First Round Funding Moves Applied NanoMaterials Closer to Production

Applied NanoMaterials, Inc., which commercializes nanospheres and nanotubes of inorganic compounds, has raised $1 million in first round financing from the Newton Technology VC Fund.

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May 30, 2002By Michael Pastore: More stories by this author:
Applied NanoMaterials, Inc., which commercializes nanospheres and nanotubes of inorganic compounds, has raised $1 million in first round financing from the Newton Technology VC Fund.
Along with the initial funding, Newton has an option to invest an additional $2 million in Applied NanoMaterials within 12 months of the original investment.
Applied NanoMaterials, which is headquartered in New York, was incorporated two months ago, but the company's core technology has been under development at the Weizmann Institute of Science in Rehovot, Israel, for nearly a decade.
"Now it's in a stage where we can commercialize the product," said Dr. Menachem Genut, president and CEO of Applied NanoMaterials. Genut was a co-discoverer of the inorganic nanostructures as a member of Weizmann's Nanomaterials Synthesis Group. Applied NanoMaterials was granted an exclusive license by Yeda Research and Development Co. Ltd, the commercial arm of the Weizmann Institute, to manufacture, commercialize and sell the nanomaterials.
Genut told NanotechPlanet that because his company's nanotubes are inorganic they are much easier to synthesize than carbon-based nanotubes and fullerenes. The inorganic nanostructures are semiconducting, and have what Genut calls "old economy" uses in a broad range of commercial and industrial products, including applications in the microelectronics, semiconductor, aerospace, lubricant and metal-working markets.
As a lubricant, some inorganic fullerene-like structures have shown to be more effective than oil-based liquids with solid lubricant additives. This means less wear and tear on machinery than users get with more traditional lubricants. But while applications of the company's nanomaterials in the lubricant market hold plenty of immediate promise, potential customers from several industries have expressed interest, Genut said.
"We have been approached by large companies, especially in aerospace, where our products have uses," he said.
Several potential customers, whose names Genut could no disclose, have already performed tests with products from Applied NanoMaterials. He called the initial results "encouraging."
Genut told NanotechPlanet that the first round financing, with its option, is enough funding for the next two years, but that doesn't mean Applied NanoMaterials has shut the door on further funding. Genut said the company has already been approached by other VC firms. The initial financing, however, will help the company take a big step.
"By getting this funding, we can get more quickly to production," Genut said.
As for where that production will take place, right now that's an open question. Semi-production is currently done at Applied NanoMaterials' R&D facility in Rehovot, but full-scale production may be done elsewhere. It may also be part of a joint venture with industry, Genut said.