If you are in the cleantech sector and had not previously heard about Lanzatech, you likely have now. The company raised a big, $55.8M round last week that has been widely applauded and covered. Students of the company had seen this coming for awhile. Lanzatech was the highest ranking company in the Asia Pacific region in our Cleantech 100 survey earning it “APAC Company of the Year” at our gala banquet last year. It was featured as part of GTM’s Trendspotting post on the Top 12 Greentech Startups to Watch in 2012. We’ve made Lanzatech our featured “Company of the Week” in i3 this week, but it may just turn out to be cleantech’s company of the year (and its only January!). Here are the top reasons that I think Lanzatech exemplifies a number of key themes happening in cleantech:
1.) Cross-Border Financings – I have previously written about Chinese and Korean investors taking large stakes in Western cleantech companies. Now we can add the Malaysians to that list. The round was led by the Malaysian Life Sciences Capital Fund and included participation from Malaysian state oil company, Petronas. With the US venture community…
On the same weekend that the Giants broke the 49ers hearts, Sunil Paul playfully added some insult to injury in the bicoastal rivalry by declaring, “New York has stepped up with an event [cleanweb hackathon] that is, dare I say, bigger than San Francisco.” And while, as a true bicoastal executive, I have no interest in stoking the cliché Silicon Valley v. Silicon Alley fire, we can safely say that New York represented this past weekend.
The New York cleanweb hackathon organizers, which included Sunil, Blake Burris of Dynamo Labs, Micah Kotch from NYC ACRE, Nicholas Eisenberger of Pure Energy Partners, Matt Solt of Civvic, and a number of others, put on a great show and took a big step forward in evangelizing the cleanweb movement. Judging by the turnout, the “cleanweb”, the increasingly popular term for applying IT solutions to global resource constraint problems, is a hit amongst the East Coast digerati (even meriting an appearance by NYC’s trendminting venture capitalist Fred Wilson, who had previously cast off cleantech as an entirely separate form of VC).
There were a number of awards presented at the end of the event to standout teams (check…
It’s that time of the year when pundits and prognosticators begin to opine about what will happen in 2012. Frankly, I don’t like this game. In mid-2001, I worked for a technology “futurist” firm and wrote a piece predicting that CD-R/W music players would continue to dominate in the year ahead. That was a couple months before the ipod came on the market and made me look like a fool. Not that I mind looking like a fool, but I think I’ve shied away from these declarations ever since.
However, I was inspired this week by Rob Day (@cleantechvc) to throw my hat back into the ring. Why? Because Rob actually went back and wrote a post critiquing the predictions he made from the previous year. I found this remarkable precisely because most analysts write these odes with zero accountability. As an investor, Rob actually has to bet on his predictions, so I enjoyed his self-critique. I promise to do the same – someone hold me to it!
So without further adieu, here are my top 5, slightly irreverent, predictions for cleantech internationally in the year ahead. Why international? Because I’ve spent most of the last 6 months outside…
Like many American Jews visiting Israel, I found religion today. It was not religion of the spiritual kind however, it was religion of the electric variety. Today, I stand amongst the converted. Converted to Better Place’s view of the world and the potential for the company to be a transformative force in the electric vehicle market.
I am a most unlikely convert. I don’t own a car, let alone an electric one, and I’m quite content to not own one. From a policy perspective, I would prefer to see governments focus on subsidizing better forms of public transportation before promoting more personal vehicle ownership. More pointedly, I’ve been known to utter skeptical thoughts out loud in front of journalists about the electric vehicle market. Apparently, last month I told a group of reporters that “electric vehicles are a bet that could turn out to be wrong”. The point that I was attempting to make was that I believe some of the adoption forecasts in the market were too aggressive. That nuance doesn’t make for a good headline.
Assuming that electric vehicles are indeed a bet though, there is no one with more chips on the…
I wrote a passionate piece last week about concerns raised by some in the Israeli startup world that the country’s venture investors had hit a bit of a fundraising drought. In this week’s pitch of the week, I’m going to focus on the key reason why this drought should be remedied – namely, that Israel has a whole lot of cutting edge entrepreneurs!
This week our spotlight is on TriDiNetworks, an Israeli-based company that presented as part of the dealflow showcase at our recent Amsterdam Forum. Founded in 2007, TriDiNetworks is working to simplify the deployment and maintenance of controls networks within the built environment. We have written extensively in the past about the efficiency opportunity within commercial buildings and there is no shortage of both global, incumbent players and well-financed startups diving into the market.
