As the new CEO of a Bay Area energy biotech company coming from a major oil company, I have a bit of an outsider’s view. Here are my suggestions:
1. Understand that not every problem has a quick solution. Years of startups and venture investing in tech companies have conditioned a lot of people to think that you can invent, commercialize and get to an exit strategy with energy technology like you could with social media. You can’t. It requires patient capital, strategic partnerships and execution by people who have “been there, done that.” Entrepreneurs and funders need to accept this and not seek the quick exit.
2. Appreciate that there are no APIs or open source code for energy technologies. Breakthroughs require millions of dollars of capital for the lab and early pilot phase, then hundreds of millions of dollars for commercialization. Smart entrepreneurs are looking beyond the Silicon Valley ecosystem to both traditional strategic partners like infrastructure companies, and non-traditional partners like the military to accelerate funding and development.
3. Accept that in the world of energy, even the lobbyists have lobbyists. Creating new energy solutions cuts across various government entities, from regulatory (like the Federal Energy Regulatory Commission, Environmental Protection Agency, Department of Energy) to funding (grants, earmarks, incentives, tax credits, etc.). A former boss who I highly respect once told me that biofuels are bi-partisan—they aren’t red; they aren’t blue; they are purple in that they cross and are supported by both sides of the aisle. It may seem anathema to hard core entrepreneurs in the Valley that projects and technologies can’t win on merit alone, but I’ve seen firsthand the impact of representation on the Hill in creating long term opportunities for new companies and technologies.
[[Editor’s Note: This article is part of a series of guest editorials we are running as part of the launch of Xconomy San Francisco. It was based on a question we are posing to technology leaders: “What three things can San Francisco and Silicon Valley entrepreneurs and VCs do to foster a more stable environment for innovation in IT, life sciences, and energy, and become less wedded to cycles of boom and bust?”]]