‘Clean tech’ deals among the largest in ‘09 venture capital spending

Venture capital investments slowed in a big way last year but ‘clean technology’ was well represented among the biggest funding rounds in 2009, according to a report Friday.

The National Venture Capital Association and PricewaterhouseCoopers released year-end data that showed a 37 percent overall decrease in investment compared to 2008.

Venture spending on clean technology specifically – such as alternative energy and pollution reduction – was $1.9 billion in 2009, well below the $4 billion the prior year.

But “clean tech” accounted for some of the year’s 10 largest venture capital investments. The largest funding round in any sector was the $286 million that California solar panel maker Solyndra Inc. raised.

The money enabled the company to secure a $535 million loan backed by the Energy Department to build a second manufacturing plant. Also in the Top 10: $82 million in venture capital raised by California electric vehicle maker Tesla Motors, Inc.

In addition to the private money, the Energy Department closed a $465 million direct loan with Tesla earlier this week – the company is spending the money on manufacturing facilities in California for its Model S electric sedan and power-trains.

National Venture Capital Association President Mark Heesen predicts that more venture capital will flow in 2010 after a tough 2009.

"The venture capital industry had no choice but to slow the investment pace in 2009. The weak exit environment resulting from an unstable public market combined with a challenged limited partner base sent a strong message to the venture community to pull back the reins -- and the VC's listened. Now that the economy has begun to show signs of improvement, we expect to see dollars flow more freely back into those sectors that offered the most promise before the recession began -- clean technology, life sciences and IT. The seed and early stage pipeline needs replenishing across all industries and the health of the start-up community in the next decade will be dependent upon more robust first-time financings. Twenty-ten should be the year to begin that process in earnest,” he said in a prepared statement.

Here’s a chart that shows the ups and downs of clean tech investing: