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Posts Tagged ‘Cleantech investments’

Here is an article from Venture Capital Dispatch.

“The latest sign of a shakeout in the clean-technology sector is news that battery company Firefly Energy Inc. is shutting down after failing to raise a $20 million round of fresh capital. VentureWire has the story. The company, whose backers include cleantech powerhouse Khosla Ventures, developed a technology for replacing conventional lead plates in batteries with carbon-based foam. Expect more such stories as companies that raised capital when VC enthusiasm for cleantech was boundless find that the bar is now much higher.

Venture capitalists can keep breathing easy on the regulatory front as the latest effort to rein in the financial industry largely exempts them. Revised legislation submitted by Senate Banking Committee Chairman Chris Dodd, a Connecticut Democrat, requires hedge funds with more than $100 million of assets under management to register with regulators, but still exempts private equity and venture funds, VentureWire reports. Of course the game isn’t over yet, but Dodd’s bill is easier on private equity than the House and Obama administration versions and, as anyone following the health-care debate knows, crafting a bill that can pass muster in the Senate is the hardest battle.

Across the Atlantic, similar regulatory matters continue to provoke controversy, as European finance ministers delay plans to vote on a directive regulating hedge funds, private equity and venture capital investment. The proposal has the potential to decimate the venture capital industry in the European Union, critics say.”

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Here is an interresting CleanTech article from LA Times business blog.

“The number and value of green-tech mergers, acquisitions and capital raises in the U.S. dropped in 2009, according to a new report.

Overall, there were 248 deals — 188 capital raises and 60 acquisitions — worth a total of $9.5 billion, according to New York-based investment bank Peachtree Green Advisors. The volume of transactions was down 14% from the 289 deals recorded in 2008, and the value dropped 4% from the $9.9 billion that year.

The distribution, storage and efficiency sector had the most transactions, with 90, or 36% of the aggregate. Biofuels saw the steepest decline, with just 27 deals in 2009, compared with 69 in 2008.

The wind industry had deals with the highest value, a combined $3.1 billion, or 32% of the total transaction dollars from 2009. The amount was more than a billion dollars higher than the 2008 total, a 52% boost.

With $2.1 billion, or 22% of the total, the distribution, storage and efficiency sector came in next. The solar and bio sectors each represented 20%.

Deal value in the solar category plunged to $1.9 billion from $3.5 billion in 2008, in part because of the recession, the cost of developing utility-scale solar farms, tight credit and investor concerns.

And capital investment in solar slid 62%, to $1.2 billion from $3.2 billion, while volume fell 31%, to 47 deals from 68. The amount of funding funneled into the wind industry saw an “astounding” 907% upswing to $2.3 billion from $224 million the year before, when there was tightening credit, declining prices for natural gas and oil and the upcoming presidential election, according to Peachtree.

Across all sectors, the overall declines were offset by huge bundles of funding — more than $30 billion to be used in 2009 and beyond — from the Department of Energy through the American Recovery and Reinvestment Act, according to Peachtree.”

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Here is an article from earth2tech.

“Will 2010 be the year for greentech IPOs? When lithium ion battery maker A123Systems successfully debuted on the Nasdaq back in September, there was much speculation that the move would ready the market for a following of greentech IPOs. The notion seemed over-enthusiastic then, but three months later solar power startup Solyndra has registered for an IPO, which will likely happen in 2010, and we’ve heard rumors that Tesla is plugging away at its S-1 (Reuters also reported an upcoming Tesla IPO).

Then there’s Silver Spring Networks, which just raised $100 million and looks like it’s getting to that stage where it’s too big to be acquired but will need more financing to compete in the smart grid infrastructure market. Silver Spring isn’t commenting on any IPO rumors, but it is clearly one of the best candidates in the greentech world. If these three — Solyndra, Silver Spring and Tesla — do go public in 2010, it’ll make investor Steve Westly look like a pretty solid market forecaster — he predicted in May that these three would go public by early 2010 and he’s already good for one out of the three.

Out of any of the venture capital investment sectors, greentech has the most bullish outlook in 2010 from a VC standpoint. According the National Venture Capital Association, more than half of a group of venture capitalists surveyed predicted that clean technology would see higher investment levels in 2010. According to a report by PricewaterhouseCoopers, venture capital investing in cleantech already rebounded sharply in the third quarter of 2009 to $898 million in 57 deals, up from $475 million in 49 deals in the second quarter of 2009.

The IPO market in general is also looking better to VCs. VCs surveyed by the NVCA are predicting “a mild improvement” in the number of venture-backed IPOs overall in 2010, with 74 percent of respondents saying they think there will be more than 20 IPOs in 2010. However, according to this Reuters article, greentech companies’ offerings represented only a small portion of the overall U.S. IPO market in 2009, ranking fifth by dollars raised in 2009 in the IPO market, and accountng for 8.5 percent of issuance by companies going public in 2009.”

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Here is an interesting article from Greentech Media.

