Cleantech Venture Investment in 2013 Tops $6.8 Billion

Google Buys Nest

By Neil Thomson

January 16, 2014

Global cleantech turned a corner in 2013 after several years of decreasing investment, and 2014 is off to a strong start with Google paying $3.2 billion to bolster it’s home energy management offering.

Global Market intelligence firm, Cleantech Group reports that worldwide venture investment across all clean technology sectors totaled $6.8 billion during 2013. This is 15% lower than  the 2012 total of $7.9 billion, however, on a quarterly basis investment rose throughout 2013 at a rate of 14.5% compounded quarterly. This signals a positive shift in the market after five consecutive quarters of decreasing investment that began in early 2012. Sheeraz Haji, CEO of Cleantech Group says, “Investors continue to shift away from capital intensive deals and move towards distributed generation, resource sharing, agriculture, and the digital oilfield theme”.

In 2013 the energy efficiency sector led the way by both total dollars invested and deal volume with $1.3 billion invested and 20% of the sector total. The transportation sector finished second at $1.2 billion and the solar sector third at $719 million. “Other top sectors in terms of deal volume and value invested included: Biofuels & Biochemicals with 66 deals, accounting for $584 million; Recycling & Waste with $371 million across 52 deals; Advanced Materials with $299 million across 83 deals; Agriculture with $266 million across 55 deals; and Water with $190 million across 69 deals.”

The number one region for cleantech investment in 2013 was North America with $1 billion invested across 131 deals and the considerable majority in the United States. These strong numbers are good news for the sector following a recent report by 60 minutes suggesting that ‘cleantech’ may have become a dirty word. Enter Google with a jaw dropping $3.2 billion cash purchase of Nest Labs, owned by two former product designers from Apple. The Nest learning thermostat and smoke detector are reinventions of long forgotten household devices. Both are smarter and prettier than their predecessors and achieve considerable energy savings in the process.

Andy Baynes, Director of Business Development at Nest Labs will be presenting at the Partnerships for Canada’s Clean Economy 2014 conference on January 30, where we look forward to hearing first hand about the landmark deal with Google.