Archive for the ‘Cleantech’ category

Cellulosic Ethanol taking off in USA

December 20, 2006

Cellulosic ethanol, the production of ethanol from a number of biomass products i.e. paper sludge, wood chips, switch grass and corn stover, is taking off in the US! Often referred to as the “holy grail” in biomass-to-ethanol, this new approach would allow to use various input sources, not just expensive corn or crops.

One of our Cleantech portfolio companies, Mascoma, operates in this exciting new market. The company (I have written about this new Atlas investment in the past) recently got a contract for $15m from the New York State to build and operate a demonstration facility. Thumbs up on this amazing achievement!

Takeaway: I am confident that European start-ups, entrepreneurs as well as venture capitalists will also embrace the huge opportunity around cellulosic ethanol!

Recommendation: If you are interested in the biomass market in general, you should definitely check out the Biomass Europe in Berlin 2007.

Lilliputian Systems and MicroOptical get recognised as WEF Tech Pioneers 2007

December 14, 2006

Congratulations to two of our portfolio companies, who were nominated recently for the World Economic Forum Tech Pioneer Award 2007:

Lilliputian Systems, one of our Cleantech investments, developing micro-fuel cells for portable devices, Interview with Ken Lazarus, and

MicroOptical, providing a new “viewing” experience for digital content, Interview with Kip Kokinakis – No wonder, Paris Hilton love this product!

Congrats and well deserved to both companies!

SAM Private Equity becomes Emerald Technology Ventures

December 14, 2006

SAM Private Equity announced yesterday, that due to the recent “merger” of Robeco and SAM Group, the private equity arm of SAM is buying out the entire private equity business to create Emerald Technologies. SAM Private Equity is one of the leading Cleantech oriented VCs managing 3 funds with a total of €250M in committed capital under management, 16 professionals, 26 portfolio companies and with offices in Europe and North America.

Takeaway: Good timing to spin-out the private equity business and establish a new stand-alone player in the Cleantech space. Recent exits in the Cleantech space are attracting more and more interest from the public markets, fueling the inflow of additional capital into the VC industry. Now we all need to deliver on these promises!

BASF fuels its product offering with Pemeas Fuel Cell Technologies

December 14, 2006

A ping by one of the people close to Pemeas Fuel Cell Technologies has alerted me to the recent announcement that BASF is buying Pemeas Full Cell Technologies, a leading company in the fuel cell business. Pemeas was founded in April 2004 as a spin-off of the former Hoechst Group’s fuel cell activities. The company has approximately 50 employees and operates manufacturing and R&D facilities in Germany and in the U.S. The company’s product can be used, for example, in portable electronics, residential applications or backup power systems.

According to industry analysts, the global fuel cell market will grow from €1 billion in 2010 to €21.5 billion in 2020. Fuel cells are environmentally friendly and can operate with a variety of fuels. They can also be used in a wide variety of applications, such as in laptop computers, homes and cars.

Takeaway: From what I heard, the company was considering a listing on the stock exchange in the near future, now the acquisition by BASF comes as a bold move to take advantage of top cleantech technology made in Germany. Good move and congrats to the VC investors BankInvest and SAM Private Equity.

Recommendations: We need more of these cleantech investment / exits here in Europe! The exit channels – no matter if public markets or M&A transactions – are out there!

Another Cleantech IPO in Germany!

November 16, 2006

Almost unnoted by many here in Germany was the recent IPO by Petrotec, a producer of bio-diesel based on renewable resources (various forms of natural or chemical substances, oil etc.). In 2005, the company delivered revenues of €40.5M and an EBITDA of €8M, and now has a market cap of €180M.

The global market for bio-diesel is poised for explosive growth in the next ten years. Although Europe currently represents 90% of global bio-diesel consumption and production, the U.S. is now ramping up production at a faster rate than Europe. Currently, Germany still has a leading position in the consumption of Bio-Diesel here in Europe (see chart below):

The bio-diesel market, especially here in Europe , has gone through various ups and downs in the last couple of years. Recently, the legislative changes in several countries have lead to a reduction of subsidies, which could potentially hamper demand in these markets.

For example in June of 2006, German legislation was adopted in order to tax bio-diesel going forward:

“Für Biodiesel und Pflanzenöl soll ab 2012 der volle Mineralölsteuersatz gelten. Reiner Biodiesel wird ab August 2006 mit neun Cent pro Liter besteuert. In Stufen von sechs Cent wird die Steuer ab 2008 jedes Jahr bis 2011 erhöht. Ab 2012 greift dann ein Steuersatz von 45 Cent. Er liegt damit zwar um zwei Cent unter dem Satz für fossile Brennstoffe, allerdings ist der Brennwert von Biosprit auch entsprechend geringer. Auch reines Pflanzenöl, das zunächst steuerfrei bleiben sollte, wird ab 2008 in Stufen von acht Cent besteuert.”