“A few months ago, we wrote a list of the ten most likely companies to be bought in the near future with a list of five that would never get bought. (Greenfuel Technologies, one of the top candidates for not being sold, ceased operations the next day. Greenbox, bought by Silver Spring Networks last week, was listed as a possible impulse buy in smart grid.)

But who is going to buy? Here are the main ones. The list is based on stated strategies, company histories, current market circumstances and gut feelings. In other words, pure science.

1. General Electric: GE likes to shop. It got into wind by buying Enron’s wind division in 2002 and since then has invested in, or bought, companies like Southwest WindPower and ScanWind. GE now battles Vestas for the top spot in wind.

A similar trajectory occurred in water. It entered the water industry by purchasing Glegg in 1999 and then followed up with BetzDearborn and Osmonics. GE’s water group is now a $2.5 billion plus operation with long-term goals to hit $10 billion.

GE’s latest obsessions are smart grid, energy storage, and components and software for energy efficient buildings. In all, GE has bought 717 companies and invested in 236, according to this site. With energy as the company’s future, the wallet will be open.

2. Siemens: The German GE. Expect to see a lot of emphasis on energy services, water, smart grid, energy efficient components, wind and equipment for building biofuel refineries.  In August, it purchased majority shares in two Chinese circuit breaker makers.

3. Applied Materials: Applied is the world’s largest manufacturer of semiconductor manufacturing equipment and acquisitions are simply a way of life. Startups simply can’t achieve the scale they need to become commercial and the established companies don’t have the R&D to spread around to try out every single idea. In a sense, the equipment business is really America’s Got Talent for the vapor deposition crowd.

Applied entered the solar market with its purchase of Germany’s Applied Films for $464 million in 2006. It hasn’t been dreamy: many analysts believe amorphous silicon, the kind Applied’s equipment is geared toward, will become marginalized. But it probably won’t close the wallet. Last year, Applied started to quietly lay plans to get into the market for manufacturing equipment for batteries and energy efficient lights. Applied’s VC arm has also invested in a wide variety of companies. Some companies that may go into its maw: Solaicx (ingots – it already invested in Solaicx), Plextronics (printable circuits) Kateeva (novel OLED tools) and something in CIGS.

4. Taiwan Semiconductor Manufacturing Co.: Back in the mid-1980s, investors told Morris Chang that his idea of building a chip factory for hire was nuts. Since then, TSMC has become the world’s largest foundry, pulling in billions a year. In August, Chang came back as CEO, announced that TSMC wants to get into LED lights and solar panels, and would likely buy companies. Asian conglomerates, in fact, will be some of the biggest buyers in the coming years. The company is known for relentless manufacturing expertise and a highly competitive culture, like First Solar and Intel. VCs have told us that TSMC’s VC unit is already in the Valley armed with a spread sheet detailing markets it would like to participate in. UMC, the little brother rival of TSMC, has launched similar plans. TSMC and UMC could also become factories-for-hire in solar.

5. Valero: Take a look at this chart. Valero doesn’t go for those mega-mergers, like Chevron and Texaco. Instead, it buys lots of small items. And it’s aggressive. Think of it. Seven years ago, you never saw a Valero station. Now they are a common site. This year it bought seven ethanol plants from VeraSun for nearly $500 million and several other ethanol producers want to offload facilities. If some companies can start to show cellulosic ethanol or algae fuel can scale, there is a good chance Valero will show up with a checkbook first. Chevron, BP and ExxonMobil by contrast seem more intent on forming research alliances with biofuel startups.

6. Toshiba: Batteries, flash memory, computer components, advanced materials, televisions: these are some of the green markets the 150-year old company is in. Toshiba officials said recently that it may need to start buying companies in LEDs to increase its market share. Whether by Toshiba or not, LED startups will likely begin to get snapped up in any event: it’s a growing market with high capital costs. Some would-be purchases: Luminus Devices, Bridgelux and Renaissance Lighting).

7. Philips: The same arguments that apply on Toshiba largely apply here, but in LEDs it will likely focus more on lighting fixtures than the light sources, which are semiconductors. It has already bought two companies this year-Teletrol (light fixtures) and Dynalight (controls). Between 2005 and 2007 it bought $5.4 billion worth of lighting companies.

8. Cisco Systems: Not a lot of explanation needed. Cisco wants to deploy its routers and software to control the power consumed by phones, PCs and servers and later the grid, homes and commercial buildings. Just as important, the company has a history of buying lots of companies and actually making the acquisitions work. Possible Cisco buys: Verdiem, Hara, EPS (energy optimization for dairies-very interesting) Optimum Energy, Other buyers in this market: Oracle and SAP. Another plus: Cisco tends to pay higher prices than conglomerates like Siemens, according to Dave Dreesen of Battery Ventures.

9. IBM and Intel: Smart grid and energy efficient computing. Intel periodically goes through acquisition binges. Between 1999 and 2003, Intel bought 37 companies for $11 billion, most of them in communications. Later, most of them were sold off. Did that cure Intel of buying? No way, it got into consumer electronics a few years later. It has begun to plant its processors into wind turbines and smart grid equipment. Intel lately has discussed how digital technology could revolutionize building management and smart grid. History makes me think that someone like Tendril or Lumenergi could be an Intel company.

