Recent Posts:

XsunX gets a $10.85M commitment

Rob Day: July 27, 2005, 2:29 PM
Publicly-traded XsunX has announced a PIPE funding from Cornell Capital, LP. The funding is in the form of a $10M "standby equity distribution agreement" for tranched funding as needed over 24 months, and $850K of convertible debentures. XsunX appears to be pre-revenue, and is developing BIPV specifically for glass windows.

Wednesday tidbits: Prism Solar, NCSRT, Mid-Atlantic Biodiesel, etc.

Rob Day: July 27, 2005, 1:53 PM
Some items of note from recent news:
  • Prism Solar has taken in $400K in seed stage funding from investors including Counter Point Ventures. More details on Prism Solar's founding and plans are available here. The company plans to start production in 2006, for their solar concentrator technology.
  • Vantage Point Venture Partners' New Energy Capital has led a $10M investment into Mid-Atlantic Biodiesel, as mentioned in today's PE Week Wire. Interesting blurb in the PEWW about cleantech interest in general, worth checking out. Greater Atlantic Bank is providing debt financing for the deal (more details available here for those interested). There is a lot of project finance activity in biodiesel these days, but (with some notable exceptions) less so in VC.

"How do I get a job in cleantech?"

Rob Day: July 26, 2005, 6:36 PM
"It's clear that the energy sector is ramping up. Do you have any advice for me as I look to transition into the industry?"
This question and its many variants are posed quite often... People recognize the momentum that clean technologies, and in particular energy technologies, appear to be gaining, and they want to figure out how to get in.

So I wanted to take the opportunity to pass on the answers I usually give to such job-seekers, in case it's helpful. This advice is pretty basic; there are no one-size-fits-all solutions for job seekers, and luck always plays a huge factor in any job search. But below are my thoughts, limited insights, and good links for those looking for a new job in cleantech:
  • Understand that it is not going to be easy to find a job in clean technologies right now. While the industry is growing quickly, interest among job seekers seems to be growing even faster. So plan your strategy accordingly: Cast your net wide, be patient, chase all leads that have potential, and hone your pitch well. You should also make sure that this is really the direction you want to go...
  • Know what role you want to play. I often ask people, "are you a strong sales professional, an engineer with specifically relevant training, or a financial professional with a proven track record of driving transactions?" Right now in the industry, most of the available jobs seem to fall pretty clearly into one of these three categories. And yet often the response I get is unsure, vaguely defined, and often described as something along the lines of strategy, high-level marketing or business development. There aren't a lot of these kind of jobs out there. Aside from the initial senior management team, startups need to do three things: designing products, making products, and selling product. Investment shops need one thing: deal-makers. And larger firms are often not any less silo'd. In the future, you will probably see more jobs open up in manufacturing/ operations leadership, but again that requires specific training and experience.
  • If you have the means, be willing to work on a contract basis, for little or no compensation, in order to get your foot in the door. Many people I know who have succeeded in breaking into the cleantech industry did so by consulting part-time, or doing projects on spec, and thus proving their capabilities and worth. Also consider: What does this point tell you about likely compensation even for full-time employees in the industry?
  • Broaden your horizons beyond energy generation technologies. Many people want to get a job in solar, or fuel cells, or other high-profile industry segments. But many of the best jobs will actually be found in energy efficiency, in clean water technologies, in clean manufacturing, etc.
  • If you can, be willing to relocate. Some may disagree, but there isn't strong clustering in clean technologies, at least as compared to other technology industries such as software, and at least not yet. Some areas are better than others (the Bay Area, the Boston area, the Pacific Northwest, to name a few), but if you want to maximize your chances, look wide and far. Some of the best opportunities are in Michigan, Wisconsin, Florida, Arizona, Kansas, etc.
  • Network, network, network. Find a local cleantech-related professional networking organization (for example, here in the Bay Area there is the Renewable Energy Business Network - REBN), attend cleantech-related events, and make contact with people that you know who are already involved in the industry and can keep an eye out for opportunities that may fit you. Most jobs and consulting opportunities will come to you through someone else, who happened to know you were looking, and knew your general background and preferred role.
  • Watch this space and other sources (some links are provided on the right) to see what companies have recently gotten funding -- they're the ones most likely to be hiring soon.
Here are some links that might be useful:
Last, but not least, good luck!

Some recent moves in solar

Rob Day: July 25, 2005, 8:08 PM
Solar continues to make headlines:
  • Speaking of thin film solar (here, here, here and here), CleanEdge has passed on a recent announcement that Sharp is opening up a new thin-film solar manufacturing plant. The plant will have capacity to produce 15MW of solar cells. This kind of activity by the big players can be both good and bad for the smaller companies in the space, depending upon their go-to-market and exit strategy...
  • Solar concentrator technology appears to be reasserting itself, with the recent news announced at an NREL and Arizona Public Service conference that costs below $3 per peak watt are "imminent". To put that in perspective, with some basic assumptions about solar exposure, etc. in place, $3 per peak watt would equate to power at a cost of around 5 cents per kWh, which would be (very) roughly competitive with wind, coal and natural gas power. However, it's unclear from the press release whether the $3 per peak watt estimate includes installation, balance of plant, storage, etc., or if it's just an estimate of the cost of the concentrator module itself -- in which case the additional costs can make a big difference.

