Greenbacks.

Environmental e-companies hold investment promise.

SILICON VALLEY VENTURE CAPITALists are renowned as astute business people who know where to invest millions to earn billions. But their mania to fund dot-com start-ups may have blinded them from financing an industry many believe is about to explode: "green businesses," or environmental friendly companies.

That emerging industry "will overshadow the Internet by many leagues within the next 10 years," predicts Rona Fried, president of SustainableBusiness.com, a New York-based Web site that brings investors and entrepreneurs together with green start-ups. "Venture capitalists are beginning to flock to them. But it seems to be a big secret in the Silicon Valley."

The pitch for a green-industry takeoff goes something like this: As natural resources become increasingly scarce and polluted, as the ozone hole widens and global warming wreaks havoc on worldwide economies, an aroused citizenry--THAT'S US--will demand that corporations, farms, offices, factories, shops and houses stop their business-as-usual methods or be legislated or fined into non-existence. First-movers to renewable energy, sustainable forestry and agriculture, for waste management and for technologies to clean air and water will be in hot demand, so you better buy their stock now before you miss the next big deal.

"There are several Microsofts waiting to come forth in the clean energy business and we'll all wish we'd had invested in them," says John Palmisano, director of environmental policy and compliance at energy giant Enron International.

And that brings us to Latin America, where venture capitalists--non-Valley, that is--are beginning to fund regional start-ups. "People see it as an environmental hot spot--where there is a lot of rainforest being rapidly exploited," says Fried. "It's an area that is underserved and needs help being promoted."

Not just talk. Obviously, people like Fried are more than available to help promote poor, under-promoted Latin America, hut not all is hyperbole--some of the world's largest firms are already financing cleaner and more efficient technologies. British Petroleum, for example, has made a US$1 billion investment in wind-and solar-energy companies, making it one of the world's largest manufacturers of solar equipment.

New Ventures, a program of the Washington D.C-based World Resources Institute, has created Ecofinance.net as an online tool to help more than 57 environmentally oriented firms in Latin America secure funding and technical assistance.

Norissa Giangola, New Ventures' regional manager, says she has yet to find a Silicon Valley investor but believes they are leery of Latin America's lack of "the cult of the business plan." Of course, Ecofinance.net's Web site offers the online pro bono expertise of business students and retired executives.

Ecofinance.net has already helped find financing for the first marketing and distributor of organic products in Costa Rica, for the first company to place organic bio-inputs in shrimp to reduce disease and improve production in Ecuador, and for the first sustainable timber business in Guyana.

In Irvine, California, venture-capital firm Ventana Global has invested $30 million in several Mexican environment companies, including those that manufacture technology for solar heating strips, air conditioning systems that do not harm the ozone layer, asbestos abatement and waste management.

Pursuing profit. Ventana founder Thomas O. Gephart says he is "very happy" with his green investments but understands why his Valley colleagues have shied away. "We are all driven by performance. If see that there is a clear trend that we can get a higher return for water, air and recycling, we migrate money to that sector," says Gephart. "But it's not clear yet with the environment."

To be sure, not all investors are from the United States. In Brazil, the Sao Paulo-based Banco Axial, a 3-year-old investment bank, is at the forefront of green investing. Its $15 million Terra Capital fund has already invested in an Amazon plantation growing hearts of palm and in a cranberry farm in Chile. Bank officials plan to raise $300 million more and expect annual returns of 20% to 30% in the next few years.

While those returns sound plenty handsome, Stace Lindsay, the managing director of Explorador.net, a San Francisco-based Latin American investment company, predicts most Silicon Valley investors will continue to be seduced by Internet and telecommunications ventures for the next 18-36 months. That's based partly on the extraordinary pent-up demand for such services in Latin America, and partly on what he sees as the immaturity of many of the green start-ups. But after that, who knows? "We are all waiting for these naturally sustainable companies to develop," he says.

The trick will be for them to develop without the blank checks their Internet start-up peers have enjoyed. But if they can, it may herald some long-awaited good news for the planet.