Had the pleasure of attending the annual Energy Venture Fair this past week. It's an interesting pitch-fest where dozens of energy tech startup CEOs come to give 15 minute presentations to potential investors (or, more often than not, each other).
Because about five company presentations go at the same time, it's always fun to see which rooms are crowded and which are not. This year's big winners (based upon the number of investors sitting taking notes) appeared to be anything solar- or biofuels-related, which is really no surprise. But there were some interesting companies present, and a nice breadth of techs and markets represented. You can read about the companies that were selected as "Most Promising" here: Wilson TurboPower, Zolo Technologies, KiteShip, Ice Energy, and Hythane. Neal Dikeman also has a few thoughts on the event.
Very unfortunately, I missed Steve Jurvetson's plenary keynote, which several people I spoke to later said was very good, and only caught the tail end of Tim Healy's (CEO, EnerNOC) rallying-cry speech. But I was able to see most of the investor panel that spoke at lunch on day one, which included Stephane Dupont of the NVCA as moderator, and Philip Deutch of NGP Energy Technology Partners, Scott MacDonald of SAM Private Equity, Pete Higgins of Second Avenue Partners, and Erik Straser of MDV. Some notable statements from the panelists (and as always, having no claim to journalism, note that these are often paraphrased, so names are omitted to protect the innocent):
"In these markets, lifecycle adoption varies. There are opportunities for both grand slams and longer term plays."
"Spend the time to think through the issues and put yourself in your investors' shoes. Get them up to speed and make them comfortable as best you can."
"The absence of information is perceived by investors as bad news. Don't treat your board like they're the IRS, someone to keep at an arm's length relationship."
"We are seeing the top 20% of entrepreneurs in the Valley and elsewhere stopping what they've been doing and coming into these value chains [energy, etc.]. They know how to take risk out in a staged way, how to grow a business in a venture context. We like to see a balance -- know the domain, but it's best not to be so embedded in it that you don't know what aspects of the industry's history to listen to, and what not to."
"I've always found that a CEO who's upfront about challenges, and gives both the pluses and the minuses, is refreshing."
"Really, we invest in the technologist and not the CEO, because we invest fairly early. We need to make sure that there's alignment around the vision for the company, as well as the role for the technologist looking forward."
"In Europe, we're challenged to find entrepreneurial CEOs. There's not as much of a venture-backed, fast-growth culture."
"We look for very deep domain expertise in a founder -- that they're already in their customers' heads, and have knowledge of all of the subtleties that end up being very important when you're trying to get a P.O."
"We catch companies when the technology has moved from magic to science -- it's happened more than once, and it can be controlled. We will typically manage books for the company, and provide other support infrastructure, during the period when the VC is helping to figure out what to bring on board and when. And only when we've figured out the market, the customers, etc., is it time to provide the significant venture capital."
"Add infrastructure as slowly as you can. You can get by with a part-time controller for a while. Focus on what's most important in terms of getting that technology into the market."
"Everyone talks about IP, but few do it well. Maybe there are 15 people in the Valley who write good IP strategy. We try to identify the best strategists for a situation, then engage a litigator to gameplan what's likely to happen -- when you're eroding someone else's margins, they will react."
"At a certain level, IP is irrelevant. You need to execute, and that's how you create an advantage. IP is not a silver bullet."
"Right and wrong doesn't determine legal outcomes. So it's important to have the right team, not patents."
As for me, I would suggest winnowing down the presenting companies a bit so that the event could be truncated to one day. With a two-day event full of repeated presentations, investors naturally come to only one or the other but not both. And that's a big hindrance on the value of networking. Keeping the event to one day would improve the networking for investors, and that would probably bring even more of them out... But overall, a very interesting couple of days in Santa Clara.