Venture capitalists have always kept their distance from Washington, D.C., and they were proud of it. The investors in start-ups believed that their expertise combined with market forces were enough to ensure an investment succeeded - or failed, in some cases.
But that has changed with a surge in the U.S. government’s interest in renewable energy, which comes with billions of dollars of funding and thousands of pages in laws and rules. At the same time, VCs have realized that the new technologies need government support to reach maturity because they are targeted at regulated markets and require larger amounts of money because of their scale.
“I’ve been in [Silicon] Valley for 30 years; there’s never been a greater need to look at Washington at a minimum, as a necessary partner, and at a maximum, as a collaborative partner to create start-ups,” said Josh Green, general partner at Mohr Davidow Ventures, in Menlo Park, Calif.
Green has increased the frequency of trips he takes to Washington, as have other partners at his firm, to ensure that lawmakers and regulators understand how “a turn of a phrase might effectively kill or create an industry,” he said. That was the case with the $1.6 billion manufacturing tax credit for renewable energy companies included in the $787 billion stimulus legislation approved in February, which in its draft form didn’t apply to early-stage companies....MORE
Thursday, May 14, 2009
The Path To Washington: VCs, Cleantech Start-Ups Seek DC Ties
From Dow Jones' Venture Capital Dispatch (Now with Bloggy Goodness!):