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Flash analysis: the Fisker debacle and its implications on investing, innovation, and government incentives

Katie Fehrenbacher — Fri, 03 May 2013 06:55:07 +0000

Electric car startup Fisker Automotive, along with its plug-in sports car, is turning out to be one of the worst venture capital bets of all time. We asked GigaOM readers a variety of questions about what they think will happen to Fisker and what they think will be the broader implications of and lessons learned from Fisker’s high-profile crash and burn. Here are the results.

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VC investments see downturn in 2012, do 10 percent less in funding than previous year

Eliza Kern — Fri, 18 Jan 2013 05:01:05 +0000

A recent report on venture capital investments for 2012 found that as a whole, the industry saw a 10 percent dip in total dollars funded and a 6 percent dip in number of deals over the previous year, seeing an overall downturn compared to the previous year. On the whole, venture capitalists invested $26.5 billion in 3,698 deals in 2012.

VC investments decreased substantially in the areas of clean technology and life sciences, which was balanced by significant increases in the software industry. The investments trended away from seed investments and toward early-stage (as in, the period in a startup’s lifespan beyond seed stage.)

The information is provided from the MoneyTree Report by PricewaterhouseCoopers LLP and the National Venture Capital Association (NVCA), based on data from Thomson Reuters. Here are some notable facts from the report, released Friday:

In Q4, VCs invested $6.4 billion into 968 companies, a 3 percent decrease in dollars but 5 percent increase in number of deals over Q3.
38 percent fewer seed stage companies received VC dollars in 2012 than 2011.
Software made up the largest investment sector of the year, seeing a 10 percent increase in dollars and 8 percent increase in deals over 2011.
First-time financings in biotechnology and medical devices saw some of the biggest decreases in funding, with the lowest number of deals since 1995.
Clean tech saw serious drops as well, with a 28 percent decrease in dollars and a 23 percent decrease in deals. The sector saw only $3.3 billion in funding, as compared to $4.6 billion in 2011.
Internet companies saw a 5 percent decrease in dollars and deals this year, but still had the second-best year for internet deals since 2001. They made up about a quarter of all VC deals this year.

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Green jobs, Fisker, creep into the VP debates

Katie Fehrenbacher — Fri, 12 Oct 2012 16:38:54 +0000

The Vice Presidential debates on Thursday night will be remembered for many things — “malarkey,” Joe Biden’s toothy grins, the no holds barred moderator — but it won’t be recalled as a indepth discussion of energy, clean technology and climate change. However, not surprisingly Vice Presidential candidate Paul Ryan raised a brief argument about “green pork,” and referred to taxpayer dollars going to making “electric cars in Finland,” and “windmills in China.”

Ryan started it off with:

Look at just the $90 billion in stimulus. The vice president was in charge of overseeing this. $90 billion in green pork to campaign contributors and special interest groups. There are just at the Department of Energy over 100 criminal investigations that have been launched into just how stimulus…

Biden responded with:

His colleague. . . runs an investigative committee, spent months and months and months going into this. . . .Months and months. They found no evidence of cronyism.

Biden shoots back by bringing up letters that Ryan wrote asking for stimulus funds for Wisconsin energy efficiency projects:

I’m not allowed to show letters but go on our website, he sent me two letters saying, “By the way, can you send me some stimulus money for companies here in the state of Wisconsin?” We sent millions of dollars. You know. . .

Ryan admits as much:

On two occasions we – we – we advocated for constituents who were applying for grants. That’s what we do. We do that for all constituents who are…

Biden’s response:

I love that. I love that. This was such a bad program and he writes me a letter saying – writes the Department of Energy a letter saying, “The reason we need this stimulus, it will create growth and jobs.” His words. And now he’s sitting here looking at me.

And by the way, that program, again, investigated. What the Congress said was it was a model. Less than four-tenths of 1 percent waste or fraud in the program.

And all this talk about cronyism. They investigated and investigated, did not find one single piece of evidence. I wish he would just tell – be a little more candid.

And Ryan’s final jab at green jobs before the moderator changes the subject:

Was it a good idea to spend taxpayer dollars on electric cars in Finland, or on windmills in China?

The electric car that Ryan is talking about is Fisker Automotive, which may or may not have been a good investment for the DOE to make, but which used some of the funds to manufacture its first car in Finland, and design its second car, which is supposed to be built in the U.S. A big chunk of the DOE loan was actually blocked, because Fisker didn’t meet its milestones with its first car, and was forced to raised private funds to replace that lost loan.

Fisker made it into both the first Presidential and the Vice Presidential debates!

Image courtesy of richiec.

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Hacking solutions to the world’s resource problem

Katie Fehrenbacher — Mon, 23 Jan 2012 04:10:53 +0000

This weekend in New York City, dozens of developers gathered together for the second Cleanweb Hackathon, where programmers spent the entire weekend building mobile and web apps around new ways to manage energy, water, food and fuel. As Sunil Paul, the founder of the event and a partner with Spring Ventures, put it in a short talk on Sunday afternoon, the idea behind the project is that “Information technology is the most powerful lever we have to address resource constraints.”

Over the weekend, the Cleanweb hackers created applications like NYC BLDGS, a web data base of the energy consumption of buildings in New York that pits the best and worst buildings against each other in friendly competition. Econofy, a web site created over the weekend that enables consumers to compare the energy consumption of appliances, won both the audience choice award and the judges’ award for best overall hack.

The first Cleanweb Hackathon was held in San Francisco in September of last year, and the New York event this weekend was a slightly more high-profile affair. Judges of the hacks included investor Fred Wilson and Rachel Sterne, New York City’s chief digital officer. United States Chief Technology Officer Aneesh Chopra made an appearance as a special guest.

The event is the latest sign the ecosystem around clean technology is changing. As investors look back at the mistakes that have been made and money lost in capital-intensive investments like next-gen solar, biofuels and electric cars, some investors are taking a different route and looking to make cleantech investing look a lot more like web and mobile investing — literally. Paul’s firm Spring Ventures invests in Cleanweb companies like Solar Mosaic.

The Cleanweb is an attractive way to attack the problem of climate change and resource management for an age of 9 billion people. Information technologies are available now — compared to the science experiments in biofuels and parts of clean power — and thanks to Moore’s Law they are cheap, and will get increasingly cheaper. Now it’s time to tap into the innovation of the developer community to try to create new ways to leverage IT to solve the world’s problems.

Check out the video of the event below and Paul’s explanation of the Cleanweb at our Green:Net 2011 event:

Watch this video for free on GigaOM

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How China’s troubles are affecting greentech

Jeff St. John — Tue, 19 Jul 2011 20:00:00 +0000

The second quarter brought a slew of greentech developments: We saw near-record investment in utility-scale clean energy projects but falling valuations for clean-energy stocks; big investments in solar thermal projects but struggling markets for solar photovoltaic systems; and rising private equity green investment while green VC took [...]

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