TriDiNetworks has a unique value proposition as an enabling technology. The company’s pointed focus is on reducing the setup time and costs associated with configuring sensor networks. The company does not compete with established equipment vendors, but rather works in partnership with these systems to facilitate more efficient roll-out. “Efficient” in the context of network deployments means simplifying the technical competency…
If you haven’t heard the news, as reported by Venture Capital Journal, the Israeli venture-capital sector has hit drought-like conditions with local funds raising a grand total of $0 in 2010. Zeev Holtzman, founder of Giza Venture Capital, recently sounded the alarm in a public letter to Benjamin Netanyahu declaring, “Israel’s venture capital and startup industry is heading for collapse… the industry, which is the economy’s growth engine, is liable to be irreversibly damaged.”
As a typical, neurotic American Jewish young man and strong supporter of Israel, these headlines gave me as much cause for concern as the recent, heightened debate over political borders. Trying to allay these fears, Silicon Alley Insider picking up on this story wrote:
“One reason is that Israeli startups have often been specialized in sectors like security, semiconductors and networking equipment, which can be capital-intensive and that many feel are “played out” for startups… there’s a bright light however: Israel seems to start to “get” the consumer internet. Facebook just bought a local startup for $70 million.”
The last line struck me as both a comical and sad testament to the mindset of today’s startup landscape. The Israeli startup world has prospered…
The ongoing auction to acquire Landis+Gyr may have been the worst kept secret of 2011 in the smart grid industry. Various players – from major equipment vendors such as General Electric to large private equity firms – were rumored to be in the running to purchase the company. The big reveal came last week when Japanese conglomerate Toshiba showed up to meet L+G at the altar.
While smart metering carries significant buzz in the utility industry, it has not electrified Wall Street (pun intended). Itron, the best example of a pure-play publicly traded metering company, trades at an enterprise value multiple of ~1.1x estimated 2011 revenues and ~7.7x 2011 estimated EBITDA. Certainly not a frothy valuation. For purposes of comparison, LinkedIn currently trades at an enterprise value to revenue multiple of 30x and an EBITDA multiple of 235x!
For all the quiet chatter of the L+G deal being bid up significantly, Toshiba ended up paying an enterprise value multiple of between 1.4-1.7x 2011 revenues and a 10x-12x multiple on 2011 EBITDA estimates. Note, these are ballpark estimates – there are plenty of Wall St. equity analysts who can add an extra decimal to these figures if…
I spent the past two days in Paris presenting and participating at the SWAN Water Forum, a conference specifically built around smart water innovation. The team from SWAN, led by TaKaDu’s Guy Horowitz, managed to bring together a critical mass of some of the most important investors, corporations, utilities, and venture-backed startups in the space. While the topic of smart water is beginning to get lip service at more general cleantech industry events, this was a great chance to trade thoughts with a group that is actively working to catalyze adoption.
I began my Tuesday talk by laying out what is becoming a familiar story for those in the water innovation sector. Water production and management is fast becoming a mission critical issue due to real shortages brought on by rising populations, the deterioration of aging water infrastructure and assets, the emergence of new contaminants into water supplies, and the increasingly important intersection of water and energy issues (nearly 5% of U.S. energy use can be attributed to moving water around). At the same time, tens of billions of dollars are spent on water equipment each and every year. It should be a simple equation
Big problem +…
Earlier this month I published an insight profile on OPower (link requires subscription), a company that has established an impressive, early lead in the market for helping utilities communicate energy usage data to consumers. In that piece, I tried to explain the nature of the company’s success:
“While most software and web services vendors in the home energy management space are touting pilots with hundreds, or at best thousands of homes, OPower is the only SaaS (Software-as-a-Service) solution that is credibly touching millions of consumers. The company has achieved this impressive momentum by following a time tested business adage – KISS (Keep It Simple Stupid). While other vendors were pursuing elaborate hardware and software solutions, OPower maintained a sharp focus on the customer billing experience – both offline and online. In doing so, it has carved out a powerful position as the market leading solution for customer engagement.”
This morning, Jesse Berst at Smart Grid News had a similar headline that says it all “How OPower is Crushing Its Competition”.
OPower, based out of Arlington, Virginia, has primarily asserted its dominance in the United States where it has racked up customer wins at the country’s largest utilities including…
We are less than two weeks away from this year’s annual Cleantech Group San Francisco Forum – March 14th through 16th – so it is timely that this week’s Pitch of the Week comes from the exciting crop of companies presenting at the Forum’s Entrepreneur Showcase.
