Clean tech raises $7.8B in VC funding in 2010

Stats for the year show smaller amounts per deal, but record-high number of deals

2010 was a good year for clean tech, which saw a jump in venture-backed investments totaling $7.8 billion across 715 deals.  The totals mark a 28% increase over venture-backed investments in 2009, which totaled $6.1 billion across 624 deals.  But 2010’s clean tech financing still falls short of 2008’s $8.8 billion. 

The data, presented Friday by the Cleantech Group, was gathered across North America, China, Europe, and India.  North America accounted for the largest portion of the financing, representing 68% of the total amount with $5.28 billion invested across 391 deals, followed by Europe and Israel with 21% and Asia with 10%.  The amount of VC funding raised in North America in 2010 was a fairly sizable increase over 2009, which saw $3.65 billion raised among 317 deals.

California—unsurprisingly—accounted for most of the funding, electric car infrastructure company Better Place representing the largest deal at $350 million in a Series B round led by HSBC, with input from Morgan Stanley Investment Management, Lazard Asset Management, Israel Corp., VantagePoint Venture Partners, Ofer Hi-Tech Holdings, Morgan Stanley Principal Investments, and Maniv Energy Capital. 

The solar sector saw the most funding in 2010 with $1.83 billion or 24% of the total, followed by transportation with 175 ($1.35 billion) and energy efficiency with 14% ($1.05 billion).  Solar has taken the lead in clean tech investments for the last several years, but in 2008 it accounted for a whopping 40% of clean tech investments.

So who was doing the investing in 2010?  Chrysalix Energy Venture and Draper Fisher Jurvetson were tied with 16 deals each, with Carbon Trust Investment Partners, Kleiner Perkins Caufield & Byers, and Element Partners each accounting for 12 deals.  By comparison, in 2009, Kleiner Perkins was the top investor in clean tech, with 19 deals that year, and in 2008, Khosla Ventures led clean tech funding with 21 deals.

While 2010 didn’t raise the same amount of funds as 2008, it nevertheless set the record for the highest number of deals (2009 had the second highest number of deals, despite raising less money than in 2008).

Last year also saw a record in IPOs, with 93 companies raising $16.3 billion, with China accounting for 68% of IPOs completed and 61% of total funds raised.  But the largest IPO was that of Enel Green Power, the renewable energy unit of Italian utility Enel, which raised $3.6 billion on the Madrid Stock Exchange.

2010 also saw 716 M&A transactions totaling $36 billion.