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T174.7.T65 2007
620.50688dc22 2007025686
Preface......................................................................................................................vii
Editors.......................................................................................................................xi
Contributors.............................................................................................................. xv
vii
xi
xv
Contents
Introduction................................................................................................................. 2
Infrastructure for Commercialization......................................................................... 4
Basic Requirements......................................................................................... 4
Disruptive Technologies..................................................................................4
Government Infrastructure Programs............................................................. 5
Clusters and Supply Chain Networks..............................................................6
Intellectual Property and Patents.................................................................... 7
Summary.........................................................................................................8
Steps to Commercialization........................................................................................ 9
Meeting the Challenge.....................................................................................9
Ideas and Concepts........................................................................................ 10
Design, Modeling, and Simulation................................................................ 10
Integration...................................................................................................... 11
Standardization.............................................................................................. 12
Manufacturing............................................................................................... 13
Prototyping.................................................................................................... 13
Packaging....................................................................................................... 14
Testing and Reliability................................................................................... 15
Final-Product Realization and Marketing..................................................... 15
Examples of Products that have taken the Commercialization Path........................ 17
The Ink-Jet Printer......................................................................................... 17
A Brief History of the Ink-Jet Printer................................................. 17
Nano Coatings on Textiles............................................................................. 18
A Portable Blood Analyzer............................................................................ 19
Practical Experiences in Commercializing Micro/Nano-Based Products...............20
References................................................................................................................. 27
Introduction
The ultimate value of any technology to society is its ability to generate useful and
marketable products and systems using available practical knowledge and skills.
Unlike curiosity-driven scientific research, the purpose of technology is to apply
knowledge to facilitate design and manufacture.
New products result from years of research and development. Research gener-
ates new knowledge and therefore intellectual property (IP). Real wealth derives
from the commercialization of that IP. Possession of intellectual property is a neces-
sary beginning of the commercialization process. Creating profit from commercial-
ization is industrys main interest and purpose. This is not the main purpose or first
interest of academia since it derives most of its funding support from government.
Universities are, however, under increasing pressure to raise revenue by exploiting
their IP. Most have set up commercial offices that operate knowledge and technology
transfer schemes to expedite revenue.
This difference of purpose identifies the fundamental cultural gap between
industry and academia. Most government bodies (national and regional) now recog-
nize this cultural gap and are directing their funding strategies more towards projects
that are likely to generate economic value and produce a return on the investment.
Research and development programs are more likely to be funded if there is a clear
path to commercialization and hence wealth generation. Funding bodies now look
for a closer link with industrial priorities than to academic vision. The latter is, and
will always remain, the source from which ideas and new initiatives emerge.
Miniaturization technologies encompassing micro and nanotechnologies are
current leaders in the industrial revolution that is driving the new economy. These
technologies have the potential to provide an unlimited range of new products by
leveraging skills from across many domains. They can be disruptive and thus cre-
ate new product-market paradigms. Disruptive technologies lead to innovations that
have a discontinuous rather than evolutionary nature.1 These discontinuous innova-
tions can create unique products, processes, and services that provide exponential
improvements in value for the customer or end user. But disruptive technologies are
unstructured and have uncertain technological outcomes, making commercializa-
tion difficult to quantify and justify financially.2 They attract risks that have to be
balanced against benefits when planning a development and marketing strategy.
Many products have evolved over the last ten years using established manufac-
turing methodologies developed for the semiconductor industry. These microcom-
ponents and microsystems are embedded in products and systems that are now part
of everyday life. Some examples are mobile telephones, laptop computers, digital
cameras, ink-jet printers, and a huge range of medical diagnostics. However, new
products being produced using nanotechnologies largely depend on an advanced
understanding of the behavior of materials and processes at the molecular level,
where properties are different from operation at the more familiar macroscopic level.
For example, there may be some toxicity issues associated with nanoparticles used in
the formulation of a range of chemicals for consumer products, like sunscreens and
cosmetics. Here, governments generally agree there is a need for further research
Cash-flow Benefits
Income
Reduction
Market Launch
Time: years
Expenditure
Disruptive Technologies
A more detailed text on disruptive technologies can be found in Chapter 2, so here
we shall just give a brief summary of what they are, since they influence the type of
infrastructure required to enable companies to maximize commercial benefits.
Disruptive technologies are those that do not support the existing product manu-
facturing linkages within the industries that embrace them. Thus, the companies
that adopt these technologies must essentially revolutionize their manufacturing
practices. This is nearly impossible for small companies as they lack the technology
infrastructure or resources to dedicate to this task. It is also difficult for large com-
panies to make changes and divert resources from what may currently be profitable
endeavors. The innovation process that results from disruptive technologies is called
discontinuous, where progress is made not through the conventional incremental,
Technology Push
State of
Basic Bottlenecks Stable
Industrial
Research Technological New
Manufacturing
Development Technology
Market Pull
Table1.1
Global Funding for Nanotechnology R&D Programs
Companies in strong industry clusters can innovate more rapidly because they can
draw on the local networks that link technology, resources, information, and talent.
Successful clusters are usually centered on a world-renowned research university.
This model for a cluster has been adapted and used successfully in many regions
and countries for progressing commercialization of MNT-based industries, notably
in Germany and the U.S. According to Grace,6 on a global scale, more than 100
microsystems companies have been created in clusters. No fewer than 35 MEMS,
microsystems, and nano clusters have been formed since the first one was created in
Dortmund, Germany, in 1986. Further examples of industry MNT clusters will be
given in later chapters of this book.
Key elements in building commercialization infrastructures are the establish-
ment of supply chain networks. These provide the support needed to ensure indus-
trial sustainability in particular sectors. It is rare for companies, particularly small
ones, to have all or even some of the experience or expertise required to design,
develop, manufacture, and market products. An MNT-based industry, like any other,
will not mature unless effective supply chains exist. Companies in supply chains do
not necessarily have to be located in the same region but can be outside the country
or region where the manufacturing is taking place. Where this applies, then, well-
structured communication networks are imperative. Having good Internet or person-
alized computer-based communications support is essential to any global business
development. Supply chains give opportunities for growth to very small companies
or start-ups. Being part of a supply chain gives visibility and accessibility to potential
customers. It also reduces risk to the company and increases customer confidence.
Micro-nanotechnology is already stimulating new business opportunities. Esti-
mating the number of companies that are involved in product development and
manufacturing worldwide is difficult. Kaiser7 estimates that currently worldwide
there are more than 4000 companies and research institutes involved in nanotech-
nology, with about 2000 focused on services, 1000 focused on products, and 1000 on
research; these contribute to the global network of suppliers. The leading countries
are the U.S., Japan, China, and Germany. China is growing fastest with more than
600 nanotechnology companies currently registered.
The inclusion of product manufacturers that make use of nanomaterials has
increased in applications areas and redefined the classifications used to describe
such companies.
the commercial value of the IP. In the U.S., however, there is a 12-month allowance
after publishing to file a patent. Publishing by academics often brings earlier awards
and is part of their cultural infrastructure.
Patenting is a mechanism that allows individuals as well as small and large com-
panies to protect their valuable IP. It is the only form of legal protection for assets
from which income or wealth can be derived. A plethora of help exists for those
wishing to patent. It is available through government agencies, private companies,
and consultants. The process of patenting is expensive and takes a significant portion
of budgets, particularly from small companies. Each country has its own system, so
multiple patents are needed to protect IP internationally. Patents and agreements
made in Europe and the U.S. are not always honored in Asia, so at times other pro-
tective measures have to be taken.
Patents only deal with processes or products, not with conceptual ideas. They
can also include modifications to materials and new design software. Multiple own-
ership of software can give problems when modifications made by one owner have
not been agreed to or registered by the others. Nanotechnology is raising many
issues, particularly in the biomedical field in areas like genetic modification and
drug development.
There are three types of patents: utility, design, and plant. The utility patent
covers any new invention or discovery of a useful machine, process, manufacture, or
composition of matter. These are recommended for new small companies like start-
ups owing to their extensive coverage of new products. The design patent covers any
new or nonfunctional design but not structural features. Plant patents are issued for
asexually reproducing plants.
The pathway to commercialization does not stop with the patent filing. Gener-
ally, patents from a number of sources must be compiled and integrated to build a
portfolio to protect the new product or company that may be formed to produce the
product. The new product is then developed around the portfolio of patents, and the
final product will use the patents as protection to maintain a position in the market-
place. IP can be expensive to protect and can be a deterrent to investors. However, if
a technological-based company has no IP, it is unlikely that an investor will invest
without some form of asset to protect that investment.
Micro-nanotechnology companies benefit from licensing patents if they have an
inherent value to the company, since they constitute part of its asset portfolio. Sub-
licensing to manufacturers is often done to build up specific relationships with them
and give protection from competitors.
Summary
We can summarize the basic requirements and key elements for a working commer-
cialization infrastructure as follows:
Steps To Commercialization
Meeting the Challenge
The ten major steps in the ladder to take an idea for a new product to the market are
shown in Figure1.3.
Each step can be subdivided into smaller sets of tasks depending on the nature of
the product and state of knowledge that exists. It is not a linear path, because of the
disruptive nature of the technology and because we live in a world where change,
challenge, and risk will always offer barriers to progress. It is not a path for the
faint-hearted or for those without determination, knowledge, and experience. Expe-
rience shows that unless a suitable infrastructure, as described above, is in place,
then it will be difficult, if not impossible, to take the steps on the path to commer-
cialization. If the required infrastructure does not exist, then companies have to seek
prototyping or manufacturing facilities outside their immediate location or country,
Micro-NanoSystem End Product Realisation
concept -design prototype End product manufacture-market
Markets
Final Product
Pilot Production
Microcomponent Fabrication
Package Design
Modeling-simulation Product
Interface
Electronics Development
Design for Manufacture
which can substantially add to the development and production costs. Large-scale
production is another hurdle that needs to be considered early on if the product falls
into that category. Increasingly, such production can be done more economically
in countries with low labor costs. Such countries do not always have the sufficient
knowledge required to meet the stringent demands of manufacturing the product. It
is essential to have an understanding of the viability of the market for the final prod-
uct. With the rapid increase in technological development and the shorter lifetimes
of products, the reduction in the time to market has become an important factor.9
Globalization has generated the need for global networks and supply chains.
Manufacturing companies need to be part of these if they wish to have access to
services and markets that may not be attainable in their own countries at competitive
rates. There are many examples of innovative companies in the U.K. that, because
of the lack of local facilities, have had to seek such assistance in Asia, the U.S., and
Europe to manufacture their products.
Integration
The rapid growth of microchip and microsytems technology has led the electronics
industry toward integration of more functionality onto a single chip. This decreases
costs and gives increased reliability to products since they contain fewer discreet
components. A number of review articles in a dedicated edition of the International
Newsletter on Micro-Nano Integration (MSTnews)10 outline the importance of the
subject to manufacturers. In particular, the European INTEGRAMplus project11 has
successfully demonstrated the value of integrating micromechnical and microfluidic
systems based on silicon chips. This is predicated on the adoption of a multitechnol-
ogy and multidomain approach with a focus on integrating silicon-based components
with other materials such as polymers as platforms for packaging and interfacing to
the macro-world. It also provides a design methodology in the CAD environment for
the design of components and associate electronics.
The systems integration approach is now being adopted by most designers and
manufacturers and provides a low-cost option for companies, particularly small- to
medium-sized companies that do not have the necessary in-house experience or
resources to do it alone.
The U.S. National Nanotechnology Initiative (NNI)12 has identified manufac-
turing technology as one of its grand challenges, a key area for investment. It
has a target to establish ten R&D integration facilities or centers for nanoscale and
microscale testing and manufacturing before the end of 2007. Other countries are
pursuing similar initiatives.
Micro-nano integration has been slow owing to different levels of maturity on the
two technologies. Microsystems technology is more mature and serves many mass
markets. In comparison, nanotechnology is still mainly embedded in the research
base of many countries. Most of the current work integrates low-dimensional mate-
rials in microsystem components. The IBM Millipede Project13 is an example of
micro-nano integration. Millipede is an atomic force microscope (AFM)-based
data storage concept. Thousands of nano-sharp tips punch indentations represent-
ing individual bits into a thin plastic film; a data storage density of a trillion bits per
square inch, 20 times higher than the densest magnetic storage currently available, is
achievable. It opens up new horizons in high density data storage. Other applications
that can be envisioned are in large-area, high-speed imaging and high-throughput
nanoscale-lithography as well as atomic and molecular manipulation/modification.
Another example of micro-nano integration is the development of single molecule
biosensors that have microelectronic interfaces. These are packaged to be available as
handheld instruments and give rise to a whole range of portable biomedical devices.
Standardization
Industry needs agreement on standards before any new manufacturing methodol-
ogy can progress. Manufacturing standards are a continuing issue for the MEMS/
MST/NEMS industries, but progress is being made. Unlike the mass production
associated with the semiconductor industry, where standards for processing are gen-
erally accepted, MEMS and NEMS products do not have the same magnitude of
volume production. It is too early for the adoption of standards in nano-manufac-
turing except in materials production. Additionally, each product is unique, requir-
ing different manufacturing approaches to produce the product. Here health and
safety rules will have to be adopted as more manufacturers come into business. The
setting of internationally acceptable standards is one of the many challenges to be
faced. Setting and agreeing on standards is now a serious issue for manufacturers of
products based on the use of micro-nanotechnologies. Nanotechnology poses special
problems that relate to whether top-down or bottom-up manufacturing methodolo-
gies are required.
There are many standard development organizations worldwide. Inside Europe,
the Network of Excellence in Multifunctional Microsystems (NEXUS) is a lead-
ing body. In America, the Institute of Electrical and Electronic Engineers (IEEE)
and the National Institute of Standards and Technology (NIST) and, in Japan, the
Micromachine Centre (MMC) are key players. The main international bodies are the
Manufacturing
Acronyms:
Prototyping
There is prototyping, rapid prototyping, and preproduction prototyping. All are
essential prerequisites for volume manufacturing. Modeling and simulation tools
theoretically can make it possible to take the design directly to the preproduction
prototyping stage. In practice, the tools are not mature enough for this to happen.
For this, there has to be integration of these tools with the fabrication processes; they
need to operate across many technology domains to enable designers to produce
systems-based products and services.
The manufacturing of micro-nano structured devices raises challenges. Few
companies currently have the experience or expertise to carry out prototyping
without assistance. Companies often form partnerships or strategic alliances with
foundries or specialist providers for this purpose. As more and more companies are
realizing the importance of the need for integrated solutions, the need for engineer-
ing simulation becomes a major factor to ensure company success.
The fundamental physics and engineering that govern the behavior of micro-
nanoproducts differ from their counterparts in the macro world. Conventional scal-
ing down from the macro level to the micro level and beyond usually does not work.
Prototyping places demands on design and modeling tools. There is an urgent need
for improved tools for specific needs. At the nano level, molecular modeling exists,
but for practical purposes of manufacturing, very few useful packages are available.
A working knowledge of CAD is essential. The type of simulation software used
will depend upon the application and the operational environment. As microsys-
tems increasingly have to work in complex domains, such as RF, optics, and harsh
environments, many different software suites may be needed to integrate the appli-
cation with a specific functionality. These enable the design engineer to predict the
behavior of microstructures and microsystems under a multitude of physical effects
such as electrostatic loads, stress, heat, and electromagnetism. These CAD products
can, as they mature, replace hardware prototyping and enable the testing of designs,
thus providing an engineering simulation solution that is fast, efficient, and more cost
effective.
Packaging
Packaging is fundamental to product functionality and is required to interconnect,
protect, and provide an interface to the macroworld to facilitate human interaction.
It is the most costly part of the process cycle and can represent up to 80% of the total
product development costs. Packaging is central to the design process and must be
considered at that stage, often beginning at the wafer level. Critical features include
cost, reliability, and accuracy. Most microproduct failures have resulted from designs
that have failed when packaging solutions are added late in the product development.
The same applies for products that have embedded nanocomponents, nanomaterials,
and nanosystems.
Packaging design must relate to the operational environment. In sensor and actu-
ator applications, it must protect and interact with the environment. For other appli-
cations, it may be isolated as in accelerometers or gyroscopes. For medical in vivo
systems, complex packaging is required and can be the most important and most
costly part of the device or product. Good interference-free RF or optical connectiv-
ity is placing increasing demands on packaging when the device or component has
to operate in a harsh chemical or biochemical environment. Packaging also has to
be reliable to work in multidomain technologies that include structural, mechanical,
electrical, optical, thermal, chemical, and radiation environments.
A series of connections and interconnections is required in moving from the
nano-size domain to the micro-size domain where humans communicate with prod-
ucts. Whether it is for optics, fluidics, thermal, mechanical, or electronics, combin-
ing functions in a micro- or nanosystem complicates the interconnection schemes
and will sometimes require a new fabrication and packaging approach.
The packaging of MEMS/MST devices and systems ultimately determines their
commercial success. Each product has its own specific requirements related to the
environment in which it has to operate. MEMS packaging is more challenging than
IC packaging due to the diversity of MEMS devices and the requirement that many
of these devices be in contact with their environment. MEMS devices are more com-
plex, having 3D geometries, often with moving parts that are vulnerable to dust and
moisture, mechanical stress, and vibration; therefore, greater protection is required.
Packaging materials are critical to obtaining the correct protection in a particular
environment. Sealing and bonding of these materials sometimes require special
techniques, particularly for operation at high temperatures.
Most companies find that packaging is the single most expensive and time-
consuming part of the manufacturing process. As for the components themselves,
numerical modeling and simulation tools for MEMS/NEMS packaging are virtually
hangs on the marketing skills of the company and its agents. Prior to reaching the
end-product stage, the diligent company would have already put in place a marketing
strategy based on all available market intelligence. This will take into account the
sales impact that the new product will have on the competition, if any exists.
Companies often do not pay enough attention to product promotion and publicity,
although it should be inherent in their marketing strategies. This can result in a lack
of awareness of the prospective buyer, thus delaying early sales. Increasingly, buyers
scan the Internet for new products or updates of existing products. This is now an
attractive and cost-effective medium for promotion since changes and updates can
readily be made, particularly for high-tech products. But expectation and demand
must be met; otherwise credibility is quickly lost. This can be a major problem with
high-volume Internet-based sales when demand can exceed availability.
Some examples of new products now on the market are listed below. These were
taken from the Forbes.com website.18
Between 2006 and 2008, the following key products will be available on
themarket:
In addition to the products listed above and many others that are likely to be
available in the coming years, we will outline below three product areas that are
having a profound impact on society: ink-jet printers, coated textiles (clothing), and
portable blood analyzers.
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FIgurE. This Easton road bike, created using Zyvexs NanoSolve materials, was given
to President George W. Bush in June 2006.
The biggest challenge for piezo-electric ink-jet technology is the cost and dif-
ficulty of producing print heads. Today Epson has a very successful line of piezo-
electric color printers, namely the Stylus color and Stylus photo family of printers,
offering photographic quality.
The treatment keeps wearers dry and comfortable by taking moisture away from the
body at least ten times faster than most resin-treated cotton fabrics available today.
A report published in Innovative Products Based on High-Tech Textiles21 states
that the future of the textile and clothing sector lies not in price reduction but in
more intelligent products with additional functionality. It classified intelligent
clothing into five major areas: transfer systems; adaptive systems; smart clothing;
transponder systems; and microtechnology and nanotechnology.
The textile industry is vital to health and competitiveness of many countries
economies. Many U.S. and European companies outsource manufacturing to Asia,
but they retain much of the IP. Nanotechnology offers solutions for keeping the tex-
tile industry competitive through the use of nanotechnology. The wider availability
of Nano-Tex stain-resistant clothing and fabrics is starting to revolutionize the textile
industry. Europe (EU) has identified the use of nanotechnology as the key to the
future competitiveness of its textile industry.22
Nano-Tex shirts are some of the early products that are finding their place in
retail outlets. The authors possess products like the ones shown and can verify that
they repel most materials that stain, such as red wine, coffee, blackberry jam, tomato
ketchup, and mustard (see Figure1.5).
Figure1.6 (See.color.insert.following.page.16.).I-stat.blood.analyzer.and.cartridge.
automated and requires no medical specialist to operate it. Each cartridge is capable
of performing up to eight tests. The portable blood analysis system eliminates the
traditional process of sending a blood sample to a central laboratory for analysis
then waiting for some time before the results come back to the patient. Adopting this
device means major changes to the way hospitals do blood tests. This initially did
raise, and still does, problems of acceptance by the professionals, as it is seen as an
example of a disruptive technology that threatens jobs and traditional practices. This
is a common problem with new medicine and healthcare diagnostics when the limi-
tations are not due to the technology or public acceptance but to hospital laboratory
management adapting to change.
Over the last 5 years, the acceptance problem has been largely overcome, and i-
STAT has doubled its revenues. It hopes to increase its growth rate significantly over
the coming years. Currently 15 million cartridges are being manufactured each year,
but the company has the capacity to produce 40 or 50 million units.
had to license intellectual property from more than one source. This is understand-
able since most research in micro- and nanotechnology areas is funded by govern-
ments. Many funded programs focus on similar areas at different universities and in
various countries. Principal university investigators collaborate with one another on
a global basis and move from university to university. This results in a dispersion of
intellectual property that is difficult to aggregate to form the basis for a company.
In one example, at a major United States university, more than 25 microtechnol-
ogy-based patents were accumulated in the university portfolio. When the patents
were analyzed for commercial opportunity, there was not enough intellectual property
for a start-up company to have freedom to operate. However, after extensive searches
to explore the aggregation of patents from other universities, three companies were
formed. Standing alone, none of the universities had hope for a return on their research
investment when considering their individual patent portfolios. However, the aggrega-
tion of patents resulted in all institutions having a return on their investment.
