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Investors see green in clean tech
July 20, 2005
The clean-tech sector, covering everything from solar technology to biofuels, is awash in venture capital money. Many people from the IT industry, either following the money or eager to make a positive environmental impact, have been streaming into the clean, or green, tech area for the past two years.
For those making the transition, the jump often means a completely different technology and customer. But converts say that even people who have plied their trade in hardware and software for years have something valuable to offer clean-tech companies, namely speed.
"Most executives on the energy side aren't necessarily entrepreneurial," said Mitch Mandich, the CEO of cellulosic ethanol company Range Fuels and a former Apple executive. "They're just not conversant in...this notion of velocity and time-to-market."
The formula investors and entrepreneurs like Mandich are betting on is a combination of core engineering in a particular domain, such as solar power, coupled with the management expertise that seasoned high-tech executives bring.
The reasoning behind this blend goes back to investors: venture capitalists looking for a good return want start-ups to focus on rapid growth in order to beat out an increasingly crowded field.
In many cases, clean-tech companies cater to industrial firms or utilities with strict product quality standards, which means that buggy products delivered at "Internet-time" speed are inappropriate.
Still, bringing Silicon Valley-style entrepreneurship to energy and related fields represents a dramatic injection of new blood in industries that have historically been dominated by corporate behemoths, say executives.
"It does take a little bit longer time to get products to market, but the notion of innovation and driving down costs through scale--that's all here now," said Mandich. "The IT side of the world is going to have a large impact on energy across the board."
What was your major?
David Cope, the CEO of water and food treatment company Novazone and an "ex-software start-up guy," said finding the proper mix of high-tech skills and domain expertise is his biggest challenge.
The key is finding people who have shown a willingness to reinvent themselves, either by switching from hardware to software in previous job transitions or by leaving IT to work in another industry altogether, said Cope, who joined the company last fall.
Because many clean-tech companies involve chemistry or engineering disciplines outside IT, investors and CEOs are digging deeper into candidates' backgrounds.
"We get guys who spent the last 20 years in software or networking and found that they did an undergraduate in environmental engineering," said Paul Holland, general partner at Foundation Capital who coordinates the firm's clean-tech practice. "They couldn't get a job in that 20 years ago so they went into IT. Now they are coming back."
The motivations for seeking out clean tech start-ups range, but a growing concern with climate change and the desire for energy independence in the U.S. play into many peoples' decisions, say executives. Others are eager to learn a new technology or simply pursue job openings at funded companies after being laid off.
Another factor in the IT talent crossover is that Silicon Valley venture capitalists are tapping into their familiar network of contacts as they move into clean tech, said Range Fuels' Mandich.
See more CNET content tagged:
green tech,
information technology,
engineering,
venture capital,
investor
Someday people will look back on this stuff and wonder where people's heads were.
Let me tell you a story.
There onece was this clever buch of people who feed off the mineral rich soil of old UK kingdom.
Then this empire came in a said to them were going to kill you or you'll work for us because we have the almghty triangle.
He said you idiot do i care about your little blip of exsistance i'm sure somthing else will happen and more and more and whatever but you still won't get it.
The roman went and kill loads of them and called them cave men.
Then he made them farmers and stoped them from really working up there farms properly with good interesting food types just patatoes and things.
Wow he was so clever.
today it's called 2007 and loads of people have cancer and diebities and are triangulated to do what some idiot calls thinking.
Amongst this world quite a few people make some sense.
Like that black mans black
Or for some reason our growth that we are seems to like two as opposed to that tree which branches out in all directions.
Or look i can point my finger in six directions.
Or even admtidly that six seems to work with numbers in a sort of 3 way.
Then you get stupid comments like god dosent play dice.
I mean whos god and whats dice got to do with anything.
All the time my head just seems to reflect that clip on the animatrix of these bone hands claping at their own stupidity.
Of course we now know whats going on were not on a flat peice of land with the sun and moon going round not that that was everyones view in the first place but yes we've pretty much got it sussed.
its one (not that anyone can properly explain where one came from or why).