Takeaway: After the solar / photovoltaic market, the bio-ethanol / bio-diesel market might be the next big wave in cleantech. The favourable feed-in-tariffs in Europe, especially in Germany , have not only led to an enormous market uptake BUT to an unprecedented increase in innovation and new technologies. Many successful start-ups have grown up and did successful IPOs in the past few years. Bio-Fuel could be another of these opportunities for Germany to spur innovation, if legislation remains favourable and if venture capitalists continue to invest in these emerging areas.

Mascoma – revolutionizing the Ethanol market!

November 13, 2006

mascoma2.bmp

Mascoma Corporation is a promising start-uptrying to become the first commercial developer of cellulosic ethanol. Atlas Venture joined the recent financingroundtogether with follow investors General Catalyst Partners, Kleiner Perkins Caufield & Byers, Vantage Point Venture Partners, and Pinnacle Ventures, as well as existinginvestors Khosla Ventures and Flagship Ventures.

Current ethanol demand today is around 4B gallons, estimated to grow to 9.0b in 2011 in the US alone. This demand is federally mandated and also being driven by (1) phasing out MBTE as oxygenate; (2) increasing gas prices; (3) increasing tax subsidies.

Today ethanol in the U.S. is made primarily from corn, a resource with multiple uses with limits to its long term capacity. If all the corn in the US was converted to ethanol it would lead to only 12% of fuel requirements. The economics of corn feedstock limit continued growth for continued corn based ethanol.

Ethanol made from cellulosic biomass (e.g. grass, wood, and various agricultural and forestry wastes) – seen by many experts as the holy grail in the Ethanol market – takes advantage of significantly lower raw material cost, more plentiful and varied feedstocks, and expands the potential for ethanol to blend with and displace gasoline with a cleaner, renewable, domestically-produced liquid fuel.

Jeff Fagnan, Partner in charge at Atlas Venture for the Mascoma investment, believes that: “Cellulosic ethanol is widely viewed as the future of ethanol given the cheaper and more abundant feedstock it uses. Mascoma, based on its novel approach and its strong, experienced management team, has great potential to become the leader in this fast growing, multi-billion dollar bio fuels market.”

Takeaway: After the photovoltaic / solar market boom, the ethanol / bio-diesel market could potentially be another market with rapid future growth and subsequent technical innovation, triggering further start-ups as well as investments from the venture community.

Conergy to invest €250M in PV module plant!

November 13, 2006

What a surprise! Conergy recently announced the investment of €250M into a PV module manufacturing plant! Conergy, in the past focused on system integration, installation and distribution, now joins the ranks of the cell and module manufacturers.

Laut Unternehmensangaben vom Sonntag entsteht damit die weltweit erste vollintegrierte Massenproduktion, die vom Wafer über die Zelle bis zum Modul reicht. Mittelfristig werde Conergy mehr als 1.000 Arbeitsplätze schaffen.Mit dem Vorhaben sichere sich Conergy die Kosten- und die Qualitätsführerschaft auf dem Weltmarkt und schafft die Basis für weiteres dynamisches Wachstum im Kerngeschäft. Das Projekt werde mit einem syndizierten Kredit finanziert. Mittel für die weitere Expansion des Unternehmens würden nicht in Anspruch genommen.Die ersten Module mit einer Gesamtleistung von mehr als 50 MW sollen in Frankfurt in der zweiten Jahreshälfte 2007 vom Band laufen. 2008 werde die Produktionskapazität von 300 MW bei Wafern, 275 MW bei Zellen und 250 MW bei Solarmodulen erreicht. Ziel bei monokristallinen Modulen sei ein Wirkungsgrad von über 17%. (Source: Dow Jones)

Takeaway: This is a bold move by a player, who traditionally was focused on the downstream parts of the PV value chain. Moving now upstream means increased competition with established cell manufacturers such as Q-Cells or emerging thin-film cell / module start-ups such as Miasole. The strategy follows existing examples such as Solarworld, who cover the whole value chain from the raw material, to cell and module manufacturing to integration into the final PV system. Consolidation will clearly affect the PV value chain as well, but it remains to be seen how quickly companies such as Conergy are able to become technology and cost leaders in all (most competitive) parts of the value chain.

Recommendation: The continuous growth and demand in the PV market is spurring innovation and investments in this emerging, promising industry. There are lots of opportunities out there to succeed as a swift, innovative start-up with novel technology, as all established players have to remain on their toes in terms of competitive advantage and cost leadership.