Take the redundancies I’ve seen in the last couple of weeks in FM, environmental and sustainable consulting, outsourced technology, mainstream engineering, internal carbon teams. I’ve seen “walk-aways” by corporates on non-core green related activity, sluggishness in buying “green” and renewable energy progress hampered by team downsizing. There is still a lack of investment and we are now seeing the first signs that the Government cuts are going to bite hard!
Show me something different and I’ll believe it! Isn’t this the blueprint the Carbon trust but a few more heavyweight names with a sprinkling of Private Equity folks? It’s not going to solve the problem, is it? What happens to the innovation spawning grounds in the latest melee? Same model of return, different underwriter?
Cleantech Investment - What are the new norms?
Yields of less than 7%, ROIs – think more like 5 years now folks!
Venture funding – it’s all about collaboration and circumnavigating Venture land as we know it now.
VCs – for early stage they really mean well past “post revenue” stage – and lots of it!
Fund raising – if you haven’t done it in 6 months, forget it you better do something different.
Equity – start at 60% and if you are lucky negotiate your way back as you hit the milestones.
Typical deal flow scenario - 400 deals reviewed – 4 investments made – those were the figures quoted – but am I wrong in thinking that maybe the view on returns needs to change which might make the ratio different? Maybe the investment community simply haven’t woken up to the new norms yet?
Commercial Property & the CRC
The exodus from inefficient but lovely looking glass and steel buildings is already starting to happen. My prediction is that swathes of office blocks will soon become empty especially where they cannot provide the smart control aspect of carbon management programme roll out.
FTSE or AIM listed company in your property portfolio? What are you doing to help their league table position? Perhaps just taking the rent is now no longer enough – the new norm might be business collaboration?
CRC progress – estimates that 20% of businesses cannot even make registration.
Expecting help from the Environment Agency – hmmmm seems to be a problem when you can’t find the forms on the website even...
Facilities Management Companies – it’s not just about an EPC and some CHP feasibility & engineering consultancy – get your acts together - you are offering a fragmented, disparate service offering – clients want pro-active initiative, joined up thinking and deep traction across third party relationships to resolve the issues they face. I’m hearing reports that FM Companies are not playing ball with energy efficiency partners of clients ... BIG mistake!
For further insight you might like to have a look at my previous post 'Sustainability and The Apollo Effect'.
Skills & Recruitment
Graduate entrants – forget going in to £30K of debt and trekking to Uni unless you aim to come out with a 2:1! 69 graduate applicants for a single job ...employers are being choosy. Boy do we have a problem in the UK with our Course Content – someone’s forgetting the basics & practicals – it’s all theory!
And – this bit is for recruiters only as I know you all read my blog (the intelligent ones will get to this bit – the others will have zoned out by now)! Judging by the amount of recruiters checking out my profile at the mo – everyone in recruitment is piling into this space... wise piece of advice ... if you see a bandwagon, you’ve already missed it. Those of us who have been around for a while, stick together, the flight to quality will be on soon enough.
Prediction – remember the dot.com days? Now imagine that again with only one quarter of the jobs .... I dispute all the figures quoted about green jobs – I think they are overestimated and lots of jobs will mainstream in from related industry or be internal appointments – because of the climate we are in (maybe with the exception of big wind or maybe retraining plumbers!).
You reap what you sow, no matter what business you are in, so expect payback relative to your customer facing investment – and I don’t mean just in cash terms! Everyone is feeling the pressure but I’ve asked myself many times this month - is there a way to be nice and still do business anymore? – or have things got so bad it’s just every man for himself and screw the consequences in the future?
Sustainable business behaviour ... hmmm perhaps a subject for a future blog.
Photo by gluemoon on flickr