Today in Biofuels Opinion: “They didn’t think of the risk. Who thought corn would go from $2.20 a bushel to $9? You better make sure that when you build the business itself, you’ve got a way to mitigate the risks of that bubble.”

Solazyme CEO Jonathan Wolfson in SFGate: Q: Corn ethanol plants have closed across the country, due to oversupply and big swings in the price of corn. What can you learn from their experience? A: They didn’t think of the risk. Who thought corn would go from $2.20 a bushel to $9? You better make sure that when you build the business itself, you’ve got a way to mitigate the risks of that bubble. Q: You’ve tested your product, but you haven’t ramped up to full production. In this kind of credit market, can you get the money to build a factory, or do you need to keep leasing space and equipment?
A: Any time you need to build a first-of-its kind facility, it requires an extra level of comfort (for the financiers). So even if the credit market was working, we’d have a challenge. We need to have a rational path forward, and for us right now that means leasing commercial-scale facilities.”

From Business Insider: “Speaking at the ECO:nonomics conference yesterday, John Doerr, Vinod Khosla, and Bryant Tongall said they’re not interested in backing any companies working on algae biofuels…For Mr. Doerr of Kleiner, Perkins, Caufield & Byers, the problem is algae itself. To get better economics, you need to grow the stuff in cheap, open-air ponds, not in fancy bioreactors. But that is rough on algae and limits yields. Mr. Tongall, of Nth power, says both the economics and the timeline of algae biofuels are still ugly at this point. Mr. Khosla adores liquid alternative fuels, like ethanol. He told a big biofuels summit last October that he “believe[s] in the potential of algae.” But he hasn’t invested in algae so far because it fails his cardinal rule: economics.”

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