Nanotech Investing - Part II
Opportunity only knocks once, and this is what nanotech investors have been waiting for.
This is a continuation of Part I, published on Stockhouse.com on
When the bottom in “small technology” (nano, MEMS, microelectronics, and microfluidics) stocks and private companies comes, we expect you’ll find:
Coatings – good
Catalysts – good
Advanced materials – excellent
Lubricants – good
Filtration – good
Insulation – good
Photovoltaic companies – questionable
Since the nanotech tales of woe, detailed in October 2007, there has been more woe (but you’ll see in Part III there is more than room for optimism, now):
From mid 2007, one single, “unlucky” investment bank raised Arrowhead Research Corporation (NASDAQ: ARWR, Stock Forum) $16.5 million at $5.78 per share with ¼ warrants at $7.06 (it’s now $2.02). They raised Nanophase Technologies Corp. (NASDAQ: NANX, Stock Forum) $10.6 million at $5.92 (now $1.95). Oddly (not), they were unable, for whatever reason (amazed neither the company itself nor the underwriter have yet to release details at this late date), to bring private company, Nanodynamics, public on the Dubai Exchange a few months ago.
Consider more woe: Considered by some a superstar, Nanosphere Inc. (NASDAQ: NSPH, Stock Forum), went public only in early November 2007 at $14 – today $8.82.
Sorry, but this continues a pretty darn bad record for nanotech investing and investments, and you know what they say about those who continue repeating the same activities while expecting different results.
As we’ve been saying and writing publicly since 2004, the “VC to IPO or M&A model” (nothing against VCs) is “broken” (it’s the wrong model) for “small” tech investing, largely because it requires more capital than can be efficiently put to use by these type of companies. A merchant banking model (read the Hambrecht & Quist, Petrie/Parkman, or Allen & Co. model) wedded to the public venture capital stock markets and going public early is a better formula for success.
All that said: We are certainly closer to a long-term bottom than at anytime in the last 10 years, and, properly structured for return on investment, nanotechnology and other advanced tech deals, companies, and stocks will prove incredible investments over the next three to seven years.
Especially when the investments are made at pre-public, private placement valuations.
With these nanotech insights, it is my hope that kindred spirits, including accredited investors, VCs, investment bankers, angel investors, analysts, scientists, hedge and private equity fund managers, high-tech entrepreneurs, public and private “small” tech companies, and family office execs will gravitate toward The Nanotech Company, LLC.
Our vision of using the TSX Venture Exchange to finance and create liquidity for “small” and advanced technology companies and our deep expertise in successful employment of Canadian public venture capital markets are unique.
To be clear: Our firm, supported by our eminent Scientific Advisory Board, is going to be building “small” and advanced tech companies via the TSX Venture Exchange. The main reason we are communicating with this relatively small group and fraction of our list of Nanotechnology.com subscribers is that some of the “accrediteds” among you may have the opportunity to participate at a ground-floor stage in these investments and others may assist us in growing this process.
Again, opportunity and history knock only once.
Patience pays off. Valuations are down. Money is tight. Success stories have been few.
This is what we have been waiting for. What a great time to be a nanotech investor.
Part III to follow shortly.
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