The State of the Cleanweb
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You’ve heard that software is eating the world. This report, with data powered by CB Insights, shows how resources and energy are software’s next meal
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The State of the Cleanweb
- 3. Inrecentyears,we’veseentheemergenceof SMARTGRID SHARINGECONOMY CONNECTEDHOME++ What do these innovations have in common?
- 5. Cleanweb* 1. An emerging global ecosystem of digital technologies that enable more efficient use of resources. 2. An operating system for the planet (klenweb) Wecallit * Coined in 2011 by Sunil Paul and Nick Allen, co-founders of Sidecar and an early investor in LinkedIn (Paul)
- 6. What’sin thisreport 8 14 22 43 Why is this happening now? Notable examples The Cleanweb market & ecosystem Our challenge to you
- 7. Snapshot Selectedrecent investment activity $8B+ invested in Cleanweb start ups from 2009-2014 Cleanweb is a theme found across sectors Several successful, disruptive businesses are emerging At scale, it can address major environmental challenges However, “green” often isn’t the primary or intended benefit AirBnB Bla Bla Car CropX CrowdComfort ecoVent Enbala Enevo Intelex Rubicon Global Sighten ThredUp Uber $1.5B $160M $9M $1.4M $6.9M $3M $15.8M $160M $50M $3.5M $81M $1.2B 6/28/15 9/8/15 6/22/15 11/6/15 7/27/15 9/15/15 6/30/15 8/13/15 9/18/15 11/2/15 9/10/15 9/7/15 77
- 9. DIGITALREVOLUTION Digital technology is now ubiquitous, cheap and very powerful RESOURCEREVOLUTION Addressing acute resource challenges presents one of the biggest opportunities of the 21st century Internet ofThings Mobile Social Cloud Software Sensors Big Data Moore’s Law Digital natives Population growth Developing economies Commodity volatility Distributed energy Clean technologies Urbanization Extreme weather Drought Climate adaptation Innovationanddisruptionisoccurringduetothecollision oftwoglobalmega-trends... THE CLEANWEB <<ENTREPRENEURS>> <<CAPITAL>> <<INNOVATION>> * Thanks to Robb McLarty for inspiring this slide 9
- 10. “In short, software is eating the world” MarcAndreesen WallStreetJournal,August20,2011 DIGITAL REVOLUTION1 10
- 11. (100X increase from 2003) 2 (Q4 2014) 1 IoT DECREASEINSTARTUPCOSTS OVERTHELASTDECADE BECAUSEOFCLOUDCOMPUTING 3 Digitaltechnologyisnowubiquitous,cheap, andverypowerful ThepublicmarketcapofI.T.companiesisroughlyequaltodaytothatofoil&gas, coal,realestate,andindustrials combined. 75% U.S.SMARTPHONE PENETRATION 50B 100xCONNECTEDDEVICES BY2020 DIGITAL REVOLUTION1 11 4
- 12. “We’re facing this unprecedented set of constraints—in food, in land, in energy, in water, all across the planet, with 6 billion people going to 9 billion people all consuming resources. It’s a challenge to humanity, a challenge to ingenuity, to innovation.” McKinsey&Co. http://www.mckinsey.com/insights/energy_resources_materials/resource_revolution RESOURCE REVOLUTION2 12
- 16. DATAisdrawingamorecompletepictureofresource use,enablingdetailed&actionableintelligence EXAMPLE: Greater crop yield using less water and fertilizer. 16
- 17. SENSORSarebuildingtheinternetofthings,allowingus toliveinclosertouchwiththepulseoftheplanet EXAMPLE: Intelligent lighting systems only turn on when needed and can reduce energy waste up to 90%. 17
- 19. MOBILEisputtingeasier,moreefficientchoices inthepocketsofeveryone,everywhere Less empty cars,traffic,air pollution,and fuel waste. 19 EXAMPLE:
- 20. SOCIALisenablingpeopletoshareresources,poolcapital, andmultiplyactionsthatdrivebehaviorchange EXAMPLE: The average home stay is 66% more resource efficient than a hotel room. 20
- 21. WithanincreasingnumberofCleanwebcompanies emergingacrossindustries... thepotentialimpactissignificant. Energy Buildings Transportation Consumer 21
