Nanotech Investments Growing

The year 2003 saw some $304 million in venture capital funding for nanotechnology, a 42% increase over 2002.

Although this represents a small portion of total venture capital funding, just over 3%, it is an increase over the 2% fraction in 2002. The composition of venture funding in nanotechnology is also changing.

In 2001, some 75% of nanotechnology deals were startup and early stage rounds. By 2003, more than 60% of the deals were for expansion and late stage rounds. This in part accounts for the increased level of investment, and it is an indicator of progress in executing business plans, or at least progress toward a liquidation event.

Public offerings are in thr works. For example, in April, 2004, Nanosys, Inc., which garnered a $38 million late stage investment in the second quarter of 2003, has filed a registration statement in anticipation of an initial public offering.

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