Focus on the Fellows: Tom McKinnon

Tom McKinnon, Professor Emeritus at the Colorado School of Mines and Director of InventWorks

In our second installment of Focus on the Fellows, we highlight Tom McKinnon, managing director of InventWorks Inc. and Professor Emeritus at Colorado School of Mines.  Tom has followed a fascinating career path that has included work at NREL (when it was the Solar Energy Research Institute); TDA Research, a small contract research company; University of Colorado; Colorado School of Mines, researching combustion biofuels, “green” fire suppression, and new materials for lithium batteries; Fullerene Sciences Inc., a nanomaterials company; Novare Biofuels; and Boulder ElectroRide, which made high-performance electric motorcycles.  Tom even has experience on the legislative side from when he cofounded a bill for the Colorado ballot to place a small carbon tax on natural gas.

So how did Tom find his way to the field of cleantech?  Energy had been on Tom’s mind for quite some time, and the field of alternative energy was of particular interest to him but he wasn’t sure where to start.  Fate seemed to intervene when he went to a job interview in Boston during his senior year at Cornell University and shared a cab with a man who would eventually become his boss at SERI.  After a few years at SERI, he went east to get his PhD in Chemical Engineering at MIT, researching combustion, and then continued to follow a path in research and energy.

Focus on the Fellows: Tony Formby

Tony Formby, cofounder of Squirrel POS Systems and angel investor

For the third edition of our Focus on the Fellows we are highlighting Tony Formby, a Vancouver, B.C. native who has lived throughout North America and played an instrumental role in the development of touch screen user interface technology before becoming an angel investor, focusing the majority of his attention on cleantech.

Tony started his professional life in Ottawa, working as an aid to the Minister of Justice and Attorney General.  After five years, he realized he had become jaded in his views and wanted different career opportunities.  So in his late twenties he moved back to Vancouver, teamed up with a partner, and entered into the restaurant business, owning two restaurants and running a third on behalf of the owners.  During the recession of 1980, the restaurant industry was hit hard and only one of Tony’s restaurants survived the tumult. Around this time Tony and his partner decided to move into the computerization of restaurant point of sales (POS) systems.  In 1985 they commercialized Squirrel Systems, the first PC-based, touch-screen user interface.  Today, Squirrel POS systems is used by heavyweights such as Apple, Holiday Inn, and Applebee’s.

After significant success with Squirrel Systems, Tony and his partner decided to sell the company and as Tony says, “I saw the opportunity to integrate flat panel display touch screens and customized mother boards with various controllers built into them to create a low profile computer system that could be used in a multitude of process control scenarios, for instance on factory floors or at hotel front desks.”  Truly an entrepreneur, Tony worked from home, had no employees, and created contracts with companies that needed products designed for them and then contracted out to a team of engineers and a manufacturer that shipped the product directly to the end user.

Sam Jaffe: Thoughts on the Cleantech Fellows Institute

Sam Jaffe is one of the Cleantech Fellows Institute’s invaluable Department Heads, leading the Storage Technologies curriculum. We asked Sam to share his thoughts about the program.

Your background is in journalism with publications such as Bloomberg and Business Week.   What brought you into the cleantech arena?

I went into journalism because it’s a great way to witness history. However, in the end, your role as a journalist is as an observer, not as a prime mover of change. I went into cleantech because I felt that making energy clean and cheap is the fundamental challenge of my generation and I wanted to be part of it–as an actor, not as an observer.

You’ve worked with some of the premier energy and cleantech research firms.  Has your research and work with these firms led you to have any industry “ah-ha” moments that you can share?

As a science journalist, I was always interviewing fascinating people who made significant discoveries. But when I asked them when their breakthrough would be turned into a product, the answer was always the same: “In five years.” I wanted to find out what was so magical about five years. The “ah-ha” moments have usually been when I’ve had a chance to peek inside the screen and find out that “five years” is usually short-hand for “this will never work, but we’re going to milk it for as much capital and prestige as we can for as long as we can”. When a concept described in a scientific paper really, really works and solves a significant business problem, it usually finds its way to market much earlier than five years. The majority of cleantech concepts out there, however, simply don’t work as promised. There might be published data and a team of people with great C.V.’s, but the data is usually wrong.

An Interview with Steve Berens, Cleantech Fellows Department Head

Steve Berens is one of the Cleantech Fellows Institute’s invaluable Department Heads, leading the Capstone Project team. We asked Steve to share his thoughts about the program. 

You know the startup and entrepreneur environment very well.  How do you feel about the cleantech startup market given today’s economic pressures?

I'm excited by the amount and variety of unique, market-worthy opportunities currently being considered as part of the cleantech fellows program. I believe the contributing institutions, up-and-down Colorado's front range, have exciting and innovative technologies that can make economic and social impact. Today's economic realities require that each of the Fellows’ technologies be evaluated on their own merits. The Fellows are approaching these opportunities by looking intently at the feasibility of projects that survive without government or grant funding and deliver strong ROI to their customers.

What drew you to the Cleantech Fellows Institute?

I was initially drawn to the Cleantech Fellows Institute by the passion and capability of the founding team. Their commitment and dedication to bringing a strong program to Colorado was evident. I am continuously impressed by their ability to bring a wide variety of clean technologies and real opportunities to Fellows who want to join or expand the cleantech industry in Colorado.  It is exciting to see the progress in the unique opportunities that are being pursued.  It has been an honor to be a part of the team. 

Focus on the Fellows: Henry Mouton

With over half of the Cleantech Fellows Institute curriculum completed, we wanted to take this opportunity to highlight the Fellows and the progress they have made to date.  This first installment of our Focus on the Fellows looks at Henry Mouton, a successful Fort Collins businessman with 26 years of experience in the restaurant industry and a deep passion for sustainability. 

