There’s an exodus of people from Silicon Valley venture capital firms and IT companies to green technology startups, The Economist reports.
The attraction? The potential to make money with a conscience.
“There is an unbelievable migration of talent from traditional technology to clean technology,” Adam Grosser, a partner at Foundation Capital, a big Silicon Valley venture capital firm told the magazine. “They have had their social conscience energised, and they believe there is a lot of money to be made. So you get to exercise your capitalist desires while feeling self-righteous at the same time.”
The market for green goods and products is growing as governments, corporations and consumers are trying to reduce greenhouse gas emissions. Governments are supporting green (or “clean”) technology and the risks involved in new technological development are falling.
The staff migration from IT and venture capital to this new sector is less about the transfer of technical knowledge about biofuels, electric cars and emissions sequestration, and more about the higher tolerance of risk that IT firms and dot-coms tolerate, and their attraction to a nascent industry which they see they can dominate.
Legendary venture capitalist and co-founder of computer maker Sun Microsystems, Vinod Khosla, is one of the IT moguls who has switched his attention to green tech. Khosla believes that Silicon Valley entrepreneurs have a competitive advantage in this industry because they must be good at understanding and managing technology risks, regardless of industry.
“People in venture and IT are used to operating in a context when you don’t know if a technology will work, and we start building before the design is finalised, and fix it as we go along,” he says. They are also used to – and more comfortable with – a high failure rate, which they balance against the prospect of rich rewards of success.