Cleantech Bucks the Downturn: Thank Algae, Solar Thermal

The most recent quarterly cleantech investing numbers are out from the Cleantech Group, and they contain some upbeat news: Investing in saving the Earth doesn’t stop when the economy drops — at least it hasn’t so far. According to the Cleantech Group, the second quarter of this year was a “record” quarter for cleantech venture investing, with $2 billion going to 96 companies. That’s a nearly 60 percent increase from the same period a year ago and higher than the last record quarter — $1.8 billion from the third quarter of 2007.

The numbers are also notable in that overall venture investing has started to slow down, at least in the first quarter of this year. Yes, the first quarter tends to be cyclical, but venture investing overall in that quarter dropped 8.5 percent compared to the fourth quarter of 2007, and was also down from the same quarter a year earlier. And not a single venture-backed company went public in the second quarter of this year, according to the National Venture Capital Association. Though whether that was partly cleantech’s fault is the subject of much debate.

So what drove growth in the second quarter? Solar thermal technology and second-generation biofuels, including cellulosic ethanol and algae-based biodiesel.

Solar thermal companies, like these 11 that are building big power plants in the desert, brought in $278 million in venture capital in the second quarter. That brings their year-to-date total to $543 million.

Algae-to-fuel companies (there’s also a lot of those, see these 15) raised $84 million for the quarter, including a $50 million round for Sapphire Energy, which the report says is “the single largest round ever raised by an algae company.” Cellulosic ethanol companies like Range Fuels, EdeniQ, Mascoma, and Gevo raised $136 million for the quarter (see these 11 companies building next-gen cellulosic ethanol plants).

The report also has our favorite list, which lays out the top VC cleantech investors and where their money is going:

  1. Kleiner Perkins Caulfield & Byers: 5 investments, Segway, Lehigh Technologies, Amyris Biotechnologies, Verdiem, Jiangxi Tianren Ecological Industry Co.
  2. Foundation Capital: 4 investments, Control4, Silver Spring Networks, eMeter, SunRun
  3. Quercus Trust: 4 investments, Firefly, Standard Renewable Energy, Sencera, Hydro Green Energy
  4. Khosla Ventures: 4 investments, Amyris, Gevo, Firefly Energy, Range Fuels
  5. Draper Fisher Jurvetson: 3 investments, Brightsource Energy, EdeniQ, GreenFuel Technologies
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