- 23. Earlytrendsetters haveproventhere isgrowingmarket demandfor Cleanweb solutions... 80M+ STAYS 1M+ PROPERTIESWORLDWIDE 60M 160Mof ACRESOFU.S.FARMLANDAREUSINGCLIMATECORP. $300MANNUALREVENUE (estimated by Morgan Stanley) 95 incl. UTILITIES 28 OFTHELARGEST U.S.UTILITIES 23
- 25. CAP LIGHT QUICKTO MARKET SCALABLE VERY VALUABLE ATSCALE GOODFOR PLANET& PEOPLE $ CLEANWEBCOMPANIESARE... Capital is moving because 25
- 26. 8Binvested$ 500+companies 800+deals VentureLandscape&Trends 2009-2014 Data powered by CB Insights. *Uber has been excluded from dataset due to outlier status 26 TheStateoftheCleanweb
- 27. CleanwebFundingAcceleratedintheBeginningof2014 After five years of relatively constant funding levels in the Cleanweb space, Q2 2014 saw a 170% increase in funding from Q1 2014 and a 484% jump from the same quarter a year earlier. A handful of mega deals including ride-sharing startup Lyft boosted the funding total. Q 1 2009 Q 3 2009 Q 1 2010 Q 3 2010 Q 1 2011 Q 3 2011 Q 1 2012 Q 3 2012 Q 1 2013 Q 3 2013 Q 1 2014Q 2 2014 37 Cleanweb Investments Eight Quarter Trend 17 152 20 237 27 394 30 244 37 364 38 294 31 463 55 397 47 375 54 473 49 277 38 183 45 336 42 384 38 475 47 321 34 246 44 311 37 398 55 539 41 1457 41 DealsInvestments ($M) 27
- 28. InvestmentAcrossIndustriesby%DollarShare Cleanweb Industries, by Dollar Amount 2009 – H1 2014 ($M) Built Environment Utilities Enterprise Software Transportation & Automotive Consumer Products Waste Management Agriculture, Food, and Beverage Finance 29% 25% 16% 14% 4% 3%2%0% 28
- 29. Late-StageDealShareOntheRisein2014* In 2014, Series E+ deal share grew to 10%, and Series D share doubled. Series C deals grew since 2010, and remained at 17% in 2013 and 2014. 2009* Based on 1H 2014 data 5% 5% 8% 29% 30% 24% 8% 29% 26% 30% 11% 7% 19% 28% 31% 12% 5% 21% 29% 30% 17% 19% 27% 10% 30% 6% 17% 22% 22% 23% 2010 2011 2012 Share of Cleanweb by Series – Deals 2009 – H1 2014 2013 H1 2014 Seed / Angel Series A Series B Series C Series D Series E+ 29
- 30. Partofashiftawayfromearlierstages Between 2009 and 2013, Series C funding share grew steadily from 19% to 41% while Series A and B shrunk. Series E has also steadily grown from it’s small share in 2010 to 20% of funding dollars in 2013. In 2014, Series D has so far had the most funding primarily due to nine-figure funding rounds to AirBnB and Lyft. Share of Cleanweb by Series – Dollars of Funding 2009 – H1 2014 2009 25% 7% 15% 30% 23% 25% 6% 7% 46% 14% 20% 16% 5% 39% 17% 35% 17% 11% 20% 15% 41% 20% 21% 13% 29% 49% 7% 11% 2010 2011 2012 2013 H1 2014 Seed / Angel Series A Series B Series C Series D Series E+ 30
- 31. 7Outof10ActiveCleanwebInvestorsAreU.S.-Based 71% of Cleanweb investors that completed a deal since 2009 were based in the U.S. 21% originated from Europe/Middle East. Notable international firms including Index Ventures (United Kingdom) and Siemens Venture Capital (Germany) which made the most deals of the non-U.S. firms. Cleanweb Investor Geographies Active Investors, 2009 – H1 2014 4% 4% United States Europe/Middle East Asia All Other 71% 21% 31
- 32. Thesearethesectorswherecleanwebcompaniesare attractingthemostfunding. Top 5 Cleanweb Industries, by Deal Count 2009 – H1 2014 Built Environment 253 Utilities 237 Enterprise Software Transportation & Automotive 174 113 Consumer Products (e.g. Digital Lumens) (e.g. Enbala) (e.g. Tradeshift) (e.g. Vinli) (e.g. Birdi) 59 32
- 33. MostinvestmentflowingtocompaniesbasedinU.S. 73% of Cleanweb companies that received funding since 2009 were based in the U.S. Another 20% were located in Europe and the Middle East. Some notable companies in these areas include Landis+Gyr (Switzerland), Wimdu (Germany) and GreenPeak (Netherlands). Cleanweb Geographies of Unique Funded Companies 2009 – H1 2014 73% 20% 2% 5% United States Europe/Middle East Asia All Other 33
- 35. Talented entrepreneurs aredivingin. Data Scientists Designers Environmentalists Sharing Pioneers Serial Entrepreneurs Hackathon Winners Libertarian disruptors Silicon Valley Billionaires TechCrunch Disrupt WinnersSoftware Execs 35
