Quick lesson for anyone who isn't sure what Venture Capital is, for those of you who do just skip ahead. From Wikipedia-
"Venture capital is a type of private equity capital typically provided to early-stage, high-potential, growth companies in the interest of generating a return through an eventual realization event such as an IPO or trade sale of the company. Venture capital investments are generally made as cash in exchange for shares in the invested company.
Venture capital typically comes from institutional investors and high net worth individuals and is pooled together by dedicated investment firms."
My point to posting this is that one way to find green investment ideas is to take a look at what types of green companies venture capital dollars have been flowing towards. An article I found written by David R. Baker from the San Francisco Chronicle indicates that nearly 46% of the money invested in green technology in 2008 went to solar power companies.
Flow of Venture Capital for Green Tech Companies
What this means is rather large investors are betting large portions of their wealth on solar power becoming a widely used energy source moving forward. It would behoof any investor to take a look at adding a company from that energy sector to their portfolio.
One other opportunity I would like to mention is the same article goes on to talk about the shift in investment from the biofuels such as ethanol and biodiesel to the synthetic biology fuel produced from algae. Take a look at this article posted on greenchipstocks.com written this past summer.
There are several companies listed towards the bottom of the article which are worth keeping an eye on for a possible future investment.
6 comments:
It's funny that you discuss solar. I was just reading the article Obama's green energy plans build hopes, skepticism from the Greeniuses Buffet, which states;
"Solar stocks climbed after Obama said his economic recovery plan would result in more jobs building solar panels.
First Solar Inc rose 4.6 percent to $155.36, LDK Solar closed 5.2 percent higher at $14.50, and SunTech Power was up 6.3 percent at $12.75. The shares outpaced the broad S&P 500 index, which climbed only 0.3 percent."
I mentioned First Solar a couple months ago as a Green stock to watch. Looks like I should have taken my own advice and laid down some cash.
Yep, should have bought First Solar. I just checked and when I first posted about this company on November 22nd the share price was at $93. Going off todays share price of $155, that would be a 67% return. FYI, the 52 week high is $317 so this stock has room to grow.
Darn it! We're always a dollar short and a day late when it comes to green investments.
It's good to see that the truly renewable energy sector is getting so much play, as opposed to the inefficient and politically motivated ethanol industry. Why turn food into gas when people are starving because of high food prices? Insane. Sunlight is abundant, powerful, and technologically doable right now. It just makes sense, and it's only going to become more feasible once the industry scales and costs come down.
Yeah. Let's think of something that we already consume every bit that is produced and give it another use. Dr. Denslow taught me that that will make the price go up. Why our government was and is so caught up in ethanol is beyond me. It's frustrating that Obama's pick for Secretary of Agriculture is an ethanol man, because I was hoping that we could shift away from that.
With Obama, you sometimes have you think ahead a couple of moves. Maybe he plans to make some serious changes to our policy towards ethanol, and having a Big Farm/ethanol insider handling the ordeal might be a smart move. If a well-known pro-ethanol guy says this is what needs to happen, it's more credible to the ethanol industry than if an outsider says it. Make sense?
You also can't go too liberal with your Agricultural pick as farmers tend to be conservative folk.
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