Founded in 2007, Power Tagging, of Boulder, Colorado, is rare amongst smart grid startups in that it is actually focused on the grid. If that statement seems counter-intuitive or downright confusing, consider that the vast majority of venture capital dollars flowing into companies popularly labeled “smart grid” has been directed into vendors developing energy management solutions for consumers or those specifically focused on the communication aspects of advanced metering. While these applications are undoubtedly important, they are only pieces of what would constitute a truly smarter grid. Despite this wider opportunity, few startups have dared to tread deeper into the world of touching real electrons.
Power Tagging is amongst a small set of ventures – a list that includes Grid Sentry, GRIDiant, and Sentient Energy – that has not shied away from this challenge. The company develops patented digital tags that can be embedded in a variety of…
I demand an alternative.
In one corner, I see the Tea Party representing the righteous indignation of hard core conservatives eager to see an America built on God, Guns, and Gold and in the other, I see the Occupy Wall Street movement representing a cliche patchwork of feel good sounding liberal causes coupled with the support of increasingly counterproductive Unions.
I demand something for the rest of us.
America is a jetliner descending in a long, slow crash pattern and those of us who long for solutions based on pragmatic, intellectually rigorous solutions are lounging in the back of the plane while the far left and the far right wrestle for control of the yoke. I count myself amongst those seated too comfortably, yet not guiltlessly, in Business Class enjoying my fresh-squeezed orange juice while gazing out the window at our rapid descent.
You see, I’ve spent a good bit of the last six months out of the country, living for a time in Europe, traveling for business in Asia, and vacationing in Central America. All the while, I’ve watched the political process unfold in America with a growing sense of detachment and fatalism. For someone who has thought of himself as politically engaged, this has become an increasingly sad and frustrated feeling.
Our country is badly broken. No amount of rhetoric, Christian militia or peacenik marching, or cable news commentary is going to solve the intractable issues we face. We can’t cut around the edges and we can’t leave it to the “Rich” to bail us out. Our problems are not going to be solved by cranky, old, white men posing as Patriots or naïve, college youth imitating revolutionaries.
Our problems are only going to be solved by those with enough practical experience to know what real trade-offs we face and the courage to tell voters things that they might not want to hear. We need leaders who won’t pander to those who believe that either God or Government is here to save us. We need visionary thinking, but only from those with the backbone to execute on it.
We need solutions that respect human dignity and individual liberty while not bankrupting us to do so. We need an economic environment that promotes innovation of all kinds, that allows those creating disproportionate value to enjoy disproportionate gains, but that has clearly enforced rules of the game to protect the public good and the least fortunate.
In short, we need a movement of the middle. I’m tired of watching this World Wrestling Federation match happening up in the cockpit that is certain to send us spiraling into the ocean. I don’t want to take to the streets in protest nor blather away on Fox News or MSNBC. I want to do something to help find real solutions to real problems. Who’s with me?
The following organizations seem to be fighting this good fight (please let me know of others!)
No Labels: http://nolabels.org/
The Third Way: http://thirdway.org/
Michael Bloomberg: http://www.mikebloomberg.com/
I have been working with a client recently that frequently uses the question - “what is our right to win?” For example, when assessing strategic growth opportunities for their business, they evaluate standard drivers such as market size, growth rates, competition, and margin trends, and then thoughtfully, and with a refreshing level of self awareness for a major multinational company, turn the mirror on themselves to ask “regardless of how attractive this opportunity is, why should we able to win here?”
As I sit reflecting on my own professional decisions, I realize how important this question should be to assessing one’s career choices. Like many of my peers, I am plagued by a constant fear of choosing. In the past twelve years, I’ve been a management consultant, run business development for a software company serving non-profits/advocacy groups, spent a stint writing on technology commercialization at a major research institute, went back to graduate school, founded a web-based service in the advertising/entertainment space, and now help to run a venture-backed research firm on cleantech. On top of all of that, I harbor a deep desire to be a yoga instructor and own a coffee shop.
To say that I have become a jack of all trades, might be an understatement. I don’t regret any of the aforementioned opportunities that I have pursued, yet in retrospect it is clear to me that most of the analysis that led me down those paths was focused on dissecting the job and not me. Is this a big market opportunity? Would this be an interesting topic to learn? Is there a brand value to the firm/position? I even asked altruistic questions… What does this job/company contribute to the world? Is this work meaningful?
