Cleantech VC Investing Takes a Nose Dive Q1 '09

As expected, cleantech venture capital investing in the first quarter of 2009 looks as bad as Ugly Betty, with none of the charm. According to the Cleantech Group, worldwide cleantech venture investment in the first quarter of this year was $1 billion, which is a drop of 41 percent from the last quarter of 2008 and 48 percent from the same quarter a year ago. There wasn’t a single $100 million round, which the Cleantech Group calls “very unusual.”

In the barren quarter, solar came out on top with $346 million in funding — more than a third of all cleantech investment for the quarter. Biofuels brought in $96 million, advanced batteries delivered $94 million, and electric vehicles generated $78 million.

Of course, all this bad news comes before tens of billions from the stimulus funds, the budget and the energy bill start sprinkling loans and grants to eager firms. The federal government shouldn’t necessarily act as a green VC, but cleantech firms certainly need a helping hand in this environment.