Fundraising activity appears to be on an upswing in the alternative energy business, with 603 venture and private equity firms worldwide prepared to invest.
At least 83 industry-focused funds are out now seeking $23.5 billion in new capital, according to a study released this week by Preqin. (Please see accompanying Preqin chart.)
Equally interesting is their broad geographic diversity. Firms are spread evenly about the world, with a little over a third in North America and Europe each, and 28% in Asia and the rest of the world. Those setting up shop in Asia and the rest of world rose sharply in number in the past year, as places such as Mumbai and Singapore have become hubs of activity.
The pick-up in fundraising suggests a boost in future investing. It also follows a lackluster 2010, when fundraising dropped back to 2006 levels. Cleantech-focused funds raised only $2.8 billion last year compared with $6.9 billion in 2009.
The investment enthusiasm also appears to be healthy among more broadly focused funds. Preqin identified 223 funds with at least some cleantech focus in the market now seeking $80 billion in fresh capital. This compares favorably with 2008, when these more diversified funds with some cleantech interest raised $54.8 billion, a peak year.
The Preqin study suggests many fund managers will meet with success. Interviews with 100 investors discovered about a third interested in making commitments to cleantech funds this year and an additional 8% looking to do so next year.
Of the 603 private equity firms playing in cleantech, 65% are venture firms and 18% have an infrastructure focus. The remaining 17% are buyout firms.