We've discussed before the important role that angels have to play in the cleantech investment sector. The biggest reason is because there can be longer gestation periods for cleantech startups (hard to release an early beta version into the market, as you sometimes can with other tech plays).  Thus, in this sector more than others, angels with more patient approaches than institutional investors can play an important role in bridging the gap between invention and commercialization. So it's very interesting to see mention of this analysis from the Kauffman Foundation which looked broadly at angel investment patterns across all sectors and estimated that overall, angels are earning comparable returns to those of institutional venture capital firms. Even more interesting was their conclusion that, when VCs follow onto angel investments, the results tend to be very binary -- either very good or very bad. Whereas angel-only startups tend to achieve a similar average, but more consistent, return. (Which highlights what I often tell entrepreneurs:  That they need to be very judicious when deciding whether or not to take in venture capital.  When it works, it works well for everyone.  But it certainly isn't the right fit for every good business idea.) So angels should take heart from this analysis and be encouraged to continue to play a more active role in the cleantech sector. Deals from the past few days:

• Expansion Capital Partners has done a follow-on $450k PIPE into portfolio company Biorem.

• Forestry biotech company CellFor has taken in a $24.5mm Series D from "late stage financial investors" and existing investors, bringing the total financing into the loblolly pine optimization company up to $100mm.

• It's project finance, not VC, but it's nevertheless well worth noting this $500mm effort to fund waste heat capture projects, by Denham Capital Management.

Cleantech investors in the news:  Russell Read of CalPERS is big on energy tech...  And Marty Lagod is big on water. Other news and notes:  An update on VCs and green chemistry...  An update on solar rooftop potential...  China's $3B carbon-related fund...  As we've discussed before, the amount of venture investment going into solar is eyebrow-raising...  Amen, Dan -- and for any skeptics out there, inform yourself...  For those tracking the 2008 presidential race with an eye toward potential impacts on environmental policy, here's a very handy chart (note: pdf)...  One wicked fast electric motorcyle (using A123 batteries)...  Finally, I'm still enjoying telling colleagues that the guy who probably could have been the next President has instead decided that he would prefer to have our job -- on that topic, someone needs to explain the concept of "carry" to the AP.

...Al Gore. If there was a Nobel Prize for PR, Kleiner would win it hands down. Time and again, they do a masterful job of getting reverential mass media attention for their partners and their portfolio companies. Some VC firms shun attention, but I think it can actually be a valuable tool for dealflow, and for helping open doors for value-add at the board level, when it's done correctly. The news today that Al Gore has joined Kleiner's team is a great example of how it can be done very well. I've personally been fielding calls from reporters all day looking for "reactions", and probably many others in the community have been as well. The media cycle is in full spin... Reactions probably won't be universally positive (Jean-Luc seems unimpressed), but besides being a very smart move for both Kleiner and Al (and Generations IM), this is a good thing for the sector. It just shows how the sector is now mainstream. It's really amazing to watch how what is now called "cleantech" (or, to give Kleiner their PR due, "greentech") has gone from the sidelines to the headlines over the past decade-plus that I've been working on environmental innovation. Even in 2004, there were only a handful of us VCs focused on the sector, and now it's a top priority investment category. Love or hate the move, when someone who could have been the next President decides instead to join us as a cleantech VC, you have to feel that's a pretty visible indication of how the stature of the sector has grown. And that's in no small part due to the leadership role Al has already played in raising awareness of climate change and what can be done about it. (I'll admit to being a bit biased -- way back in 1988 I was the only one stumping for Al in my local precinct for the Dem presidential nomination...) Today's news is also a great indication of all of the investor, government, entrepreneurial and corporate efforts that are now going into the invention of the clean energy economy. At the local and regional level, green jobs growth and concerns over issues like water shortages and climate change are prompting a lot of cluster-building efforts and other incentives for cleantech market growth. At the national level, lip-service or not, just about all political candidates are having to make climate change and cleantech a major part of their campaigning strategy. It's becoming clear that January 2009 will be a major turning point in terms of national energy policies. Even the long-maligned idea of a carbon tax is starting to get some momentum behind it, and I thought I'd never live to see that day. So while this particular news item won't make much difference for any VC's day-to-day activity, it's a good chance to take a step back and assess all the exciting changes of the past couple of years. More on the Kleiner/Generations/Gore media love-fest:

