On a sequential quarter-over-quarter basis, clean tech venture funding fell over $250 million between Q2 and Q3 2010. This represents a drop of 25%. When seeing these numbers in the CB Insights’ Q3 2010 quarterly venture capital report, it’s easy to see the funding drop and look at it through a pessimistic lens. This, in our view, misses the mark, especially because the quarter actually saw growth in the number of clean tech deals which grew almost 11% vs the prior quarter and at the second highest deal level in five quarters.
Green technology venture funding, unlike any other type of VC funding is the most subject to wild swings as we’ve seen in past quarters because of a couple large mega-deals. Throw in a large electric vehicle funding deal or a significant investment into a biofuel or solar company and the venture funding total can quickly jump, but a single large deal is less suggestive of a healthy clean technology investment landscape than a healthy level of venture deals is.