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Building a Green 21 Century: Tracking Venture Investments in Green Buildings to Uncover New Opportunities

"Green buildings" has emerged as a critical investment category at the nexus of energy security, environmental sustainability, and corporate social responsibility. Since 2000, venture capitalists have invested $4.06 billion in developers of equipment, systems, services, and materials that improve the energy efficiency of buildings and homes. Developers like Tridium, Encelium Technologies, and SAGE Electrochromics have advanced their technologies from seed-stage rounds to acquisitions by giants, and this early wave of acquisitions is poised to keep growing. However, opportunities for some current-generation technology and material developers are nearly gone, and exit prospects for their investors are bleak. Opportunities in integrated design, on-site generation, energy services, advanced building envelope, and low-carbon cement and concrete are all technology areas investors should pursue.

Table of Contents

  • Executive Summary
  • Landscape
    • "Green Buildings" has Emerged as a Critical Investment Category at the Nexus of Energy Security, Environmental Sustainability, and Corporate Social Responsibility
      • "Green Buildings" are those which Integrate Green Building Technologies…
    • The Business Case is Clear for Technologies that Generate a Timely Return on Investment
    • The Green Buildings Investment Landscape has Blossomed Since 2005
      • North American Startups Were First to VC's Troughs and Have Been Magnets for Investment Ever Since
      • EBESS Developers Have Raised the Most Funds, but SBMs and Integrated Design are Gathering Steam
    • The Boom in Green Buildings Investment Activity Reflects a Boom in Technology and Business Model Innovation
    • Landscape Conclusions
  • Analysis
    • Venture Opportunities in the Current Generation of Lighting, Software, and Energy Monitors are Nearly Gone
    • Promising Opportunities Lie in Integrated Design, On-site Generation, Energy Services, Advanced Building Envelope, and Low-carbon Cement and Concrete
  • Outlook
  • About Lux Research
  • Endnotes
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