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SDTC - Ontario Clean Technology Business to Business Seminar


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The vision of Masdar City (the world’s first zero-carbon city to be created before 2020) was shared by the Masdar City team at a September 16, 2009, business-to-business seminar held at MaRS.

The seminar attracted nearly 70 cleantech suppliers, green technology leaders, government policy makers and sector funders. This presentation is from Sustainable Development and Technology Canada, created for this seminar.

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SDTC - Ontario Clean Technology Business to Business Seminar

  1. 1. Ontario Clean Technology Business to Business Seminar September 16, 2009 David Harris Kolada Vice President, Corporate & Market Development
  2. 2. SDTC Mandate <ul><li>SDTC is a policy instrument of the Government of Canada to deliver environmental and economic benefits to Canadians. </li></ul><ul><li>We protect all elements of our natural capital: </li></ul><ul><ul><ul><li>Clean Air </li></ul></ul></ul><ul><ul><ul><li>Climate Change </li></ul></ul></ul><ul><ul><ul><li>Clean Water </li></ul></ul></ul><ul><ul><ul><li>Clean Land </li></ul></ul></ul><ul><li>Forge innovative partnerships and build a SD technology infrastructure. </li></ul><ul><li>Ensure timely diffusion - increase number and rate of uptake of technologies into the marketplace across Canada, providing national benefits. </li></ul>
  3. 3. SDTC Snapshot <ul><li>SDTC operates two funds: </li></ul><ul><li>$550 million SD Tech Fund™ launched on April 4, 2002. </li></ul><ul><li>Aimed at development and demonstration of emerging clean technologies. </li></ul><ul><li>$425 million allocated to 171 projects. </li></ul><ul><li>$500 million NextGen Biofuels Fund™ was launched on September 12, 2007. </li></ul><ul><li>Aimed at establishment of large demonstration-scale facilities for next-generation renewable fuels and co-products. </li></ul><ul><li>First application currently in due diligence process. </li></ul>The funds are complementary and address different gaps in the Innovation Chain
  4. 4. Funding Gaps Fundamental Research Technology Development and Demonstration (Pilot to Full Scale) Product Commercialization & Market Development Market Entry & Market Volume Industry Industry Applied Research Public and Private Sector Research in 2008 $29B (preliminary) Source: Stats Canada VC Funding in 2008 $1.3B Source: Thomson Financial SD Tech Fund NextGen Biofuels Pre-IPO Gap Funding Intensity Pre-Commercial Gap Governments Angel Investors Banks Venture Capital High CAPEX Gap
  5. 5. Clean Technology – Definition <ul><li>Clean technologies are innovative products or services that simultaneously reduce financial and environmental costs while driving better performance. </li></ul><ul><ul><li>Economy: Improved operational performance, productivity or efficiency; reduced input costs. </li></ul></ul><ul><ul><li>Environment: Reduced energy consumption, waste or pollution. </li></ul></ul><ul><ul><li>Society: Improved quality of air, water and land. </li></ul></ul><ul><li>Clean technology products are: </li></ul><ul><ul><li>Lighter, smaller and stronger. </li></ul></ul><ul><ul><li>Less expensive to manufacture and operate. </li></ul></ul><ul><ul><li>Less carbon-intensive and more energy-efficient. </li></ul></ul><ul><ul><li>Higher in economic value per unit of material input. </li></ul></ul><ul><ul><li>Ecologically sustainable, or at least less harmful. </li></ul></ul>
  6. 6. Portfolio Status - Results to Date <ul><li>Applications to Date (15 Rounds) </li></ul><ul><ul><li>1,670 applications (>5000 entities) </li></ul></ul><ul><ul><li>$4.1 Billion in funding requests </li></ul></ul><ul><ul><li>$16.0 Billion in total project value </li></ul></ul><ul><ul><li>90% industry-led </li></ul></ul><ul><li>Projects Approved (14 Rounds) </li></ul><ul><ul><li>171 projects </li></ul></ul><ul><ul><li>$425 Million from SDTC </li></ul></ul><ul><ul><li>$1.01 Billion leveraged from consortia members </li></ul></ul><ul><ul><li>$1.44 Billion in total eligible project value </li></ul></ul><ul><li>24 Projects Completed Since Inception </li></ul>* Includes funds from federal departments, provincial governments and academia Total Eligible Project Costs $1.44 B SDTC Contribution $425 M (30%) Leveraged Funding $1.01 B (70%) Industry Leveraged Funding $846 M (84%) Other Funding* $164 M (16%)
