26 February 2013

Is Cleantech a Dirty Word?

He used the "C" word.
"Is Cleantech a dirty word?"

I was asked this question over lunch today -- it's something that comes up regularly, like some disagreeable food.

Just a few months ago, when we began planning for our 5th annual Mid-Atlantic Cleantech Investment Forum, my friends and co-hosts at BlankRome's Venture Group announced that we were changing the name of the event to Mid-Atlantic Energy Technology Investment Forum

They even asked whether we were changing the name of our group, Cleantech Alliance Mid-Atlantic. My co-founder hedged and said we'd discuss it later.

Adam Lesser, writing over at Giga.om last month, asked, "Does the 'cleantech sector' need a new name?" 

"'Cleantech' is a dirty word right now in venture investing circles," Lesser posits. "And for me has never defined a sector as much as an idea—that we should leverage technology for the betterment of the earth." 

Over the past few years, we've had "clean energy" and "advanced energy"; once the favored term was "renewable energy" and even "alternative energy." And then there was the battle over "cleantech" or "greentech." And now there's even something called "cleanweb."

A year ago, Lesser's colleague at GigaOm, Katie Fehrenbacher asked whether it was time to bury the term.

Even as far back in September 2011, I wrote about Cleantech having a black eye and branding problem. (Longtime cleantech investor John Doerr referred to "Energy Tech," at an event I was covering.)

The question remains whether this is just a down cycle for cleantech.

Is the sky falling for cleantech, as I asked in a post last summer?

Or are we, as an investor friend of mine suggested six months ago, simply in Gartner's trough of disillusionment, shortly to be ascending the slope of enlightenment?

For now, I'm sticking with the "C" word. Get out the Lifebuoy!

21 February 2013

5th Annual Mid-Atlantic Energy Technology Investment Forum - April 17, 2013

Are you an investor looking for opportunities to invest in the energy technology revolution? Are you an entrepreneur with a killer app or energy platform that's looking for funding? Are you a service provider wanting to learn about the latest trends in energy tech investing from venture to corporate and seed to late-stage? 

If you answered yes to any of these questions, you won't want to miss our 5th Annual Mid-Atlantic Energy Technology Investment Forum (formerly known as the Mid-Atlantic Cleantech Investment Forum). This is the premiere energy technology investment forum in the region and always sells out fast. So register today

Wednesday, April 17, 2013 
3:30-4:00 p.m. Registration and Networking 
4:00-6:00 p.m. Program 
6:00-7:30 p.m. Cocktail Reception 

The Academy of Natural Sciences 
1900 Benjamin Franklin Pkwy 
Philadelphia PA 19103 

Ticket Pricing: 
$50 Early Bird (on or before 3/8) 
$65 (on or before 4/16) 
$75 (at the door) 
Ticket prices include all processing fees. 

Click here to register. 

Hosted by Blank Rome's Venture Group, along with my Cleantech Alliance Mid-Atlantic, and the Academy of Natural Sciences, the 5th Annual Mid-Atlantic Energy Technology Forum will feature a panel of experts and thought leaders discussing energy technology venture and corporate investing (moderated by yours truly), as well as a showcase of leading Mid-Atlantic energy technology companies. Topics and presenters to be announced. 

Energy Technology Companies: We are currently accepting applications for companies who wish to participate in the Energy Technology Forum Company Showcase. Click here to download the PDF application. Forward completed applications by March 1 to Nikki Benner at Benner@BlankRome.com. 

Want to sponsor the Mid-Atlantic Energy Technology Forum? We are currently seeking providers of capital, technology entrepreneurs, and policy makers to participate in this forum as sponsors. Please contact Nikki Benner at Benner@BlankRome.com for more information. 

You don't want to miss this very popular event -- register today

See you there! 

(Disclosure: The author is co-founder and a board member of the Cleantech Alliance Mid-Atlantic, which is co-host for this event.)

18 February 2013

Ten XL-sized Myths From Both Sides of Keystone Pipeline Debate

As some 35,000 opponents to the Keystone Pipeline gathered in front of the White House yesterday trying to persuade President Obama to just say no to the pipeline, I reflected upon some of the myths about the pipeline that have been bandied about by both sides on the issue.

Keystone XL protest in Washington.
(photo by Shadia Fayne Wood/Project Survival Media
via 350.org)
There are, as in most things, no absolutes in this debate. Digging deeper than the rhetoric and sloganeering, we find that both sides exaggerate the impacts of the Keystone Pipeline, the positives and the negatives.

