Greentech has historically been a hot-and-cold area for VCs due to the industry’s capital-intensive nature, long timelines for returns, and inherent risk. Using CB Insights data, we see that funding into VC-backed greentech companies reached a peak in 2011, with more than $5.8B invested across 374 deals. However, Solyndra’s collapse in late 2011 caused investors to lose confidence in the sector as a whole, resulting in two years of decreased funding and deals. 2013 saw a 41% decrease in deals and 62% decrease in dollars compared to the 2011 peak. 2014 saw a slight uptick in deals and dollars, but Q1’15 has been off to a slow start with less than $450M invested across more than 45 deals.
Deals into VC-backed companies were stage-agnostic in 2014 after 3 years of concentration in mid-stage deals. The biggest jump was in Series E+, which doubled its share of the number of deals between 2013 and 2014 to take 12% of total deals in 2014. Growth in the late stage has remained consistent in Q1’15, with more than 15% of deals happening in Series E+, while early-stage hit a low taking less than 25% of total deal-share in the past quarter.Similar to deals, late-stage dollar-share saw a bump in 2014. Late-stage deals accounted for a cumulative 47% of dollars into VC-backed greentech companies in 2014, after a drop the previous year to 33%. 2015 has already seen 31% of greentech dollar share go into Series E+ deals, including investments in View and Chromatin. On an industry-category level, renewable investments have taken nearly a third of total deals since 2010. Nearly half of the deals in renewables have been in solar companies, including now-public SolarCity and unicorn-club member SunRun. Internet software & services was the second largest category by deal share, taking 8% of deals since 2010, with the top deals focused on energy-analytics and agriculture-data companies.
In terms of dollar share, renewable companies took nearly half of all dollars going into VC-backed greentech companies, most likely due to the industry’s higher capital necessities. The rest of the dollars were relatively evenly spread out among other industry categories.
Since 2010, Kleiner Perkins Caufield & Byers has been the most active investor in greentech with more than 40 investments. However, in 2013 KPCB shifted away from greentech and has only invested in 6 companies since then. Khosla Ventures, another prominent proponent of greentech, took second place, with investments in more than 30 companies, but only 4 of which have come since 2013. Six firms have made investments in more than 20 companies since 2010.
|1||Kleiner Perkins Caufield & Byers|
|3||New Enterprise Associates|
|4||RockPort Capital Partners|
|4||Braemar Energy Ventures|
|4||Draper Fisher Jurvetson|
|7||VantagePoint Capital Partners|
|8||Mitsui & Co. Global Investment|
*Analysis did not include debt or grant rounds
Want more financing data about greentech? Check out our venture capital database belowIf you aren’t already a client, sign up for a free trial to learn more about our platform.