There are several fundamental needs to consider when transitioning nanotechnology discovery into a business and, ultimately, the marketplace. These needs include steady cash flow, market focus, the right pool of skills, correct timing, and adequate funding. Developers of a nanotechnology business must establish a steady flow of fiscal resources. A mix of government and private funding can support the research phase, where the level of funding can remain slow and steady. However, a more public approach is required to accelerate the business growth phase. For example, Nanophase Technologies Corporation had venture capital support for over five years until our capabilities matured and markets were identified, justifying an IPO to acquire the capital needed to grow the business.
A nanotechnology business must also develop a marketing plan. The business must critically evaluate and qualify potential markets, identify lead customers within each market, and develop a business strategy for successful market penetration. For instance, Nanophase offers engineered solutions to meet customers' specific requirements.
The correct skill set establishes the right chemistry for success. Once potential markets are identified, all functional areas must merge — including research and development, process engineering, and business development functions — to collectively determine how core technologies can serve multiple commercial markets, how to improve and evolve the company's manufacturing technologies, and how to develop new nanomaterials and applications that provide value to current and potential customers. Nanophase chose to initially focus on applications where nanomaterials improved existing products (i.e., cosmetics and coatings) because these applications typically have a shorter time to market. However, as we discover market needs, our development focus is shifting to enable products such as CMP. Nanophase has learned that nanomaterial solutions not only provide improved performance, but also, in many cases, lower overall system costs.
Timing of both the business plan and research and development activities is critical. The duration of the research phase is unpredictable, whereas the growth of a business is much more controllable once opportunities are identified. The key is to balance execution between sales, scaling processes to meet customer needs, and developing new solutions. Integral considerations for turning an idea into a commercial product or service also include a keen sense of the marketplace, knowledge of intellectual property, and regulatory considerations for various industries.
Nanophase developed partnerships with established market leaders in order to gain access to international markets. To date, Nanophase has partnerships with BASF, Rohm & Haas, and Altana. These partners have also provided financial support to meet Nanophase's capital requirements. For example, BASF loaned Nanophase $1.3 million to construct a nanoparticle surface treatment facility.
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Fowler Hall, Purdue University