Life can be hard for clean tech start-up companies struggling to move from a good idea to a competitive business model able to survive in the marketplace. At the Clean Tech Open 2011 Global Forum in San Jose on November 15-16, one such company selected from a pool of finalists from around the country will be awarded the Clean Tech Open US National Grand Prize consisting of investment and services valued at up to $250,000. Since 2006, the Clean Tech Open has raised more than $280M in private capital and estimates that it has created over 2,000 green jobs in the US. In addition to the prize money awarded, the program provides extensive training and support to its participants, including developing a business plan and training in how to make a pitch to investors.
I had the opportunity to attend the 2011 Northeast Regional Finals Event on October 4 at the Microsoft NERD Center in Cambridge, where regional semifinalists made pitches to a panel of judges and three regional finalists were selected to attend the Global Forum in San Jose. Lesser prizes were awarded to various runners-up. While the prize money was obviously important to these companies, the event was also a networking event and an opportunity for the entrepreneurs to show off their carefully prepared sales pitches to any private investors who might be in attendance. From their questions to the presenters, the judges were clearly interested not just in good ideas but also in companies whose business models would allow them to be profitable in the short- to medium-term.
The three companies that were selected to represent the Northeast in San Jose were:
- PK Clean, an MIT team that has developed a technology for turning waste plastic into oil that can be used as a fuel source. The company foresees two sources of revenue: one from being paid to dispose of the plastic and another from selling the oil that it produces. Even assuming that the disposal fee dries up and the price of oil falls well below the current level, CEO Priyanka Bakaya estimates that the company will still be profitable. PK Clean has a pilot plant in Pune, India and is currently seeking $4 million in investment to move into the U.S. market.
- Arctic Sand, another team from MIT that has developed a way to drastically reduce losses due to power conversion in the electronics industry. The company would initially license its technology to manufacturers of servers for large corporate data centers, where it estimates that its technology will save companies millions of dollars per year in electricity costs. In the future, the company plans to expand into the telecom and mobile sectors, where its energy efficiency technology could enable smaller and more efficient mobile devices.
- Qado Energy, a startup company that provides distribution grid analytic software to help with the completion of the interconnection studies that are necessary before new electricity suppliers can be connected to the grid. Especially for intermittent generators such as wind and solar, these interconnection studies are complex, expensive and time-consuming and can be a significant barrier to entry. The company sees a large market for its software platform as the smart grid takes shape and renewables begin to represent a greater proportion of the US energy mix.
I was impressed by the level of polish of the pitches I saw, and excited by the possibilities of some of these technologies. Despite recent concerns about competition from China in the renewable energy sector, the U.S. in general and the Boston area in particular are still very competitive when it comes to innovation. The Clean Tech Open encourages competition between entrants hoping to win the big prize, but it also provides support and publicity to help all participants bring their innovative ideas to market. The Northeast Regional finalists all have technologies and business models that promise to make significant environmental contributions while also being profitable, and the Clean Tech Open has helped them fine-tune their message to sell their ideas to investors. While we will be hoping for a win by one of our teams, it was clear to me that whoever wins the prize, all of the teams have benefited from their participation.