Many of the micro- and nano-based start-up companies considered here did very
little intellectual property analysis some did none at all, even with significant
committed venture funding. When considering a start-up company or a product in
the micro/nanotechnology space, it is important to do an extensive intellectual prop-
erty analysis in the specific area to determine the landscape of the intellectual prop-
erty. As the design matures, the intellectual property landscape should be constantly
reviewed to ensure that paths are taken that allow freedom to operate and to generate
new intellectual property.
As the product concept is developed and as design begins, significant chal-
lenges arise when attempting to use conventional macro-based product design
methodologies. One of the first challenges is human resource related the avail-
ability of engineers who think and design at the micro- and nanoscales. Challenges
begin with universities where researchers and scientists are educated in micro- and
nanoscale domains, each in a very specific area. However, researchers and scientists
are not product design engineers. In developing a product concept, researchers and
scientists address only about 10% of the total pathway to commercialization. Product
design engineers provide a unique capability to successfully move along that path-
way to commercializing a product. They start where the scientist leaves off and take
the concept all the way to the finished product. For the most part, universities teach
design at the macroscale, with little if any education at the micro- and nanoscale. The
typical design engineer develops a specification for a product, deriving its expected
performance, shape and size constraints, electrical requirements, etc. A design engi-
neer in the conventional macroworld uses known standards and metrics for piece
parts and processes. He would use supplier catalogs to find components that meet the
product requirements. If he needed to fabricate parts, he would use readily available
materials with properties that are understood. He would use manufacturing pro-
cesses that are standardized and well understood, such as machining and injection
molding. If the engineer needed a piece of equipment for manufacture or assembly,
he would select a supplier who manufactured the equipment as a standard catalog
item. It would be delivered to the expected specification and perform in an expected
manner. The design engineer would not risk selecting components or equipment that
were unproven.
At one company that had especially elegant micro/nano product designs, the
design engineer was asked how he developed such elegant designs. He responded,
I go into a trance and shrink myself down (as he contorted himself in his chair and
began to slide under the table) and put myself inside the device I am working on. I
visualize the inside connections and interfaces and design the device from the inside
to the outside. How does one transfer this capability to a university professor teach-
ing design engineering, who most likely has never commercialized a macroproduct
and probably has no idea about micro and Nan design?
Companies that are successful in designing micro- and nano-based products do
not rely on the experienced macrodesigners. They bring baggage from the macro-
world that does not lend itself to success in designing micro- and nano-based prod-
ucts. The successful companies hire recent college graduates who are open-minded,
very bright, creative mechanical engineers who are not indoctrinated in traditional
methods. These engineers have no preconceived ideas of what the limits are. Under-
standing materials is also important. The industrial designer (even one experienced
at the macroscale) who is creative, excellent at visualization, and more of an artist
than an engineer can also be very successful at micro- and nanoproduct design.
In micro- and nano-commercialization, there are few simulation and design tools
and standard manufacturing processes, as well as a lack of metrics, standards, and
specifications. There is no repository of knowledge for the design engineer to refer-
ence. A great deal of knowledge has been generated by companies that have com-
mercialized, or attempted to commercialize, micro- and nano-based products. Since
that knowledge was generated in an industrial environment, most of it has not been
published or disseminated to the public. At one company, nearly $50 million was spent
developing interfaces, packaging, and manufacturing and assembly processes to pro-
duce an ink-jet print head. The processes developed could be applied to other microflu-
idic products; however, they were never published and only disseminated as those who
were involved moved into new jobs at other companies and shared their knowledge.
Progress has been made in simulation and modelling software at the microscale,
but there are significant challenges at the nanoscale. For example, modeling of injec-
tion molding processes at the microscale with nano-tolerances is not possible. One
company making a microfluidic medical diagnostic device had to resort to trial and
error to mold a precision part to nano-tolerances. In developing the tooling to pro-
duce the part to specification, 55 modifications were made to the mold, requiring a
significant amount of time and money.
For silicon-based MEMS devices, reasonable simulation and modelling software
exists to support commercialization. The same is true for microfluidics. The diffi-
culty in modelling and simulation comes at the interfaces and connections between
the micro- or nanoscale and the human interface at the macroscale where the prod-
ucts are used.
As design progresses, the engineer has to consider how he will build the device
to make the first prototype. Engineers, particularly those with experience in mac-
roengineering, would design the prototype to be made in a model or machine shop
using traditional machining and forming equipment. This approach will surely result
in failure of the product to be optimized. It will not meet performance, size, func-
tionality, and cost requirements, if it functions at all.
A company building an imaging device that was embedded into its customers
imaging product exemplifies the importance of starting out on the right footing to
build the first prototype. Because of time and cost considerations, the company
decided to build the prototype using conventional macro approaches. The imager
was far larger than originally envisioned, its performance was lower than expected,
and the cost was significantly higher. The customer was no longer interested in
embedding the imager into the product; the cost to redesign it to accept the imager
was no longer justifiable considering the now fewer advantages. The imaging device
company could not change its design to reflect the advantages of microtechnology
because it had built an infrastructure of people and equipment from the macrocul-
ture. This company is no longer in business.
The micro/nano product design engineer must work closely with process, equip-
ment, manufacturing, assembly, and facilities engineers. This team approach is nec-
essary to design an optimized product. There is a lack of standard, off-the-shelf
fabrication and measurement equipment, parts, connections, packaging, processes,
and micro-assemblies. Therefore, product design, process development, manufactur-
ing, assembly, and unique facility requirements must be considered together when
designing micro-nanoproducts. All of the companies that produced a successful
product had to practice the integrated team approach, mainly to develop processes
and equipment for manufacturing, assembly, and measurement.
One example was a company developing a page-width (300 mm), ink-jet print
head for precision, high-speed printing. At that time, the semiconductor industry
had developed processes and equipment for 200 mm wafers. To achieve precision
and diameter in the ink-jet nozzle position, submicron lithography was necessary.
However, at the time, no equipment existed that could handle parts that were 300
mm in length, and no equipment existed that was able to handle geometries different
from a silicon wafer. In addition to designing lithography equipment (which included
designing unique energy sources), a totally new process and new equipment were
needed to coat a resist to the thickness specification. No measurement equipment
existed for submicron measurements over a length of 300 mm. This equipment had
to be designed and built. The process to fabricate the ink-jet nozzle structure con-
sisted of 54 variables that had to be precisely controlled. The worlds top statisticians
said it was not possible to control the process and produce a consistent product. Dr.
Taguchi became involved, applied the Taguchi Method for Robust Design (a revo-
lutionary approach at the time), and within 30 days a predictable, consistent, and
repeatable product was delivered.
In another example at a different company producing a thermal ink-jet print head
with a silicon print element, similar experiences with a team approach were neces-
sary. The print element was made by bonding two silicon wafers together one
a fluidic structure for delivering the ink and the other the substrate for the drive
electronics and heating element. After bonding (equipment, process, and adhesive
for bonding had to be developed), the wafer stack was diced to separate the print
elements. Dicing through the wafers to expose the nozzles had to produce a mirror
finish with no chipped edges, as illustrated in Figure 1.7. A chip on the nozzle edge
would change the surface energy condition, causing the ink-jet drop to stray off
course. This would reduce the sharpness of the printed image.
Silicon Wafer
Microuidic Nozzle Structure
Silicon Wafer
Electronics
Each year, millions of wafers are diced for the electronics industry by specialty
dicing suppliers in the Far East. There were many suppliers who claimed they could
meet the dicing requirements for the ink-jet nozzles. Even when they tried to improve
their processes, they could not come close to meeting the quality requirements nec-
essary for dicing ink-jet nozzle structures.
Because the ink-jet print head performance was dependent upon a chip-free
nozzle edge, the company undertook developing the dicing process. A high-perfor-
mance dicing saw was purchased and modified by dynamic balancing and precision
temperature control of the cutting fluid, as well as other modifications. This achieved
a significant improvement but it was not good enough.
Then dicing blade performance was investigated with suppliers who thought
their experience and expertise produced the best blade possible but it was not
good enough. The company undertook a development effort to select the appropri-
ate material and develop a dicing blade to meet the ink-jet requirements. When the
dicing blade was developed, the process was offered to dicing blade suppliers to
produce dicing blades to meet ink-jet requirements. None of the suppliers were able
to expand their vision and change their manufacturing processes to make blades to
address new markets. It was necessary for the company to build a dicing blade man-
ufacturing operation to meet its quality needs. The new dicing process was able to
produce a high-quality mirror finish, with no chips at the nozzle edges. This dicing
process was accomplished at speeds considerably faster than the speeds at traditional
suppliers and was achieved with a much higher quality output.
With nearly every micro-nanosystem product, suppliers who were considered to
be top quality could not meet the requirements of micro- and nano-based products.
They were boxed in by their past and believed, from their experience and years of
process improvements, that their processes were optimized to be as good as they
could be. A new view from outside the box (a disruptive approach) can produce sig-
nificant improvement to meet the unique requirements of micro- and nanosystems
and is generally necessary for successful product commercialization.
FIGURE 1.8B Integrated, automated manufacturing layout of equipment for each step in a
process to build and/or assemble a complete ink-jet print head.
be realized. The integrated approach was used in all of the companies that success-
fully commercialized a high-volume micro/nanoproduct. For low-volume products,
the cost for equipment and facilities may not warrant the integrated approach. How-
ever, performance, size, and cost of these products will not be optimized.
Customers may also have great difficulty moving out of their paradigm to envi-
sion new market opportunities with micro- and nano-based products. They often
have trouble communicating in the language of micro- and nanotechnology. Lack of
understanding makes customers reluctant to accept these new technologies as part
of their product offering because they are steeped in traditional engineering and
manufacturing methodologies.
A nano-based process was developed to make fuel injection nozzle structures
for a large automotive company. The vice president of manufacturing, with decades
of traditional manufacturing experience, became increasingly frustrated even as the
program exceeded performance and cost expectations. He retired, abruptly, because
he had no frame of reference at the nanoscale. He could not make decisions on some-
thing he could not see.
At the same company, internal political and organizational issues began to sur-
face. After millions of fuel injection structures had been delivered defect free, one
of the most powerful groups responsible for the product delivery process, the Qual-
ity Department, began to feel threatened. As it became evident that this group was
no longer influential and jobs would be eliminated, roadblocks were put in place
attempting to limit the programs effectiveness. When jobs are threatened, defence
mechanisms are often put in place by both engineers and managers.
Successfully selling a micro/nano-based development or product program
to a traditional customer is a significant challenge. In working with customers,
particularly those with traditional products and infrastructures, one must be sure
that senior management supports micro/nanotechnology-based products. Gener-
ally, senior management is very interested in high-performance products at a lower
cost. This is not necessarily true for all those in the organization below the senior
management level, where significant change in infrastructure may have to occur to
deliver disruptive new products.
To ensure that customer requirements are understood, it is necessary to find a
champion below the senior management level. This person should know the com-
panys product infrastructure and organization structure. He should be a maverick
who does not play by the corporations book of rules and is not afraid to bypass all
intermediate management and go directly to senior management to get roadblocks
quickly removed. Each organization has a few of these types; they are the change
makers that force a company to consider new products.
These general comments and specific examples and recommendations are the
summation of experience from companies that were commercializing micro-nano-
integrated products. Those products include a variety of ink-jet print heads, optical
switching devices, medical laparoscopes and endoscopes, implantable medical sen-
sors, medical diagnostic point-of-use microfluidic sensors, automotive fuel injection
systems, infrared imagers, vehicle stability management control systems, and energy
power devices. As time moves on, universities continue to provide excellent research
and intellectual property for future micro- and nano-based products. Education
for design engineers continues to be lacking. Simulation and modelling software
continues to evolve, particularly for microsystems and microfluidic systems. Some
dedicated equipment is available for micro- and nanofabrication with continued
evolution. Building prototype, pilot, and production quantities continues to be very
difficult. The micro-nano model shop or machine shop does not exist. Germany, spe-
cifically the Dortmund Cluster, which includes the Microfactory concept, is building
a micro-nano commercialization infrastructure. In Melbourne, Australia, MiniFab
is beginning to evolve to provide a commercialization infrastructure. However, in
general, governments are lacking vision by not investing in and developing a com-
mercialization infrastructure, thus not taking advantage of what will be considered
the greatest economic development opportunity in history.
REFERENCES
1. Walsh, S. and Suleiman, M; Models for the commercialisation of disruptive technolo-
gies, International Journal of Technology Transfer and Commercialisation, 3, 187
198, 2004.
2. Walsh, S, MANCEF Roadmap, Sept. 2002. ISBN:0972733302
3. Royal Society Policy Document, Nanoscience and nanotechnologies:opportunities and
uncertainties, July 2004, ISBN 0-85403-604-0.
5. The U.K. MNT Network, http://www.mntnetwork.com/.
4. Taylor, J.M., Report New Dimensions for Manufacturing A UK Strategy for
Nanotechnology; DTI pub 6182, June 2002.
6. Grace, R., Technology cluster development: the MEMS industry report card 2006,
Small Times, January 2007.
7. Kaiser, H., Report: Summary about the State of Nanotechnology Industry Worldwide
20032015, www.hkc.com/nanomarkets, 2006.
8. The MANCEF Roadmap (2nd edition) ISBN: 0972733302; Chapter 4, 2004.
9. Tolfree, D. and Eijkel, K., Reducing time-to-market for nicrotechnology produced
products, presented at the World-Nano-Economic Congress Europe, London, 6
November 2003. Talk only reference on www.world-nano.com/WNEL-London.
10. Micro-Nan Integration; MST News, No. 4, August 2006.
11. Richardson, A. and Pickering, C., The INTERGRAMplus Access Service, MST News,
No. 4, August 2006.
12. The U.S. National Nanotechnology Initiative, http://www.nano.gov.
13. Eleftheriou et al., Millipede a MEMS-based scanning-probe data-storage system,
IEEE Transactions on Magnetics, 39, 928, 2003.
14. SEMI Standards, www.semi.org/standards, 2004.
15. IEEE Standards, www.ieee.org/standards, 2004.
16. Standardization of microsystems technology European Commission Project July
2002.
17. Richardson, A., Design for Micro-Nano Manufacture, PATENT-(DfMM), 2003, www.
patent-dfmm.org.
18. http://www.forbes.com in 2005.
19. http://www.castleink.com/a-inkjet-printer-history.
20. NewScientist.com, news service, 27 January 2007.
21. Innovative Products Based on High-Tech Textiles, 57, 2004.
22. EuroFutureTex Conference. November 89, 2005, Padua, Italy.
23. http://www.abbottpointofcare.com/istat/products/analzsers.htm.
Contents
Introduction............................................................................................................... 30
Folklore.......................................................................................................... 30
Two Classes of Technologies.................................................................................... 31
Evolutionary Technologies............................................................................ 31
Disruptive Technologies................................................................................ 32
Demand Pull and Technology Push Marketing Strategies....................................... 33
Technology Class Matched to Market Strategy........................................................34
Market Strategies for Evolutionary Technologies.........................................34
Market Strategies for Disruptive Technology................................................ 35
Silicon Pulling Industry: Evolutionary Technology...................................... 36
Silicon Pulling Industry: Disruptive Start-Ups............................................. 37
Examples of Disruptive Micro and Nanotechnologies............................................. 38
Micro Technology: Semiconductor Technology22......................................... 38
Nanotechnology: Gene Splicing24................................................................. 39
Sources of Disruptive Technology............................................................................40
Recommendations for Starting a New Technology Business................................... 41
Determining the Nature of Your Technology................................................ 41
Financing Technology Start-Ups................................................................... 41
Selling Your Second First Product................................................................ 43
Distribution is Frequently Complex..............................................................44
Do not Give up Your Original Product Idea.................................................. 45
Create a Team................................................................................................ 45
Do not Write a Business Plan........................................................................ 47
Summary and Conclusions....................................................................................... 48
References................................................................................................................. 48
29
Introduction
The purpose of this chapter is to examine the role of technology in new micro and
nanotechnology business formations so as to debunk some misperceptions in cur-
rent folklore and to suggest guidelines for starting a new technology-intensive firm.
The widely believed folklore is that newly formed technology-intensive firms suc-
ceed using radically new technologies to commercialize disruptive innovations. It is
argued that new technology-intensive firms are best at doing this because they have
no existing customer base to please and no internal bureaucratic organization to
resist change. Much credit for popularizing this concept goes to Christensen in his
book The Innovators Dilemma.1 Although not a new concept in the academic litera-
ture, Christensen successfully brought this information to a much wider audience.
We begin by discussing the current widely believed folklore and demonstrating
why it is an oversimplification of reality. Next we provide descriptions of the two
classes of new technologies and how these should dictate start-up market strategies.
This is followed by a description of two well-known examples of disruptive technol-
ogies, one micro and one nano, that have entered world markets in the last 50 years.
We use this background information to offer some guidelines for starting a micro or
nanotechnology business in todays markets.
Folklore
Christensens hypothesis does not agree with actual experiences. The precise operat-
ing pattern that the vast majority of new technology firms use to accomplish tech-
nology commercialization is not uniform from business to business, and no clear
patterns exist because each technology firms commercialization effort is unique;
no two are exactly alike. Christensen offers this hypothesis as though most newly
formed technology firms succeed using disruptive innovations. However, this is a
role rarely played by the new firm. More often the invention is based upon a unique
use of existing technology, and entry occurs when new firms create substitute or
replacement products for the established competitive firms existing products/cus-
tomers. This provides a quick way for the new firms to enter existing markets and
achieve relatively quick profitability.
Second, contrary to Christensens general hypothesis, major established firms
competitive responses to new high-tech entries have historically protected the major
established firms while harming the new firms that threatened existing markets.
Often, some established firms respond by simply copying the new technology and
forcing the new firms to sue to enforce patent rights, a procedure that often causes
new firms to fail. In other situations, established firms will defensively guard exist-
ing distribution systems to constrain the new firms access to markets.
A new paradigm has emerged in the last 20 years reducing the economically
vicious competition between large established technology firms and new start-up
firms as envisioned in Christensens hypothesis. Many major corporations are now
acquiring or licensing the intellectual property of new technology firms that have
developed products based on radically different technologies than those possessed by
the major firms.2 This acquisition process appeals to these acquiring firms because
it may be a less expensive way to acquire new technology or simply a speedy way
to enter new markets or both. This seems to indicate a growing awareness of the
value of innovations brought to the market by new technology firms. This has been
true in the micro and nanotechnology fields.
Thus, new technology firms have discovered new operating procedures that
promise better results. Rather than threatening the existing major firms in a given
market, the ambitious firms seek to partner with or become a part of a major firm
that takes on the marketing of the product. Still, some new firms continue to inde-
pendently struggle and achieve success.
Behind this complex appearance of new technology firm behavior lay some fun-
damental principles based upon technology management theory developed over the
last 30 years that not only describes the role of new technology firms but also pre-
scribes the appropriate methods that lead to their success.
The following sections begin by summarizing the theory of technological inven-
tions as developed by academic authors over the last 30 years. Two classes of inven-
tions have evolved from this theory based primarily on two different science sources.
In addition, we provide an example of successful micro and nanotechnology firms
in both classes. Then, we describe the two major methods of marketing matching
the two classes of technology where each method offers different opportunities and
threats. Lastly, we provide some guidelines for high-tech start-ups that emerge from
an analysis of how these theories can be implemented for survival and profitability.
Evolutionary Technologies
Evolutionary technologies might be described as business as usual with a continu-
ous flow of technical inventions emerging from R&D based upon the suppliers core
technical competencies and/or from customers suggestions or requests. Evolution-
ary technologies, also referred to as incremental, sustaining, competence enhancing
or nuts and bolts technologies, build off of the existing body of knowledge with
respect to production capabilities and manufacturing or processing practices and as
such have known performance levels and forms of application.3,4 Technologies can
originate either inside or outside an industry. Those that originate inside are said
to be based upon core competencies of corporations in the industry as defined
by Prahalad and Hamel.5 The basis for technology is the organizations core com-
petencies that evolve into a stream of continuous innovations that are delivered
to customers as either replacements or substitutes for existing products or as new
or greatly improved products. These two product categories are driven by different
customer interests and different marketing strategies as discussed below. Replace-
ment or substitute products are those that customers knowingly request to meet their
needs, improve their operations, reduce costs, increase the quality of their prod-
uct, or to produce a competitive advantage in their markets. Major new or greatly
improved products are not knowingly requested by customers and do not meet needs
that are known to the customers. Thus, although one dominant technology underlies
the inventions, the technologys evolution over time offers the opportunity to invent
products for which there are ready buyers or create new inventions that satisfy cus-
tomer needs that are not apparent to the buyer.
Disruptive Technologies
Disruptive technologies frequently find their origins in new science, most of which
emerges from academic or corporate R&D or independent scientific research. Schum-
peter6 observed that innovations with major impact upon economic activity originate
from outside the industry that they affect. Schumpeter also argues that these inno-
vations emerge from and become the reason for the formation of new independent
firms, i.e., entrepreneurship. To the extent that Schumpeterian product innovations
are technology based, he argues that new independent firms are well suited to bring
innovations from outside the existing industry structure and creatively destroy the
market structure therein.7
Schumpeters observations agree with those of more recent theorists. Abernathy
and Utterbach8 state that such technologies are built upon new knowledge and/or
new manufacturing practices and are applied to create entirely new product-mar-
ket paradigms that are often opaque to potential buyers. Further, Anderson, and
Tushman,9 evolve from Abernathy and Clark10 and others discussing an era of fer-
ment when new technology product paradigms are vying to become the industry
dominant design. Bohn11 notes that measuring and managing these technologies is
difficult. Bower and Christensen12 further expand this definition with the statement
that technology is considered disruptive when its utility generates service products
or physical products with different performance attributes that may not be valued
by existing customers. Such technologies are applied to create entirely new product-
market paradigms that are often opaque to potential buyers.13 Commercialization
products derived from disruptive technologies are frequently referred to as radical
or discontinuous innovations.