On track for an engineering career in the oil industry, Henry took a class his senior year called “Ethics of Engineering.”  This class illuminated the challenges between the oil companies and the environment and came to be the catalyst in his shift of focus away from traditional energy development and towards environmental stewardship.  The second career-altering event came soon after he graduated, with an invitation from his older twin brothers to move to Colorado to ski for a season and help out at their newly founded Rio Grande Mexican Restaurant.  Whether it was the great snow or the Rio’s impressive success, Henry stayed longer than a year, 26 to be precise, becoming the Chief Operating Officer and Director of Sustainability while the Rio grew to 8 locations, employing 575 Coloradans at its peak.  Having recently retired from the Rio, Henry notes only one regret - that he would have devoted even more of his efforts towards corporate sustainability earlier in his career.

The experienced restaurant businessman is now returning to technology, specifically to cleantech.  In this industry, he believes that determination is the key attribute for an individual to succeed and his environmental emphasis is Henry’s main motivator.  “For me, reducing my carbon footprint is critical, so I think that’s the biggest driver for me.  I think that can be my biggest contribution.”  Since being in the Cleantech Fellows Institute program, he views energy efficiency and building technologies as the most promising area in cleantech, short-term, because many of our buildings are at the age where retrofits are needed, regardless of whether clean technologies are integrated or not.  He cites notable examples such as the Empire State Building retrofit, and locally, the Byron Rogers Federal Building retrofit, which the Fellows Institute toured in late October.  In these cases, developers were able to take advantage of new financing strategies and better ROI’s to make energy efficiency plays attractive and economical.  Energy efficiency can also be increased by behavioral modifications, which companies such as Green Button and Tendril emphasize.  

Henry believes the nation is moving in the right direction in terms of accepting cleantech, but wishes the industry wasn’t labeled as a high-risk venture for investors.  He says, “The way I see it is, if it’s a great idea and if you have the right people at the table, then you’re going to end up with a successful company.  So whether it’s cleantech or not, the basic tenets apply.”

Ampt Creates Solar Energy Leadership Alliance to Improve Solar Energy Economics

At the recent Solar Power International Trade Show last September, Ampt Solar, a Fort Collins-base company, had several significant partnership announcements. Most significant was the launch of an industry alliance to drive down cost of solar: http://www.ampt.com/pressreleases/HDPV_Alliance-20120910.pdf

Ampt has patented technology that enables an inverter to deliver up to twice the power at a higher efficiency than the same inverter operating in a normal mode. Doubling the rated power is equivalent to cutting the cost in cents per watt in half. Ampt’s technology also enables systems to be designed with more PV modules in a series string to save up to fifty percent on DC BOS costs. These savings collectively represent Billions of $s each year that can be eliminated from the cost of PV solar. 

Ampt Converter

"We recognized that our technology is disruptive, but also that it enabled innovation in many areas of the PV system from inverters to PV modules to system design and operation. The opportunity for disruptive cost reduction was bigger than just Ampt, and so we looked for partnerships with other innovators in the industry," said Ampt CEO Levent Gun. "HDPV, or High Definition PV, creates the highest ROI, derived from increased performance and lower cost of PV systems. Better project economics makes financing available to more projects, and removes the most limiting bottleneck for the rapid growth of solar market. This accelerates market growth.  That is the opportunity of HDPV, and, we hope, part of our legacy for the future."

Within the HDPV Alliance, manufacturers of inverters, junction boxes and solar modules as well as monitoring companies will have access to Ampt's technology. As Ampt becomes an integral part of the system architecture, solar developers drive down costs system wide.

The HDPV Alliance generated quite a bit of buzz at the show, with news stories from Green Tech Media and others:http://www.greentechmedia.com/articles/read/Is-Ampts-HD-PV-Alliance-an-Answer-to-Lower-Solar-Costs/

A website and more information about the program is pending. For details about current partners and the alliance, visit http://www.ampt.com/

2012 Colorado Cleantech Awards Celebrates Advancements in Colorado’s Cleantech Community

Keynote Speaker Josh Green

This Monday, we honored those endeavors of Colorado's cleantech community during our Colorado Cleantech Leadership Awards Celebration. Throughout the evening, we honored 14 recipients for their efforts in advancing Colorado’s cleantech ecosystem, increasing jobs and driving innovation in the cleantech sector.

Innovation was a theme for the night, as Josh Green, General Partner of Mohr Davidow Ventures, presented his compelling keynote on the importance of clean technology today and forward. 

“Innovation will always prevail,” said Green during his keynote. Green “Although cleantech has struggled in the past and will surely see bumps along the road as we move forward, the take away point from this year’s event is that Cleantech has a strong and viable future. If we place value in those whose leadership and technology is continuing to impact cleantech in new and exciting ways, then surely we cannot fail.” 

Please join us in congratulating all of CCIA’s Leadership in Advancing Cleantech Award winner:

National Cleantech Leadership: 

Center for the New Energy Economy

Founded in February of 2011, the Center for the New Energy Economy is a privately-funded initiative to support the growth of a cleantech economy across the United States. The Center, a part of Colorado State University, is led by former Colorado Governor Bill Ritter and is assisted by some of the nation’s most important thought leaders in clean energy research, development and commercialization. 

Governor’s Award For Excellence in Cleantech Leadership: 

Robert Fenwick-Smith

Robert Fenwick-Smith founded Aravaipa, an efficiency-tech investment fund in Colorado, in early 2008. With 20 years of global experience acquiring, founding, building, merging and selling companies, Robert is frequently invited to serve on cleantech investing panels and juries. 

