Lanzatech makes the 2010 Guardian Cleantech 100

The 2010 Guardian Cleantech 100 was out yesterday. This list seeks to answer the question: which 100 of today's private cleantech companies are the most likely to make the most significant market impact over the next 5-10 years?

This year saw over 4000 nominations that were eventually funnelled down to around 200 companies, and then presented to an expert judging panel comprised of leading cleantech investors and corporations from Europe, the USA and Asia.

New Zealand company Lanzatech has made it onto this years list which is a fantastic achievement. Lanzatech uses a proprietary bacteria to convert 'dirty' waste gases from industry into ethanol that can be used as a fuel. It has run a pilot plant scale development to prove the technology at the Glenbrook Steel Mill, out of Auckland, since 2007, and has recently signed an agreement to build a demonstration plant at Baosteel's Shanghai steel mill.

Aside from Lanzatech's success in making the 2010 list, the site is a fantastic resource for what is happening in the cleantech sector right now. There is some incredible innovation happening - and proof that we have some of the solutions for combating climate change. The next challenge will be in how to scale them.

SolarAid

The other day I came across a charity here in London that is doing some amazing work. They're called SolarAid, and as their website suggests, they're working to combat two of the biggest threats facing humanity today -climate change, and global poverty.

Right now, two billion people have no access to electricity. They rely on burning fuels such as kerosene and wood for light and heat, which is highly toxic and expensive. Having solar power improves people's health, income and education. That's because solar power can enable people to cook food, pump clean water, run fridges, light homes, schools and hospitals, farm more effectively, and much more.

SolarAid carries out DIY solar projects - training local communities how to build small scale solar devices such as solar powered radios and lanterns - and installs small solar systems for community centres, medical clinics, schools and other such communal infrastructure.

There are numerous efforts across the globe to make big $$ from the next big thing in solar, wind, or biofuels. It is important not to forget how simple, cost effective cleantech solutions can make an immediate benefit to those that really need it the most.

Make your donation here.

LanzaTech Secures New Funding

It was a nice suprise to see a little piece of home in my feed reader this morning - LanzaTech, an Auckland-based Cleantech company, have raised $US18 million in a Series B financing round.

The funding comes from Qiming Ventures and Softbank China Venture Capital, and follows on from the Series A funding from K1W1 (a VC fund set up by Warehouse founder Sir Stephen Tindall), and Khosla Ventures (Vinod Khosla has recently visited NZ to speak at a conference I believe).

Lanzatech uses a proprietary bacteria to convert 'dirty' waste gases from industry into ethanol that can be used as a fuel. It has run a pilot plant scale development to prove the technology at the Glenbrook Steel Mill, out of Auckland, since 2007, and aims to have a pre-commercial scale plant built and active by 2011. The cool thing about this technology is that it can produce clean fuel and reduce the greenhouse gas emissions of industry at the same time. Also, the feedstock is readily available (esp. in China!) and doesn't compete with food or crops like some ethanol feedstocks such as corn.

The pool of capital available in NZ for such investments has always been low. China will increasingly become an option for NZ companies looking for funding, especially in Cleantech - an area that China will need to invest heavily in if it is to clean up it's environmental problems.

I'm back!

Its been a long time between posts and now as I arrive in Europe after 4 months travelling through South East Asia and China, I find myself with a lot more time on my hands and the chance to get back into posting. The next few months will be tough and hopefully I can keep you all updated on how the dreaded job hunt and return to real life is going.

This is a little late I know, but arriving a few weeks ago and taking a quick look at my feed reader, I saw some good news. The NZ government has in its 2010 budget allocated an increase in funding to science and technology of around $320 million. Although I won't go as far to say this is "huge" for NZ science (I agree with Colin James' article in the DomPost), it is good, and it is a step in the right direction.

I've noticed plenty of comment on how there isn't much in there for universities and so-called "blue sky" research, and that most of the benefits of this funding will go to business, which is probably correct. Looking at the graph (shown below) in the 'Igniting Potential' document produced by MoRST, one can see that NZ public sector investment in science is woefully low compared to OECD levels. More money would always be a good thing.

But one thing I have noticed since being in Europe and job hunting, is the presence of the large firms and how they interact with the public sector. I was at a job fair the other day and saw several presentations from large firms emphasising public-private partnerships (and in true corporate nature, the millions that were spent on them!).

