Filtering out hype to arrive at true value: industry emerges from familiar challenges at innovation adoption.

• Author: Lewis, David
• Position: SPECIAL SECTION

THE CARTHER RYPE CYCLE HAS DEEN AROUNO SINCE 1995, when it helped make sense of what became the Internet bubble.

You know the Hype cycle, it's the pattern of events that follows the invention of a new technology, such as clean technology.

The Gartner Hype Cycle "was originally adopted for technology innovation and companies, but it really is equally applicable for green technology," says Josh Green, general partner of Menlo Park, Calif--based Mohr Davidow ventures.

Greentech has "gone through the classic elements of the hype cycle," Green says. "we went through the hype that created unrealistic expectations of the last seven or eight years and now we have gone down the other side of it, which is what we're experiencing now, which is the trough of disbelief The key at this point is that what ends up happening is, as we say in Silicon Valley, a lot of tourists have left down because it's not so friendly here any longer.

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"As an investor I'd say we're facing some significant headwind," says Green.

Once greentech pulls itself out of the trough, what's next?

"The people who are really stalwarts are continuing to chip away and create true value through creating greater productivity, lower costs and all the traditional metrics of what you find in a really good business." Green says.

Yet, even at this market, there is money to be made.

"I absolutely believe there is." Green says. "An investor needs to know where to look.

"I've been in Silicon Valley for 32 years so I've seen a number of these hype cycles in different industries over that time," Green says. "And when everyone else is losing their Wits around you its most important to hunker down and work on the things that are real important and really valuable. That's true when you're at the...