Cleantech Corporate Champion: 

Wells Fargo

Wells Fargo offers customized commercial banking products and services to businesses that manufacture, market or develop clean technology products and services. It is with their generous support that programs such as the Cleantech Open, CU Cleantech, NREL Industry Growth Forum, and Cleantech Fellows Institute that cleantech ventures in Colorado can sustain funding.

Investor of the Year: 

9th Street Investments

9th Street is a non-traditional venture capital group born out of CoorsTek, Inc, headquartered in Golden. 9th Street primarily focuses on businesses in the advanced materials sector and has invested in Boulder Ionics, ALeco Container and more.

High Impact Cleantech Company of the Year: 

Albeo Technologies 

Based in Boulder, Colo., Albeo designs and manufactures highly efficient LED lighting solutions focusing on the commercial and industrial sectors. Albeo’s primary goal is to enable businesses to simultaneously lower their total operating costs and help the environment. 

Breakout Cleantech Company of the Year: 

Boulder Wind Power

Boulder Wind Power creates utility-scale permanent magnet generator technology that will dramatically reduce the production cost of wind energy. The company works with wind turbine manufacturers to deliver simpler, more efficient and cost-effective ways to maintain systems than existing wind turbine technologies.

Emerging Cleantech Company of the Year: 

SkyFuel Inc.

SkyFuel, Inc. is a solar thermal power technology and service provider founded in 2007. SkyFuel solar collectors harness solar radiation to produce steam for electricity generation and industrial applications. The company is a leading supplier of utility-scale concentrating solar power (CSP) systems. 

Colorado Cleantech Entrepreneur of the Year: 

Hans Mueller, EcoVapor Recovery Systems

Mueller is the founder of EcoVapor Recovery Systems, a state-of-the-art recovery technology for oil and gas wells. He has established an industry-leading economic return technology that also addresses increased environmental regulations.

Colorado Cleantech Executive of the Year: 

Mark Verheyen, TerraLUX

Mark Verheyen joined the TerraLUX team in 2011 with extensive experience in the illumination market and a proven track record penetrating and expanding new growth markets across Asia/China, South America, North America, and Europe. Mark has more than 20 years of sales and senior management experience. 

Political Advocate of the Year: 

State Representative Brian DelGrosso 

Brian DelGrosso is a member of the Colorado General Assembly representing the Loveland area. Brian is a successful small business owner and a pragmatic legislator with a reputation for common sense solutions to grow Colorado’s economy.  Additionally, this year he was the sponsor of a bill signed into law to cut red tape to make it easier to expand alternative fuel vehicle infrastructure. 

Excellence in Commercialization:

Colorado State University - Dr. Eugene Chen

University of Colorado - Dr. Ryan Gill

National Renewable Energy Laboratory - Dr. Charles Teplin

Colorado School of Mines - Dr. P. Craig Taylor

Did you attend the dinner? What did you learn from the speakers and award winners?

CCIA selects the 2012 Finalists for the Colorado Cleantech Industry Awards Celebration

The Colorado Cleantech Industry Association today released the names of the finalists for this year’s 2012 inaugural Colorado Cleantech Industry Awards Celebration. The finalists were selected based on their leadership in advancing cleantech job creation, corporate growth, individual effort and technical innovation.

Winners will be announced Monday, Oct. 22 at the Sheraton Downtown Denver hotel, at the official event.

The 2012 Colorado Cleantech Leadership Awards Finalists are:

NATIONAL CLEANTECH LEADERSHIP AWARD 2012
Center for the New Energy Economy (Fort Collins) - http://cnee.colostate.edu/index.html
Colorado Renewable Energy Collaboratory (Golden) - http://www.coloradocollaboratory.org/
Ecotech Institute (Aurora) - http://www.ecotechinstitute.com/

GOVERNOR’S AWARD FOR EXCELLENCE IN CLEANTECH LEADERSHIP 2012
Robert Fenwick-Smith, Aravaipa Ventures - http://www.aravaipaventures.com/
Doug Schatz, Ampt - http://www.ampt.com/
 
CLEANTECH CORPORATE CHAMPION 2012
Wells Fargo - http://www.wellsfargo.com/ 

CLEANTECH INVESTOR OF THE YEAR
9th Street Investments (Golden) - http://9thstreetinvestments.com/
Access Venture Partners (Westminster) - http://www.accessventurepartners.com/content/
Braemar Energy Ventures - http://www.braemarenergy.com/ 
New Enterprise Associates - http://www.nea.com/ 

HIGH IMPACT CLEANTECH COMPANY 2012
Albeo Technologies (Boulder) - http://www.albeotech.com/ 
Sundrop Fuels (Longmont) - http://www.sundropfuels.com/ 

BREAKOUT CLEANTECH COMPANY 2012
Boulder Wind Power (Boulder) - http://www.boulderwindpower.com/
Zeachem (Lakewood) - http://www.zeachem.com/

EMERGING CLEANTECH COMPANY 2012
Silver Bullet Water Treatment (Denver) - http://silverbulletcorp.com/
SkyFuel Inc. (Arvada) - http://www.skyfuel.com/

COLORADO CLEANTECH ENTREPRENEUR OF THE YEAR
Sandy Butterfield, Boulder Wind Power (Boulder)- http://www.boulderwindpower.com/
Hans Mueller, EcoVapor Recovery Systems (Centennial)- http://www.cleanlaunch.com/

CLEANTECH EXECUTIVE OF THE YEAR
Joel Butler, Solix BioSystems (Fort Collins) - http://www.solixbiofuels.com/
Mark Verheyen, TerraLUX - http://www.terralux.com/ 

LEGISLATOR OF THE YEAR
State Representative Brian Delgrosso - http://www.briandelgrosso.com/ 

Only One Week to Register for the 2012 Presidential Surrogate Debate

Being that Colorado is a swing state with a robust renewable and traditional energy sector, the spotlight has been placed on Colorado during this important election. Colorado’s strong role in energy research and its national spot as a top 10 state for wind, solar, coal, oil and gas resources and deployment make it an excellent forerunner for national energy issues.

