In this edition of WEN, we revisit Winslow’s focus on the rapidly growing markets within the green economy. The ongoing oil spill in the Gulf of Mexico is a blunt reminder of the environmental challenges faced by society now and in the future, and it is not surprising to find many significant growth opportunities that are being generated by the quest to overcome those challenges. In this edition of Winslow Environmental News, we’ll look at the specific growth potential behind many of the green business segments in our universe, and we’ll take a closer look at several of our portfolio companies that occupy spots in three of these growth segments – water services, natural foods, and LED lighting.
MAIN ARTICLE / MARKETBEAT: The State Of Green Investing® Today
The market for environmental solutions faces a number of short-term challenges, from tight credit conditions to slower-than-expected development of climate policies in the U.S. But the major environmental issues faced by our society are still creating significant market demand for solutions, and innovation, talent and capital are flocking to meet that demand. In this article we reaffirm that the universe of sustainable solutions companies continues to multiply and mature, and that according to a wide range of respected third-party sources, many sustainable solutions markets continue to generate double-digit long-term growth – a relative rarity in today’s low-growth economy.
ISSUE SPOTLIGHT: Nalco, BP, and the Gulf Cleanup Effort
We invest with an eye toward independence from fossil fuels, but we do own one company involved in the cleanup of the Gulf of Mexico oil spill – Nalco, a leading water services company. Nalco’s involvement in the spill cleanup effort has become somewhat controversial – the firm is supplying an oil dispersant called Corexit to BP, and BP’s large-scale, underwater deployment of this dispersant is without precedent. Because of concerns about toxicity, some media members have been heavily critical of Nalco. At Winslow, we are very focused on fundamental research and on getting to know our portfolio companies from the ground up, and as we discuss in this article, our research suggests that the condemnation of Nalco is not warranted.
FEATURED COMPANY: BioExx
Global food and protein supply is an increasingly important resource issue for the world’s growing population, and because the production of animal protein consumes significant resources and produces significant emissions, any new solutions that enable production of vegetable protein are very desirable. Enter BioExx, a Canadian company that has developed a patented method to extract protein for human consumption from canola – it is the first company to figure out an economical process for canola protein extraction. Their product has the potential to compete with soy protein in a vegetable protein market expected to grow to $26 billion by 2015.
TECHNOLOGY UPDATE: Manufacturing Technology in the LED Lighting Market
As discussed in our last issue, the LED lighting market is a very promising green investment opportunity. The technology behind LEDs is rapidly developing, with the hope that technology improvements will allow for mainstream pricing of LED general illumination in the next few years. At publication, Winslow portfolios were invested in several LED-related companies, and two of these companies – Rubicon Technology and Veeco Instruments – are key players in the LED supply chain that are moving the science of LED manufacturing forward.