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by jenn.kho on April 14, 2010 on Sweat Investor

SweatInvestor Guest Post: Jennifer Kho is a San Francisco Bay Area-based freelancer with more than a decade of reporting experience. Her stories have appeared in The New York Times’ Green Inc. blog, The Wall Street Journal, Los Angeles Times, MIT’s Technology Review, The Christian Science Monitor, Reuters.com, Earth2Tech and more. She has been covering green technology since 2004, when she initiated cleantech coverage for Red Herring magazine. She also helped launch Greentech Media’s news operations as its founding editor in 2007.

Sure, the Google Campfire last month announced its apps marketplace by the glow of kitschy fake campfires, under a canopy of fake tree silhouettes, in a room with a tent and campfire-logo fleece blankets as giveaways. But only the props were fake. The event was backed by a real product with 50 real customers. And, as fitting an enterprise product, it definitely qualified as a restrained launch for a company as big as Google.

Bloom Energy used some of the same tactics when it launched its fuel cells in February — although there was certainly nothing restrained about the event, which took place at eBay headquarters and included California Gov. Arnold Schwarzenegger and former U.S. Secretary of State Collin Powell. As with Google Apps, Bloom kept (mostly) quiet until its launch and then made a splash by announcing key customers, including Wal-Mart, eBay, FedEx, Staples and, of course, Google.

The result, in the case of Bloom, was a huge bang of publicity. With its star lineup of Kleiner Perkins investors and directors such as Powell, the company scored a feature on 60 Minutes and many high-profile publications followed. All the hype has sparked envy from other startups that want the same attention.

Should other startups take a page from the launch book of Bloom, Google or Apple, which also has been known to keep quiet until a product is ready (although not in the case of the iPad), and get more attention by keeping quiet?

If You’re Not Google

Well, it doesn’t always work. One major difference, of course, is that Google and Apple launches are guaranteed to be big news. As a reporter, I knew I’d attend the Campfire regardless of what was being launched – and I was sure I’d get a story out of it. And Bloom had the advantage of big newsworthy backers and partners right out of the gate. Not so for most startups.

Using stealth as a marketing strategy comes with plenty of potential pitfalls, as well. Of course, the main reason to keep a company or technology quiet is to protect intellectual property. Once patents are secured, the decision becomes one of strategy.

Melody Haller, CEO of public-relations firm Antenna Group, explains that if you’re a big company, you have two choices: One is freezing out the competition by pre-announcing products that aren’t ready yet, which is a tactic Microsoft is famous for. (Once Microsoft has announced it is entering a space, competing startups are less likely to score backing from investors or partners as they wait to see what Microsoft has in store.) The other is waiting until a product is ready before launching it, like Google does.

The Cost of Quiet

The choices aren’t the same for most startups, as speaking out is less likely to deter competitors. Keeping quiet might help artificially bolster a launch, but could have the opposite effect if the company isn’t viewed as newsworthy enough to cover. In the meantime, the company may be missing out on potential partnerships and customers that could ultimately help it succeed. “It comes at a cost,” Haller says.

The extent to which a startup should talk largely depends on how much it needs others, she explains. For example, a company with a limited customer base and good access to those customers needs far less publicity than a company targeting consumers or hard-to-reach customers. Building a reputation can help companies meet those partners, or get them to pick up the phone.

In general, if a company’s in stealth mode after patents are filed, it’s a sign its product isn’t ready yet – or it’s still working out an issue that might not stand up to public scrutiny. Personally, I tend to be skeptical if a company makes big claims while keeping its product hidden from public view. Most entrepreneurs I’ve interviewed are proud of their products and want to discover any problems early.

Public Troubleshooting

The danger of avoiding public scrutiny is the same as the danger of skipping peer review in science experiments – you could be missing a significant challenge which could end up being an Achilles heel. Once a product is launched, a company will usually have to spend more time and money to correct the problem than if it discovered the issue earlier.

