Cleantech's Solar Conundrum

Tags: solar, green tech, cleantech, venture capital
2 Jan 9:56am
Posted by CleantechBlog
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The solar market is still going strong, despite the financial crisis, and turmoil in some of its key markets. But that doesn't mean all is well on the venture financing end.

As a number of longtime Silicon Valley solar darlings start to demand even more serious money to build plants for commercialization, the financing picture gets clouded. Conventional wisdom has been suggesting it's market issues. Maybe so, and then again, maybe not.

Greentech Media has been reporting on the funding efforts of Solyndra, including a recent discussion of struggles by Goldman Sachs to raise structured finance for the startup, which claims it is shipping some of its very weird looking CIGS product, though little evidence let alone field data exists.

It's not the only one. Recently CPV darling SolFocus was reportedly struggling to raise capital arranged by Advanced Equities. The cash was to fund the buildout of a commercial manufacturing plant, and at least twice the company drastically cut its pre money valuation ask.

The conventional wisdom is that the finance crunch is hurting solar. I have another thought. Perhaps its just the riskiest solar technologies and businesses coming home to roost. Both of these companies have been pitched to investors as late stage, helping to justify massive capital needs and valuations. I'd argue they are actually very, very early stage, with all the risk still in front of them.

Maybe it's not the market? Maybe its the ludicrous suggestion that the first plant should be 420 MW in size. How about two new ideas: 1) Stage gate, or 2) Walk before you run.

Take Solyndra, which has raised hundreds of millions to coat CIGS on a glass cylinder. Perhaps the question shouldn't be is solar getting hurt by the credit crunch, but should be who exactly thinks its a good idea to invest hundreds of millions to build a plant to coat CIGS in a circle, at "pre IPO style prices"? The question everyone I know has been asking is, if they really can coat CIGS with good yields, why didn't they just do it? That's world beating on flat plate glass, if it works as advertised. Why wrap the same amount of solar material around a long glass paper towel roll?

With SolFocus, maybe its just that CPV isn't as good an idea as applying manufacturing process improvement to CdTe and tandem cell thin film?

Who knows, but let's look a bit closer at the particular technologies before we just blame it on the the financial crisis.