Here are ten myths about the Keystone XL Pipeline (KXL), some of which I shared on the Payne Nation radio show a little over a year ago:

1.) Stopping KXL will help stop climate change - With the potential to transport an estimated 590,000 barrels a day, KXL certainly has a large carbon footprint. Yet, it is really only a drop in the barrel of global contributions to greenhouse gases. And if KXL is stopped, there is no guarantee there won't be alternatives to getting this oil to market; in fact, there are at least two proposed alternatives through western Canada being considered.

2.) KXL will create tens or hundreds of thousands or even millions of jobs - Jobs will be created, certainly, in the US, Canada, and probably elsewhere. But it is too difficult to substantiate the claims of either proponents or opponents, which range from one million to 200,000, and from 15,000 to "as few as 20" once construction is completed. Of curious note, according to one source, in TransCanada's 2008 original permit application, the pipeline developer claimed "a peak work force of approximately 3,500 to 4,200 construction personnel." Temporary construction jobs, that is, and probably "person-year" jobs (i.e. 1 person working full-time for one year.) 

3.) Tar sands oil is not worse for climate change - Proponents of KXL claim that tar sands oil only produce 6 percent more carbon than conventional crude oil, but other reports estimate the amount to be more than 20 percent. Whatever the amount, there is certainly going to be an increase, which could lead to health risks from emissions and potentially increase the costs associated with increased climate instability.

4.) America needs the tar sands oil - The oil from KXL was never intended for US markets. It will make its way to the Gulf Coast refineries, where it will likely be put on the more lucrative global market. TransCanada stated as much in a presentation to investors, suggesting greater profits for the company. Besides, with greater fuel efficiency standards, our need for oil may in fact be decreasing not increasing.

5.) The US should buy oil from a friendly neighbor like Canada rather than hostile countries - The US has steadily been reducing its dependence on oil from the Persian Gulf for years. In fact, according to data from the Energy Information Administration, Canada and Latin America already supply more oil than Saudi Arabia and other countries in the Middle East.  

6.) Tar sands oil will lower gas prices in the US - According to several studies, KXL oil will have little or no impact on overall US gas prices, which are set by a much more complicated set of global market factors.

7.) Tar sands oil will increase gas prices in the US - Again, KXL oil will have little or no impact on gas prices across the US, although according to a recent study, it could increase prices in the US Midwest by 10-20 cents per gallon, as the oil bypasses that market and heads south.

8.) Oil leaks from the existing pipeline have little impact on the environment - Proponents of the pipeline like to downplay the environmental impacts of oil leaks. However, the existing Keystone pipeline, to which the one under debate would be an extension leaked at least 12 times in 2011, including one spill in North Dakota that amounted to 21,000 gallons of oil, and a different tar sands pipeline spilled over 840,000 gallons of crude oil into the Kalamazoo River in Michigan in 2010. Such spills have an economic impact as well. The costs of the Kalamazoo River cleanup exceeded $650 million. 

9.) Tar sands oil will reduce US dependency on foreign oil - It depends upon how you define "foreign oil." Arguably, Canada is still not a part of the US and, even if some of this oil were to make it into the US market, in the scheme of things, it matters little where oil comes from in what is a complex, interdependent global market. And, if the tar sands oil will be refined in Port Arthur, TX, by a refinery half-owned by Saudi Aramco, as some suggest, where does the oil come from after all? 

10.) Building the KXL is inevitable - This argument has been made by proponents for years -- and even a few environmentalists. The latter suggest trying to stop KXL diverts attention from coming up with the full suite of solutions we'll need to wean ourselves from fossil fuels over the long haul, invest in alternative energy, and address climate change. 

I remain skeptical about the claims on both sides of the Keystone Pipeline, but I hope that the Obama administration will take a look at all the data and come to a reasonable decision about what to do, rather than give in to the side with the largest wallet or most strident voice.

14 February 2013

For Advanced Materials Like NanoSteel, Patience and Focus Are Virtues

"Could the humble sea urchin hold the key to carbon capture?"

I get a lot of press releases and articles. Most of them I ignore: a revolutionary high energy green food or lifestyle product, which I don't cover on The Green Skeptic.

But the other day, as I was preparing for the Greater Philadelphia Alliance for Capital and Technology/Cleantech Alliance Mid-Atlantic luncheon panel on advanced materials and nanotechnology, I came across one with this headline: "Could the humble sea urchin hold the key to carbon capture?"

An article on the subject by Dave Lewis also came in from my friends at The Energy Collective. Both were about some new research conducted by experts at the University of Newcastle in the UK. They’d recently published a paper, "Nickel nanoparticles catalyse reversible hydration of carbon dioxide for mineralization carbon capture and storage."

Why was it relevant to our discussion yesterday?

The researchers, Gaurav Bhaduri and Lidija Šiller, discovered that nickel nanoparticles catalyze the reaction that turns CO2 in water into carbonic acid.

