Recent blog posts

LED lighting has the potential to be one of the true blockbuster clean tech markets. A 2011 report by McKinsey & Company forecasts the global lighting market to reach €108BB($140BB) by 2020 with LEDs taking €64BB($83BB) of that share. This is a 10X increase from the LED lighting market size today. Technology is advancing as well; with Cree producing a record 254 lumen-per-watt device in 2012 - almost a 3X increase over the last decade. Exciting stuff for VCs indeed!!! At Pangaea Ventures we share in the excitement but worry that current thinking just won’t take us far enough.

The numbers are in, and they ain't pretty. They tell us that 2012 represented the worst year for cleantech investment since the dark days of 2009. Depending on whose numbers you accept, investments in cleantech declined 28%, from $4.6 billion in 2011 to $3.3 billion in 2012 (PWC Moneytree, or MT for short), or 29% in the case of the Cleantech Group’s (CG) numbers. Meanwhile, the venture industry as a whole contracted by only 10%.

Organic electronics, from OLED displays and lighting to third generation photovoltaic modules, is an enabling technology platform promising lighter, cheaper, and more flexible devices for a wide variety of industries and applications. The recent proliferation of organic-empowered devices like Samsung’s AMOLED displays in their Galaxy line of smartphones and tablets shows just how far we’ve come over the last few years. However, we still have yet to see the truly transformational devices on a large-scale inconceivable with their non-organic analogs (e.g. fully printed, flexible HDTVs).

The State of Nanotechnology

Posted by on in Advanced Materials

Nanotechnology has always been around but got a big boost with Richard Feynman’s lecture titled “There’s plenty of room at the bottom” in 1959. The introduction of the scanning tunneling microscope in 1981 and bucky balls (60 carbon atoms) in 1985 further ramped up the interest level. Then came the ambitious predictions and amazing forecasts. Everyone, including me, wanted to get some action. The rush generated lots of activities in terms of startup companies and investments and naturally, there was the inevitable disappointment. These days, the decibel level is lower but make no mistake, nanotechnology is now integrated into conventional technologies and making a difference. Both startups and large corporations are introducing nano-enabled products in the marketplace across industries that include energy, chemicals, environmental, electronics/semiconductor, personal care, textiles, agriculture, transportation, biomedical/biotechnology, and packaging. Already, over 800 everyday products (Nano.gov) rely on nanoscale materials and processes and this will surely continue to expand.

Women: A Start-up’s Secret Weapon

Posted by on in Venture Capital

If you are thinking about launching, or have recently launched, a start-up here’s some food for thought…especially if you plan on seeking venture capital financing down the road.

Do you want to increase your chances of success?
I’ll assume the answer is yes, so keep reading – and take notes.

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."

Examining The Drop-In Replacement

Posted by on in Sustainability

Entrepreneurs often like to promote their solutions as "drop-in replacements" for existing technologies. This makes a lot of sense. No established company wants to hear about a different way of doing something that incurs significant switching costs or other associated manufacturing hardships even if the novel solution, material, or product provides additional compelling cost and/or performance benefit(s). In my experience, these claims of drop-in replacements usually have to be taken with a serious grain of salt.

The Onset of Renewable Chemicals

Posted by on in Sustainability

Global concerns about the environmental impact from use of petroleum-based feedstock to produce chemicals have fuelled the rise of “green” chemistry. Typically, this includes the deployment of more environmentally friendly production technologies and use of biobased feedstocks to manufacture renewable chemicals, fuels and bioenergy. Use of these green chemicals is already underway with various products already in the markets. In 2011, the U.S. Department of Agriculture (USDA) estimated that there are 20,000 biobased products currently being manufactured in North America. Recent forecasts project the renewable chemicals market to reach $100 billion by 2020. The economic benefits from this sustainable approach is also significant, with potential savings of over $65 billion in the chemical industry that is expected to grow beyond $5 trillion value by 2020. Additionally, the growth of renewable chemicals provides a major opportunity for the chemical industry to reduce its carbon footprint.