Greentech investing has been getting a series of one-two punches — will it soon be down for the count? According to the weekly update (subscription required) from our GigaOM Pro Green IT analyst Adam Lesser, while the ecosystem is looking darker, it’s also growing up.
Here’s the bad news. While overall VC investments grew 19 percent to $7.5 billion in the second quarter of this year, cleantech saw a 23 percent decrease, from $1.2 billion in the first quarter to $942 billion in the second quarter. Combine that with a maturation process for cleantech investing over the past couple of years, as capital has become harder to come by than it was between 2006 and 2008, and “science projects” — which are really basic scientific research and should be funded by the National Science Foundation, not venture capital — are no longer fundable. Finally add in the inevitable commoditization of solar, and add the cherry on top, which is potentially the worst VC disaster in history with Solyndra.
However, Lesser notes that according to GigaOM Pro’s Flash Analysis, which surveys both investors and those from the industry, on one hand there is some general negativity in the air, with 30 percent of investors viewing the environment for VC as being “in bad shape.” But on the other hand, 43 percent of all respondents still thought there were attractive opportunities in greentech. Go figure. Problem is, growing up is sometimes painful. Like $1 billion worth of equity investments lost painful (the Solyndra deal).
Read the rest of Adam’s weekly update on GigaOM Pro.