JPMorgan Banker Warns of Silicon Valley Trap for Clean Tech

The venture capital model honed and perfected in Silicon Valley is proving a bad fit for the clean tech industry, and investors should instead accept that they’ll need to commit much bigger sums of money for longer periods of time.

“In traditional VC, the model is to make 100 bets, 90 of which will completely fail, and of the 10 remaining maybe a couple will have real exponential growth,” JPMorgan Chase & Co.’s Rama Variankaval said in an interview. However, “the amount of capital you’d need to replicate that in climate is enormous, so you might need to accept a revised model where you are picking fewer, more concentrated bets.”