A very informative article here about the effect of venture funding for clean energy technology companies.

Although venture funding for environmental technologies doubled in 2006 to $1.28 billion, this is still a fraction of what was raised through IPOs in 2006. Of course, stockmarkets and venture capitalists are not usually competitors. That's because VCs tend to get involved early on in a company's formation whereas the IPO is - quite often - the crowning glory of a company's history. So for successful firms, venture funding very frequently preceeds IPOs.

Take Trina Solar for example. As the article reports, Trina received the third largest venture financing - $40 million ahead of its initial public offering late in 2006. Since going public, a lot more money has been raised. The stock is now worth $240 million.

We should not take this as a given though. At the end of the dot-com crash, VC funds were sitting on a lot of cash with very few opportunities, whilst the IPO market took years to recover. If - as some believe - we are in an alternative energy bubble today - it is quite possible this will happen again and VCs will be a lot more powerful than they are today.