Former Secretary of Energy Federico Peña and former Governor Bill Owens will officially represent President Obama and Governor Romney campaigns during the highly anticipated 2012 Presidential Energy Surrogate Debate. They go head-to-head discussing the state of energy in this important election. Eli Stokels of FOX 31 will moderate the debate.

The event is next Tuesday. Join the Colorado Cleantech Industry Association, along with the Denver Metro Chamber of Commerce, the Colorado Petroleum Association, the Colorado Oil & Gas Association (COGA) and the Environmental Entrepreneurs (E2), as we embark on the hotly debated topic of the future of our nation’s energy sector.

Join us Oct. 9 at the University of Denver (Auraria Campus) Tivoli Turnhalle from 8 a.m. to 9:30 a.m.  This event is $35 for sponsor members and $45 for non-members.  Take charge in the outlook of our nation’s energy sector and register now.

Nominations for Cleantech Industry Awards Due Friday

There are only a three days left to nominate your choice for this year's cleantech leadership awards! Nominate a company or entrepreneur to receive a Colorado Cleantech Industry Award. Finalists and winners will be selected by the CCIA Awards Committee to receive recognition in the following categories:

• High Impact Cleantech Company of the Year
• Breakout Cleantech Company of the Year
• Emerging Cleantech Company of the Year
• Colorado Cleantech Entreprenuer of the Year
• National Cleantech Leader

Winners will be announced at the Colorado Cleantech Awards Celebration on Oct. 22. All of the details about the application process can be found about the application process by visiting the link above. Our thanks to Deloitte for partnering with us to manage the award process.

Colorado Cleantech Awards Sponsorship Deadline Tomorrow

It’s not too late to claim your event sponsorship at this year’s third annual Colorado Cleantech Awards Celebration! As we inch closer to the end of the September, we head towards celebrating this year’s cleantech leaders and their companies for their efforts to expand Colorado’s cleantech ecosystem, increase jobs and build one of the best states in the nation for the cleantech industry.

Help us celebrate the life of Colorado Cleantech by becoming a sponsor for our 2013 Awards Ceremony. Event sponsorships provide a two-fold benefit for your company. Not only do most sponsorships include advertising in Colorado Biz’s Cleantech Special Section, but they also show your support for the cleantech industry.  Your logo will be placed throughout the event website, in the handouts during the event, emails prior to the event, newsletters, print/radio media mentions, social media outreach and more. Join the ranks of those who have already committed to sponsoring the event, including Cooley, the National Renewable Energy Laboratory (NREL), KPMG, OPX Biotechnologies, Rothergerber Johnson & Lyons, LLP, Cenergy, CSU Ventures and more.

The deadline for sponsorship is tomorrow. For more information please contact us at info@coloradocleantech.com or visit the Colorado Cleantech Awards sponsorship page: coloradocleantech.com/2012-dinner.html. Don’t wait until the last minute, reach out to our representative today and see how your company can participate in this amazing cleantech celebration.

Josh Green to Keynote Cleantech Industry Awards

Josh Green will address raising capital in tight markets and the necessity of innovation at the upcoming Colorado Cleantech Industry Awards Celebration Oct. 22 at the Sheridan in downtown Denver. 

Green is a venture capitalist and general partner with Silicon Valley firm Mohr Davidow Ventures. His keynote presentation is titled, “Toward an Optimistic Cleantech Future.” 

In a 25-year career, Green has acted as advisor to some of Silicon Valley’s legendary startups in the computer, Internet, telecommunications, biotech and medical device industries. His breadth of knowledge makes him uniquely qualified for cleantech, which spans multiple industries. 

“While some within the industry may feel beaten down at the moment, there is still a need for innovation in the creation, distribution and use of energy. Innovation is going to find its way,” Green said in a recent news release from CCIA. “History shows us that it is during the challenging points in the cycle where brilliant, fundamental technology breakthroughs happen.” 

With the challenges the industry has faced in the past year, Green's speech about how to gain industry strength through innovation is sure to draw attention.

Tickets and sponsorship information for the Colorado Cleantech Industry Awards Celebration 2012 are now available. Nominations are being accepted until Sept. 28 for companies and entrepreneurs making a difference in Colorado’s cleantech economy. For more information, visit CCIA's website.

So what is this crowdfunding, anyway?

New legislation by Obama and Congress relaxes solicitation by start-ups

By Jim Brendel

Originally published in Accounting Today

The trendy new term in the high tech arena is “crowdfunding.” Both the President and Congress jumped on the crowdfunding bandwagon as a way to show they are doing something about the economy by passing the JOBS Act. What exactly is crowdfunding? Here’s one introduction through the eyes of a professional accountant and auditor.

Essentially, crowdfunding is the ability for a large group of people to band together and make small investments that collectively are enough to fund a start-up company. Prior to the act, that wasn’t feasible because the limit on the number of shareholders before having to report as a public company was 500. The legislation raises that to 2,000. Naturally, this will be done over the internet, through what the legislation terms “funding portals.”

