New Energy Markets Set for Long Term Boom

Two new articles piqued my interest today for their bullishness on cleantech, renewable energy, and alternative fuels.  In the first, Michael Butler of Cascadia Capital lends a macroscopic overview of the economic opportunity for new energy technology from an excerpt of an upcoming book Financing the Future and the Next Wave of 21st Century Innovation. Butler brings organization and a seasoned investor’s perspective to the cleantech sector – breaking down the separate needs and opportunities of the solar, wind, bio-energy, energy storage, clean water, energy efficiency, green building, and smart grid sub-sectors.

Private Equity HUB – Energy Markets Confront the Post-Petroleum Era

The Cost Of Cutting Emissions | BusinessWeek

Have you ever wished the whole world would just buy hybrid cars and be done with this global warming thing? It turns out that the price premium for hybrids also includes an enormous opportunity cost in regards to cutting emissions – far more effective alternatives exist that would also provide a much more enticing financial case as well.

Charts by Laurel Daunis-Allen

The March 10, 2008 edition of BusinessWeek included this clever graph depicting the range of emissions-cutting activities spanning the financial range from money-saving initiatives like updating residential lighting systems to money-chugging activities like hybridizing automobiles. While the magnitude of the bars indicates the net cost (or savings) of each initiative, the width suggests the relative quantity of greenhouse gases each activity could conserve.

This relative analysis points out, among other things, that improving automobile fuel economy standards is a much more cost-effective and emissions-effective means of reducing greenhouse gases than car hybridization. This data should be an essential reference for any company’s corporate social responsibility plan, and person’s own reference for greener living, and any government’s pursuit of effective business and environmental policy.

Greenopolis: social networking for the eco set

Social networking sites are carving out unique niches of special-interest groups and responding to the backlash against advertising that has slowed the use of Facebook and MySpace. Case in point: Greenopolis.com.

This beta-stage, lifestyle-oriented web community is designed for members to share tips on living greener and earn recognition for both participation in the web community and for greeer lifestyle choices. Minimal advertising is offset by corporate sponsorship from a somewhat surprising list of partners – you won’t find Patagonia, but you will find Waste Management for example.

An interesting concept employed by the site is is reward points – like frequent flier miles for social networking. The more you participate in the site, the more points you earn. Evidently, Greenopolis plans to connect these points to a commerce center where members can purchase eco-friendly products discounted by points. So the points aren’t redeemable for cash but they do generate real dollar value for site members.

An American Self-portrait | The art of Chris Jordan

Chris Jordan presents an evocative series of wall-sized prints that beautifully convey a tragic story. See more of this and other series at http://www.chrisjordan.com/

from www.frogdesign.com posted with vodpod

TED | Talks | William McDonough: The wisdom of designing Cradle to Cradle (video)

I live just across town from William McDonough, but this is as close as I’ve seen him. He’s the creator and advocate of Cradle to Cradle design – a design methodology which he describes in application to product design, material selection, and even urban planning in China.

from www.ted.com

Beyond Green

When a hotel executive asked me recently what I would do to communicate the hotel’s sustainability initiatives to current and future customers, I proposed that the hotel explicitly abandon trying to advertise and promote its actual green activities to focus more on the emotional goodwill of sustainability through story telling and interactive displays – allowing guests to touch and feel (with hands and heart) the ways the world could be a better place.

Innovation in Services: Miriam’s Kitchen

The value creators in our new economy are providing exceptional experiences by outperforming their niche in an industry network or tying together the nodes of the network and packaging the whole thing in innovative ways.

As part of my recent course at Darden on Innovation and Integration in Services – The New Economy, I made observations on a number of innovations as examples of value creation in this flat, networked world. This is my submission on Miriam’s Kitchen.

THE SERVICE

This organization falls strongest in the “Make Their Day” and “Be There” categories of the Fish! Philosophy. Miriam’s Kitchen, a provider of meals and additional services to homeless people in Foggy Bottom neighborhood of Washington, DC

HOW IS IT INNOVATIVE? WHY DID IT GRAB YOUR ATTENTION?

Miriam’s Kitchen is noteworthy for a number of characteristics. It has always used hot meals as a way to gather people who could benefit from the area’s social services and introduce those services in a non-threatening manner. In that sense, the dining room aggregates a target audience and makes additional, highly valuable services know. Second, Miriam’s Kitchen attracted a great New York chef to run the soup kitchen. His culinary smarts have helped form food partnerships with local distributors and restaurants

Sustainable development: mixed progress report

Originally published May 25, 2006.

A few recent news items have triaged the current status of sustainable design in architecture and urban development.  In Atlanta, a model of new urbanism and smart growth has emerged in Atlantic Station, where urban lofts, high profile office space, hotel rooms, restaurants and retail have combined to fill a 138-acre plot reclaimed from an old steel mill (see property map image below).

Atlantic Station is tops on the list of the nation’s bold mixed-use/New Urbanism developments, many of which were previously featured in the Business Week article, Bringing Community to the City (also check out the slide show associated with the article).