By isolating themselves, startups also can end up victims of their own company cultures, Haller points out. Because startups tend to be dominated by researchers and engineers, rather than employees focused on marketing and selling products, they might focus on the science and technology and miss usability problems that their customers might face. Companies tend to be optimistic, which can be a key to success, but could also blind them to potential failures.

Finally, if startups succeed in generating huge launch buzz, it could be setting itself up for a fall if it can’t meet the lofty expectations it has (perhaps inadvertently) created. In other words, the greater the publicity, the higher the expectations – and the easier it is to plunge in the public eye.

Slow and Steady…

In the case of hardware, for example, it’s important to match publicity with the company’s ability to deliver products, Haller says. If a big launch creates more demand than a company can fulfill, customers will be disappointed when they can’t buy the product and the company could suffer a backlash, she says.

The best strategy depends on the specific product and its target audience. When the product is a free social networking tool, for example, which depends mainly on popularity for success and doesn’t face product availability obstacles, the challenges are different. In that case, it’s more important than ever to get the word out early and test the product with a beta group of early adopters while the user base grows, Haller says.

All in all, the biggest point startups can take away from Google and Apple product launches is the importance of building a company, she says. Google and Apple didn’t take shortcuts, but first built strong companies and products – then used savvy marketing strategies to get the most out of their launches. They need publicity because the success of their products depends on having users, but they deserve the buzz they get because they have – for the most part – lived up to the claims and expectations they have set, Haller says.

Compass

If you are concerned, as I am, that climate instability is a critical issue, then you are very lucky to be a PR pro. Your craft gives you the power to make a difference. No scientific finding will be acted on unless someone has the skill to explain and transmit it. Solutions will go unused unless thousands of PR pros like you and I direct our skills to create understanding and the will to try.

Challenge equals opportunity. There is a ground swell now: Flagship businesses are proving that sustainable practices are safer and more profitable, especially as new policies include the real costs of wastefulness.

Scientists, entrepreneurs and policy-makers are searching for improvements to every practice of civilization. Governments on every continent face the need for transformation. And citizens want to do more than spend their lives as unconscious consumers. Green is good business; it’s industry; it’s life.

Four PR paths

There are four PR paths: Cleantech, Corporate Sustainability, Green Lifestyle and Government Relations. Build on the brand you have. If you excel at corporate counsel, then learn the principles of corporate sustainability. If your expertise is in consumer products, lifestyle or healthcare, then you can shift toward green lifestyle and LOHAS (lifestyles of health and sustainability).

If you’re in government relations, you may already be experiencing a boom in demand. Modern energy and efficiency have been designated the saviors of our economy and environmental woes.

My passion is cleantech. Emerging technology has always excited me: I love being at the edge of change and am willing to accept the business risk that comes with that.

Guidelines for going green

Like a good physician, above all, do no harm. Entrenched power players will keep acting in their short-term self-interest. You don’t have to help them. The knowledge you may have of a dirty business can get you a good job or client engaged in cleaning it up.

Avoid greenwashing, for your company or your clients. Do your homework and bring your heart to your work: How satisfying that is!

Don’t be afraid to set sail in a new direction.  Antenna Group was founded in dotcom days. I met our first solar client at a cleantech venture-capital event. Go meet new people and perspectives.

Build community. If there aren’t useful green networking events in your area, you can organize them for your clients as a way of refocusing their practices and brands. Antenna started our Power Hours three years ago – now we host seven or eight receptions a year, each with a different co-host to spice up the guest list. We also sponsor events.

Extend from your base of strength. Building on one good client in the solar space, we now represent about a dozen solar companies (and many more in other cleantech areas). The first one is still a happy client, five years later. We’re now attracting Fortune 500 clients seeking guidance in areas new to them.

High-tech PR with industrial gunk

Like the technology PR of recent decades, cleantech PR works with wildly creative scientists and entrepreneurs. We try to win our clients a temporary suspension of disbelief so they have a chance to turn their dreams into reality. Using our technical and business knowledge, we paint their products into the landscape and translate their technology’s features into the audience’s benefits.