It’s a hot topic for businesses because they are always looking to raise capital. The hard part is figuring out a way to get investors together. Without some kind of exchange, only tech savvy companies that had a web-based business could raise money that way. Now several funding portal websites have risen to fill the crowdfunding void. Anyone, even if not incorporated, will be able to use crowdfunding. It is only limited by the attractiveness of your idea and ability to present it.  

Kickstarter, CircleUp and Fundable

The remarkable thing about crowdfunding is how successful it’s been even though the SEC hasn’t created rules for it; they are not due until the end of 2012. The appetite for small investments in companies is proven by the report that the website Kickstarter has raised more than $200 million for 22,000 product offerings. Two million people have supported these products, receiving nothing more than what amounts to a digital “attaboy” and maybe a sample of the product.  Investors are termed “supporters” because they don’t currently receive any ownership in or financial information about the retail product start-ups.  In April, the SEC reminded issuers that “any offers or sales of securities purporting to rely on the crowdfunding exemption would be unlawful under the federal securities laws.”

Kickstarter started all this three years ago.  Co-founder Yancey Stricker was quoted as saying that only five percent of the projects appealing for funding are rejected, while 56 percent of them fail to meet their fundraising goals. Film fundings are the most successful projects on the site, with 12 Kickstarter films showing in the Tribeca Film Festival this year. Company officials say they won’t switch to equity shares, even when the SEC rules are out.

Here’s a typical reward for supporters of ReAct Theater in Seattle: For $10, you get an admission to a play in the theater; for only $30, you receive invitations to cast events and backstage passes; for $250, you can have dinner with the theater’s board and for $1,000 or more get a special VIP night with a pre-show dinner, front row seats and drinks after with cast members.

CircleUp, on the other hand, offers direct share ownership in consumer product start-ups in return for your financial support. According to the company’s website, “Your ownership will be proportional to the amount you invest. As the company grows, so will your equity investment. This ownership will allow you to receive distributions when the business is sold or if dividends are paid.” The site does not offer a rewards model. CircleUp is able to offer equity because they currently only accept “accredited investors,” who must have $200,000 of annual income or $1 million in net worth.

Fundable attempts a combination of both methods. The company said that it will – as required by the new law – register with the SEC and a yet-to-be decided self-regulatory body as a broker-dealer before it can sell shares of companies. CircleUp will have to do the same in order to offer shares to the public. Fundable charges companies 5 percent of every dollar raised. One of its successful products was an elevation training mask that simulates training at elevation for runners and cyclists. The product goal was to raise $10,000 and it had raised $14,000 a month before its deadline. The most popular “reward” level was $75. For that you got a mask, a beanie and a t-shirt.

To the trained eye, there are some obvious challenges to crowdfunding. The first and most obvious is the probability that it could be used for fraudulent activity. The second is that even if investors receive actual shares of the company once the SEC rules are set, these shares are private and illiquid, meaning that once you’ve bought them there’s little chance that you will be able to sell them to someone else. The crowdfunding sites are not exchanges, just angel investment collectors. The third is that there are few requirements – if any – to inform investors about what’s happening with the company.  SEC chairwoman Mary Schapiro has already said that the JOBS Act would weaken investor protection.

SEC attorney John Eckstein of Fairfield & Woods in Denver notes that crowdfunded shares per the JOBS Act are to be sold in a transaction which is exempt from registration under the 1933 Act (new Section 4(a)(6)).

“We are all assuming that the shares once they have come to rest in the hands of an investor will be 'restricted' stock which cannot be resold unless they are subsequently registered under the 1934 Act or exempt (e.g. Rule 144 or "Section 4(a)(1 1/2)" type transactions,” Eckstein says. “The SEC has a lot of regulation writing to do to make the rules for this new exemption clear and facile for the use by issuers, intermediaries, investors, and service providers such as accountants and lawyers. Many things are yet to be determined.”

Eckstein says there is a political battle for the right to be the self-regulatory agency over portals.

“FINRA (Financial Industry Regulatory Authority) would certainly like the job, but there is at least one new portal trade association (Crowdfund Intermediary Regulatory Association) trying to form to do the job. My bet is on FINRA, which is also trying to get the job of regulating registered investment advisers after Dodd-Frank, but there are reasons why FINRA may not be the best public policy choice,” Eckstein says.

Crowdfunded companies that raise more than $1 million during one 12-month period or have more than 500 shareholders will have to register as public companies and begin public reporting. Until then, these new looser regulations will no doubt allow some winning companies to emerge. They will probably be in the minority however, as some real stinkers emerge a year or two after they receive funding. Of course, that’s the nature of venture investing.

About the author

James Brendel, CPA, CFE, is the national director of audit and accounting for Hein & Associates LLP, a full-service public accounting and advisory firm with offices in Denver, Houston, Dallas and Orange County. He specializes in SEC reporting and assists companies with public offerings and complex accounting issues. Brendel can be reached at jbrendel@heincpa.com or 303.298.9600.

Why Disillusionment with Cleantech is Not Such a Bad Thing

By Christine Shapard, Executive Director, Colorado Cleantech Industry Association

These days, some major proponents of cleantech are having a hard time staying optimistic about the future of the industry. With continuing news of layoffs at major companies like Vestas and closures of some businesses, like Abound Solar, it’s easy to think that cleantech may not become an economic engine within the next decade.

But if history proves us correct, cleantech will only flourish in the next few years because of the dedication of a few. Sometimes, the biggest things happen after the parade has passed.

Have you ever heard of the Hype Cycle? Coined by Gartner, Inc, a hype cycle is a graphic representation of the maturity, adoption and social application of specific technologies. A hype cycle is a good representation of how nascent technology industries grow, from the breakthrough Trigger Point, to Irrational Exuberance, through the Trough of Disillusionment, up the Slope of Enlightenment and landing on the Plateau of Productivity. Hype cycles can be applied to almost all new technology industries including smart phones, internet sales, and search engines, to name a few.

