The tree-hugging sector has found its way back into the spotlight. A new report from the Cleantech Group, in conjunction with Deloitte & Touche, pegs venture capital in the cleantech sector up 29% from the fourth quarter of 2009 to the first quarter of this year -- and up 83% year over year. In fact, VC action in cleantech set a new record for the number of deals closed (the previous best, 165, was set in the prior quarter). A total of $1.9 billion was invested last quarter in 180 cleantech companies.

According to Sheeraz Haji, president of the Cleantech Group, "The first quarter's bounce back in terms of venture capital investment compared to 2009's early lows bodes well for what we think is in store for the remainder of the year." Haji continues, "North America was particularly dominant this quarter."

Continue reading Cleantech Sector Picks Up $1.9 Billion in Q1

Cleantech Sector Picks Up $1.9 Billion in Q1 originally appeared on BloggingStocks on Fri, 02 Apr 2010 11:20:00 EST. Please see our terms for use of feeds.

Venture capital funds aren't being terribly adventurous. In the U.S., they invested less capital in start-ups, a sign that uncertainty persists. Also, they're spreading the wealth: More companies are getting a taste, but in smaller doses. This tendency suggests that VC investors are diversifying as a way to test the waters for promising companies.

The situation is pretty straightforward: A difficult economy means that (a) start-ups will have trouble finding customers and (b) exit strategies for investors will be more difficult to attain and probably less lucrative. So, the risks of failure are higher, and the rewards are lower. As a result, VC investors need to be more cautious as they enter positions. Add to this the general financial market malaise we've experienced for the past year and a half -- longer if you trace the origins of the financial crisis to February 2007, with the agita at New Century Mortgage -- and now doesn't exactly seem like the time to place a handful of big, concentrated bets.

Continue reading More Deals, Less Money: Venture Capital Funding Drops More Than a Third

More Deals, Less Money: Venture Capital Funding Drops More Than a Third originally appeared on BloggingStocks on Mon, 25 Jan 2010 10:00:00 EST. Please see our terms for use of feeds.

Continue reading Cleantech Venture Funding Drops a Third, Still Beats the Rest

Cleantech Venture Funding Drops a Third, Still Beats the Rest originally appeared on BloggingStocks on Thu, 07 Jan 2010 09:30:00 EST. Please see our terms for use of feeds.

KaChing! KaChing!

It only makes sense to call a company a sound you like to hear. This is exactly what CEO and co-founder Andy Rachleff must have had in mind. His new company -- kaChing, of course -- is backed by Marc Andreesen (a name often associated with that sound) and Jeff Jordan, the CEO of OpenTable (NASDAQ: OPEN), two guys who usually do a solid job of backing winners. But, they've taken on a challenge by backing a company in the financial services industry.

Continue reading KaChing hopes to be the sound of success

KaChing hopes to be the sound of success originally appeared on BloggingStocks on Mon, 19 Oct 2009 12:00:00 EST. Please see our terms for use of feeds.

The amount of investable assets available to venture capital funds has basically been a growth story since 2003. Dry powder slipped 7% in 2004 and 10% in 2008, but increased in every other year over this period.

Now, the dry powder number sits at $155 billion, according to alternative investment research firm Preqin, just off its December 2007 peak of $160 billion. The big number, however, masks a wide range of market situations for venture capital funds. Dry powder levels vary by strategy and region. To get a sense of what's going on behind the scenes, check out the five facts below about venture capital dry powder.

Continue reading Five views of venture capital dry powder

Five views of venture capital dry powder originally appeared on BloggingStocks on Sun, 18 Oct 2009 13:40:00 EST. Please see our terms for use of feeds.

Well, what have you done for me lately, right? Investors, less than thrilled with the returns that venture capital funds have been delivering, are taking their money and going home. The number of new funds launching has thus dropped precipitously, and it looks like the industry will be smaller, with fewer players, according to the National Venture Capital Association.

Of course, the next wave will attract many to ride it, and that could be enough to turn the tide (once again).

Continue reading Investors turning their backs on VCs (for now)

Investors turning their backs on VCs (for now) originally appeared on BloggingStocks on Tue, 13 Oct 2009 13:10:00 EST. Please see our terms for use of feeds.

Investors have flocked to foreign exchange trading over the past 10 years, and the venture capital community is ready to grab a piece of the action.

Two companies -- Currensee Inc. and Tradonomi LLC -- are angling for central spots in this emerging trading community, and several funds are placing pretty big bets on their success. Currensee has a social network for forex traders, while Tradonomi's move was to create a game-like user interface to make it easier for would-be fortune-makers and thrill-seekers to trade foreign currencies.

