Sometimes things are so obvious as to be hard to see.
That is certainly the case right now with the incredible flood of federal stimulus pouring into the economy - both in terms of fiscal and monetary policy. But saying it in this way, as it is often done by the chattering media classes, makes the issue unnecessarily opaque and complex. We agree with Milton Friedman (and not just because of his long Stanford connection) when he describes inflation as "always and everywhere a monetary phenomenon."
Clean technology (“cleantech”) is one of the fastest growing areas of investment within the venture capital and private equity community, showing constant growth since 2003 and accounting for 7.4% of total venture investment in 2007. According to data compiled by Cleantech Group, LLC, the 3rd quarter of 2008 saw $2.6 billion invested in 158 deals in the sector, with total investments in 2008 projected between $7.6 and $8.1 billion. This represents 30% growth in comparison to 2007’s $6.01 billion, $2.2 billion of which was invested in U.S. companies.
The cleantech category is comprised of a variety of subsectors that represent products, services, and technologies created to reduce greenhouse gas emissions, develop energy independence, promote energy efficiency, and conserve natural resources. Subsectors within the category include:
- Solar, wind, biofuels and geothermal energy generation
- Infrastructure to support alternative energy generation
- Energy storage (batteries, fuel cells, etc.)
- Agricultural productivity and natural pest control technologies
- Materials and manufacturing processes requiring less resource intensive inputs
- Pollution control, recycling, clean coal, and wastewater/water technologies
Despite the economic downturn, cleantech is one of the only sectors still projecting investment growth, particularly once President Elect Obama takes office tomorrow. Obama’s energy plan calls for a $150 billion investment in clean technologies over the next 10 years, aggressive targets for greenhouse emissions reductions, and programs to promote energy efficiency, low-carbon biofuels, and renewable energies. Obama has also called for a national Renewable Portfolio Standard (RPS) requiring that utilities generate 10 percent of electricity from renewable sources by 2025. New mandates, tax incentives and the recent Energy Independence and Security Act of 2007 will continue to drive domestic growth within the sector.
Internationally, interest in cleantech has grown in countries around the world, particularly in the Middle East, Europe, and China. Sovereign wealth funds from countries in the Middle East were involved in six of the top ten largest financings within the cleantech sector in the 3rd quarter of 2008. More specifically, countries such as Qatar have been raising funds solely for cleantech, such as the recent $396 million Qatar Investment Authority cleantech fund. The European Union has targeted 20% of its energy to be derived from renewable resources by 2020 and China has targeted 15% under its Circular Economy Law. As new regulations are put into effect globally, particularly in emerging markets such as China, demand for innovative energy sources and cleantech solutions will grow as existing resources are depleted.
Through its consulting and capital raising advisory services, Growthink has worked with innovative emerging growth companies across all of the various cleantech sectors. Through this unique combination, Growthink is able to provide cleantech entrepreneurs with the perspective required to identify and capitalize on prevailing trends in their respective markets and industries.
If you are an entrepreneur or a potential investor seeking more information about investment opportunities within cleantech, contact us at (800) 260-6630.
We're honored to have the Growthink Blog syndicated on the "Startups" section of Alltop: http://startups.alltop.com/
For those unfamiliar with Alltop, it is an excellent blog aggregator that collects stories from top blogs in various topics, ranging form work and health to technology and hundreds of other subjects.
Alltop is an indispensable tool for staying on top of the news. We use it every day, and we're honored to be included.
I’m really good about working out. With few exceptions, I go to the gym every day after work and try to work out at least one day over the weekend.
Part of why I go is to stay in shape, but I think it helps me a lot business-wise as the exercise helps me release excess energy so I can really focus on the tasks at hand when needed.
Because there’s always too much to do each day and yet I insist on going to the gym, I’ve devised a laser-focused 25 minute workout that I follow. It’s nothing too fancy -- it’s mainly that I go from machine to machine to machine with no breaks in between (many people do a similar routine but it takes them twice as long since they take breaks in between each rep and/or machine).
Anyway, what this means for me is that every January is a nightmare. Why? Because every January, the gyms are full. And this means that I can’t quickly go from machine to machine to machine because I have to wait for others who are using the equipment.
This happens because every year, tons of people make New Year’s resolutions to go to the gym more. So, in early January, the gym is full of these “resolutionists.” Fortunately, by February, they’re usually gone and it’s back to normal.
The reason I tell you about this is that it’s incredible how much this mirrors raising capital.
To begin, raising capital, like weightlifting and exercising, only works if you do it EVERY DAY. You don’t get strong working out like crazy for one month and then relaxing the rest of the year. Rather you need to put in an hour a day or an hour every other day throughout the year to realize an impact.
When raising capital, you need to constantly be speaking with investors, finding new investors, and making presentations. You need to constantly tweak your business plan to make it better and better. This will not happen overnight. It takes months.
