Northwest Energy Angels’ clean-tech investments grow with diversity

Emily Parkhurst, Puget Sound Business Journal | 2/11/13

Northwest Energy Angels announced this week that its members invested nearly $4.7 million in clean-tech companies in 2012, the most since the organization was founded six years ago.

What’s interesting about recent clean-tech investments is their diversity.

Last year’s NWEA clean-tech investments included Portland-based Indow Windows, which makes energy-efficient windows, a clean-energy marketing company called Ethical Electric that just announced a $2.4 million investment round, a sustainability data management software company called Scope 5, and Seattle-based green startup incubator Fledge.

“It’s a very diverse group,” said Lars Johansson, co-chair of the Northwest Energy Angels.

Johansson said that is partially because NWEA’s membership is also diverse. Like many angel firms, some members have IT and software backgrounds. But NWEA also has members who come from the clean-tech sector themselves and even a few from the finance industry.

“We want to be able to build up domain expertise and have an audience that’s more knowledgeable,” he said.

NWEA sees three startup presentations a month and schedules due-diligence meetings with interested investors for a week after the companies present, a system Johnasson said has helped both the startups and the investors make sure they have a clear picture of what the company’s market opportunity is before making a decision on an investment.

Unlike the big capital-intensive clean-tech companies of the past (think solar and wind), NWEA companies tend to be looking for $250,000 to several million dollars to get their companies started. Johansson said NWEA members typically join other angel groups and rarely fill out an entire round themselves.

Johansson, who has himself invested in several of NWEA’s clean tech companies, said he typically looks for companies with a sustainable competitive advantage, often protected by intellectual property, and with a big enough market opportunity to grow.

“Then it’s what you often hear in the early stage: management, management, management,” he said.

Emily Parkhurst covers the technology industry for the Puget Sound Business Journal/TechFlash.

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