Academic research that develops new science sometimes results in the academic
researchers starting new companies to invent and commercialize new products and
services. And some new science originates in the R&D departments of major corpo-
rations. These are sometimes not wanted by the founding corporation and are rejected
for development within the major firms and frequently are either licensed or spun off
to new technology firms. The technology founders are sometimes encouraged to or
willingly leave their employers to pursue their new science into a product invention.
As with evolutionary technologies, disruptive technologies can create innova-
tions that provide two categories of products: replacement or substitute. However,
neither category of these is fully recognized by buyers as beneficial to their interests.
Moore14 states that this customer negative evaluation aspect of disruptive tech-
nologies by noting that these technologies generate discontinuous innovations that
require users/adopters to change their behavior in order to make use of the innova-
tion. As such, disruptive technologies often require that buyers change their behavior
or thinking so to be able to use the products to which the innovations are applied
effectively. Inventions that are entirely new products requiring user change behavior
are not initially recognized by buyers as being beneficial at all. Commercializing
these inventions can be very difficult due to this buyer change behavior no matter
how strong the new value proposition is either in a personal or an organizational set-
ting. To overcome buyer/user resistance to adopting disruptive technologies, produc-
ers of such innovations must demonstrate that such technologies provide significant
cost reductions and/or performance improvements. In this way, customers are found
who are willing to take the risks of newness.
These totally new inventions based on new science and disruptive technologies are
what Schumpeter calls creative destroyers. By his definition, such innovations are so
radical that they destroy existing markets and the dominant firms that supply these mar-
kets, replacing them with entirely new markets and firms based on new technology.15
Market Replacement
Pull or Substitute
existing customers, some market research by your sales personnel will be required to
learn more about your customers and identify their existing need that is not currently
in the forefront of their thinking. Then your sales force is challenged to make the
customers desire to add this invention to his current list of needs and eventually buy
the invention. This invention can be sold on the basis of major improvements in qual-
ity or significant reductions in costs. Either of these results will give your customer
a strategic advantage in competitive markets.
This is the essence of technology push market strategy and should be the major
work of well-trained sales professionals. In the section above, we provide an example
of a start-up business that used well-known science to create a new unique product
that potential buyers needed. Dialogic Corporation started with one scientist and two
experienced technical marketing/managing professionals. The two industry-expe-
rienced team members saw the potential need for a unique invention derived from
known technology, and they teamed with the scientist to create the invention that
became their first product. Subsequently, they were able to create a major company
in their chosen field with significant financial success for all three founders.
Technology Creative
New Science Push Destroying
Market Replacement
Disruptive Radical
Pull or Substitute
acceptance of substitute and replacement products with only modest success. Since
Genentech had raised $35 million with the public sale of stock in 1980, it persevered
and eventually after 12 years finally scored with a truly new innovation that provided
the basis for major growth in its revenues and profits.19
In todays economic environment, it may be possible to identify other suppliers
that already provide products to those buyers who are likely candidates for your dis-
ruptive technology products. One or more of these suppliers may be willing to form
an agreement with a start-up firm that is pursuing a disruptive technology that is
interesting. This has become especially common in the biopharmaceutical industry
where technology sharing among established industry members and new firms is
becoming very common. This is a possible way of gaining financial assistance that
will allow a long-term project to commercialize a disruptive technology.
On the other hand, if you have start-up team members who have established cus-
tomer relationships with potential buyers, then you have an advantage to use your tech-
nology with a buyer pull strategy. The team members with customer contacts become
the major mechanism to identify buyer needs for products that can be substitutes or
replacements for products that these potential buyers already own. Substitutes and
replacements have to demonstrate significant quality improvements or cost reductions
to close the sale. This is the quickest way to assure survival and become profitable.
However, no doubt you would prefer to see a more unique invention that will
take advantage of your technologys major advantages for applications that seem-
ingly need major improvements. It is a long hard pull, however, to bring a disruptive
technology into successful products that provide profitable operations. It is better
to take the quick route to survival and profitability before switching your attention
to your dream product. But keep your dream, for you may be able to afford the
challenge of creating profitable operations with the dream product in the future. It
will take years to bring the dream invention into a profitable product and creatively
destroy the established market structure. It took Intel 10 years from the development
of the 4004 microprocessor in 1971 to the 8086 that became the big product in 1981.
It took another 13 to 14 years for the microprocessor to creatively destroy the estab-
lished computer industry. And this happened only because a large number of other
technologies interacted with the microprocessor software and hardware as it
evolved into a creative destroying product.
addition, the newest technology was recently introduced in the industry, and their
entry can be described as early followers. Since these firms knew the industry buy-
ers, and buyers knew the new technology, they used buyer pull with minor technol-
ogy push market strategy. This worked well as they acquired market share quickly
before major firms entered this market. This combination of new technology with
demand pull and minor technology push strategic marketing used by these six start-
up firms resulted in four of them becoming very successful and the other two mod-
estly successful. All survived or were acquired by larger firms at a profit.
sition by a major firm. Now, the chemical pharmaceutical companies are buying
some of these new firms.
One way to avoid the second first product problem is to acquire a team member
that has been selling similar products to the same customers you are targeting. Even
though this is one possible way, it does not always work; however, it is worth a try.
For example, in 1983 a Ph.D. physicist joined with two salesmen to form Dialogic,
Inc. The salesmen worked for two different suppliers selling equipment and parts to
telephone switching equipment manufacturers. Telephone answering systems were
becoming more popular and doing more complex functions. The salesmen thought
they knew a major problem with the existing answering systems. The scientist rec-
ognized that a piece of sophisticated hardware could replace some complex software
and provide a faster more responsive answering system. Since they knew the custom-
ers and knew their needs, this should be a snap. They began product development
using existing technology and completed a finished model in one year. But, when
they approached customers, they received the response that this was not exactly
what was wanted. Instead of a single-line answering system, customers wanted a
multi-line system. After 6 more months of R&D, Dialogic introduced its second first
product, and sales took off. It seems that sometimes even the most experienced and
knowledgeable persons still need a second first product. However, they would have
been successful earlier if they had taken a prototype around to their customers first.
Dialogic went public in 1994 and was wholly acquired by Intel in 1999. Needless to
say, the founders benefited financially.
Create a Team
A one-person start-up technology company is a rarity in todays world. Realistically,
starting and managing a technology business is far more complex than a new retail
store, restaurant, auto repair shop, or a consulting business. It is the rare individual
who has all the specialized knowledge and skills that are required to start a technol-
ogy business. And, money is harder to attain since there are only a limited number
of people who will believe in your technologys promise of future success and prof-
its. The head entrepreneur must assess his/her knowledge, skills, and experience to
determine what specializations are missing. Then, the entrepreneur must find per-
sons who possess those missing specializations. Below is a list of the key people that
should be in the start up team.
R&D: A strong technical specialist who can carry on the R&D work of convert-
ing technology into saleable products is essential.
Marketing: At first glance, distribution systems can appear to be very complex,
but in reality they are not complex if you have a team member who knows the market
and the potential buyers you are targeting. Try to obtain an experienced marketing
professional with knowledge of the industries that you believe are most likely to
contain potential customers.
Manufacturing: Manufacturing a prototype and bringing it to actual produc-
tion-level manufacturing requires special skills, so an experienced manufacturing
manager makes a useful addition to your team.
Human resources: The process of hiring, firing, and compensating employees
is fraught with major issues such as taxes, social security, healthcare benefits, and
antidiscrimination and handicap access laws. And the process of selecting employ-
ees can be very challenging. A team member with experience in human resources
can be worth a lot in avoiding the sinkholes in employee regulations and laws and
selecting the proper employees.
Finance: Private accountants can be hired by the hour, but the complexity of
guiding and operating a business requires much more than an accountant. A finan-
cial specialist is the person who plans and executes the steps necessary for survival
and eventually profitability. You need a team of 3 to 6 competent people to start a
new technology firm.
Chief executive officer/manager: Management is an important skill. A profes-
sional experienced manager is valuable. This is why most venture capitalists install
their own experienced CEO when they invest in a technology firm. This is a very
important part of the team. In fact, the initial team may consist of fewer special-
ists by using outside organizations. Human resources can be acquired by using an
employee leasing firm. Rather than hiring employees (non-ownership participants
are employees), you lease them from the leasing firm. This gives you a zero employee
firm since owners are not employees under U.S. law. This is different in some Euro-
pean Union nations.
In addition, you need a certified public accountant, a patent attorney, and a busi-
ness attorney. Also, there are many accounting firms that will not only keep your
books but also provide management information reports (different than the account-
ing data routinely provided by accountants) and consult about the firms finances.
A manufacturing manager need not be hired if you sub-contract all manufactur-
ing to a reliable manufacturing company. The choice of this manufacturer is critical,
and it may be desirable to hire an experienced manufacturing specialist to assist in
choosing a firm to do your manufacturing.
That leaves the founding team as three persons: a CEO, a technical R&D expert,
and a marketing specialist. The technical expert frequently is the lead entrepreneur
and takes the CEO role. You will notice that Dialogic began with two technical sales
engineers and a Ph.D. physicist. The Ph.D. shared the CEO responsibilities with the
two technical marketing experts. After 3 years of profitability, the team hired an
experienced CEO.
the firm, the time has come to write the business plan. The plans value is to persua-
sively explain the future of the firm to someone outside of the founding team.
Hopefully, a well-developed team exists and sales have been made. Team qual-
ity and sales revenue are the strengths that need to be presented to potential inves-
tors through the business plan. This is the firms plan for the future, including the
opportunity for all investors to take their original investment and profits out of the
company as cash payments when it becomes successful. It is a fact of new businesses
that no investor, nor team member, wants to leave all the hard-earned profit tied up
in the business forever.
References
1. Christensen, Clayton M., The Innovators Dilemma, Harvard Business School Press,
Boston, 1997.
2. McHugh, J., Forget old-school R&D. These companies purchase their ideas one startup
at a time, Wired, July 6, 2006.
3. Foster, Richard N., Timing technological transitions, in Technology in the Modern Cor-
poration: A Strategic Perspective, M. Horwitch, Ed., Pergammon, New York, 1986.
4. Bower, Joseph L. and Christensen, Clayton M., Disruptive technologies: catching the
wave, Harvard Business Review, 73, 1995.
5. Prahalad, C.K. and Hamel, G., Corporate imagination and expeditionary marketing,
Harvard Business Review, 69, 8192, 1991.
6. Schumpeter, Joseph A., Capitalism, Socialism and Democracy, Harper and Brothers,
New York, 1942.
7. Schumpeter, Joseph A., The Theory of Economic Development, Harvard University
Press, Cambridge, 1934.
8. Abernathy, William J. and Utterback, James M., Patterns of industrial innovation, in
Readings in the Management of Innovation, 2nd ed., Tushman, M.L. and Moore, W.,
Eds., Harper Collins, New York, 1988.
9. Anderson, P. and Tushman, M., Technological discontinuities and dominant designs: a
cyclical model of technological change, Administrative Science Quarterly, 35, 604633,
1990.
10. Abernathy, W.J. and Clark, K.B., Innovation: mapping the winds of creative destruc-
tion, Research Policy, 14, 322.
11. Bohn, R.E., Measuring and managing technological knowledge, Sloan Management
Review 36:3, 6173.
12. Bower, Joseph L. and Christensen, Clayton M., Disruptive technologies: catching the
wave, Harvard Business Review, 73, 4353, 1995.
13. Bower, Joseph L. and Christensen, Clayton M., Disruptive technologies: catching the
wave, Harvard Business Review, 73, 4353, 1995.
14. Moore, Geoffrey A., Crossing the Chasm: Marketing and Selling Technology Products
to Mainstream Customers, Harper Business, New York, 1991.
15. Schumpeter, Joseph A., The Theory of Economic Development, Harvard University
Press, Cambridge, 1934, p. 75.
16. Schmookler, J., The Theory of Economic Development, Harvard University Press,
Cambridge, 1966.
17. Kirzher, Israel M., Perception, Opportunity, and Profit: Studies in the Theory of Entre-
preneurship, Chicago University Press, 1979.
18. Schumpeter, Joseph A., The Theory of Economic Development, Harvard University
Press, Cambridge, 1934.
19. Barker, R., Taking stock of Genentech: are investors overestimating its promise?, Bar-
rons National Business and Financial Weekly, March 4, 1985, p. 67.
20. Newbert, Scott L., Kirchhoff, Bruce A. and Walsh, Steven T., Defining the relationship
among founding resources, strategies, and performance in technology intensive new
ventures: evidence from the semiconductor silicon industry, Journal of Small Business
Management, in press, July, 2006.
21. The cost of a manufacturing plant exceeded $500 million by 1990, and no new firms
were founded thereafter.
22. The information in this section has been taken from various parts of two sources:.
Chandler, Alfred D., Inventing the Electronic Century, The Free Press, 2001..
Kaplan, David A., The Silicon Boys, William Morrow and Company, New York, 1999.
23. IBM is the only major producer of mainframe and minicomputers that survived the
microcomputer revolution.
24. The information in this section was taken from two sources: Barker, R., Taking stock of
Genentech: are investors overestimating its promise?, Barrons National Business and
Financial Weekly, March 4, 1985, p. 67. www.gene.com Genentechs website last
accessed March, 2000.
25. Chandler, Alfred D., Inventing the Electronic Century, The Free Press, 2001.
26. Zhang Junfu, High Tech Start-Ups and Industry Dynamics in Silicon Valley, mimeo,
Public Policy Institute of California, 2003.
27. Junfu Zhang, Easier Access to Venture Capital in Silicon Valley: Some Empirical Evi-
dence, mimeo, Public Policy Institute of California, 2006.
28. Full information can be found at: http://www.sba.gov/sbir/indexsbir-sttr.html.
Contents
Introduction............................................................................................................... 51
What is the Nature of Nanotechnology?........................................................ 53
But what is Nanotechnology?........................................................................ 53
It is often easier to relate the nature of nanotechnology than attempt to
define it................................................................................................ 53
What is Roadmapping?.................................................................................. 54
Background............................................................................................................... 55
The First Law of Small Technology.............................................................. 57
The Second Law of Small Technology.......................................................... 57
The Third Law of Small Technology............................................................ 58
The Fourth Law of Small Technology........................................................... 59
Methodology and Information Gathering................................................................. 61
Background.................................................................................................... 61
Methodology.................................................................................................. 62
Data Collection.............................................................................................. 63
Discussion................................................................................................................. 63
Conclusions...............................................................................................................66
References.................................................................................................................66
Introduction
Technology roadmaps are a type of strategic plan that attempts to align the research,
development, and application of technology with business goals. Unlike strategic
plans, however, technology roadmaps often integrate the talents of diverse stakehold-
ers to solve current problems. They help industry, its supply chains, academic and
research groups, and governments come together to jointly identify and prioritize the
technologies needed to support strategic R&D, marketing, and investment decisions.
The various definitions of roadmapping that are used will be discussed with the spe-
cial issues of roadmapping disruptive technologies. Microsystems and nanosystems
are potentially disruptive technologies, so roadmapping them is of special signifi-
cance. Disruptive technologies can redefine the competitive landscape in traditional
51
industries and create new ones. Companies and governments that ignore the impact
of such technologies do so at their peril.
Strategic roadmapping for any technology is an enormous task. This task is
made all the more daunting by the newness of a technology, the extent of its useful
industrial breadth, the choice of a firm, industry, or region perspective, and finally
the degree to which the technology either supports or tries to expunge a current
industry technology product paradigm. In this chapter, we will examine the nearly
100 years of efforts that have gone into making technology roadmaps of all types.
We recognize that roadmaps have, over this span, been a primary tool to establish
new technology into companies, nations, and regions. They have helped to give a
focus to strategic vision and policy-making for companies and governments. Numer-
ous elements comprise a roadmap, including the work of many individuals needed
to carry out the task of completing it. As a rule of thumb, the larger the audience
and size of the stakeholder group, the greater the number of participants required to
cover all interests. Furthermore, the nature of the technology under review can add
much complexity to the process.1
Nanotechnology2 is vastly different from semiconductor technology.3 Semicon-
ductor microfabrication technology is a fast-paced high technology base that has
enjoyed the same technology lifecycle curve for nearly 60 years. Nanotechnology, on
the other hand, is an emergent and often disruptive technology that has the potential
to redefine the product technology paradigm in several industries, thus making the
nanotechnology roadmapping task all that more difficult. Nanotechnology is one of
the reasons why the pace of technological change in the world is increasing exponen-
tially,4 making it difficult for strategists and policy makers to fully utilize technolo-
gies for competitive advantage.
In this introduction, we provide a view of the nature of nanotechnologies and
some useful definitions and a discussion on the formational issues of roadmaps.
Roadmapping is now an established tool. Over a number of years, many different
types of roadmaps have been produced covering almost every sector of technology.
Until the publication of the first MANCEF International Roadmap (IMR) in 2002,
there were none that specifically covered the special issues associated with the road-
mapping of disruptive technologies. This roadmap was the result of 4 years work
of more than 325 companies and 400 people from 4 continents, including most of
the major companies that are involved in the development and production of min-
iaturized components and products. Many useful lessons were learned during the
production of this roadmap, from the process of compiling it, to the differing views
and approaches made to the understanding of the technologies. In this chapter, we
shall use the MANCEF roadmap as our example since it will help the reader under-
stand the nature of miniaturized technologies and how the roadmapping process can
bring opportunities and benefits to companies and nations that want to take the path
to commercialization.
than 100 nm (e.g., nanoparticle reinforced polymers have the unique feature at ~
200300 nm as a function of the local bridges or bonds between the nanoparticles
and the polymer).8
There are many other definitions that are influenced by the geographical region
or technological environment in which they are derived, the community that is pre-
senting the concept, or other factors. The U.S. National Nanotechnology Initiative
definition is one of the most useful and explicative and can be directly related to that
used by NSET. They suggest that a certain technology can be considered a nanotech-
nology only if it involves all of the following three attributes:
What is Roadmapping?
There is no definitive definition of technology roadmaps. A number of people have
expressed their views. Robert Galvin9 states that a roadmap is an extended look at
the future of a chosen field of inquiry composed from the collective knowledge and
imagination of the brightest drivers of change in that field. Others emphasize the
ability of roadmapping to provide a vision of the future.10-15 Distilling from these, the
most useful working definition of technology roadmapping is a needs-driven tech-
nology planning process to help identify, select, and develop technology alternatives
to satisfy a set of product needs.
Expanding this, it brings together a team of experts to develop a framework
for organizing and presenting the critical technology-planning information to make
the appropriate technology investment decisions and to leverage those investments.
Given a set of needs, technology roadmapping process provides a way to develop,
organize, and present information about the critical system requirements and per-
formance targets that must be satisfied by certain timeframes. It also identifies tech-
nologies that need to be developed to meet those targets. Finally, it provides the
information needed to make trade-offs among different technology alternatives.16
Roadmapping is gaining in popularity and importance as academics and practi-
tioners are aware of the increasing importance of technology in the strategic process.17
Some strategic theories like competency-based strategies place technology and tech-
nology management as the foundation of a companys search for competitive advan-
tage. They claim unique technologies are a necessary, if not a sufficient, condition for
long-term success.18-19 Yet even as technology is recognized as critical and interdepen-
dent in a companys strategic process, this focus on technology makes the strategic
process more complex. Technology was once thought by strategists as one dimen-
sional and easy to embody in the strategic process.20 It is now recognized as multidi-
mensional and having primal influence on the strategic process. Further, some of the
important managerial aspects of technology, trends in technology development, and
sourcing are changing. For example, embodied technology capital and expense costs,
the importance of technology at the interface of disciplines, technology complexity,
the rate of technology change, global technology sourcing, and many more strategic
aspects of technology are more dynamic than ever. Moreover, the importance of long
waves and disruptive technology to regions and firms is more understood.21-23
Background
Whatever definition of nanotechnology is adopted, technology roadmapping has
become an important tool for placing technology in the management process. Today
corporations like Motorola, Corning, Phillips, and ALCOA24-27 use roadmaps as part
of their strategic process, product development process, R&D efforts, etc. Technology
roadmapping is a powerful process for supporting strategic and tactical management
decisions.28 Governments, companies, and industrial consortia utilize technology
roadmapping to explore and communicate the dynamic linkages between techno-
logical resources, organizational strategies, and the changing environment.29-30
Two aspects define the task of a technology roadmap:31 (1) the nature of the
technology under question and (2) the audience for the intended roadmap. In our
discussion, we will cover the nature of technology, utilizing terms such as enabling
or industry specific technology, disruptive or sustaining.32
Until recently almost all roadmap studies were performed on sustaining (estab-
lished) technologies that are characterized by rapidly changing (high technology)
industries such as those involved in semiconductor microfabrication or aluminum
production. Indeed, semiconductor technology invented in 1947 was disruptive. It
was not until late in the 1970s that an industry roadmap was undertaken.33 Further,
nanotechnology is such a broadly defined technology base that it has expressions,
which in some industries are disruptive, while in others are sustaining in nature.