The biodiesel/ ethanol debate is heating up: What should investors conclude?

Rob Day: July 20, 2005, 8:19 PM
Cleantech investors have been watching with interest in recent days as the debate over the "net energy benefit" of plant-based fuels such as ethanol and biodiesel has heated up.

A couple of weeks ago, researchers at Cornell and UC-Berkeley released a report in which they concluded that "there is just no energy benefit to using plant biomass for liquid fuel... These strategies are not sustainable." The researchers examined ethanol production from corn, switchgrass and wood biomass, and biodiesel from soybeans and sunflower, and concluded that in every case it requires more fossil fuel-based energy to make the fuel than the fuel itself then carries -- a net negative energy benefit. Thus, the researchers conclude, agriculture-based ethanol doesn't make sense.

Coming as it did in the midst of a legislative battle over an energy bill, in which significant subsidies are at stake, the response (particularly in corn-growing regions) has been predictably swift and forceful. Newspaper and journal editors have attacked the study (reg. req'd for link), ethanol producers have cited other studies that reached different conclusions, and lobbyists and politicians have also had their say.

This study and the ensuing public debate has been confusing for cleantech investors. The cleantech investing strategy is about backing efficient technologies ahead of looming resource trends, and for many this study throws into doubt that ethanol and biodiesel are just such efficient technologies. But the counterarguments are also equally compelling, and it is hard for observers to gain clarity on the issue. Especially as investors have recently backed biodiesel and related technologies, I've heard a lot of questions about the report being asked by both investors already involved in cleantech and those still taking a look at the industry.

This site is not a venue for weighing in on such a debate on either the science or political issues. But there are several things that cleantech investors should keep in mind as they watch the action unfold:
  • First and foremost, this is a political debate. While science is being used, both the pro-ethanol and anti-ethanol scientists and pundits who wrote the controversial report and the above linked columns are clearly motivated in some not-insignificant way by a desire to influence the current energy bill efforts. As one of the report's authors (Pimentel) says, "The government spends more than $3 billion a year to subsidize ethanol production when it does not provide a net energy balance or gain, is not a renewable energy source or an economical fuel." Subsidies are clearly uppermost in this researcher's mind. Investors need to view both sides' arguments with a grain of salt given this dynamic.
  • While this report was released recently, it is just the latest in a long-running set of similar reports and studies. Here's an example of a 1995 study with some of the same factors and calculations, and these same types of studies have been coming for years before this one, on both sides of the debate. (Here's another link to the same study that purports to juxtapose some of Pimentel's results, for those curious, but I cannot vouch for the trustworthiness of this site, or the source of their figures and comments, so take it as you will). Investors shouldn't think that the recent uproar is a result of significantly new information.
  • Regardless of the ultimate truth about the net energy benefit of liquid fuels as derived by those crops and processes covered by the recent report, there are a lot of other potential sources of biomass for biofuels that are very different. The Pimentel report appears to study only a few selected fuels for which crops were specifically raised. However, in recent years investors have backed biodiesel-related startups that use waste food grease, agricultural waste, and even emissions-fed algae as biomass. Biofuels sourced from such wastes may very well be more efficient than fuels from crops grown solely for the purpose. Investors shouldn't draw too many far-reaching conclusions about the use of biofuels in general from these specific studies.
In short, there is a lot of noise right now about the value of biofuels, but the debate is not new, is often influenced on both sides by political factors, and is built around a narrow scope of technologies. Cleantech investors shouldn't let the current debate confuse them or otherwise affect their existing point of view -- whatever it may be -- about the investibility of biodiesel and ethanol technologies.

Wednesday tidbits

Rob Day: July 20, 2005, 12:40 PM
Here are a few recent news items of potential interest:
  • Another "introduction to cleantech investing" article, this time by SNL Interactive. Some good quotes by Keith Raab at the Cleantech Venture Network, and an interesting investment criteria checklist from GE Energy Financial Services. A decent overview, although it would have been nice if they had also listed Expansion Capital Partners among those active in the space, of course... A strong list and good article nonetheless.
  • Here's an interesting blurb on recent advancements in small-scale wind turbines. As the electricity grid gets more decentralized and distributed generation becomes more prevalent, there will be a lot of technology options at play for small-scale generation. Solar is currently taking off, some are betting heavily on solid oxide fuel cells and similar technologies, microturbines have gotten some attention, and it's always interesting to hear about more such potential technologies such as micro-wind. Put this one in the "on the distant horizon" file...