Mid-August 2009 poll results

A Washington Post – ABC News poll from mid August included questions on how the President is handling energy policy. The results showed very strong support for energy efficiency as a way to fight climate change. The accompanying published article, however did not mention efficiency and instead talked about solar, wind, nuclear (including the NIMBY issue) and transportation.

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Mazda, one of the few manufacturers to stay out of the hybrid car craze, has announced they will raise over $1 billion for hybrid research by issuing 315.2 million shares of their stock. As someone who questions the practicality of hybrids, this news is rather disappointing to me personally. You might call me a “hybrid hater.”

But what about hydrogen, Mazda? Le sigh…

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In what is sure to go down as a deft marketing move to garner some publicity (and virtually nothing more), Bank of America and Tesla have teamed up and announced that the megabank will start financing purchases of the Tesla Roadster to make them “much more affordable.”

I call BS.

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He’s right… that kind of cost-benefit analysis doesn’t really work. If you’re going to put up tens of thousands of dollars for a wind system (or a solar energy system), you probably want to see a return on that investment in years, rather than in decades. I got so interested in the topic that I wrote a post about things you should consider before putting your money down on a renewable energy system at SUNfiltered. Wind energy systems have their own requirements, so here are a few of the things you’ll want to take into consideration.

Will wind energy work on my property?

As with any renewable resource, some areas are better than others for home wind energy. Some of the questions you’ll need answers for include

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The Guide is filled with lots of information and hundreds of links to sites where more info and funding applications can be found.

The Guide starts by explaining the American Recovery and Reinvestment Act of 2009 (ARRA) and how it breaks down. Contained within the Guide is info about Green Energy Initiatives (DOE), Tax Credits, Green Environmental Projects (EPA)  Green Transportation Initiatives (DOT), Green Building Initiatives and Green Jobs/Job Training. It provides a modest number of “tips” and information as to how to actually land stimulus money which will be helpful to many people outside the Beltway. One that stuck out to me was contained within the “How To Apply” section:

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How To Finance A Green Business by Leah Edwards is an excellent post that covers four potential sources of cash for green businesses: SBA loans, social-venture venture capital funds, Friends-and-Family financing and partnering with a nonprofit organization.

Recently, Leah also posted about Financing for Energy Efficiency Improvements. In that discussion she talked about how some private banks are starting to offer “green loans” for the financing of clean energy systems or energy efficiency improvements. These same banks may offer small business loans for green businesses. Community banks often favor green loans so after you read the post, if it seems like an option check with your community bank.

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A recent post discussed what the entrepreneur seeking funding should bring to an investor meeting. Answer: a deck that will take no more than 20-30 minutes to get through and cover the following points:

The ten slides that you need, in my experience, are:

1. Vision: What are you trying to do, and why are you doing it?

2. Market: What is the market you are addressing and the estimated value of this market over the next 5 to 10 years?

3. Team: Who are the key three to five executives (Vision, Operations, Tech, Sales, Marketing), and what are their specific qualifications in the target market?

4. Offering: What is your exact offering? If possible, present a three to five minute pre-recorded video demonstration.

5. Roadmap: Where are you in your offering release cycle and with respect to gaining traction?

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]]> http://ecopreneurist.com/2008/10/29/the-perfect-eco-pitch-to-investors/feed/ http://ecopreneurist.com/2008/09/06/raising-venture-capital-a-primer-for-ecopreneurs/ http://ecopreneurist.com/2008/09/06/raising-venture-capital-a-primer-for-ecopreneurs/#comments Sun, 07 Sep 2008 00:38:08 +0000 mcmilker http://ecopreneurist.com/2008/09/06/raising-venture-capital-a-primer-for-ecopreneurs/ Click here to view the full post.

I really enjoy How To Change The World,a practical blog for impractical people. Now tell me, doesn’t that ring a bell with all green entrepreneurs? Here’s an excerpt from a  recent post, actually a series of videos Guy has on The Art of Raising Venture Capital.

Good tips for ecopreneurs!

Related Posts:

How to Approach a Venture Capital Firm with Your Eco Business

Eco-Angels: Venture Capital For Socially Responsible Eco-Businesses

How to Pitch Your Green Business to a Venture Capital Firm or Other Investor

Ecopreneurist: How to Approach a Venture Capital Firm with a Cleantech Business Idea

The role of financing

Achieving significant impact from energy efficiency would require new investment on the order of tens of billions per year for technologies to reduce electricity use, but those making the investments will quickly recover their money in the form of lower energy bills. To accelerate the benefits of higher energy efficiency, a system is needed to put more capital into the hands of those who benefit from reduced energy use so that investments can be made rapidly to ramp up the replacement of inefficient energy-using products and systems. This capital simply needs to bridge the gap between the cost of the new equipment and the future utility bill savings that it will provide, so an efficient and effective loan vehicle meets this need.

One such program that is receiving strong support comes from proceeds of a bond that are lent to property owners to finance energy retrofits. Recipients then repay their loans over time via an assessment on their property tax bill. These bonds can be issued by municipal or county financing districts and the proceeds can be typically used to retrofit both commercial and residential properties. For maximum effectiveness, these bonds would be issued in combination with federal loan guarantees to dramatically accelerate the energy retrofitting of America’s building stock by making new capital easily available. Because the repayment is tied to the property itself, the loan stays with the building to better connect the recipient (building owner) to the efficiency measures.

