This impression leaves me feeling a certain degree of concern primarily for the cleantech sector. If you are an electrical engineer designing cutting edge semiconductors in Palo Alto, I’m not worried about your business prospects; you’ll be fine. If you are a microbiologist developing lifesaving pharmaceuticals in Boston, I’m not worried about you, either. And if you are a cognitive scientist applying air force simulator training to user experience on the Internet with offices are in Tel Aviv, I’m confident that you, too, are in your element.

Here’s who I am worried about: the fluid dynamics physicists in Texas developing better turbines for wind energy; the botanists in Nevada developing agricultural technology for arid regions; the civil engineers in Ireland figuring out a grid system for electric cars; Chinese desalination specialists bringing water tech to the next level; photovoltaic scientists working to solve storage issues in Spain, and the biochemists developing more efficient bio gas in Germany. Why am I worried?

Because despite the fact that the scientists mentioned above are all engaged in creating cleaner, more efficient energy and working diligently to solve the environmental challenges we face and helping to make the earth well again, they are functioning without the benefit of what economists and sociologists call a “cluster” – a concentrated space where professionals in similar fields support one another through their common occupation and like minded pursuit of common goals and objectives. Without these so-called clusters or centers of excellence, these scientists face nearly insurmountable challenges in making the leap from science to business. In each case, business education, personal connections and experience in dealing with the venture capital and angel investor community are sorely lacking.

Here are some facts: Silicon Valley is an IT, biotech and telecom cluster and has been for more than 50 years. Boston has been an IT, biotech and telecom cluster for just as long. Israel, whose startup ecosystem contains clusters of these industries as well as military and security technology, has been a cluster for more than 20 years.

This means that not only do the professionals in these fields “cross-pollinate” their ideas, but they can also pick the brains of attorneys, transfer officers, government officials and especially the business experts – namely VC’s – who can help their companies grow. These men and women of science and technology recognize that ventures cannot succeed just because you have a brilliant idea. Success in the model we are considering requires access to capital, well conceived marketing plans, and the ability to sell a finished product. In short, scientists need connections to experts outside the cloistered hallways of academia.

According to Tim Harford, Financial Times economist:

“The more knowledge intensive an industry is, the more that industry is concentrated in a small area… Looking at the locations of over four thousand commercial innovations developed all over the United States, economists have found that more than half came from just three areas: clusters of innovation in California, New York, New Jersey and Massachusetts”. (The Logic of Life, pg. 160)

Unfortunately, cleantech and renewable energy researchers and developers do not currently operate in concentrated clusters like other knowledge intensive industries. This means that the first five employees in your average clean-tech company are all scientists with impressive IQ’s, world-changing ideas yet very little understanding of the technology ecosystem. These cleantech companies operate in a vacuum of solitude without the availability of local business support and localized idea sharing.

To make matters worse, professionals in the cleantech space such as aerodynamics experts involved in making electric cars for example, are employed by giant corporations such as NASA and Chrysler. What do they know about the frenetic pace and culture of start-ups? Since cleantech R&D is already a long, arduous, and expensive process, any further obstacles to success such as a lack of basic business expertise is proving catastrophic for these talented, young start-ups.

Another challenge these cleantech founders face is a lack of education. Currently, universities in cluster areas such as MIT in Boston and the Technion in Haifa offer business courses as part of their electrical engineering programs. Indeed, it is common in these institutions for engineers to have MBA’s. Yet time and again I meet with cleantech companies, both as a venture capitalist and as an educator, where I am the first and only entrepreneurial educator these scientists have encountered!

What fate lies in store for those entrepreneurs lacking basic business acumen who are otherwise the most educated people on the planet? Expensive mistakes. The list of expensive mistakes includes competitors edging out their company’s technology and investors losing money and interest in their solution. Internet companies in the late 90′s faced a similar quandary: professionals in every field thought they could launch billion dollar web companies just by being experts in psychology, or medicine or communications. It took the 2000 crash to make them realize that without competent, well-trained business experts, companies faced an uphill battle in their struggle to survive.

These problems are not going to be solved overnight, and the cleantech industry is not going to spontaneously form into a cluster. However, instituting better business education within the cleantech curriculum is an attainable goal.