• PE Week Wire
• News.com
• NYT
• SF Chronicle
• Merc
• WaPost
• Earth2Tech
• Matt Marshall
• And for the full-on treatment it's worth reading Fortune's articles on the story itself, a profile of David Blood, and a slideshow of Kleiner's greentech portfolio (although it's interesting to note that Fortune includes Glori-Oil, which the KPCB site lists as "other")

In much more pressing and potentially urgent news, however, is today's revelation that threats of presidential veto and other horse-trading could mean that some of the most critically important pieces of the anticipated Energy Bill could be "taken off the table." Welcome to the team, Al, now get to work! Finally, in deal news today, CTI is reporting that Fat Spaniel has taken in $3mm in bridge financing from existing investors, as they look to line up a $20mm Series B.

Enjoyed attending two very strong cleantech conferences over the past few days. The semi-annual Cleantech Venture Forum was, as always, well-attended and a great opportunity to network with peers in the industry. You can see some summaries of the proceedings here, here and here. Prism Solar won the prize for most promising company among the presenters -- later, the company shared with VentureWire that they've raised $6.5mm of their ongoing Series A round (in February we mentioned they'd raised a bit over $2mm to date), with I2BF Venture Capital providing some of the capital. One particularly intriguing session at the Forum was a presentation by member of the "Developer and Platform Evangelism Group" from Microsoft -- for anyone interested in smart building technologies and environmental performance tracking, take careful note that MSFT is now moving into the sector... We also learned that cleantech venture capital took another big jump up in the third quarter in North America, with $1.26B in investments. That was a 36% increase over the third quarter of 2006, and a 50% jump up from Q2 2007. Once again solar and biofuels led the way, apparently. We'll have to revisit these numbers once the details are known -- as always, it's interesting to see how much of the increase is concentrated in a small number of big "venture" deals. Then I had the pleasure of taking part in a venture capital panel at the 3rd Annual Conference on Clean Energy here in Boston. It was a very good showing, demonstrating all the commitment here by the regional government, investment and non-profit communities, toward the development of a strong cleantech cluster. What was quite interesting was the hosting of a parallel Energy Workforce Summit at the same event, illustrating nicely the jobs growth potential that is at the heart of cleantech cluster-building efforts. Gov. Deval Patrick gave a very well-crafted speech on the topic at hand, which was all the more notable for the fact that the Red Sox victory parade was going by right outside the convention center. It worked out very well for everyone who sprinted out the door after the Governor's speech in time to see the "duck boats" drive by with the team members waving and the crowds roaring... Worked out very well for everyone except Peter Girguis of Living Power Systems, who was stuck not only presenting directly after the Governor, but also right at the height of the parade goings-on. So for those of you (like me) who skipped out on Peter's presentation to gawk at Big Papi, do yourself a favor and check out LPS at www.living-power.com, they have a very smart technology with a good potential solution to a lot of off-grid power challenges in both developed and developing economies. Deals from the past week:

• Solar concentrator startup GreenVolts announced a $10mm Series A, led by Greenlight Energy Resources, and including participation by Avista Corporation and other undisclosed investors.

• Lots of talk about Shai Agassi's Project Better Place startup, which has apparently raised a whopping $200mm in financing from a group of investors including Israel Corp., to develop infrastructure for re-charging and support for electric cars. This will be a fascinating one to watch...

• Optimal Technologies International, which is developing supply-side and demand-side systems to optimize (note: not "maximize", which would be entirely different...) the consumption of electricity, raised a tranched $25mm financing from Goldman Sachs ($13mm in the first tranche).

• ImageTree, which has developed land-imagery offerings for monitoring forests (with a variety of potential cleantech-related benefits) has raised a $4.5mm Series B led by Battelle Ventures. PA Early Stage Partners, the West Virginia Jobs Investment Trust Board, the Conservation Fund and Innovation Valley Partners all also participated in the round.

• Last but not least, congrats to the Cleantech Group on their recent investment by Credit Suisse.

