More creative business models needed

DUBLIN CLEANTECH FORUM REPORT:SEVERAL SEASONED cleantech investors made some compelling arguments at the recent Dublin Cleantech Forum organised by the capital's cleantech cluster, The Green Way and the Global Cleantech Cluster Association.

“At a private level, we probably need to come up with a brand new funding model and a more creative business model for clean technologies. But for now, often the best type of finance for early stage companies, if available, is a government loan or grant,” Cal Hackeman, head of global cleantech at advisers Grant Thornton International told the 300-strong audience.

“Entrepreneurs have to study the venture capital landscape while also thinking of themselves as global companies from day one in terms of their market and their supply chain. At my firm, we’re very conscious that getting to market could cost a multiple of 10 or more of any early stage financing,” said John Leggett, venture partner at Vantage Point Venture Partners, a US cleantech VC.

“If you start up now, you might be ready to go to market in 2015 or 2016. In a strategic context, ask yourself, what could happen in your sector by then and what wider factors or societal trends could influence it. VC firms are focused on picking a current trend that has a following wind. Success often comes the third time around for an entrepreneur, so start-ups should tap into some wisdom, he added.

Des Doyle, manager of Enterprise Ireland’s Growth Capital division, reminded early-stage businesses not to become too fascinated with their technologies and to focus on their business model, which is key to attracting investment.

Smart-grid technologies, energy efficiency and retrofitting, waste heat, electric heating, water infrastructure and efficiency, LED technology and biomass and anaerobic digestion are the key cleantech sectors that have the potential for growth in Ireland, the forum heard.

Two points were raised by speakers about offshore wind energy. “There’s plenty of room for innovation in the design of turbines and how manufacturing costs can be reduced,” Mr Leggett said.

“Offshore wind energy is at least twice the cost of onshore wind and, in Ireland, there’s probably a decade more of onshore wind development to come before offshore should be looked at,” said John McKiernan, of ESB-backed Irish cleantech VC Novus Modus.