Here’s what I suggest as a first step: we need to institute programs similar to Stanford University’s Tom Byers. He has managed to do for hi-tech – making technologists comfortable in the business ecosystem – what we must work quickly to do for renewable energy. Adding business and economics courses to the curriculum of science degrees would significantly improve the cleantech start-up founder’s chances of leaping from idea to IPO with less time and much less pain. There’s enough work to do bridging the education gap within the cleantech world for me to quit my job as a VC and teach fulltime.

But if cleantech entrepreneurship continues to be neglected around the world, our industry is never going to grow at the rate it should and at the rate we need it to grow in order to solve our environmental problems. The field of renewable energy needs to rally and educate our scientists about an ecosystem that is itself specialized, even within hi-tech.

Perhaps getting a PhD in electrochemistry or biotechnology should require courses in economics and international law so the people manufacturing the batteries for the future’s cars or developing new kinds of water filters will not find themselves “out of their element” when they meet investors and lawyers.

If we can dream of running the world on sunlight, why can we not conceive of a cluster of business savvy scientists working together to help reach our common goals?

Venture capital is the fuel that drives innovation in many sectors vital to the health and growth of the US economy. As a cleantech venture capitalist, I am in a unique position to understand the circumstances threatening American innovation and with it, the U.S. economy.

Since the 1970’s, the role of venture capital has been to nourish entire new industries, including biotech, software development and online retail. In 2008, VC-backed companies employed 11% of the private sector work force – over 12 million people.

Cleantech needs as much venture capital support as it can get. It is an emerging industry aimed at solving the biggest problems such as climate change and our dependence on foreign oil. However, many of its products and services are still not commercially viable. The only way an industry with no immediate revenue stream can build the technology of tomorrow is through investment. Direct government support can only go so far, and it is the venture capital and angel community that will pick up the slack.

Recently, VC investment in cleantech companies has skyrocketed reaching $5.6 billion last year. If the VC industry implodes, cleantech falls with it.

The U.S. government, under the leadership of the Obama administration is undermining the green economy by a). misappropriating government stimulus money aimed at job creation and b). levying unfair taxation on the venture capital community – the very source within the private sector that generates job growth.

Stimulating job growth can only be achieved when the government is willing to support those sectors of the economy that hold the promise of growth like renewable energy and cleantech. It is a known fact that the biggest players in the economy fall behind the small, more nimble players when it comes to innovation and job creation.

Take the automobile industry, whose propensity to ship jobs out of the country has laid waste to cities like Detroit. The industry’s stubborn refusal to innovate, which has even been documented in film, brought it to the brink of collapse recently.

Yet, when push came to shove, the government stepped in to save these dinosaurs with enormous wads of taxpayer cash. Additionally, policies like Cash for Clunkers were designed to augment their bottom lines. The federal government even took control of 60 percent of General Motors.

Why pour federal dollars into propping up companies that refuse to innovate? Is this not a misallocation of resources at a time when so many new, pioneering companies are desperate for support? In 1998, both Google and eBay were tiny companies with fewer than 30 people working for them. Had it not been for venture capital (and the federal government’s support of these VCs), those startups would have faded away into obsolescence.

The Missed Opportunity In the Stimulus

Looking at the stimulus package today, one can see that it was a missed opportunity of gigantic proportions. $80 billion in stimulus funds were dedicated to cleantech – in effect making the government the country’s largest venture capital firm. Yet, instead of using this massive investment to encourage a new crop of innovators, the majority of the funds were funneled to big corporations.

To keep our economy strong, we must invest in America’s long-term competitiveness. Government support must be directed at small startups and research universities – and not at the big fish. This approach has worked for the country in the past, and it can work again today.

We must return to the days when American innovation flourished thanks to government-sponsored research conducted by universities and national laboratories. The federal government typically invested between $250,000 to $2 million on seed projects encouraging venture capital firms to step in and invest in the best and most promising of the government sponsored ventures.

This goes all the way back to the post-WWII period, when Vannevar Bush convinced Harry Truman to continue government support for science and technology research during peacetime. As a result, we got the Internet, Yahoo , Google, Fairchild Semiconductor and a long list of successful companies.

Taxing Innovation – A Case of Mistaken Identity

Not only is the government failing to support tomorrow’s innovators, it is also taking misguided steps to deter others from doing so as well. The recent “Carried Interest” bill that passed the House of Representative’s vote last Friday is emblematic of this approach by the federal government. The bill’s most grievous problem is that it lumps venture capital funds together with hedge funds and private equity funds.

