Now what I am about to say is not marketing, it is extremely important to the point I wish to make.
IES is seen by the venture capital community as a Cleantech company. We have won Cleantech awards and are highly rated in many VC Top Cleantech company lists. Now IES supplies our technology to the construction industry yet IES is seen as Cleantech and the construction industry isn’t – Why?
Look at the companies that are grouped in the Cleantech space for example there are companies which cover renewables, energy storage, advances materials, energy controls, environmental quality and safety, and water. The IES software covers all of this and more so we are a Cleantech company.
Now it is the architects and engineers that have to wade through the Cleantech manufacturer’s greenwash then design and make this Cleantech technology work in buildings. They are the ones that have to make the buildings meet increasingly stringent regulations and also get a good BREEAM or LEED rating.
Therefore why are companies in the Cleantech space so highly regarded by the VC community but the construction industry is not? The growth potential for Architects and Engineers in terms of sustainable design is increasing dramatically so why are construction companies not re-branding themselves as Cleantech?
I think there are three reasons:
• The construction industry is seen as a low margin business and hence not sexy as far as VC’s are concerned.
• The construction industry is a behemoth that is slow to respond. Other industries (e.g. utilities, renewables, materials) have been quick to jump onto the Cleantech bandwagon and these companies have seen their share value benefit. How many products have suddenly become ‘Green’ over the last few years.
• The worldwide construction industry is being forced into the sustainability market e.g. regulations and market forces such as Voluntary Environmental Rating Systems (VERS) such as LEED and BREEAM. If you visit the websites of most construction companies they talk the talk but crawl the walk.
As a consequence construction companies are not seen as Cleantech. However, I expect some bright, nimble architects or engineers will see that they have more chance of significant VC investment and subsequent value if they alter their business model and differentiate themselves by committing fully to sustainable design. I am sure they would get the VC funding with the right strategy and that they would be successful.
Once the sustainable design business model was proven the Behemoth would slowly turn in the right direction.