Summary

Poll results indicate that Americans are very supportive (with very little opposition) of steps to improve energy efficiency. Implementing energy efficiency requires evaluation, project development engineering, implementation, new product development and manufacturing, plus ongoing measurement, and each of these provides a real opportunity to create new jobs. Energy efficiency is the least expensive energy resource and the lowest cost method to slow the effects of climate change. All cost-effective opportunities to save energy should be implemented. Because energy efficiency saves money in the form of lower utility bills, those making the investments will get their money back, but investment vehicles such as simple and easily-available loan programs are needed to provide up-front capital.

About Lime Energy

Lime Energy is a leading provider of integrated energy engineering, consulting and implementation solutions specializing in improving the energy efficiency of our clients’ facilities, reducing their operating costs and carbon emissions. We focus on two specific markets: the commercial and industrial market, including utilities, and the public sector market, working primarily with energy service companies (“ESCOs”). Our clients include commercial and industrial businesses, property owners and managers, utilities, and ESCOs serving U.S. government and educational institutions. We focus on deploying solutions to reduce the energy-related expenditures of our client’s facilities and the impact of their energy use on the environment, including energy efficient lighting upgrades, energy efficiency mechanical and electrical retrofit and upgrade services, water conservation, weatherization and renewable project development and implementation. We provide energy efficiency solutions across all of our clients’ facilities, ranging from high-rise office buildings to manufacturing plants, retail sites, mixed use complexes and large, government sites to small, local facilities. The company’s stock is traded on NASDAQ under the symbol LIME. Additional information is available at the company’s website at www.lime-energy.com or by calling 847-437-1666.

[image by f_shields a creative commons] ]]> http://ecopreneurist.com/2008/09/06/raising-venture-capital-a-primer-for-ecopreneurs/feed/ http://ecopreneurist.com/2008/07/26/how-to-get-an-investor-to-even-listen-to-your-business-idea/ http://ecopreneurist.com/2008/07/26/how-to-get-an-investor-to-even-listen-to-your-business-idea/#comments Sat, 26 Jul 2008 15:46:36 +0000 Leah Edwards http://ecopreneurist.com/2008/07/26/how-to-get-an-investor-to-even-listen-to-your-business-idea/ In past posts, we’ve covered how to write a business plan and even how to pitch a professional investor such as a venture capitalist. However, there is a missing step between those two activities, which an Ecopreneurist reader wrote in to ask about, and that is: How do you even get an investor to return your call (or email)?

Although this answer is an over-simplification, I’ll recommend to you: Personal Contact.

A few days ago, a venture capitalist told me that he, with the other three partners in his firm, look at 1100 companies a year. These people have a lot of other things to do as well, such as attending board meetings of portfolio companies, conducting detailed due diligence for the few firms they choose to seriously consider for investment, speaking on panels at conferences, etc.

If you send an email to someone who gets hundreds of emails a day, you really need to stand out. Ideally, your subject line would say, “Referral from X.”

Making it Personal

Keep in mind that investors in early-staged companies are investing in people. Before it is really up and running, a Company doesn’t have much value. Ideas are a dime a dozen.

The value is built by executing on a vision and creating a brand, a customer base, a strong team, revenue streams, etc. It is as important to be seen as a trustworthy, capable person as it is to have your business idea be judged as sound.

You’ll have a higher rate of responses from potential investors, if you make use of introductions.

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]]> http://ecopreneurist.com/2008/07/26/how-to-get-an-investor-to-even-listen-to-your-business-idea/feed/ http://ecopreneurist.com/2008/02/18/how-to-finance-a-green-business/ http://ecopreneurist.com/2008/02/18/how-to-finance-a-green-business/#comments Mon, 18 Feb 2008 18:18:18 +0000 Leah Edwards http://ecopreneurist.com/2008/02/18/how-to-finance-a-green-business/ We received an email last week from an inventor in upstate New York, who has designed a green product that she wants to bring to market, and she would like some ideas of how she can raise money to manufacture and market the product.

I am going to present several ideas, not all of which may be perfect for her situation, but which are generally options for ecoentrepreneurs. Please comment on this post if you have additional ideas or questions about financing a green startup.

This will be a relatively long post, so here is a summary of potential sources of cash for green businesses:

• SBA loans
• Social-venture venture capital funds
• Friends-and-Family financing
• Partnering with a nonprofit organization

Another option, which would not work for this inventor, would be to bootstrap a company, as I described in a previous post.

And another option that is off the table is licensing: This inventor looked into licensing the product to a larger company, which would put up the money for both production and marketing and would then pay the inventor a licensing fee, presumably based on the volume of sales. The downside of the arrangement would be a loss of control over the production and marketing, as well as the fact that the company who is willing to license the product would have the production done in China. Because the inventor lives in upstate New York, where there is significant unemployment, the inventor wants to find some way to raise the money to manufacture the product in a factory within her community.

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