Cleantech Venture $$$, Small but Growing

We’ve been checking out the 5th annual Dow Jones VentureOne report and we thought it was interesting to see that it attributes emerging sectors like cleantech as one of the factors that made venture investment in 2006 the highest level since 2001. OK, so it’s still a small portion of total investment, but in 2006 the report says that there were 140 financing rounds for cleantech companies worth $1.28 billion — nearly double the size invested in 2005.

The report dedicates several sections to cleantech and highlights the global nature of the industry and what roles the U.S., Europe, and China will play. The U.S. was the largest investor in cleantech over the past three years, while Europe’s cleantech investment was smaller than the U.S., but makes up a larger percentage of venture funding there. China, with its environmental issues, “will become the largest market for cleantech because it has no other choice.” (A recent report by The Cleantech Group details the growth of cleantech investment in China).

Our favorite cleantech nugget from the DowJones Venture One report is the Cleantech Venture Network’s addition of its “7 Key Trends for 2007/2008. Check out the list:

  • 1). Internet/IT: “The IT and communications industries could and should become major cleantech players in 2007.”
  • 2). China: China is the home to manufacturing and thus the home to those nasty environmental effects. “Will China be a clean tech superpower or environmental pariah?”
  • 3). Water: Water management will be “as important as energy in 2007.”
  • 4). Toxicity: Concerns over toxins is rising and startups can offer nontoxic solutions.
  • 5). CEOs: High profile CEOs are leading initiatives, and this will continue in 2007.
  • 6). Carbon innovation: We need technology for a low carbon economy — this will effect “market creation and purchasing decisions.”
  • 7). Policy: Cleantech can mean jobs and economic development, and policy will support that.