Which Comes First, the Vision or the Egg?

At a recent conference, a venture capitalist on the panel ‘Securing Venture Capital’ said, “We aren’t the technology experts, but we know how things should work.” The VC went on to explain that they should not be tasked with being experts themselves; they needed to trust that those with the ideas had the expertise to understand whether or not the idea was viable. The VC noted that the team bringing the idea or invention forward is what they are investing in, and the expertise of the team is assumed.

Hmmm … a rhetorical, practical and boring question … If you don’t understand the technology or perhaps the industry, how do you know how things should work?

Regarding solar … this is an industry that has beaten many a visionary team to a pulp with the difficulties of developing a technology that is highly capital intensive, depending on the technology, difficult to commercialize, and having to work within an incentive-driven market that is anything but easy to traverse. To stick with the aforementioned caveats and difficulties you have to be a true believer — seriously, with the hard knocks that come at you right and left if the team behind the idea doesn’t truly believe above all odds … they are doomed from the outset. So … the idea team must believe, but they also require help from an objective disinterested source.

One of the most wonderful aspects of the solar industry (all technologies — PV, CSP, and CPV) is that the industry is filled with true believers. The people embarking on these technologies do not always understand the market landscape, or accept the technical and market challenges — but, they believe it can and will be done. Over time, they will have to believe against significant odds, not the least of which is the continuing requirement to raise funding again and again as the company travels along its development timeline. So … the management team MUST believe in order to continue.

Most believe that they are the first to make it cheaper or more efficient, that they have discovered a new form factor never before seen, that it will be easier for them than for anyone else, and, no matter what, they will sell all they make. As solar is a renewable, clean energy technology, the team is quite literally contributing to saving the environment and therefore is part of the solution to saving the atmosphere of the world. It’s easy to believe in saving the world, just darned hard to make money doing it.

The more the team believes, the more objective one must be when assessing the idea. And this objectivity can come off as negative and shortsighted — but, it is as necessary as the idea itself. Because … like it or not, the world does not run the way it should. Often, sadly, it runs exactly the way it shouldn’t. For an idea, invention, or business to successfully enter this cantankerous energy market, it must fit with the market realities.

Solar is already a disruptive technology — even tried and true crystalline is a game changer. Solar is reinventing the energy wheel … to finish the reinvention it needs thoughtful, aggressive and farsighted support. Solar obviously needs venture funding, along with strong funding support from governments, angel investors, equity financing and others.

There are simply too many roadblocks on the way to commercialization and profitability to keep a nonbeliever alive, so the industry needs its true believers. Along the way it requires funding and it needs its funders to believe also. At the same time, funders must be pragmatic enough to realize that understanding and believing are not enough.