  7. 7. Investment Portfolio (as of September, 2009) SDTC’s current investment in 171 projects totals $425 million. SDTC Funding Breakdown by Sector SDTC-supported projects contribute technology solutions to major economic sectors in Canada.
  8. 8. SDTC - More Than Funding SDTC’s mission is to “act as the primary catalyst in building a sustainable development technology infrastructure in Canada”. <ul><li>Building Young Companies </li></ul><ul><ul><li>Help entrepreneurs sharpen their market savvy, increase their ability to identify the economic and environmental strengths of sustainable development projects, and define their value proposition. </li></ul></ul><ul><li>Reducing the Risk to Enable Private-Sector Funding </li></ul><ul><ul><li>De-risk clean technologies in a way that will ultimately attract downstream private-sector investment by stringent due diligence process and strengthening project consortia. </li></ul></ul><ul><li>Analysis and Market-Focused Policy Advice to Government </li></ul><ul><ul><li>Through SD Business Case™ reports, work with industry, academia and various levels of government to analyze current needs, determine the proper course that should be taken and to outline the technology and policy instruments needed to get there. </li></ul></ul>Building a cleantech infrastructure in Canada requires in-depth industry experience, market knowledge, and technical expertise.
  9. 9. SDTC is the Market Maker for Cleantech in Canada SDTC and its partners invest 1.5x the total private investment in cleantech, driving overall cleantech venture capital funding in Canada “ I would say SDTC’s program is one to be proud of. It has a very impressive record of creating partnerships between industry and investors.” David Henderson, Managing Director, XPV Capital Corporation “ .. there is also a strong view among key informants including those from the VC sector that completing an SD Tech Fund project yields important benefits. “Companies that have gone through the SDTC process have a higher probability of getting capital investments and of success in the market.” Extract from SDTC 2 nd Interim Evaluation Report, May 2009 Source: Thomson Reuters, March 2009 “ SDTC has been of terrific assistance to our portfolio companies. It forces start-ups to engage with partners and form consortia that result in lasting value. To me, SDTC is a key competitive advantage of building a cleantech company in Canada.” David Berkowitz, General Partner, Ventures West
  10. 10. Trends in Canadian Cleantech Financing are Concerning Reduction in Canadian cleantech financing levels began earlier than the US and is worsening in relative standing Source: Cleantech Group LLC
  11. 11. SDTC-Supported Companies Enjoy Greater Relative Financing Success Follow-on funding in SDTC portfolio companies continues an upward trajectory despite the overall declining Canadian Cleantech financing market Sources: Thomson Reuters, SDTC <ul><li>SDTC support of clean technology has stimulated all forms of private sector investment i.e. Angel, VC, private equity, debt etc. </li></ul><ul><li>These investments in SDTC companies exceed support to other companies and is greater than pure VC plays </li></ul><ul><li>Private sector investment has grown with time </li></ul><ul><li>Private sector investing has suffered with the economic downturn, although the decline in cleantech investing is less severe </li></ul>Sources: Thomson Reuters, SDTC SDTC and Partners Project Funding (seed and early stage) Private Sector Investment to SDTC Portfolio Companies (mid and late stage – all forms of financing) Private Sector Cleantech Investment – VC Financing only (all stages)
  12. 12. Global Green Stimulus: Demand Pull Source: Stern & Edenhofer, Towards a Global Green Recovery, April 2, 2009
  13. 13. SDTC is an Important Player in the Global Cleantech Sector Number and Amount of Investments Participated in by Top Global VC Firms Cleantech Network, Jan 2009 With 171 projects to date, SDTC has the largest number of deals and hence is a critical provider of early-stage companies to the cleantech sector. Deals
  14. 14. Visit our website at: For more information Our Mission: “ The Foundation will act as the primary catalyst in building a sustainable development technology infrastructure in Canada.” Vancouver Office: World Trade Centre Suite 404 - 999 Canada Place Vancouver, BC V6C 3E2 Tel : (604) 844-2857 Toronto Office: First Canadian Place, 100 King Street W., Suite 3700 Toronto, Ontario M5X 1C9 Tel: (416) 644-8726 Ottawa Head Office: World Exchange Plaza 45 O’Connor Street, Suite 1850 Ottawa, Ontario K1P 1A4 Tel: (613) 234-6313