Cleantech startups have stopped seeing GE as an adversary and have started realizing the company can help them make a difference, Kevin Skillern, a managing director at GE Energy Financial Services, said in a keynote speech at a Thomson Reuters conference called “Financing the Cleantech Vision” in Palo Alto on Wednesday.
In spite of the recession, Skillern assured the audience that the long-term business opportunity for cleantech is still there, though it will require “a strong stomach and a lot of patience” to cash in on it. He also called climate change “one of, if not the biggest, societal challenges of our time” and said technology was an essential part of the solution.
GE plans to continue to invest in cleantech startups, he added. “We’re still committed, we’re not going to change our commitment, and we’re going to be a difference maker for these companies,” he said. In January, another managing director at GE said the company planned to take advantage of the downturn to snag good venture deals.
That said, getting funding from GE isn’t easy. “It’s a very ruthless, Darwinian process,” Skillern said.
What makes an opportunity attractive to GE? The company is looking for the same things as other venture capitalists – mainly a big market opportunity, unique technology and a strong team, as well as the risk vs. return, the amount of capital it’s likely to need, co-investors and other things.
But on top of those “standard VC factors,” GE Energy Financial Services also is looking for potential additional value to GE, as well as the potential for GE to add value, Skillern said. For instance, the company is interested in advanced technologies that might be applied to GE’s products or large new market opportunities adjacent to areas GE is already involved in.
Southwest Windpower is one example of the latter. The Flagstaff, Ariz.-based small-wind company in April announced it had raised $10 million from GE and other investors. Skillern said GE is planning seven “high-impact programs” with Southwest Windpower in the next few months, though he didn’t elaborate further.
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