What I didn’t genuinely ask was “why am I uniquely positioned to succeed in this role?” Certainly, I could have answered that question with a proper amount of spin in each job interview, but what I didn’t do was really take stock of it myself. I think that I am just beginning to internalize how important this question is to aligning one’s passions and skills to one’s chosen profession. As I think about the roles that I will take over the next decade, I am more certain than ever that success, and equally as important, satisfaction, will rest in making sure that I take a good look in the mirror each and every time and have a solid, gut-check answer to the question of “Why me? What is my personal right to win here?”
This week was a classic, “whack-a-mole” week. One of those work weeks where there are a million and one things to do and that the faster you knock things off the list, the faster that new ones appear. In my old office I had hung a Mario Andretti quote, “if everything seems under control, you’re just not going fast enough”. I believe in it wholeheartedly. My only caveat would be that in the startup world where stasis is death, extreme levels of busyness can easily be mistaken for positive momentum.
I think that one of the real keys to success is to understand when this frantic pace is actually contributing to building a foundation for long-term success and when it is just busyness. If you get distracted by thinking, “I’m so damn busy, something good must be happening”, you risk whacking the wrong moles and spinning your wheels.
We’ve got an all-day management meeting this week that we do once a quarter to pull our heads-up out of the day to day. I’m sometimes guilty of rolling my eyes at these kinds of strategy sessions as I think they can distract from the “doing”, but this is one of those times that I am thankful to be working with a business partner/friend/CEO who has far more intuition than I do about when to focus at the 100,000 foot level and can force me to come out of the weeds.
You can’t build a successful company without whacking the moles, but it pays to plan a bit about which moles to whack.
Could not agree more with Nader’s observation that “As powerful as Google is, it’s still a one-trick pony. Investors beware…”
Warren Buffet famously describes his favorite businesses as “economic castles protected by unbreachable ‘moats.’” The Apple ecosystem is a good example of this. Apple makes money a few different ways, but its primarily from hardware. While other manufacturers might make a faster tablet, or…
Even by my liberal standards of coffice etiquette, this crosses the line. A full desktop setup including full size keyboard in The Grove this morning. I feel particularly sensitive around this as a couple of years ago, I saw a similarly over-the-top setup carted into Snice, one of the world’s greatest spots to hang out and do work in New York City. A week later, they had shut off wifi and clamped down on laptop use, so I saw that desktop stunt as the straw that broke the camel’s back for the store owners that had grown tired of squatters. Demonstrates that we should be kinder to our cofficemates and more respectful of our landlords!
In an effort to jumpstart some more personal blogging, I thought I would try a weekly “curious things” post that highlights some random news and notes that I come across during the week that stimulate the “I should blog about that” reaction, but that I never seem to muster enough energy on for a real post. We’ll see how long I can keep this up!
BRIC nations are abstainers on Libyan no-fly resolution - I found it interesting that the world’s fast growing, BRIC countries - Brazil, India, China, and Russia - were the only nations (plus Germany) that abstained from supporting the UN’s Libya no-fly resolution. Perhaps this should be a signal that costly foreign interventions are the anchor that continues to drag down Western economies intent on maintaining an antiquated position as global police force while high-growth BRIC countries prefer to remain on the sidelines.
DFJ Esprit nets 5X venture return (or 15% IRR) - Rarely do you see a venture capital firm put out a press release touting a return on an investment, but DFJ Esprit did just that this week. It cited a 5x return on its investment in call center software company TLC. While 5x sounds like a homerun, consider that they first made this investment in 2000. 11 years to exit means that a 5x return equates to a 15% IRR. 15% annual return is by no means shabby, but it doesn’t have quite the ring as 5x! Just goes to show how the venture world sometimes plays fuzzy math to make itself seem far more impressive.
Inside Job - I went to see the Oscar-winning documentary Inside Job last night. I had already read The Big Short (a must read), so the idea that the 2008 mortgage meltdown was the result of disgustingly greedy, deceitful, ponzi-like behavior came as no surprise. What continues to surprise me is that absolutely nothing changes in the face of increasing income inequality and the clearly documented, widespread fraudulent behavior that many in the finance world have used to achieve this extraordinary wealth.
There is no reason for anyone with any chops online to be remotely involved with Facebook, except to peruse it for lost relatives. So, next time you log on, remember it’s really AOL with a different layout… Welcome to the past.
