Dec. 4 (Bloomberg) — Garage Technology Ventures LLC, one
of the original investors in the online radio service Pandora
Media Inc., is working with corporations to provide support for
clean-energy startups as traditional venture capital funding
dwindles.
Garage Technology will help “large global technology
companies” identify promising startups that need capital, the
Los Altos, California-based company said in a statement on its
website today.
The collaborative approach represents a shift in the
standard venture-capital model and may lead to as much as $40
million in annual investment to commercialize technologies in
renewable energy, storage and industrial efficiency, Bill Reichert, a Garage Technology managing director, said by
telephone
“We’re investing off their balance sheet and co-managing
the process,” Reichert said. “We become an extension of, and
an intelligence resource to, their venture group and to their
corporate R&D group.”
Garage is seeking to tap corporations for capital as other
sources shrink. Venture capital and private-equity investment in
clean energy totaled $4.9 billion worldwide in the first three
quarters of 2012, compared with $6.3 billion in the same period
last year, according to Bloomberg New Energy Finance.
There’s about $2 trillion in cash that’s “stranded” on
corporate balance sheets and may be steered toward supporting
startups, Reichert estimated. He wouldn’t identify the corporate
partners.
Unlike mutual funds, pension funds and endowments, which
typically are focused on generating returns, corporations are
willing to pursue both strategic and financial objectives.
“There are vast amounts of capital out there that have not
found a particularly efficient way to be mobilized into building
an innovation pipeline,” he said.
To contact the reporter on this story:
Andrew Herndon in San Francisco at
aherndon2@bloomberg.net
To contact the editor responsible for this story:
Reed Landberg at
landberg@bloomberg.net
