Venture Capital and Cleantech: The Wrong Model for Clean Energy Innovation An MIT Energy Initiative Working Paper July 2016 Dr. Benjamin Gaddy1 Dr. Varun Sivaram2 Dr. Francis O’Sullivan3 1 Director of Technology Development, Clean Energy Trust;
[email protected] 2 Douglas Dillon Fellow, Council on Foreign Relations;
[email protected] 3 Director of Research and Analysis, MIT Energy Initiative; Senior Lecturer, MIT Sloan School of Management;
[email protected] MIT Energy Initiative, 77 Massachusetts Ave., Cambridge, MA 02139, USA MITEI-WP-2016-06 Table of Contents Introduction .................................................................................................................................... 2 Silicon Valley Meets Cleantech ................................................................................................... 3 A Losing Combination: High Risk and Low Returns ............................................................ 5 Box: How We Classified and Evaluated Start-up Companies .............................................. 6 What Went Wrong?....................................................................................................................... 8 Beyond the VC Model for Cleantech ....................................................................................... 11 Appendix: Full Methodology ..................................................................................................... 13 References ....................................................................................................................................