Continue reading Venture capital funds finding forex cash

Venture capital funds finding forex cash originally appeared on BloggingStocks on Sun, 11 Oct 2009 14:10:00 EST. Please see our terms for use of feeds.

We're tired of bubbles, right? Anyone 30 or older has lived through two big ones so far, with a brief period of prosperity separating the decimation of dot-com largesse and mortgage-fueled paper wealth. It could take until 2014 for the jobs lost to be replenished, and there's little reason for optimism.

So, with the economy in the tank, we can focus elsewhere -- maybe on saving the planet. If we can't put green in our wallets, maybe we can add some to our lifestyles. Or, you could do both. Green technology could be the next boom in the United States, even if we do lag some parts of the world, and investing in clean solutions is really nothing other than investing in the next big thing. Even if you don't give a damn about climate change (or don't think it exists at all), the green market could likely become your employer -- or trigger the economic growth that will create your next job.

Some signs are visible already.

Continue reading Five signs that green is the next bubble

Five signs that green is the next bubble originally appeared on BloggingStocks on Wed, 07 Oct 2009 12:00:00 EST. Please see our terms for use of feeds.

Venture capital investment in clean technology grew 10% from the second quarter to the third this year. According to a report by the Cleantech Group and Deloitte, 134 companies received investments of $1.59 billion - up from $1.2 billion in the second quarter. The sector's upward trajectory continues, with last quarter marking the second in a row of double-digit growth. In the first quarter of 2009, venture capital investment in cleantech companies hit a low of $1 billion.

The strong third quarter has made the cleantech sector the largest in the venture capital business, according to the Cleantech Group, pulling ahead of biotech. Twenty-seven percent of venture capital funds invested in the second quarter of 2009 went to cleantech companies - up from 3% at the beginning of 2004.

Continue reading Cleantech VC funding up in Q3

Cleantech VC funding up in Q3 originally appeared on BloggingStocks on Fri, 02 Oct 2009 15:20:00 EST. Please see our terms for use of feeds.

Following his departure from Google (NASDAQ: GOOG) on Friday, Kai-fu Lee announced via Twitter that he was planning to launch a new venture fund. Today, he revealed the guts of a $115 million venture capital company that is focused on angel-round financing.

The company, Innovation Works, hopes to launch five successful start-ups a year in China. In addition to investing money in hot prospects, Innovation Works will act as an incubator for the businesses it backs. This approach doesn't exist yet in China.

Continue reading Cloud computing, mobile on the agenda for ex-Google executive

Cloud computing, mobile on the agenda for ex-Google executive originally appeared on BloggingStocks on Mon, 07 Sep 2009 14:00:00 EST. Please see our terms for use of feeds.

Private equity returns are down 27.6% year-over-year for the 12-month period ending July 30, 2009, according to a Preqin report received by BloggingStocks. The London-based research house notes, however, that the global private equity industry's dry powder (i.e., uncommitted assets) continues to exceed $1 trillion, suggesting that there is still plenty of capital waiting for a rainy day.

Returns for the past 12 months reflect all the nastiness we've seen and lived -- bailouts, company collapses, equity and credit market mayhem and unemployment rates dangerously close to double-digits. But, the money is still coming in. Preqin puts the rate by which contributions outpaced distributions at 235% for buyout funds in 2008. This category raised $148 billion while distributing only $63 billion, making last year the most imbalanced for these two measures in history.

Continue reading Private equity returns down, still plenty of cash on the sidelines

Private equity returns down, still plenty of cash on the sidelines originally appeared on BloggingStocks on Sun, 02 Aug 2009 11:30:00 EST. Please see our terms for use of feeds.

Venture capital funds found 612 companies in which to invest $3.67 billion in Q2. Of this, $1.5 billion (41%) was first-time financing, according to a report by PricewaterhouseCoopers and the National Venture Capital Association. This is only slightly ahead of the action in Q1, in which 141 transactions were first-time, and far behind the pace we enjoyed earlier this decade.

The biotech sector was the big winner in a shrinking market, with funding up 54% to $888 million over 85 deals. The software business was flat quarter-over-quarter at 4644 million over 135 transactions. Investments in internet companies fell 15% to $524 million via 124 deals. Clean technology showed considerable growth, up 15% to $274 million, with 42 transactions closed.

Continue reading VC first-time infusions hit 15-year low

VC first-time infusions hit 15-year low originally appeared on BloggingStocks on Tue, 21 Jul 2009 14:20:00 EST. Please see our terms for use of feeds.

Private equity investors are using current financial market constraints on liquidity to negotiate favorable deals, as private equity general partners have watched the values of their portfolios fall profoundly. Efforts to attract additional investment haven't been easy, as potential limited partners are reluctant to make long commitments in an uncertain marketplace. This has given limited partners a stronger position from which to negotiate both fees and terms and conditions.

