After I posted that last post about increasing VC interest in the clean technology sector, I started sniffing around and found this article on the San Jose Mercury News website on the rising interest in the green sector, or environmental technology. It shed a little cautionary light on the idea, noting that investments in the environmental technology sector have a history of big losses.
The reasons for the industry's poor performance are manifold: stiff regulation of energy and water, large upfront capital needs, an abundance of incumbent "dirty'' fossil-fuel producers and a lack of incentives to introduce new technologies. Many mainstream venture capital firms -- including Matrix and Greylock -- avoid the sector.
It notes though that history may not be a good indicator of the future, because the times they are a-changin'.
The need for efficient technology and clean water is exploding, along with the rise of living standards around the globe. And concerns about global warming are leading to pressure for environment-friendly regulations -- in California such moves will benefit solar, fuel cell and new nanotech-based material technologies, experts say.
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