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Insight into innovation

Insight into innovation

Cleantech Investment and Innovation Trends

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Insight into innovation

• Welcome

• Housekeeping, Q/A and Materials

• Brief Introduction to Foley and Cleantech Group

• Presentation

• Intro of i3

• Q&A

Briefing Agenda

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Jim ChapmanPrivate Equity & Venture Capital PartnerFoley & Lardner

David ChengResearch & AdvisoryDirectorCleantech Group

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Insight into innovation

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2. Please submit your questions at any time during the presentation using the chat window, we’ll answer as many as we can at the end.

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Recording and Q/A

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Insight into innovation

• With nearly 1,000 attorneys in 21 offices, Foley provides award-winning business and legal insight to clients across the country and around the world.

• We draw on the legal knowledge and hands-on industry experience of attorneys in more than 60 practice areas, including Green Energy Technologies, to provide the full spectrum of legal services — any of which can be tailored to meet your unique challenges.

• Our exceptional client service, value, and innovative technology are continually recognized by our clients and the legal industry.

– In a recent survey of Fortune 1000 corporate counsel, conducted by The BTI Consulting Group, Foley received a top 10 ranking out of more than 500 firms for our strong client focus, breadth of service, innovation, and value for the dollar.

• At Foley, we strive to create legal strategies that help you meet your needs today — and anticipate your challenges tomorrow. ww.foley.com

About Foley & Lardner LLP

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Insight into innovationAbout Cleantech Group

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Insight into innovation

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market intelligence solution providing insight into:

• The most important companies in the cleantech sector

• The latest technology trends

• The financial transactions and relationships shaping the sector’s competitive landscape. 

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Insight into innovation

Between the patent filings and venture investments, a few trends have emerged:

• Markets with large Total Addressable Markets (TAMs) still have multiple niche areas for growth, particularly for Solar and Wind

• Energy Efficiency is not an easily patentable sector. This trait also tracks with software as well, which is the comparable sector VCs compare to Energy Efficiency.

• After US, Japan and Germany leading in corporate innovation, but lagging in venture investments. Canada and UK lead in VC, after US.

• Don’t discount the impact of Corporates on cleantech innovation. Corporates remain active in investments and patent filings.

Patents and VC Trends

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cleantech.com

Insight into innovationModest Decline after a Strong 1Q11

• $1.83 billion of venture capital investment across 161 deals• Top deals: Fisker, Suniva, Bridgelux, Enerkem, KiOR.

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Insight into innovationCanada, China and UK Strong in 2Q11

Top 5 Non-US Deals:• Enerkem (Canada): $60m• Enecsys (UK): $41m• Avantium (Netherlands): $36m• Royal Tech Solar (China): $36m• JeCh Technology (China): $31m

Top 5 Non-US Deals:• Enerkem (Canada): $60m• Enecsys (UK): $41m• Avantium (Netherlands): $36m• Royal Tech Solar (China): $36m• JeCh Technology (China): $31m

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Insight into innovation

• Continuing trend of large late-round deals in cleantech VC investment

• Global venture investment declined from a record-setting 1Q11: $1.83 billion of capital invested across 161 deals, down from $2.75 billion/174 deals in 1Q11

• Average deal size = $14.4 million; disparity between early vs. late rounds still exists– Seed/First round avg = $6.0 million– Series B+ round avg = $18.5 million

• Only one $100m+ deal in 2Q11 (Fisker Automotive), compared to seven last quarter

Cleantech VC Investment Highlights

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cleantech.com

Insight into innovationTop 10 Venture Deals in 2Q11

Company Sector Amount Total Paid In

Capital Country TopInvestors in the Round

Fisker Automotive Transportation $100,000,000 $440,000,000 United States (undisclosed)

Suniva Solar $94,400,000 $224,400,000 United StatesWarburg Pincus

New Enterprise Associates

Bridgelux Energy Efficiency $80,000,000 $203,150,000 United StatesVantagePointCapital Partners

Chrysalix Energy Venture Capital

EnerkemBiofuels &

Biomaterials$60,000,000 $118,578,885 Canada

Rho VenturesBraemar Energy Ventures

KiORBiofuels &

Biomaterials$55,000,000 $166,469,000 United States Khosla Ventures

General Compression

Energy Storage $54,500,000 $80,200,000 United States Northwater Capital Management

iControl Networks Energy Efficiency $50,000,000 $93,500,000 United StatesKleiner Perkins Caufield & Byers

