Venture capital investments in cleantech startups worldwide ended 2013 with 1,007 deals totaling $6.8 billion, a decline from the 1,037 deals amassing $7.9 billion the year before, according to market research firm the Cleantech Group on Wednesday.
Investors placed heavy bets on transportation, and that led to the whopping $258 million raised by Uber in San Francisco and $100 million by Xiaoju Technology. Uber offers an app for consumers to hail rides from drivers, including those from town car services, and its success has riled taxi trade groups and some regulators. Xiaoju is like Uber except it’s in China.
The decline in the overall venture capital investment dollars reflects the continual trend in which investors favor software and services instead of hardware technology that requires hefty money for lab research and manufacturing.The fall in solar cell material investment, in particular, highlights the lack of good returns by investors who poured in billions of dollars in the past decade.
Still, some of the recent big venture deals went to manufacturing tech startups. Fuel cell developer Bloom Energy in California raised $150 million last year. Nest, which makes sleek, programmable thermostats, announced an $80 million round in 2013. Texas-based Skyonic raised $128 million to build its first plant to turn carbon dioxide from power plants and other industrial operations into baking soda and other products.
Interest in Skyonic has come from oil and gas companies looking for ways to lower the amount of emissions they inject into the atmosphere. Skyonic’s investors include ConocoPhillips, BV Ventures and Cenovus Energy, an oil company in Canada.
Just yesterday, a California maker of smart windows, View, said it had raised $100 million to expand sales and manufacturing. Smart windows can be programmed to automatically adjust the amount of light they let in throughout the day to cool or warm up the room.
The emergence of the energy storage market — using batteries or other technologies to bank electricity for backup power or for managing the flow of solar and wind energy into the grid — also is attracting more investor interest these days. California is putting a program in place to require utilities to buy energy storage services. Companies such as SolarCity and Stem are marketing their battery equipment and software as ways to help businesses reduce their energy bills.
Just today, battery developer Aquion Energy in Pennsylvania said it has raised $55 million from investors including Bill Gates. Aquion plans to start to ship its batteries in the first half of this year.
Earlier this week, another battery company, Amprius, said it had closed a $30 million round. Amprius is targeting the consumer electronics market initially, though it aspires to develop battery packs for electric cars.