What about cleantech? A nascent industry if there ever was one. Yes, the Gartner Hype Cycle applies to cleantech, as well. So where are we? About five years ago, some in the cleantech ecosystem were in the irrational exuberance state and witnessed high valuations along with high levels of venture dollars flowing into the industry. Today? That’s a tricky question for the cleantech industry. Because cleantech encompasses such a wide variety of technologies, we find our companies at various points in the cycle. 

Of particular concern of late are the companies mired in the trough of disillusionment. A few of the early high flyers have exited the market due to economic contraction, global competition, poor planning or a myriad of other reasons. In turn, some venture capital has pulled away from early stage investing because they were burned at the beginning, which is not good for the current start-up community. The good news is, the market is correcting itself and companies should begin entering the slope of enlightenment. Gartner points to the slope as the point at which enterprises start to recognize how the technologies can benefit their businesses. More instances of how the technology can benefit the enterprise start to crystallize and become more widely understood. Second- and third-generation products appear from technology providers. 

Colorado’s cleantech community continues to innovate, regardless of the national political rhetoric and the headwinds against them at the moment. I am confident that once we move beyond being mired in this negative cycle, the industry’s well-led companies and viable technologies will see an influx of capital and sustained growth. 

No Water, No Energy. No Energy, No Water

By William Sarni, Director and Practice Leader Enterprise Water Strategy

Deloitte Consulting LLP

Energy has long been considered an engine of economic growth and the world needs more of it. The U.S. Energy Information Administration (EIA) estimates that world energy demand will increase by 53 percent between 2008 and 2035. EIA further predicts that a large portion of this demand will be met through low-carbon, renewable forms of energy, but a vast majority of it will still satisfy traditional fossil fuels.

The connection between energy and freshwater has long been established, but few companies have plans for management. With growing instances of drought and flooding and increasing incidences of water scarcity, more public and private sectors are seeing freshwater for what it is: a scarce and precious commodity that needs to be managed more effectively.

It takes vast amounts of water to extract, process and produce many forms of energy and it takes vast amounts of energy to extract, transport and treat water. The demand for one could soon cripple our need for the other. When added to competing pressures of food requirements, these concerns multiply. The availability of both energy and water impacts our ability to adequately supply food to an expanding global population.

Unless we can manage energy and water, we will not likely be in a position to feed an increasingly hungry world. The competition for energy, freshwater and food raise serious concerns about economic development, national security and public well-being.

The Path Forward: New Technologies Needed to Reduce Energy’s Water Footprint

The solutions provider market is forecast to grow as new technologies are needed to address the water gap. From an energy perspective, the solution involves reducing water consumption in traditional energy production as well as moving towards energy sources that are inherently less water-intensive. Where do we go from here? We have outlined below top actions for water stewardship, as well as energy and power:

Managing the Nexus

Water Stewardship - Top Three Actions

•       Track water use against energy use -- how much water is associated with direct energy use (onsite), purchased energy and in your supply chain?

•       Develop an understanding of your water footprint and water risk within the watershed.

•       Engage stakeholders within the watershed to develop a collective water and energy conservation and management plan.

Energy and Power - Top Three Actions

•       View energy development (oil and gas, biofuels, etc.) as power generation within the context of the local watershed, i.e., “watershed-scale thinking.”

•       Consider renewables (low water footprint) for watersheds experiencing water stress or scarcity.

•       Engage stakeholders within the watershed to develop a collective water and energy conservation and management plan.

Embracing new economic and business models means meeting the needs of the water-energy nexus by leveraging new technologies.

William Sarni is a Director of Deloitte Consulting LLP and is the firm’s Practice Leader for Enterprise Water Strategy. An internationally recognized thought leader on sustainability and corporate water strategies, Sarni is a frequent speaker for corporations, conferences and universities. He is the author of “Corporate Water Strategies” and the forthcoming book, “Water Tech, A Guide to Investment, Innovation and Business Opportunities.” He lives in Denver.

As used in this document, “Deloitte” means Deloitte LLP and its subsidiaries. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.

Normalize Renewable Energy Credits Now

Authors: Greg Pfahl, CPA, Hein & Associates, LLP and Sean Kelly, CPA, Hein & Associates, LLP 

Several renewable energy incentives are on the congressional chopping block this year, and every year, it seems. There are plenty of persuasive arguments on either side regarding whether or not to keep renewable incentives. We believe a long-term energy policy is needed at the federal level to allow the domestic renewable energy industry to grow and ultimately prosper. It will remove the guesswork surrounding what incentives may be available in any given year. 

 

First, let’s offer some perspective. The government gets involved with industry when it deems it is in the national interest of the U.S. For example, companies and investors receive tax advantages associated with domestic oil production as a way to lessen U.S. dependence on foreign oil. Earlier in our history, the government granted right-of-ways to railroads and utilities. Today, politicians use the renewable energy industry as campaign stump fodder because clean, domestic renewable energy sounds good to voters. It brings in jobs arguments as well, and Navigant Consulting, Inc. estimates that eliminating the production tax credit on wind would blow away 37,000 jobs in the U.S.

When a group submits a business plan for potential funding, it often includes projections 10 years out. How can renewable energy companies receive funding when a critical aspect of their business plans — those dealing with such issues as investment tax credits and bonus depreciation, for example — is indeterminate? The 2.2 cent per kWh tax credit program has been extended seven times during the past 10 years.  Banks and investors want to know what the potential financial landscape is with the best amount of assurance, and annual extensions of incentive programs by Congress is the last place they look.

