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Move over Vinod Khosla, billionaire investor and philanthropist George Soros has his own billion dollars ready for clean power. This weekend Soros told a conference in Copenhagen that he plans to invest more than $1 billion of his own money into clean energy technology. His announcement is the latest move by a high profile investor who hasn’t commonly been connected to the cleantech space (it’s going mainstream!) and it offers another proof point that cleantech has emerged during the recession as one of the few sectors worth investing in.
Last month numbers from the Cleantech Group showed that clean technology, for the first time ever, had become the number 1 investment category in the U.S. in the third quarter of this year, moving ahead of biotech and IT investing. As TechCruch points out Vinod Khosla’s recent $1 billion raise (the majority of which will go to cleantech) made up the bulk of the funds raised for the entire venture capital industry. While these numbers say a lot about the venture investing industry in general (the numbers are still relatively low right now), cleantech is an area that has seen a massive amount of government funding (largely from the stimulus) and international attention. And there’s more supportive legislation in the works. This is an environment that investors clearly like.
Soros joins a list of other big wig celebrity investors that haven’t traditionally been connected to cleantech, including Warren Buffet, who invested in Chinese electric car maker BYD, and Richard Branson, with his Virgin Green Fund and $25 million carbon reduction contest. Of course former oil barren T. Boone Pickens got into the clean power and natural gas markets a while ago.
Soros has already made a couple investments in clean power, including clean coal company Powerspan, and cellulosic ethanol company Qteros. We can probably expect him to make more investments like those — later stage companies with large markets — as opposed to some of the early stage, high risk cleantech startups that Vinod Khosla and David Gelbaum have been looking for.
While Soros is a longtime philanthropist and policy advocate, he was clear that he’s looking at clean power from an investing standpoint. He told the conference in Copenhagen that “I will look for profitable opportunities, but I will also insist that the investments make a real contribution to solving the problem of climate change.” Soros also plans to open up a watchdog group called the Climate Policy Initiative, based in San Francisco, that will “protect the public interest against special interests.”
With any investor that plans to suddenly drop a whole lot of cash into the space, Soros will meet a steep learning curve. Here’s a tip: Study the previous investments of Vinod Khosla, who also invested his own money over the past several years and has seen mixed results.
Image courtesy of Flickr Creative Commons.