• VentureWire is also reporting that SensorTran (full disclosure: note that in the past I briefly served as an observer on their board), which has developed fiber optic technology for temperature, pressure and other sensing, is looking to raise a Series B by year-end.  Kent Kalar, the CEO, told VWire that they have received a term sheet, and that they expect this to be their final round of venture financing.

Cleantech investors in the news:

• Israeli cleantech venture group Terra Venture Partners has raised $15mm of their inaugural fund, and has already made two investments... Meanwhile, also in Israel, Greylock and Israel Cleantech Ventures have formed a joint venture, CleanStart, to provide seed capital and mentoring for startups in the region.

• General Catalyst has closed their fifth fund at $714mm -- the firm invests across a broad range of sectors, but here in Boston, Hemant Taneja has been a driving force behind a lot of the recent cleantech cluster-building efforts in the region.

• Kyoto Planet Asset Management has launched the Kyoto Planet Fund, which will invest in both public and private cleantech businesses.

Other news and notes: Here's a terrific recap of the recent Solar Decathlon... Speaking of solar, Duke Energy wants to buy a solar developer (and there are lots to choose from)... Econometric dorks like myself might appreciate this interesting event study... The California Clean Tech Open winners have been announced, congrats to all... Yikes... And finally, enjoy.

It was a busy week in the world of cleantech investing:

• Mendel Biotechnology, a biofuels feedstock development startup, has raised an undisclosed amount of funding. ZBI Ventures, Capricorn Investment Group, CFM, and Monsanto took part in the round.  More good background here.

• Battelle Ventures and IVP are announcing this morning that they've made co-investments into three cleantech companies: Aldis ($3.7mm Series A in two tranches, with Meritus Ventures also participating), a provider of technology for energy-efficient traffic lights; Ampulse, an early-stage thin film PV startup ($1mm of "pre-seed"); and Planar Energy Devices, a developer of thin-film batteries ($4mm in tranched Series A).

• Stonybrook Water Purification has raised a $4.1mm Series A round, led by Battery Ventures, and including participation by T2VC, Modern Water, and TianDi Growth Capital.  PEWW reported on the deal a while back based upon a regulatory finding.

• UK-based Green Biologics, an early-stage bio-butanol startup, has raised a GBP 1.58mm Series A.  Carbon Trust Investments and Oxford Capital Partners led the round, which also included existing investors.

• GridPoint increased their Series D round by $16.5mm, to $38mm.  New investors in the round appear to include Susquehanna Private Equity Investments, NEA, Perella Weinberg Partners, and Robeco.

• Weather-damage insurance startup WeatherBill has raised a $12.5mm Series A round, from NEA, Index Ventures, Allen & Company, Atomico Investments, Sean Park, and First Round Capital.

• PE Hub scooped that BioFuelBox (biofuel refining in a box) has raised $9.46mm in Series A financing, from DFJ and DFJ Element.

• Silicon slurry and refining startup SiC Processing AG has raised a EUR 53mm round of financing, led by zouk ventures, and including Merrill Lynch Corporate Principal Investments, CC Private Equity Partners, Masdar Clean Tech Fund, Foursome Investments, existing investors and the Heckmann Family.

• Synapsense has brought in Sequoia to their Series B, increasing the size of the round to $11mm.

• Jonathan Shieber at VWire reported that Solix Biofuels, an algal biodiesel startup, has raised $1.5mm of a $3.5mm round of financing, according to a regulatory filing.  Bohemian Investments is one of the backers.

• Shieber also reported that daylighting startup Ciralight has raised $1.5mm in angel financing.

• Cleantech investors in the news:  Chevron has upped their commitment to Chevron Technology Ventures by $75mm, with about 1/3rd of that directed to cleantech...  And Sitra and Provider Venture Partners are launching a EUR 100-160mm investment fund targeted at Nordic cleantech enterprises.

Other news and notes:  Here's an entertaining list of the "top 10 cleantech jobs" -- just don't bet the ol' corn farm on being able to break into that number one job...  Here's a useful ethanol report from Guinness Atkinson (note: link opens pdf)...  Finally, these pictures are really cool.

