Cleantech venture capital investment in 2007 jumps 43 per cent to $3bn

The US accounted for 83 per cent of global cleantech investment in 2007. With $2.52bn invested in 159 cleantech deals, the US saw an impressive 79 per cent increase in investment over 2006. Cleantech accounted for more than eight per cent of the total US venture capital investment in 2007.

'With record-high fuel prices, ongoing debate over carbon emissions, and the potential for favourable legislation following this fall's election, investors recognise that the time is ripe for innovation and investment in this area,' said Jessica Canning, director of global research for Dow Jones VentureSource. 'The energy industry is so massive that any slice of it can produce substantial returns to the investor, regardless of if they are targeting the consumer or enterprise. And there is currently no single clean technology leader, so there is significant opportunity to gain from being the first to market. Combine those forces with the attention consumers are giving to products and services that comply with energy efficient standards, and you have a market with huge potential.'

The largest US cleantech deal of 2007 was Palo Alto, California-based Project Better Place, which raised $200m in its first round of funding to develop a market-based transportation infrastructure for electric vehicles.

In Europe, where the Nordic region, Spain, Germany and others have long been on the forefront of cleantech implementation, cleantech investment also reached a new record in 2007 as venture capitalists invested approximately $360m in 56 deals. This marks a 27 per cent increase in capital investment over 2006, despite deal flow being virtually unchanged from the previous year.

China, which experienced record cleantech investment totalling $424m in 2006, only saw six deals completed and $129m invested in 2007, accounting for just four per cent of global cleantech investment.

The median deal size for a cleantech company in the US stands at $8m, up from $7.5m in 2006, while for European cleantech companies the median deal size rose to $3.3m in 2007 from $2.3m in 2006. The median round size for a cleantech deal in China in 2007 was $11.8m, down from $15m in 2006.

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