IBM gobbles up companies too. Side note: IBM has nearly 398,455 employees and $106 billion in revenue. There are probably start-ups that IBM has bought and forgot they owned.

10. SunPower: Also a top ten acquisition target. SunPower faces pressure from both directions: China’s Suntech Power Holdings is moving up into the high efficiency panel market SunPower created and while First Solar is setting a low, attractive price for solar nearly everywhere. Thus, like nearly every other solar maker, SunPower will need to diversify. It has been advertising like crazy to make itself a consumer brand so perhaps it will buy an installer, someone doing a solar appliance (thermal, light and PV all in one) or one of the companies doing software for remote solar estimates like Sungevity or Global Solar Center. A BIPV company is another possibility. It has a history in acquisitions with the purchases of PowerLight and Solar Solutions.”

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Here is some cleantech news from Cleantech.

“An Azusa, Calif.-based advanced battery company looks to close $27M, ClearEdge Power brings in $15M and stealthy Khosla-backed Seeo raises $8.6M.

CFX Battery expects to have $27 million in the bank in the next 60 days, but the company is still keeping specifics of what it is doing on the quiet side.

The Azusa, Calif.-based advanced battery company’s CEO Joe Fisher told the Cleantech Group today that his company has secured $5 million of its $27 million Series B round, without disclosing investors.

The announcement was among at least three cleantech companies that secured venture capital financing today, according to regulatory filings. CFX would be the largest if it brings in the $27 million, which Fisher is confident it should be able to do quickly. He said the company is also open to new investors.

The company plans to use the funds to continue to advance its research and development, for manufacturing equipment as it scales up to production, for working capital related to the equipment, and potential acquisitions in the battery space, Fisher said.

“We’re looking for niche-type smaller companies that have good intellectual property and potential to fit into our portfolio,” he said.

Other funding announcements today included fuel cell micro-combined heat and power (CHP) generation system developer ClearEdge Power raising $15 million in its fifth round of financing. And Berkeley, Calif.-based Seeo, a Khosla Ventures-backed company, raised more than $8.6 million in new venture capital financing (see Khosla-backed Coskata, EcoMotors come out of stealth and Stealthy Khosla-backed battery startup driving economic makeover?).

ClearEdge Power, which has locations in California and Oregon, manufactures what it said it are highly efficient CHP systems for residential and small commercial buildings, based on its expertise in fuel cells, fuel processing and systems integration.”

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Here is a piece on Spotify from TechCrunch.

“Has European music startup Spotify finally figured out the online music business? Some big investors seem to think so. Rumors surfaced today that the company is raising a new round of financing of $50 million or so, at valuation of $250 million. We’ve confirmed those rumors from a source close to the company, and have uncovered lots more information about the secretive startup.

First, we’ve confirmed that Asian investor Li Ka-Shing, who invested in Facebook in 2007, will invest in this round, as will a yet to be finalized venture firm. Also, data on previous financings was not completely accurate. Last October there were rumors that the company had raised €15.3 million from Northzone Ventures and Creandum at a €71.6 million pre-money valuation.

In fact, that round was closer to €20 million, and included investments from the big music labels – Universal Music Group, Sony BMG, EMI Music, Warner Music Group. All of the labels, says our source, paid the same price for the stock that the venture capitalists did, other than one label that got in very early. That deal valued the company at €100 million, and secured (as much as possible) the long term support of the big music labels.

The new financing will bring in new “strategic” investors, which include rights holders in other geographic locations, according to our source. And while new investors are balking at the $250 million valuation, strong demand from venture capitalists is supposedly driving this deal to a close.”

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Here is a good article from The Wall Street Journal Venture Blog.

“After an anemic first quarter, venture capital investments in clean technology rose 73% in the second quarter to a total of $572.1 million, suggesting there is momentum for an industry expected to gain steam from government stimulus funding.

The number of deals in the quarter doubled from the first quarter to 48, according to data from Dow Jones VentureSource, which like VentureWire and The Wall Street Journal is owned by Dow Jones & Co. The latest figures are still below the $1.41 billion spread across 57 deals in last year’s second quarter. (See chart at the bottom.)

But the expected release of stimulus money into the sector through grants and incentives should help get investments back on track, said Joe Muscat, Ernst & Young LLP director of cleantech for the Americas.

“Barring any unforeseen capital markets circumstances, I do think we’re in a period of growth here,” Muscat said. “People are looking both at enacted legislation and at the broader climate change legislation that will be a major enabler for companies” in the sector to grow.

During the second quarter, the largest amount of investors’ money – at $157 million – went into energy and electricity generation, which includes solar, geothermal, wind and hydro power, compared with $56 million in the first quarter.

The lion’s share of the total investment in renewable power generation, or $148.2 million, went into solar deals. One of the largest deals in solar during the second quarter was a $25 million Series A round by Mountain View, Calif.-based Skyline Solar Inc., led by New Enterprise Associates.”

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