A Change Is Coming

For many, having success in one industry might be enough. However, we know there are those out there that have found that success and are now ready to trail blaze onto a new and exciting venture. Perhaps a venture in cleantech.

As the application process for the inaugural year of the Cleantech Fellows Institute draws to a close, the gears of this program are already turning.

Just take a peek at some of the curriculum for the Institute:

• Clean Energy Generation – solar, wind, hydro, biochemicals, natural gas, biofuels
• Storage Technologies – grid storage, ultracapacitors, fuel cells, batteries
• Advanced Transportation Technologies – electric and hybrid technologies, advanced engines, materials, biofuels
• Energy Efficiency and Building Technologies – lighting and HVAC, building automation, energy management systems, demand response and green buildings
• Foundational Elements – tech transfer, commercialization, national infrastructure, cleantech financing, regulatory, public policy

For those still looking to find out more information you can contact CFI for answers, additional details and  press inquiries.

Beetle Kill and Biomass Projects

About 3 million acres of Colorado and Southern Wyoming forests have been killed by the Rocky Mountain pine beetle, which has infested the Colorado’s Lodgepole Pine population for the past 15 years. The beetle kill epidemic is visible all over the state and has turned much of Colorado’s wilderness from lush green to a dark reddish color, which is severely noticeable in most regions. 

The outbreak has become an increasingly pressing problem, as the beetle populations have sustained themselves and moved upwards in elevation due to the past few relatively warm winters, and also have developed more expansive eating habits. The Forest Service has worked to clear some of the dead forests in efforts to prevent further spread of beetle populations. The vast areas of dead trees also present growing concerns regarding forest fire danger, watershed damage, trail and road damage, and power line damage.

Growing operations to remove the dead trees throughout Colorado’s forests means an increase in timber supply, which needs a use. Using the dead trees for lumber and commodity type products is difficult, as the trees killed by beetles loose their saw log value in less than two years. The beetles also leave the trees with a blue stain caused by a fungus and this reduces the market value of the wood. 

Biomass projects have become an increasingly viable and logical option for making use of the beetle kill trees, as clearing dead forests becomes a priority for the Forest Service. Although there are concerns about the environmental impact from extracting the trees from the forest, it is imperative that measures be taken to appropriately manage Colorado’s forests in order to prevent forest fires resulting in damaged watersheds.

Colorado has passed a list of bills in the past couple years that have created incentives for biomass projects in the state.

More from Elle Carberry of the CGTI

One of two co-founders and one of three managing directors of the China Greentech Initiative, Elle Carberry, resides in China to truly keep her finger on the ever changing pulse of country's greentech industry.

Elle weighs in with us on everything from the speculative talk of an economic hard landing in China to their aggressive and successful efforts at creating a Strong and Smart Grid Plan.

As rumors and speculations swirl about the possibility of China experiencing a hard landing, how could that affect the country's efforts and ambitions in the greentech industry? It's a question that has been looming for months. 

"Generally from '09 to now China has been trying to stimulate domestic consumption – and China knew it had to do that—it knows it has to do that—there’s no choice about it—its what you do. Their average GDP per person is growing all the time. China has an emerging middle class where their incomes are going up 10 and 15 percent year over year, so it’s tangible. People have money but people need to spend money and they need to spend it in their own domestic economy," Carberry said.

For China, one of the answers has been to move forward with greentech initiatives. Despite setbacks, maintaining and increasing greentech targets is essential.

"The solar industry in particular has been through a bit of a hit, so they immediately increased the targets for how much solar and wind power it wants to produce in this current five year plan," said Carberry. "It’s already been making adjustments directly through the mandate that says the country will install this many gigawatts of wind and solar and biofuels, that’s the kind of thing that they will continue to do." 

One of China's particularly interesting greentech initiatives is Waste to Energy (WtE) efforts. WtE refers to taking any biofuel/waste and finding ways to harness it for a growing population's energy consumption needs. 

The China Greentech Initiative

The China Greentech Initiative (CGTI) is an organization devoted to connecting cleantech markets in China with international technology buyers and sellers, service providers, investors and policy makers. The initiative serves as a key bridge between U.S. cleantech markets and those in China, as CGTI provides its partners with valuable advice and services as they look to expand into Chinese markets. CGTI offers a Partner Program as well as Partner-specific Advisory Services, providing their clients with valuable insight into emerging market opportunities. The initiative works to connect U.S. and Chinese industry experts, fostering working business relationships, and provides valuable information on China’s greentech markets through their China Greentech Report.

On Wednesday June 20^th the China Greentech Initiative put on a panel discussion lead by CGTI’s co founder and Managing Director, Ellen Carberry. The event served as a valuable introduction between U.S. cleantech firms and the CGTI and also provided insight into China’s growing greentech industry and need for clean energy technologies. Ellen and her colleagues have decades of experience working with technology industries in both China and the U.S. and serve as a valuable link for U.S. clean technology experts who want to expand into China’s greentech markets.

Growing public engagement on environmental issues in China along with improved greentech polices has driven the nation to grow its cleantech markets and partner with foreign experts in the sector. Bringing U.S. based technologies into Chinese market can be difficult and intimidating for foreign technology providers. CGTI however, has developed close relationships with companies, service providers and policy makers in both China and the U.S., and partnership with the initiative helps to ease this process and foster strong working relationships. The initiative is also key in educating its clients on government policies and helping to create working relationships between the two parties as U.S. technology providers look to expand into foreign markets. CGTI offers services in a wide range of cleantech sectors in China including cleaner conventional energy, renewable energy, electric power infrastructure, green building, cleaner transportation, clean water, and waste management. CGTI partnership programs offer a platform that provides more successful industry connections and advice than any one company can.

