Wednesday, June 02, 2004

What Would Roger Own? Not Nano

AlwaysOn's Tony Perkins interviews "uber-investor" Roger McNamee, who says he wouldn't touch this technology with a 10-nanometer pole. Here's what McNamee says:

    I'm personally totally uninterested in nanotechnology. And I'm uninterested in it because we were at the earliest phases of the infrastructure. I haven't the faintest idea what the applications are and I'm an applications investor. I'm not a true VC. I'll always be a Series B and beyond. I'm a product person. And I can't even tell you by class what nano-technology is really going to do.

    So I think if you do nanotechnology, you've got to really believe in it, because you're going to be at it 10 or 15 years before there's a real product. And for some of you, that might be the right answer. It just wouldn't be right for me. So I'm not going to make any qualitative statement about the attractiveness of the opportunity so much as it's just a bad fit for my personality. If you're going to be an investor, knowing what's a good fit for your personality I think is fundamental." More here.

As I've written before, nano is only for the brave and the foolish.


Keith Blakely said...

I disagree with Roger's assessment on the timeframe for having products and applications. There are real products today (and no, I am not talking about fumed silica, carbon black, and paint pigments). The nanomaterials space will most likely generate the early entries for commercialization - antimicrobial silver dispersions and ointments, nanosized metal powders for thermal transfer in both solid and liquid media for the semiconductor, microelectronic, and industrial applications, nanosized catalysts (which, incidentally, are probably already in use by one of McNamee's own investments - Plug Power - as part of their PEM fuel cell), nanosized metal powders for internal electrodes in smaller and smaller capacitors, and many, many others. The biomedical field already has products and applications including Elan Pharmaceutical's nanoscale encapsulation technology (recently licensed to Roche), Flamel's coating technology, imaging enhancement nanosized materials for x-ray, MRI, and CAT, along with emerging chemo- and radiation-therapy delivery systems. We've already seen early adopters of carbon nanotubes in the FED arena, including the big players in Korea (Samsung), Japan (NEC), and the US (Motorola). As prices continue to drop for CNTs, the polymer composite, transparent conductive coatings, and drug delivery applications will accelerate - and these are 3 - 5 year opportunities, not 10 - 15 by most estimates.

What is also interesting (and attractive to investors) is that these applications are generally high value and support the use more expensive materials due to the performance enhancement and/or value of the specific end-use, so gross profit margins should be healthy for companies using commercially viable production technologies.

Finally, Howard, I would modify your concluding remark - nano is for the brave and perspicacious (how's that for a $100 word?!), but definitely NOT for the foolish.

Howard Lovy said...

Main Entry: per·spi·ca·ciousPronunciation: "p&r-sp&-'kA-sh&s
Function: adjectiveEtymology: Latin perspicac-, perspicax, from perspicere: of acute mental vision or discernment : KEEN
synonym see SHREWD