With all due respect to the anti-Wall Street atmosphere in the country right now, hedge funds and venture capital have nothing to do with one another – aside from the fact that both speculate. But while hedge funds speculate on virtual instruments like derivatives, venture capital funds speculate on real companies with the promise of jobs resulting in measurable benefits to our economy. Moreover, hedge funds use leverage while venture capital firms use their own capital. The economy is suffering because of the high degree of leverage characteristic of the financial services sector.

Unlike private equity funds that buy companies, break them apart and sell off the assets, venture capital investment creates goods and services and puts jobs back into the U.S. economy. I still recall one of President Obama’s promises prior to winning the election in 2008 – job creation. Venture capital has done as much (if not more) to drive innovation and job creation in this country as the federal government.

The government wants to tax venture capital as part of a proposed hedge fund tax reform. The Baucus?Levin legislation now circulating in the House and Senate and it’s new carried interest tax hike represents a 157 percent tax increase over the next three years on growth capital investment. The new legislation proposes to treat 50 percent of “carried Interest” as ordinary Income and 50 percent as long-term capital gains in 2011 and 2012. By 2013, the tax treatment for carried interest would be 75 percent ordinary Income and 25 percent capital gains which would raise the effective tax rate to more than 38 percent.

Due to the financial crisis of 2009 and 2010 however, venture capital has shifted to safer bets and, as a result, far less seed capital is available for early-stage innovators, scientists and entrepreneurs. Over the coming year, there is a good chance that the $30 billion venture capital industry could permanently shrink to around $15 billion. A move to level new taxes on them at this time, when the industry is already on the edge, is a move to stifle innovation. The new proposed tax on VC’s is punitive and ill?conceived. This will discourage risk taking required to start, grow, and save American companies.

Clipping the Angels’ Wings

The government also wants to level new taxes on “angel investors” – individuals who invest in startups and entrepreneurs. At the same time, new legislation will impose additional regulation on these individuals, ostensibly to “protect” them from bad investment choices like those that brought down the housing market. The reality is that the legislation makes it much more difficult for firms like mine to solicit investments from high net-worth individuals.  It deprives a class of smart and self-made millionaires from tax benefits their higher net-worth neighbors will enjoy.

Angel investors are people with a high level of understanding and sophistication, and are responsible for most of the initial investments in startup companies today. Leveling new regulations and taxes on them is likely to shrink this source of investment in our economy.

It’s still not too late to change the course. Our country can no longer afford to prop up the big boys, while leaving the little guys to fend for themselves. With economists like Paul Krugman proposing additional stimulus spending, we must be quick to learn the lessons of the first stimulus plan. And there is still time to design tax codes and regulations that encourage, rather than discourage, innovation.

American innovation is our greatest resource, and nurturing it is the only way we can maintain our lead over fast-developing countries like China, India and Brazil. Mr. President, the country’s innovators are counting on you to make this right, before it’s too late.

Photo by dcJohn

China is now the leading manufacturer of solar panels in the world, and last year became the world’s largest producer of wind turbines as well. According to one recent report, China is now poised to surpass the West in virtually all areas of clean energy, including transportation technologies, advanced batteries, solar water heaters and even next generation nuclear and “clean coal” technologies.

China’s pull is so strong these days that it has even begun attracting cutting edge firms away from places like Silicon Valley. And its geopolitical aspirations are equally ambitious. This month a plan for a transcontinental high-speed railway, from Beijing to London, was revealed. It no longer seems improbable that, as a 26-year-old Chinese engineer told a New York Times reporter recently, “China will lead everything.”

All of this is occurring, despite the fact that China is a one-party system without elections or democratic institutions. How did this most capitalist of communist states, known until recently as one giant sweatshop, take such a profound lead over the democratic West?

Or, to put it another way, what in the world would motivate a government to build a model green economy from scratch, when it doesn’t even have to worry about being voted out of office?

Here’s a clue: A 2007 World Bank study found that air pollution kills three quarters of a million Chinese every year. This number so embarrassed the Chinese government that it prevented parts of the report from being released to the public. Although things have improved somewhat in recent years, clean air remains a scarce commodity in Chinese cities and pollution-related diseases are still the leading cause of death in China.

