I do think that the overall VC dollars will drop, but that will be in part because valuations will temporarily come down as part of the economic environment. I think that green start ups will still get funding and will be giving up the same equity for less money. And while venture funds will struggle to raise capital from limited partners, most of that fund raising wouldn't have an impact for some time from an investment standpoint anyway. Most VCs will still be closing out healthy funds for the next 6-12 months and that means it is a great time to be a VC.
What does this mean for green marketers and PR professionals? Maybe not much long term. As I have mentioned in the past, I am a big believer that the federal government will be a much bigger player in renewables in the future including agency grants and appropriations. Legislation and regulatory compliance will also help drive spending on green technologies. Call it Green Regs and Ham (pork sounds so dirty, especially since cleantech has a halo right now in government eyes).
Savvy management teams will offset any loss in VC capital with a government relations push that can result in some sort of grant with no loss of equity or IP. If you are a green marketer or PR professional looking to protect your cleantech PR budget amid growing competition, suggesting a GR program may be a means to more means.
Quick Note: We'll be hosting a webinar on the intersection of public relations and government relations for green and cleantech companies on Wednesday, November 12, 2008. You can register here.
I was watching a CNN political roundtable the other night (Larry King or AC 360) and one of the guests was Joe Klein, a TIME Magazine journalist that just had an interview with Obama (which was published today). He said something that wasn’t explored by the host or other panelists, but I felt was monumental for both its specificity and its implications. Here is the quote from the piece:
"The engine of economic growth for the past 20 years is not going to be there for the next 20. That was consumer spending. Basically, we turbocharged this economy based on cheap credit." But the days of easy credit are over, Obama said, "because there is too much deleveraging taking place, too much debt." A new economic turbocharger is going to have to be found, and "there is no better potential driver that pervades all aspects of our economy than a new energy economy ... That's going to be my No. 1 priority when I get into office."
Lots of arrows have been flung at both candidates for the lack of specifics around their economic plans and priorities should they be elected. This comment from Obama was about as specific as it gets.
So what does it mean for cleantech companies and the green PR firms that work with them? It means that the ITC and PTC extensions were just the tip of the iceberg (not making a climate change pun) and that an Obama administration would make renewable energy investment and development his number one goal over his first four years as president.
This means more legislation and agency investment in renewable energy projects and a much bigger market for cleantech companies. This could be the funding stopgap that companies need should the VC market begin drying up and means that integrated GR/PR campaigns could become much more critical in the next five months.
Bottom line: This is a very, very good thing for the market.
Quick Note: We'll be hosting a webinar on the intersection of public relations and government relations for green and cleantech companies on Wednesday, November 12, 2008. You can register here.
According to BusinessWeek (warning: I'm also plugging the green efforts of Schwartz client Foodservicewarehouse.com), "the hard times can also be an opportunity to advance one's career—or at least show the boss that you are worth hanging onto." Savvy, recent grad Ashley Howard of Foodservicewarehouse.com did it by becoming accredited to council commercial kitchen operators in using the company's green certification program and turning it into valuable Leadership in Energy and Environmental Design (LEED) points.
As we face economic uncertainty and job loss, the passing of the ITC and stories like Ashley's fill me with hope for the future. It's a hope I happily share with everyone I meet, especially those looking for a new career path. Last Sunday I took a cab to a friend's BBQ (it was tough to access by public transit and I was late, but enough with my green guilt) and my driver started telling me how he hated being a cabbie. We talked about the difficulty of starting a new career—whether you're 22 or 42 (which was his age). He did have one idea though; taking a few electrician courses at SF City College, which he would begin winter semester. He explained that he had read about the solar industry and it looked like "the next best thing since drilling for oil, and a lot better for the planet too." We enjoyed a lively dialogue about the business, which installers were here in the Bay Area and spots where he might find on-the-job training.
Before I paid him and left the cab, he turned around and said he had a confession to make: He had been driving a cab for seven years, but before that had lost 17 years to a heroin addiction. In his words, "I'm sick of wasting time and I want to do something that matters." And though I didn't think to say it in the moment, I wish I had told him that it all may have been perfectly timed. I think he and many others will find a happier place in this green economy.
The Solar Power International event last week was a fantastic show. Interest in solar is at an all-time high and the conference was well attended as a result.
I am not suggesting that there is a bubble in cleantech. I’ve written many times in the past about how we’ve only scratched the surface of the market potential, especially with a new federal regulatory and legislative climate taking shape for the next four years (more on that later).
I get the sense that the broader world at large is beginning to realize that cleantech can fuel the next stage of job growth in this country, as it puts white collar and blue collar people back to work in Green Collar Jobs. Whether you workin in board rooms, finance, human resources, manufacturing and engineering, or as a roofer, welder, contractor, etc., chances are your job is going to get Greener soon.
Quick Note: We'll be hosting a webinar on the intersection of public relations and government relations for green and cleantech companies on Wednesday, November 12, 2008. You can register here.
There likely will be a mixed mood when Solar Power International kicks off tomorrow. On the one hand, rejoice at the extesion of the ITC (invetsment tax credits) and PTC (production tax credits). On the other, fear about the impact that a recession and dropping oil prices will have on the economy. VentureBeat does a great job summing it up here.
