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USA: Good-bye solar? Greentech investments shift to consumer tech and electric vehicles

The green technology investing boom has slowed. But if you ask investors, greentech isn’t disappearing, it’s just changing.

Between 2006 and 2007, cleantech and greentech emerged as hot terms in the investor vernacular. Startups focused on big-picture energy needs, including solar and wind power, pulled in huge investments, thanks in part to the rising price of oil. Government initiatives, along with venture capital, helped these companies grow quickly.

“Most of the investments were in energy production, focusing on increasing energy supply,” said Physic Ventures partner Andrew Williamson in an interview with VentureBeat. “These were capital-intensive investments in mostly solar, wind power, and biofuel commercial and industrial startups.”

But the demand for revolutionary energy technology startups has fizzled in the last few years. Solar production moved to China, and lower costs undermined United States manufacturing. The 2008 economic collapse hurt many industries, including greentech. After the famous Solyndra bankruptcy in Fall 2011, public opinion of solar and other large-scale energy technology slumped and new companies in the field have struggled to raise capital.

“The solar space as a whole is so depressed and troubled,” Pangaea Ventures partner Keith Gillard told VentureBeat.

Less solar, more consumer-focused tech
Since the 2008 recession, venture capital firms have refocused their funds away from solar and onto different areas of greentech. Physic Ventures has found success investing in consumer-focused green technology startups, as well as startups applying green principles to already viable technologies, such as cloud, mobile, and social


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