Unlike Web 2.0 and software high-tech, cleantech is about the messy physical stuff of our world. It spans many different industrial and manufacturing sectors and is overlaid with complex issues of public policy and finance.

For each client at least one audience will be extremely technical, yet you also have to be able to communicate to business, finance, government and community audiences, internationally. If your practitioners do not genuinely enjoy the constant learning about science, technology and policy, you will lose either them or your clients.

In hiring I aim to create a mix of people to learn from each other. Those with strong technical affinity collaborate with skilled PR pros, as everyone grows. My ideal entry-level candidate arrives with a dual-major degree in Communications and Environmental Science or Economics.

Purpose at a premium

While these people are deeply purpose-driven, they are talented high-achievers who expect to be rewarded well. I’m still trying to figure out how to charge the premium the craft deserves. The traditional industrial sector hasn’t invested much in marketing, other than IR or crisis communications.

But marketing spends will grow as the young cleantech industry sees more big successes and becomes increasingly competitive. Companies get the best leverage on their PR investment when pursuing a large market opportunity in the midst of substantial competition. And there’s never been a larger market opportunity than modern energy.

Climate change and a shift in global policy favoring renewables has yielded widespread venture capital investment in the cleantech sector. Over the past 2-3 years, it seems that most VC firms have naturally evolved and now have a “cleantech portfolio” on their Websites. These firms have combed through the scientists and Ph.Ds at the world’s premier learning institutions, appointing the best and brightest to their cleantech advisory boards to round out intelligent investing with deep industry knowledge. Allotment of money, especially in the energy efficiency space, is now mainstream. It appears that all the tools are in place, yet VCs are still getting knocked when it comes to cleantech investing.

Two of the hottest areas now in VC investing are smart grid and energy efficiency, a clear advancement from ten years ago, before the term “cleantech” was even coined, when risk-taking individuals or large corporations gambled on unproven science projects. Could it be that the people doing the investing have not developed as quickly as the technology has? That might be part of it, but an explanation that I heard at a recent conference is much simpler: Cleantech investment “rules” are counter-intuitive to what VCs know.

Traditionally, a venture capitalist will search for or get pitched with a new idea or technology, thoroughly research the markets and become an expert on the innovation that they hope will spawn returns ten times that of what they put in. Investments in the Internet, enterprise technology or IT move very fast, as do advancements in those areas. Cleantech, especially energy efficiency, doesn’t have the same rule book. Energy is colossal—it’s bigger than any other area VCs have invested in before. Two-thirds of the planet uses it. It’s also slow, with R&D moving at an intense yet more measured pace than other technologies that VCs are accustomed to. Policy also plays a large part in cleantech investing, something that has not been a big issue in other types of tech.

Fortunately, investing in the cleantech space still has a lot of room to grow. I think that the success it promises to yield needs a more appropriate measuring stick as expectations are adjusted. Cleantech is still a fairly new game to VCs, and I think it will take time for the returns to roll in the same way they have in the traditional sectors that VCs are very experienced with.

Don Solo/Flickr

Cleantech companies are particularly prone to intellectual-property paranoia. Caution is reasonably called for: do get those patents filed before gabbing.

Industrial innovators burn a lot of capital before reaching healthy revenues. Some directors cut cost corners by keeping portfolio companies in stealth mode for years. A small executive team is expected to reach key customers and get sites installed with little more marketing than a cursory website. Supposedly, this not only saves money but also hides their brilliant innovation from imitators.

Companies may be lingering too long in the shadows, simply because their leaders don’t understand the power of the strategic communications sword. How many VCs or board members do you know who have a strong marketing background? Yet history shows the best technology does not always win. The good-enough solution that is fastest to penetrate the market and relentlessly defends its leadership will win the lion’s share.