Visit China Greentech Initiative’s website: www.china-greentech.com

Post Author: Halsey Landon, CCIA Public Policy and Special Projects Intern

Chris Shapard Speaks at Clinton Global Initiative

 Last week, Colorado Cleantech Industry Association Executive Director Chris Shapard spoke on a panel at the Clinton Global Initiative. This annual event focuses on finding solutions that promote economic recovery in the United States.

Chris spoke on a panel focused on “Place-Based Innovation: Creating Centers of Prosperity.” She joined John Sibley Butler from The University of Texas at Austin; Ann Miura-Ko, managing partner at FLOODGATE; and San Diego Mayor Jerry Sanders to discuss developing technology clusters that foster economic growth and innovation. The panel was moderated by Maria Bartiromo, an anchor at CNBC.

As the only cleantech industry executive on the panel, Chris brought a unique perspective to the group, talking about the need for a national energy policy and creating successful innovation centers by focusing on the industry needs.

“With my background in economic development, I find that when an organization is developed by the industry to have common goals and define similar objectives, it is easier and more sustainable to grow,” Chris said. “The industry is focused on being profitable and a way to create a profitable technology cluster is to foster workforce readiness.”

Chris pointed to the creation of the Cleantech Fellows Institute as one way Colorado is working to get the workforce ready for job development. The Cleantech Fellows Institute works with executives from other industries to teach them about the cleantech industry so that they have the tools to start their own venture-back cleantech business.

The panel focused on how partnerships formed with local organizations, like the one CCIA has with the Department of Energy’s (DOE) National Renewable Energy Laboratory (NREL), creates an effective ecosystem that fosters the connection necessary to spur innovation, grow businesses and create jobs. A supportive environment also includes available financing, a community of peer businesses, a skilled workforce and market access.

To watch the entire panel, visit the CGI website: http://new.livestream.com/accounts/376536/CGIAmerica2012/videos/1370528

CCIA's 2012 Legislative Session Wrap-up

2012 was another successful session at the State Legislature for CCIA.  In addition to passing our bill, we successfully weighed in on a variety of bills on behalf of the cleantech industry in Colorado.

On May 3, Governor Hickenlooper signed our bill, HB 1258 – Alternative Fuel Vehicle Charging Stations, into law.  CCIA would like to thank our bill sponsors Rep. Brian DelGrosso (R-Loveland) and Sen. Cheri Jahn (D – Wheat Ridge) for their leadership on this important issue.  CCIA would also like to thank the many stakeholders who helped pass this legislation.  

HB 1258 clarifies that if a business places an electric vehicle charging station or natural gas fueling station on their property and offers this to their customers, they are not regulated by the PUC.  This places natural gas and electricity for alternative fuel vehicles on par with gasoline and diesel in the marketplace.  In addition, the bill clarifies that if a business has renewable energy on their property and also an electric vehicle charging station they will not be regulated by the PUC.

This session CCIA also weighed in on several bills in various committees including the two listed below signed into law by the Governor:

• HB 1312 – Clarifies and streamlines local government and PUC jurisdiction for new transmission relating to Certificates of Public Convenience & Necessity;

• HB 1315 – Reorganization & Funding for the Governor’s Energy Office. This bill changes the department’s name to the Colorado Energy Office, fully funds the office and breaks it into two divisions: 1) Renewable Energy Fund; and 2) Innovative (Traditional) Energy Fund.  This bill will allow the office to maintain current staffing levels and existing programs while also focusing on innovation with traditional energy in Colorado.

NYC to test drive EV cabs

In recent years, we've seen new technology competitors throw down the gauntlet in order to get a stronghold on their market. We saw it with HD DVD and Blu-Ray, and now we're seeing it with electric vehicles. 

NYC is about to launch a pilot program during 2012 where six Nissan Leaf EVs will begin operating in the city as taxis. In October 2013, Nissan's gas-engine NV200 will begin its reign as New York's new go-to taxi. 

However, the Nissan Leaf has some competition to surpass in order to nab the coveted spot as the EV cab of the future. First, the Leaf, is sort of a gateway vehicle to Nissan's CHAdeMo, a quick-charge EV. With the CHAdeMo, Nissan wants to set the standard globally for quick-charge EVs. 

Of course, the CHAdeMo has competition backed by General Motors Co in the form of the Combo. 

As expected, the two competing vehicles do not have compatible charging capabilities, which would mean one will have to win out over the other before a viable solution for installing and managing quick-charge stations can be found. 

EVs have a limited travel range, so it will be essential to have a solution before any large scale adoption can occur.  

Alternatives such as setting up battery changing stations has been suggested, but it remains unclear at this time how realistic of an option that may be.

The spotlight is shining directly on the biofuels industry

Just a few short years ago, biofuels seemed more like a pipe dream than something Gucci would be selling in their 2012 sunglasses line. But in the here and now, that is the case.

Gucci isn’t alone in adopting biofuels and materials into their manufacturing practices. In their case it’s making a pair of sunglasses out of liquid wood product. The fashion mammoth has also ensured that the sunglasses are fully biodegradable.

The bigger issue at hand than fancy sunglasses is the viability of biofuel plants as a feasible option to convert to energy.

Industry analysts are now calling this a “make it or break it” period for the biofuels industry. Currently surviving largely on subsidies, insiders are claiming that advanced biofuel makers are going to have to have some major breakthroughs to get a stronghold on the alternative energy market.

The biofuels industry has found ways in recent decades to relieve any competition with food supplies to assuage concerns in that realm. 

The question now becomes will biofuel makers be able to convince the rest of the world that biofuel energy is a good choice.