Some very, very large check-writers have been getting bigger and more interested in private equity investments. Sovereign wealth funds and large pension funds don’t get a lot of attention, but they’re huge players in the investment world. And as I’ve been speaking with several members of that community, two points have come through fairly clearly: 1) many (especially those outside the U.S.) are interested in doing direct investments in the cleantech space, broadly defined; and 2) they feel stymied in trying to do so.
They are interested in investing in cleantech markets for the same reason you are, Gentle Reader: because the macro trends are too obvious on a global scale to not eventually result in massive market shifts and the emergence of significant new profit pools.
But when it comes to cleantech venture investments, they’re largely sitting on the sidelines. Why?
First, check size. Talking with these investors, even in their direct investments, they need to write really large checks compared to what most VCs are used to. A $50M check can be perceived as too small of a bet to bother with. And so that significantly limits the universe of types of “venture” deals they can invest in.