By Candace Stuart
Small Times Senior Writer

April 8, 2002 — Nanophase Technologies Corp. is a publicly traded nanomaterials company that offers what few of its competitors can: longevity, name recognition and a seasoned service-oriented management team.

But it relies on a limited number of customers for revenues in a market that withers during economic downturns, and has yet to post a profit since its inception in 1989.

“We’re proud of the customers we have, and we love them,” said Joseph Cross, Nanophase’s president and chief executive. “And we want more.”

Cross, the former head of Aegis Technologies and a veteran at turning around


“We’re proud of the customers we have,
and we love them,” says Joseph Cross,
Nanophase’s president and chief executive.
“And we want more.”
startups, beefed up Nanophase’s staff in the late 1990s by adding engineers and experienced businesspeople. He built off Nanophase’s status as one of the industry’s early starters by focusing on partnerships, customer service and applications rather than the technology itself.

The strategy, until recently, nudged the company toward profitability. Nanophase’s revenues soared by almost $3 million in 2000, but for 2001 revenues dropped slightly while losses increased by $1.2 million.

“Last year the company was impacted by a severe recession in manufacturing and retraction,” Cross said. “It hurt revenue growth.”

Nanophase also wrestled with a class-action lawsuit that was settled this year.

Donald Freed, Nanophase’s vice president for business development, said the company is taking a two-pronged approach toward revenue growth. First, it works with potential customers to show how its nanomaterials can improve their products or production processes. Then it customizes its particles to make them compatible with the client’s manufacturing system and materials.

“We don’t want to be a footnote in history,” Freed said. “To be successful you want to do everything right. A company fails because it fails to satisfy the customer.”

Nanophase’s most visible deal is its partnership with BASF AG, which uses zinc oxide nanoparticles in sunscreens. BASF accounted for 68.5 percent of the company’s 2000 revenue.

Nanophase’s goal is to retain its core customers but expand its client base to be less reliant on a few large contracts.

“The general situation is they have lots of work in progress but few success stories,” said Mindy Rittner, a senior industry analyst with Business Communications Co. “They’re working with potential end users. Some will come to fruition and some won’t.”

Rittner, who published three reports on nanomaterials in 2001, projected the world market for nanoparticles will total $900 million in 2005, up from about $493 million in 2000.

Nanophase was spun out from Argonne National Laboratory by Richard Siegel, now a professor at Rensselaer Polytechnic Institute, based on a technique for making nanocrystalline materials. The industry now includes more than 100 players. Being among the first has given the company name recognition and a chance to prove itself, Freed said.

“There’s always an advantage to being the first mover in a field,” he said. “But you have to run like hell. First is not always the winner.”


COMPANY FILE: Nanophase Technologies Corp.
(last updated April 8, 2002)

Nanophase Technologies Corp.

Ticker symbol
NANX (Nasdaq)

Headquarters in Romeoville, Ill., with production facility in Burr Ridge, Ill.
Mailing address:
1319 Marquette Drive
Romeoville, IL 60466

Founded by Richard Siegel in November 1989, based on his research at Argonne National Laboratory.

Nanocrystalline materials

Top products Nanocrystalline metal oxides such as zinc oxide and aluminum oxide

Small tech used
Nanophase has developed a patented Physical Vapor Synthesis process for engineering and manufacturing nanomaterials with enhanced properties.


  • Donald Perkins, chairman of the board
  • Joseph Cross, president and chief executive
  • Daniel Bilicki, vice president for marketing and sales
  • Gina Kritchevsky, vice president for technology and engineering
  • Richard Brotzman, vice president for research and development
  • Donald Freed, vice president for business development
  • Employees:

    Annual: $4,039,469 for FY 2001
    Quarterly: $1,200,000 for Q4 2001. The company has projected revenues of $1,400,000 for Q1 2002.

    Customer awareness: Potential customers need to be shown how higher-cost material can lead to a better end product or production improvements.

    Key competitors
    Nanogate, NTera, Nanopowder Enterprises Inc.. The major chemical companies could offer serious competition if they see reason to enter the market.

    Short-range and long-range goals
    Lower production costs and target near-term and longer-term markets; diversify and grow customer base.

    What keeps them up at night
    Worrying about the national economy and events such as the 9-11 attacks, said Joseph Cross, Nanophase’s chief executive

    Contact information

  • URL:
  • Inquiries: [email protected]
  • Telephone: (630) 771-6708
  • Fax: (630) 323-1221
  • Recent news

  • No nano products for decades? Better go check your beach bag

  • Nanophase workers return to jobs
  • Court approves Nanophase settlement

  • Nanophase launches new nanoparticle


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