VC firm Southern Cross to oversee $200m clean energy fund

Australia’s premier private equity body has welcomed the announcement that Southern Cross Venture Partners will oversee the government’s Renewable Energy Venture Capital Fund.

The Australian Private Equity and Venture Capital Association says the government should be applauded for quickly establishing the $200 million fund after announcing it earlier this year.

The REVCF mandate follows the government’s recent announcement of its final round of funding under the Innovation Industry Fund to commercialise innovation and research.

According to AVCAL chief executive Dr Katherine Woodthorpe, the REVCF mandate recognises the unique role venture capital fund managers play in commercialising innovation.

She also commended their expertise, including their ability to attract private investment capital.

“The government… must play an important part in funding and coordinating investment in innovation if Australia is to help lead the commercialisation of renewable energy technologies,” she says.

“Venture capital fund managers – usually former successful entrepreneurs, scientists, doctors and engineers – are ideally placed to help commercialise Australian innovation.”

“[They are adept at] applying a business mindset, and working hands‐on with the company founders and management, to generate returns for investors.”

Meanwhile, it’s been reported venture capital executives are tipping a decline in investment levels for clean technology companies in 2012.

The claim, made by clean energy website AOL Energy, is based on research conducted by the National Venture Capital Association in the United States and Dow Jones VentureSource.

Together, they interviewed more than 500 US-based venture capital executives about 2012.

“We can expect a competitive environment for capital on both sides of the ventures business in 2012,” Dow Jones VentureSource global research director Jessica Canning said.

Canning is referring to both the seed and early-stage funding environment, and the traditional venture capital partnership funding arena.

“With nearly three quarters of VCs predicting limited partners will commit the same amount or less to the industry, and about the same proportion of CEOs expecting to raise money, financings could get tighter, with some companies left to survive on their own,” she said.

The IPO pipeline, which has been blocked for much of the past five years since the global financial crisis first emerged, is expected to be even tighter in 2012.

Only 15% of the VCs interviewed see increases in IPO volume for clean technology in 2012.