I forgot to attach the following article from Crain's Chicago Business to my previous response, it is the source for my numbers. It also answers additional questions posed here, i.e., why focus on cosmetics (because there's $ to be made, quickly).
TT
Three cork-stopped vials hold a prominent place in Bob Cross'
modest Burr Ridge office. The powders within-which look like salt
and cayenne pepper-would become invisible to the naked eye should
the bottles break and the contents scatter.
Though made of ordinary stuff-aluminum, titanium and iron oxide-the
powders took on extraordinary properties when vaporized using a
technique patented by Mr. Cross' privately held company,
Nanophase Technologies Corp.
Nanophase has great expectations for the microscopic particles its
process creates. They already are in some cosmetics. By next
summer, they will be in many sunscreens.
Within five years, they may be in everything from diesel engines to
dentures.
By that time, according to the company road map, Nanophase
Technologies will have grown from a file folder in a research
laboratory to a publicly held company with $100 million in revenues.
''And that's just the beginning,'' says Mr. Cross, president and CEO.
Nanophase is just on the cusp of that success, but it's story is
compelling already: the tale of a promising company that grew from an
esoteric research breakthrough, helped along by shrewd venture
capitalists, of a CEO with a reputation for getting things done and of
two government technology programs now in danger of extinction.
The ''nanostructured'' metals in Mr. Cross' vials would disappear if
released because each particle measures one nanometer-one-billionth
of a meter and one-thousandth the diameter of a human hair. The
ultrafine, uniformly shaped nanostructured materials suggest a tempting
array of commercial applications.
They spread so evenly that they are valued for cosmetics and lotions.
Iron oxide-the most common coloring agent in cosmetics, such as
cheek blush-won't cake or streak in nanostructured form. Titanium,
already used in sunscreens for its light-diffusing properties, provides a
higher protection level in nanostructured form, reducing the need for
chemical colorants that make the lotion white.
And nanostructured materials' fine, evenly distributed particles make
industrial ceramics that are easier to mold, stronger and more
heat-resistant.
Until quality nanostructured materials could be mass-produced, these
products were pipe dreams.
The first breakthroughs came in the late 1980s in research laboratories
around the country, including Argonne National Laboratory near
Lemont. Researchers there secured a patent on their technique and
formed a company to take their discovery to the marketplace.
They had the method. Now, they needed money.
Illinois' Technology Challenge Grant program, designed to foster
technological advancement and economic development, provided it:
$430,000 in crucial seed money in 1989.
More important, the recognition attracted private venture capitalists,
including Chicago-based Batterson Johnson & Wang Venture
Partners, a fund known for backing promising high-tech
startups-including Vienna, Va.-based America Online Inc. and Mount
Prospect-based Illinois Superconductor Corp.
''It's just impossible for a company like Nanophase, which has a
good but hard-to-understand idea, to attract the early money.
Government grants are invaluable in that regard,'' says Steve Lazarus,
former president of Arch Development Corp., the technology transfer
venture of Argonne and the University of Chicago.
Chicago-based Arch was instrumental in helping Nanophase obtain
the state money and, several years later, a three-year, $1-million
award under the U.S. Department of Commerce's Advanced
Technology Program (ATP).
The federal research grant teamed the fledgling company with
Peoria-based Caterpillar Inc., which wanted nanostructured ceramics
for its diesel engines, and Calabasa, Calif.-based Lockheed Corp.
Those links represented a crucial milestone on the road to being taken
seriously.
''Without the ATP grant, Nanophase would not exist today,'' says
Mr. Cross, who recently testified before Congress in favor of the
program, which has been targeted by Republican budget-cutters.
The Illinois program also has suffered since Nanophase received its
award: Funding has dwindled to $600,000 annually from $20 million.
By the time Nanophase's ATP grant expired in June, the team had
gone from producing 1 gram of nanostructured powder a day for
$1,000 to production capacity in tons-with 1 gram costing less than 10
cents.
As the company moved closer to a commercial market, it needed a
new CEO. It got Bob Cross, whose career has included working as
Ross Perot's ''chief trouble-shooter,'' recruiting staff for the Nixon
administration and playing a pivotal role in the creation of America
Online. He joined Nanophase three years ago.
It was Mr. Cross' decision to concentrate on cosmetics applications
first, because they would turn the quickest profits. ''We have to prove
ourselves,'' he says.
To that end, Nanophase has signed a contract with Rona, the U.S.
subsidiary of Germany-based Merck KGaA. Rona already has begun
marketing Nanophase's products to cosmetics suppliers, and says it
will have the company's products in many sunscreens by next summer.
''This is a qualitatively different product,'' says Jane Hollenberg,
Rona's technical director.
So far, Rona is the only company that's signed with Nanophase. And
the cosmetics applications are the only ones that are in the market-or
near it.
But Nanophase has a plethora of irons in the fire.
Besides ongoing research with Caterpillar and Lockheed, the
company is talking with denture makers, fabric treaters and a company
that writes on food with edible ink. Last week, Nanophase
representatives visited with Moline-based Deere & Co., which
''expressed serious interest,'' Mr. Cross says.
''But that's all down the road.'' he adds. Not too far down the road,
but not today.'' . |
