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Economy & Business

St. Louis companies look to go green with clean tech

This article first appeared in the St. Louis Beacon, July 31, 2008 - Tim Gray considers himself to be an environmentalist, one who believes that being "green" is good for business as well as for the environment.

"I think helping people to be more green, by saving them money, is a very powerful way to help change the country for the better," says Gray, who as chief executive of St. Louis-based Waste Remedies LLC helps his clients cut waste.

With all the interest in anything green, thanks in large part to rising fuel costs, venture capitalists are  looking more closely at companies, like Waste Remedies, which specialize in "clean tech" -- technology aimed at developing alternative energy, reducing pollution or promoting conservation. 

Across the country, investments by venture capitalists - individual investors or investment funds that finance start-ups or small companies with huge growth potential - in clean tech have quadrupled from 2002 to 2007, increasing from $755 million to $2.85 billion, according to the National Venture Capital Association.

Since Gray bought Waste Remedies in 2006, helped with $8.5 million in financing from Clayton-based venture-capital firm Advantage Capital Partners and Southwest Bank of St. Louis, the company has grown, with revenue of $8.93 million in 2007, up from $3.3 million in 2006. Gray projects revenue of $15 million this year.

Venture capital can be used for any number of purposes. At Waste Remedies, the venture capital investment bought out the previous owners and funded expansion, Gray says. The firm also hired more people and invested in new information technology. "We certainly plan to grow," Gray says.

The 13 employees at Waste Remedies identify areas where their clients can save, doing everything from gathering satellite imagery and architectural plans for further study, to placing sensory technology on the client's waste equipment.

The sensory technology, for example, makes sure that a trash truck does not make unnecessary stops when a client's waste bins are not yet full. Other recommendations might be as simple as advising a client to use a waste compactor. When waste is compacted, it takes up less space on a truck, saving clients money.

Waste Remedies saves its clients an average of 30 to 50 percent of their expenses, Gray says. "The environmental benefits of what we can do for our customers, as well as what we can save them, is a message that really resonates at the moment."

Gray presented his company's business model to venture capitalists at the InvestMidwest Venture Capital Forum held in St. Louis earlier this year. Out of 20 presenters at the forum, 12 clean tech companies from across the Midwest participated.

Four of the companies were from the St. Louis region, including Crestwood-based Gridlogix Co., a designer of software to integrate all of a building's automated systems into a single information source, providing real-time data to improve energy efficiency.

Gridlogix, started in 2002, has not received any venture capital funding yet, says its president, Carter Williams. The company employs 25 people.

"It's always nice to be able to find more capital," Williams says. He declines to give out revenue or customer numbers for Gridlogix. But he says the company is growing and has customers "on a worldwide basis from Missouri to Dubai."

Mike Heesen, president of the National Venture Capital Association, says that despite the current turmoil in the financial markets, venture capitalists remain interested in clean-tech companies. Many venture capitalists, who have spent the past two years investigating different clean-tech companies, will soon start to invest money.

"What you've seen is a lot of kicking of tires," Heesen says. "Now I expect actual money to go into these companies."

St. Louis companies might receive some of the funds from venture capitalists looking to finance clean tech, Heesen says, citing the region's strength in agribusiness and growing biotechnology sector.

"You can see St. Louis putting a stake in the ground and being able to participate in this very new area of venture investment," Heesen says.

Brian R. Hook is a  freelance writer.

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