Intel Capital

BioAmberBiofuels &

Biomaterials$45,000,000 $45,000,000 United States

Mitsui & Co. Global InvestmentSofinnova Partners

Enecsys Solar $41,290,000 $56,072,496 United KingdomGood EnergiesNES Partners

Avantium Materials $36,341,277 $58,841,277 NetherlandsSofinnova Partners

Capricorn Venture Partners NV

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Insight into innovationEE & Solar Leading the League

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cleantech.com

Insight into innovationTop 10 Solar Deals 2Q11

Company Sub-sector Amount Total Paid In

Capital Country Top Investors in the Round

Suniva Crystalline Si cell $94,400,000 $224,400,000 United StatesWarburg Pincus

New Enterprise Associates

Enecsys Micro-inverters $41,290,000 $56,072,496 United KingdomGood EnergiesNES Partners

Royal Tech Solar Tracking equipment $35,725,003 $35,725,003 China Tripod Capital

Agile Energy Asset Acquisition $24,000,000 $37,200,000 United States Good Energies

Fonroche PV modules $21,651,000 $87,751,000 France EURAZEO

Semprius Concentrated PV $20,000,000 $39,300,000 United StatesSiemens Venture Capital

In-Q-Tel

SolarReserveConcentrated solar

thermal$20,000,000 $160,000,000 United States

Good EnergiesCredit Suisse

SolarBridge Technologies

Micro-inverters $19,000,000 $34,000,000 United StatesRho Ventures

Battery Ventures

Morgan Solar Concentrated PV $16,500,000 $26,200,000 CanadaThe Frost Group

Iberdrola Renovables

GreenVolts Concentrated PV $16,300,000 $88,000,000 United States Oak Investment Partners

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Insight into innovation

• VC activity in solar sector used to be focused on traditional PV cells & modules value chain, but we have seen some variety in 2Q11:– Micro-inverters: Enecsys, SolarBridge Technologies– Installation service: SunRun, WorldWater & Solar Technologies,

Solar Capital– Concentrated solar technology: SolarReserve, Morgan Solar

• Other innovations include:– Tigo Energy: web-based application for maximizing PV output– SkyBuilt Power: solar-based mobile power stations– Barefoot Power: solar power application on consumer goods

• Traditional PV value chain is still getting deal flow, including the largest solar deal in 2Q11, Suniva

More Variety in Solar Industry

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Insight into innovation

• Support from top investors: Several investors appeared in many of the top 10 deals within the two most popular sectors in 2Q11:

– Solar: Good Energies (3 rounds)

– Energy Efficiency: KPCB (3 rounds), Intel Capital (3 rounds), Khosla (2 rounds)

• The focus of solar industry is shifting as cells/modules market matures, the frontier is now at the systems end, such as micro-inverters and tracking equipments

– Technology-centric, while less capital-intensive

– New business models: more local in focus (rather than manufacture in Asia)

• Energy efficiency was boosted by a blossom of energy management companies and lighting companies

– Energy management: end-user specific technologies: home, commercial buildings, data centers, etc.

– Lighting: more venture rounds in smart lighting control start-ups

Key Success Factors for Top Deals

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Insight into innovationIPO Number Very Close to 1Q11

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cleantech.com

Insight into innovationM&A Number Slightly Declines after Strong 1Q11

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Insight into innovationTop Corporates in M&A

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Corporate# of

AcquisitionsTargets

Sectors Involved

Schneider Electric 5

TelventBeijing Leader & Harvest

LuminousDigiLink

Lee Technologies

Smart GridEnergy Efficiency

Veolia ES Solid Waste

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JC SanitationParker Sanitation

Suburban Disposal & RecyclingTreesmith

Recycling & Waste

General Electric 2Calnetix Power Solutions

FMC-TechSmart Grid

ABB 2Mincom

Validus DC SystemsSmart Grid

Energy Efficiency

cleantech.com

Insight into innovationTop Corporates in Venture Investments

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Corporate # of Rounds Companies Sectors Involved

