants in this sample are (or once were) funded by… <ul><li>21 Ventures </li></ul><ul><li>Accel </li></ul><ul><li>Access Venture Partners </li></ul><ul><li>Altira </li></ul><ul><li>Battery Ventures </li></ul><ul><li>Braemar Energy </li></ul><ul><li>CMEA </li></ul><ul><li>Draper Fisher Jurvetson </li></ul><ul><li>Element Partners </li></ul><ul><li>Enertech Capital </li></ul><ul><li>FA Technologies </li></ul><ul><li>Flagship Ventures </li></ul><ul><li>Khosla Ventures </li></ul><ul><li>Mohr Davidow </li></ul><ul><li>New Enterprise Associates </li></ul><ul><li>NGEN </li></ul><ul><li>Nth Power </li></ul><ul><li>Quercus Trust </li></ul><ul><li>Rockport Capital Partners </li></ul><ul><li>Technology Partners </li></ul><ul><li>US Renewables Group </li></ul><ul><li>VantagePoint </li></ul>
  4. 4. Sources & Generation are targeted more than Efficiency and Conservation
  5. 5. Efficiency & Conservation entrants serve fragmented markets <ul><li>All of these segments are in turn easily subsegmented. </li></ul><ul><li>No “winner take all” subsegments. </li></ul><ul><li>Doesn’t mean any individual entrant will prove viable. </li></ul>
  6. 6. Example: Building Materials New firms have good chance of success but not of dominance <ul><li>Sampled firms in this segment… </li></ul><ul><li>ARXX green building products </li></ul><ul><li>Aspen Aerogels nanoporous insulation </li></ul><ul><li>Calera glass and cement </li></ul><ul><li>Calstar Products green building products </li></ul><ul><li>Ecore green building products </li></ul><ul><li>FreeGreen low energy house plans </li></ul><ul><li>Greenstone Industrs home insulation </li></ul><ul><li>Hycrete green building materials </li></ul><ul><li>Icynene spray foam insulation </li></ul><ul><li>Microposite green building products </li></ul><ul><li>PAX Streamline homes </li></ul><ul><li>Project Frog quick-to-deploy buildings </li></ul><ul><li>Serious Materials green building products </li></ul><ul><li>Architects will still choose among new building materials based on color, texture, and methods of application. </li></ul><ul><li>… but construction markets are still troubled today </li></ul>
  7. 7. A Healthy Variety of Supply Segment Entrants <ul><li>A wide variety of supply concepts may be well suited to niche applications that will help them meet their early growth targets. </li></ul>
  8. 8. Forecasts Get Surprised ! <ul><li>Oil prices are very high </li></ul><ul><ul><li>speculation against the dollar </li></ul></ul><ul><ul><li>Chinese Demand </li></ul></ul><ul><ul><ul><li>May be demand from people who near Bejing </li></ul></ul></ul><ul><ul><ul><li>May be demand from the same people who brought you the “Chinese Wall” in banking </li></ul></ul></ul><ul><li>Gas prices are very low </li></ul><ul><ul><li>Poor economy </li></ul></ul><ul><ul><li>Unneeded gas released by power generators </li></ul></ul>
  9. 9. Impact on Innovation… <ul><li>Price spread for nonpetroleum transportation fuels is much higher, but the winner still takes all. </li></ul><ul><li>Electricity prices are lower due to low natural gas prices, so high oil prices do not equal high prices for renewable power ! </li></ul><ul><li>Building conservation isn’t so interesting. </li></ul><ul><li>Alternative vehicles are in today’s sweet spot. </li></ul>
  10. 10. Some Segments Appear Crowded <ul><li>Commodity nature of energy can mean “winner takes all.” </li></ul><ul><li>Most affected are: </li></ul><ul><li>bioderived fuel photovoltaics </li></ul><ul><li>solar systems </li></ul>
  11. 11. Solar Subsegments <ul><li>Some subsegments will shake out, BUT… </li></ul><ul><li>Many firms work in more than one subsegment </li></ul><ul><li>Development firms can change focus </li></ul>
  12. 12. 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
  13. 13. Biofuel Subsegments <ul><li>Most efficient technologies should displace others, BUT </li></ul><ul><li>Performance in adverse weather may create segments </li></ul>
  14. 14. Furthermore <ul><li>A large chunk of cost in a biofuel segment is feedstock gathering and transport </li></ul><ul><li>Each installed facility should dominate its local market </li></ul><ul><li>Since physical processing facilities are often similar… </li></ul><ul><li>Eventual technology licensing or acquisitions are more likely than outright displacement </li></ul>
  15. 15. Possible Outcome ? <ul><li>Many subsegments : many firms can succeed </li></ul><ul><li>Still might follow the old rules of thumb… </li></ul><ul><ul><li>10% huge successes 40 firms </li></ul></ul><ul><ul><li>30% worthwhile businesses 110 firms </li></ul></ul><ul><ul><li>30% break even 110 firms </li></ul></ul><ul><ul><li>30% unsuccessful 110 firms </li></ul></ul><ul><li>More likely we will see fewer huge successes, though fuel price run-ups may mean more worthwhile businesses. </li></ul>

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