Recent Posts:

A Very Important Article About Cleantech Policy in the US

Rob Day: June 3, 2011, 10:19 PM

Take the time to read this Politico article.  It's an important glimpse inside the world of the environmental funding community, and the role the community plays in energy policy.

Just a few quick thoughts and questions:

1. Flooding D.C. with funding on a very periodic basis to support one or two specific legislative efforts is not, um, a terribly effective policy strategy.  

2. "[W]ho spent about 30 minutes with the group before racing out to watch a Chicago Bulls playoff game" ... No comment.

3. By reactively pulling back so hard on funding, environmental foundations are basically pulling the rug out from under many organizations that are only now hitting their stride....

How to Raise a First-Time Cleantech Venture Fund

Rob Day: June 2, 2011, 11:13 AM

The economy may be gearing up to double-dip, Congress and state-level governments may be soured on doing anything serious about energy technology and climate change, and LPs may be down on the venture capital category altogether. But I still continue to be approached by smart, motivated investors looking to launch a first-time cleantech venture fund. It's a testament to their enthusiasm and entrepreneurialism -- and to the continued evidence of the long-term business opportunity in these sectors.

But how can these entrepreneurial investors successfully launch a new cleantech venture firm?

My first piece of advice is: don't do it. Seriously, this is a very hard thing to do even...

When is a Venture Investment Not a Venture Investment?

Rob Day: May 23, 2011, 8:39 PM

First, a quick note: I've differed with Vinod Khosla a couple of times on this site in the past. But let's give him his due as well.  Read the story I've linked to here, and be inspired. Such drive and audaciousness is what venture capital is really all about -- and what makes great entrepreneurs. Especially in cleantech, where so many customers are change-resistant, all entrepreneurs and VCs should read this story and take it to heart.

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What exactly is a 'venture capital investment'?  

A definition seems obvious ('startup capital') but of course becomes devilishly difficult to place within specific boundaries. Generally speaking, VC as a subset of private equity is...

Some Thoughts on Corporate Cleantech

Rob Day: May 11, 2011, 10:12 AM

I've had a lot of good conversations recently with managers from large companies that are now eagerly looking into cleantech as a potentially strategic area. Many Fortune 100 companies, of course, have been all over cleantech for a few years now.  But it's still significant to note that a new wave of additional corporate strategy managers are looking anew into the sector and trying to determine if there are opportunities within it for growth for their company.  It's a really encouraging signal. And of course, I happen to agree with them that there are opportunities here.

Way way way back in the last century, I actually started my "cleantech" (of course, it wasn't called that back...

The Smart Grid Will Be Inside-Out

Rob Day: May 2, 2011, 8:02 AM

After two weeks away from everything, I'd planned on writing this post Sunday night. Somehow, I got a bit distracted. The 2011 news cycle has been incredibly intense so far, and shows no signs of slowing down anytime soon.

In any case, there's been a lot of news over the past few years about the smart grid and how utilities and startups and VCs are working to make the grid more data-driven, flexible, automated, etc. Very often, the discussions about the timing and pace of smart-grid rollout are focused predominantly on utilities and major vendors of transmission and  distribution equipment, including smart meters.

But while that's a large and important aspect of the smart grid...

How Big Cleantech VCs Can Suffer From Negative Selection Bias

Rob Day: April 13, 2011, 9:01 PM

One of the challenges for cleantech VCs, and for VCs in general right now, is the potential negative selection bias that comes from being a large fund. This particularly applies to the large, big-name firms that adopt a "go big or go home" perspective when it comes to their investments.

Many such large funds have minimum ownership targets -- they want to own at least 20% of the company they invest in, so that if it's a big success, they end up with a big return, which makes sense, right?  This is rarely a hard-and-fast rule, although it's often presented as such.  But whether it's a hard floor or not, big firms don't want to own only a small piece of the companies they invest in,...

What You Need to Know About the Q1 Cleantech Venture Numbers

Rob Day: April 5, 2011, 5:15 PM

Hardly surprising to see that the major headlines coming out of the release today of the Cleantech Group's Q1 numbers focused on the top-line dollar count -- $2.57B!

But here's what you need to read in that:

1. Yes, deal dollars were up, but deal counts were way down.

As we've talked about for a while now, cleantech VCs are continuing to shift to later-stage companies. In fact, 93% of dollars in the quarter went into follow-on rounds. That bears repeating: Only 7% of cleantech venture dollars tracked in the first quarter were for first rounds.

This is not a sign of health for the sector. It's not a sign that VCs are actively putting money into the sector. Rather, it's a sign...