VCs pump $733M into U.S. cleantech in Q1

Silicon Valley/San Jose Business Journal
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Venture capital investment in U.S. cleantech companies during the first quarter hit $733.3 million in 72 financing rounds, a 68 percent increase in capital and a 118 percent increase in deals compared to the same period last year, according to a report Thursday.
The figures are according to an Ernst & Young LLP analysis based on data from Dow Jones VentureSource. Compared to the preceding quarter, however, the figures represent a 6 percent decline in funding and 1 percent decline in financing activity.
The report said cleantech investment is recovering faster than overall venture capital investment, which increased 11 percent from the year-ago quarter to $4.7 billion. The total share of venture capital invested in cleantech reached 16 percent this quarter.
Early stage venture financing was particularly robust, with 34 seed and first rounds represented 49 percent of financing activity, the highest percentage since the fourth quarter of 2008. The Energy Efficiency category received the largest proportion of seed or first round investments — 41 percent — underscoring the sector’s appeal for new financing and company creation.
“With rising oil prices and growing signs of economic recovery, particularly in Asian markets, the drivers for cleantech remain strong,” said Gil Forer, Ernst & Young’s Global Cleantech Leader. “Given that the majority of government stimulus funds have yet to be deployed, the intensifying focus on cleantech solutions as a driver of operational efficiency, and the robust cleantech innovation pipeline, we expect increased activity in coming quarters.”