Venture Finance falls for Clean-Tech
The quantity of venture capital going into clean technology dropped sharply in the early months of the present year. According to figures released today by the Cleantech Group, venture investments in the sector are down 48 p.c in First-quarter of 2009, compared to a year before.
Investments had also fallen in the final quarter of 2008. The Q1 results, according to the group, “represent the lowest level of venture capital investment in clean technology companies” since Q4 of 2006. Worldwide clean-tech investment for the quarter totaled $1 bn.. The average quantity of financing in each round in addition has fallen, from $20 million in the 3rd quarter of 2008 ( which was when clean-tech investing over all topped at $2.6 bln ) to $12.3 million now.
“We’re seeing less deals and smaller deal values,” expounded Greg Jaw , a Silicon Valley-based partner in the rising company group at the legal company Latham & Watkins. “We will continue seeing bad news as we climb out of this,” he explained. The good news of a sort is that other sectors seem to be wounding more. Clean tech now draws the most venture investments of any sector, lately surpassing software or biotechnology, according to the Cleantech Group. The impulse package, and the president’s stress on clean energy, could also breathe new life into Silicon Valley, Boston and other clean-tech hearts.
“We’re more optimistic about clean tech this year than we are for venture capital investment over all,” declared Mr Jaw , who observed that the most significant thing the state could do was “help the provision of credit and capital.”.
The rare firms able to squeeze out venture capital in the 1st quarter included Norsun, a Norwegian maker of polysilicon ( a key ingredient in solar panels ), which got a $72 million round ; SolFocus, another solar company, with $67 million ; and Boston Power, a lithium-ion battery company, which raised $55 million. Over all, solar corporations brought in the most venture greenbacks in Q1.
However, “some of the backers we are speaking to are pronouncing at this time solar appears to be over-funded,” announced Mr Jaw , who identified “smart grid” technology as an area of future guarantee for Silicon Valley.