New VC Firm Navitas Raising $35M-$50M for Green Building
By Sari Krieger at Dow Jones
11/25/2008 - Berkeley, Calif.-based venture capital firm Navitas Capital is near to closing its first fund of between $35 million and $50 million, which will be invested in green-building technology companies worldwide, Clean Technology Insight has learned.
Navitas Managing Partner James Pettit said in an interview that he expects the fund, which has a 10-year lifespan, to close in January.
San Mateo, Calif.-based green construction company Webcor Builders Inc. has already signed up to provide some of the money, Pettit said, but he wouldn’t disclose how much. Webcor Vice President Phil Williams will join Navitas Capital’s advisory board, according to a statement.
The fund will include investments from high net-worth individuals and others.
“We think green building as a component of venture capital is going to be a very big segment,” Pettit said.
When asked why he’s launching a fund during a tough credit market, Managing Partner Travis Putnam said in an interview that he thinks some of the best companies will grow in this down market as a lot of larger, established companies are struggling to survive.
“We will be investing in early stage technology companies that have a unique innovation for the green building market and that can be anywhere from the materials that go into the building, to the systems that operate the building, to the information management side of the building,” Putnam said.
Navitas led a $2.7 million venture capital round for Los Altos, Calif.-based green concrete company Integrity Block in June. Pettit and Putnam invested some of their own money on behalf of Navitas.
Before launching a green building investment business, Pettit worked in investment banking for 12 years, part of that time as a managing director for J.P. Morgan & Co. He then spent six years working as a partner at Manhattan Beach, Calif.-based real estate investment firm Bancroft Capital.
“After being involved in a real estate investment project in Boulder, I saw better the environmental urgency as well as the growth potential of green building moving from the fringe to the mainstream,” Pettit said.
Putnam said he spent five years as an investment banker for Los Angeles-based Murphy & Associates Capital and three years as a construction industry consultant prior to starting this firm.
“Jim and I have been looking at this sector of clean tech since 2005, and in our view, green building crossed the tipping point in mid-2006,” Putnam said. “The paybacks were attractive enough where builders and developers were starting to adopt green building practices. It’s the perfect storm right now of policy-driven markets and financial returns driving the market and you have rapid acceleration of green buildings. Even in a down construction market, builders and developers are looking to differentiate themselves.”