The roadmap selection process is driven by the commercial nature of the tech-
nology under consideration and modified by the strategic nature and scope of the
roadmap project. The roadmap selection processes that have embraced enabling
technologies logically follow a series of questions that help to bind and define the
task. Questions are:
Technology bases are said to be enabling when they form the basis for solutions
that address many product technology paradigms in separate industry settings. The
semiconductor-based transistor is such a solution set. This means that the roadmap-
ping professional will have a variety of competing technologies that are specific to
the application space under investigation.
The terms disruptive and sustaining technologies are ubiquitous in the litera-
ture.36 Here, we see an example of a definition that emphasizes their utility as a con-
struct central to the issue of nanotechnology roadmapping. Disruptive or potentially
disruptive technologies can set up production platforms based on new sets of techno-
logical competencies. They create product technology paradigms that challenge and,
if successful, render useless the currently utilized manufacturing competency base
or the sustaining technology base. A disruptive technology base usually provides
a substantially better value proposition along at least two critical dimensions to be
considered commercially viable. When a disruptive technology becomes an industry
standard, it becomes sustaining in nature. Sustaining technologies are those that
underpin industry standard technology-product platforms. Improvements to these
technologies are focused on making expensive changes.
The roadmap selection process defines the parameters for the roadmap under
question. However, when you have a dichotomy that works, this is exceptionally
useful as described in the MANCEF Roadmap by Elders and Walsh.37 The problem
with nanotechnology is that it is enabling and simultaneously sustaining in some
industries while disruptive in others.38
The nature of a roadmap is further modified and bounded by its strategic pur-
pose. The following sets of constructs help to define those bounds. These constructs
include the following bifurcations:
efforts in terms of time, cost, level of effort, and complexity. Moreover, they provide
an overall differing process between a company and an industrial process. Finally,
we suggest that roadmapping processes for disruptive technologies may need to be
different in scope. In many ways, the roadmapping process has become a victim of
its own success. The process provides such value to the strategic planning of compa-
nies and regions that many have sought to apply it to technology foresight, technol-
ogy forecasting, data scanning, etc.
We now consider nanotechnology-based roadmaps. They inherently differ from
the sustaining technology-based roadmaps. Such technologies are the basis for spe-
cific technology product paradigms that set the path for major industries. The Semi-
conductor Microfabrication Roadmap (SMR) benefited greatly by the success of the
semiconductor industry that had a single technology focus. Let us consider some of
the differences between nanotechnology and semiconductor microfabrication.
The following questions raise interesting problems: Why was it so hard for
Small Tech based solution suppliers to use Moores Law43 in the same way that
semiconductor fabricators do? What does that suggest for the Small Tech based
solutions communities? Semiconductor microfabrication benefits from Moores Law.
Does nanotechnology have a Moores Law equivalent?
These problems may result from the lack of a unit cell for nanotechnology, unlike
all electronically driven microsystems that have transistors as units. If it is true that
Small Tech has no transistor-like unit cell, then this leads to a series of laws that
might suggest production space and standardization strategies.
radically in order to produce it. Further, even though there exists many ways to pro-
duce a given product, some of these will be much less cost effective and efficient.
In the MANCEF International Roadmap,45 examples are given of many process
variants for top-down and bottom-up nanotechnologies that are often specific to a
certain application area or group of applications. For example, the top 10 to 15 MEMS
companies use many similar process steps but very dissimilar processes. Texas
Instruments, Analog Devices, and Sandia National Laboratories are three leaders in
surface MEMS technologies and have been integrating MEMS and semiconductor
microfabrication for years. Yet the complexity and typology of these processes are
very different. They are different since different end users and product applications
drive them. Other industry leaders, Hewlett Packard, Honeywell, and Kulites, for
example, use other MEMS and NEMS technologies to meet their customer needs
and have not only varied processes from each other but from many of the other top
ten producers.46 Again, technology choices are driven by applications rather than
any unit cell considerations. One implication of this reality is that MEMS or NEMS
based foundries, whether commercial or captive, have a difficult time following the
semiconductor foundry model.47 Micro and nanotechnologies currently do not have
a dominant manufacturing technology as does the semiconductor microfabrication
industrys bipolar or CMOS, ensuring processes in that industry have much more in
common than MEMS and NEMS. Nano-based foundries face many more problems
than their semiconductor-based cousins. Some foundries trying to provide solutions
to a wide variety of applications have had exceptionally high development costs.
Many NEMS foundries have learned to tailor the projects they accept to meet their
existing or planned capabilities. This strategy has been used with success by such
firms as Dalsha and Colybris. Minfab in Australia has taken an islands of compe-
tence approach that has been successful for them.
This describes only the front-end manufacturing reality of Small Tech. There
are also back-end issues for Small Tech commercial solutions. Nano and micro-
based devices interact with the macro world by communicating, sensing, or actu-
ating along many different paths. Many applications require pathways to sense or
actuate in a wide variety of mediums. The importance, cost, value, and problems of
nano- and micro-based packaging are well known. Micro and nano applications that
sense differing properties have radically differing packaging requirements. This is
the base for the second law of Small Tech.
The breadth of the technology and the types of technologies in its base are
exceptionally varied.
This requires a roadmapper to be selective. For example, the MANCEF pro-
cess49 focuses on a subset of nanotechnology. Another roadmapping study
focused on Atomically Precise Manufacturing (APM). This roadmapping
requires a focus on a new, emerging, enabling and disruptive technology
base, which does not have, for the most part, dominant technology product
architectures within solution sets they provide. The MANCEF roadmap-
ping process utilized these constraints in order to deal with:
the enabling or meta-systemic nature of the markets that nanotechnol-
ogy addresses
the flexibility required of firm-based nanotechnology product platform
that companies need to develop in order to be robust and address the
uncertainties of different markets
The MANCEF roadmap process, unlike traditional ones, did not focus
solely on current or future nanotechnology but applied to a specific market
to replace a technology derived from a particular market application space.
The process also reviewed the traditional technology product paradigm in
the existing space that nanotechnology sought to replace. Finally, MANCEF
selected other competing technologies seeking to replace that same indus-
try-based technology product paradigm.50 The MANCEF roadmap process
addressed the reality of competing technology product paradigms.
The roadmap process must address not only the technological hurdles that
face an emerging industrial solution set but also be a source of confidence for
all in the emerging technology solution set value chain acting, thereby acting
as a bridge to overcome customer fear of change, the essence of the physiolog-
ical hurdles involved in managing solutions based or disruptive technologies.
Markets
Systems
Components
Technology
Time
Time
essential tool to identify core needs and to track strategic directions and were there-
fore willing to cooperate in the roadmapping exercise.
Methodology
The MNT network database and personal knowledge were used to identify and
make contact with key people and invite them to dedicated one-day roadmapping
workshops appropriate to their area of interest. About 2040 people from industry,
research organizations, and academia attended the workshops. A four-stage process
was used as represented in Figure3.2. The participants needed to possess sufficient
knowledge about the technology, the products it could produce, the existing markets
and possible future ones, and the status of business development in the fields. The
first task was to arrive at a consensus on the current status of the technology and
then move on to provide a vision of where they saw future developments and where
they believed it should go in 20 years. The following stages were to determine what
barriers there were to achieving the goals and what decisions were required to over-
come the barriers.
Time
Present Business
Where are we now?
& Activities
Example of
Post-its board
Skills
Tooling
Material Costs
Drivers
Markets Quality
People
Needs
Data Collection
Small groups numbering four to five people appointed a chairperson and debated
among themselves the key issues and answers to the following questions:
Discussion
This roadmapping process based on nanotechnology, which is an enabling disrup-
tive technology base,55 needed a new perspective on technology roadmapping. The
MANCEF roadmapping process has undergone continuous development since 1996.
This had to capture both the specific nature of the technology and also the differing
nature of the innovation process on which it is based. This means that the road-
mapping process had to capture the technology impact paradigm that describes a
technology as either disruptive or revolutionary (the manner in which a product is
manufactured radically changes, eliminating the former competencies) or sustaining
(evolutionary), which is supportive of the current technology paradigm.
Technology Creative or
New Science Push Destroying
Market Replacement
Disruptive Radical Pull or Substitute
Market Replacement
Pull or Substitute
Advances in
Science Chemistry Physics Engineering Biology
manner. These final products are often designated as replacement applications and
demonstrate how disruptive technologies can be commercialized.
Successful disruptive technologies over time become high tech sustaining
technologies. This can be seen in nanotechnology-based products such as ferofluidic
bearings for use in hard drives for computers. These were first produced by a com-
pany in the early 1980s57 and are now in use in all personal computers in the world.
One result of the MANCEF Nanotechnology Roadmap process was that no
matter how hard we tried to define what nanotechnologies were, the roadmapping
task remains difficult because at one level nanotechnology could be considered as
nanoscale science. It appears to those involved in the effort that there was more
meaningful commercial discussion at the next level down. There is a better under-
standing today for what is occurring in the domain of nanomaterials versus materi-
als, nanoelectronics versus electronics, and the like. Further review of the patent
literature suggested dominant patents in terms of citations and numbers in the areas
of nanomaterials, nanoelectronics, and nanobiology. The MANCEF Roadmapping
team focused its efforts in the development of roadmaps around disruptive and evo-
lutionary technology-based products developed integrating nanotechnology in mate-
rials, electronics, and biomedicine (see Figure3.4).
The nanoelectronics/nanocomputing industry today is dominated mainly by large
semiconductor firms and their suppliers providing integrated systems. This segment
has focused on active bulk nanotechnology advances, which include some compa-
nies focusing on atomically precise manufacturing for use in positioning and other
subsystems. Nanotechnology application examples include Zyvex partnering with
chip equipment maker FEI to bring atomically precise capabilities to their systems
and Genus with its atomic layer deposition. Further, in areas such as ion implanting,
doping, low and high K dielectric, especially in reference to semiconductor develop-
ment, traditional suppliers that extend these technologies are more likely to be the
dominant suppliers. Materials and equipment suppliers that can utilize nanotech-
nologies to improve their value proposition to the semiconductor marketplace have
annual market sales in the tens of billions of dollars.
The MANCEF group examined atomically precise manufacturing as developed
by Zyvex. The movement towards atomically precise manufacture, which forms the
basis for the utilization of nanotechnology, is being addressed in two fundamentally
differing pathways the top-down and bottom-up nanosciences. The distinctly
separate approaches are moving towards the same ultimate outcome of atomically
precise manufacturing. In the top-down realm, research is performed with an eye
on reducing the scale and feature size of existing processes. For instance, in optical
lithography approaches, used in IC foundries, feature size of less than 100 nm is
being implemented to reduce the power consumption and increase the transistor den-
sity.per.square.inch.of.silicon..In.this.realm,.we.see.the.use.of.MEMS.and.eventually.
NEMS assemblers building smaller and smaller systems. In the bottom-up realm, we
see the work of naturally occurring atomic and biological forces being utilized as the
primary manufacturing tool set. The use of ionic charges, atomic lattice holes, cata-
lytic reactions, atomic mobility, and biological selectivity are some of the numerous
forces put to work to fabricate complex atomic structures. It is in this realm that the
carbon nanotube and buckyball configurations of carbon reside (as shown in the
Conclusions
We have provided some new thinking on nanotechnology and roadmapping. We
further defined a roadmapping process based on the differing nature of technologies,
covering disruptive technology. This process is developing well, but there is still
further work to be done. What has been learned will be incorporated in the next set
of nanotechnology roadmaps.
All roadmaps seek to link technology to a single market or product or a market
grouping. Due to the nature of nanotechnology, the exact character of any technol-
ogy product paradigm is difficult to predict in advance. MANCEF has added a sig-
nificant step to roadmapping disruptive technologies that embraces market drivers
rather than markets or products.
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nanopatterning, Journal of Microlithography, Microfabrication, and Microsystems,
2006.
44. Yole, J.C., The state of the micro nano industry, Spring FIF Meeting Proceedings,
2004.
45. Walsh, S. and Elders, J., International Roadmap on MEMS, Microsystems, Microma-
chining and Top Down Nanotechnology, MANCEF, 614, Naples, Florida, 2003.
46. Linton, J.D. and Walsh, S., Integrating innovation and learning curve theory: an enabler
for moving nanotechnologies and other emerging process technologies into production,
R&D Management, 34, 513522, 2004.
47. Walsh, S. et al., Commercialization of microsystems, International Roadmap on
MEMS, Microsystems, Micromachining and Top Down Nanotechnology, MANCEF,
3368, Naples, Florida, 2003.
48. Walsh, S., Giasolli, R. and Elders, J. The second edition of the International Micro
Nano Roadmap, 674, MANCEF, Naples, Florida, 2004.
49. Walsh, S. and Elders, J., International Roadmap on MEMS, Microsystems, Microma-
chining and Top Down Nanotechnology, MANCEF, 614, Naples, Florida, 2002.
50. Walsh, S. et al., RF MEMS, International Micro Nano Roadmap (2nd Ed.), MAN-
CEF, 40152, Ch. 2., Naples, Florida, 2004.
51.. UK.MNT.Programme,.http://mnt.globalwatchonline.com.
Contents
Introduction............................................................................................................... 71
Investments from Venture Capitalists........................................................... 72
Start-Up Companies in Nanotechnology....................................................... 73
Role of Government in Nanotechnology Commercialization.................................. 73
Role of Academic Research in Commercializing Nanotechnology Products.......... 74
Technology Transfer for Nanotechnology Products................................................. 76
Intellectual Property Impact and Ownership...................................................... 76
Patents............................................................................................................ 77
Trade Secrets................................................................................................. 77
Copyrights..................................................................................................... 77
Role of the Entrepreneur, Major Corporations, and National Laboratories in
Commercialization......................................................................................... 78
Concluding Remarks................................................................................................. 78
Internet resources...................................................................................................... 79
Introduction
Technology transfer from universities is largely dependent on support from govern-
ment agencies, private investors, and corporations. Investment decisions are a major
force in how nanotechnology develops, and this is dependent upon the support from
government, academia, private investors, and corporations. Nanoscale science and
engineering activities are growing in the U.S. The National Nanotechnology Ini-
tiative (NNI) is a long-term research and development (R&D) program that began
in 2001 and coordinates 25 departments and independent agencies, including the
71
than 80% of the companies are expected to have nanoproducts by 2010 and 98% in
the longer term. Therefore, the role of academic research will play a significant part
in this growth.
Patents
Utility patents offer protection for inventions that can be classified as a novel process
or method, or a piece of apparatus that is useful and nontrivial. The exchange of the
idea for protection seems obvious but may also alert the world of the idea. However,
under U.S. law, the patent is protected for 20 years and prevents others from making
and selling the invention contained within the patent. Once granted, it is essential
that the patent is protected so that maximum returns can be made from the patent.
A strong patent with a solid portfolio can be the foundation of creating wealth from
a nanotechnology patent. Protecting nanotechnology-based patents may be difficult
because not all of the knowledge is known to protect it from being exploited by other
nanotechnology players. Because nanotechnology is interdisciplinary, it is more
difficult to create a novel patent because it may be on a different scale. Therefore,
only partial protection can be guaranteed. Therefore, the decision to protect the idea
using patents must be considered very carefully.
Trade Secrets
A nanotechnology company can also use trade secrets to protect its intellectual prop-
erty through the use of trademarks. As of 2005, approximately 1800 trademarks
containing the word nano have been registered and are pending. Trade secrets can
be indefinite unless publicly disclosed. They can be revealed if the product is reverse
engineered. However, because of the scale involved, it may be difficult to reverse
engineer a nanotechnology product. Hence, trade secrets may work if employees
maintain confidentiality even when they leave the employ of a particular company.
The employment of nondisclosure agreements may also be useful, especially when
employees move from their original employment with the company.
Copyrights
Copyrights protect the idea, which is not the case for patents. Protection under copy-
right protects the idea for up to 100 years for work that is made for hire. This is the
case for nanotechnology industries.
The case for patenting appears to be self-defeating compared to trade secrets
and copyright protection. However, filing a provisional patent as opposed to a utility
patent does indeed show to potential investors that the patent is pending and also
who the inventor is. This last statement is interesting in that in the U.S. the patent
system is based on a first to invent standard rather than first to file standard. This
is unique to the U.S. and does not exist in other countries. The process of filing a
provisional patent is simple, inexpensive, and announces the origin of the invention.
A provisional filing also preserves the right to foreign filings.
The restrictions on innovation may stem from patent filings. This may be due
to the narrow scope of the inventors claims in the patent or to the way that the
research was initially funded. If the patent is borne out of government funding,
then the government can issue a royalty-free license to the inventor of the patent.
This provision was made under the 1980 Bayh-Dole Act and gives universities and
small business entities freedom to commercialize the invention at no cost. However,
innovations that stem from the invention are still governed by the original license,
which may cause problems if the business is sold to a third party after the patent
and license has been issued. The issue of developing an intellectual property policy
and its impact can take many different forms depending on the short-, medium-,
and long-term goals of a nanotechnology business. However, combinations of using
patents, trade secrets, copyrights, and trademarks can ensure that businesses create
revenue streams over differing time scales.
Concluding Remarks
The National Nanotechnology Initiative has done much to fund the research and
development needed in U.S. universities to commercialize nanotechnology prod-
ucts. However, the commercialization of nanotechnologies for U.S. universities is
dependent upon research teams and their relationship with offices of technology
transfer at their home institutions. Although funding is well supported by many
U.S. government departments, commercialization is left in the hands of the busi-
ness relationships made between the research group, offices of technology transfer at
universities, and the private sector. Further strengthening of the commercialization
route may be necessary in the future if nanotechnology products are to become more
widespread in our society. Governments need to address this problem owing to the
amount of resources that need to be provided to fund research and developments in
nanotechnology.
Internet resources
http://www.osha.gov
http://www.cdc.gov/niosh/
http://www.epa.gov
http://www.niehs.nih.gov
http://www.fda.gov
http://www.nano.gov/NNI_Strategic_Plan_2004.pdf
http://www.nnin.org
http://ncn.purdue.edu/
http://www.cpsc.gov
http://www.nanomanufacturing.eu
Contents
Introduction............................................................................................................... 82
Mesa+ Institute for Nanotechnology Within the University of Twente.................... 82
Setting the Stage: Micro-Nanotechnology, Commercialization, and Cooperation.. 83
Dynamics in the Field of Micro-Nanotechnology.........................................84
Cooperation in a Triple Helix of Academia, Industry, and Government...... 86
The Role of Public Research Organizations.................................................. 89
Entrepreneurs and Venture Capitalists..........................................................90
The Role of the Regional Government.......................................................... 91
Creating the Right Structures...................................................................................94
Accommodating Your Organization.............................................................94
Creating Facilities with a Common/Shared Interest.....................................97
Networks........................................................................................................99
Inspiring Culture..................................................................................................... 100
Accelerating the Commercialization Process......................................................... 102
Conclusions............................................................................................................. 103
References.............................................................................................................. 103
81
Introduction
In this chapter, we focus on the issues associated with forming and maintaining a
collaborative partnership between three main parties, academia, industry, and gov-
ernment, in the building of a suitable commercialization infrastructure for micro-
nanotechnology. Our experiences are based on the work of the MESA+ Institute, a
research and development center in the Netherlands. First, the work of the institute,
its history, and the importance of its location in the region will be described. We
introduce the Triple Helix1 model as our concept to describe the respective roles of
the partners, their interactions, and the contribution that each makes. This is cen-
tral to the successful implementation of a commercialization strategy. Subsequently,
practical recommendations and experiences from MESA+ will be discussed.
that would not just provide students with an academic education but would also be
able to attract a significant amount of high-tech firms to the region. In line with this,
the University of Twente implemented a number of technology transfer schemes to
support the commercial exploitation of knowledge acquired through industry-related
research projects. Examples of such schemes are the Temporary Entrepreneurial
Positions Programme (TOP), a Business and Science Park, later developed into a
broader Knowledge Park, and the Holding Technopolis Twente, a limited com-
pany that acts as a holding company for university participations. Recently the uni-
versity structured all its internal commercialization processes in the Innovation
Lab Twente. The university is very successful with its TOP program. This scheme
offers an interest-free loan, office space, advice, training, marketing, and financing
strategies to start-ups that are planning to use knowledge produced at the University
of Twente. These and other schemes and institutional arrangements have made the
University of Twente a central partner of the provincial government and regional
development agency.3
The University of Twente and MESA+ play an important role in creating a
regional cluster of companies, academic research communities, and a well-educated
workforce. Since 1980, the university has spun out some 600 new firms, leading to
approximately 6000 direct jobs. During the last 15 years, MESA+ spun out some 35
technology-based companies. The new jobs created by these companies generate an
improved economic climate for the region.
The activities of MESA+ and the University of Twente described above must also
be seen as part of the activities of other players in the region, i.e., the regional, pro-
vincial, and municipal governments whose primary objective is regional economic
development. They hope to accomplish this, among other things, by supporting orga-
nizations and networks dedicated to commercialization. Two examples of regional
network initiatives that have been developed in the region are: TKT (Knowledge
Kring Twente), a network of high-tech companies that exchanges information for
the improvement of high tech businesses in the region. TNKO (Twente Network for
Knowledge-Intensive Entrepreneurship) is a network for knowledge-intensive entre-
preneurs in their starting phase. A list of such initiatives and other organizations
is given by Mensink et al.4 Recently, Kennispark, another initiative, was founded
to specifically improve the economic cluster around the campus of the University
of Twente. Partners that cooperate in Kennispark range from the TKT network to
the regional development agency, i.e., Oost N.V. as well as the college in Enschede
(Saxion Hogeschool) and the business accelerators of the University of Twente. The
Innovation Lab of the university is an integral part of Kennispark. Kennispark is
cooperating with other partners in business, higher education, and government.
to collaborate with each other in order to succeed. In this section, we will explore the
nature of commercialization in the field of micro-nanotechnology.
sectors. University technology transfer offices therefore employ people with a range
of experience and expertise in areas such as customer relations, IP, legal issues, etc.