Even in situations where staying under the radar might give an edge versus competitors, it also brings a downside: it hides the company from customers, potential talent and the investors needed for each new round. A company that does show market momentum also has a better shot at winning approval for its ARRA application. Smart PR accelerates all those initiatives. So, what is not invested in public relations may instead be lost on a longer sales cycle, larger sales force, costlier executive-recruiter effort, more expensive capital and far more CEO time spent courting reluctant investors.

Shut off from a real market response, a company can get trapped in a self-referential box. Unable to outgrow its anti-marketing culture, it may be on its way to cleantech Betamax, to being Novell instead of Microsoft.

The transition from hiding your light under a basket to being able to dazzle your customers is as difficult for a company as puberty is for a teenager. Luckily, unlike puberty, you can hire people to help you through it.

When Congress returns to Capitol Hill from its two week recess next week, it’s expected to tackle the energy bill in earnest. A major provision in the bill that could drastically increase growth in the renewable energy sector is the concept of a national renewable portfolio standard, or RPS. The RPS tactic has been successful in 28 states in creating a market for renewable energy, and if the U.S. is serious about building a carbon neutral economy and reducing global warming, a national RPS is not only necessary, it is vital.

Essentially, an RPS requires utilities to purchase a percentage of the energy they provide to customers from renewable sources.  The current energy bill making its way through Congress eases into the process by starting the renewable energy requirement at 6% in 2012 and increasing it steadily over the next decade. The schedule is as follows:
More than half of U.S. states already have RPS requirements of their own and this national schedule would not override those state provisions. In fact, many states today are already meeting the 6% standard proposed for 2012, and in some cases, far exceeding it. What may rustle some feathers among utilities in states without current RPS mandates is the swift progression of the proposed schedule. Moving from 6% to 11% in four years might be tough for states not already in the renewable energy game, especially in the midst of a major economic downturn.

Despite the growing pains associated with a national RPS, it is a requirement for a healthy renewable energy market in the U.S. Across all sectors, from solar to wind to biomass, the renewable energy industry has gained significant market traction, despite inconsistent federal support. But with a national RPS in place the U.S. government can provide the stability the industry needs to achieve economies of scale and mass adoption, which are critical to bringing the costs of renewable energy down and achieving grid parity, the point at which the price of electricity generated by renewable sources is equal to or cheaper than grid power.

The renewable energy industry will still experience growth without a national RPS, but it will be slower.  If America is serious about reducing its use of fossil fuels, it should set benchmarks to meet its goals.

Green jobs have been a particularly hot topic of late, especially in today’s conversations about job creation through the recently passed stimulus bill.  But what is a green job?  Truth is, no one really knows, and the jury is still out in the definition debate.  From a PR perspective, the lack of a definition creates challenges for those wishing to promote green jobs.  Having a clear understanding of what does and does not qualify as green is critical for making strategic outreach decisions.  Companies participating in green job conversations risk making fraudulent claims in an environment where definition changes rapidly.  Understanding the dynamics of the green jobs story may help companies avoid damaging relationships with key stakeholders and audiences.

Many are attempting to reign in this debate and come up with definitions that are general enough to be all-encompassing, but specific enough to be credible.  Critics point out that a lack of what constitutes a green job allows questionable businesses and industries to claim green job creds and potentially greenwash their activities.  This has some of us out there asking, will green jobs become the new greenwash?

Some argue that everyone is too caught up in defining green jobs and instead should just be focusing on creating good jobs, while others feel that only the narrowest definition will suffice to avoid greenwashing.  Kevin Doyle’s two part post at Grist on his findings and reactions from the Good Jobs, Green Jobs conference recently held in Pittsburgh, reveals that current definitions of green jobs focus primarily on jobs in clean energy and efficient green buildings.  Within these areas, specifically jobs in manufacturing and building trades seems to be agreed upon to be the greenest of the green.  But surely there are more green jobs out there than this definition offers us.

