VCs Pump $3B into Clean Tech in ’07
on 29 February 2008, 12:40
by Justin Moresco
Venture capitalists invested a record $3 billion worldwide last year in clean-tech companies, a 43 percent increase over VC activity in 2006 and an indication that the industry is ripe for innovation and growth.
U.S.-based companies received $2.52 billion, or 83 percent of the total, in 159 clean-tech deals, according to data released on Friday by Dow Jones VentureSource. That represented a 79 percent increase over investment in 2006 and accounted for more than 8 percent of total U.S. venture investment in 2007.
European companies grabbed $360 million, or 12 percent of the global total, in 56 deals. That marks a 27 percent increase over investment in 2006. Investment in China, however, declined from $424 million in 2006 to $129 million in 2007 in six deals, accounting for 4 percent of global clean-tech venture investment.
Data on deals in Israel and India were not released since the countries accounted for less than 1 percent of global investment in clean tech, Dow Jones said.
One highlight of the report was that 59 percent of U.S. investment in the clean-tech sector went toward companies in the product development phase. That “suggests that funding for clean technologies is likely to continue as these companies continue to develop and start generating revenues,” Jessica Canning, director of research for Dow Jones VentureSource, said in a statement.
In January, the Cleantech Group released its estimates for VC investment worldwide into clean-tech companies. The research group came up with $5.18 billion in 2007, a figure 72 percent higher than Dow Jones’ estimate.
But Thomson Financial and the National Venture Capital Association have estimated figures that are more in line with those of Dow Jones. They found that clean-tech VC investments for the first three quarters of 2007 had reached $2.6 billion worldwide. Once the forth quarter is factored in, their numbers should match closely with Dow Jones.
Below is a breakdown by sector of global VC investment in clean tech according to Dow Jones’ research:
Segment Breakdown for the U.S.:
Segment
Investment (MM)- % of Total
Solar
$693.70 - 30.50%
Industry: Transportation
$311.00 - 13.70%
Biofuels
$264.77 - 11.60%
Power and Efficiency Management Services
$163.17 - 7.20%
Industry: Agriculture
$128.05 - 5.60%
Natural Gas
$120.15 - 5.30%
Fuel Cells
$98.50 - 4.30%
Energy Efficiency Products
$93.25 - 4.10%
Industry: Construction
$80.50 - 3.50%
Batteries
$76.20 - 3.30%
Treatment Processes
$66.20 - 2.90%
Recycling
$49.80 - 2.20%
Industrial Products
$41.25 - 1.80%
Wind
$32.85 - 1.40%
Industry: Materials
$19.80 - 0.90%
Conservation & Monitoring
$19.00 - 0.90%
Flywheels
$14.00 - 0.60%
Geothermal
$4.00 - 0.20%
Segment Breakdown for Europe:
Segment
Investment (MM) - % of total
Industry: Transportation
€ 74.19 - 33%
Solar
€ 40.90 - 18%
Biofuels
€ 34.37 - 15%
Wind
€ 14.31 - 6%
Gasification
€ 12.92 - 6%
Treatment Processes
€ 10.96 - 5%
Air
€ 10.17 - 5%
Industry: Agriculture
€ 5.75 - 3%
Hydro
€ 5.00 - 2%
Fuel Cells
€ 4.35 - 2%
Power and Efficiency Management Services
€ 3.50 - 2%
Energy Efficiency Products
€ 2.79 - 1%
Conservation & Monitoring
€ 2.00 - 1%
Industrial Products
€ 1.20 - 1%
Treatment Processes
€ 0.88
Industry: Materials
€ 0.80
Industry: Consumer Products
€ 0.38
Recycling
€ 0.10
European Investment by Country:
Country
Deals - Amount Invested (MM)
United Kingdom
15 - € 90.83
Norway
4 € 54.94
France
12 - € 35.58
Germany
9 - € 13.20
Denmark
3 - € 11.89
Sweden
3 - € 9.97
Spain
2 - € 7.50
Austria
1 - € 6.70
Italy
1 - € 2.00
Finland
1 - € 1.20
Netherlands
1 - € 1.16
Belgium
1 - € 0.90
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