U.S.-Israeli outfit greases wheels of nano commercialization

Feb. 15, 2005 — Back in 1992 a team of researchers at the Weizmann Institute of Science in Israel was looking for a technology to convert solar energy into electricity. What they found instead was a substance that was an excellent lubricant; had great shock absorbing powers, and was an efficient semiconductor.

Today, a U.S.-Israeli startup, ApNano Materials Inc., is commercializing that serendipitous discovery. The substance was inorganic fullerenes, nanoparticles of tungsten disulfide or similar materials with a unique spherical structure and a diameter of less than 100 nanometers. The goal is to construct a pilot manufacturing plant, which will produce 150kg a day of the company’s first product, NanoLub, a nanotechnology-based solid lubricant which the company says significantly improves the performance of moving parts.

In late January, ApNano announced it raised $5 million in its second round of financing from European private investors, which will underwrite the manufacturing build-out. The company maintains its corporate office in New York and its research in Rehovot, Israel.

Initial market opportunity in lubrication

NanoLub particles have a unique structure of nested spheres that lubricate by acting as miniscule roller balls. The company says millions of nano-size spheres placed between metal moving parts reduce friction more efficiently that fluid lubricants.

The benefit, says Menachem Genut, president and chief executive officer, is that it “minimizes wear for smooth operation, saves maintenance costs and greatly improves overall machine performance.”

It also reduces energy consumption and decreases air pollution, he said. Typical applications of NanoLub include gearboxes and joints in vehicles and trucks, maintenance-free systems like those used in aerospace, and ultra-clean manufacturing environments such as semiconductor fabs. Other applications include power plants, heavy equipment, machinery, and marine applications.

The company recently developed, in cooperation with the tribology laboratory of the Holon Academic Institute of Technology in Israel, a technique to apply the nanoparticles during manufacturing.

Beyond lubrication, back to semi roots

Although the company found its initial commercial opportunities in lubrication, it never lost site of its semiconductor roots. ApNano is developing a new kind of inorganic nanotube for use in products such as advanced generation high-resolution flat panel displays and atomic force microscopes.

And the company has even found a potential use in security applications. In tests performed by the physics departments of the Universities of Sussex and Nottingham, ApNano’s materials withstood projectiles fired at a speed of 1,000 meters per second, and pressures of up to 210 tons per square centimeter. As a result, the company is looking into producing material for personal safety equipment such as helmets and bulletproof vests.

Sizing up the market

“ApNano Materials is still in the R&D phase…” said Aharon Feuerstein, chairman and chief financial officer. The new financing “will allow it to start production and reach positive cash flow based on sales of product within about two years.”

The company estimates the overall market for lubrication products is worth $2 billion to $3 billion per year. And the company estimates the market for inorganic nanotubes in electronics, composite materials, fuel cells and catalysis at $750 million and likely to grow once further products are demonstrated.

The company says it is negotiating an additional $1 million investment, which would complete the recent second round of financing at $6 million and at a post-money valuation of $22 million. An April 2002 first round of funding previously raised $3 million.


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