05/08/2007
Clean Technology Survey Reveals Most Profitable Sectors, Likely Exits for Cleantech Companies
Palo Alto, Calif. — May 8, 2007 — According to a recent survey of clean technology thought leaders conducted by law firm Cooley Godward Kronish LLP, emerging solar power and energy intelligence companies demonstrate the most long-term profit potential for investors. The survey, which gauged the factors that influence the advancements in cleantech, where the industry is headed, and which sectors will lead the cleantech advance, also revealed that the most likely exit strategy for a cleantech company is an acquisition by a larger energy or utility company.
Of the 75 cleantech entrepreneurs, investors and other sector-focused professionals surveyed, the majority are optimistic about the outlook for cleantech exit strategies: only 22 percent do not expect any cleantech IPO’s in the remainder of 2007, while 69 percent predict that between one and eight emerging cleantech companies will go public between now and the end of the year. However, overall, 28 percent of the respondents believe acquisition by an energy company is a more viable exit strategy for cleantech companies, versus the 10 percent who believe an IPO is more likely.
The respondents also note that they view the most promise for profits in solar (39 percent), energy intelligence or “smart grid” technology, (24 percent), biofuel (20 percent) and wind energy (15 percent).
“These are optimistic times for the entrepreneurs and investors who are at the forefront of the surge in the clean technology sector,” summarized Jim Fulton, head of Cooley’s emerging companies practice. “We are seeing confidence and excitement as a direct result of the healthy business environment and, more importantly, the demand for new clean and sustainable technologies.”
Other key findings include:
Innovation Leading the Charge
Respondents also weighed in on the key factors that are driving growth in the sector. Consumer demand, with 15 percent, was outweighed by nearly all other factors, including technology and innovation (23 percent) and oil and natural gas prices (20 percent) as the estimated top growth driver for the cleantech sector. Government mandates and incentives and federal and state policy each received 17 percent of the responses.
Future Starts Here
Nearly 65 percent of those surveyed believe the United States will continue to be the leading developer of clean technologies through 2012. Only nine percent named China and eight percent named India, as the future leader in innovation.
Investors Buy-In to Green Lifestyle
Those investing in and creating new technologies are also reducing their own carbon footprints. More than half of the respondents reported they are utilizing energy-efficient light bulbs and recycling more, and approximately 20 percent drive a hybrid vehicle. Only 4 percent have purchased carbon credits to offset their consumption.
Stephane Dupont, executive vice president of the National Venture Capital Association, said, “the agreement on behalf of those surveyed with respect to the future potential of the cleantech sectors is a welcome sign of the times and a validation that the United States will continue to lead in the development of renewables and clean technologies.”
The survey was conducted recently at a cleantech event sponsored by The Silicon Valley Association of Start Up Entrepreneurs (SVASE) at Cooley’s Palo Alto, California offices.
About the Cooley Godward Kronish’s Cleantech Practice
Cooley is a leader in working with investors and entrepreneurs who are developing innovative technologies, helping them bring their ideas to market. Cooley’s Clean Technologies attorneys are actively involved in various industry organizations, such as the Cleantech Venture Network and the Environmental Business Cluster. The group regularly organizes and sponsors events and conferences that promote networking and business opportunities for clients and others working in Clean Technologies.
About Cooley Godward Kronish LLP
Cooley Godward Kronish’s 580 attorneys have an entrepreneurial spirit and deep, substantive experience, and are committed to solving clients’ most challenging legal matters. From small companies with big ideas to international enterprises with diverse legal needs, Cooley Godward Kronish has the breadth of legal resources to enable companies of all sizes to seize opportunities in today’s global marketplace. The firm represents clients across a broad array of dynamic industry sectors, including technology, life sciences, financial services, retail and energy.
The firm has full-service offices in major commercial, government and technology centers: Palo Alto, CA, New York, NY, San Diego CA, San Francisco, CA, Reston, VA, Broomfield, CO and Washington, DC.
For additional information, please visit www.cooley.com.
Media Contact:
Zach Olsen
Infinite Public Relations
415-948-5913
zolsen@infinitepr.com