-John Dvorak, PC Mag: http://www.pcmag.com/article2/0,2817,2375715,00.asp
Got to say that I’m beginning to agree with him. Over a fairly computerless holiday time and first week of the year (thanks to my laptop crashing), I did a bunch of thinking about how I spend my online time, what was bringing me true professional and personal value, and I just couldn’t really see the value I was getting from Fbook relative to the time I spent sharing, commenting, and posting. There are other online forums that seem to offer far more tangible value and I’m going to be spending more time there.
I believe that Fbook has created an incredibly powerful form of entertainment, people love and need entertainment and I certainly don’t begrudge anyone some mindless relaxation. It’s a personal reality TV show 24 hours a day and since even I like an episode of Jersey Show now and then, I appreciate the power of this form of entertainment. If Vinnie, Paul, and The Situation are making millions then Fbook is certainly worth billions. That said, for me, Fbook is a reality genre that has gotten boring for me and so I’m going to turn the channel. I may channel surf back from time to time for reruns, but I’m no longer a regular audience.
(Yes, I realize the irony that this post will appear on Fbook since my Tumblr account is linked there)
It is not often that Kleiner Perkins is able to participate in a $100M+ deal in the cleantech sector without sending the cleantech media and blogosphere into a virtual frenzy. But that is exactly what happened last week.
On January 5th, Kleiner and TCV announced a $135M investment into OSIsoft, a leading developer of data management solutions for industrial energy efficiency applications. While I spotted the news in PEHub, I couldn’t find a single mention of the deal in my usual cleantech news sources.
I gave it 24 hours. Nothing. It is a week later now and still no mention. Silver Spring signs a partnership deal with Control 4 and everyone falls over themselves to get the story out, but Kleiner buys a significant stake in a highly profitable company with over 10,000 customer installations and it’s like a tree falling in the forest with no one to hear it.
Even more remarkable is that OSIsoft should be a poster child for the cleantech venture sector’s current theme of 2011 – capital efficiency. OSIsoft is a software business that specializes in aggregating data from disparate systems in industrial environments. The company is no startup venture. It was founded in 1980 and now employees over 500 people.
While the company doesn’t comment publicly on revenue and profitability, a 2008 corporate presentation cites $160M+ in revenue. For a business built organically that continues to invest significantly in R&D, it is a safe assumption that it is producing plenty of cash.
And where there is an established business with healthy cash flow and the potential to ratchet up the growth curve, private equity money will come knocking. While OPower may have boldly proclaimed that they didn’t really need Kleiner’s money, OSIsoft truly didn’t. This is not a venture deal and OSIsoft VP of Marketing Jon Peterson confirmed for me that the investment was primarily providing liquidity to existing shareholders and not direct investment back into the business.
The existing shareholders deserve liquidity as they have built an incredibly successful business that is poised for growth as the company begins to position itself as a leading provider of smart grid and broader energy efficiency applications. They already serve many of the world’s leading power producers and industrial manufacturers and provide a data aggregation solution that may emerge as an important development platform for third party application developers looking to build analytics and optimization packages.
I believe that this deal is an important signal of things to come. As our work for the Department of Energy on the Smart Grid Ecosystem pointed out, the majority of vendors providing solutions into the smart grid market are not startups. They are companies that have been around for quite awhile. While they may not be based in a trendy loft space, they are likely producing significant revenue from legacy product lines. With the venture model under pressure in the cleantech sector, I predict we will start to see more interesting deal activity from private equity players seeking out opportunities with established vendors.
It may not set the blogosphere abuzz, but it makes for good business.
(cross posted from http://blog.cleantech.com)
I know that this headline is riveting and that perhaps only one, incredibly wonky political friend of mine will read beyond that title (if that is you, please like this link as proof you are a nerd).
The census is serious stuff. It happens once a decade and it drives the assignment of Congressional seats and political boundaries. State results are out and as today’s Politico headline announced, “2010 census results show power shifting westward”.
As of April 2010, the official date of the census, the five fastest growing states were all in the West: Arizona, Idaho, Nevada, Texas and Utah. As many political commentators have pointed out, this would seem to benefit Republicans as these states gain Congressional seats.
With my new post-partisan hat on however, this is not going to be argument about Republicans v. Democrats. This is going to be an argument that the data driving the census is quite likely entirely wrong already and we’re not even a year into the decade governed by this dataset.
