In the latest report compiled by Dow Jones VentureSource, numbers show a strengthening trend in clean technology investments worldwide.
A record sum of over $3 billion was poured into 221 clean clean technology deals globally in 2007, representing a 43% increase compared to $2.1 billion in 2006.
The driving force behind the rapid growth of clean tech investments is the US, as 83% of the companies that accounted for the capital raised were US based. Deal volume in the US was up 54%, most noticeably in the alternative energy production segment. Ethanol, Solar, Wind and Electricity deals went up to 76, compared to 22 in ’05 and 46 in ’07. My guess is that it has something to do with the rising oil prices (duh!). See VentureBeat’s coverage for some of the American companies that drove this segment in the US.
According to the official press release, cleantech deals in Israel and India were not significant enough to include in the report, as they accounted for less than 1% of global cleantech investment. However, it’s a bit misleading… The largest funding deal according to Dow Jones was Shai Agassi’s Project Better Place, who took $200 million from US investors to build the first electric energy supply for cars in Israel. The deal was attributed to the US as Better Place is based in Palo Alto, Ca.
Jessica Canning, Director of Global Research for Dow Jones VentureSource, said:
“Clean technology is no longer wishful thinking. With record-high fuel prices, ongoing debate over carbon emissions, and the potential for favorable legislation following this fall’s election, investors recognize that the time is ripe for innovation and investment in this area. The energy industry is so massive that any slice of it can produce substantial returns to the investor, regardless of if they’re targeting the consumer or enterprise. And there’s currently no single clean technology leader, so there’s significant opportunity to gain from being the first to market. Combine those forces with the attention consumers are giving to products and services that comply with energy efficient standards, and you have a market with huge potential.”
Energy and clean technology are a natural match for Israel.
Israel’s arid weather drove the counrty to invent advanced irrigation systems to water the crops in the desert. The lack of water also promoted the creation of sophisticated desalination plants. Israel’s solar panel penetration is higher than anywhere else in the world by percentage and most recently, the lack of oil is the main driver for the creation of electric cars and Hydrogen powered cars in Israel, by 2011. All of the above make Israel an attractive destination for funds looking to invest in cleantech companies in 2008. I look forward to seeing the report next year – I bet that Israel will make the chart by then.
I'm a former general partner at google ventures, head of Google for Entrepreneurs in Europe and founding head of Campus London, Google's first physical hub for startups.
I'm also the founder of Techbikers, a non-profit bringing together the startup ecosystem on cycling challenges in support of Room to Read. Since inception in 2012 we've built 11 schools and 50 libraries in the developing world.
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