- 36. Bigcompanies areusing digitaltodrive efficiency. Intelligent energy infrastructure Automating efficiency Luxury car sharing Smart electric vehicle charging IoT supply chain efficiency + ICT-based sustainability solutions 36
- 37. Andit’snotjustforbusiness. Digitaltechgives NGOspowerful toolstoaddress humanimpact. Monitoring forestry loss with satellites Tracking fishing catches through simple sensors An early-warning system for threatened tropical mammals and birds using large datasets from camera traps WILDLIFE PICTURE INDEX ( ) 37
- 38. Governments areseeingthe opportunitytoo. Harnessing the digital innovation community in NYC to make the city more efficient Taking a data-driven approach to energy efficiency In Washington, D.C. Providing unique analysis of worldwide climate data BUILD SMART DC 38
- 39. Citiesarenatural platformsfor Cleanweb innovation... CONCENTRATEDNEED 75% of natural resources are consumed by cities 54% of world population lives in cities (75% by 2050) URBANIZATION 39 6 7 60%+ of urbanites have smartphones DIGITALACCESS 8
- 40. butruralareas arebenefitting aswell. Using mobile phones to map water supply in India Crowdfunding off-grid, pay-as-you-go solar projects Deploying drones to protect endangered species 40
- 46. AbouttheAuthors Supercollider discovers and grows companies that harness digital technologies to positively transform how we use energy and resources. Part seed fund, part design firm, part customer development lab, Supercollider embodies a new way of thinking about how to create value through rich engagement with entrepreneurs, their customers, and the world around them to forge solutions that are better for people and planet, making a cleaner, smarter world – today. Get in touch: info@supercollider.io On twitter: @SuperColliderHQ On Medium: medium.com/@SuperColliderHQ 46
- 47. AbouttheSponsors The New York State Energy Research and Development Authority, known as NYSERDA, promotes energy efficiency and the use of renewable energy sources. These efforts are key to developing a less polluting and more reliable and affordable energy system for all New Yorkers. Collectively, NYSERDA’s efforts aim to reduce greenhouse gas emissions, accelerate economic growth, and reduce customer energy bills. Mintz Levin is a full-service, general practice law firm with more than 450 attorneys, eight offices in the US and the UK, and a liaison office in Israel.A Boston institution since 1933, Mintz, Levin, Cohn, Ferris, Glovsky and Popeo is now a national powerhouse, claiming such blue chippers as Biogen Idec and General Electric as clients. Bay State pedigree notwithstanding, Mintz Levin's gaze has shifted westward-namely to the IP-rich tech and biotech hubs of San Diego and SiliconValley, and recently to San Francisco. Data powered by 47
- 48. Acknowledgements Shaun Abrahamson Alexandra Adler Nick Allen AVentures Rachel Barge Blake Burris Robyn Chase Cleantech Group Cleantech Open Regine Clement Kirk Coburn Will Coleman Michael Conti Rob Day Michael Ellis Lisa Gansky Chris George David Gilford Greentown Labs Oliver Guinness Graham Hill Sara Jayanthi Danny Kennedy / Powerhouse Emily Kirsch / Powerhouse Micah Kotch Riggs Kubiak Mitch Lowe Dillon MacDonald Sonny Masero Robb McLarty Shayne McQuade David Merkoski Patrick Morris Greg Neichin Obvious Ventures Bob O’Connor Billy Parish Oriol Pascual Sunil Paul Anton Prennis Jeremy Rifkin John Romankiewicz Fay Rotenberg Pat Sapinsley Jason Scott Mike Shimazu Adam Siemigenowski SJF Ventures Surge Accelerator SXSW Eco Jack Townsend Tyler Tringas Mark Vasu Bill Weihl Westly Group Emily Wheeler David Yeh We’d like to gratefully acknowledge the contributions of reviewers, practicitioners, investors, and others who have sharpened our understanding of the Cleanweb (apologies to anyone we’ve missed!) 48