As of April 2010, these “fastest growing states” were also, in parallel ranked amongst the top states for home foreclosures (in order of misery - #1: Nevada, #4: Arizona, #5: Idaho, and #8: Utah). Recent data suggests Texas has now cracked the top 10 as well.
While it is noble that people packing up their belongings and filling a moving truck took an extra 10 minutes to fill out the census, this act of civic responsibility has likely totally skewed the data that will drive assignment of political seats. It wasn’t enough that we had to bring down our economy with the mortgage fiasco, we had to screw up the census too!
It’s holiday time and that means year-end giving campaigns from your favorite charities and political organizations. It’s a noisy time to make an appeal and economic times are tough (tax deductibles donations are not as helpful when you’ve got less income to deduct!) but all that aside, this one is quite personal.
Last week, I joined the Board of Advisors of Darfur Stoves. If you’re in search of an organization to support this time of year, I’d encourage you to read more of the Darfur Stoves story.
For all of us tech-centric folk who think technology really has the power to change the world, Darfur Stoves is putting theory into practice.
There are two keys reason that I joined this organization and why I’d encourage you to take a look!
#1: I believe that those of us developing and promoting technology in the first world, particularly in my current field of cleantech, have an absolute obligation to find ways to transfer these technologies to the developing world. Darfur Stoves was founded via the pioneering work of Ashok Gadgil at Lawrence Berkeley National Lab. In addition to a variety of work on energy problems in the first world, Ashok has been one of the leading thinkers in the world today on adapting technologies to the realities of developing world conditions and markets.
#2: One of the first lessons I learned in building startups was that you bet on people not ideas. Darfur Stoves is a wonderful idea and a wonderful technology, but organizations like this are built on great people. Andree Sosler, Darfur Stove’s Executive Director is not only a good friend, but she’s one of the smartest, most fiercely committed people that I’ve met operating in the non-profit world. Andree and I met at Wharton where she took two years out of her life not in pursuit of personal profit, but rather in search of for-profit frameworks that would help her back in the developing world. While most of our Wharton classmates headed up to Wall Street, Andree went straight from Philadelphia to Rwanda to consult on development issues.
If you’ve set aside some savings to give to people out in the world using technology to fight the good fight, please consider supporting Darfur Stoves.
Flecktones at the Fox Theater in Oakland last night
When they broke into Big Country, I felt instantly transported to a very good time of life circa 1998.
Some things never change…
- Victor Wooten still turns the electric bass into an inhumanly textured instrument that leaves you shaking your head in wonder
- Future Man and his drumitar have come no closer to returning to planet Earth
- Bela, sitting by himself, on five string acoustic banjo is still simply transcendent.
Some things do change…
- Nader, one of my best friends in the world for the past fifteen years, was still sitting there next to me at the Fox (that probably should be filed under the best thing that hadn’t changed). Our hair is much shorter now though and he is a proud father.
- Pandolfi wasn’t there sitting in awe and plotting his course to play as fast as Bela, he is somewhere out on tour with a couple of hit albums proving that he can do it.
Thanks Flecktones for taking me on a ride in the time machine!
I spent the first week of December in Seoul. It was my first trip to Korea and I left inspired by the city, its energy, and its spirit. The country has emerged as a global innovation powerhouse and I was glad to have the chance to get a glimpse into what made it tick.
As someone incredibly curious about the conditions (social, political, and economic) that catalyze entrepreneurial cultures, I was consistently struck by the parallels between Seoul and Tel Aviv - another city that punches way above its weight class in terms of spawning innovation. A couple of striking similarities:
Geographic Adversity: Korea has been sandwiched between China and Japan and has, throughout history, been a theater of conflict between these two historical powers. Seoul now sits precariously close to North Korean missles. Korea has little in the way of natural resources and must import nearly all of its energy sources. Israel’s geographic adversity needs no explanation. This adversity has become a source of…
Defiance & Courage: Both cultures stand proudly defiant and courageous in the face of this geographic adversity and outright hostility. I flew into Seoul a day after North Korea had announced that it couldn’t ensure the safety of passenger planes flying near its airspace. Tensions were, and remain, very high on the peninsula, yet everyone I met seemed entirely dismissive of the threat and eager to criticize international media for painting the situation as far more dangerous that it was. Israelis display the identical attitude towards threats of terrorism and potential missile attacks. It feels heretical in Tel Aviv to display any sense of fear. I think that this drive to succeed in the face of external threats is an incredibly powerful cultural force for entrepreneurs in both countries.
