When Investing in Start-Ups- Could Sustainability be the Icing on the Cake?

The New York Entrepreneur Week (NYEW) today had a very thought-provoking session on why investing in green works. Josh Wolfe, Founder of Lux Capital, moderated a panel of clean and green tech experts, including Micah Kotch, Director of NYC ACRE, Maria Gotsch, President & CEO of the New York City Investment Fund, Neil Chambers, Founder & CEO of Chambers Design, Inc., and Giles Watkins, Founder of Concentium.

The panel – and also the audience – expressed their concern about where the U.S. policies for climate protection and alternative energies are heading, or not heading, based on the results of the recent midterm election. Micah Kotch took a stance – defending climate protection as a top priority for governments and businesses, even in tough economic times. For him investing in clean energy means job creation.

Technologies that are expected to be part of our daily lives in about 15 years are electric cars and smart grids, according to the majority of the panel.

The panel also discussed how green businesses can get funding in an uncertain regulatory environment, given that some of their concepts could take years to develop and implement.

Maria Gotsch recommended green start-ups to show the VC community a proof of concept. Municipalities offer different opportunities and infrastructure set-ups to beta test products and services.

One of these incubators is NY ACRE. Its director, Micah Kotch added that demonstrating domain expertise and using the existing infrastructure is also key to get traction within the financial community.

The panel echoed the comments of a social entrepreneur session earlier this week. Mike Del Ponte, founder of Sparkseed, recommended green start-ups to show the financial community that they are a fantastic business first, and then add that – by the way  – they are helping to improve the planet.

Is sustainability the icing of the cake for a good business? Could sustainability be added as a criteria to rate businesses as an investment opportunity on the long run? Sustainability could be the extra bonus to get a A+ rating by VCs. Existing businesses have already indexes, such as DJSI and Global 100.