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Idealab is Back

13 year old Pasadena based incubator Idealab is back with a vengeance but its new focus might be a surprise to those that remember its’ earlier successes –GoTo.com, Internet Brands Inc., and Cooking.com. The business incubator is now turning its attention to the green technology sector.

Eclipsed? Not totally.
Creative Commons License photo credit: James Jordan

According to Alana Semuels article, “Idealab rebounds with recent focus on clean technology” for the Los Angeles Times, Idealab:

In the last three years, it has created RayTracker Inc., a solar tracking solution for photovoltaic systems; Distributed World Power, which designs solar systems for developing countries; Aptera Motors, which designs fuel-efficient cars; and eSolar.

It is jumping into the environmental market as venture capital is flowing more into clean-tech companies. Investment in such firms shot up 73% in the second quarter from the previous quarter, according to Ernst & Young, and is expected to continue growing.

In the Los Angeles Times article, Semuels quotes Idealab founder Bill Gross that energy “is probably the biggest opportunity of the century. The world’s energy needs and the demand to make that clean energy is going to be a challenge and an opportunity for entrepreneurs.”

In 2000 Gross turned his attention to solar energy, which eventually led Idealab to eSolar. Semuels writes:

The concept for ESolar came about as Idealab engineers started thinking about ways to provide cost-efficient solar energy for utilities and realized that most solar panels in commercial use were too big to be cost-efficient.

“We tried to figure out the angle we could exploit where we can zig where other people zag,” Gross said.

They came up with what Gross calls an unorthodox plan: “Go small.” Rather than make giant solar panels, they sized them at one square meter. That made the panels easier to install, putting them together like Legos rather than erecting a giant solar facility.

The solar energy company built its plant in Lancaster in just 18 months and has already raised more than $130 million in investments. You can read the entire article here.

How to Score Funding, Andreessen’s New VC Firm has $300 Million

Marc Andreessen, founder of Netscape, co-founder of Ning and co-author of Mosaic, recently announced, “the formation of our new venture capital firm, Andreessen Horowitz, and our first fund — $300 million in size — aimed purely at investing in the best new entrepreneurs, products, and companies in the technology industry.”

According to Andreessen, “We have the ability to invest between $50 thousand and $50 million in a company, depending on the stage and the opportunity. We plan to aggressively participate in funding brand new startups with seed-stage investments that will often be in the hundreds of thousands of dollars. But we will also invest in venture stage and late stage rounds of high-growth companies.”

bay bridge across troubled waters
Creative Commons License photo credit: Darwin Bell

In Andreessen’s post “Introducing our new venture capital firm Andreessen Horowitz”,  he outlines seven characteristics he and his partner are looking for:

  • Above all else, we are looking for the brilliant and motivated entrepreneur or entrepreneurial team with a clear vision of what they want to build and how they will create or attack a big market. We cannot substitute for entrepreneurial vision and drive, but we can help such entrepreneurs build great companies around their ideas.
  • We are hugely in favor of the technical founder. We will generally focus on companies started by strong technologists who know exactly what they want to build and how they are going to build it.
  • We are hugely in favor of the founder who intends to be CEO. Not all founders can become great CEOs, but most of the great companies in our industry were run by a founder for a long period of time, often decades, and we believe that pattern will continue. We cannot guarantee that a founder can be a great CEO, but we can help that founder develop the skills necessary to reach his or her full CEO potential.
  • We believe that the product is the heart of any technology company. The company gets built around the product. Therefore, we believe it is critical that we as investors understand the product. We are ourselves computer scientists and information technologists by experience and training; therefore, we plan to focus on products in the domain of computer science and information technology.
  • Here are some of the areas we consider within our investment domain today: consumer Internet, business Internet (cloud computing, “software as a service”), mobile software and services, software-powered consumer electronics, infrastructure and applications software, networking, storage, databases, and other back-end systems. Across all of these categories, we are completely unafraid of all of the new business models — we believe that many vibrant new forms of information technology are expressing themselves into markets in entirely new ways.
  • We are almost certainly not an appropriate investor for any of the following domains: “clean”, “green”, energy, transportation, life sciences (biotech, drug design, medical devices), nanotech, movie production companies, consumer retail, electric cars, rocket ships, space elevators. We do not have the first clue about any of these fields.
  • We are primarily but not entirely focused on investing in Silicon Valley firms. We do not think it is an accident that Google is in Mountain View, Facebook is in Palo Alto, and Twitter is in San Francisco. We also think that venture capital is a high touch activity that lends itself to geographic proximity, and our only office will be in Silicon Valley. That said, we will happily invest in exceptional companies wherever they are.

So, do you fit the bill?