Recent Posts:

Some random cleantech VC thoughts and aphorisms

Rob Day: June 25, 2010, 8:43 PM

Been away on a major travel binge, so apologies for a download of a bunch of randomness that has accumulated over the past few weeks.  So, in no particular order:

1. Selling even millions of dollars' worth of a Gen 1 product at zero or negative gross margins doesn't count as "Commercialization".  It's just a large beta test.  ...Yes I'm talking to you, thin film solar and solid-oxide fuel cell industries. 

2. Tom Pincince, President and CEO at my portfolio company Digital Lumens, is also a former Forrester Research analyst.  And he has some pretty interesting predictions on LEDs.  Definitely check them out.

3. VC/PE funds often pass on great deals.  And know it.  Constantly-shifting...

More on the Massachusetts innovation gap

Rob Day: June 13, 2010, 9:30 PM

I got a lot of feedback on my last post comparing Massachusetts with California in terms of Research, Innovation, and Commercialization of clean technologies.  One respondent, my friend Jay Fiske of Wakonda Technologies, was so knowledgeable and thoughtful in his take that I asked him to write it up as a guest blog post.  So... Enjoy!


In his most recent post, Rob Day asks why the West Coast seems to be better at commercializing cleantech research than the East Coast.  

It's a great question.

As a former cleantech venture investor with the Massachusetts Green Energy Fund and as Vice President of Operations for Wakonda Technologies -- a company developing high-efficiency,...

Massachusetts’ cleantech challenge: Turning Research into Innovation

Rob Day: June 6, 2010, 12:38 PM

Apparently, June is Innovation Month in New England.  So I thought I would write a bit about one of the perplexing things about cleantech investing in New England.

Now, every region ends up being a bit self-centered at times, and New England is certainly no exception.  But it's a commonly-held and oft-stated position among those involved in energytech innovation in this region that "Massachusetts is THE world-class center of research in energy and clean technologies".

If you are one of those who takes this kind of statement literally, then it probably comes as some surprise to then see that California typically attracts significantly more cleantech venture dollars than Massachusetts,...

Risk vs. Reward

Rob Day: May 27, 2010, 8:49 AM

One thing that non-VCs typically don't have a good understanding of is how different venture investors view the risk versus reward tradeoff when it comes to managing portfolio companies.

How do VCs get compensated, besides salary?  "Carry", a/k/a profit-sharing.  And except in very few cases, carry on an entire fund, not on a per-deal basis.  Everyone in the industry is familiar with the studies that have shown that fund performance is typically determined, at least on the upside, by a handful of deals across an entire portfolio.  In other words, 1 or more really big wins drive all the performance.  And, by the way, 1 or more really big wins really drive a VC's career as well, because...

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...