Cleantech Venture Capitalists ‘Re-Energized’ as Investment Picks Up

President Obama’s climate speech has given a boost to the cleantech industry, says the Cleantech Group, as it releases data showing venture capital investments in the sector up more than half for the second quarter (Q2). 

Figures for Q2 2013 shows venture capital investments are up 56% globally to $1.76 billion, compared with the first three months of the year.

“President Obama’s climate action address has reenergized the cleantech industry, and our i3 data—in addition to the strong performance of SolarCity and Tesla — underscores our belief that we are turning a corner,” says Sheeraz Haji, CEO of Cleantech Group. “Recent acquisitions of Waze, Power-One and ecoATM provide further reason for optimism, and the breadth of private companies generating material revenue is impressive. Alongside these trends, we continue to track increased activity by large corporates. Indeed, the tide appears to be turning in 2013.”

North America accounts for 71% of the quarter’s venture investments, with cleantech companies attracting $1.25 billion – up 74% quarter-on-quarter. Europe and Israel account for 13%, and Asia Pacific for 15%. 

Broken down by sector, Energy Efficiency continues its lead in terms of the amount invested ($378 million) and in the number of deals (45 funding rounds).

Other leading cleantech sectors are Biofuels & Biochemicals ($231 million) and Solar ($170 million). 

The largest transactions for the second quarter: 

• Bloom Energy (California) fuel cell manufacturer – $150 million from Credit Suisse and E.ON.
• Intrexon (California) synthetic biology technology – $150 million from Third Security and company CEO Randall J. Kirk.
• Skyonic (Texas) CO2 mineralization technology for industrial carbon capture and reuse – $128 million from BP Ventures, Cenovus Energy, ConocoPhillips, Energy Technology Ventures, and others. 
• Xiangtan Electric Manufacturing (XEMC- China) makes efficient drivetrain components for wind turbines and internal combustion engines – $112 million from Hunan Hi-Venture Capital.
• Hefei Golden Sun Energy Technology (China) solar developer – $69.5 million from Jiangsu Akcome Solar Science & Technology.
• Blu Homes (Massachusetts) $65 million for greenbuilding technology from Brightpath Capital Partners and Skagen Group.
• View (California) $60 million for dynamic glass technology from Corning, General Electric, and Khosla Ventures.
• Lyft (California) $60 million for this peer-to-peer taxi service from Andreessen Horowitz;
• Aligned Energy (Connecticut) joint-venture between  Skanska and Inertech for energy-efficient modular data centers and cooling technology, raised $59.8 million from Inertech, Skanska, and One Equity Partners.

Notable acquisitions include Google’s $1.3 billion purchase of Waze, an Israeli/ California-based startup that uses crowd-sourcing to monitor traffic conditions; and ABB’s $1 billion acquisition of Power-One, a leading solar power inverter manufacturer also based in California.   

Totals still down

Hopefully this uptrend will continue. Besides being an improvement from Q1 2013, the second quarter is also slightly better than the same period last year – when $1.6 billion was invested.

Venture capital investments in cleantech hit their highs in the third quarter of 2008 – right before the financial crash – when  more than $3 billion was committed. Last year, just $6.46 billion was invested, down 33%.