While the model is exciting for its pedestrian scale, access to public transportation, and inclusive development, the New York Times (Building a City WIthin the City of Atlanta, photo below Tami Chappell for New York Times) suggests the paint is so fresh as to make the place sterile and national retailers dominate storefronts while boutique or local retailers have not yet built a noteable presence, making it awkward to create an image distinct from that of a transplanted suburb.  The sustainable part may be right, but it’s not yet clear if the design works.  (Atlantic Station is roughly only half complete at this point, and several more years of development lie ahead for the ambitious $2 billion project.)

As Atlantic Station is discovering, architects and designers are struggling to identify the place of sustainability in architectural design.  Sustainability and Design seem to be playmates on a teeter-totter – linked together, but often facing trade-offs that raise one element over the other.  In the case of architectural design, interest (and commercial demand) pushes toward architecture as high art, elevating Design above Sustainability.  As students and professors of architecture put it in this New Tork Times article – Architects are a Lagging Indicator for Sustainable Design – the architectural profession is not yet widely geared toward producing practitioners skilled in Sustainable Design – though emerging standards for clean building technology and LEED certifications seem to be effectively demonstrating shifts in demand.

On a hopeful (albeit smaller scale) note,  The Culver House in Chicago is a new glass-facade condo project emerging as a beautiful model of advanced, sustainable building materials and high design, finding a nexus of eco-building and Modernist design.  (see the BusinessWeek article: Condo Development, image reproduced below.)

My hat goes off to the pioneers developing Atlantic Station and other bold mixed-use developments across the country.  I hope you are successful in revolutionizing the way we live, the way we interact with our built environment, and the way we preserve and steward the built environment for future generations.

VC for alternative energy

Originally published May 17, 2006.

Venture capital investors seem to have one major, common point of reference – the dot come bust of 2000-2001.  That bust followed a record year of VC fundraising – some $106 billion in 2000 among top benchmark firms – and preceded a major fallout of invested dollars across the economy.  The lessons learned all seem to point to greater discipline in VC investments, but that’s not holding back (re-)growth in VC fundraising.  The Associated Press reported in April that venture capital firms had raised some $6 billion in the first quarter of this year, more than 20% over last year’s figure for the same quarter, with projected annual fundraising around $30 billion.  (See the article as published in the Washington Post online: Venture Capital Fundraising Rises in 1Q.pdf.) [Update: The New YorkTimes ran an article suggesting that the renewed vigor in venture capital is not a sign of a new bubble: A Few Signs of Froth Do Not a Bubble Make]

The trends of last year indicated strong venture capital interest in “clean tech” and alternative energy as solar and wind technologies matured and new ventures generated profitable cash flows, buyouts, and IPOs.  In fact, three of the top IPOs of 2005 were solar power companies, as reported by the Wharton Private Equity Review.  [Update: See BW interview with Bill Joy, co-founder of Sun Microsystems and current partner at venture capital firm KPCB: Green: The Next Big Thing.  He thinks greentech is going to provide the next Google in terms of revolutionary wealth-creation.)

Now, the energy market is showing no signs of decreased demand despite continually high gas prices.  As Americans (and others around the world) effectively say “no” to conservation (see James Ellis’ op-ed piece in BW, No Sacrifices, Please), energy demand will continue to grow while limited stocks of fossil fuels (not to mention the political delicacies surrounding the international energy market) keeps a ceiling on supply.  With the proven returns in solar and wind power, and wide interest and policy incentives in ethanol, biomass, and energy storage technologies, the stage could be set for continued successful investment in clean tech industries.

And hopefully in two years the stage will be set to hire this Darden MBA into a successful and growing VC clean tech fund.

Innovation: buzz word or the real deal?

Originally published April 7, 2006.

From the glossy ads of IBM’s new Innovation business area to the whack jobs on American Inventor, it seems like everyone wants to be an innovator (or wants to hire one).  The emergence of Chief Innovation Officers and business school courses targeting innovation suggest that, in today’s tight market for large cap companies and healthy growth for small and mid-caps, innovation may be today’s killer app.  To my mind, this makes sense conceptually: as markets mature, the potential to exploit market openings diminishes and the need to create revolutionary new products, processes, and especially business models becomes a necessity.

In social entrepreneurship, innovation is never an option.  There are rarely opportunities to exploit; rather, whole new paradigms must be introduced, supported, and grown  – often outside the realm of traditional business.  (See The Economist’s article The hidden wealth of the poor (Nov 2005) in PDF.)

Its encouraging to see innovators finding successes in the realms of social entrepreneurship, such as the Washington Area Housing Partnership in Washington, DC, which is “re-branding” affordable housing initiatives as not just social support programs but prudent community development programs for working citizens.  Check out their story in the Washington Post, A Regional Campaign for Affordable Housing.

This innovation is also being cultivated in the young and passionate minds of academia.  As I head to The Darden School of Business at the University of Virginia, I’m especially interested in the innovation occurring within the University’s Engineering and Architecture schools.  I recently learned of an outstanding initiative in affordable housing at The University of Virginia’s School of Architecture: the ecoMOD program to prototype ecological modular housing.  For a heart-warming insight into the ecoMOD program in Gulf Coast restoration efforts supported by Charlottesville’s most famous author (Mississippi native and UVA parent John Grisham), take a look at this Habitat for Humanity Press Release (PDF).

Further interesting information on ecoMOD and other innovative architectural systems can be found at the Charlottesville Community Design Center’s  exhibition showcase and the Rural Studio, part of the Auburn University School of Architecture program of studies.