Export Driven: Both small nations (Israel far smaller than Korea) are developing world class technology, but must look abroad for large markets as domestic sales are inherently limited. The Koreans that I met seemed particularly impressed by the Israelis ability to penetrate U.S. and Western markets and remarked that they needed to do a better job in this area. In a world increasingly built on cross-border opportunities, both Korea and Israel are at an advantage in that export driven thinking has been a necessity and is now second nature.
Hustle: It would be cliche and stereotypical to say that both cultures value education - they do, but I think that it is more than smarts separating the entrepreneurs in these countries. I think that it is the combination of intelligence and hustle that is the real spark. Israelis can be short and aggressive, but I think outsiders mistake this as an unfriendly, rather than a driving desire to get sh*t done. The Koreans that I met were perhaps more socially tactful and gregarious than my Israeli friends, but were similarly disposed toward real actionable opportunities.
Side Dishes: I’m not yet certain how it drives entrepreneurship, but dining in both cities features elaborate spreads of side dishes and sharing a meal feels a central part of cementing relationships.
Perhaps it is something in the kimchi and hummus, but I truly love both these cities and hope to spend more time in both.
I remember like it was yesterday grabbing breakfast with Jack and Nat at the old Bucks County Coffee shop on Locust (which seems to now be defunct and renamed Saxbys). PlaceVine had just won the Wharton Venture Award along with the companies that these guys were starting and I was eager to hear what they were up to - the Wharton undergrads were 1000x more credible as entrepreneurs than anyone in the MBA program.
It is easy to say in retrospect, but it didn’t take longer than 5 minutes sitting with them to recognize that whatever these guys did, through sheer force of will and intellect, was going to be successful (as the WSJ article mentions, they really didn’t know what they were going to do at that point!). They carried themselves more articulately than guys twice their age, they there were the real deal (not to mention incredibly nice guys).
Jack/Nat - you guys are rockstars and couldn’t be more deserving!
So when I look at where we are right now, it reminds me so much of 1999 and frankly it scares me
http://www.avc.com/a_vc/2010/11/pacing-yourself.html
Not a quote you want to see from one of the most savvy early stage investors around
(cross posted from http://blog.cleantech.com)
It is becoming a common refrain across many cleantech sectors to lament the slow speed of technology adoption by large, enterprise customers. Companies developing new hardware and software for the smart grid must contend with the buying cycles of large, regulated utilities. Those targeting innovation in the water sector face an uphill battle to get installed in facilities owned by municipalities. Even those building next generation energy efficiency products for buildings or industrial facilities must tackle traditional, commercial procurement processes. Sales cycles are long, pilots can last for months if not years, and decision-making can be by multiple committees.
Having experience as an operating experience in both the telecom equipment and enterprise software world, I can readily sympathize with the pain. I try to discuss the nature of this slow adoption cycle as much as I can with cleantech entrepreneurs and look for parallels from other industries. Ben Horowitz, a successful entrepreneur and now an active venture capitalist in the software and internet services world, had an insightful piece last week, via TechCrunch, on the nature of enterprise sales that is directly applicable to the cleantech sector as well. Ben writes of three major hurdles:
Perhaps most presciently Ben writes, “the order of adoption now follows decision-making speed rather than deep pockets.”
All of these lessons are valuable for cleantech firms looking to break into large utilities, enterprise customers, and municipalities. There are reasons – both good and bad, rationale and irrational – for the slow speed of technology adoption by large customers. The art of achieving momentum may not be about cracking the code of the industry’s top 5 accounts, but rather finding the path of least resistance.
One of my favorite case studies of succeeding by eliminating sales friction is OPower. If measured by real adoption, the company is arguably been the most successful startup in the home energy management space and has become so by heeding many of Ben’s lessons from above. They developed a billing analytics product that (a) integrated well with existing utility models and (b) involved little to no risk on the part of utility decision makers – no one was going to lose his/her job for installing the service. They proceeded to successfully sell into a variety of mid-size utilities following the speed of decision making rather than the deepest pockets. With significant momentum, they are now finding themselves well positioned to win business from the largest utilities in the world and are rumored to be PG&E’s recent selection for a large, home energy management deployment.
The very nature of the sectors that most clean technology hopes to transform - energy, water, waste, transportation, etc. – makes selling to large, enterprise customers inescapable. With limited capital and runway, early stage companies would be wise to heed Ben’s advice, study OPower, and learn quickly how to find the cracks in the enterprise walls.