China also faces food security issues. With 20 percent of the world’s population living off of 7 percent of the world’s arable land, a hectare of land in China must produce enough to feed 10.3 people (compared to 1.6 in the U.S.). Yet, while the population continues to grow, China’s supply of arable land is dwindling, due to soil degradation and water pollution.

Add to this the additional 300 million people that are expected to crowd into China’s urban areas over the next 15 years, and an expanding middle class, and it becomes quite clear that the number one threat to the health and well-being of Chinese citizens is pollution and environmental degradation. And anything that threatens the well-being of hundreds of millions of Chinese is also a threat to the stability of the regime.

Enter cleantech. Ostensibly an excellent means to clean up the environment while putting some of those hundreds of millions of city dwellers to work, the Chinese government has clearly identified the green economy as a key element of its survival strategy.

According to the above-mentioned study, the country is set to pour a whopping $400 billion into clean energy and green technologies over the next five years. That’s well over twice what the US will be spending, even with the greener elements of the Obama Administration’s stimulus package.

As an undemocratic country, China does not have to waste time arguing over policy, budgets and the usual partisan battles. And as a rapidly developing country, China is able to “leapfrog” outdated development models and technologies in favor of new and innovative ones.

For example, one of China’s most serious environmental problems, air pollution, is due to the country’s heavy reliance on coal-burning power plants, a technology as old as the Industrial Revolution. While the government has demonstrated its ability to clean the air using short-term solutions (especially ahead of the 2008 Beijing Olympics), it is one of the world’s first early adopters of “clean coal” technologies, such as carbon capture and storage, that may end up cleaning up coal’s mess over the longer term.

High-speed rail is another good example. Until only a few years ago, China had no high-speed rail service whatsoever. But when its transportation limitations began to hamper its manufacturing capacity, China decided to create, from scratch, a massive network of high-speed rail lines. That was in 2004. Today, China has the world’s most extensive high-speed rail network, with 42 lines expected to be in operation two years from now.

Such an extensive transportation network will make China that much more economically competitive. But, as Stephen Gardner of Amtrak told the New York Times: “The sheer volume of equipment that they will require, and the technology that will have to be developed, will simply catapult them into a leadership position.”

So, while no red-blooded American would suggest that the West abandon democracy for a China-inspired one-party system, the unique conditions that make China a cleantech forerunner will be difficult to challenge. China’s decisive investments along with its swift policies that help its investments bear fruit should — and can — serve as a guide to Western governments if we hope to keep up with China.

Photo by Matthijs Koster

Solar energy, despite all of the effort to increase its usage, still only accounts for less than one percent of the energy we consume.   The amount of solar energy that reaches the Earth’s surface every hour is greater than mankind’s total demand for energy in a whole year. The total energy stored in the world’s supply of fossil fuels is equal to just twenty days of solar energy.  By any measure, the sun is a powerful and virtually limitless source of energy and it is imperative that we capitalize on this clean energy source by increasing our use of solar energy and reducing our reliance on fossil fuels.

How do we begin to capitalize on such a rich source of energy?  Both distributed and utility-scale solar energy projects are vital to accommodate the world’s growing energy needs as they are both suited to harness the extraordinary power of the sun.   The underlying technology used by utility and distributed solar is different and understandably, each has its own proponents and detractors.  For the most part, utility-scale solar projects use solar collectors to generate enough heat to power a steam turbine that in turn generates electrons.  Distributed solar energy derives primarily from the use of photovoltaic panels that capture photons and convert them into electrons. Distributed PV efficiency is improving all the time.   Currently, there is a conversion efficiency of approximately 17% for crystalline silicon panels and 10% for thin film panels — a dramatic improvement from only a few years ago.

In California alone, there are plans for 35 utility-scale projects that would generate approximately 12,000 Megawatts (MW) of energy annually — an amount of energy comparable to the combined power of ten nuclear power plants.  The Mojave Solar Project and the Genesis Solar Energy Project, both located in southern California, are two of the largest projects under consideration and are each aiming to generate 250M watts of energy. These projects are expensive, however, in terms of both dollars and natural resources required. The federal government has promised to help reduce the financial cost by allocating a portion of the stimulus plan for this purpose.  Companies that have their plants ready to be opened by the end of this year will receive a portion of the $67 billion of federal money that has been set aside for renewable energy projects (including loan guarantees and grant programs).

