Green Builder Zeta Communities Gets Funding

Zeta Communities, which wants to build inexpensive, modular homes, has just landed a round of funding and is working on its first prototype, according to chairman Marc Porat.

The company has been working on a 17-unit townhome development in San Francisco that it hopes will cost $165 a square foot to build, cheap for around here. Investors include Northpoint Capital. The company is run by Porat’s sister Naomi.

Entrepreneurs have touted green buildings and building products for the past few years, but the momentum finally seems to be peaking. Michelle Kaufmann Designs a few months ago landed a round of funding, according to sources. SG Blocks showed off a home made from old shipping containers at West Coast Green recently. (You read the article—now see the film!) A VC firm, Navitas Capital, was formed specifically to put money into green building companies. Meanwhile, product companies like Integrity Block and CalStar Cement (founded by Marc Porat) have attracted investors too.

What is driving it? For one thing, VCs have probably become exhausted flinging millions of dollars into solar and biofuel deals. That’s just got to get dull after a while. Second, investors are paying more attention to efficiency plays: companies that can cut demand for electricity. It is far easier to cut electricity consumption after all than produce it in a green manner. If you talk to utility execs, nearly every conversation begins with efficiency.

Buildings consume 51 percent of the energy in the U.S.; 39 percent of the energy in the U.S. goes to run air conditioners, lights and other systems while 12 percent gets consumed in constructions. Air conditioning and heating accounts for 16 percent of the total energy consumed annually in this country.