Their discovery came after finding high concentrations of nickel ions on the surface of sea urchin larvae, suggesting to them that nickel plays a role in forming the sea urchin's exoskeleton.

"You bubble CO2 through the water in which you have nickel nanoparticles and you are trapping much more carbon than you would normally," Šiller told a reporter at the BBC, as quoted by Lewis. "And then you can easily turn it into calcium carbonate."

Calcium carbonate – we call it chalk – makes up around 4 percent of the Earth’s crust and acts as a carbon reservoir. Thus, it’s possible this research could lead to new ways to capture CO2 at its sources.

Admittedly, this is only research at this stage, still a long way from any practical applications, but as we heard from our panelists yesterday, this is how things work in the advanced materials space.

Breakthroughs in advance materials are happening every day. Whether catalysts and solvents improving energy generation and storage or membranes for better water filtration and air purification.

From materials fostering greater energy efficiency to nanomaterials used in the latest clean technologies, advanced materials provide solutions to make products more efficient, less expensive, safer, and even longer lasting.

In fact, advanced materials are all around us, and some are so ubiquitous as to be taken for granted: from superconducting materials in our computers and smartphones to LEDs for lighting; from lightweight bicycles to turbine blades, magnetic storage devices, and even shampoos.

Yesterday's panel provided a great opportunity to explore the world of advanced materials and nanotechnology with a group of investors and entrepreneurs in the space. Tucker Twitmyer of EnerTech Capital, Joseph King of DuPont Ventures, Mike DeSimone of DeSimone Group Investments, and David Paratore of NanoSteel.

NanoSteel logo
NanoSteel, as the name implies, is a leader in nano-structured steel material designs. Paratore, the president and CEO shared the story of how their relationship with automaker GM developed.

Through EnerTech, NanoSteel got a meeting with GM. The meeting didn't go well. It was clear they thought NanoSteel's technology was "cute," but not ready for them.

"If you can help us save weight in our automobiles by offering very high strength steel with high formability, come back and talk to us," GM said.

At the time, they couldn't. But NanoSteel now had a target and started to focus on it. As they did, they got closer and closer to realizing what the company was after and hence a relationship ensued.

Finding your focus is key, Paratore suggested, relentless focus on the commercial value of your enterprise. Without it, you risk being just an academic exercise.

That GM had a problem worth solving – and one that NanoSteel hadn't considered before – was a bit of serendipity.

Stories like that are not unfamiliar in the advanced materials space. Mike DeSimone told of how the iPhone got its glass.

"Gorilla Glass" was the brainchild of researchers at Corning in 1960, but it was an idea whose product had not yet come. It languished on the shelf for many years, until Steve Jobs was struggling with what became the iPhone.

Jobs wanted a glass that wasn't plastic, which scratched easily; something that thin, light, and damage-proof.

Corning had developed just such a glass in 1960 – then called "muscled glass" – but it was mothballed after Corning couldn't find enough commercial applications for the product.

Jobs learned about it and convinced Corning’s CEO Wendell Weeks to produce the glass for Apple's iPhone.

As of October 2012, according to Corning, Gorilla Glass has been used in over one billion mobile devices. Not bad for a mothballed advanced material.

Both Tucker Twitmyer and Joseph King warned that investors need to have a long time-horizon when they think about investing in advanced materials. Yet, they offered, the long-term "shelf life" of these products can make the companies producing them very attractive.

And it was clear from the two stories shared -- and other stories from companies such as OxiCool -- that there's a need for connectors. People who can be a part of the "seeking ecosystem" of a company – for either the one with the solution or the one with the problem.

My five takeaways about the advanced materials space (that are, frankly, applicable to other subsectors in cleantech) from yesterday's panel:

  1. Advanced materials are everywhere – in some cases we're talking about new materials and in others old materials with new properties used in a different way, a change in the core application. 
  2. Patience is required, both as an investor and as an entrepreneur: the time horizon is long, but so is the shelf-life. 
  3. Focus is key for entrepreneurs – relentless focus on commercial value, as Dave Paratore put it, but also remaining nimble enough to recognize and adapt to opportunities. 
  4. For service providers, there are opportunities to help companies in the space build relationships and partnerships, make introductions, to be part of the company's "seeking organization." 
  5. IP = value creation in advanced materials science.

(Disclosure: The author is co-founder and board member of the Cleantech Alliance Mid-Atlantic and sits on an Advisory Panel for The Energy Collective.)

06 February 2013

Want a Different Lens? Hire a Poet

Poets See Through a Different Lens
Roger Ehrenberg of IA Ventures posted on Twitter last night that his investment firm was looking for a new partner.