Despite these incentives, it is risky to undertake a large-scale enterprise like utility-scale solar power in an uncertain economic climate, as financial institutions are reluctant to be involved in billion-dollar projects.   Another issue is the fact that such solar ‘farms’ require huge tracts of land. The Bureau of Land Management (BLM) has been tasked with finding 24 tracts of public land of three square miles each with good solar exposure, favorable slopes, road and transmission line availability. Additionally, the land set aside for utility-scale solar farms must not disturb native wildlife or endangered species such as the desert tortoise, the desert bighorn sheep, and others. The wildlife issue has proved to be a contentious one. Projects in California have been halted due to the threat caused to endangered species resulting in a backlog of 158 commercial projects with which the BLM is currently contending.

Another challenging issue for utility-scale solar projects is the use of water.   Combined, the Genesis and Mojave projects would use 1.24 billion gallons of water per year due to the wet cooling systems involved.   One alternative to wet cooling systems, dry cooling, uses 90% less water, but can only handle the full cooling load up to temperatures of 85?-90?F.   As a result, dry cooling in deserts is not cost efficient.   Just as challenging is the fact that to date, there are no affordable storage solutions for utility-scale solar projects.   Without the means to capture and store excess electricity produced by solar farms, an enormous inefficiency is created.

An alternative to utility-scale projects is the use of distributed solar energy.  There are various types of renewable power technologies in use, but sub-utility scale power photovoltaics (PV’s) account for 98% of the distributed solar energy market.  Unlike utility-scale projects, distributed energy is solar power on a small scale and entails the installation of solar panels on the roofs of buildings.  Toward the end of 2009, the California Public Utilities Commission unanimously voted for the Southern California Edison’s Plan.  This plan recommended scattering solar panels on rooftops all over the region in an effort to create 500MW of energy.  Like utility-scale, the plan benefited from the 30% federal tax credit for renewable energy projects.

Distributed solar power does not involve the legal red tape, the large tracts of land, or the vast quantities of water that utility-scale projects require, and has the ability to generate enough energy for homes, schools and hospitals.   Installation is easily addressed and solar panels can last for up to 30 years if well maintained.   The price of solar panels has dropped dramatically to approximately $2.40 per watt (price depending on scale of order) for silicon panels and is likely to drop even further in 2011.   Furthermore, unlike utility-scale projects, distributed solar projects such as the Southern California Edison’s Plan spread capacity evenly, distributing benefits and drawbacks.   If a utility-scale project “crashes,” it affects a huge area.  With distributed energy, only individual units are affected in the case of a power outage.

In many locations and in certain circumstances, distributed solar projects are less expensive than utility-scale solar projects because of the avoidance of both new transmission lines and line losses — the latter of which typically accounts for approximately 7% of the power shipped over transmission systems. The costs associated with utility-scale solar projects are often not included in the side-by-side economic comparison made between the two forms of solar power development.  An additional benefit of distributed solar is its ability, when developed in clusters (i.e., local micro-grids), to alleviate the need to upgrade distribution substations and add local peaking plant capacity.

As mentioned, distributed solar plans have their detractors. Solar certainly is not the cheapest source of electricity and is only effective in areas with a high percentage of sunshine.   More than 50 million Americans live in Community Associations where we might expect to see efficient adoption of distributed solar plans. But these locations commonly have policies limiting the use solar equipment due to height restrictions or other specifications regarding roofing materials.

Utility-scale projects may have the capacity to generate enormous amounts of energy but they represent a huge financial risk, irretrievable waste of resources, and threats to endangered species, all of which are problems that may take years to solve.  On the other hand, distributed solar power entails a fraction of the risk posed by utility-scale projects and is poised to capitalize on the vast opportunity offered by 140 million residential rooftops in the U.S. alone, not including all of the commercial rooftops available for PV installation. Distributed energy is certainly the way forward in the field of solar energy use.

Photo by Pink Dispatcher

Is Social Media really here to stay?

The statistics below indicate that this is not simply a fad, but a real paradigm shift.

• 88% of marketers are using social  media
• 67% of global web-users visit social network sites
• 10% of all time spent on the internet is on social media sites
• 77% of all active internet users regularly read blogs

Not surprisingly, the media has been focusing on the rapid adoption of social media and its various benefits and applications, but to really capitalize on these tools, we need to take a closer look at what they are all about.  Only then can we discuss how best to implement social media, from the perspective of a startup.

