VCs to Nanotech: Don’t Call Us!

Today saw the launch of our new report looking at how VCs around the world are funding nanotech, and it turns out that they aren’t! Despite the hype, we see around 0.14% of US VC money going into nanotech, and an even less significant fraction in the rest of the world.

Should we be worried? Not really. Most of the action in nanotechnologies is related materials, and that is a game for BASF and Dow rather than start ups. Any company producing additives for polymers, or bulk chemicals would find it tough to raise VC funding, whether or not it has a nano in the name.

More encouragingly, we do see an increasing number of businesses taking advantage of these new materials, in ways that they can easily leverage into existing major markets such as health care and energy. While historically VCs have been taking a punt on science projects or ignoring nanotech altogether, we are finally seeing some businesses that will appeal to VCs along their traditional sector specific lines (e.g. biotech, healthcare, energy) which will allow them to make informed judgements about market potential rather than blind guesses.

Comments 1

  1. well I’m not surprised !

    Since most folks who write about nanotech, or newletters have little clue nor experience with any products, nor actual applications/ fabrication or process/ manufacturing related business strategy, most NANO news is merely amusement for the writers and the Computational Nano folks.

    Folks who make pretty drawings about molecular this and that, often are clueless about how to make their creations (ie visions on their screens and in their minds), and mere conjecture hardly confers any useful credibility nor business potential to VCs.

    Practical nanotech often does not catch the fancy of the writers, and yet it is IMPORTANT. Yet just because you can make a nanotube device, or even grow a nanotube has little commercial significance – and typically no real promise outside of scientific publications. There are exceptions but they are few and far between.

    IE there is a lot more noise than there is substance in the blogosphere and press release realm.

    The closest Nanotech WIN is likely Nantero, making deep submicron NRAM – a mems like nanotube non volatile memory with crossed mats of tubes, not a single pair of mnanotubes as originally envisaged…and they won’t ship till next year.

    Practicality and value added, do matter.

    Another firm doing modestly well – is Evident technologies – a slogger, with $1.5m annual revenues and chugging away at applications innovation, and likely a transition to nanoparticles that will comply with ROHS – ie reducing eliminating heavy metals in the nanoparticle based products.

    But so much that gets put in the press or analyst research reports is almost like internet bubble junk – things that don’t matter, or cannot be made despite claims to the contrary, or are just unprofitable to make (business issues do matter)…

    THATS WHY …..

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