Winds of Change
By Alidad Vakili (San Diego)
By many accounts, there appears to be a shift in the winds that have for the past several years kept many an investor on the sidelines. Although the economy has not recovered anywhere near its height in 2007, the winds of change are slowly being felt throughout the country. The 4th quarter of 2010 brought with it more deals…more mergers, acquisitions, private equity transactions, etc. and indications are that this upwards trend is likely to continue.
All this increased activity seems to be ushering in a sense of better times ahead for many an industry. The cleantech sector also appears to be getting a bit of a boost from the recovering economy. More and more companies, at all stages of the business life cycle, are keeping a watchful eye on cleantech and not a few are investing in new and better technologies and business ventures (e.g., solar energy, wind energy, biofuels, battery technology, carbon capture, etc.). The number of global cleantech mergers and acquisitions and initial public offerings have increased in recent months with the retail investors' penchant for publicly traded cleantech businesses increasing over the past several months[1].
According to the National Venture Capital Association, significant activity was noted in the cleantech sector with an increase in 2010 with $3.7 billion invested in 267 deals, a 76% increase in dollars and a 37% increase in deals, an increase from 2009 in both dollars and deal volume from $2.1 billion and 195 deals, respectively[2]. This heightened activity represents the first annual increase since 2007[3].
This renewed sense of tempered optimism is not relegated to the private sector alone. The federal government also appears to be focusing more attention on clean technology. In his January 25, 2011 State of the Union address, President Obama signaled a higher priority to be placed on energy efficient and renewable technologies and energy measures[4]. There is still a long way to go, but for this relatively nascent industry, the future looks particularly promising as more emphasis and priority are being placed on the environment by the government, as well as the public and private sectors.
[1] 2010 Cleantech Venture Investments Second Highest On Record, Sustainable Business.com, January 10, 2011.
[2] Annual Venture Investment Increases for First Time Since 2007, According to the Money Tree Report, January 21, 2011.
[3] Cleantech, Electronics Venture Funding Jump in 2010, Science Business, January 24, 2011.
[4] Barak Obama’s State of the Union Address; www.greenbiz.com, citing an article by Leanne Tobias published on January 27, 2011 titled, “The State of the Union, Green Business and the ‘Harmony’ Paradigm. See also an article by Lindsay Morris titled, “What is “Clean Energy,” President Obama?” published by www.renewableenergyworld.com on January 26, 2011.
