Venture Capitalists Investments Seeing Red in 2013


Venture capital and clean technology investingOver the past few years it has been no surprise that companies started investing funds in greener technology.

Following the oil crisis that has been plaguing the world in recent years companies have been turning to alternate energy sources that are more Earth friendly. So with these companies starting to put more money in alternative fuel sources such as bio-fuels it was no surprise when venture capitalists started seeking new opportunities in this market.

With over $1.6 billion being invested during the second  quarter to The Cleantech Group investors were expecting a substantial amount of growth. But when reports came back 30% lower than last year, investors started to re-evaluate their plans to further invest in these green technologies. The big picture is that venture investing in Cleantech is on track to drop back to the same level as 2009. With the once rising market slowly dropping investors are currently seeking new opportunities in the marketplace that will yield a high return.

Solar technology has taken a huge blow this year also falling 15% this year alone. After venture capitalists saw such bad trends in the solar market they have all but pulled out and are allocating funds elsewhere. Many venture capitalists are now realizing that long-term capital intensive sectors like bio-fuels are not the right match for them and are now choosing other options instead of these.

Your are probably wondering if green tech is dropping out, where will the new investments be for 2013. Well the answer is just this, venture investors have shifted their effort and funding to more glamorous and capital-lights areas such as Internet and mobile technology services according to the National Venture Capital Association.

With all this news about the dropping numbers in Green tech it is going to be very hard for any start up entrepreneurs to obtain the necessary funds through venture capitalist with the market turning stagnant. A few years back Spring Ventures invested a large sum of money to the company Solazyme which specializes in algae fuel as an alternative fuel source. After this recent decline they have now shifted focus to internet and mobile technologies.

Some of the markets in the green tech have been doing dropping Clean Coal has been coming back for 2013. China has been making new strides in their R&D according to Kachan of Cleantech Group . These new technologies emerging are creating coal that can be burned that is also healthy for the planet.

Mobile technology and Internet based companies are taking great gains in 2013 by now your wondering where, because? It is such a broad market…. According to Forbes magazine some strategic technology trends that will have great gains for 2013 include

  • Cloud Computing
  • Enterprise App Store
  • Integrated Ecosystems such as Windows 8
  • Mainstream in -memory computing such as SAP

All this new technology is creating more integrated and effective companies.  When in investing in new technologies that help companies work better. These technologies are also less capital intensive.

So because of long term investments involved with these green technologies, venture capitalists are seeking the mobile technology route because of the potential for huge growth and also the low amount of capital that’s required for investing. With a limited amount of capital required, riskier projects can be invested in and could possibly yield better results.

This is not to say that there aren’t some great investment opportunities in the green tech market. Forbes feels that Investors are positioning themselves and calculating the risk a lot more before thinking of investing any money in Green Technology.

Do you think the technology industry is right for your next investment? Do you agree with the trends? Leave a comment below.

About Cathie Briggette

Cathie is responsible for planning, development and implementation of all Touch Ahead Software’s marketing strategies, marketing communications and public relations, both internally and externally. She also serves as the Marketing Director for NSK Inc., which she joined as an associate in 1997 and where she worked as a developer on multiple mission-critical projects — including several financial projects. Prior to Touch Ahead and NSK Inc, Cathie was the Marketing Manager for the US Software Division of Objects 9000, a German-based company. And before that she was the Marketing Director for Pelikan Pens.

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