It’s all go at the US Department of Enegy. First of all, the DoE has picked 3 VC firms to join its Entrepreneur in Residence (EIR) pilot program which “aims to accelerate deployment and commercialization of advanced clean energy technologies from three DOE National Laboratories into the global marketplace” and then it went and invested a whole shedload in biofuels.
The lucky winners are Kleiner, Perkins, Caufield & Byers, ARCH Venture Partners and Foundation Capital. The entrpreneurs in residence supported by the VCs will get access to one of three DoE labs and the deparment will cough up to $100,000 for each entrepreneur to help “defray salary and other expenses”, which the VCs will match.
Here’s the complete skinny:
Using their vast business expertise, the selected firms will be permitted to give proven start-up entrepreneurs the opportunity to work directly with laboratory staff for a hands-on look at various, commercially viable technologies. Entrepreneurs will conduct technology assessments, evaluate market opportunities, formulate preliminary business cases, and propose business structures in an effort to bring cutting-edge technologies to market.
Upon selecting a technology for commercialization, entrepreneurs in residence and their venture capital sponsors would negotiate a license to use the laboratory-developed technology. Working with their respective entrepreneur, the venture capital sponsors will form and finance a start-up business based on the licensed technology. The foundation of each start-up’s business plan would be the commercialization of licensed clean energy technologies.
To further accelerate the commercialization process, the EIR pilot program seeks to utilize a Standard License Agreement, tailored for entrepreneurs and small businesses. The Standard License Agreement includes a provision that would permit the EIR to offer partial ownership of the start-up company as full or partial payment for the license. This provides the opportunity for a start-up company to use its initial resources to grow the company rather than to make substantial up-front cash royalty payments.
And there’s more: the DoE said it will invest $33.8 million in over four years in projects to convert cellulosic material into biofuels.
These four projects seek to more cost-effectively and efficiently breakdown processed biomass into fermentable sugars, a significant challenge in converting biomass into fuels. Projects were selected based on their demonstrated ability to reduce the cost of enzymes-per-gallon of ethanol by improving an enzyme’s performance. Selected projects must demonstrate the ability to produce enzymes at a commercial-scale, and have a sound business strategy to market the enzymes or enzyme production systems in biorefinery operations.
Those getting funding are DSM Innovation Center Inc, Novozymes, Genencor and Verenium Corporation.