General Electric * 11

Scientific ConservationOn-Ramp Wireless

VPhaseNuventixEmber

GMZ EnergyHara

Project FROGViridity Energy

WiTricitySunRun

Smart GridEnergy Efficiency

Solar

Mitsui 4

BioAmberProterra

Marrone Bio InnovationsRedwood Systems

Biofuels & BiomaterialsTransportation

AgricultureEnergy Efficiency

Intel 3iControl Networks

Scientific ConservationJouleX

Energy Efficiency

Gamesa 2SkyBuilt Power

WorldWater & Solar TechnologiesSolar

cleantech.com

Insight into innovationOverview of Total Claims

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cleantech.com

Insight into innovation

Representing areas of strong interest and investment, the top five innovation categories in which the most patent claims were granted were:

•Photovoltaic solar cell construction and/or materials, with 2,843 claims; remains in the first place category from 2009 and 2008.

•Control systems for hybrid vehicles, with 827 claims; remains in the second place category from 2009.

•Wind turbine generator operational control, with 740 claims; up from the fifth place category in 2009.

•Mounting systems for solar panels, with 579 claims; was not in the top five in 2008 or 2009.

•Wave-driven hydro power generation, with 538 claims; was not in the top five in 2008 or 2009.

Overall Patent Activity Top 5 Technologies

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cleantech.com

Insight into innovationWho Holds the Patents

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Owner2010

Number

2010 Percen

t

2009 Numbe

r

2009 Percen

t

2008 Numbe

r

2008 Percen

t

Corporate entity 965 82.7 672 81.7 458 77.8

Individual inventor(s) 202 17.3 151 18.3 131 22.2

Corporate Entities Versus Individual Inventors

The overall breakdown between individual inventors and assignees (typically a corporate entity) for all cleantech categories is as follows:

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Insight into innovationWho Holds the Patents

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cleantech.com

Insight into innovationWho Holds the Patents

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Country2010

Number2010

Percent2009

Number2009

Percent

United States 673 57.7 478 58.1

Japan 145 12.4 111 13.5

Germany 114 10.0 81 9.8

South Korea 43 3.7 35 4.3

Taiwan 26 2.2 18 2.2

Canada 20 1.7 14 1.7

Great Britain 13 1.1 12 1.5

Denmark 28 2.4 10 1.2

France 20 1.7 9 1.1

China 13 1.1 4 < 1.0

The Top 10 breakdown of 2009 and 2010 patent ownership countries for all cleantech categories is as follows:

cleantech.com

Insight into innovationSolar Patent Activity Top 5 Technologies

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cleantech.com

Insight into innovationSolar Patentable White Space Top 3 Technologies

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cleantech.com

Insight into innovation

Between the patent filings and venture investments, a few trends have emerged:

• Markets with large Total Addressable Markets (TAMs) still have multiple niche areas for growth, particularly for Solar and Wind

• Energy Efficiency is not an easily patentable sector. This trait also tracks with software as well, which is the comparable sector VCs compare to Energy Efficiency.

• After US, Japan and Germany leading in corporate innovation, but lagging in venture investments

• Don’t discount the impact of Corporates on cleantech innovation. Corporates remain active in investments and patent filings.

Patents and VC Trends

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Insight into innovation

is Cleantech Group’s new interactive, proprietary market intelligence solution providing insight into:

•the most important companies in the cleantech sector

•the latest technology trends

•the financial transactions and relationships shaping the sector’s competitive landscape

Introducing i3

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Insight into innovationDashboard: Your Cleantech Radar

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Daily feeds of the latest investments, acquisitions and relationship news

Newest company profile reports added by our senior analysts

Coming soon – direct access within i3 to all supplementary research documents and Investment Monitors

Search by company name, sector, or keyword

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Insight into innovationCompanies: Search for innovators

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Select the type of search you would like to run: companies or transactions (investments, M&A, IPO)

Search on tags (begin typing for auto-complete)

Browse listing of most common tags

Every company is listed in one of these primary tags

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Insight into innovationCompanies: Search results

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Click to sort results by column headers

Download results in excel for offline processing and analytics

Returns total # of deal and combined $ value - all forms of capital.

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Insight into innovationCompany View

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Long form analyst insight profile

Detailed investment data; click through investors to get to an investor profile

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Insight into innovationRelationships NEW!

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Beginning to track a range of company relationship types• Customers• Licensing Partner• Technology Partner• Project Dev Partner• Channel Partner• Joint Venture

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Insight into innovationQ&A