Wednesday, September 06, 2006

Clean tech, big money (and the JAMBOG trap)

Interesting news feature in the new Real Deals on VC funds specialising in clean technology, centred on a round table discussion involving three managers of such funds. As well as specialist funds, big players like 3i and Apax Partners are also increasing their exposure to the sector. As James Cameron of Climate Change Capital notes:
"Wind energy, solar energy and biofuels are each bigger markets globally, at $13bn, than e-commerce, at $11bn."
That's an eye-opening statistic, given the hype given to the likes of Amazon, and the continued disdain from some quarters for anything smacking of environmentalism or that dread word 'sustainability'.

There's also a piece by Real Deals editor Ross Butler on the importance (or otherwise) of regional offices for private equity firms. As I've noted in countless previous features, there's been a general retrenchment away from the regions, with a few firms such as Isis as notable counter-examples. Ross did ask me to write a side-piece for this article on the Leeds market, which unfortunately I couldn't fit into the schedule - mainly because I was deep into another long deals piece for the sister mag, Real Business, this time looking at expansion or development capital. That's a market that's been largely ignored in recent years, but many of the advisors and VCs I spoke to reckon that there's more money moving back in. In large part, that's because the VCs need to secure themselves a niche in a crowded market and not just be seen as JAMBOG - an acronym, we also learn from this RD, for 'just another mid-market buy-out group'.

Seems slightly odd that something as innovative as the latest clean technologies, and something as traditional as mid-market minority-stake development capital, are both seen as niches. Maybe it says more about the state of the mainstream.

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