Meir Ukeles of Israel Cleantech Ventures has been busy lately, but he still found time to write the following update on how hot things have been over there lately (thanks, Meir!):

On October 30, Israel will host a cleantech conference cosponsored by the Cleantech Venture Network, Ernst & Young, Morrison & Foerster, and my firm Israel Cleantech Ventures, as part of the larger WATEC water technologies week event. Ahead of this event, here are a few thoughts on why Israel is emerging as an important hub of cleantech innovation.

Fueled by acute constraints in natural resources, Israel has spawned a number of successful water technology and alternative energy companies, including recognized names in drip irrigation (Netafim), desalination (IDE), geothermal energy (Ormat), fuel cells (Medis), and solar thermal energy (Solel/Luz). These successes, a wave of immigration from the former Soviet Union, and the inherent strength of Israel’s academic institutions in these areas have led to world class cleantech capabilities and more than 350 active cleantech companies in Israel today. The roots of this growing community of cleantech entrepreneurs can be traced to (1) established or “legacy� industrial companies active in energy, water, chemicals etc., (2) academic institutions with long histories as research leaders in energy and water sciences, and (3) “crossover� initiatives or entrepreneurs moving into cleantech from traditional areas of Israeli technology leadership such as power electronics, semiconductors, and even biotech and agritech.

Many of the ‘startups’ that are emerging from the first two constituencies are the fruits of years or decades of research in industry or academia, that now feel the pull of markets actively seeking technological solutions. We are also seeing a growing stream of ‘crossover’ serial entrepreneurs launching their newest companies in the cleantech fields, motivated not by a desire to the planet, but rather by a conviction that these markets offer opportunities that dwarf those of enterprise software or semiconductors. As just a small snapshot of what’s happening in this respect, we’ve seen founders or key members of some of the most recognized names in Israel’s high tech world (Checkpoint, Comverse, Chromatis, Scitex, and many others) now involved in launching cleantech companies.

Israeli cleantech companies must overcome the same challenges faced by counterparts in other countries, including the challenge of penetrating often risk-averse customers in the energy and water markets, managing cash burn rates against long sales and adoption cycles, etc. However, Israeli companies do operate under some unique constraints, starting with their distance from and historical lack of familiarity with many of the key customers and channel partners for their products and technologies. Just as an earlier generation of Israeli entrepreneurs had to learn the hard way how to partner with and sell to Cisco, Nortel, IBM and Microsoft, the cleantech entrepreneur must learn to navigate and fill critical technology gaps for GE, Siemens, Sunpower, Alsthom or ABB.

On the positive side, Israeli companies have a number of factors working in their favor. The global nature of the water and energy opportunity plays to the strengths of Israeli entrepreneurs that seem equally comfortable pursuing business in New Delhi as they are in New York. Israeli companies also benefit from the existence and effectiveness of a number of entities that have emerged as key enablers, including Israel’s national water company, Mekorot, the BIRD (Israel-U.S. Binational R&D) Foundation, and the Ministry of National Infrastructure which is working on development of domestic incentive programs for alternative energy modeled on precedents like the German EEG.

When speaking with investors and other funds outside of Israel, we are frequently asked what we see as the most attractive niches in the Israeli cleantech landscape. There are a number of areas in which we have seen a greater quantity and quality of companies emerge in Israel, including a broad spectrum of water efficiency, quality and treatment technologies, power electronics and energy storage, as well as some aspects of solar energy. However, the simple truth is that Israel’s most important resource is its entrepreneurs – a seemingly inexhaustible supply of talented business people and technologists who excel at looking beyond traditional ways of solving market problems and inefficiencies. That, coupled with the truly colossal demand for technologies to address the world’s insatiable need for clean, accessible energy, water and air, is what is already putting Israel on the map as a global cleantech player.

Cleantech deals over the past week:

• Dan Primack reported on Monday that ZeroPoint Clean Tech, a developer of biomass gasification technologies, has raised a $3.12mm Series B.  Investors weren't disclosed.

•  LedEngin, a developer of LED packaging solutions for solid state lighting, has raised an $11mm Series C.  The round was led by Partech International, and previous investors WK Technology Fund and individual investor Dr. Lu also participated.

• Water management darling HydroPoint topped off their Series C round with an undisclosed additional amount of funding by Citi Alternative Investments.