Here is my favorite definition so far from the UN’s Green Jobs Report:
“We define green jobs as work in agricultural, manufacturing, research and development (R&D), administrative, and service activities that contribute substantially to preserving or restoring environmental quality. Specifically, but not exclusively, this includes jobs that help to protect ecosystems and biodiversity; reduce energy, materials, and water consumption through high-efficiency strategies; de-carbonize the economy; and minimize or altogether avoid generation of all forms of waste and pollution.”

Until a definition that is both broad enough to be inclusive, yet narrow enough to avoid greenwashing is agreed upon, companies will be reluctant to publicize their green job offerings for fear of public backlash.  Arguably, if the US is to truly shift to a green economy, then all jobs will be green jobs, but until we get there, it is important to understand the definition debate when reaching out to media around your company’s green job opportunities.

For decades, consumers understood that eating foods high in fat had serious health risks.  But it took years of education, standardized nutrition labels and even bans on trans fats before we started changing our ways. Now, we consult nutritional labels on menus, in the grocery store and in recipes before we even think of lifting fork to mouth.

This model of labeling can also be applied to working to reduce global climate change. In the US House, Democratic leaders say they’re planning to take up legislation on a US cap and trade system this year.   The sooner companies move to put carbon labels on products across the spectrum, the better they might fare when Carbon Cap and Trade regulations are eventually implemented.

The concept is pretty straightforward: identify and label the carbon footprint of products and services so businesses and consumers can make informed choices about the carbon impact of their purchases.   And as consumer brands start to adopt this practice, there is downward pressure on suppliers to capture their carbon information and consider reductions as well.  Sort of a trickle down “carbon-omics” effect.

Companies are not only taking an inventory of their carbon emissions throughout their manufacturing process, but they are also being honest with consumers about what their footprint is and plans for reducing it. The great difficulty lies in the execution and standardization of these labels.  Still, a whole host of businesses, advocacy groups and governments are jumping into the effort.  Here’s a look at what they’re doing:

The United Kingdom started forging this path in 2001, with the roll out of the pilot program Carbon Trust and its Carbon Reduction Label. The non-profit is helping a handful businesses become accountable for their lifecycle greenhouse gas emissions including production, transportation, use, and disposal. Pepsico and the UK supermarket chain Tesco are the biggest participants.

In Japan, the Trade Ministry is overseeing an ambitious plan rolling out this year which will require carbon footprint labeling on food packaging and other products – a program the government sees as an integral step in reaching Japan’s stated goal of reducing total carbon emissions by up to 80% by 2050.

In the U.S., the Carbon Fund and the Climate Conservancy are doing similar work and California has its own Carbon Labeling Act of 2008 working to “establish a methodology for determining and communicating the carbon footprint of a consumer product[s]”. Other countries such as Sweden and South Korea are working on their own carbon labeling systems, all based on similar philosophies, but with different visual approaches.

Until enough time has passed and enough labels are out there to educate the public and have meaningful data to evaluate, carbon labeling will do more to help companies become aware of their own carbon footprints than sell more products.

But that’s ok: All new ideas with no benchmark go through cycles of trial and error. It took over five different automobile models to get the pedal and shifting layout we’re so accustomed to today (thank you Top Gear ), so there’s no reason carbon labeling should be any easier.

The day will come when companies will have to account for their carbon footprints and those that do it early are likely to have a competitive edge. However, carbon labels on their own are not going to reduce carbon emissions to the levels needed to stem the effects of climate change, but they can be used as a tool to raise awareness and help implement larger regulation. Just as in the calorie debate, it took bans on trans fats to drive industry to be more transparent about what’s in our food, carbon fat isn’t much different.

I was struck a few weeks ago by an atypical article in the Wall Street Journal – “The Return of Captain Planet.”

The children’s cartoon from the early 90s was indeed nostalgically familiar, as the green-haired eco-hero with a signature mullet was easily a personal favorite as a child. I had previously been stumped at the show’s vanishing act from the public sphere – in this era of compilation DVDs, rabid online fan communities, and ubiquitous streaming video available, how had the show never made a come back? So while thrilled the show was going to be available again, I had to wonder – is this really Wall Street Journal material?

