Survey: Cleantech VCs Are Bullish on Exits and New Deals

Most U.S. venture capitalists who invest in cleantech don’t believe the nations of world will do enough to slow climate change by 2020, but they are optimistic that the startup companies they finance will lead the way in creating technologies that reduce global warming.

Those were two of the takeaways of a recent survey of 41 cleantech investors by Reuters and Venture Capital Journal. (Complete results of the survey are available to VCJ subscribers here.)

“It is likely that we will make significant technology, conservation and policy gains globally … but material CO2 reductions will take an additional decade to register,” Don Wood, a managing director at Draper Fisher Jurvetson, wrote in one survey response.

Robert Nelsen, co-founder and managing director of Arch Venture Partners, noted that “the world has absolutely no hope of making any substantial impact on global warming without major scientific breakthroughs, almost all which will come from United States’ innovation. China and Europe are doing well developing markets and applications, but we [the United States] still own the fundamentals.”

More than three-fourths of the survey respondents said the United States would be the best market for cleantech over the next five years, and 88% said America was the best place to base a cleantech business in the next five years.  China ranked as the second best market (with 16 percent of the total) and the second best place to locate a cleantech business (with about 13 percent).

The survey respondents, most of whom are based in the United States, clearly recognize the critical role that other countries will play if widespread adoption of clean technologies is to be successful.

Countries such as China, India and Brazil “will adopt such technologies not just to combat climate change, but also because of the sheer energy demand their economies are generating,” wrote Bilal Zuberi, a principal with General Catalyst Partners. “Pressure from these countries will force the developed world to also adopt renewables and energy efficient technologies at a faster pace.”

A longer version of this story is available at Reuters.com.