In the more chaotic environment of potentially disruptive technologies, with their
uncertain development paths, a completely different approach to technology transfer
is required. First, there is no predictable development path. Roadmaps tend to dis-
cuss potential use of a technology rather than define technological steps to product
evolution. Business development in new or young enterprises therefore is a combina-
tion of business sense, strong networks, and a profound knowledge of the technology
and its development. Technologists have to be aware of the potential impact of their
work; they have to understand the product environments and be aware of the fact that
they provide just a partial solution to someones problem.
If a company is a supplier of a potentially disruptive technology, then it will
probably not be successful in building relations with other companies in the same
market sector. Leaders would not be interested in a development that has a potential
of challenging the current market paradigm. They would tend to use such a company
as a gatekeeper rather than a supplier. Companies that are interested in commercial-
ization tend to be those looking for unique opportunities for growth or sustainability.
Disruptive technologies influence the approach made toward technology transfer:
ideas have to come from the interaction of people focused on applications and mar-
kets with the people focused on technology development. Because there are no clear
roadmaps, ideas and knowledge exchange is not structured. Therefore, it is essential
to create as much interaction as possible between the product and market strategists
and the technologists. Opportunities, solutions, and new fruitful ideas are built on
the combination of the two. With an absence of structured roadmap processes, one
has to rely on intense daily contact (coffee table and lab floor) to maximize the
transfer and the growth of new ideas. Technology transfer becomes a body contact
sport, so maximize the chances for body contact.
The characteristics of the industrial landscape in the micro-nanotechnology
community are related to the above mentioned dynamics. Apart from a number
of large-volume applications taken up by the existing value chains (ink-jet printer
heads, hard drive head systems, micro-mirror devices for image projection, etc.), the
field is a gathering of smaller entrepreneurial companies; therefore, the learning pro-
cess is slow. Many organizations actively support their members in accelerating the
learning process through better understanding of the market and industrial process.
Such organizations are focused on a particular technology field (i.e., the Institute
of Nanotechnology, UK (i.e., MIG, MEMS Industry Group, or IVAM Germany),
and on commercialization, MANCEF (the Micro and Nanotechnology Commercial-
ization Education Foundation). In this system, production infrastructure is either
focused towards one of the larger applications mentioned above or has the difficult
task of integrating various technology platforms and acting as a foundry for different
customers.
We expect a further maturing of the field, leading to increased standardization,
but at the same time expect parts of the field to continue to be based on a wider
set of technologies, expressing themselves in different combinations in products.
In that regard, the field of micro-nanotechnology resembles the field of precision
engineering rather than semiconductors, where a unit cell for design and produc-
tion is established at a very high technological level.
We have tried to show that a commercialization process is not only shaped by its
technological possibilities but also by the players that are present or not present in
the innovation process. Our message is that an optimized commercialization process
takes into account the differences in the role that the technology can play in different
product applications, e.g., chip-technology in an existing microsystem technology
regime or for an application in a laboratory analysis setting. We feel that players who
are linked to the process of commercialization, i.e., research groups, universities,
private industry, and local and national government, should be aware of the needs of
commercialization trajectories and their respective role in the trajectory. Below we
discuss the use of the Triple Helix of university-industry-government concept as a
process for cooperation.
that is recognized in the public arena. They are task driven and usually receive a basic
budget from a public authority to perform that task. Its management decides on the
basis of many issues, societal issues (setting the right example, stimulating the desired
long-term development, etc.) from to political or financial issues. The stakeholders are
many and are represented in long decision chains with often a strong democratic input.
A private activity receives its income from its activities in the market; its management
decides in line with the desired strategic development of the enterprise in the market,
so decision chains are short. Interestingly, a well-chosen public activity will address a
need. Such a need could be translated into market in a private setting. Indeed, many
public activities could be considered for privatization. As a result of that, the rules for
running that activity will change, and the character of the organization will change.
This usually leads to a larger economic transparency but less societal embedding.
In between the public and the private set of rules, an abundance of minefields and pit-
falls exists. Many public-private partnerships have shown the problems related to the
marriage of the two. Public entities can cooperate with private ones and vice versa,
as long as it does not force one into adopting the rules of the other. If the basic set of
rules for the public or private environment is not damaged or corrupted, the different
parties involved can keep their integrity and strength and work from that into a fruit-
ful cooperation.
In every western country, there are numerous examples of the emergence of
hybrid organizations among the Triple Helix parties, such as university incubators
established to support start-up companies that are based on academic knowledge.
Science parks are founded to create geographical concentrations of industry and
academic research; they do encourage spin-off companies themselves and can be
considered hybrid organizations, i.e., companies with primary interests in wealth
creation but stemming from an organization with a dominating interest in new
knowledge and often partially owned by the universities themselves. It is these types
of organizations that are trying to cross inter-organizational boundaries, stretching
and merging different roles. And these organizations, like spin-offs, science parks,
or mixed industrial-governmental interest groups, are important bridge builders in
the collaboration process.
Intermediate companies or organization are often embedded into a stakeholders
organization, with a task to build relationships with the other partners. Due to the
nature of the industrial community, the host of the intermediate organization is often
a public stakeholder, either a government or a research institution. It is rare for pri-
vate companies to be recognized as intermediate organizations. If so, they act on
the basis of a clearly defined business model. The most successful ones are active in
the intellectual property field; the British Technology Group is one such example.
Where a public research organization has the role of primary player, a number of dif-
ferent forms are found, ranging from a Technology Transfer Office through sharing
of facilities and start-up support programs to forms of active business development.
Examples are many, including the commercialization policies of organizations like
Forschungszentrum Karlsruhe GmbH (FZK), Institute of Microtechnology Mainz
(IMM), Institute of Nanotechnology Exploitation (INEX), and MESA+. In some
cases, we see authorities or mandated bodies taking the role of primary partner to
initiate a commercialization structure. Examples are Centre Suisse dElectronique
In all of these examples, the relevance to the companys bottom line is clearly visible.
Such schemes tend to be strong and sustainable after a first period of public support.
joint financial commitment of all parties, a fund of 200 million euro has been made
available (50 from the province, 50 from the municipalities, and 100 from industry)
to support a regional innovation agenda, which was conceived in an intense interac-
tion between the field and the Innovation Platform. The result is an increased com-
mitment, an improved vision on the development of the region, a stronger lobby, and
a joint agenda coupled to relevant funds.
The Twente region, as well as all other regions in the world, has the challenge not
only to create vital economic clusters by intertwining commercialization and inno-
vation activities of the different actors but also to create the boundary conditions for
vital clusters. Creating a density of talent is one of the most important ones besides
a good logistical as well as knowledge infrastructure. This density of talent relies in
large part on the quality of life a region has to offer. Although the Twente region is
not well known for its high-paid and high-vacancy rate of jobs, the region has the
benefit of relatively cheap housing in relation to the more densely populated territory
west of the Netherlands and has an excellent quality of the environment.
A very distinct feature of authorities is their risk aversion mentality. Whereas
risk is an intrinsic part of private enterprise and academic work, public authorities
are pressed by the population not to waste taxes on risky support schemes or other
instruments that have the potential to fail. There is a very moderate incentive for
success but a very large negative incentive for failure.
Considering the interests of regional governments in the creation of wealth and
jobs, miniaturization technologies compete with other technologies and with policies
and initiatives of a very different type, such as roads or business parks. Authorities
will generally be reactive on a given subject: there will have to be a clearly expressed
need or desire, especially including the industrial community, before policies will
be defined. Regional authorities often have a more hands-on approach and can relate
more closely to a certain application field or technology. For the long-term sustain-
ability of an initiative, the continued support of authorities is very important. This
support in time should shift focus from financial support for R&D or for commer-
cialization policies towards general support initiative. For the public research organi-
zations and the industry, this implies that there has to be a visible evolution towards a
mature economic cluster to ensure further support. If there is no visible success on a
relatively short term, say two to three years, governments will become very hesitant
to invest further in innovation in certain areas. One reason for this hesitation to com-
mit to these long-term processes is the nature of these democratic systems that are
more inclined to doubt and subsequently to call off succeeding investment steps or
change directions. Of course industrial partners and public research organizations
have this as well, but the perseverance in certain activities can deteriorate very fast
if no visible progress has been made. And one needs to develop strategies that take
into account these needs of governmental partners if one wants the government to
support certain schemes.
In the text above, we have tried to stress the interrelatedness of commercializa-
tion activities by discussing the importance of collaboration in the commercializa-
tion of micro- and nanotechnology. We feel that parties should be aware of each
others respective roles in the commercialization process and construct long-term
shared strategic goals. Engagement in commercialization activities by every party,
Risk/Sustainalibility
Buy-in Government
Market Orientation
R&D Funds
Funding
support)
Infrastructure
Development + 0 ++
R&D and Start-up
Programs N/A + + ++ 0 +
IPR Brokers and Business
+ 0 0 + 0
Primary Actor
Developers
Private
Privately Funded
Commercialization Entities ++ 0 +
Private/Public Joint
Ventures + ++ ++ 0 0 +
and industrial parties to overcome individualistic goals and to let the different inter-
ests converge on a collective level. The trick here, however, is to let the partners
build towards these collective agendas, not to bend them in types of ways by forcing
them to do things they would otherwise not do or are not particularly well equipped
to execute.
Below we will take some ideas to a more mundane level by putting forward a
number of observations and suggestions based on experiences from MESA+. These
observations and suggestions deal with structural and cultural aspects in the col-
laboration process as well as some remarks on the acceleration and the smoothening
of the practice of commercialization in the micro-nanotechnology field. Because
the observations and suggestions originate from experiences at MESA+, most of the
mentioned points will put forward MESA+ as a dominant entity in the support of
collaboration among academia, industry, and government. This, however, should not
persuade our readers to think that the academic community should have a dominant
role in the support of collaboration. We once again would like to refer to Figure 5.2,
this time to show that multiple types of partners can have a more or less leading role
in building towards the other partners.
parties, mainly industry, it should be clear as well what can be expected from the
research institute.
Often, a private enterprise wants more than described above. It would like
some exclusive issues and guarantees that support its continuity or limitations for
the research organization with respect to its relationship with other parties. Such
items have a chance of exerting a considerable amount of stress on the relationship.
Therefore, the basis of the relationship, as well as the reasons why the other partner
is engaged in the relation, should be well understood by both sides. If so, the relation-
ship can withstand a considerable amount of stress around these additional items.
We have developed a participation procedure in which the research group takes
a share in the starting company in return for patents, licenses, and other forms of
rights with respect to R&D results in a certain technology-market intersection. Such
an arrangement evens the way for fruitful communication and cooperation without
interfering with the core tasks of each partner. As a basic rule, we make sure that a
financing partner is also involved as a shareholder.
With all this we aim to create a stable environment in the early, vulnerable
stages of a company. It also prevents the so-called transfer barrier, where people are
very willing to assist the young entrepreneur, but from the moment a profit is made,
researchers tend to guard new and interesting ideas and findings. Why should the
company make money with my ideas? MESA+, in this case, uses different combi-
nations of the following:
In each element, a considerable effort has been made to minimize the possibil-
ity of stress and keep the core of the arrangement in place. Separating low-stress
issues from high-stress issues is the most important aspect of building long-term
relationships with your industrial partners. This allows both parties to keep a posi-
tion of excellence in their own fields and concentrate on core competencies and pro-
cesses. The new relationship should not constrain the core activities of the research
institute or the industrial partner. Therefore, any combination of the elements men-
tioned above will form a relatively stress-free basis for cooperation. Parties can
respect and assist each other on this basis. Potentially stressful additional items can
be added on top of this basis to fine tune the relationship.
Furthermore, organizations should keep all arrangements limited in time, topic,
and personnel:
These basics will prevent proliferation of rights and will allow for restructur-
ing the relationship in time. MESA+ usually uses 3-year periods. This also allows
the public research organization to be a partner in a future financing round.
Alongside the points that are mentioned above, which concern the more process-
related improvements, the aspect of coordination has been very important in accom-
modating the research institute to acquire a more commercialization-aware stance.
As we have emphasized before, low- and high-stress activities should be separated
from each other, and commercialization activities should never compromise the
core activities of researchers in a public research organization, since this will pose a
threat to their excellence. This was a heavy weighing argument in the coordination
of the commercialization activities throughout the MESA+ organization. MESA+
has concentrated the coordination and support around commercialization on a cen-
tral level. The organization employs a technical commercial director who is respon-
sible for commercialization and business venturing activities. Recently, a technology
accelerator has been set up centrally by MESA+ to scout and implement new micro
and nanotechnology business cases. One of its most important goals is to obtain
commitment from governmental, academic, and industrial funding sources. This is
one of the examples where commercialization activities are placed in close coopera-
tion with, but organizationally outside, the core academic process so as not to com-
promise the research process. At the same time, these types of structures enable the
organization to devise a central mission statement and structure that emphasize the
commercialization of knowledge that is produced within the institute.
The actual business development process is run in very close cooperation with the
decentralized level (the work floor). It is the researchers who can see the potentials of
new technologies as well as possible technological hurdles. The central staff (techni-
cal-commercial director, technology accelerator) will support the work floor in their
ideas and plans to valorize a part of their research. This supports the commitment to
the commercialization process and aligns strongly with the disruptive character of
micro/nanotechnology commercialization processes, which require a strong mutual
involvement of entrepreneurship and technology development (commercialization as
a body contact sport). Through this organizational scheme, the whole chain of tech-
nology development through to commercialization and entrepreneurship remains
strongly linked, from idea generation through to spin-out and growth.
This decentralized approach is powerful, since it allows every single person in
the organization to understand his or her added value and importance to the com-
mercialization process, instead of the universitys technology transfer office alone.
One way to accommodate this understanding is to devise processes and structures
that support commercialization and are carried by the central organization and the
research process. These efforts in turn will provide the organization with a frame-
work to work from and consequently will contribute to a culture in which commer-
cialization will become a more and more obvious part of the research process, not so
much in the daily work of research but as a point of attention that one keeps in the
back of the mind and the development of the skills to cooperate effectively. Cultural
aspects will be discussed in more depth in the next paragraph.
The use of MESA+s existing R&D facilities for development and/or produc-
tion. The user of the facilities pays a full-cost tariff per unit of time used.
It is in the interest of both parties to increase the use of facilities. In their
investment strategy, the public research organization will therefore take the
interests of the private users into account. In normal operation, we will grant
equal rights to a company user compared to a public researcher to prevent a
double standard. In the exceptional situation that conflicts arise (e.g., break-
down of equipment, fully booked equipment), this principle will be main-
tained as long as possible. If this is impossible, the public users will prevail.
The use of technological facilities by company personnel is standardized
and embedded as an integral part of the activities in the central labs of
MESA+. This leads to a turnover in man hours of almost 30% by start-ups
for the clean room labs. This number is still climbing. Also, dedicated clean
room space and offices for the companies themselves have been realized.
This indicates the mutual dependency and trust that has been realized over
the past 15 years.
Co-investment in equipment. This allows the exploitation of a wider equip-
ment basis. We make sure that the equipment is owned by the most relevant
party and will grant rights of use to the other party for a rent based on integral
cost that takes the co-investment and the strategic cooperation into account.
Sharing of offices and buildings. Being close together and meeting one another
on a daily basis is a very strong catalyst for new ideas and mutual enrichment.
By using the same physical environment, this closeness is supported. We
observe a growth in information exchange and cooperation on different levels
and an increase in new business ideas, to the benefit of both parties.
Keeping the channel of new publicly available knowledge and know-how
open. Companies as well as research organizations have a variety of know-
how and knowledge that is, in principle, open to the public. Opening up
communication on these issues in an early stage will help both sides to
increase their general knowledge base. This process counteracts the com-
petitive shielding of information between companies, or the transfer bar-
rier within the academic workplace, discussed above.
services, etc., are identified and defined for further development. This master plan is
an important guideline for all future building developments and plays a central role
in acquisition of new companies. The Business and Science Park was put in place
25 years ago to foster high-tech economic development around the university. In the
Kennispark concept, it is integrated with the campus, which already houses some
100 small firms.
The second part of that development is a 40,000 m2 joint facility for companies
on the edge of the university campus and directly adjacent to the universitys core
facilities, such as the clean room and the biomedical labs. This joint facility allows
companies to build their joint labs and develop themselves in an optimal environ-
ment. The building is run by external parties and is developed as a project adjacent
to the university, not as part of the university. This building is the core of all future
facility sharing activities.
The Kennispark concept already houses a number of incubator buildings run by
the Business Technology Center (BTC), a private company owned by the regional
development agency, a project developer, a bank, the municipal college Saxion, and
the University of Twente. In its 25 years of existence, it has been extremely success-
ful in fostering new business development.
Networks
Networks are another crucial addition to the regional environment. While emphasiz-
ing networks, we will again start with the organization itself and move on towards ini-
tiatives that are more externally structured, i.e., national and international networks.
The networks that MESA+ focuses on are networks of experienced entrepreneurs,
networks for finance, and networks that support crucial information and experience.
In the area of experienced entrepreneurship, Kennispark, joining efforts for all
commercialization activities in the area, has a number of partner networks. First
of all, there are a number of company associations that create a relevant environ-
ment for starting and growing entrepreneurs. The Technology Circle Twente TKT,
for instance, binds together some 150 technology companies that have a relation
with the university, mostly as spin-offs. TKT offers joint interest groups, contact
with experienced entrepreneurs, information on relevant technological fields, sup-
port for acquiring new personnel, etc. A new and interesting effort here is the Mind-
shift program that could be explained as experienced entrepreneurs helping young
entrepreneurs.
On certain relevant technology areas, we find TIMP, a group of biomedical com-
panies that offer a package in the market, or MINACned, the Dutch Micro/Nano
Cluster, founded by MESA+ in the late 1990s. For MESA+, the Dutch National
Nanotechnology Initiative NanoNed and the Microtechnology Initiative MicroNed
are relevant networks that encompass many research groups next to large groups of
active companies in the field of MNT.
All of these networks are linked into the regional system and actively supported.
The network for financing revolves around a number of key organizations and key
persons. The most relevant organization is the Participation Fund East Netherlands,
a public fund with a section, Innofund, devoted to seed financing. This fund links
into several other financing parties and angel networks. Through some individuals
and especially some of the Technology Accelerators (on-campus business develop-
ers), private persons from the financing community are linked into the system. Ken-
nispark and MESA+ actively support these relations. One of the reasons to do so is
to make the various properties of the Twente system known to the financing com-
munity. This lowers risk perception and increases deal flow. This is done through
various topical meetings and programs.
Finally, MESA+ invests heavily in international networks that support both
research and commercialization. The research network partly is oriented towards
other large institutes that have a strong national role and combine research with com-
mercialization. The most prominent network in this regard is based on the link with
the National Institute for Nano Technology (NINT) in Canada and is linked with
the California Nanosystems Institute, the University of Tokyo, and the Korean Insti-
tute for Machinery and Materials. This network focuses on the research community
and helps define regional and international programs that support multidisciplinary
research and commercialization activities.
A strong relation exists with MANCEF, the Micro and Nanotechnology Com-
mercialization Education Foundation. MESA+ has always been a strong supporter of
this foundation, for a number of reasons: increasing the speed of learning, increas-
ing the value of international networks, and increasing the visibility of the MESA+
commercialization effort.
Inspiring Culture
One of the key ingredients of a strong commercialization community is the internal cul-
ture. The culture should support ambition, risk taking, and cooperation. It should enable
all parties to recognize mutual added value and support respect and trust. These ele-
ments will form the basis of a strong, result-oriented culture for commercialization.
Creating a culture in which parties can see the relevance of commercialization
and can see the relevance of investing in relations that do not produce immediate
yields can be quite challenging. In MESA+ this has been a long-term process in
which developing support structures on a central level has been quite helpful. By
supporting bottom-up initiatives and communicating possibilities of commercializa-
tion top-down, awareness can be created on the shop floor.
Key components in creating such a culture have proven to be the following:
A long-term relationship is the obvious and ultimate goal if one wants to build
a vital cluster. Trust and courage in this respect play a significant role. Creating
networks and collaboration structures among entrepreneurs, researcher organiza-
tions, and authorities is a question of trust. Without this trust nothing goes. This
trust, however, is a long-term commitment process where small steps in initial stages
lead to more and more trust over time. Only after a while, when trust has been
established, will partners dare to have the courage to take the risk that is needed for
progress. Showing courage within a larger organization also points towards the need
for leadership commitment and the need for strong key persons in the organization.
Entrepreneurs within an organization, backed by long-term and visionary support
from upper management, are needed, especially on the side of academic institutions
and authorities. The above-mentioned risk-averse nature of such organizations often
prohibits such an attitude. The stronger the cooperation and joint vision that is in the
Triple Helix cooperation, the bigger the space will become for entrepreneurship and
courage in the process.
