Advanced Materials: Creating Chemistry between Innovators and Investors
At Cleantech Group, we think AdvancedMaterials might be the dark horse ofthe cleantech sector. While it hasn’tgenerated the same headline successes(or failures) as industries like solar,electric vehicles, or energy storageover the past few years, this sectorhas captured a relatively consistentstream of investments, representingabout 10-20 deals per quarter for overfive years straight. On the other hand,M&A activity has been low besides ahandful of high-profile, large dollar value deals. In addition, IPOs have largely been limited tosomewhat small, predominantly Chinese offerings.Despite the lack of headlines, we believe this sector will continue to be a critical lynchpinof the broader cleantech industry because it represents the enabling technologies thatdefine the performance characteristics of those headline-grabbing subsectors. Advances intechnologies from graphene to composites to bio-based materials will offer a cornucopia ofinnovation opportunities as they become better understood by the market.
Phoenix Venture Partners, a leading venture capital group focused on advanced materials, describes this sector eloquently:
“Advanced materials is unlike other traditional venture capital sectors, which arededicated to fully integrated end product manufacturing, distribution, andmarketing in addition to technology development. Advanced materials areenabling and tend to have diverse applications across multiple industries: enablingnew products, enhanced performance of existing products, and superiormanufacturing process improvements.”
Companies in this sector are not only creating more durable and efficient derivatives of existingmaterials and designing novel materials from the ground up …