Neal Dikeman is a partner at cleantech merchant bank Jane Capital Partners LLC, and Chairman and CEO of Carbonflow, Inc. He edits the Cleantech Blog and chairs Cleantech.org.
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Cleantech Blog was founded by Neal Dikeman, and all our columnists are experts in their fields. Some of them are available for media interviews and quotes, speaking engagements and consulting. You can find biographies, areas of expertise and contact information for the columnists who have agreed to be available for comments below. Contributing Columnists: * Neal Dikeman, Founder Cleantech Blog, Partner at Jane Capital Partners * Richard Stuebi, BP Fellow for Energy and Environmental Advancement, Cleveland Foundation * Heather Rae, President, Brae Consulting – Sustainability marketing expert * John Addison, Author of Clean Fleet Report, Director, California Hydrogen Business Council * Dr. Peter Beadle, CEO GreenJobs.com, former BP Solar exec Guest Contributors: * Joel Makower, World Leading Sustainability Advocate, Founder Clean Edge * Felix Kramer, Founder, CalCars.org * Nick Bruse, General Manager Clean Technology AustralAsia * Anne-Marie Fleming, President, Investor Ideas, and publisher of leading renewable energy stock web site * Mark Bitterman, Editor, Superconductor Week * Gerry Woolf, Editor, BEST Magazine We also welcome contact from PR firms looking to connect with green, sustainable, and cleantech bloggers. Neal Dikeman: I founded Cleantech Blog in 2005. I am a merchant banker and co-founder of Jane Capital Partners LLC, where I head the energy and environmental practice, and prior to that worked in venture capital, private equity and investment banking in the tech and energy sectors. We have co-founded four emrging startups in cleantech and IT (in superconductors, fuel cells, RF, and carbon credits) since the tech wreck, and advise the technology and venture investment arms of three multi-nationals. In all of it, I have been lucky enough to work with some amazing colleagues, bosses, and partners. Besides Cleantech Blog, I am a contributing editor of AltEnergyStocks.com, and contributing author to Inside Greentech. Along with our own, the blogs I regularly read include Jim Fraser's The Energy Blog, Rob Day's CleantechVC, Tyler Hamilton's Clean Break, Joel Makower's Two Steps Forward, and Inside Greentech. My areas of expertise are always a work in process, but I have been quoted, cited, or interviewed on energy, alternative energy, and cleantech issues by numerous online and print publications including Red Herring, Energy Intelligence, Time.com, Bloomberg, San Francisco Chronicle, Forbes.com, Ethical Investor, Wall Street Reporter, and FT.com among others, on topics ranging from: cleantech, solar, ethanol, blogging, technology commercialization, corporate venture investment, energy prices and policy, technology transfer, carbon trading, and renewable and alternative energy. Feel free to contact me at dikeman@janecapital.com. Mr. Richard T. Stuebi Richard Stuebi has nearly 20 years of experience as an executive, entrepreneur and consultant in the energy industry, with most of the past decade focused on advanced energy technologies. He is currently serving as the BP Fellow for Energy and Environmental Advancement at the Cleveland Foundation, one of the largest community foundations in the US with over $1.6 Billion in assets. He works with various public and private sector stakeholders to promote commercial activity in advanced energy in the Cleveland area. Mr. Stuebi has authored numerous articles that have appeared in such leading industry periodicals as The Electricity Journal and Public Utilities Fortnightly, and has presented at numerous major energy conferences. He is a contributing columnist to Cleantech Blog, writing on alternative energy issues, news and events. Prior to joining the Foundation, Richard founded NextWave Energy, a professional firm focused on capitalizing upon new business opportunities stemming from innovative energy technologies. As President of NextWave Energy, he assisted several emerging and established private-sector clients in various aspects of business development, including strategy and capital formation. Previously, Richard was a senior vice president at Louis Dreyfus, the global commodity trading firm and was a management consultant in the energy practice of McKinsey & Co. Richard earned degrees in economics from the Massachusetts Institute of Technology and Stanford University. His areas of expertise include: Economics in alternative and renewable energy, energy policy, trade, and development. Cleantech finance and technology strategy. You can contact him at rts@nextwave-energy.com. Ms. Heather Rae Heather is a green marketing expert and a long-time advocate of green technology and sustainable business. Through her consultancy Brae Consulting, Heather has worked for energy companies, cleantech startups, and nonprofits (she is currently working with a home energy efficiency program of the Maine Governor's office). Her previous corporate marketing experience includes Xcel Energy (demand-side management and green power) and Qwest Communications. A hands on expert - Heather has practiced what she preached. She is certified in high performance residential building (Green Advantage®) and has served as co-director of Colorado's Interfaith Power & Light. Readers of Cleantech Blog will know that Heather converted a retired school bus into the Brae Bio Bus, a recreational vehicle running on biodiesel (B100) with solar panels for auxiliary power, and recently drove it across the country blogging the experiences in finding biodiesel in different parts of the US. Having reached her destination at Maine Home Performance, a program of the Maine Governor's Office where Heather is helping design programs to certify and link Maine contractors with homeowners who want to "go green", Heather is now tackling the conversion of an 1880s Maine farmhouse into an energy efficiency and green showcase. Heather graduated from Wesleyan University and is a contributing columnist to Cleantech Blog writing on green and sustainable products and marketing from the consumer's point of view. Her areas of expertise include: Green marketing programs and strategies, grass roots green and sustainable programs for consumers, using green technologies in the home. You can contact her at heather.rae@braeconsulting.com Mr. John Addison John is an accomplished writer, speaker, and expert in technology marketing and strategy. He is one of the IT converts that are driving the cleantech industry. Since 1992, his marketing consultancy OPTIMARK, Inc. has provided educational programs, market intelligence, market development and partner development for technology and government leaders. A believer in cleantech's potential to change the world for the better, John is the Publisher of the Clean Fleet Report and serves on the Board of the California Hydrogen Business Council. He is a contributing columnist to Cleantech Blog. He is the author of the book Revenue Rocket on channel marketing in technology, and the upcoming book Save Gas, Save the Planet on what we as individuals can do to help save the planet. Earlier in his career John was an area channel manager for Sun Microsystems. For three years, he led a sales team to 300% annual growth in 15 states, increasing revenue from $4 to $110 million. He has taught courses about marketing and innovation at U.C. Davis and U.C. Santa Cruz Extension. He is a popular speaker in the Americas, Europe and Asia. You can find more of his speeches and articles on his websites Clean Fleet Report and Revenue Rocket. His areas of expertise include: Technology marketing and marketing strategy, channel marketing, fuel cells and the hydrogen economy, alternative fueled fleets, and California's energy tech corridor. You can contact him at johnaddison1@gmail.com. Dr. Peter Beadle Peter is the owner and CEO of GreenJobs.com. He is an is an experienced technology executive and an expert on a wide range of green and energy technologies, including photovoltaics, fuel processing, fuel cells, and oil & gas technologies. Green Jobs is one of the few dedicated job sites for the renewables and cleantech industry. They put out the online Green Directory, as well as a weekly newsletter on People News in cleantech. Peter is a contributing columnist to Cleantech Blog writing on renewable energy news and events. Peter holds a PhD in Physical Chemistry, and previously served President of BP Solar's North American division. Prior to that he held a number of positions in R&D and technology management within British Petroleum. His areas of expertise include: Solar, fuel cells, oil & gas, renewable energy job market You can contact him at Peter@greenjobs.com.

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