Seed financing needs disruptive innovation You cant discover

  • Slides: 13
Download presentation
Seed financing needs disruptive innovation You can’t discover new oceans unless you lose sight

Seed financing needs disruptive innovation You can’t discover new oceans unless you lose sight of the shore

Investment market (I) Cleantech market Clean Energy Technology (CET) is a growth market that

Investment market (I) Cleantech market Clean Energy Technology (CET) is a growth market that is expected to reach EUR 1. 6 trillion by 2020 and thus is an attractive business opportunity Source: Clean Economy Living Planet, Roland Berger Strategy Consultants 2

Investment market (II) Transaction market Industry sale Private Equity There were 154 cleantech M&A

Investment market (II) Transaction market Industry sale Private Equity There were 154 cleantech M&A deals in 3 Q 10 totaling $4. 5 billion. While the volume of deals in 3 Q 10 declined, there is reason to believe that the buoyancy being seen in the wider M&A market may begin to show through during upcoming quarters. Cleantech predicts a full-year total for 2010 of about $7. 3 billion, which would be the second largest annual total ever. The deal number does however look set to exceed 650, a new annual record. Source: Cleantech Market Insights Database 3

Regional Focus European and Israeli companies raised $381 million in 66 VC rounds, down

Regional Focus European and Israeli companies raised $381 million in 66 VC rounds, down 22% from 2 Q 10 in terms of amount invested but up 12% in terms of deals done. This underlines the capital-efficient nature of European cleantech venture investing Source: Cleantech Market Insights Database 4

Startup financing cycle Finish? Seed funds Banks Start Grants / “soft loans’ 5

Startup financing cycle Finish? Seed funds Banks Start Grants / “soft loans’ 5

Start Green Venture Capital Economic development Contribution to economic activity Value Realized a turnover

Start Green Venture Capital Economic development Contribution to economic activity Value Realized a turnover of EUR 16 million in 2009; Employment for 92 employees, a growth of 80% since the start; Development of 35 new, innovative products; 13 new patents & 6 unique IPR positions on IT development; Additional € 7 million bank loan / financing facilities achieved 2006 2010 Year 6

Lessons of eco-innovation From a Venture Capital perspective • • The technology roadmap: think

Lessons of eco-innovation From a Venture Capital perspective • • The technology roadmap: think big, start small and upscale quickly IPR policy based on PMC’s (product market combinations) Strong guidance & monitoring on finance, business focus and team development New management after 2 -4 years Realize economics of scale (gross margin improvement) Start directly with strategic alliances with strong partners Built companies; IPR exits are second bests 7

Barriers (I) For cleantech startups • • • The entrepreneurs (United States versus European

Barriers (I) For cleantech startups • • • The entrepreneurs (United States versus European Union) Strong market resistance (institutionalized, overregulated, 110% reliability) Level playing field necessary Growth equity gap (€ 2 -5 million) Corporations don’t innovate, they consume innovation Universities seldom develop commercial IPR, but we need lots of research…. 8

Technology Commercialization Funnel Independently commercialized (founders, angels, seed, grant) (500 - 1000) VC candidates

Technology Commercialization Funnel Independently commercialized (founders, angels, seed, grant) (500 - 1000) VC candidates (100) Research (government, university, corporate, other) (X 000 s) 9 VC invested (3) Successful Exit (1)

Barriers (II) For Venture Capital Funds • • Overall scarcity of liquidity: fundraising takes

Barriers (II) For Venture Capital Funds • • Overall scarcity of liquidity: fundraising takes 2 -3 years Regular finance engine’s for Venture Capital / Private Equity are hesitating: Bank/ insurers and pension funds VC- Incentive programs are structured nationally: with non or small options for investments abroad (SEED facility NL, Arcimedes BE, ……GE, e. g. ) Trend to harmonize EU finance regulation for PE to VC sector 10

Institutional changes EU opportunities • • • EU regulation (almost comparable): harmonize certification Create

Institutional changes EU opportunities • • • EU regulation (almost comparable): harmonize certification Create entrepreneurs-hub, entrepreneurs for entrepreneurs (in EU) knowledge center/Exchange Feed-in (or ‘omslagstelsel’) Create cleantech consumer market (low VAT) Level playing field, account environmental costs (pollution) into products! 11

Contact Start Green Venture Capital Flevolaan 41 1411 KC Naarden The Netherlands Telephone: +31

Contact Start Green Venture Capital Flevolaan 41 1411 KC Naarden The Netherlands Telephone: +31 (0)35 6958 110 Fax: +31 (0)35 6958 120 Email: info@startgreen. nl Website: www. startgreen. nl

Start Green Investment portfolio Sustainable technologies Consumer products Energy Home - Generation Energy -

Start Green Investment portfolio Sustainable technologies Consumer products Energy Home - Generation Energy - Storage Generation - Distribution - Trading IT Bridges & support structures Consumer electronics Logistics 13