Working with a reporter at the Journal on another story at the time, I was acutely aware of the publication’s need and desire to cover major, breaking news of global relevance to large, billion dollar markets. Did Captain Planet really meet this threshold?

Turns out, my musing as to the illogic of a show as popular Captain Planet, which based on a very un-scientific polling of my friends and compatriots was easily one of the most loved cartoons of the 90s, not having made a resurgence was apt, and allowed the Journal to explore serious marketing trends – how the nostalgia factor can mean big bucks for past brands (something Sony was trying to capture with other shows) and the power of social networking communities to build audiences.

We always advise clients who want coverage in the Journal to offer an exclusive angle or large financial numbers and specific details around deals and market opportunities. However, the trend story is a tried and true method, allowing a journalist to explore several important market changes simultaneously. Tapping into this is PR at its best.

So while I may not be linking any of my clients up with Captain Planet anytime soon, it’s a strong reminder of the power of the trend pitch.

It’s great to be part of the solution.

As jobs disappear, the economy contracts and the climate continues to warm, Antenna’s renewable energy and clean technology clients are consistently recognized for bucking the trend.

Governor Perdue speaks to the Georgia Legislature in his State of the State address.

This week, Georgia Governor Sonny Perdue recognized Antenna client Suniva in his annual State of the State address.  Suniva recently opened its first solar cell manufacturing facility in Georgia, and plans to create over 100 local manufacturing jobs in 2009 alone.

Governor Perdue highlighted Suniva as part of the state’s successful effort to attract renewable energy companies, stating, “(Georgia’s) efforts have been rewarded with $2.4 billion of investment over the last two years.  That investment means new jobs for Georgians. In November, Norcross-based Suniva, birthed right here in one of our research universities, began fabricating the most advanced solar technology in the world.”

Governor Perdue tours Suniva’s solar cell factory in December 2008 and speaks at its opening ceremony.

John Baumstark, CEO of Suniva, in a statement following the address said, “We were honored to be recognized in the Governor’s speech as a stand out in the renewable energy sector, bringing new technology and industry to Georgia.”

John Baumstark atop the Georgia Tech Aquatic Center in Atlanta.

Baumstark added, “With the help of sound economic policies from the Governor, we plan to build upon our many early successes and continue creating jobs here in Georgia in 2009 and beyond.”

It’s that sentimental time of year again – the holidays are the natural time to take stock and be grateful for all of the good in life and appreciate those who bring joy to the world.

Cleantech, an industry that is not only experiencing growth, but also one that creates a win-win situation for seemingly long-time rivals – big business and the environment, has much to express gratitude for.

Cleantech is particularly grateful for:

* The priority environmental well-being has taken: from business decisions to government policy, investment choices to consumer behavior.

* All the ingenious and hard-working scientists, technologists and visionaries who without their superior skills, innovative spirit and undying determination, the technologies that could shape our future might have remained a passing scribble on a scrap of paper.

* Investors and entrepreneurs, perhaps the most important group in shaping the cleantech industry, taking innovative ideas out of the labs and turning them into the promising companies of the future.

* The US government, which rejoined the global renewable energy movement with the extension of the renewable energy ITC (Investment Tax Credit). This gave renewables, and especially the solar industry, a policy framework from which to build business models and plan future projects.

* The rising, fluctuating and generally unstable energy prices that expose how vulnerable the US is as it continues to remain dependent on fossil fuels rather than properly utilizing its abundant domestic renewable energy resources.

* Everyday people implementing energy efficiency in their homes and lifestyles.  This has caused a drop in home energy use, in some areas of the US, for the first time in 40 years.

* Influential thought leaders like Al Gore (and yes, even surprising allies like T. Boone Pickens) and cleantech advocates who generate awareness of climate change’s devastating consequences and inspire those who have the power to mitigate those negative impacts.

* And most importantly, Mother Earth for her mysterious beauty, munificent hospitality and endless solutions to all of humankind’s wants and needs.