•  Nordic Windpower has taken in a "significant investment" from Goldman Sachs.

• Is it a venture deal?  Unclear.  But wind developer EverPower took in $55mm from Good Energies.  Interesting to note the mention of Good Energies having a longer investment horizon than most venture capital firms.

Cleantech investors in the news:

• Tyler reports on the launch of the Canadian Cleantech Fund.

•  Belgian VC Capricorn Venture Partners has raised EUR 50mm so far for their Capricorn Cleantech Fund, with hopes to make a final close at EUR 75-100mm.

• Braemar Energy Ventures has closed on their second fund at $250mm.

• GreenTech Media has the scoop that Mark Huang appears to be leaving GE's cleantech investing team.

• Cleantech (and especially the venture capital community) should have more women managers and investors.  Here's a good list of 10 of the better known members of what is currently a very small club.  Of course, Lauren Bigelow of the Cleantech Network really should have been on the list as well -- here's a good recent column by Lauren on corporate cleantech activity.

Update on the New England cleantech cluster:  Here's a good interview with Massachusett's Ian Bowles on the state's efforts to promote decoupling and other important energy policy changes.  It's clear that there's a lot of momentum in Massachusetts and around New England to promote the faster development of a strong clean energy economy -- and as this article illustrates, cleantech can be an important driver of jobs growth.  That's why it's very encouraging to sense the state moving quickly beyond basic rhetoric toward real action. Other news and notes:  Good venture exit trends across all categories...  It's shameless promotion of an @Ventures portfolio company, but besides that this is a great article on the problems of biodiesel availability at the retail level...  Jennifer Kho notes that demand response and energy management is in a rapid-consolidation phase...  Here are a couple of interesting analyses on energy generation technologies and transportation fuel choices...  Neal writes some interesting thoughts on hybrids and the electric car...  Finally, they're going to be using Grey's Anatomy to measure energy use?

The big news today is GreatPoint Energy's big financing, as has been reported by VentureWire, PE Hub and others (Earth2Tech has a blurb here). As reported by Jonathan Shieber at VWire, the $100mm round has been led by new strategic investors Citi Sustainable Development Investments and Dow Chemical. Other strategic investors AES and Suncor Energy also participated, along with previous investors (which could therefore include ATV, Kleiner, Khosla, DFJ, and the founders' own GreatPoint Ventures, from a previous $37mm round). It's a great example of how interested venture investors and energy giants are in the potential for coal gasification technologies. Other deals:

• Biofuel developer Amyris Biotechnologies has announced the completion of a first tranche of a $70mm Series B. DAG Ventures led the round, which also included previous investors Kleiner, Khosla and TPG Ventures. The funding is intended to help the company come to market in 2010 with biodiesel, biogasoline and biojet fuel.  GTM's Rachel Barron has more information about the financing, and as well as Solazyme's debt financing.  Shieber reported on Tuesday that the pre-money on the round was $400mm, and also adds that competitor Synthetic Genomics had previously raised a Series B round of financing from BP and others at a $300mm post-money.  Wow.

• Thin-film solar moves by big corporates:  GE has taken a minority stake in Primestar.  And meanwhile, in Germany Schuco and E.On are forming a joint venture (with $135mm in financing) to launch Malibu, a thin-film manufacturing effort using Applied Materials production equipment.  Feels like the thin-film market is finally poised for some major moves forward...

• Solar Power Partners, a solar PPA developer, has raised a $6mm Series A led by Globespan.  The company has 14MW worth of signed projects to date.

• Danish ammonia-storage technology developer Amminex A/S announced an approx. $7mm Series C (note: link opens pdf), led by Conduit Ventures and including SEED Capital K/S.

Cleantech investors in the news:  When Sevin Rosen pulled out of fundraising their tenth fund a year ago, they broadcast the message that the venture capital model was broken.  Now VWire reports they're re-launching fundraising, but "opening the aperture" to go later stage, and to move "beyond technology investments" (sic) into healthcare and -- relevant to cleantech investors -- energy.  It's an interesting development on one of the most pointed internal critiques of the venture capital industry, and in a small way also points to the way cleantech is getting more generalist VC mindshare these days.