Recent Posts:

In 2020: When China Rules the Clean Energy World

Rob Day: May 20, 2010, 9:07 PM

I've been most recently reading When China Rules the World.  A fascinating treatise on what happens to the world economy when, over the coming decades, China's economy becomes paramount in the world economic system.  China and cleantech is something I've been thinking about and investigating for some time now.

Timely then to see the report from New Energy Finance (note: opens pdf) that in Q1, China was the biggest recipient of clean energy project finance, nearly double that of the amount invested in clean energy project finance in the U.S., nearly two-thirds again more than that invested in Europe.

I think it's safe to say that China will be a major driver of clean energy and water...

By 2020: Green Homes

Rob Day: May 11, 2010, 7:54 PM

Why on earth would anyone care about new homes right now? Isn't that a dead market?

Yes, in the U.S. the new home construction market is down 75% from its 2005 bubble levels.  The industry is badly hurting and won't go back to bubble levels.  But that still represents around 400,000 new home starts per year.  This is still a huge market.

During the last decade the way to make money in U.S. home construction was obvious:  Just throw up some homes and let people buy them.  It was a seller's market.  But now in the "new normal" where existing home sales are down and new home sales are way down, this puts pressure on builders and developers to think more creatively as market power shifts...

By 2020: Plug-in vehicles

Rob Day: May 6, 2010, 8:25 AM

Back in my consulting days, at one point I was part of a major project with a regional investor-owned utility, helping them do an overall strategic and operational review of the entire business.  It was a great learning experience to see what such utilities think about and have to deal with from the inside perspective.  One thing that always stuck with me was when we looked at revenue-growth opportunities for them.  The answer was that there was really little that the IOU could do to significantly grow revenues within their regulated gas and electric utility business, other than to generally work to promote economic growth in their region -- not a lot of top-line high-CAGR possibility...

This is how it happens

Rob Day: May 1, 2010, 5:57 PM

Pretty timely re: my last post on water, this afternoon they declared a major water emergency in the Boston area, thanks to a huge water main break.  One million people, including everyone in my town, are under a "boil water" order.  I got a call from my local water district, a recorded message telling everyone not to use any water at all, not even lawn sprinklers, until they have it fixed.  Since the water main break is dumping 8 million gallons of water per hour into the Charles River, doesn't sound like it'll be fixed very soon.

I make sure and keep backup water supplies at the house just for such eventualities, but I was curious, so about an hour after the emergency was declared I...

How water will play out in the U.S.

Rob Day: April 19, 2010, 4:32 PM

I've been thinking a bit about water lately.  So much media attention and investor and entrepreneurial interest are expended on looming energy shortages, but water shortages are perhaps even more acute.  A recent article in Fortune gave a good brief overview of water from a global standpoint.  If you're looking for water statistics and updates, the website of XPV Capital (a water tech specialist) has some good info.

There are clear looming issues with water use in the U.S.  And there are lots of uncoordinated actions going on in various parts of the country, and some hand-waving in general, but I haven't seen anyone really start to play out what's going to happen.

But it's clear to me...

Small is beautiful

Rob Day: April 15, 2010, 9:30 AM

Happy tax day, everyone. 

Silicon Valley Bank put out a must-read study yesterday, examining returns from more than 850 VC funds in the U.S., looking specifically at returns by fund size.  And what they found out was that smaller funds do better than larger (>$250M) funds.

This won't be a surprise to some limited partners out there that I speak with, in my current dual role as both an LP and direct investor.  These LPs see smaller funds as being more focused and hungry.  As the SVB report states:

"Managers of [small] funds often have industry-specific expertise and focus on particular strategies or sectors compared to those of larger funds which usually target multiple stages and...

The other capital gap:  Truly capital-efficient growth businesses

Rob Day: April 6, 2010, 9:00 AM

"My job is to look for entrepreneurs who want to change the world," one young cleantech VC told me in an engaging twitter conversation last night, "and build bigger companies."

Very true words!  But how do we define "bigger companies"?

I've seen someone mention that only two percent of startups get their financing from venture capital.  I don't know the accuracy of that number, but it does ring directionally true.  That doesn't mean 98% of startups are bad businesses, however.

Let me describe two basic types of startups:

1. The big game-changing startup that is going to be manufacturing or otherwise producing something very new.  They're going to need some significant level of capital...