Limited partners are getting a leg up on the private equity funds in which they invest, signaling a change from the historical trend in which funds could push for aggressive compensation based on the returns they provide. In a poll conducted by Preqin, 43% of investors noted a power shift from fund to limited partner, with only 2% seeing a shift toward the general partner.

Continue reading Limited partners putting pressure on private equity funds to cut fees

Limited partners putting pressure on private equity funds to cut fees originally appeared on BloggingStocks on Thu, 02 Jul 2009 17:15:00 EST. Please see our terms for use of feeds.

I had a chance to meet with Joanna Rees, who is not only a venture capitalist with VSP Capital but also the Chief Fonera of Fon USA. Oh, and she sits on the boards of companies like Posit Science, Sabrix, AccountNow, Danger, QuinStreet, The Threshold Group and NVCA.

No doubt, we had a lot to talk about - especially Fon, which is a peer-to-peer system to share WiFi services. Investors include biggies like Google (NASDAQ: GOOG), Skype, Index Ventures, Sequoia Capital, and so on.

And, this week, Fon received an additional $9.5 million in venture capital.

Basically, Fon has a unique business model. That is, if you allow free broadband access on your computer, you can get free access when you roam. Or, if you don't want free access, you can pay for it from fellow Foneros. So far, there are about 170,000 routers on the Fon system.

Continue reading Fon having fun with $9.5 million in funding

Fon having fun with $9.5 million in funding originally appeared on BloggingStocks on Tue, 15 Apr 2008 16:30:00 EST. Please see our terms for use of feeds.

Despite all this, venture capitalists continue to pour money into Web 2.0 deals. According to a report from Dow Jones VentureSource, there was about $1.34 billion in investments last year (across 178 transactions). In fact, this was an 88% spike over 2006.

Sounds good, huh?

Perhaps not. If anything, we may be seeing a weeding out of the weaker players and a bigger focus on the winners. After all, Facebook snagged about $300 million in funding. There was also a $44 million infusion for Ning as well as a $49.25 million deal for MyStrands.

Continue reading Is Web 2.0 fading away?

Is Web 2.0 fading away? originally appeared on BloggingStocks on Tue, 18 Mar 2008 16:25:00 EST. Please see our terms for use of feeds.

Often, startups will issue a stuffy press release when announcing their venture rounds. But in the case of Etsy - an online platform to buy and sell handmade goods - there is actually a detailed blog post from the co-founder Robert Kalin, which even includes a video.

In all, the company raised $27 million in a venture round. The investors include Union Square Ventures, Hubert Burda Media and Accel Partners. In fact, Accel Partners' Jim Breyer is taking a board seat (keep in mind that he invested in Facebook in the early stages).

Kalin goes into lots of detail on the "use of proceeds." Etsy is going to invest about $5 million in hardware and servers, and there will be big improvements in the payment processing system, which is on par with Amazon.com's (NASDAQ: AMZN). Oh, and the company wants to provide Google-like (NASDAQ: GOOG) search functionality.

Even without such things, Etsy is getting lots of traction. The community has more than 650,000 members and there are more than 120,000 sellers.

And as seen with its funding press release - which is one of the most transparent I've ever seen -- Etsy certainly takes the concept of "community" very seriously.

Tom Taulli is the author of various books, including The Complete M&A Handbook. He also operates DealProfiles.com.

Etsy crafts a $27 million venture deal originally appeared on BloggingStocks on Thu, 31 Jan 2008 08:45:00 EST. Please see our terms for use of feeds.

In light of the mega deals from Oracle (NASDAQ: ORCL), IBM (NYSE: IBM), and SAP (NYSE: SAP), the buzz is that business software is dead. How can small- and mid-sized players compete?

Well, I think there's still life in the sector. Take a look at the on-demand operators, such as Salesforce.com (NYSE: CRM) and NetSuite. They are disrupting existing markets - and growing at break-neck speeds.

We are also seeing some new-fangled Web 2.0 players enter the market. Take Huddle.net, which announced a venture capital round of $4 million (the investor is Eden Ventures).

Basically, the company realizes that the MySpace/Facebook generations want a different approach to software. As a result, Huddle.net has a cool system that allows for online workspaces, which even allow for social networking.

True, I know many think that this is a fad. Ironically enough, that's probably good news for Huddle.net. It allows the company to build out its offerings and learn form customer interactions.

In fact, for the past six months, Huddle.net has seen 25% growth in new users per month.

If you want to check out other cool venture capital deals, visit DealProfiles.com.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements.

Huddle.net raises $4 million: Ready to tackle the software giants? originally appeared on BloggingStocks on Tue, 13 Nov 2007 15:24:00 EST. Please see our terms for use of feeds.