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David Milroy

David Milroy

Posted: February 22, 2011 04:48 PM

I blogged last month on this page about the importance of commercialization in the green industry. Reliance on government subsidies can be dangerous, as subsidies inevitably run out. We have seen this in wind and solar. In the public sector, I have found that a good idea backed by good science, even in the abstract, is often enough to attract seed funding and legitimate consideration from, say, the U.S. Department of Energy. And rightly so -- after all, these types of organizations help private companies develop complex scientific abstractions into commercial concepts for the marketplace.

Unlike in government, however, it is difficult to actually sell green ideas on the open market when business applications have yet to be tested, even if they are backed by good science. Solar paint is a great example (and if you don't know what I'm talking about, there's a reason,) but even solar paint is starting to take a step closer to reality: its value is being communicated with increasing clarity to the marketplace.

Running parallel to this is the notion that the success or failure of an idea lies not with the idea itself, but with the ability of its stewards to clearly communicate that idea in an environment in which returns must be realized. Audiences vary, as does the media -- the investment community, and potential customers all want to know, in concrete terms, the value proposition for the next big green innovation.

Thus, creating a successful business from one of these ideas means ensuring actionable value for a marketplace trying to go greener. In the private sector, a good idea and good science, while requisite, do not exist in a vacuum and are by themselves not enough to meet the test most investors impose.

As I continued my company's investment raise across Europe last month, one thing was consistently and abundantly clear in talking to investors and financial analysts from various firms: these days, with the uncertainty of the market, contracting budgets, and limited funding availability, investors are being increasingly choosy about where they put their money. As the (very true) saying goes, they'd rather have an "A" management team with a "B" idea, instead of the other way around.

We in the green space understand that it is our ideas and innovations that will ultimately transform our world-but we must also be reminded that a commercially-focused understanding of the marketplace is key if we want to see our ideas through to their fullest potential.

 

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