NZ private sector investment in R&D is low because we don't have much industry. We don't have a mining industry like Australia (yet!), or the largest mobile phone manufacturer in the world like Finland, or a thriving Cleantech industry like Denmark. It is my view that we need to get our businesses to a level where they are large enough to fund such public-private partnerships, develop their own niche industries, or at least have their capabilities recognised internationally in order to attract partnerships with Multinationals (see Craig Venter + Exxon Mobil).

How do we do that? By giving businesses incentives to undertake R&D, helping them leverage the talent that already exists in our universities and CRI's (Crown Research Institutes), assisting where the whole chain breaks down (technology transfer), and promoting ourselves internationally - which I believe is the important aspect of this new focus by the Government, and one that I am optimistic about.

Tait Electronics

I read an interesting article in the Listener a while back about Tait Electronics, the Christchurch, New Zealand based designer and manufacturer of radio communications systems who this year turned 40.

The story of Tait Communications, and Sir Angus Tait in particular, is quite a remarkable one. Sir Angus was bought up by his mother in Oamaru, and when his father died in the 1918 flu epidemic, he began working in the local radio shop before going on to become an RAF radio operator in WWII. He came home from the war, set up a company...and went broke. He paid off his creditors, then tried again 2 years later.

Tait Electronics was the result, and today it records annual sales of $190 Million in 160 countries worldwide. They invest 12% of revenue in R&D, which is rare for NZ companies, and as a result have a revenue of $300,000 per employee, making them one of NZ's most knowledge-based companies.

Sadly, Sir Angus passed away 2 years ago, aged 88. I wasn't lucky enough to ever meet Sir Angus, but I think we can all learn a lesson from him. He wasn't afraid to give it a go, in fact he failed the first time he did, but he learned, and he came back to create something so wildly successful. I think there is a tendency in NZ to avoid trying anything for fear of failing. But we must, and we must learn from our mistakes. If NZ has another 50 companies like Tait Electronics, we wouldn't be worrying about Taskforce 2025.

"Technology is our sword; we must keep it sharp and bright."

- Sir Angus Tait

Phitek Systems

You may have heard of noise cancellation headphones that dramatically reduce ambient sound sources to create a more enjoyable listening experience. They are rather expensive, but if you have ever used a pair, you will know what I mean when I say they are absolutely incredible!

These headphones work by sampling the ambient sounds sources, converting these into a digital signal which is then processed to create destructive interference, thus cancelling the ambient sound.

What may be suprising to you, is that along with the audio giants like Bose and Logitech that manufacturer these headphones, NZ has a successful noise cancellation headphone company too, Phitek Systems. They have offices throughout the world, including Auckland, Shenzen and Hong Kong, and are due to open one in Switzerland soon. What I think is really promising is that Phitek invest 30% of their revenue in R&D and recognise that the downstream benefits of this may take some time to flow on. I guess this is because they are from an R&D background, having been spun out of Industrial Research Ltd., whereas other companies are unaware and more demanding in this respect. As talked about here, I think business investment is R&D is critical, and I believe we need many more companies with the attitude of Phitek.

As well as manufacturing noise cancellation headphones, they also supply headphone jacks to airlines and have recently won a contract with Virgin Blue in Australia. According to Phitek, they now supply over 50 airlines worldwide, including Singapore Airlines, Emirates, Malaysian, Air New Zealand and Qantas. So next time you're jet-setting around the globe, take a look down at your seat - you might not be so far from home after all.

Rakon

Rakon is one of the success stories for NZ technology based firms. The company based in Auckland, New Zealand, is one of the world's leading manufacturers of frequency timing solutions (primarily quartz crystals and temperature compensated crystal oscillators) for the GPS industry. It claims to supply over 50% of all the frequency control products in this area, which is quite staggering since the world GPS market was estimated at US$30 Billion in 2008, with worldwide shipments of handheld devices numbering approximately 30 million in 2008.

GPS units work by locating four or more satelites, calulating the distance between the unit and each satelite, and then using this information to calculate its own position by a process called trilateration. This is done by timing how long a signal takes to travel between two points, which needs to be known very accurately. This is where Rakon comes in with their quartz crystal oscillators.

