Clean tech VCs putting money on solar, not IPOs

A survey of Silicon Valley investors points to their favored clean technologies and exit strategies.

Clean tech venture capitalists, known as a sunny, optimistic bunch, are finding a lot to like in solar.

A survey done by legal firm Cooley Godward Kronish found that clean tech investors believe that solar has the most long-term profit potential over the next five years, followed by "energy intelligence," or smart grid technologies. After that came biofuels and wind in terms of economic attractiveness.

Initial public offerings--which have been few and far between in IT for several years--do not appear to be the most common route to cash in.

Only 10 percent of the 75 Silicon Valley investors queried said that IPOs would be a viable exit strategy. Acquisition by another clean tech company, energy provider or utility was the most likely, according to the survey.

There have already been IPOs from clean tech firms this year including Comverge which sells systems for automatically adjusting thermostats for energy efficiency. Ocean Power Technologies, which generates electricity from ocean waves, also went public this year.

Many people have questioned whether the investment boom in clean tech is leading to a bubble.

The survey's investors, perhaps not surprisingly, appeared to be convinced that demand will continue, fueled by consumers, government mandates and policies, and innovation.

 

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