Yes its a universe and we're probably the most intelligent ones out there not the most degenerate and yet were all afrid of some and hope for money while scratching our heads as to why the rich who are there are there.
You know somone with 56 billion still wearing glasses or the last nuron in ozzy ozborns head woth millions.
Year theres loads to fear and you lives a worth all the intelligence potential in the universe.
There is of course the possibility of another universe exsisting somewhere about the same size and may have 4 geometric dimensions although thats just maths hasen't made it's way into worth while theory yet (wow i'm so looking forward to the future.
Of course bread one glass of milk.an orange juice some water and one egg a day and your healthy.
Did you know that half the world rip roses out the ground and let them rot over cremated dead bodies woshiping to god(look there he is again).
Then of corse if your not awaiting cancer,worshiping god,and wanting more money thats obviously is going to get you out of this mess your a coomy and should be shot on the spot or somthing.
If not your a liberal we're all equal.
Yep ignor the uglyness because theres such a overtime warped a view as liberal where equall is selling barbie toy thats look perfect.
Year perfect (not much of a brain straigh hair that never works and most of you growing up looking for anything else accept where your bullied to like the post man who eats up the tress for some reason).
So anyway when your there pondering your money over life and resource and did i mention life you know that stuff that grows twenty to the dosen if left in a box for a week.
Oh i'm sorry that poor poor life.
Yep anyway when there considering load matianance of workman ship towards flowers and one big organic well dreamed up world by um loads of us that didn't like mcdonalds or mcjobs for that matter.
Opps a little to clever there get back to prudantly(as you think it is) triangulating your riches(Ha) and remeber it'll all be wiped by what might be the spy rith of your granny when you drink, tablet or blatently punch yourself to sleep to night and you will just have that amazing witchcraft in the morning becasue theres that fear thats goood (goooold) for you and you will be the winniner.
Yes you to can have poor doctors and idiots around you at the gand sum of 1 billion or so.
Even better you can be emoral and blasfem god or somthing and fear and drug yourself up and insure your nuron for 1 billion.
Yep your a rich nation/western world and that farmer/slave did a really good job with your diet.
Nope my bllod line were those farmers on a few side or somthing and i'm always looking fr really soil and things and hated my mums food.
I love digging and am clever enough to know that a 4 chi buch of gravitated energy would be whats made of this kind of stuff and that chi isnt all in al that amazing scope and that what i see around me is six planes on a treble chi.
I also know a triangle is worthless and ET wouldent pick up some egyptian in his pyrimid if his mum was the uglyist star thing in all of the next 1000000 billion ^2^2^2 -> Nth of a google.
If it wasn't for the fact that I'm in China and would like to stay here for another six or so years, I'd be reluctant to consider a move like this. Fortunately, my best buddy in China runs a company manufacturing PV modules. And, guess what, the best three markets in the world for all things solar according to a recent report are the U.S., Spain and China. We're in China, he's Spanish (and already has a multi-million dollar contract in the EU), and I'm the native Californian.
I get a chill down my spine when I think of my chem classes, especially way, way back in AP Chem with Dr. Greenstadt at Fairfax High in Los Angeles (kind of a legend among the teachers there; Fairfax itself is probably the best known High School in L.A. outside of Hollywood High, even though Room 222 was filmed at L.A. High). But I've read enough NREL reports, trade articles and technical papers to decide that it's a worthwhile pursuit.
I really love the UXD (user experience design)/HCI side of our biz ... and I'll still do what I can to keep up with things (maybe SIGCHI conferences and the like on vacation time). Yet, this seems like a good opportunity for me.
The solar/PV manufacturing scene in China is hypercompetitive, but we have some solid competitive advantages: For one thing, we might well have the best manufacturing systems in China. Alas, my heart still cries out for the UXD/HCI world, but my life in China is leading me toward green tech.
At the very least, it should be an interesting adventure. Everyday in China is a new experience (I've lived here for over 3 years) ... and now I'm about to amplify the experience!! My crash helmet is on: If I need it, I hope it's due to hypervelocity, not an accident.