The private equity cleantech sector has experienced rapid growth in recent years, with private equity fund managers increasingly focusing their attention on the sector. Since 2004, the number of private equity funds that include cleantech investments as part or all of their industry scope has grown rapidly. Cleantech focused private equity funds that commenced making investments in 2008 virtually quadrupled in number in comparison to 2004, increasing from 30 private equity funds in 2004 to 117 funds in 2008.
This increase in private equity fundraising activity clearly signals a boom in recent years in the private equity cleantech sector, but where are these private equity fund managers based and what type of investments are they making? North America is the most prominent region in the cleantech sector, with 45% of private equity fund managers that invest in the cleantech sector based in the region. This is followed by 35% of cleantech firms based in Europe, and 19% in the Asia and Rest of World region, an indication that the private equity cleantech sector is a global phenomenon.
Interestingly, more than three-quarters of all private equity fund managers involved in making cleantech investments primarily focus on venture capital investments, followed by 13% of cleantech firms focused on infrastructure investments, and 7% focusing primarily on buyouts. The remaining 3% is made up of mezzanine, balanced and other private equity fund managers.
The cleantech sector is rapidly expanding, encompassing a global reach and a range of private equity investment types, for more information on the private equity cleantech industry please see The 2009 Preqin Private Equity Cleantech Review