Three European Showcases
Marketing nanotechnologies through thecreation of successful start-ups
Dr Hervé André DURAND
AAIPX - “Idea Transformers”
International Technology Strategy & Management Consultants

ContentNano Macro-Economics
 Opportunity and ChallengeHorizontal Nature of Nanotechs
 Peratech



The Biotech Syndrome Si-Light

Commercial Reach NanoSight

Concluding remarks

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

Nano Macro-Economics
 Nanotechnology revolution
 In our opinion the nanotechnology revolution is moreeconomics than technology
 More nano-knowledge in academia than in corporations
Corporate « fundamental research » budgets have been cut for thelast 25 years.
 Corporate R&D focus on short to mid-term

The pharmaceutical industry is a template: most innovations are developped
externally, then integrated through acquisitions when commercialy mature.

 2005: Inflexion point in Nanotechology budgets

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

Nanotech budgetAn explosion ofbudgets during thelast 10 years

Public spend on nanotechnology
6000
5000

In Cientifica’sopinion, corporate
nano R&D budgets
are catching up withpublic budgets in2005, at over 10B€
annually.

4000($m)3000

RoWUSA

2000

JapanW.Europe

1000

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

E
2005

E
04
2003
2002
2001
2000
20

99
1998
1919

 ©Cientifica 2004

970

©AAIPX Ltd 2005 Dr Hervé André DURAND

Start-ups are manyStart-ups and small
companies represent
42% of all actors
More numerous thanlarge companies andresearch institutions.

Size of the bubble = amount of actors in the field50(5%)

22(2%)

59(6%)

111(11%)26(2%)

20(2%)

125(12%)170(16%)41(4%)

41(4%)

278(26%)

107(10%)

AsiaEuropeEven if many in theUS, they aresubstantial in Eu andAsia (less visible also, NorthAmerica
so those figures areunderstimates).

Largecompanies

Subsidiaries orjoint ventures

Startups or
small companies

Research institutes
or universities©Cientifica 2004

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

Opportunity and Challenge A fantastic opportunity to build value
 For academic institutions: holding knowledge andIntellectual property
 For entrepreneurs: nanotech offers « green
field » opportunities
 For investors: adventurous capitalists able to handle therisk will reap high reward The real challenge: commercialisation ofnanotechnology from scratch

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

Implementing commercialisation
Little economic barriers
 Many other Huge hurdles Market analysisNon-existing markets
Little data on future markets
Obscure markets for niche applications

 People

Need for both technical and business understanding
Ability to jump from one industry to another
Having an international approach, not local

 Market oriented technology development

Anticipate market needs, not what technology can deliver
Commercialize even things that don’t work or not perfect
Develop products for specific demands: talk to customers early

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

Three issues for nanotech ventures
 Horizontal nature of nanotechnologies
 Applications over many industries

 The « biotech » syndrome
 Time to market: very long after starting Marketing an innovation
 Reaching customers
 Convincing customers

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

1 - Horizontal Nature of Nanotechs


Nanotechologies are often enabling They are not providing solutions to a market need, but supporting

other products and services
 -> no contact with/control of end client -> need to find an advocate to the end client

Nanotechnologies often have applications in manyindustries Difficult to select a particular application

Applications of fullerenes? Nanotubes?

Showcase: PeratechNanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

Peratech Quantum Tunneling Compositesa polymer that changes conductivity when under pressure

 Numerous applications
 Switching & Pressure control
 Power control
 Current sensing
 EMI emission control
 Gas and volatileorganic compound detection

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

Products


Pills
QuickTime™ and a
TIFF (Uncompressed) decompressor
are needed to see this picture.

Cables

Substrates

QuickTime™ and a
TIFF (Uncompressed) decompressor
are needed to see this picture.

QuickTime™ and a
TIFF (Uncompressed) decompressor
are needed to see this picture.

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

Switch control
Power tools
 Speed variatorSecurity
Detection

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

QuickTime™ and a
TIFF (Uncompressed) decompressor
are needed to see this picture.