Also, in weightlifting, if you don’t know what you are doing, you will have poor form and you will most likely hurt yourself. In capital raising, if you don’t know what you are doing, you will also hurt yourself and your company by failing to raise the capital you need.
And, like in the gym example, all the “resolutionists” HURT YOUR CHANCES of success.
At the gym, the “resolutionists” hurt me be using my machines and thus slowing me down.
When raising capital, those who don’t know what they are doing also hurt your chances. They submit their business plans haphazardly to every investor who will accept them. While these investors will rarely if ever fund these plans, they waste the investors’ time. As a result, the investors have less time to review good plans and meet with good entrepreneurs, like you.
I wish I could tell you that raising capital was fun. But I can’t. I wish I could tell you that it was easy. But I can’t do that either. Like weightlifting, it’s neither fun nor easy, but once you learn how to do it, and you repeatedly do it right over a period of time, you can succeed and the rewards far outweigh the costs.
GrowthinkUniversity.com, our new membership website, was designed to teach you how to raise capital using the proven techniques that we have implemented over the past decade for our consulting clients.
In his post, Could the credit crunch be good for startups?, Alexander Muse of Texas Startup Blog discusses Nortel's bankruptcy filing, and the silver lining he sees for entrepreneurs in the telecom space.
With the bankruptcy and ultimate breakup of the company, there will be lots of room for innovation from startups and entrepreneurs in the telecom space... Tightening credit markets mean that companies need to generate profits and can’t simply use debt to wait out under capitalized startups.
Just as forest fires cause great destruction, they are fueled by dead wood and allow new healthier forests to emerge.
Related post: The Downturn - Keeping Things in Perspective
The Small Business and Entrepreneurial Council recently released its ranking of the states that impose the fewest burdens on the growth of new businesses in their areas.
The report analyzes dozens of factors affecting entrepreneurship including regulatory costs, health-care costs, and crime rates.
Here are the full rankings of all 50 states, including District of Columbia (which came in dead last):
Click here to read the full report.
Where does your state fall on the list?
Does your state's ranking reflect your personal experience?
A recent article from the Wall Street Journal suggests that companies are becoming more productive in response to the downturn.
The WSJ noted that in Q4 the decrease in the number of hours worked might have been greater than the contraction in overall economic output. In other words, businesses appear to have increased their productivity.
Improvements can come from shifting marketing budgets to more easily measurable media (such as internet marketing) as opposed to print and television, renegotiating more favorable contracts with vendors and suppliers, and eliminating redundancies and waste across departments.
An uptick in productivity would contrast favorably with previous slowdowns in the 1970s and 1980s when productivity lagged.
How are you reacting to the downturn? What measures have you taken to improve your firm's productivity?
What traits and skills really make Richard Branson, Bill Gates, Donald Trump, and countless other entrepreneurs so successful?
Over the past decade, we've identified key ingredients that lead to success, which we've observed both in celebrity entrepreneurs and in our most successful clients. When it's all said and done, they have all of the following critical skills, which are essential to entrepreneurial success:
Vision & Leadership: Entrepreneurs must have a vision of where the company will be in the future. In addition, you must be able to communicate you vision so as to motivate employees, investors, and partners to help you achieve that vision. You must be able to identify staffing needs, expertly fill them, and lead your team to success. Rarely do entrepreneurs build successful companies all by themselves.
Focus & Execution: Entrepreneurs must focus to make sure that goals are achieved, customers are satisfied, and employees are motivated. For most entrepreneurs, staying focused is harder than it sounds. Be careful not to be seduced by the next exciting opportunity without executing on the priorities at hand. And don't let perfectionism prevent you from taking action, either; at the end of the day, a product on the market is better than a product shelved due to lack of focus, execution, or perfectionism. Get to market and get feedback from your customers as soon as possible.
Persistence & Passion: As an entrepreneur, you must be passionate about what you are trying to accomplish. In addition, you must be willing to commit whatever is needed of them, whether it's time, energy, money, or other resources. You must persist through trying times (which will be frequent), and fight as much as needed to achieve the goals you have set for yourself and your team.
Technical skills: As the owner of your firm, you may not need to be the most skilled technicion on your team. But you need to have necessary foundational knowledge to be able to lead your technical team and make informed decisions.
Flexibility: Successful entrepreneurs understand that the world and the environment in which they operate are constantly changing. While you must focus on the end game, you also must adapt your strategies and offerings to meet changing market conditions.
There has often been debate regarding whether entrepreneurship can be taught. Can you really teach persistence or passion? Perhaps you can't. But if you understand the importance of these entrepreneurial traits, you can focus on them and make the necessary adjustments to succeed in your entrepreneurial endeavors.
What about you -- what skills or traits do you think make entrepreneurs successful?