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Digg“The liquidity event for an enterprise software company sucks,” said Jimmy Terybig, a venture partner with NEA. “But the multiple on energy can be huge.”
Those investing in early stage clean energy startups typically have few problems luring new investors in later rounds at a increased valuations.
“There are a lot of VCs who are looking to put clean technology in their portfolio,” said Krishna Srinivasan, a partner with Austin Ventures.
These kinds of generalizations don't exactly dispel the notion of a potential clean tech bubble. However, the panelists pointed to several specific areas that warrant investment not just because they are green, but because of a perceived demand for their underlying technologies.
Energy storage was cited by panel members as an especially promising investment area. Charley Dean, a principal with Silverton Partners, called it the “holy grail” of clean tech. He and Paul Thurk, a principal with Arch Venture Partners, also pointed to water purification technologies as an area ripe for investment.
Terybig conveyed the message that NEA was interested in big ideas with big market opportunities. Nothing new there, but he added that the management team wasn’t as important as the idea and even customer validation could be set aside if the idea was big enough. NEA does have $2.5 billion to invest, so the firm can put in a lot of capital and is willing to work with entrepreneurs with big idea, Treybig said. Many of the entrepreneurs at the Austin summit were eager to hear such a message from NEA. That said, they mobbed each of the panelists with equal fervor after the panel concluded. –Stacey Higginbotham
