First of all, maybe take a minute today to give to the relief efforts in Haiti.  The US State Department is recommending the Red Cross...

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Kanellos of GTM posted what I think is one of the more important cleantech VC quotes of the year, citing Bruce Pasternack of CMEA as saying, "I don't know if we'd make a Solyndra-type investment today."  He was apparently referring to the capital-intensity of Solyndra and companies like that, and saying that if another investment opportunity like that came along then CMEA might pass on the basis of that alone.  Kanellos concludes that "The big deals are done."

Kanellos' statement is a bit of an over-generalization, naturally, since he's paid to provoke.  There certainly will be big deals done in 2010, I know of a couple blockbusters in final stages already.  And Pasternack's statement was more about capital-intensive business models and not about single big rounds of financing.  But as a general principle it's right, and it's what we've talked about here for a while now: Cleantech VCs are saying that they're running away from capital intensive business models.  Lots of talk about lessons learned.

Interestingly, that's the conclusion some investors are drawing from a new set of numbers from a group with the somewhat unfortunate name of ChubbyBrain, which has joined the ranks of those doing tallies of U.S. venture capital investing.  I haven't really looked at their numbers before, but I like that they break out "Green" as an over-arching category across technology sectors, and they also provide good details about their methodology as to what deals they count (although they're less clear about how they then define those deals in terms of sectors, etc.).

In their review of their Q4 tally, they conclude that "green investments which are usually a significant contributor to the overall venture totals given their capital intensity fell significantly versus Q3 with investment funding dropping 38% even though deal count stayed steady."  In Q4 they tracked 55 deals totaling $565M, and in Q3 they tracked the same number of deals totaling $913M.  They also break their numbers down in a number of useful pie charts.

I read a bit of a contradiction in what ChubbyBrain's saying, since they tar all green investments with the "capital intensity" brush but then indicate, as we also saw in Wesoff's tally for GTM, that what happened in Q4 was a significant reduction in average size of cleantech deals.  So what happened?

Pretty much boils down to this:  Q3 saw two massive deals that didn't happen in Q4, Solyndra ($198M) and Suniva ($75M).  Take out those two and the delta in dollar amounts from Q3 to Q4 is largely removed, and yet the deal totals remain about the same. And in fact, if you look at their charts for Q2 through Q4 it's clear that Q3's high dollar total was just an outlier.

Much ado about nothing, in other words.

So once again we learn the same old lesson:  Pay more attention to the total number of deals and not the dollar totals, because the latter gets skewed by one or two deals out of the entire quarter.  And what the CB analysis showed was that the number of deals was "consistent" from Q3 to Q4.

I do really like the pie charts from CB, and am enjoying comparing the breakdowns of dollars versus deals.  So kudos to them...

In any case, there's very little evidence there that cleantech VCs are as of yet putting their money where their mouth is, and pulling away from capital-intensive investment models.  CB appears to have changed their categorizations a bit from one quarter to the next, which is unhelpful, but still they showed about 24 deals in Q3 (nearly half of the Green category) going into "Renewables" and "Automotive Manufacturing", while in Q4 something like two-thirds of the deals they tracked went into either "Energy & Utilities" or "Automotive & Transportation".  A bit of apples and oranges there, but it's consistent with Wesoff's count of 24 out of 82 deals in Q4 (note: global #s, not U.S.) going into solar.  Meanwhile, CB tracked only a handful of deals in Q4 going into Green subcategories like "Internet" and "Software" and "Business Products & Services", which could be expected to be less capital-intensive.

So basically, cleantech VCs are all claiming to be looking for less capital-intensive investments nowadays... but there's little evidence yet of any such trend, other than increased interest in energy efficiency and smart grid.  But even there, the pattern appears to suggest that VCs generally continue to want to big, not lean.