What are some of the social media networks out there and what do they do?

The following are 3 popular and important social media sites:

• YouTube is a site owned by Google that enables individuals and businesses to post video content.  It has been ranked as the fourth most visited website on the Internet, with over 100 million viewers watching around 6 billion videos each month.
• Twitter is a free service that allows members to send short messages (known as “tweets”) to their “followers”.  It recently experienced a 1,382% monthly growth rate with over 55 million monthly visits.
• LinkedIn is a growing business-oriented social networking site that allows users to post their professional or business profiles.  With over 50 million users from around the world, it’s understandable why 80% of companies utilize it in some form.

What is the value of social media networks?

Social media is really about two things; raising awareness of your company and tapping into relevant online conversations that affect your company and its technology.  Today, when such a large percent of your audience is using social media to research just about everything, drawing online attention to your company and learning about your audience’s needs through these networks, is clearly one of the keys success.

The formula for success with social media

The formula for success with social media consists of the following concepts:

• Authentic participation whereby your company is part of the online conversation by offering helpful information that the industry members can benefit from, without any sales-oriented edge.
• Acknowledgement of constituents is expressed by embracing your customer or potential client’s issues or concerns, rather than running from them.
• Brand consistency is created by an unchanging presentation of your company’s value offering, coupled with unwavering commitment to a high level of service.
• Persistence and perseverance will ensure that your social media campaign will yield solid results within 6-12 months.

Some examples of Social Media in action

These real-life examples showcase how social media can positively impact your company and its products.

Raising awareness and acknowledging constituents

A friend of mine is a serious bicyclist and rides a Turner mountain bike. He often posts questions or answers on a popular biking forum for Turner and on several occasions, Dave Turner, the owner and designer of Turner Bicycles, joined forum threads to answer questions, give advice and even explain why his company could not replace damaged parts in certain situations.

My friend noted that the interaction with Turner made him a more loyal customer because not only did Turner provide valuable advice in the convenient setting of the forum, he provided the information personally, forging a relationship which is essential when building up a strong customer base.

Using content creatively to educate your target market

A recent Wall Street Journal article described how Matt Miller, the founder of rugged tablet computer maker MobileDemand, demonstrated the resilience of his company’s handheld computers. Instead of writing about how his design enabled his product to survive crash landings, he created videos for YouTube.  In one clip, his computer withstood sub-zero temperatures, while in another the device was “accidentally” dropped off the side of a mountain, and kept on working.

An additional benefit of utilizing video content is derived from Google’s website search and ranking techniques which diversify results to include YouTube and other media formats in results pages.  Using video content along with SEO (search engine optimization) can leverage this shift to your advantage.

How to begin with social media

Social media is a discipline with unique methods and techniques.  As such, companies that try to do it in-house with little prior experience are oftentimes spinning their wheels unnecessarily.

Many business owners cite ‘time’ as a critical element in deciding whether to employ an outside marketing firm. Out-sourcing social media, while costing them a few bucks, allows them to do what they did best; running their business.

Also of importance, is the fact that marketing companies that are already using social media have created economies of scale, and can pass along their savings to the client.

Clearly, to achieve maximum ROI in social media, it’s wise to out-source it to the experts.

Expansion Media is full-service marketing company with this expertise and brings an integrated approach to social media, with its full suite of tools and services available for their clients.

Clean technology comes into play as soon as you start limiting sunlight in a tall building and deal with too much or too little sun in the 10 months of the year when you have to make modifications.  Using a hydroponic system allows most easily for artificial light application indoors addressing most of the climate related difficulties.  There are three main forms of hydroponic system and each is best suited for what it grows.  A system of shallow ponds with styrofoam floats is best suited for head and more mature plant  production.  Systems that periodically flood roots (NFT) are best suited to taller crops or where picking of the produce is required.  Aeroponic systems which spray the nutrient solution onto the roots is best suited to baby leafy green production.  By adding artificial sources of light, any of these systems could be moved indoors – into the empty buildings in most urban areas and initiate the vertical farming that is predicted to come.

The process of making textiles can require several dozen gallons of water for each pound of clothing, especially during the dyeing process. Amid tightening environmental regulations and a push to save money, companies are working to reduce the waste.