Creating a culture on the university level is something that definitely has played
a role in the story of MESA+. In the 1980s, the term entrepreneurial university
meant to focus more on external funds to create income for education and research,
not commercialization per se. In the 1990s, MESA+ was mostly engaging in facil-
ity sharing as a form of entrepreneurial activity, which occasionally also saw the
emergence of new companies. Facility sharing in these times was mostly seen as
a way to earn some extra money to help carry the heavy load of cleanroom facili-
ties. Around 1995, however, people began to see the importance of facility sharing
beyond this very direct income benefit and saw the other advantages as well: know-
how exchange, inspiration for business cases or research programs, etc. Facility
sharing contracts became increasingly bigger and took the interests of the companies
involved more into account. Furthermore, not only did MESA+ rent equipment to
others, sometimes equipment was hired by MESA+ from others. MESA+ started to
rely on other partys equipment instead of reinvesting itself. In the early 1990s, enter-
prises that were spun-out for the most part were based on creating interfaces between
existing industry and the university for access to techniques and facilities. Twente
MicroProducts for instance was a company that initially started as an interface-like
foundation. By the year 2000, it had developed towards a mature and separate entity
with a distinct business model and separate products. Since the mid 1990s, indepen-
dent new businesses, based on products in growing markets with a solid financing
structure and business model, have become a central point of attention at MESA+.
This step could only be taken after MESA+ found ways to understand the dynam-
ics of such companies and ways to structure its relationship with these companies.
Illustrative for this change in mindset is the European Membrane Institute that was
established in 1995. The Institutes main purpose is to offer industry and public
business development activity has shown a number of weaknesses in the rest of the
system that could be improved to the benefit of many of the parties involved.
Business developers can play a significant role in the early stages of spinning
out ideas. These initiatives mostly do not rely solely on the proactiveness of indi-
vidual researchers, but scouting new ideas is an important part of the activities. The
MESA+ business developer has set the following goals:
Conclusions
Experiences at the MESA+ research institute illustrate that it is important to take
into account the different natures of the three types of parties involved in the collab-
oration process. Different parties have different roles and natures, and other parties
should understand these roles. On the other hand, parties should not indiscriminately
persevere in sticking to their natural roles. Since their interdependence in the com-
mercialization process and in the creation of a vital regional cluster is undeniable,
building shared long-term agendas is, in our view, the most efficient and produc-
tive approach. Public research organizations as well as governmental partners can
nevertheless initiate their own programs and support structures. They should, how-
ever, keep in mind how the next step can be made in the commercialization process
towards viable business cases. The whole commercialization process for all the par-
ties is one big learning experience that takes time, effort, trust, and courage. It is
not only a learning process for the public research organization itself, which tries to
commercialize its knowledge, but also a learning experience for the governmental
bodies and industrial sector partners who can benefit from increasing collaborations
and more optimized tuning of activities among different organizations.
References
1. Leydesdorff, L. and Etzkowitz, H., Emergence of a triple helix of university-industry-
government relations, Science and Public Policy 23, 279286, 1996.
2. Clark, B.R., Creating Entrepreneurial Universities: Organizational Pathways of
Transformation. International Association of Universities and Elsevier Science, Paris
and Oxford, 1998.
Contents
105
Our goal in this chapter is to make more visible the MEMS/MST business and
provide accurate data on MEMS and MNT markets, business trends, and industrial
strategies. The MEMS field is an industry with its own rules, technologies, road-
maps, equipment, and materials manufacturers.
I am using the following definitions in this chapter:
Only stand-alone MEMS components, not the global system that includes
the MEMS devices.
Volumes and prices are for a packaged MEMS (including or not electronics
according to the component technology).
First Level
Packaged
Silicon Sensing Packaging Operations Devices =
Element Asic Component
(hybrid approach)
TO-8
SIP Or with Long Distance
Amplication =
Transmitter
Figures6.1 and 6.2 give an explanation of the words we are using in the rest of this
chapter. All our analyses are based on components (i.e., first-level packaged device).
12,000
-fuel cells
RF MEMS
Microfluidics
10,000
MOEMS (incl. DMD)
Gyroscopes
Accelerometers
8,000 Silicon microphones
Market in $M
Pressure sensors
Inkjet head
6,000
4,000
2,000
0
2005 2006 2007 2008 2009 2010
Figure6.3 (See.color.insert.following.page.16.).Value.of.the.MEMS.markets.
Table6.1
MEMS Markets 2005-2010
2005 2006 2007 2008 2009 2010
diagnostic, not reported here. We expect that the MEMS markets will reach $9.7 bil-
lion by 2010, representing a compound annual growth rate of almost 15%. The value
of each of the major MEMS market is shown.
Our forecast 2006 was little higher in 2005 (we estimated a 2005 market at
$5.6 billion). The main difference comes from a decrease of Texas Instrument sales
(8%decrease compared to a forecasted 20% growth) and an adjustment of the value
of the industrial pressure sensor market.
In recent years, the MEMS industry has seen several important evolutions:
Device manufacturers are more and more often proposing modules in order
to add value (for example, TPMS compared to pressure sensor).
Enhanced development of consumer applications.
Strong development of contract manufacturers and foundry business, aver-
aging more than 35% growth.
Strong M&A activities with creation of new important players (acquisi-
tion of BEI Technologies by Schneider Electric, including Systron Donner;
acquisition of First Technology by Honeywell; and a series of acquisitions
by measurement specialties).
Changes in the manufacturing policies of several key players (introduction
of the new permanent ink-jet head by HP, for example).
Ink-jet head markets: growth of the market value will eventually reach sat-
uration around $1.8 to $2 billion. However, the number of devices sold will
decrease strongly due to manufacturing changes at HP with the introduction
of the Scalable Printing Technology (SPT); the HP heads are not disposable,
and the new head is big and helps create faster and more precise prints.
Pressure sensor: the growth of the medical and automotive business is
stable (around 12%). New applications like the Tire Pressure Monitoring
System for cars are boosting this market (and Infineon/Sensonor account
for the majority of this growth).
Silicon Microphones: the market has seen almost 100% growth in volume.
Knowles Acoustics, with 100 M units sold, is the only player producing in
volume at the moment. SinionMems, Memstech in 2005 and Akustica in
2006 now have devices available, and 2006 was a year of price pressure
with another 100% growth in volume.
Accelerometer: the acceleration sensor market has evolved considerably.
The automotive business is increasing rapidly with the growth of the Elec-
tronic Stability Program (ESP) (main players are VTI Technologies and
Bosch). Consumer applications have started to use MEMS sensors in vol-
ume applications, including mobile phones (human machine interface, acti-
vation of logos, etc.), GPS, and pedometers. The number of new systems
using the accelerometer is very important, and we think the market has
great potential. The ability of device manufacturers to make profit out of
these applications is another story as price pressure is very high.
Gyroscopes: here also, there has been strong growth of the overall market,
due to different applications. The ESP market is growing very fast, with
adoption of the system in medium-end cars. Silicon and quartz devices are
competing on this application. GPS is another growth area, both for auto-
motive and autonomous systems (stand alone or within two years included
in a mobile phone). We have also seen a strong development of silicon-based
Since 2004, a key event has happened. The mobile phone industry is looking at
the use of MEMS devices and linked technologies in order to bring new functions and
solve key problems. The MEMS applications range for mobile phones is quite large:
The functions to be integrated in the mobile phone are very important, i.e.,
replacement of the ECM microphone, new human machine interface, RF module
with more frequency agility, new optical and image capture functions, positioning
systems, identification, and new long lifetime batteries. At long last, MEMS devices
are now methodically entering into the mobile phone business, offering key devices
in order to leverage these new functions.
The applications of these different devices are quite diverse and are enabling
interesting technology features and, at times, are pure gadget. The applications and
markets for MEMS in mobile phones were close to $2 million in 2004 and will go
up to more than $250 million by 2008. The volume applications in 2005 were the 3D
accelerometer for human-machine interface (volume sales at Analog Devices, MEM-
SIC, VTI Technologies, Freescale, and several other companies in North America,
Europe, and Japan) and silicon microphones.
There are several important considerations that MEMS devices still need to
address in the consumer markets:
One of the key challenges for the mobile phone industry is price pressure. The
price of MEMS devices has to be in the range of a few cents to two dollars maximum
in order to be compatible with mobile phone pricing. One example: the use of gyro-
scopes for mobile phone camera stabilization will be only a solution for a three Mpixel
sensor. Below this size of image sensor, a software solution will be sufficient.
Fortunately, compared to the automotive industry, MEMS manufacturers have
the ability to decrease the specifications of devices (in terms of reliability, lifetime,
and specifications) in order to reach price targets. The price target for MEMS devices
in mobile phones is clearly an issue:
These price targets are very aggressive, and cost effectively manufacturing such
devices will be a challenge. The next months and years will determine if MEMS will
be key devices in mobile phones.
Offering devices at a higher price is possible, but only if the functions of the
new device are enabling the service providers (the wireless communication service
providers) to sell new services to recover that cost, as was the case with the image
sensor. This is one of the biggest challenges for MEMS in mobile phones. Device
manufacturers considering these applications are talking with service providers in
order to understand the potential service to support such as using the sensing
capability of MEMS, extended battery life, etc.
Components
System Manufacturers
Manufacturers
Design Companies
companies have been very active over the last three years. Akustica, Dis-
cera, Knowles, and Lightconnect are key examples of such business activi-
ties. The relationship between fabless and contract manufacturers is still
very complex because the management of intellectual property is always a
challenge. The model can lead to months of discussion on who owns what
part of the process, flow, and design. This is currently a key problem for
this MEMS market.
Contract manufacturers: these companies are developing specific pro-
cesses for their customers and then using the developed processes to deliver
devices to the customer. Such agreements are generally made with exclu-
sive rights or at least lead time because the customer of the contract manu-
facturer has financed the process development, paying the NRE cost.
Foundries: MEMS foundries use their available processes to manufacture
MEMS devices for external customers. The design of the customer gen-
erally must be retargeted to the foundry processes in order to take into
account the characteristics of the available process.
Apart from the development of MEMS markets, the industry has entered a new
phase with the recent industry consolidation in the past ten months. In 2002 and
2003, several MEMS companies disappeared due to a lack of business or difficul-
ties with launching real products. The remaining companies (almost 350 MEMS
manufacturers worldwide) are healthier, seeing a strong growth in their revenue and
perhaps becoming profitable like HL Planar, Tronics Microsystems, and Silex. The
important movement that started mid-2004 is industry consolidation Colibrys
(Switzerland) acquired Applied MEMS (U.S.A.), Schneider Electric (F) acquired
Kavlico (U.S.A.), MSI (U.S.A.) acquired more than six companies in 2004, and
Qualcomm (U.S.A.) acquired Iridigm Displays (U.S.A.).
A few companies like Honeywell, GE, MSI, Schneider Electric, and Meggit Elec-
tronic have clearly announced their intention of important external acquisitions in
order to gain access to key technologies and markets and find growth opportunities
in MEMS-related businesses. We will certainly see a continuation of this trend in
2007 and beyond.
Another key driver in the industry is the opening of vital industrial companies
to external customers such as Honeywell, Bosch, Sony, Olympus, and Omron, which
are now opening their manufacturing facilities for external customers. For example,
two years ago, in order to attract more business, Bosch created an external customers
business unit, able to develop and sell devices for automotive system manufacturers
(sometimes competing with Bosch) and more generally for industrial partners.
New players are also appearing. Thailand now has a public company manufac-
turing MEMS devices (MEMStech, the former EG&G Heimann MEMS activities);
there are more than ten MEMS manufacturers in Taiwan, working as a foundry,
manufacturing ink-jet heads, pressure sensors, and silicon microphones.
Japanese companies have also restarted the investment in MEMS. Yole Dvel-
oppement has identified more than 90 companies developing and manufacturing
MEMS devices. This year ten of them are launching new 3D accelerometers for
consumer applications. The Japanese MEMS industry is characterized by a very
strong presence of fab integrated in system manufacturers such as Olympus, Canon,
or Fujikura, or device manufacturers (like MEW and Oki). On the other hand, there
are few design houses; this function in the industrial food chain is mainly realized
by R&D organizations and universities.
very low-end applications. In addition, the IC timing market is worth $2 billion and
involves different companies, like Texas Instruments and Cypress.
For system designers, the company is selling MEMS oscillators, which are
replacing quartz devices. This business is supported by a distribution net-
work like Future Electronics in Europe. SiTime now has distributors in
every industrialized country. The target here is to compete directly with
quartz devices.
For IC manufacturers, SiTime is selling the resonator only, so the IC cus-
tomer is able to develop its own PPL/ASIC in order to integrate the resona-
tor and the MEMS resonator in its application, taking full benefit of the
small size of the resonator. The market target here is system-in-package
(SIP) and also multi-chip module solutions.
For quartz manufacturers, SiTime is proposing specific projects in order to
develop specific resonators, assemble the MEMS resonator with the exist-
ing products of the quartz manufacturers. Here is the area of custom proj-
ects, with direct work with quartz manufacturers
So SiTime is able to work with any kind of customer, including standard quartz
customers and IC timing and quartz manufacturers, which were initially competi-
tors. Therefore, the business models of the company are very smart.
SiTime has already signed two agreements: one with Ecliptek (U.S.) and the
other one with Micro Crystal (CH), the quartz crystal manufacturer of the Swatch
Group. Ecliptek has already announced several products, included in the EMOtm
family. The pricing in volume is announced at $0.7 per device. The main feature
of the device proposed by Ecliptek is the QFN package of the device, using plastic
injection molded packaging, allowing ultra-miniature footprint and low cost (see
Figure6.5).
For this agreement, according to our analysis, SiTime is selling to Ecliptek a
MEMS oscillator so that Ecliptek can build on top of it its own product. The agree-
ment between Micro Crystal was made in the first half of 2006. The details of the
agreement have not been disclosed, but we can imagine that SiTime will also deliver
the resonator to Micro Crystal. SiTime already has 5.5 million units that are ready to
be shipped, and they expect to sell more than 1 million units before the end of 2007.
Standard QFN
Programmable PLL and Lead Frame
Compensation Die
SiRes MEMS
Resonator
linked IC, but the company has also developed the process used to manufacture the
Programmable PLL and compensation circuit.
The resonator was developed with the understanding made at Bosch, with a col-
laboration from Stanford University and also the support of SVTC, and 8-inch 65
nanometer private facility.
This work was transferred to Jazz Semiconductor, where the technology is in
high volume production, and the ASIC is manufactured by TSMC, both on an eight-
inch line.
SiTime has introduced in October 2006 a first product of its type, the SiTO1OO,
a MEMS resonator that is the smallest in the world. This new device is shipped in the
die format and provides a square wave signal in the megahertz range. It could be flip
chipped on a substrate or another device or wire bonded on an MCM. The device is
so small that 25 8-inch wafers are enough to produce 1,000,000 devices.
The first applications targeted by SiTime are notebooks, cell phones, and DSC.
The automotive market will be serviced by the end of 2008. The MEMS resonator
technology does not allow the company to target high-end quartz at this time, but
this will come later.
The text on this page has been updated from the original by Mr. Joe Brown the Co-founder of
SiTime.)
Process development:
The last two processes have and will have an important impact on price reduc-
tion for pressure and inertial sensors.
In parallel with the history of the R&D and product introduction schedule at
Bosch, we can define several steps in the Bosch involvement in MEMS fields:
The organization of the Bosch group is quite complex. The MEMS activities are
shared among different organizations within the group:
Corporate R&D is involved in new concepts and new sensor development. All
the sensor activities are coordinated with the group in order to reuse products
and development and maintain the leadership of Bosch in sensor markets.
Table6.2
Evolution of Sensor Size (Source Bosch)
First Generation Second Generation Third Generation
R&D activities are located in the Stuttgart and Reutlingen (Germany) area,
but Bosch also has a Research and Technology Center in Palo Alto (Cali-
fornia, U.S., founded in 1999). Bosch is also a long-term industry member
of BSAC (Berkeley Sensor and Actuator Center).
MEMS design, development, and manufacturing is embedded in the Auto-
motive Electronics Division of the Automotive Technology business section
and is in charge of the development and manufacturing of MEMS devices
for the group. Manufacturing activities are based in Reutlingen, Germany,
for the front end. Back-end manufacturing is carried out in several Bosch
plants (Germany, Spain, etc.) but also uses external subcontractors (organi-
zations like Amkor, ASE, etc.).
Bosch subsidiary Bosch Sensortec is dedicated to the nonautomotive busi-
ness (mainly for consumer applications) and is working as a fabless orga-
nization, developing MEMS devices that are manufactured in the Bosch
manufacturing facility in Reutlingen.
Bosch is also involved with other MEMS companies. It is a key investor in
SiTime (linked to a technology transfer).
Pressure sensors:
Manifold air pressure
Barometric air pressure (engine management and airbag)
Engine monitoring (high pressure)
Fuel tank pressure
Diesel particle filter pressure sensor
Side airbag pressure sensor
Chemical sensors:
Figure6.7 (See.color.insert.following.page.16.).Airbag.module.(Bosch.source).
Figure6.8 (See.color.insert.following.page.16.).Gyro.sensor.(Bosch.source).
Figure6.9 shows the evolution of Boschs sensor size. The number of units pro-
duced is increasing every year, but, in parallel, Bosch is decreasing the size of the
device. Table6.2 indicates decrease of die size from generation to generation.
The decrease in dimension is a result of significant price pressure. There is no
Moores law in the MEMS field, but there is clearly a year-to-year size reduction due to
customer price pressure. Several methodologies are used in order to decrease price:
730 m
813 m
668 m
Table6.3
Evolution of Sensor Manufacturing and Sales
1999 2000 2001 2002 2003 2004 2005
For example, the manifold air pressure (MAP) sensor price has declined by more
than 60% between 1994, the first design, and 2004. The major price decrease can be
attributed to the evolution of the packaging: Bosch was using metal can packaging at
the beginning and then moved to hybrid substrate and finally, for the last generation,
to premold packages.
With the gyroscope, Bosch started with a ring comb drive structure, but the new
generation uses a new coupled rectangular structure in order to obtain a better signal.
From the first macro mechanical design in 1995 to the last surface micromachin-
ing device in 2005, the price has decreased by more than 70%.
Table6.3 provides a YOLE evaluation of the MEMS business at Bosch. The
leveraged effect of Bosch MEMS activity on Bosch business is very important; the
electronic sales generated by the MEMS devices are multiplying MEMS sales by a
minimum factor of four. So the MEMS business has always been considered a stra-
tegic field at Bosch.
Key growth applications for Bosch are ESP and engine management systems
(especially diesel injection). Overall business is growing, but these two applications
are by far the fastest growing ones.
It is important to note that Bosch has changed its business model from that of
internal fab for a system manufacturer to that of a sensor supplier for the automo-
tive equipment manufacturers (a change made in 1997) and to the model of sensor
manufacturer for consumer applications (a change made in 2005). We analyze these
changes in more detail later in this chapter.
We estimate at YOLE that in 2005 sales of Bosch devices outside the Bosch
group accounted for approximately 17 to 20% of overall business. The nonautomo-
tive business was just starting in 2005 and will be more significant in 2006 and in
the coming years.
The list of Bosch customers outside the Bosch group is clearly confidential, and no
official data are available on the companies that are using Bosch as a sensor supplier.
The applications where Bosch does external business are related to navigation
systems (supplying gyroscopes), airbag systems (acceleration sensors, gyroscopes
and pressure sensors), and engine control sensors (pressure sensors).
These fields are also areas where Bosch is competing at the system level with its
customers from the device level. This situation is accepted by the customers because
of the performance, price, quality of Bosch products, and the fact that they value
Bosch as a stable and reliable supplier. Competition with Bosch at equipment level
could be an issue for several customers.
Another important evolution in Bosch MEMS activity is the development of the
cluster concept. Car manufacturers are increasingly interested in having a few sen-
sor clusters that diffuse the information to the different pieces of equipment inside
the car. Bosch has developed several sensor clusters, mainly for chassis control.
Such clusters (like the MM3) integrate a gyroscope, acceleration sensors (used
as premold sub modules), full digital processing, CAN interface, and more. The
price impact of clusters is significant by enabling less wiring, centralized electronics,
and sensing. Also, the signal can be reused by other equipment within the car.
6 manufacturing line
4000 m of CMOS fab, where the MEMS front-end manufacturing is done
3000 m of MEMS back-end fab, where specific MEMS processes are used
and a 1200 m of clean room expansion just opened in 2006
45,000 wafer starts per month
100 million MEMS units produced in 2005
Test center and assembly line for packaged MEMS products
300 employees in MEMS production
250 employees in MEMS R&D
In addition to the Reutlingen fab, Bosch has a back-end facility in Madrid (mainly
for accelerometers). But all silicon parts are manufactured in Reutlingen. Bosch only
uses silicon wafers (no SOI production as far as we know).
The manufacturing line is today a six-inch line. Bosch has announced it is invest-
ing in a new eight-inch line, both for IC and the MEMS manufacturing. The new fab
will be operational in 2008 and will require an investment of 550 million euro. This
investment is linked to semiconductor manufacturing, but it will heavily impact the
MEMS business at Bosch. The unit production capacity will be multiplied by 2.5,
also enabling cost savings in manufacturing (due to the effect on batch processing)
and preparing Bosch in the development of consumer markets. As far as we know,
the six-inch line will stay in Reutlingen.
a. System manufacturers: Conti Teves is the main competitor for ESP; Del-
phi, TRW, and Siemens VDO are all competing in one way or the other
with Bosch. Several of these companies have internal MEMS fabs (like
Delphi), and the others use sensor suppliers, including Bosch, to obtain
MEMS devices.
b. Automotive sensor manufacturers: VTI Technologies, Analog Devices,
etc., for acceleration sensors; Systron Donner, Panasonic, Infineon/Sensonor,
etc., for gyroscopes; and GE Novasensor, Freescale, etc., for pressure sen-
sors are all competing with Bosch at the device level.
c. Consumer sensor applications: MEW, Kionix, Analog Devices, etc., are
also the main competitors for the consumer markets. Until now, Bosch Sen-
sortec was only visible in the acceleration sensor market (with 2 axis and 3
axis sensors).
