The Venture Financiers: Still Bullish on Energy?

 

Their numbers remain small, but investors in energy technology say California's energy crisis this summer may be a boon.

Energy venture capitalists at Nth Power Technologies spent three-and-a-half years, from 1993 to 1996, to raise the firm's first fund of $63 million. Fast-forward to Oct. 11, 2000, when the VC firm announced that after only nine months of effort it had raised $120.5 million for its second fund, more than doubling the size of the first.

"And the only reason it took us that long is that we purposely wanted to have global representation, so we went all over the world," says cofounder and managing director Nancy Floyd. The effort led to investments in Nth Power from interests from Canada to Europe to Japan.

Though both the number of players and the amount of cash coming in remains low relative to other VC investment sectors, interest in energy venture capital, particularly for power technology, seems to be increasing. It appears that for now, investors remain undeterred by the investment fears that have plagued other technology sectors such as the dot-coms, or even the industry restructuring question marks spawned by last summer's price spikes in San Diego.

A Small But Bullish Herd

Certainly, those venture capitalists that already have sunk money into energy technology will have you believe that the rush is on.