Investors are getting back into green investing in a big way, and venture capital into solar and biofuels are two of the big drivers.
An excerpt from a Greentech Media report posted on MarketWatch.com says that investors put $1.2 billion into 85 deals during the past quarter… compared to just $836 million in 59 deals during the first quarter of this year.
“The recent quarter’s balanced distribution of sectors that attracted capital underscores cleantech’s breadth and diversity of opportunity, one of the key drivers behind why cleantech remains an enduring area,” said Ira Ehrenpreis, General Partner at cleantech VC, Technology Partners.
Solar power was once again the leading investment segment at more than $330 million. Unlike previous quarters – the second quarter saw a much more balanced distribution across the various sectors with a marked increase in automotive (more than $202 million) and energy storage (more than $180 million) [with biofuels scoring $195 million and wind & geothermal producing more than $22 million in investments].
One of the drivers for steady second quarter venture investment was the promise of stimulus monies offering startup investors a non-dilutive funding source. Meanwhile, early-stage and late-stage investments dominated, while mid-stage funding was harder to come by, and the average round sizes were slightly smaller. There were no giant $100 million+ solar or biofuel rounds as in 2008.
Greentech analysts believe that this year will be one of consolidation and development, but green sector investments will really take off in 2010 and 2011.