The Bosch group is the world leader in automotive electronics, and the MEMS
group at Bosch is by far the world leader in sensor manufacturing, with the broad-
est product range. The closest competitor is 35% smaller in size and has a limited
growth rate.
$600
$500
$400
US$
$300
$200
$100
$0
2003 2004 2005 2006 2007 2008 2009 2010
Strong growth of at least 35% between 2005 and 2008, due to new production of
key growth applications linked to mobile phones and consumer applications.
Growth after 2009 will drop back to 15 to 20% per year.
In addition to the introduction of new products, we will see over the next few
years that todays system manufacturers who have integrated manufacturing facilities
will increasingly subcontract manufacturing to MEMS foundries/contract manufac-
turers. HP and Lexmark are clear examples of system manufacturers with internal
facilities that also use external foundries in order to have access to extra capacity
with strategic partners. Several other major companies with internal MEMS manu-
facturing are following the same model.
Those different fields are strong industry in Japan. The market size estimated
by MMC is larger than the estimation done by YOLE Dveloppement. It is mainly a
matter of definition. The YOLE Dveloppement figures only include MEMS silicon
and quartz devices (we are reviewing the metal and polymer parts in different ways)
compared to the MMC estimation, which includes all type of microdevices.
According the MMC, the next fields where the growth will be important are bio-
technology, medical/social services, and society and culture. Those fields represent
attractive markets expected to be high growth markets in response to future changes
in society.
MMC estimated that the market volume will be 1.36 trillion yen in 2010, or
roughly 9 billion euro. According to their analysis, the large volume sectors (in the
range of 200400 billion yen) will be information and communications equipment,
automotive applications, and culture (including sports). The MEMS market in these
areas will expand and grow steadily. Development of low-cost MEMS sensors and
RF MEMS enables significant growth in the society and culture sector because
MEMS devices will be adopted in large numbers both in information-enabled home
appliances and amusement products. The new game console WII from Nintendo is
a good example of this trend.
New markets for MEMS (in the 100 billion yen range) are new energy/energy
saving, medical and social services, biotechnology, and aerospace. For realizing
those applications, both new functions, enhanced precision and reliability will be
Aerospace
1,200
Automotive
1,000 ($10B) Environment
Billion Yen
Energy
800
Biotechnology
Measurement equipment
200
Precision equipment
required. The key to the development of these markets will be the development of
MEMS technologies based on new materials and new structures.
Figure6.13 shows the Japanese MEMS market trends according to MMC. Fig-
ure6.14 presents the analysis of the evolution of the MEMS applications in Japan,
according to MMC.
The MEMS technologies and markets have been established in Japan as an
industrial market since the mid-80s with the availability of silicon pressure sensors
for medical, industrial, and automotive applications.
Several Japanese companies have been involved in the MEMS fields since
almost the beginning Matsushita Electric Works (pressure sensors in the mid-
90s), Denso (pressure and acceleration sensors), and Mitshibishi Electric (pressure
sensors), just to mention a few.
Today MEMS activities in Japan are very strong: Yole Dveloppement has iden-
tified more than 70 Japanese companies involved in MEMS development and manu-
facturing, with their own clean rooms and production facilities.
The Japanese MEMS industry is characterized by a very strong presence of fab
integrated in a system manufacturer (like Olympus, Canon, or Fujikura) or device
manufacturers (like MEW, Oki, etc.). On the other hand, there are very few design
houses and fabless companies: this function in the industrial food chain is mainly
realized by R&D organizations and universities. The foundries have been established
for 2 years in a network of ten industrial and R&D organizations, under the manage-
ment of the MicroMachine Centre. These different companies are proposing sev-
eral services, from full development and production to CAD tools and engineering
services. This initiative (including Oki Electric, Omron, Olympus Optical, Hitachi,
Fujikura, Matsushita Electric Works, Fuji Research Institute Corp., Nano Device
and System Research Institute, ULVAC, and Nihon Unisys Excelutions) is important
in order to bridge the gap of MEMS development and manufacturing for companies
having specific needs and no ability to make their own development. What is miss-
ing at the moment in Japan is mainly contact manufacturers, i.e., companies able to
develop specific process and manufacture devices on this process. It will certainly
happen in the next two to three years.
Another very important point is the presence in Japan of capital equipment and
material manufacturers, with strong involvement in MEMS. Some of the leading
ones include the following:
New innovative devices: Sony (micro mirror arrays), Olympus (AFM tips),
Nippon Signal (bare code reader), etc.
The Japanese companies are less involved in new areas like RF MEMS, tire
pressure monitoring, silicon microphones, IR image sensors, etc., but the industrial
involvement in key devices for consumer applications is very impressive with the
growing position of Oki, Hitachi Metals, and MEW.
Several Japanese companies, such as Silicon Sensing Systems for gyroscopes
and Epson and Canon for ink-jet heads, are world leaders in their activities. In the top
30 world MEMS manufacturers, 7 companies are involved in the ranking. Foreign
companies like Freescale (former Motorola Semiconductor) also have manufactur-
ing facilities in Japan. Tohoku Semiconductor, for example, is manufacturing the
entire silicon acceleration sensor for Freescale and is on the way to industrializing a
new product based on SOI.
All the ingredients are present in Japan in order to make available the key MEMS
devices for system manufacturers. This R&D and industrial infrastructure is used
and will be key for the development of innovative modules and systems. The evalua-
tion of the MMC is just showing the healthy MEMS activities in Japan.
900
R&D equipment
Test
800 Assembly & Packaging
Other front-end
700 Wafer cleaning
Inspection & Meas.
600 Thermal processing
Market in $M
Bonding
500 Deep etching
Etching
400 Lithography
Deposition
300
200
100
0
2005 2006 2007 2008 2009 2010
Deep reactive ion etching was developed more than 14 years ago. The process
was invented at Bosch in 1992 by F. Laermer. The first company that bought the
process license from Bosch was STS in 1994. The first equipment release occurred
in 1995 with the introduction of the Anisotopic Silicon Etching (ASE) process.
DRIE is an anisotropic (directional) process, replacing the wet chemical pro-
cess and enabling etching independent of crystal orientation structure, vertical
etched structures and high aspect ratio structures. Figure6.16 presents a comparison
between wet etching and DRIE. Figure6.17 shows a typical device made with DRIE
equipment. According to YOLE Dveloppement analysis, the installed base of DRIE
equipment worldwide was about 700 at the end of 2006.
Inertial Sensors
estimate that more than 60% are silicon or quartz surface micromachined. The users
of such equipment include Bosch and Panasonic.
There are two competing DRIE process technologies: the Bosch process and the
cryo process. A summary of both processes can be seen in Table 6.4. Although the
cryo process has slightly better selectivity, it requires lower temperature baking. The
Bosch process is the most widely used worldwide, and Bosch has licensed its pro-
cess to the major equipment manufacturers. Figure6.19 presents the evolution of the
DRIE process at STS in MEMS manufacturing, with a visible evolution of the etch
rate. The cryo process is well suited to large wafer sizes: this process helps provide
better uniformity. The challenge here is to have temperature uniformity on the wafer
>85% Si -Phones
>70% Accelerometers
% of DRIE Use
~50% Gyroscopes
Advanced
Packaging
RF-MEMS
<20%
Table6.4
Comparison between Bosch and Cryo Processes
Bosch Cryo
Etch process in small steps, followed by a Substrate cooled down 100C to 150C.
cleaning step. Formation of SiOxFy on the sidewall, preventing
During etching, a polymer is formed on the sideways etching.
sidewalls.
Improved ASEHRM*
18.7 m/min
surface. As to the companies involved in the DRIE market, the Japanese and the rest
of the world market are quite different.
Outside the Japanese markets, the key players are STS, Alcatel MMS, Lam
Research, Oxford Instruments, Aviza Technologies, and Oerlikon Balzers (formerly
Unaxis). STS was the first company to license the Bosch process in 1994 and has devel-
oped four different generations of equipment since that time (see Figure6.20). STS has
also announced the development of a new 300 mm platform for the pure semiconduc-
tor business. Figure6.21 presents the evolution of the Alcatel equipment family.
In the Japanese market, the companies involved are Sumitomo Precision Prod-
ucts (SPP, mother company of STS), Samco, Tokyo Electron, Shinko Seiki, Pan-
asonic, and Ulvac. Non-Japanese companies involved in the Japanese market are
mainly Alcatel MMS, working with Canon.
The total worldwide market for DRIE for MEMS manufacturing and develop-
ment includes around 30 pieces of equipment in 2005 and will jump to more than
50 units in 2010. The world leader is STS, followed by Alcatel MMS. According to
YOLE Dveloppement analysis, in 2005 these two companies together had world-
wide more than a 75% market share. In addition to MEMS sales, DRIE has been
increasingly adopted by semiconductor companies for applications in advanced
packaging, power devices etc., which are building more sales for MEMS-related use
of DRIE equipment.
Industrial
Validation: ASE HRM Improvements
Microspect
Project
ASE-HRM
Performance
SOI Etch
Parameter Ramping
ASE-HR System
SOI etch
Increased Passivation 2 Step Approach
ASE Process
ASE-SR System
Bosch
Licence
94 95 96 97 98 99 00 01 02 03 04 05 Year
ASE-SR ASE-HR ASE-HRM Pegasus
1st Generation 2nd Generation 3rd Generation 4th Generation
2006
I-Productivity project
AMS 200 I-PRODUCTIVITY
The growth of the DRIE business can be analyzed in the following way:
In parallel to business growth, the process has also been further developed, with
a very significant increase in the etch rate. Figure6.22 presents the evolution of the
etch speed (in proportion to the open area) with Alcatel MMS equipment.
Figure6.23 provides a look at the evolution of the sales of DRIE equipment
since 1994, based on YOLE Dveloppement estimates. YOLEs model in detail can
be used and adapted for new processes in the MEMS industry, like wafer bonding
and double-side mask aligners as well as for new processes under development like
supercritical gas cleaning and xenon difluoride etching. This model was built by
YOLE Dveloppement, and we are using it in our strategic and market analysis for
equipment manufacturers.
Sales in 2000 and 2001 were very high due to the optical MEMS bubble (which
was linked to the optical telecommunication bubble). In 2002, 2003, and 2004, the
equipment market was adversely affected by the supply of secondhand equipment,
60
50
2007
Etch Rate (um/min)
40
30
2006
20
10
2002
0
100 80 60 40 20 0
Open Area (%)
Figure6.22 Etch rate function of open area in 2002, 2006, and 2007 (source: Alcatel).
160
140
R&D and production
equipment for non
Nb of Equipment Sold
120
MEMS applications
100
Production equipment for
80 MEMS
96
98
00
02
04
19
19
19
20
20
20
which according to our analysis accounted for more than 30% of the total market (in
addition to the data mentioned in Figure6.23). Since 2005, this secondhand market
business has stood at below 20% of the annual market.
Several trends are influencing this market. The production of MEMS is moving
into high volume. Thus, different suppliers must provide robust high-volume manu-
facturing equipment. STS, SPP, Alcatel, Lam Research, etc., are now proposing such
equipment, which consists mainly of a cluster tool with several chambers. Up to
2005, the equipment was mono-chamber.
The second trend is that new markets are reusing the DRIE process: companies
involved in power devices (for deep trench etching for integrated power modules),
3D stacking of IC devices (for via etching for memory stacking, for example), and
advanced packaging are all at the moment testing DRIE as a key new process for
future development. These applications are being tested by the existing suppliers, but
they will need full production equipment that implements SEMI standards that are
still under development.
As a consequence of these two trends, equipment manufacturers with strong
involvement in etching business and those who come from the mainstream semi-
conductor fields (like Lam Research, Tokyo Electron, and Applied Materials) are all
either developing or proposing such equipment, targeting the volume markets. This
trend is reinforced by the interest of semiconductor companies in MEMS. All the top
50 semiconductor companies worldwide (including Intel, Samsung, Freescale, Infi-
neon, STMicroelectronics, and Renesas) are either manufacturing MEMS devices or
developing such processes. They all need DRIE equipment, and they are generally
working with large equipment manufacturers. The added value of the companies
involved in this field for years is the engineering capability and the long experience
in process development and adaptation to specific needs. The MEMS law (for each
device you need a specific manufacturing process, different from device to device)
has been a key enabler of the engineering capabilities of such companies as STS,
SPP, and Alcatel.
New product offerings are appearing from semiconductor equipment ven-
dors with a strong background in volume production (like Lam Research). System
Nanotechnologies
Nanomaterials
Nanoobjects &
Nanocomposites
Nanotubes
Nanoparticles
reliability, process repeatability, process performance across the wafer, and strong
customer support are the key focuses for the semiconductor equipment compa-
nies and are as important as the increase of etch rate in order to increase the yield
and maximize the wafer output. With a different price structure, the semiconduc-
tor equipment manufacturers are proposing equipment that includes all the lessons
learned from the semiconductor industry.
These trends may change radically the way the market is established today. The
market growth is significant, and the reuse of MEMS processes for other devices
will certainly change the way the industry is organized.
Carbon nanotubes: these more recent products discovered in 1991 will have
an important commercial potential based on the very specific properties
they bring, such as high mechanical strength and high conductivity.
Slurries, Cream
Integrators
Final Users:
Liquid Matrix
Automotive,
Nano-objects Aeronautics,
Manufacturers Bulk Plastics
Solid Polymer Construction,
Matrix =
Nanocomposites Consumer
Coatings Goods...
Resin Polymers
Manufacturers Manufacturers
Additives
Peripheric Players Manufacturers
Liquid matrix: sunscreen, slurries for wafer polishing, medical dyes, etc.
Bulk plastics or composites: automotive plastic parts, tennis balls and rack-
ets, cables, beverage packaging, etc.
Organic coatings: automotive body coats, wood flooring, outdoor wood
coatings, etc.
Figure6.27 presents the different functions that are available for the three types
of nano materials: scratch resistance, reinforcement, and barrier coatings.
CNT
Other Inorganic
Nanoparticles
Colloidal Silica
Nanoclay
Market Polishing
Penetration Ex: CMP
Self Cleaning
Ex : Architectural Coating Fire Retardant
R&D Ex: Cables & Wires Field Emission
Refractive Index Ex: Display
Ex : Display
Today volume applications are linked to the CMP business. Apart from this appli-
cation, a lot of niche markets are now using nanomaterials, like the reinforcement of
sports goods and antimicrobial protection for HVAC, but each of these niche appli-
cations is using only kilogram of materials every year.
Figure6.28 presents the evaluation of the nanomaterials markets. We at YOLE
Dveloppement estimate that the nanomaterials markets reached $1.1 billion in 2006,
mainly linked to CMP applications, and we expect a market of $2.6 billion in 2010.
An overall 23% growth rate per year is expected, with market segment (like carbon
nanotube) growing by more than 60% per year. The business opportunities linked to
nanomaterials are clearly very important and could change the way of working for
various industries.
2500
Forecasted Annual Sales (M$)
SWCNT
CNT
2000
MWCNT
500
0
2005 2006 2007 2008 2009 2010
Years
CAGR of 23% is expected for both materials. CNT is the most
growing nano-object with 60% growth in volume expected.
Nanoparticles are forecast to exhibit a growth of 24%.
on the market (Bayer, Arkema, and Rhodia, for example), which is also a sign that
this sector is becoming really attractive.
Integrators (i.e., polymer and coating manufacturers) are arriving more and more
in the field with nanocomposites offers (PPG, Honeywell, PolyOne, Basell, Becker
Acroma, etc.). It is expected that those integrators will be increasingly involved in
nanomaterials as the nano objects integration is becoming simpler than in the past.
Finally, final users in automotive, construction, sports, and textiles realize the
potential differentiation that could be brought by nanomaterials to their final prod-
ucts. As already explained, world market demand for nanoparticles and carbon
nanotubes is estimated to be higher than $1 billion in 2006. Nanomaterials diffusion
was up to now limited to high-value niche markets: a lot of new applications will
emerge and be developed in the coming years thanks to the price reduction of the
nano objects. It is therefore expected that the nanomaterial market will grow about
30% each year.
Long-Term Vision
What could happen in the MEMS industry? What are the key business trends? We at
YOLE Dveloppement believe that the market will move in the following ways:
2005 markets:
The market is very fragmented, and its value has reached $5.1 billion. More
than 400 companies are developing or producing MEMS devices.
Few products have reached high volume: accelerometers, gyroscopes, opti-
cal MEMS, pressure sensors.
New products have been introduced, like RF switches and silicon micro-
phones, which are starting to impact the market.
The top 30 MEMS manufacturers are together producing more than 70%
of the MEMS devices.
The production infrastructure is in place, and all the new companies are fabless
organizations, using the existing MEMS foundries or the ASIC foundries.
The main evolutions we are forecasting for the next ten years are the following:
2010 markets:
2015 markets:
These long-term trends are open for discussion, but the key signs of the evolution
of the MEMS markets are here. The future will certainly show strong evolution of
the MEMS markets, both in the industry infrastructure and also in the development
of the MEMS markets and applications.
Reference
1. All market evaluation from Yole Dveloppement is based on the first level packaged
sensor. For example, for the evaluation of the ink-jet head business, we are including
only the packaged head, instead of counting the complete cartridge (including housing
and ink). It clearly decreases the total volume of the market but provides a more realistic
vision of the component-based systems. Figure6.1 includes only silicon-based devices.
An important part of the MEMS markets is related to polymers. Key European players
like Microparts in Germany are involved in the development and manufacturing of
polymer microdevices. This part of the MEMS market is not analyzed in this chapter.
Kevin Matthews
Contents
Building the Company from a University Spin-Out and Developing a Market..... 143
Origins Pre1999.................................................................................................... 145
Spinning Out In the Wrong Direction 19992000....................................... 145
A Change at the Helm (20002001)....................................................................... 148
Raising VC Money 20012002............................................................................... 151
Go to Market 2002-2005........................................................................................ 153
Business Model............................................................................................ 153
Partnerships and Intellectual Property........................................................ 154
Envirox Fuel Borne Catalyst for Greater Fuel Efficiency....................................... 155
Optisol Photostable UV Absorber...................................................................... 157
Corporate Development 20022004....................................................................... 159
Floating On Aim..................................................................................................... 160
Pipeline Development............................................................................................. 161
Nanoplex Technology............................................................................................. 161
Other Pipeline Technology..................................................................................... 163
Solacor UV protection for plastics and coatings..................................... 163
Security Markers......................................................................................... 163
The Total Pipeline................................................................................................... 163
The Nanotechnology Debate.................................................................................. 164
The Future............................................................................................................... 165
A Personal Perspective........................................................................................... 165
143
Origins Pre1999
The company originated in the University of Oxfords Engineering School or, more
specifically, the Department of Materials Science. The academic founders were Pro-
fessor Peter Dobson, who was Professor of Engineering, and Dr. Gareth Wakefield,
a Post-Doctoral Research Fellow working with Dobson. Professor Dobsons back-
ground had included industrial research at Phillips, and in the 1990s this had evolved
into a specific interest in nanomaterials, including phosphors, metal oxides, quantum
dots, and the optical properties of such materials. Gareth Wakefields Ph.D. was in
electron microscopy, and this interest developed into the preparation of nanomateri-
als, driven by the need to secure good samples to study under the microscope.
Nanomaterials are advanced materials that are engineered at the nanoscale (i.e.,
less than 100 nanometers (nm) that have size-specific chemical or physical proper-
ties). For instance, as particles are decreased in size, the surface area to volume ratio
increases dramatically, with a commensurate increase in chemical or catalytic activ-
ity. Nanomaterials are typically fabricated by reacting molecules together in a care-
fully controlled process to yield the particular size and composition required. There
is a popular perception that nanoscience is about making things smaller; in fact, most
of the chemicals we use in our daily lives (e.g., detergents, drugs, and cosmetics) are
single molecules with a size of around 12 nm. Nanoscience is about assembling
these single molecules to give a new material form. I liken this to childrens con-
struction toys; the individual pieces are the building blocks (molecules), and when
children tip them out of a box, they form a natural random mound of pieces. How-
ever, with careful assembly, these can be converted into cars, cranes, houses it is
the equivalent careful construction of molecules that results in advanced functional
or even multifunctional nanomaterials.
Together Peter Dobson and Gareth Wakefield formed the creative force that
developed the ideas and technology that Isis Innovation subsequently patented and
elected to commercialize through the formation of a spin-out company. At Oxford,
the university owns the technology developed by its academics and researchers, and
Isis Innovation, Ltd. is the technology transfer arm of the university specifically
charged with commercializing this intellectual property. In 1998, Dr. Wakefield was
asked if he would found and join the fledgling organization and rapidly became
immersed in filing patents and dealing with the administrative challenges of setting
up a company. A marketing study was completed, and the business plan was set with
the main focus on nanoparticle phosphors that could be used for low voltage field
emission displays. The company was established in 1998 and was spun out from the
university on August 15, 1999, as Nanox Limited.
The original employees of Nanox were a mix of experience and young blood. Dr.
Wakefield joined the company to lead the research. The ex-head of R&D of a large
corporate was hired as part-time CEO and Chairman. In addition, Oxonica hired a
business development director, process manager, and administrator. Nanox funded
a post-doctoral worker at the University of Oxford to continue to develop field emis-
sion display technology. The new company had five employees.
The board consisted of the two founding investors, with Charles Eld acting as
finance director, a representative from Isis, the two academic founders, CEO and
business development director. This appears to be a fairly typical board composition
of an early stage spin-out, which also tends to be very operationally focused. In the
early days, this focus on operations is paramount in ensuring that the basic tasks of
setting up and running a business are managed.
