Small Business Startup News
Despite Struggles, Clean Tech Startups Are Still Receiving Innovation Dollars
Written by Tim Morral
Clean Energy Trust poised to give away $1 million for new ideas while VCs struggle to convert clean energy investments into profitable companies.
On the surface, the clean energy sector sounds like a promising place for startups. The reality is more complicated, with many clean tech startups burning through investment capital and struggling to identify marketable products. However, that isn't stopping a number of organizations from awarding serious funding to highly innovative clean energy entrepreneurs.
Funding and Supporting Clean Energy Startups
Recently, the Clean Energy Trust opened applications for the 5th annual Clean Energy Challenge. With an application deadline of Jan. 13, the Clean Energy Challenge is a single-day pitch event that will award more than $1 million in investment awards--double the amount that was awarded in last year's challenge.
"The Clean Energy Challenge has helped us transform the Midwest into a focal point for the clean energy industry by fostering entrepreneurship, innovation and job creation among these startups," Amy Francetic, CEO of Clean Energy Trust told Chicago Inno. "The program gives clean tech startups the opportunity to secure essential startup funding and exposure to some of the industry's leaders on a national stage."
In addition to the Clean Energy Trust, other organizations around the nation are working toward stimulating innovation in clean energy. For example, in October, New York University (NYU) announced the launch of a certificate program to train business professionals in clean energy principles. According to FierceEnergy, the Clean Start program is supported by the New York State Energy Research and Development Authority (NYSERDA), and will provide entrepreneurs with a foundation for launching clean energy startups.
Clean Energy Challenges
But despite ongoing attention from funding organizations, the clean energy sector's track record with VCs is sketchy. Bloomberg recently reported that clean energy has been a difficult VC funding target in recent years. After a wave of optimism inspired by government initiatives, high profile companies like Solyndra tanked, even though VCs had collectively poured more than $1 billion into the company.
Ultimately, the issue may be that venture capital investors and clean energy entrepreneurs have different goals. While both want to see clean energy companies become profitable and grow, clean tech entrepreneurs are often working on a longer time horizon than VCs--underscoring the need for startup owners in this industry to make sure that their growth goals are aligned with the expectations of potential investors.
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