Cleantech upstarts team with Big Oil - Silicon Valley / San Jose Business Journal:

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Cleantech’s initial attempts to take on incumbent industry giants such as oil companies are starting to give way tosymbioticd partnerships. The past several yearxs saw a lotof “overzealous venture investing” with entrepreneur s and startups going completelt vertical, said Jason Matlof, a partnefr at in Menlo Park. “You had biotechnology companiesz trying to be biofuels producers and and trying to take on the likesw ofChevron head-on,” Matlof said.
“Whatf we need to do is apply thos newtechnologies — whether bioconversion technologgy for cellulosic ethanol or solar thermal plant technologt or batteries for a next generation plug-ih vehicle — to an existing mainline, mature Those changes are now happening. In May, $10 billion oil refininy giant took an undisclosed stake in Battery portfoliocompany , a Mass., biofuels company. BP plc also holds a significant stake in the And the consensus among Silicon Valley investors is growin that partnering with incumbents is critical to the futur of the renewableenergy market.
“The scale of thes industries is bigger than any industries technology entrepreneurs have everplayedd in,” Matlof said “It’s too much of a challenge not Matt Horton, a principal at @Venturezs in Menlo Park, has been investingf in cleantech startups such as portfolio company Propek Fuels Inc. since 2001. The alternative fuelx retailing company is partneringwith Shell, Chevron and some unbrandedf independent station owners to add another retaiol fuel option at the pump.
It’sw also selling renewable energy credits to big oil incumbentws to help them comply with EPA renewableenergy “Major corporations that have a strategixc interest in these markets have a great opportunity to partner with yountg innovative companies like said Horton, who took over as CEO of Propepl in February. “For smaller companies like ours, it’s importanf to us to provide value to companies like that rather than attacking themas competitors.
” companies solely focused on research and development a few yearx ago are looking to scale-up operations and head to At the same time, the influcx of renewable energy standards and other government policied have made incumbents more eager to partne r with companies producing high-quality solutions, according to New Enterprise Associatese Menlo Park partner Ravi Viswanathan. NEA portfolio companies, such as SolFocus Inc. and Skyline Solar both of Mountain View, and Fremont-based renewable energy storagse outfit DeeyaEnergy Inc., are partnering with traditional energuy and utility companies. “This is somethingy we had hoped forand expected,” Viswanathan said.
Houston-based Bakerd Botts LLP and Dallas-based Haynes and Boons LLP, both new to the Silicon Valleyulegal market, are playing a key role in the growing Attorneys at the two firms are making strategic introductions between larg e institutional energy clients and venture capital clients focused on renewable energy technologies. The law firms are working to orienyt VCs on what it takes to develop a successfuk business in theheavily regulated, multibillion-dollar energy sector.
“We’rse looking to enable capital sources, management larger strategic companies to exploit opportunities we see developintg in the sector over saidScott Wornow, a partner in the Palo Alto office of Bakert Botts, an 800-lawyer firm. “Ij think that’s going to become even more so with respectr to international players as cleantech becomedmore mature.” Oil companies have a naturao role in the development of alternative energy and certainl y alternative fuels, said Haynes and Boone cleantech partner Paul The 500-plus-lawyer firm absorbed the San Jose and Orange Countt offices of MacPherson Kwok Chen Heid LLP in February.
“Not only do the incumbenty energy players have decades of experience inenergy markets, but they have deep pockets,” Dickerson “These partnerships are something that assist our cleantech entrepreneursa in achieving their goals in a time frame that’sx consequential.” Dickerson served as chief operating officer of the Energh Department’s Office of Energy Efficiency and Renewable Energyu during the Bush administration.
By bringing togethe r developing technologies with established existing markets can be better served by thosew who already operate inthat