Nanotechnology Start-up Companies

Nanotechnology start-up companies should not expect to defy fundamental business principles, as did the Internet companies of the mid- to late 1990s, if only for a brief period. Nanotechnology companies should expect to be measured by standard metrics and to confront the same industry dynamics and fundamental business issues (for example, personnel choices, sales strategy, high-volume manufacturing, efficient allocation of capital, marketing, execution of their business model, time-to-market challenges, and so on) that face the other companies in their relevant industry category.

Certain key characteristics often differentiate nanotechnology start-up companies. They possess a technology platform with a body of intellectual property and a team of scientists, but no formal business plan, product strategy, well-defined market opportunity, or management team. Second, they are founded by (or are associated with) leading researchers at top-tier academic institutions. They employ a financing approach that highly leverages equity financing with the application of grant funding, and they need to have a more scientifically diverse workforce than other start-up companies.

It is common for these companies to employ chemists, physicists, engineers, biologists, computer scientists, and materials scientists because of the interdisciplinary nature of nanotechnology and the unique skills and knowledge that are required for product commercialization. Moreover, nanotech companies tend to sign up development partners (usually larger, more established companies) early in their maturation to provide technology validation and additional resources in the form of development funds, access to technology, sales and distribution channels, and manufacturing expertise.

Nanotechnology start-up companies can best be classified into six primary categories: nanomaterials and nanomaterials processing; nanobiotechnology; nanosoftware; nanophotonics; nanoelectronics, and nanoinstrumentation. Many companies in the nanomaterials category are developing methods and processes to manufacture a range of nanomaterials in large quantities as well as developing techniques to functionalize, solubilize, and integrate these materials into unique formulations. A variety of nanomaterials will ultimately be integrated into a host of end products (several are on the market) that will provide unique properties, such as scratch resistance, increased stiffness and strength, reduced friction and wear, greater electrical and thermal conductivity, and so on.

The three areas that have received the most funding based on dollars invested are nanoelectronics, nanophotonics, and nanoinstrumentation. However, in terms of the absolute number of companies that have been funded, nanomaterials companies are the clear leader.

Nanobiotechnology is the application of nanotechnology to biological systems. Applications exist in all of the traditional areas of biotechnology, such as therapeutics discovery and production, drug-delivery systems technologies, diagnostics, and so on. Incorporating nanotechnology into biotechnology will lead to the enhanced ability to label, detect, and study biological systems (such as genes, proteins, DNA fragments, single molecules, and so on) with great precision as well as to develop unique drug targets and therapies.

Nanoelectronics is based upon individual or ordered assemblies of nanometer-scale device components. These building blocks could lead to devices with significant cost advantages and performance attributes, such as extremely low power operation (~nanoWatt), ultra-high device densities (~1 trillion elements/cm²), and blazing speed (~1 Terahertz switching rates). In addition, the possibility exists of enabling a new class of devices with unique functionality. Examples include, but are not limited to, multi-state logic elements; high-quantum-efficiency, low-power, tunable, multicolor light-emitting diodes (LEDs); low-power, high-density nonvolatile random access memory (RAM); quantum dot-based lasers; universal analyte sensors; low-impedance, high-speed interconnects, and so on.

Nanophotonics companies are developing highly integrated, subwavelength optical communications components using a combination of proprietary nanomaterials and nanotech manufacturing technologies, along with standard complementary metal oxide semiconductor (CMOS) processing. This provides for the low-cost integration of electronic and photonic components on a single chip. Products in this category include low-cost, high-performance devices for high-speed optical communications, such as wavelength converters, tunable filters, polarization combiners, reconfigurable optical add/drop multiplexers (ROADMs), optical transceivers, and so on.

Nanoinstrumentation is based on tools that manipulate, image, chemically profile, and write matter on a nanometer-length scale (far less than 100nm). These tools include the well-known microscopy techniques such as transmission electron microscopy (TEM), scanning electron microscopy (SEM), and atomic force microscopy (AFM), as well as newer techniques such as dip-pen nanolithography (DPN), nanoimprint lithography (NIL), and atom probe microscopes for elucidating three-dimensional atomic composition and structure of solid materials and thin films. These are the basic tools that enable scientists and engineers to perform nanoscale science and to develop nanotechnology products.

Nanosoftware is based on modeling and simulation tools for research in advanced materials (cheminformatics) and the design, development, and testing of drugs in the biotechnology industry (bioinformatics). This category also includes electronic and photonic architecture, structure, and device modeling tools such as specific incarnations of electronic design automation (EDA) software or quantum simulations, and so on. In addition, one might further include proprietary software packages developed to operate nanoinstrumentation-based tools or interpret data collected from such instruments.