Oil Wildcatter Comes Clean on Green Technology Investments
Jay Potter has been in the financial services business for more than 20 years, mostly as the president and principal of Nexcore Capital, a San Diego securities dealer and investment banking firm.
For much of that time, though, Potter was a wildcatter. He’d raise capital from investors on behalf of companies like Sterling Energy Resources to drill oil wells all over California, New Mexico, Texas. “At the end of the day, it’s just gamblin’, ” Potter says. “Just plain ol’ unadulterated, ‘Mama-needs-a-new-pair-of-shoes’ gamblin’.”
Translation: It’s a very tough business.
So Potter decided four or five years ago to go clean and green.
“Since people were willing to use their risk capital to drill oil wells,” Potter says, “we decided to get ahead of the curve.” He counts his first cleantech deal as an investment in EAU Technologies, a publicly traded company developing “electrolyzed water” as a non-toxic alternative to chlorine- and alcohol-based disinfectants used in food processing plants to kill food-borne bacteria.
Since then, the 44-year-old investor has become increasingly upbeat about his cleantech investments, eventually forming GreenCore Capital, a private equity firm that specializes in renewable energy companies.
“We’re really operating very much like a venture capital firm,” Potter says, except that he is more aggressively involved in managing his portfolio companies, usually serving as a top executive, director or business advisor.
GreenCore Capital has invested a total of about $35 million so far in six companies, most of which are in the San Diego region. He anticipates raising another $10 million in the near future, “basically to force the companies we have into commercialization.”
Envision Solar probably represents GreenCore’s showcase investment.
The San Diego company was founded in 2006 after a group of San Diego architects collaborated with Kyocera, the Japanese electronics giant, to erect an innovative “solar grove” in a parking lot outside Kyocera’s North American headquarters in San Diego. The grove consists of tree-like shade structures that support large Kyocera-manufactured panels of electricity-generating photovoltaic cells.
Since then, Envision Solar has developed a series of modular carports and lifeports equipped with photovoltaic panel rooftops.
GreenCore also has invested in privately held Envirepel Energy, a company based in Vista, CA, specializing in waste-to-energy technology. The company’s gasification-combustion plant produces electricity and heat by burning biomass and municipal garbage at 600 degrees Fahrenheit.
The firm also has invested in International WoodFuels, a different type of renewable energy startup with technology that replaces heating oil fuel in boiler plants with equipment that burns small wooden pellets, produced in sustainable forests. The company started selling the product four months ago in Maine, Connecticut, Vermont and New Hampshire, targeting institutional and commercial customers that typically use 100,000 gallons a year of heating oil.
“We provide them with a green substitute for heating oil,” Potter says. Once a customer signs a long-term contract, the company installs its own pellet-burning boiler and connects into the customer’s existing hot-water heating system.
Potter says GreenCore’s investments reflect his own pragmatic attitude that America needs all types of renewable energy to break the country’s dependence on foreign oil imports. He agrees with T. Boone Pickens, the onetime Texas oilman and corporate raider, who contends the United States is wasting roughly $500 billion a year importing foreign crude.
“Look, we’re in trouble,” Potter exclaims. “We need whatever it takes to eliminate every (foreign) energy need… To me, it’s all about excelling. I’m a very competitive individual. And at the end of the day, it’s all about clean and green. It’s all about making an indelible change for the future.”