When a quartz crystal is cut and mounted properly, the silicon and oxygen atoms that make up that quartz crystal can be made to distort when an electric field is applied. When the electric field is removed, the quartz crystal will return to its normal shape and generate an electric field.
The result is an electric circuit with a precise resonant frequency, to which time can be measured. This is known as piezoelectricity. Such crystals are used in digital watches, cellphones and computers - Rakon sell theirs to GPS equipment manufactuers so that they can measure the time taken for signals travelling between two points and thus figure out where in the world you are.

With the explosion of handheld GPS devices (CAGR 18%) and the inclusion of GPS technology in many mobile phones such as the iPhone, it doesn't take a rocket scientist to realise that if Rakon stay ahead of the game, they will have a very big future indeed. This will only be achieved by having the right science and technology minds behind them - not only imperative to Rakon of course, but to New Zealand.

The Startup Ecosystem

Fred Wilson, of Union Square Ventures in New York, is one of the more prolific Venture Capital bloggers going around. I frequently enjoy his posts on 'A VC', where he covers a range of topics. One that caught my eye recently, was one on Startup Ecosystems.

There has been a lot of talk at the moment around the driving NZ's knowledge economy, in particluar a discussion paper from the New Zealand Institute, and a report on a recent workshop, 'Improving translation of publicly funded research for economic benefit' led by NZ Chief Science Advisor, Sir Peter Gluckman.

In this report, Sir Peter states that we must recognise that the issues we face (there are many - see the report!) are not exclusive to NZ, that other countries have the same ones, no system is perfect, some do it better, some do it worse, but we are a long way behind.

To quote Fred verbatim from his post "Startup Ecosystems Take Time":

"I think it is good to think about decades when you think about the development of new startup hotbeds.

In the first decade, you are largely making it up, copying what works elsewhere, the VCs and entrepreneurs are largely doing it for the first time, and while you can have successes, they are mixed with a lot of failures. That was 1995 to 2005 in New York City and 1965 to 1975 in Silicon Valley.

In the second decade, you start to get it right. The entrepreneurs are doing it for the second or third time. The infrastructure has developed (lawyers, VCs, recruiters). And it is easier to get talented employees to do a startup. This is where we are in New York City now and is where Silicon Valley was from 1975 to 1985.

In the third decade, the ecosystem is fully formed and producing great companies. That is where Silicon Valley has been from the mid 80s on."

According to this analogy, it took Silicon Valley 25 years to mature. If you consider New Zealand has seen declining economic prosperity since the 70's, then that "first decade" has actually been something like four for us! Lets hope 2010 is the year we start getting it right...

The Boy Who Harnessed the Wind

William Kamkwamba is from Malawi. At the age of 14 he was forced to abandon his schooling because his family could no longer afford to pay his tuition after struggling through one of Malawi's worst famines. Not wanting to miss out, William followed his friends school notes, and read from his villages library. After reading a book called "Explaining Physics" where he learnt about electricity, and seeing the dynamo on his fathers friends bicycle, a photograph of a windmill in another book gave William the idea to construct a windmill for his home.

He did this using, wait for it....a broken bicycle frame, a rusted shock absorber for a shaft, a tractor fan for a rotor, ball bearings, and melted down PVC pipes for blades. He rigged it all up on a frame made of gum tree wood, fired it up, and held a glowing light bulb in his hands. Not too bad for a 14-year old boy. Since then he has made a number of improvements, including a car battery to store electricity, a circuit breaker made from nails and speaker magnets, and hand made light switches. He installed lights in all the rooms of his family's home, and has since added a solar panel on the roof. Seeing the benefits this made to his family, he extended his know-how to his whole village, of which every home now has a solar panel and battery for energy storage. The town now has a wind-powered pump for irrigation, and a pump powered well!

His book "The Boy Who Harnessed the Wind" was one of Amazon.com's top science books of 2009, he has spoken at many conferences, including the prestigious TED conference, has started a blog, and has recently returned to school at the African Leadership Academy in Johannesburg where he is studying with the dream of starting his own company to install windmills across Africa.

To gain this knowledge from nothing and to go from building a single windmill, to powering your whole village, to taking the first step towards creating a whole industry in your region is truly remarkable. It shows what can be achieved with some ingenuity and determination. We have that in bucket loads in this country - there is no reason why people, companies, and governments can't do the same here.