Dow Jones VentureSource Finds Surging Cleantech Investment in the U.S.,
Moderate Capital Growth in Europe & A Tepid Market in Asia; Deal Sizes,
Valuations Still Within Reason
SAN FRANCISCO and NEW YORK, Feb. 29 /PRNewswire/ -- An eco-conscious
society powered by clean energy, a vision long championed by scientists and
environmental advocates, may soon be a reality. This is according to new
data released today by Dow Jones VentureSource that shows venture
capitalists invested a record $3 billion in 221 "clean technology" deals
worldwide in 2007, a 43% increase over the $2.1 billion invested in 173
similar deals in 2006.
The United States is the clear driving force behind the sector's rapid
rise, accounting for 83% of global clean technology investment in 2007,
according to the report. In fact, the U.S. saw $2.52 billion invested in
159 cleantech deals, an impressive 79% increase in investment over 2006.
Cleantech accounted for more than 8% of total U.S. venture capital
investment in 2007 and received roughly the same capital outlay as the
entire business/consumer/retail industry.
"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," said
Jessica Canning, Director of Global Research for Dow Jones VentureSource.
"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."
The largest U.S. cleantech deal of 2007 belonged to the Palo Alto,
Calif.-based Project Better Place, which raised $200 million in its first
round of funding to develop a market-based transportation infrastructure
for electric vehicles.
In Europe, where Spain, Germany and others have long been on the
forefront of cleantech implementation, cleantech investment also reached a
new record in 2007 as venture capitalists invested approximately $360
million in 56 deals. This marks a 27% increase in capital investment over
2006, despite deal flow being virtually unchanged from the prior year. The
data shows that, overall, Europe accounted for 12% of global cleantech
investment in 2007. The largest cleantech financing in Europe in 2007 was
the $67 million second round for electric carmaker Think Global of Oslo,
Norway.
It was a different story in China, the report found. The region, which
saw record cleantech investment totaling $424 million in 2006, only saw six
deals completed and $129 million invested in 2007, accounting for just 4%
of global cleantech investment. However, China did see four venture-backed
cleantech complete initial public offerings in 2007, generating some $821
million in liquidity.
"What's really encouraging is that the cleantech industry is still in
its infancy in the U.S.," said Ms. Canning. "In fact, our data shows that
59% of all U.S. investment in the sector is going toward companies in the
product development phase, which suggests that funding for clean
technologies is likely to continue as these companies continue to develop
and start generating revenues."
In the U.S., the median deal size for a cleantech company stands at $8
million, up from $7.5 million in 2006. By comparison, the median deal size
for all industries in the U.S. in 2007 was $7.6 million.
For European cleantech companies, the report showed that the median
deal size rose from $2.3 million in 2006 to $3.3 million in 2007. The
median round size for a cleantech deal in China in 2007 was $11.8 million,
down from $15 million in 2006.
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.
The investment figures included in this release are based on aggregate
findings of Dow Jones VentureSource's proprietary research. This data
was
collected by surveying professional venture capital firms, through
in-depth
interviews with company CEOs and CFOs, and from secondary sources.
These
venture capital statistics are for equity investments into early-stage,
innovative companies and do not include companies receiving funding
solely
from corporate, individual, and/or government investors. No statement
herein is to be construed as a recommendation to buy or sell securities or
to provide
investment advice. ABOUT DOW JONES
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