Presenting entrepreneurs at NREL’s Industry Growth Forum have just 10 minutes to impress judges with sound business plans that will attract investors to their clean energy ideas. Preparations are nearly complete for the 23rd Industry Growth Forum held in Denver, Oct. 19. Entrepreneurs at the forum will take a stage under hot lights to make their best pitches to panels of discerning judges — venture capitalists (VCs), public officials, and fund managers — who have seen and heard it all before, often in more promising economic times. All the while, a clock will be ticking away the time they have left.
“This year, judges will be looking for more innovation, a game-changing technology,” says Forum chairman and NREL’s manager of Enterprise Development Lawrence Murphy. “There isn’t as much capital available now as in years past, so when VCs make an investment they want to make a bigger investment that could result in large returns.” Forum judges work at private investment and clean-energy firms. They spent many hours reviewing applications and business plans from hundreds of ventures to select 34 presenting companies, then three more days with the finalists at the forum.
NREL’s Industry Growth Forum has grown into the largest national venture event focused exclusively on companies developing clean energy products to serve the electricity, buildings, and transportation infrastructures.
Even if entrepreneurs are not selected to present at the forum, Murphy says applying to the event and attending the sessions serve as a crash course in entrepreneurship and provide extensive networking and partnership opportunities. Successful applicants can expect:
- The Application Process — For many entrepreneurs it’s the first time they have articulated their goals, business model, and elevator pitch to someone other than family and friends. Murphy says most find the reviewer’s remarks useful.
- Preparing for the Forum — Each presenter is mentored by an expert to refine the presentation, business case, and elevator pitch with an eye towards attracting investment.
- The Forum Pitch —Entrepreneurs learn in a few minutes whether judges think they did their due diligence in anticipating what judges — and investors — need to know. “There’s no substitute for this real-time feedback,” says Murphy. “This format lets the clean-energy community hear the concerns and interests of the investment community.”
In 2010, 200 clean-energy entrepreneurs applied. Products and plans were scored by 135 investors and other experts, and 34 were selected to compete as presenting companies. Since 2003, presenting companies have collectively attracted $3.4 billion in capital.
This year’s emphasis is on energy efficiency, energy-management software, thermoelectric, Smart Grid, and building technologies. In previous years, there were relatively fewer presentations on solar, wind, and biofuels. A few years ago the ideas focused on photovoltaic (PV) technologies. A PV idea this year will need a more innovative design, says Murphy. Winners will be announced at a concluding luncheon on October 21.
The top prize is the $25,000 Best Venture Award, which includes $10,000 in cash and NREL in-kind services valued at $15,000. Last year’s Best Venture was Ecovative Design, which grows and forms biodegradable packing materials. Two Outstanding Presentation awards, each valued at $15,000 in cash and in-kind services, will also be announced. Prizes are sponsored by Wilson Sonsini Goodrich & Rosati.
A new opportunity in this year’s schedule is a One-on-One Partnering and Pitch Session on October 19, the first day of the forum. The session provides scheduled, facilitated meetings between investors and entrepreneurs, as well as potential partners and government officials. One-on-One meetings are open to all registered Forum attendees. Innovators and companies that applied to compete as presenting companies receive initial consideration for slots on the investors’ schedules.
Investors range from small venture capital firms to large corporations such as Honda and Chevron. “Big companies are looking to invest in a late-stage project as a strategic partner,” says Murphy. The forum is part of NREL’s broader strategic efforts to accelerate the commercialization of clean-energy ideas and assist entrepreneurs in their search for investment capital and other resources.
Each year, applicants provide NREL with an indication of early clean-tech trends, which helps officials gauge how they can better serve the entrepreneurial sector and foster new companies based on NREL technology. “We want to grow clean-energy talent based on the most innovative ideas and best business plans,” says NREL’s Robert Writz, a commercialization project manager coordinating events at the Forum.
The Forum launched in 1995 as a way to facilitate discussion on new technologies by venture capitalists, public officials, and clean energy entrepreneurs face-to-face.
Many early-stage clean energy firms were failing because they were unable to make the leap from public sector financing to private funding. Young companies needed assistance developing a business pitch and schooling in the expectations, requirements, and processes for raising private sector capital, says Murphy.
Since 2003, the Forum has:
- Cumulatively raised a total of $3.4 billion for presenting companies
- Within a year of presenting, companies have raised $635 million
- Within two years, companies have raised $1.12 billion
- 53.2% of the presenting companies (91 of 171) have received capital investments
- 25 strategic partnerships have been formed
- At least five Forum companies successfully completed an IPO, merger or acquisition.
Similarly, the clean-energy investment sector needed realistic information about the emerging technologies, time-to-market, and an associated risk profile.