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Clean tech attracts record VC investments
By siliconindia
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Friday, 08 January 2010, 18:17 IST |
7 Comments
Bangalore: Though the overall venture capital (VC) investments in clean technology firms dropped last year due to the economic slowdown, the investment in low carbon technologies is increasingly dominating the private equity sector. According to a study by analyst firm Cleantech Group and consultancy firm Deloitte, while total VC investment in clean tech globally fell 33 percent during 2009 to $5.64 billion, the number of deals held steady, with 557 firms enjoying fresh venture capital funding, reports BusinessGreen.
The study said that based on the trends in previous years, the overall total will rise between five and 10 percent once investors fully announce their fourth quarter activity, which signifies that 2009 is likely to emerge as a record year for the number of deals. In addition, while the total amount of money invested has slipped back to 2007 levels, VC investment across all sectors has fallen back to 2003 levels, according to the U.S. Venture Capital Association.
According to Nicholas Parker, Executive Chairman of the Cleantech Group, the record level of VC activity provided evidence that the market for clean technologies would continue to grow, regardless of the disappointing outcome from last month's Copenhagen Summit. "In parallel with trying to reach carbon agreements, governments spent the year earmarking hundreds of billions of dollars for clean technology in pursuit of economic growth," he said.
The dominance of U.S. in the clean tech sector has slipped, accounting only for 62 percent of all VC invested in clean tech firms in 2009, compared to 72 percent the previous year. In contrast, Europe and Israel strengthened its position with their share of the market rising from 22 to 29 percent. China and India similarly saw their share of global clean tech investment rise to six and three percent respectively.