One such company working to cut its water use is Colorep, which is based in California. Its AirDye technology, used for the occasional window shade or T-shirt, employs air instead of water to help the dye penetrate the fiber, a process that Colorep claims uses no water and requires less energy.

The technology works only on synthetic materials and is currently available only in the United States (where only a small fraction of the world’s clothing is made, of course). But Colorep says it plans to extend its use to Europe by the end of summer, and to Central America by late this year.

Todd Copeland, who monitors the environmental impact of materials for the outdoor clothing manufacturer Patagonia, said that one of the sewing factories in the United States that does contract work for the company is currently installing AirDye. One limitation: “It does not work on cotton or wool or the other fiber types that we use to make our products,” Mr. Copeland said — though he noted it does work on polyester.

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Defining the Terms
In order to make this prediction with any degree of accuracy, we need to define ‘clean’ technology.  To date, clean or green technology, often referred to as clean tech is composed of several categories and sub-categories including, although not exclusively:

* Renewable energy (Solar, Wind)
* Energy efficiency
* Storage
* Pollution remediation
* Water purification/desalinization
* Agricultural advancement

Dispersion of Clean Tech Knowledge
Part of the challenge of establishing a center of excellence for clean tech is that, unlike IT, its genesis can take place at any university or laboratory around the world.  The necessity of a Silicon Valley or Route 128 has been lessened by the fact that electrical engineering is no longer the only academic background required to solve environmental and energy challenges.  Microbiology and chemistry graduates are more likely candidates to find employment at clean tech startups than their electrical engineering counterparts.  The universe of clean tech companies which been created in the Internet age have cropped up all over the globe, seemingly with no bias toward any particular climate or time zone.

Israel as the Future Clean Tech Epicenter – The Pros
Various places lend themselves to certain clean or green technology sectors; solar technology in the Middle East, for example.  Due to the country’s urgent need for reliable solutions to deal with its own environmental challenges (mainly the water crisis) Israel’s clean tech market has become very attractive to foreign investment.  Despite being one of the world’s most arid regions, experiencing ever-growing water consumption and alarmingly low levels of rainfall, Israel has succeeded where others have failed.

Water demands have been answered over the past few decades by effective water management, including rain harvesting, flood reservoirs and the introduction of innovative irrigation methods serving their agricultural demands.  Significant advances in desalination of seawater, recycling and purifying municipal wastewaters, and reclaiming sewage waters have been achieved by Israelis.  At least 30 percent of agricultural water is drip-irrigated to orchards and non-food crops.  Relatively speaking, Israel has devoted more resources to the development of wastewater treatment and reclamation than any other country in the world.

Israel has a head start in experience with solar thermal as nearly all apartment buildings there have simple solar thermal panels on their roofs.  Motivated more out of will to survive than a hunger to solve environmental issues, Israel has more reason than most nations to wean itself off of crude oil.  While every country wants to lessen its dependence on crude oil, for Israel it’s personal.  This may prove to be one of the most compelling arguments for why the relatively small nation state may indeed become the next epicenter of clean technology innovation.

Israel is home to Ohmat, one of the leading companies in the world for geo-thermal power plants and recovered energy in the world.  In agriculture, Israel is the birthplace and world leader in drip irrigation, literally turning a dessert into an agricultural country.  Netafim is the world leading company in this field. In the storage arena, Israeli Tadiran has become one of the leaders in long-life industrial strength batteries.  The fact that Israel is located centrally, with easy access to Asia and Europe have enabled these companies to realize customers on several continents while operating from Israel.

Israel as the Future Clean Tech Epicenter – The Cons
To date, there are no leading Israeli solar power companies on the market today and Luz 1 was a failure. There is an innate inertia at work in Israel to stick to what it knows best – I.T. and telecom, stifling potential investment and devotion of talent toward clean technology. While there is no shortage of smart scientists and clean tech research, there is a surprising lack of clean tech entrepreneurs.

