As a venture capital investor we see hundreds of entrepreneurs each year. Our objective is to find a few that we can support. But, along the way, there have been some notable standouts who have stumbled before leaving the first meeting. I thought it would be fun to share with you some stories and suggestions on what not to do between the first contact and end of the first meeting.

1. Send separate e-mails to all the partners

Recently we had a company send the exact same pitch e-mail to all the partners at Pangaea. I can understand the entrepreneur’s desire to increase his or her odds of getting a response but this can cause confusion at our end and we ended up passing on the deal partly as a result of the entrepreneur’s stumble out of the gate.

Cleantech in 2013

Posted by on in Venture Capital

It's that time of year when everyone looks into their crystal ball and ponders the year ahead. Having read several outlooks earlier in December, I noted a regurgitation of what were actually 2012 trends, such as the rise of natural gas, the shrinking of cleantech VC investments, the rise of corporate investors and the death of solar. I was inspired to formulate my own list for the coming year:

1. Agriculture Investing a Top-Three Cleantech Segment

2012 was a blockbuster year for agriculture technology exits. Nothing gets a venture capitalist's juices flowing faster than nine and ten digit exits like we witnessed in 2012 (see Keith's Blog from October). With entrepreneur's having spent 2012 matching technologies, problems and markets, the VC checkbook will be wide open in 2013. Agriculture tech will be one of the top-three cleantech investment segments of the year.

Way back in 2006, Bill Aulet, now Managing Director at the Trust Center for MIT Entrepreneurship, invited me to be part of a panel discussion on corporate venture capital (CVC) as part of the 9th Annual MIT VC Conference. Bill gave a wonderful and detailed presentation, showing how CVC worked, adding the financial returns to strategic value. His model suggested that the financial returns might be insignificant compared to the strategic impact for the greater corporation. In the spirit of his pre-panel suggestion to be contentious and confrontational, I spoke up: "Bill, that's a good model if you want your CVC to fail."

From Innovation to Commercialization

Posted by on in Venture Capital

Innovation – a new or better way of doing things - is a powerful force in the economy. It is directly, and indirectly, a key driver of jobs growth and competitiveness locally and globally. In Canada, small businesses and start-ups provide 48% of all jobs and contribute 30% to the country’s GDP. In the United States, small businesses and start-ups play an even larger role contributing 46% of the private nonfarm GDP. Never before have the innovation and commercialization cycles been shorter. With researchers seeming to produce more published work every year, why have some countries been more successful at commercializing technology than others? Is the challenge providing researchers with adequate support to move their work out of the lab are the early stage companies and entrepreneurs requiring an extra boost?

Over the past two or three years, a consensus view has developed that the capital inefficiency of clean tech startups makes them incompatible with the venture capital funding model. Many investors with their feet half in are delegated to invest only in business model innovation, efficiency software, controls technology, grid optimization and so forth. It’s hard to disagree with these folks when reflecting on the colossal quantities of risk capital that has been deployed to support innovation such CIGS solar - without commensurate returns. Unfortunately, this ignores the fact that the change-the-world type innovation occurring in labs around the world is exactly the type of technology that has scared many investors away.