Cleantech Partly to Blame for the Lack of Venture-Backed IPOs

Looks like venture capitalists’ attempts to “go green” mean there are fewer venture-backed IPOs out there. Not a single venture-backed company went public in the second quarter of this year, says the New York Times this weekend, citing data from the National Venture Capital Association. And the article says that the fact that venture firms have increasingly invested in cleantech companies, which take longer to mature and reach the public markets, is partly to blame.

. . . the pipeline for public offerings has dried up in part because of the considerable shift in the industry’s interest in the last three years into “green” technologies, which was taking time to bear fruit.

Two things are possible in this scenario. First, those expected cleantech IPOs are just not gonna come. The venture investing model could prove to not be as compatible with industries like energy and transportation, as it has been for infotech. Or more cleantech IPOs are on their way, but, as the article suggests, the companies are taking longer to mature.

Either way, the finding is not something that is going to encourage more venture firms to get into cleantech investing. As venture watcher (and one of our favorite blog reads) Paul Kedrosky says to the New York Times: “There is no venture industry if there is no I.P.O. market.”