Transportation, Energy Efficiency and Agriculture & Food most active sectors
SAN FRANCISCO, CA–April 28, 2014 – Cleantech Group™ (CTG), developer of the i3 market intelligence platform, today announced the results of first-quarter trend analysis in sustainable innovation. The analysis of corporate and venture investment raised and partnerships formed by early- and growth-stage start-up companies identified clear trends in the top sectors for innovation.
The Transportation sector continued to be one of the most vibrant with commercial partnerships formed by numerous companies, including EcoMotors (efficient engines) and PowerGenix (electric vehicle batteries), and investments made in electric and fuel cell vehicles, biofuels, and digital- or web-enabled solutions for vehicles, fleet logistics, and transit.
Corporate and institutional investors drove venture equity investment in the sector to $561 million across 42 deals during the first quarter of 2014. That dollar total was 43 percent higher than the average for the past four quarters, whereas the deal volume was 11 percent lower. Venture debt and private investments into growth stage public equities (PIPE) added another ten deals and $59 million.
Corporate investors participated in 11, or 21 percent, of the quarter’s Transportation deals. Notable deals included Chinese e-commerce giant Alibaba’s participation in Lyft’s $250 million Series D round, Total Energy Ventures’ investment in sunfire, a maker of fuel cells for both automotive and stationary power applications, and Cool Planet Energy’s final $50.7 million closing of its $100 million Series D round for biofuel development, which included participation from Concord Energy, Google Ventures, ConocoPhillips, General Electric, NRG Energy, BP Ventures, and Constellation Technology Ventures.
Energy Efficiency continued to be a highly active sector for partnerships and investment, led by Google’s $3.2 billion acquisition of Nest, the maker of smart appliances. Entrepreneurs and investors have also been emboldened more recently by the initial public offering of Opower, a company deploying behavioral science through utility bill reporting to encourage home energy efficiency, early in the second quarter.
Energy Efficiency companies raised six percent more ($377 million compared with $354 million) in 34 percent fewer (35 compared with 53) venture equity deals in the first quarter of 2014 than the average for the previous four quarters. Debt and PIPE rounds involving growth-stage companies added $21 million and four deals to that tally.
Still, the sector saw big $100 million capital-raises from View, a maker of dynamically-tinting glass for buildings, and Nutanix, an enabler of more efficient data centers. Additionally, significant commercial partnerships were formed by efficiency start-ups including Daintree Networks (with LG Electronics), GreenWave Reality (with E.ON, DONG Energy), and Gridium(with Pacific Gas & Electric).
Corporate investors were an important source of funding, participating in seven, or 18 percent, of the quarter’s deals. These included an investment by Aster Capital, the joint venturing partnership of Schneider Electric, Alstom, and Solvay/Rhodia into Iceotope, a developer of liquid cooling technology for data centers, as well as SAP Ventures’ investment in Nutanix, and Fujitsu’s investment in SuVolta, a maker of low-power semiconductors for electronics.
AGRICULTURE & FOOD
The Agriculture & Food sector experienced the highest growth in investment of any of the sectors tracked in i3, with $203 million (up 78 percent from four-quarter running average) in venture equity invested across 29 deals (up 66 percent). Debt and PIPE deals added another five deals and $16 million.
The quarter saw commercial partnerships formed by companies including micro-algae to animal-feed developer Fermentalg (with Adisseo) and farm software provider Farm Intelligence (with Zarada Storage).
Corporate investors participated in three (nine percent) of the quarter’s 34 Agriculture & Food investments These included GE Capital and BP Ventures’ investments in seed technology company Chromatin’s $36 million growth round, Intrexon’s investment in aquaculture companyAquaBounty Technologies’ $10 million PIPE round and Google Venture’s participation in farm software company Granular’s first round of $4 million.
SECTOR REPORTS AVAILABLE
Other top innovation sectors for the quarter included Solar, Bio Commodities, Energy Storage, Oil & Gas, Smart Grid, Water, and Recycling & Waste.
For more in-depth data and analysis, interested parties can read the i3 Quarterly Innovation Monitor reports covering each sector, to be published mid-May, and subscribe to i3.
“Strong recent exits tracked by our i3 market intelligence platform, including Nest’s acquisition by Google, Climate Corp’s acquisition by Monsanto, and LG Chem’s purchase of NanoH2O, coupled with first quarter equity investments, emphasize that energy and industrial companies are embracing external innovation,” said Sheeraz Haji, CEO of CTG. “Successful initial public offerings by companies like Opower and SolarCity, have also caught the attention of investors and corporate executives across the globe. This trend, coupled with an increasing number of corporates that are leveraging the i3 platform, proves that corporates have a growing need to connect with innovation efficiently and at scale.”
About Cleantech Group Inc. (CTG)
CTG helps clients accelerate sustainable innovation. The company’s i3 market intelligence platform, which tracks over $7 billion of deal flow annually across 23,000 cleantech companies, allows subscribers to find, vet, and connect with entrepreneurs—efficiently building an innovation pipeline. Cleantech Forums bring the i3 platform to life by convening thought leaders and innovators around diverse themes in innovation. CTG’s Advisory Services leverage expertise in designing and executing corporate strategies for sustainable growth and innovation sourcing. Details at www.cleantech.com