©AAIPX Ltd 2005 Dr Hervé André DURAND

Textile

FlexibleQuickTime™ and aLow Cost textile switch TIFF (Uncompressed)decompressor
are needed to see this picture.

Strong and resistant

QuickTime™ and a
TIFF (Uncompressed) decompressor
are needed to see this picture.

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

The issueAddressing many industries & markets
Choose the low hanging fruits
 Demonstrate leading examples



Become a material company
 Do not go for final applications: too expensive, too far and too

specializedPartner with industry specialists
 Switch maker Textile specialist

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

2 - The Biotech syndromeTime and path to payback is long
 Long development time required Application and need is only future (no paying customer now) Need is projected but not certainMany real options
 Many technical steps before reaching: technical steps, financial

rounds Many decision points along the way Many financing rounds that are dependant on hard to predict
financial market climate

Bad risk profile No downside recovery

Showcase: Si-Light Technologies Ltd

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

Si-Light Technologies
 Light emission in silicon The Graal of the semiconductor industry

 Merging the telecom and IC world Telecom is III-V based IC and PCs are silicon based

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

The issue
 Not before 2012!
 No tangible introduction before 2009
 5 years of development
 >100m€ of investment !

 Solutions: Developing the technology for quicker applications
Sensing Partnering with a large semiconductor industry player Finding a financial supporter with very deep pockets

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

3 - Commercial reachNanotech Start-ups starts with:
 Technology development
 Product focus
 Potential applications
 Lack of market information
 Lack of sales forceThat is only natural!
 Science and innovations are created by scientists and engineers:

not businessmen!
Show-case: Nano-Sight

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

NanosightA system to « see »nanoparticles with asimple common optical
microscope.
 Applications in

QuickTime™ and a
TIFF (Uncompressed) decompressor
are needed to see this picture.

Biology Nanotech labs
 SecurityNanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

NanoSight

100 nm and 400nm
nanoparticles withyour own eyes!
Brownian motion live!

QuickTime™ and a
TIFF (Uncompressed) decompressor
are needed to see this picture.

A bimodal system of 96nm and 384nm
polystyrene reference spheres in water. Thisclip illustrates how HALO can measure size ofindividual particles, as the differences in
speed under Brownian motion are clear. The
scatter of the larger particles also clearly
differentiates them from the smaller ones.©
Nanosight
http://www.nanosight.co.uk/media/gallery/video/96_and_384nm_polystyrene_nanoparticles_in_water.movNanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

The issue Commercial reach No marketing package
 No sales force

 Way out Get help with experienced marketers
 Partner with complementary product providers Built a distributor network
Quantum Design Japan Co. Ltd Sanpou Ikebukuro bldg. 4-32-8 Ikebukuro
Toshima-ku, Tokyo 171-0014 JAPAN Tel: +81 (｣ 5954) 8570Fax: +81 (3)5954 6570 Email: john@qdj.co.jpWeb: http://www.qd-japan.co.jp

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

Further references: teaching cases
Prof. Suzana KHAVUL & Dr Hervé André DURAND
London Business School - Foundation for EntrepreneurialManagementCenter for Scientific Excellence London
European Case Clearing House
Peratech: LBS Teaching caseSi-Light Technolgies: LBS Teaching case

www.peratech.co.uk

www.si-light.com

Nano-Sight

www.nanosight.co.uk

Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

Conclusion
 Real opportunities exits for creating value frombasic science and inventions.
 Plenty of opportunities exist in Eu and Japan Commercialising and exploiting

nanotechnologies to build value is not easy!
 Requires pluri-disciplinary approach: technology,development, strategy, marketing and sales.
 Need of people with industrial and business experience Ask us more about it!
Nanotechnology Economic Impact in Japan.Tokyo, 30 Sept 2005

©AAIPX Ltd 2005 Dr Hervé André DURAND

Dr Hervé André DURAND
Herve.Durand@aaipx.com

AAIPX -“Idea Transformers” -International
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