Historically, Israeli’s are good at improvisational thinking within an already established category (think ICQ).  Clean tech, however is a completely new paradigm that requires category builders more than improvements.  One need only look at the mass of ‘technology refugees’ to see that Israeli’s have been slow to adapt to the new opportunities in clean technology.  Conversely, technology entrepreneurs within the US have been migrating over to the clean technology sector in greater numbers. Part of the reason that this migration has been slow is that the Israeli entrepreneurs and scientists are too isolated from one another. Overtures from one side to the other are missing.  Furthermore, scientists are slow to leave their tenure posts at universities for business ideas that are admittedly a few years out from proving themselves.

Lastly, Israel is a small country.  Currently, there just aren’t enough demonstration projects to show to the rest of the world.  Without the significant helping hand of a large government endowment, Israel’s chances of competing with the likes of the US, China and India seem unlikely. The same location that provides regular and dependable exposure to the sun leaves Israel in a region of the world almost bereft of wind when compared to Europe and the Americas.  Not surprisingly, there isn’t much wind energy in use, nor are there many wind experts.

What must be done?
More dating between university research and entrepreneurs is the only way to create a marriage of industry and science.  This effort, coupled with a shift in focus from the Office of the Chief Scientist, placing more grant money in the hands of clean tech companies (currently it represents less than 15 percent) needs to occur for Israel to distinguish itself from its alternatives.  In summary, Israel must realize that clean tech is certain to be one the growth industries of the next ten years.  To truly lead the world in clean tech investment and innovation, Israel must have greater support from the state.

To search for innovation we must search for pain. If people’s wallets aren’t hurting there is no innovation to be made or to sell.
The financial crisis is the largest problem facing the world right now and technology has the ability to solve part of the problem and ease the pain.
In health-care, there is a lot of pain, so we will see innovation.
   
But truly the most pain in recent years has come from the utilities. Volatility of gas prices, rising carbon emissions and general awareness of global warming have created big losses for the utilities.
  
Looking forward, clearly the most innovative ideas and the most disruptive technologies will come from the clean tech industry. That is the industry that has the potential to save people the most money.
   
But for new innovations in clean tech, there needs to be a new breed of scientists. To create a more efficient wind turbine you need an aerodynamic expert. Sure solar cell producers need semiconductor people, but there is a need for a wide range of experts in various fields alongside them. Battery’s need electro-chemists, a field that has yet to participate in the tech boom. More electrical and Mechanical engineers are not going to be the people that design the best wind turbines or harness the earth through geothermal power, geologists will.
   
For this to happen, there needs to be a shift in what people go to study. Smart minds need to realign their priorities before looking into graduate programs. The computer science departments at MIT and Cal Tech won’t be teaching the innovators of tomorrow.
   
The problem is not just that we have these problems, but we do not have the people to solve the problems.

This 13 week course is specifically designed for graduate students, postdocs and science entrepreneurs who want to build businesses that commercialize university-owned intellectual property or have a deeper understanding of the issues involved in taking the right idea from the laboratory to the marketplace.

The next course starts this coming Tuesday evening, Jan 20th. If you know any scientists that could benefit from such know-how, please feel free to forward them this post so that they can sign up before it starts.

Syllabus
http://www.nyas.org/pdfs/ipo09_syllabus2.pdf

Registration Link
www.nyas.org/IPOcourse

Course Description
Increasingly, science researchers are engaging in or starting entrepreneurial ventures. Unfortunately, traditional education in the sciences and technology does not include practical information about translating scientific research into viable commercial ventures. This 13 week course is specifically designed for graduate students, postdocs and science entrepreneurs who want to build businesses that commercialize university-owned intellectual property or have a deeper understanding of the issues involved in taking the right idea from the laboratory to the marketplace.

Spring 2009 – Course Syllabus

Module 1: Intellectual Property
1/20/09: Intellectual Property and protection of ideas(part1)
1/27/09: Intellectual Property and protection of ideas (part2)

Module 2: Enterprise Potential
2/3/09: Technology Transfer and the licensing of Intellectual Property
2/10/09: Scientific Due Diligence
2/17/09: Market Due Diligence

Module 3: Enterprise Organization
2/24/09: Employee Incentives and Non-competes
3/3/09: Corporate Structure: taxes and governance

Module 4:  Enterprise Finance
3/10/09: Structuring the Business Plan
3/17/09: The Venture Capital Fund
3/24/09: Term Sheets and Valuation

Module 5: Technology Marketing
3/31/09: New Product Introduction
4/7/09: Initial Public Offerings

Module 6: Enterprise Exit
4/14/09: Scientist as CEO