I wake up far too early many weekend mornings - sleeping in for me usually means around 6:30am - and try to use the time to catch-up on news/feed reading that I’ve missed during the week. My weekday mornings are usually spent focused on making sure I’m up on the daily cleantech industry news, but my weekend is when I catch up on my fill of larger technology venture world, politics, etc.
When you can take the time to broaden your lens, so many interesting patterns begin to emerge. I’ve been spending a great deal of time thinking about potential models for providing valuable industry data in the cleantech space and when I poke my head up to look at how companies are tackling this challenge in retail or financial services, I can learn so much.
The anxiety comes from opening my feed reader and seeing hundreds of unopened items, information that I couldn’t possibly, humanly consume. Yet, for me, all of these unopened items are potential missed opportunities. I know that we’re lost in a world of information overload that can be both paralyzing, yet empowering and it is this conflict that I am constantly trying to reconcile.
I’m reading Marc Lesser’s “Less: Accomplishing More By Doing Less” and it has some very insightful observations on focus in our modern world. Marc is a Buddhist monk turned MBA-entrepreneur and it is one of the first books in this genre that I haven’t written off as entirely cliche. He presents a balanced perspective that sympathizes with a type-A striving desire to consume as much information as possible with some strategies for ensuring that you are actually mindfully processing that data.
I still haven’t found the right balance and I still stare at those unopened stories with a sense of not having enough time and a sense that I am missing something, but I am certainly trying to find a way to most effectively monitor, synthesize, and react to what is out there. Anyone with suggestions, technology tools, organizational methods, etc. - please feel free to send them along!
15 stories in 6 days… I’m not sure we are even visible in China’s rearview mirror right now.
It’s [Silicon Valley] a culture of risk-taking…Entrepreneurship is so embedded here. It’s what everyone talks about. If you don’t participate, you’re on the outside. When I did a counseling event at my son’s school, every single junior in his high school class knew what a venture capitalist was.
I spent this past week in Los Angeles for a conference that we (Cleantech Group) produced on innovation in the water sector. As part of my moderating duties on the opening night of the conference, I had to give a quick introduction for a speaker focusing on the convergence of water and IT. I searched my brain for a quick personal anecdote to use in making the introduction and Po Bronson jumped into my head.
Po Bronson’s book, “What Should I Do With My life?” is a great read for those of us with career wanderlust. Bronson spends time categorizing people based on how they approach careers and specifically refers to one group as “Boom Wranglers” - those who seem to be involved in whatever the latest “boom” area of innovation happens to be. As Bronson writes…
“Boom Wranglers were only one species in the wide-ranging genus that might best be described as “Those Who Change a Lot”. This grouping doesn’t include the many who are forced to change by layoffs, or by having to move. It’s people who choose to jump around. Maybe a need to stay in motion isn’t a problem - maybe it’s the solution. Constant reinvention. Why not? Changing careers is a modern form of wandering. It’s how we expose ourselves to more of the world without ditching our responsibilities or draining our savings.”
In describing the convergence of cleantech and information technology, I exposed myself as a “Boom Wrangler” who had managed to begin my Silicon Valley career in data networking, move to software, then web services, and now to cleantech. A path that now seems entirely logical thanks to the coming boom in datacomm and software opportunities in cleantech.
I guess the moral of the story is that sometimes life’s wandering turns from random into entirely rationale and that staying in perpetual motion is not necessarily a bad thing.
Voting in America is so entirely backward. I’m not talking about the people (though that may be the case after today as well)… I’m talking about the process. We are, for now, still the world’s most technologically advanced place on the planet and yet when I go to a polling place, I am handed 5 huge, cardboard-like ballots. I am instructed to connect arrows with a felt pen and then I feed these ballots into what looks like a garbage bin (the picture above is what I attempted to feed my ballot into this morning).
The bin inevitably jams sending poll workers scrambling for how to open the monstrosity with the only key to it dangling around the neck of woman who sounded as if she was simply stating robotic messages… “error, we must now use the auxiliary bin, error we must now use the auxiliary bin.”
This is no way for us to participate in what for me is perhaps the most important day of the year. Today I voted for a ballot prop in the city of San Francisco that would extend voting to Saturdays and would allow day-of-registration. We are doing lots of good things to enable more people to vote. The least we could do is give them a simple, straightforward, 21st century way to register their opinion.