He linked to a blog post in which he wrote they wanted to get "some new perspectives in the Firm to help us look at opportunities through a different lens."

I thought immediately that Roger should hire a poet. Why?

"For one, poetry teaches us to wrestle with and simplify complexity," as John Coleman, co-author of Passion and Purpose: Stories from the Best and Brightest Young Business Leaders wrote in the Harvard Business Review blog last November.

Coleman observed, "Harman Industries founder Sidney Harman once told The New York Times, 'I used to tell my senior staff to get me poets as managers. Poets are our original systems thinkers. They look at our most complex environments and they reduce the complexity to something they begin to understand.'"

Second, poets are -- despite the seeming loneliness of their primary pursuit -- more sociable beings.

Coleman referred to a 2006 study conducted by the Poetry Foundation, claiming the "number one thematic benefit poetry users cited was 'understanding' -- of the world, the self, and others. They were even found to be more sociable than their non-poetry-using counterparts."

Further, poets and poetry readers may have more finely developed "qualitative and creative" skills and "creative judgment," which would enhance the more quantitative skill sets that IA Ventures already possesses among its partners.

Finally, as Coleman noted, referencing Clare Morgan's book What Poetry Brings to Business poets and poetry readers possessed "greater 'self-monitoring' strategies that enhanced the efficacy of their thinking processes.

"These creative capabilities can help executives keep their organizations entrepreneurial, draw imaginative solutions, and navigate disruptive environments where data alone are insufficient to make progress."

In an earlier HBR blog post, Tony Golsby-Smith, an Australian business design and transformation consultant, pointed to four key attributes humanities-focused people such as poets bring to any organization.

These include an ability to understand customer needs, an emphasis on creativity and innovation, communication and presentation skills, and analyzing complexity and ambiguity.

Such individuals tend "to be curious, to ask open-ended questions, see the big picture," Golsby-Smith wrote. "This kind of thinking is just what you need if you are facing a murky future or dealing with tricky, incipient problems."

For building relationships with customers (or Limited Partners, in the case of IA Ventures), Golsby-Smith offered, "you need keen powers of observation and psychology -- the stuff of poets and novelists."

So, to Roger I say, hire a poet for your new partner at IA Ventures. You will get someone with different, yet complementary attributes to those your Firm already has on board.

A poet will certainly be passionate, articulate, and interested in engaging in constructive debate as well as building partnerships with your portfolio companies. 

At least, I know one poet who fits that description.

05 February 2013

The Monsters Came to Poydras Street: Super Bowl Blackout Failure or Future?

In "The Monsters Are Due on Maple Street,"1960 Twilight Zone episode starring Claude Akin and Jack Weston, the residents of a typical suburban neighborhood lose their cool after a power failure is linked to a science fiction story about aliens posing as humans prior to a full-scale invasion.
United Planets Cruiser C-57D or Superdome?

The residents of the neighborhood are shown all chummy and cooperative and, well, neighborly, until something in the sky causes the lights to go out. Cars won't start and even the portable radios are silent. 

Someone first blames it on a meteor, but then one young boy offers an alternative suggestion. He recalls a science fiction story about a family of aliens sent to infiltrate a neighborhood much like theirs to prepare the way for a take over. The family looks just like a "typical human family: father, mother, and two kids," says the boy. 

Suspicion rules and paranoia escalates as neighbor turns on neighbor. A witch hunt ensues as first one and then another is accused of being the alien and on very little evidence. 

Someone gets killed, there's a riot, and mass hysteria breaks out. (I won't tell you how it ends; you should watch it on Netflix.) Suffice it to say, Maple Street is never the same.

Watching the episode last night, I couldn't help drawing parallels with the blackout during Sunday night's Super Bowl. 

The initially confused and perplexed faces of the players as they looked up to the ceiling of the Superdome in New Orleans as the lights started to go out giving way to anger expressed by the coaches as officials tried to explain the situation. 

Superdome or Alien Space Ship?
And then the blame game as Entergy tried to excuse itself, Peabody pinned it on reduced coal use, and stadium officials couldn't really shed any light on the situation.

I wondered what might happen if these types of events become a regular thing -- or when big weather events like Superstorm Sandy increasingly wreak havoc on our communities? 

How fragile are the bonds in neighborhoods in 2012 compared to 1960? (Admittedly, they were still in the midst of the Cold War and the McCarthy "red scare," but how will our modern, disconnected communities fare in the face of such crises?) 

As our electricity grid gets increasingly fragile and we grow more dependent upon our electronic devices, will we be able to keep our cool unlike the residents of Maple Street? 

Unless we make the necessary investments in our energy infrastructure to ensure that these types of events don't occur, we risk finding out the answer to that question. And we may not like the answer.