First of all, comes the news today (from Jonathan Shieber at VentureWire) that Element has done a first close on their latest fund at $270mm, and that it's likely they'll "fly past" their $400mm stated target. A very good example of how the sector continues to shift toward later stage: One LP (LACERS) reports that Element plans to allocate only 20% of the fund to early stage investments, with the rest going to expansion stage and later stage. They're far from alone, and this news is proof of the continued strong LP interest in the sector.
Secondly, on the topic of biofuels and food prices (headline stuff these days), stay tuned for an upcoming report from New Energy Finance on the subject... As a preview, there's the following passage:
New Energy Finance has analysed food price increases between January 2004 and April 2008, breaking them down into their constituent drivers: input costs, dollar depreciation, supply-demand factors and speculative activity (see Figure 2). We conclude that increased biofuels production has been a meaningful driver of food price inflation, particularly in certain crops and geographies, but it is far from the dominant factor. Increases in input costs have played a much larger role, as have changes in consumption habits and increases in global population which, for the first time in decades, have not been offset by increases in agricultural yields, particularly in grains (see Figure 3). Furthermore, where biofuels have had significant impacts, this has been due to overly-rapid application of support schemes and protectionism, rather than to the impact of production on land use itself.
Thirdly, I thought this passage from Tim Healy's (EnerNOC) Chairman's Letter was also worth quoting:
I believe that energy is one of every company’s five basic inputs, along with land, labor, raw materials and tools. (Information Technology, the realm of the CIO, is a subset of tools.) But in most cases, energy is the only one that is not actively managed. Corporations invest time and talent in assessing and developing land; in managing and motivating labor; in forecasting and negotiating the price and supply of raw materials; and in sourcing and procuring equipment and tools. Energy hasn’t normally received a similar level of senior executive attention. For example, US corporations spent an estimated $129 billion per year on telecommunications in 2007, and all of them also invest in advanced products and services to actively manage these systems. But less than one per cent of companies make a significant investment in advanced technology to manage electricity, even though electricity spending was greater at approximately $194 billion per year.
Are the above three notes sobering? Encouraging? Readers will judge for themselves.
Deals from the past few days:
- SmartSynch, a smart meter technology developer, raised $20mm in expansion funding from Credit Suisse. This follows on their $10mm insider Series D last year.
Cleantech investors in the news:
Other news and notes: Jeffries reports that the cleantech IPO backlog is starting to build
... Bill Aulet has some pretty interesting thoughts
about decoupling energy and water... Also worth checking out, a good interview by Neal: Marc Stuart on the REAL story of carbon offsets
... For those who may have seen the VCJ's kind write-up about this blog (and its author) in the latest issue, a couple of small corrections -- no, I don't live in Connecticut and drive to Boston every day; and no, M2E Power
isn't putting flashlights into cell phones, they're developing innovations to power the cell phone (and other devices) altogether. But yes, this site does lack in personality at times, it's true... Finally, this will be fun to watch