Will the popular incubator program for young web and mobile start-ups, Y Combinator, work for cleantech? That’s what a group of entrepreneurial investors including Mitch Lowe, Dave Graham, and Dillon McDonald, are looking to find out. On Tuesday morning, the team is launching Greenstart, an incubator and investment project that is looking to give seed funding and mentorship to the most promising young cleantech startups as they try to perfect their business plans and gain customers.
Lowe explained to me in an interview last week that Greenstart is looking to do four things for the young teams it selects to join its group:
Greenstart plans to operate out of a 7,000-square-foot office space in San Francisco,which can offer an open and collaborative experience, and is available to their teams for about three months. Greenstart is calling for all budding entrepreneurs to pitch them for the upcoming program, which will start Sept. 12, 2011.
On the surface, I like the idea. As Lowe put it to me: “We are cognizant of how difficult it is to start a greentech company … We just really want to help entrepreneurs who are starting cleantech companies be more successful.” It has become particularly hard to be an early stage cleantech startup in recent months as venture capitalists seem to be shifting towards later-stage and follow-on investments. Lowe says this new incubator model could help fill that gap.
However, there are a couple of hurdles I see for the program. I just don’t know if the incubator web model fits into the cleantech model. Unless the projects are only going to produce cleantech lite or cleanweb products (basically software and web-based cleantech projects), $25,000 won’t go far for a more science or materials based project (biofuels, clean power, etc). The Department of Energy’s ARPA-E program commits about the smallest grants I think are possible for chemicals, materials and biology innovations, at around a couple million dollars each.
The investing team doesn’t have that much cleantech experience, which they say will be made up by the mentor group. But if a group is bringing you mentors, why not just skip the middle man and go straight to the mentors? Also, if the Y Combinator model would work for cleantech, why wouldn’t Paul Graham (Mr. Y Combinator) just bring in more cleantech companies, or launch his own cleantech version? Food for thought?
Image courtesy of Al Albut.
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