“Not bad, eh?” he says, betraying the hint of a Canadian accent. “And listen to the engine. Because it’s electric, you can’t hear a thing.”

A compact man with greying blonde hair and a piercing gaze, Salzman exudes coiled energy. Back at his office headquarters, he leaps out of the car and flips the hood, revealing a battery and some wiring. “And check this out,” he says enthusiastically, opening a flap on the side. There’s a plug-in socket where the gas cap should be.

The Tesla is one of a long list of technological breakthroughs Salzman has helped finance. With about US$4.5 billion raised since its founding in 1996, his venture fund, Vantage Point Venture Partners, has seeded everything from the MySpace social networking site to Bright Source Energy, builders of utility-scale solar-power plants, to Pure Digital’s Flip Video camcorder — which earned an estimated US$150 million in revenue last year.

Few tech companies tap equity markets these days, but Salesman isn’t fazed. This year, his fund is betting a billion on clean technologies. Its most audacious new investment is Shai Agassi’s Better Place, a Palo Alto, Calif.–based startup that aims to supply infrastructure to power the electric car around the world.

Salzman, a former Torontonian, wants nothing less than to transform what we drive — and where we get the energy to drive it. In decidedly un-venture-like fashion, he’s partnering with blue chips, utilities, even governments, in order to do so. He breezes past naysayers with the simple argument that fossil fuels are finite, so finding alternatives isn’t a dream — it’s an inevitability. But venture capitalists aren’t known for their love of government — or Corporate America. In transforming transport and energy, Salzman will also be transforming himself.

Alan Salzman grew up in Toronto. He dreamed of becoming an international lawyer, but no such program existed in Canada. So after a year at the University of Toronto, he crafted his own program at schools in London and Brussels, as well as Stanford University in Palo Alto, Calif. He graduated in 1978.

After stints in Europe and New York, in 1982 Salzman took a job with one of San Francisco’s most respected lawyers, John Larson of Brobeck Phleger and Harrison. Sensing the wealth-creating potential of Silicon Valley, Larson asked him to set up a division in Palo Alto, catering to high-tech. Salzman ended up representing the likes of General Electric’s venture arm.

In 1987, then GE chief executive Jack Welch cut the division. So Salzman and a few partners bought it for US$40 million. They raised another US$100 million of fresh capital, then started to fund health-care and IT plays — Matrix Pharmaceuticals, a cancer drug company, was his first investment. Salzman co-founded VantagePoint in 1996.

By October 2003, VantagePoint had picked up what’s estimated to be a 22% stake in MySpace for US$15 million; the company was later sold to NewsCorp for about US$600 million. Today, VantagePoint is one of Silicon Valley’s largest funds.

The investment ethos Salzman lives by is simple. “We are looking for products or projects that are seeking to transform their industries or their markets,” he says. Failure is inevitable, Salzman acknowledges. “But as long as, every now and then, we create a new industry or innovation that everybody adopts, it works out.”

Like most VC firms in Silicon Valley, VantagePoint went through tough times in 2002, in the aftermath of the tech boom. That’s when clean technologies first piqued Salzman’s interest. Together with managing director Stephan Dolezalek, he started thinking: What industries hadn’t yet gone through a major transformation? “We came up with energy, water, transportation and materials,” Salzman says.

Salzman and Dolezalek adopted the term “clean tech” to describe their new focus. But they quickly discovered tackling these sectors meant playing in a whole new league. “The submarkets are enormous,” Salzman says with more than a hint of marvel. “Transportation is a multi-trillion-dollar industry — and that’s just a subset of energy. We realized we couldn’t do it on our own.”

Source: Canada Business