Cleantech Investment Rises Again

It’s still a great time to be a clean technology company seeking funding, according to data released today from the quarterly MoneyTree Survey. The cleantech sector reached an all-time quarterly high in investment dollars in the three-month period ended June 30, with $883.6 million going into 65 deals, according to the report from PricewaterhouseCoopers and the National Venture Capital Association based on data provided by Thomson Reuters.

This dollar figure represents a slight increase from the first quarter, when $870.9 million went into 60 deals, and a whopping 62 percent rise over the $544.4 million dollars that went into 53 companies during the second quarter of 2007. And the top two deals involved clean technology companies: OptiSolar, which captured $132 million (and far more than the $38 million we had noted back in April), and BrightSource, which raised $115 million.

Notably, Thomson Reuters changed its definition of cleantech this quarter to include more companies; it also changed the historical data to reflect the category change.

Cleantech companies are faring better than the overall venture climate, which stayed flat from the previous quarter and flat compared with the second quarter in 2007. Venture capitalists invested $7.39 billion in 990 deals in the second quarter of 2008, while in the first quarter, $7.5 billion was invested in 977 deals. For the second quarter of 2007, VCs placed $7.37 billion into 1,033 deals.

Cleantech is a growth area for venture firms; it comprised half of the industrial and energy segment deals in the latest three-month period. Trevor Loy, a managing partner with Flywheel Ventures, a seed-stage firm focused on clean tech and hardware deals, said the investments are now moving beyond renewable energy into categories such as clean building trends, petrochemicals and devices that use less energy. Water is also a big interest for Flywheel as the firm believes it will grow in importance as a resource over the next 10-20 years.