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Feb. 24, 2003 — In the race to take nanomaterials to market and make a profit, Nanomix Inc. believes it is the leader of the pack. The Emeryville, Calif.-based builder of carbon nanotube structures apparently hasn’t missed a beat since the departure in January of CEO Charlie Janac.
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Company executives won’t discuss Janac’s departure and say there are no current plans to appoint a successor. “We still want to put our mark on the world with nanotubes,” board member Alexander Wong is quick to point out.
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Nanomix currently is focused on producing chemical and gas sensors, components that are used in medical diagnostic, industrial safety and process control applications. The size of the market is estimated at $2.5 billion.
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The timing of Janac’s departure raised eyebrows because it came when the company is flush with new funding. In September of last year, Nanomix closed $9 million in new investment. Lead investors in the Series B financing were Apax Partners, where Wong is a partner, and Sevin Rosen Funds.
According to Jeff Wyatt, Nanomix’s director of business development, the company’s ability to capture new financing at a time when venture capital activity has all but dried up made headlines. “More than anything else, what put us on the map in the later half of 2002 was closing a $9 million investment round,” he said. “It’s not all that common these days.”
Alta Partners, a leading San Francisco venture capital firm, funded the company’s launch in September 2000. It was founded by University of California, Berkeley physics professors Marvin Cohen and Alex Zettl to develop and commercialize nanotechnology breakthroughs. When Janac joined the firm in the fall of 2001, he focused Nanomix on producing devices for two specific markets — chemical sensors in the near term, and hydrogen storage systems in the long term, a far more lucrative market.
The company is banking on what it believes to be a compelling business plan and a great scientific team to beat competitors to market. One of its closest competitors is Palo Alto, Calif.-based Nanosys Inc., which is developing a competing method to improve the accuracy and speed of sensors.
According to Wyatt, the company plans to do beta testing of two of its chemical sensors by the end of this year. About 100 prototypes of the sensors will be put in customers’ hands “so they can shake them down and tell us what’s wrong with the device,” he said, adding that product rollout is expected in 2004.
What makes the company attractive to investors is its long-term platform potential with profitable short-term products along the way, Wong said. “Apax chose Nanomix because it has a disruptive technology that could change the world,” he said. “We like the combination of a leading edge nanotechnology with a strong focus on product development.”
It appears to be a smart combination, said Marc Rothchild, a senior analyst at San Francisco Consulting Group. “The fact that they chose to initially target the sensor market shows they have a plan to get short-term revenues,” Rothchild said. “It focuses them on an application that can make them money in the next few years.”
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Company file: Nanomix Inc.
(last updated Feb. 24, 2003)
Company
Nanomix Inc.
Headquarters
1295 A 67th Street
Emeryville, Calif. 94608
History
Incorporated in September 2000 as Covalent Materials, Nanomix uses technology based on the research of co-founders Marvin Cohen and Alex Zettl, both physics professors at The University of California, Berkeley. Cohen is a National Medal of Science winner. The company changed its name to Nanomix in April 2002.
Industry
Nanomaterials
Employees
24
Small tech-related products and services
Nanomix is exploring the use of carbon nanotubes as the building blocks of new materials. The company has developed proprietary methodologies for the synthesis of nanomaterials. In using these materials, Nanomix is targeting the development of hydrogen storage systems and chemical sensors, with the latter relevant to medical diagnostics, industrial safety and process control applications.
Investment history
The company received a $4.5 million first round of funding in September 2000 from Alta Partners (round leader) and individual investors. In April 2002, bridge funding from the same participants garnered Nanomix $900,000, and in September 2002 the company picked up $9 million in second round funding from Apax Partners (round leader) and Sevin Rosen Funds, as well as North Star Equity, EnerTech Capital Partners, Alta Partners and individual investors.
Barriers to market
Besides functioning for the moment without a CEO’s leadership, Nanomix is also working in a niche crowded with competitors.
Selected competitors
Goals
In the short term, Nanomix is targeting the sensor market with nanotube-based devices, which it believes has superior price/performance characteristics compared to traditional technologies. Nanomix’s initial products will address chemical detection for industrial applications such as oil and gas refineries. In the long term, Nanomix’s goal is to be a leader in nanotube-based products in electronics, energy and life sciences markets.
Why they’re in small tech
“We think that the recent advancements in small tech will trigger multiple waves of innovation, and we believe that Nanomix’s technology platform will play a significant role,” said Jeff Wyatt, the company’s director of business development. “Nanomix’s expertise in multiple facets of the technology including computation, materials synthesis, chemistry and product engineering gives us a unique platform from which to address the large markets that will be impacted by this revolution.”
What keeps them up at night
“The exhilaration of constantly breaking new ground does lead to some late nights,” Wyatt said.
Relevant patent
Method for making nanotubes and nanoparticles
Recent news and publications
Nanomix loses high-profile CEO
Nanomix wants its name to be synonymous with nanotech success
Contact
Research by Gretchen McNeely