I am an optimistic person to begin with, but I honestly think there is a wild card here: The Presidential election. Obama sees renewable energy as not just an economic or oil-price issue, but as an economic and geopolitical one. Ten years ago an oil price dip may have been enough to stem the momentum, but with policy makers now accepting global warming as a real issue and seeing the impact of fossil-fuel dependence on geopolitical issues (Russia, Iraq/Iran, Venezuela, etc) there will still likely be some investment in Green. There are also plenty of projections related to the creation of jobs from the cleantech and green market, including solar, biofuel, electric car and wind manufacturing, solar and wind installation, and office jobs. Call it a Green New Deal.
McCain also has made the link between oil dependency and geopolitical issues. He just tends to favor domestic oil and gas exploration and harvesting as a major piece of the equation. Regardless, I think that there will be a commitment to renewable energy over the next four years that may help somewhat offset the impact of a recession.
So how does it impact cleantech and green PR professionals? If you have an early-stage product that isn't shipping then the tendency will likely be to hunker down, cut spend and try to ride it out. I am not saying that this is necessarily the right approach, but many will likely embrace it. If you are a company with shipping product or a solid pipeline, then turtling from a marketing perspective is dangerous since the last thing you want coming out of a recession is to be an unknown brand in an exploding market opportunity.
I'll be reporting from Solar Power International this week and will do my best to capture the mood of the companies involved.
Quick Note: We'll be hosting a webinar on the intersection of public relations and government relations for green and cleantech companies on Wednesday, November 12, 2008. You can register here.
With Solar Power International (formerly known as Solar Power 2008) under one week away, it will be interesting to see what topics take center stage at the event. Here are some quick predictions:
-Thin Film: No market has been a bigger investment darling than thin film manufacturing in 2008 and so it is pretty clear that there will be significant attention on emerging players in the market.
-Solar Concentrators: The big star of WIREC back in March will again be widely talked about at the event, as companies explore concentrators on thin film, new types of concentrators and other uses of the technology.
-Solar Inverters: One of the current bottlenecks of system efficiency, next generation inverters will allow you to improve the performance of each individual cell or string, eliminating mismatch losses.
-The ITC Extension: The single biggest boost for the US market in 2008 was the recent inclusion of the ITC extension in the bailout bill. The news will result in a much better market for Solar in 2009 with the promise of even more federal help likely after a new administration takes office in January.
-Investment: Green venture capital investment hit another record in Q3 and thin film took a huge portion of the money. Will the financial crisis finally have an impact in Q4 or will the march toward a $9 billion year continue?
Quick Note: We'll be hosting a webinar on the intersection of public relations and government relations for green and cleantech companies on Wednesday, November 12, 2008. You can register here.
Happy day for the Cleantech and Green Market as Congress did what everyone was hoping and extended the Investment Tax Credit and the Production Tax Credit. Earth2Tech gives a good rundown of the joy in Greenville and what is included in the bill. It ends an emotional and long battle to get renewed Federal support for renewable energy.
Quick Note: We'll be hosting a webinar on the intersection of public relations and government relations for green and cleantech companies on Wednesday, November 12, 2008. You can register here.
A lot of folks have been upset with the House of Representatives sudden embrace of fiscal responsibility and as a result, the lack of approval for a Senate bill last week that would have extended the production tax credit and investment tax credit. Now some are grumbling that the inclusion of the ITCs and PTCs in the rescue or bailout bill is also not ideal.
So people fall into two camps: those that want a fiscally sound, stand-on-its-merits bill and those that think ANY bill that extends the ITCs and PTCs is a good thing. It is an interesting debate, although one that is probably moot with the likely passage of the bailout bill today.
I can honestly say that this is the most anticipated piece of public policy in the more than 10 years I have been in PR and certainly the most antipcated by green and cleantech PR agencies in the recent development of the market.
Quick Note: We'll be hosting a webinar on the intersection of public relations and government relations for green and cleantech companies on Wednesday, November 12, 2008. You can register here.
What financial crisis? Cleantech investing hit another record in Q3 as money poured into the market at a clip of $2.6 billion (thanks, Cleantech Group). Amazingly, I still am not among those that thinks there is a Green Bubble since this trend has largely been unsupported by the Federal Government.
Yes the ITCs and PTCs have been good for the industry, but with a new administration and bigger Democratic majorities in the House and Senate, I think we have only scratched the surface of advancement and adoption. When you also throw in a weakening economy, a weak dollar and technology bottlenecks yet to be solved, like energy storage, it is plain to see that greener days are ahead.
Quick Note: We'll be hosting a webinar on the intersection of public relations and government relations for green and cleantech companies on Wednesday, November 12, 2008. You can register here.
The bill is expected to pass through the Senate quickly and has a number of other popular additions (including the alternative minimum tax) that they hope will get more House support. I can't imagine Bush not signing the bill if it makes it to his desk unchanged.
This is a critical week for the solar, wind and other industries, as well as for cleantech and green PR agencies, law firms, VCs and every other market that services them.
Quick Note: We'll be hosting a webinar on the intersection of public relations and government relations for green and cleantech companies on Wednesday, November 12, 2008. You can register here.