Nanox was founded with an exclusive licence to two areas of intellectual prop-
erty: nanoparticle phosphors and doped metal oxides for improved UV absorbers.
The small spin-out team focused on the development and marketing of the phosphor
technology for field emission displays to allow the use of lower voltages. The key
challenges facing the team were:
These themes became the common challenges for all the subsequent projects
undertaken by Nanox/Oxonica, with the only difference being the application.
After about 12 months, commercial realities became clear. The phosphor market
was largely controlled in the Far East, and the displays market had too many compet-
ing technologies. Field emission display had significant technical challenges and was
not the leading technology. Indeed, no companys field emission systems are being
marketed at present.
The board reviewed its options and concluded that there was a need to diversify
the product potentials and initiated a period of research activity to achieve this.
It is worth highlighting the key contribution that Charles Eld made at this time.
Eld is one of the original angel investors and characterizes many of the key attributes
that an angel can bring to the table to help an early-stage company develop. He is a
pragmatic, hands-on investor I am sure a proportion of the executives reading this
will groan at the statement. Another interfering busybody investor who rings me up
everyday to check on progress? Wrong! Eld was acting finance director, and when
Mott resigned, he stepped into the role of chairman. He actively engaged and pushed
forward the preparation of a draft business plan and initiated a number of investor
meetings to take place on my arrival. On the day I joined, Eld made it clear to me
that I was the CEO and that he would not interfere and undermine my authority but
would be available if I needed advice and would help whenever requested. He then
handed over the reins of Oxonica. He stuck by this philosophy, even when times
were difficult. In addition, he backed the business with cash, which helped to build
confidence with other investors when it was hard to secure funding in early 2001 and
allowed us to raise 480k in the summer of 2001.
From my own experience, I conclude that early-stage technology companies
have specific challenges:
Finding suitable investors with balls who will back the management
and the vision even when ultimate success looks difficult. There are few
companies that drive forward at the edge of technology innovation that do
not have setbacks or delays. Therefore, it is important for early-stage com-
panies to find investors who recognize the risks and are investing in the
fundamentals. The focus can migrate to the business plan, revenues, profits,
etc., as the business development stage matures.
Persuading individuals who have relevant business experience to join the
board and the management team. This issue often comes down to the cred-
ibility of the start-up will it survive? The fact is that many of the most
desirable individuals for such a company are in secure, well-paid roles with
major multinationals. Luring them into a high-risk venture with no market
presence, little support infrastructure, and a questionable cash position is
nontrivial but critical to success.
My immediate focus was to define what Oxonica was trying to be. This trans-
lated into an intense activity on the strategic plan to define the mission and target
markets. This resulted in a business plan underpinned by a clear portfolio rationale
that was focused on risk, reward, and resource. The business was early stage and had
a number of opportunities it could pursue. The pipeline analysis clearly highlighted
the need for the immediate focus to be on shorter time-to-market opportunities,
which would be both attractive to investors and build capability within the company
to commercialize products and become self-sustaining. Hence product develop-
ment was focused on a fuel-saving technology for diesel vehicles and a UV absorber
technology for cosmetics. The opportunity pipeline was maintained with a minimal
investment in clinical diagnostics and externally funded early-stage research in the
areas of solar cells and security labels.
The projects were managed through a gate process that is represented in
Figure7.8. Analysis of the pipeline at the time clearly demonstrated that all the proj-
ects were early stage but with some significant market opportunities. Therefore, the
next challenge was funding. It was clear that to be successful the company needed
to raise a significant amount of money to move from having concepts to introducing
tangible products that could be commercialized. The assessment was that we would
require 4 m. It seemed unlikely that the company could sensibly raise this amount
of money from private individuals in 2001. The cracks in the dotcom boom were
starting to emerge, so we focused on securing enough financing to carry us through
to a venture capital (VC) funding round targeted for the end of 2001. So, from having
eight weeks money when I joined the company in April, we closed a private inves-
tors round that raised 480,000 in July/August. Our burn rate at that time was about
80,000 per month, and we calculated that we would end the year with 40,000 in
the bank.
Product Pipeline
Photovoltaics
For
Solar Cells
Sunscreen
Clinical
Diagnostics
Fuel Emission
Catalyst
Security
Labels
in securing VC money within the organization and appointed First Capital as our
corporate finance advisers.
We prepared the business plan and investor presentation and launched a new
venture capital financing round on September 9, 2001, two days before the tragic
terrorist attacks in the U.S. In response to these events and the uncertainty around
the world about the potential impact of terrorism, the financial markets immediately
turned extremely risk-averse. We realized some funds would withdraw from financ-
ing early-stage technology companies but were not clear which these would be. We
therefore felt compelled to launch a broad approach. About 90 venture capital groups
reviewed our business plan. We drew a broad geographic range of interest in the U.S.
and Europe as well as the U.K. I had face-to-face meetings with some 55 VCs, 36
of which proceeded to follow-on meetings. This was a very demanding period, with
the cash position yet again becoming a concern, up to eight intensive meetings a day,
and the business to run. It reminded me of a trait that a previous mentor had said was
a pre-requisite to be successful in business stamina. It was exhausting! All of this
activity resulted in only a single term sheet: despite all the interest from venture capi-
tal groups, only one had the risk appetite to lead our financing Foresight VCT.
The Foresight term sheet arrived in late November, and it took until February
2002 to agree to the terms and construct a syndicated investment. Our forecast had
been that we would finish 2001 with 40,000 in the bank, and we did. Our burn rate
was still 80,000 a month, but we had already taken steps to generate cash, which
enabled us to continue until June 2002 without further capital-raising. This was not
without some ingenuity. Each month we started without enough cash to finish the
month, but despite that, we never missed a salary run. We got a government R&D
tax credit, did contract work, and took a loan underwritten by the DTI in fact,
anything reasonable and legal to bring in cash. This was a business stage when both
hard work and grim determination were required. The Oxonica board recognized
that the company could only continue to trade if it believed substantive financing
was possible in a realistic timeframe. Without that belief, the company would have
been technically insolvent. The reputations and credibility of all the directors were
at stake, but we kept going and were able to close the venture capital round.
We had been selective over who came into the investment round and had
attracted companies such as the venture arm of the multinational German chemi-
cal giant BASF; two top-performing U.K. VCT funds, Foresight VCT and Trivest
VCT; Northern Venture Managers; Generics Asset Management; and NGen Partners
(aCalifornia based fund) overall a solid group of investors, with capacity to sup-
port the company in further financing rounds.
The fundraising was a difficult time for many people in Oxonica because we kept
changing priorities. If something else could generate immediate cash, we switched
to doing it. Yet we did not lose a single employee of the 12 we then employed through
the whole of that difficult year. We closed the financing in June 2002, and only then
could we really drive things forward. That 2002 VC (venture capital) round brought
in 4.2 million. The company won an award for the deal based on the fact that only
40 similar stage companies had received VC financing in H1 2002 across the whole
of Europe. Looking back, I do not think we would have been so confident at the
board table staring insolvency in the face had we known the odds we were playing
against. The harsh reality is that there were probably other companies with an invest-
ment-worthy business plan that did not survive you are reading Oxonicas story
now partly because we were able to raise money in a difficult financial market.
At the same time as closing the VC round, the board composition was changed to
reflect the new challenges and ownership of the company. Farleigh, Dobson, Wake-
field, the previous CEO, and the business development director all stepped down.
Representatives from Foresight and NGen joined the board, with Charles Eld con-
tinuing as chairman.
Personally, I had achieved the three objectives I had formulated on joining
Oxonica. The strategy was set, the business was funded, and the focus was now
on execution. We subsequently raised two further rounds of venture financing to
support development of the business. The first rights issue at the beginning of 2004
raised another 4 million, the majority of which came from the existing investors.
The second rights issue in Q1 2005 raised 2.6 million.
Go to Market 2002-2005
Business Model
Oxonicas mission statement is to develop innovative commercial solutions for inter-
national markets using the groups expertise in the design and application of nano-
materials. The business model Oxonica has chosen focuses on the groups strength
in identifying market opportunities, securing intellectual property, and introduc-
ing new technology to the market. The groups operational strategy is to introduce
End User
OXONICA
Identify Market Opportunities
Develop Commercial Solutions
Strategic
Partnerships
Outsource
Manufacturers
products to large end user markets to establish the customer value proposition, cre-
ate customer demand, and outsource manufacturing. The group then seeks to form
strategic partnerships with recognized industry leaders to accelerate and maximize
market reach.
The focus on market opportunity has resulted in the application of Oxonicas
broad based technology in a number of different industry sectors. This creates some
unique challenges in terms of managing the complexity of the business. The opera-
tional strategy the business has developed to address this complexity consists of two
main themes.
The lead customer identified was Stagecoach Group plc, a leading U.K.-based
bus operator. Following a successful 12-month trial, Stagecoach agreed in November
2004 to adopt Envirox for use across its entire U.K. bus fleet. The trial conducted
with Stagecoach involved 1500 buses in two regions of the U.K., 12 depots, and 15
bus/engine combinations. The headline results from the trial indicated a fuel savings
of greater than 5%.
Having secured a lead customer for Envirox, the marketing focus switched to
identifying potential channel partners to access the volume market and specifically
the non-depot based passenger vehicle and truck market. In the case of Envirox, the
obvious partners were fuel companies. The issue was how to position the product.
Clearly, when selling to a fleet, the message is simple: save fuel save money. The
oil company sale was more complex: save fuel reduce turnover does not work.
The answer is that the sale of fuel to consumers takes place in a competitive market
with relatively few differentiators: brand national or international, price or per-
formance. Therefore, Oxonica is selling a claim set to the fuel companies supported
by laboratory and field test data allowing them to differentiate their diesel fuel with
Envirox. The fuel company can then either charge a premium for the fuel or increase
market share, or it can do both.
In August 2006, Oxonica announced its first major oil company deal with Petrol
Ofisi A., the Turkish national oil company. This represented the first major use of Envi-
rox in the consumer market and was a significant step for both Envirox and Oxonica.
The size of the global market, estimated by considering Envirox is used in all
diesel fuel consumed in transport and off-road uses, results in an addressable market
of approximately $3 billion.
From a personal perspective, I believe that Envirox also offers a real and tangible
way of reducing carbon dioxide emissions. A great deal of effort is being invested
by many companies globally in trying to find the breakthrough, game-changing,
technical solution to the carbon dioxide emission problem, but in all cases it appears
that these are some ways off. There are many technologies and products sold today
that can give immediate and cost-effective benefits in terms of energy efficiency and
hence emission reductions. More priority and support should be given to these quick
wins to slow down the generation of greenhouse gases. In the case of Envirox, a 5%
fuel saving in the fuel supplied by Petrol Ofisi translates into 200,000 metric tonnes
of carbon dioxide saved annually.
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Time Solar Exposure (hours)
The total materials market for UV absorbers was estimated to be between $250
million and $350 million in 2004.
In tests, when compared with a wide range of commercial sunscreens, a formu-
lation containing Optisol can achieve the highest ratings, with a sustained level of
protection against UV that is stable for more than eight hours. All other products
tested showed significantly inferior performance over the same period. Optisol has
been proven to reduce the production of free radicals, highly reactive chemical spe-
cies produced from exposure to the sun that contribute to long-term skin damage and
premature aging. Optisol has also been shown to be highly effective in stabilizing
other high-cost, photosensitive components in a cosmetic formulation such as vita-
mins C and E and kinetin.
Adopting the same approach as used for Envirox, Oxonica marketed Optisol
to branded cosmetic companies to secure niche access and lead customers. A key
milestone was the decision by Boots, who have a leading U.K. sunscreen brand, to
formulate Optisol initially into a facial product for the 2005 season as part of their
Soltan range. Initial sales to Boots were made in February 2005, and subsequently in
2006, Boots extended the use of Optisol into a once-a-day application product called
Soltan Once. Optisol enables an antiaging claim for the facial product. For Soltan
Once, the claims are high performance UVA protection with a Boots 5-Star UVA
Rating and a photostable (does not breakdown in sunlight) product with performance
maintained for up to six hours for a variety of SPF levels.
In the second half of 2004, the strengthened board focused on negotiating the
simplification of the capital structure with the various parties. In January 2005, this
culminated in the completion of a rights issue, raising 2.6 million. Oxonica had
now created a simplified capital structure with one share class, no preferential rights
for any group, and was therefore ready for a listing on a public market.
Floating On Aim
In the summer of 2004, Oxonica began to consider the feasibility of a public listing.
We met with a number of advisors and decided to appoint Panmure Gordon as our
corporate finance advisor. We changed our accounting firm to KPMG and our cor-
porate lawyers to Hammonds. The fundamental reasoning for these changes was that
as a company we had significant aspirations, and we felt that aligning the company
with high-caliber advisors would support the positioning of Oxonica as a leader in
the nanotechnology field.
Immediately following the rights issue in January 2005, we began to prepare for
going public, working on audit reports, the prospectus, patent attorney reports, and
an independent technical market report. We were making good progress on prepara-
tions for floatation when, around April, it became apparent that 7 million in capital
was already available from a combination of current investors and other parties such
as Stagecoach plc, who wanted to make an investment following its successful trial
of Envirox in 2004 and its decision to adopt the product. Our plan had been to raise
only around 8 10 million at the Initial Public Offering (IPO). Thus, we were
faced with a dilemma: If we carried out a full-blown listing, with an institutional
road show, we would almost certainly risk having to cut various parties back on
their preferred level of investment, thus disappointing either our current investors or
the incoming institutions. We decided to do a private round, raising 8 million, fol-
lowed by admission onto the London Stock Exchange AIM (Alternative Investment
Market). The potential benefits of admission were an important aspect of the fund-
raising. Firstly, we felt we needed to be public to improve corporate credibility and
visibility. Secondly, we wanted to be on the market so that we could begin to build
relationships with institutions and potentially respond rapidly to favorable market
conditions if we wished to raise further funds. Thirdly, it would make it possible to
use our paper in acquisitions. The downsides were also clearly understood: higher
reporting and corporate governance requirements. Also, the admission did not create
an exit event, nor did it create significant liquidity. On admission to AIM, the inten-
tion was to carry out either a future fundraising of primary capital or to organize
a structured secondary offer to facilitate the transfer of ownership from the private
shareholders to institutions such that the free float approached 20% or more and
allowed a normal market in the companys shares. Limited liquidity or a low trading
volume can mean that the share price is very susceptible to individual trades, which
can result in either the share price moving too high or too low and not tracking the
company performance.
Oxonica was very lucky with its founder investors. Richard Farleigh started
out with 20% of Oxonicas shareholding and has generally maintained his posi-
tion through the various rounds, now owning around 17%. He has achieved this
Pipeline Development
I have already spoken about the commercial products that Oxonica has developed
and launched. In addition, the group has a technology and commercial pipeline that
it is continuing to bring forward. The development of the Nanoplex technology is
a specific example of Oxonicas market focus.
Nanoplex Technology
Back in 2001 when we were deciding on the market areas to prioritize, diagnostics
was highlighted as having significant potential. A key fundamental driver for change
in the clinical diagnostics industry is the need to reduce treatment costs and improve
medical outcomes. There is a growing recognition by the health services, the phar-
maceutical and the diagnostics industries of the potential to improve healthcare by
a closer integration of treatment and diagnostics. Diagnostics have the potential to
impact throughout the medical process via developments in genetic profiling being
used to identify a latent health risk; improvements in the level of information from
conventional diagnostics (e.g., subtype of disease, stage of development of disease);
more rapid diagnostics to inform medical treatment in a timely fashion; the oppor-
tunity for instantly available personalized medicine, with a better match between a
drug and a patient (thereby reducing adverse drug reaction, which currently costs the
U.S. healthcare industry $130 billion per annum); and increasingly accurate moni-
toring of treatment and progress (theranostics). The establishment of a new gen-
eration of diagnostic testing technology that would allow faster, more precise, and
lower cost diagnostic testing is a key technical requirement to facilitate the required
industry changes.
Oxonicas original activities in this space were focused on quantum dots, which
are semiconductor materials with a light emission frequency (color) determined by
the specific nanoparticle size of the material. However, these semiconductor materi-
als are typically based on toxic elements, and the amount of possible simultaneous
detection of multiple colors or multiplexing is limited. Also, the sensitivity improve-
ments do not appear to provide significant improvements over incumbent technol-
ogy. So we looked at the feasibility of making tags based on complex inorganic
materials called polyoxometallates. This approach required a very specific synthesis
of a different material for each color. We abandoned this approach after about six
months as we realized that it was not possible to build a sufficiently large palette of
differently colored materials. This work, however, began to crystallize the technol-
ogy requirements: a convergent synthetic route leading to many unique or fingerprint
labels; significant improvement in absolute sensitivity; and good signal to noise ratio
relative to the background, which in this case would be biological fluids.
In early 2003, we identified a technology based on a technique known as Sur-
face Enhanced Raman Spectroscopy. Oxonica in-licensed this technology from the
University of Strathclyde and began to invest in developing the science into a com-
mercial product. Oxonica successfully secured a 450,000 DTI exceptional SMART
award over two years starting in January 2004, which contributed towards the costs
of demonstrating the marker technology. In late 2004, we became aware of a pat-
ent belonging to Nanoplex Technologies Inc., a company based in Mountain View,
California. It was immediately clear that these technologies were complementary.
We recognized the potential to act to consolidate and strengthen the intellectual
property position through an acquisition or joint venture. Nanoplex Inc. had a strong
technology team, led by Dr. Michael Natan, and needed to recruit commercial expe-
rience. Oxonica had a strong commercial team led by David Browning, who headed
up the healthcare activities. Oxonica had considerable commercial experience in the
clinical diagnostics market but needed to upscale its technology development activi-
ties. Thus the business needs were complementary, and the negotiations to acquire
Nanoplex Technologies Inc. began in earnest in September 2005.
We completed the acquisition of Nanoplex in February 2006, making the acqui-
sition for stock enabled by the fact that Oxonica went public in July 2005. The acqui-
sition allows the Nanoplex shareholders to participate in the growth of the combined
entity or to secure an exit.
The technology is currently being developed into a prototype with comparative
testing against current detection systems and assay formats. A prototype multiplexed
lateral flow device (LFI) to test for Flu A, Flu B, and Respiratory Syncytial Virus
(RSV) all together was showcased shortly after the acquisition was completed. This
simple device requires only a spot of saliva from the patient and can be easily read
and understood in minutes. The markers for these infections are visualized using cur-
rently available commercial equipment and tailored software. The LFI format already
has commercial application in point of care devices, including over-the-counter appli-
cations for pregnancy testing, but these are normally limited to yes/no single disease
detection. In a few cases, limited multiplexing has been achieved through spatial
separation on the test device. We believe that our showcased device where multiplex-
ing has been achieved without using spatial resolution offers a route to assays that are
easy to use and that provide significantly more information in one test.
Despite a number of potential end markets for this technology, including clinical
diagnostics, life sciences, veterinary, food testing, and bioterrorism, Oxonicas initial
focus has been on point of care applications that are easy to use. Oxonica has car-
ried out a detailed market analysis to assess the large number of product applications
possible and to establish which markets we need to partner to secure skills, market
access, or intellectual property. The analysis also sought to discover which mar-
kets have sufficiently low entry barriers for Oxonica to consider developing its own
products aimed at such markets. Oxonicas first major deal in the in vitro clinical
diagnostics space was concluded in August 2006 with Becton Dickinson, a leading
U.S. medical solutions company.
Security Markers
Losses from counterfeit goods are estimated to exceed 400 billion per annum. The
marker technology being developed for the clinical diagnostics program may also have
the potential to lead to commercial applications in security markets. Oxonica is in early-
stage discussions to consider developing a product for anti-counterfeiting requirements.
Product Pipeline
SolacorTM
OptisolTM
NanoplexTM
EnviroxTM
Security
Labels
The Future
Oxonica has now moved into a new phase in its development. The strategic plan
laid out in 2001 has been executed, and the company has a portfolio of product
opportunities. The level of revenue generation from these products has resulted in
the company having significantly more flexibility and control with regards to its
financing activities.
Looking to the future the key challenges facing the business are to:
A Personal Perspective
Money-raising can create anxiety and self-doubt, but, provided you believe in the
future of the company, the employees, the IP, and the unique products or expertise of
the company, you must give it your best shot.
Trying to drive through a new technology to market is extremely difficult, whether
in a large or a small company. The resilience and determination of the management
team and the investor base are both key to the successful growth of a young business.
One of my biggest challenges when I joined Oxonica was to get the organization
to accept the need to look outside and to be more inventive in its application of the
technology. I wanted to focus everyone on being driven by satisfying a market need,
even to the point that if any in-house technology, usually developed at great expense
and with much pride and excitement, fails to meet a market need, then ruthlessly
abandon it and seek another technology.
Building a public company from a university spin-out is all about giving people
the opportunity to influence their own future and to be part of a high-performing
team working on exciting projects that can make a real difference to our everyday
lives and producing profits for the shareholders.
Solutions Today
James R. Von Ehr II
Contents
167
nese Professor Norio Taniguchi predicted that atomically precise precision machin-
ing tolerances were coming and forecasted that we would achieve that milestone
by 2015. Eric Drexler articulated a nanotechnology vision more clearly in the late
1980s, calling it molecular nanotechnology or productive nanosystems. Drex-
lers vision was fundamentally different from Feynmans and Taniguchis in that he
realized that additive manufacturing (putting atoms where we wanted them) rather
than subtractive machining (grinding atoms away from where we dont want them)
would support an environmentally clean manufacturing process and much higher
value-add in manufacturing. We like clean, flexible, high value-add manufacturing.
Such a bold and dynamic vision of course has its skeptics. Skepticism about new
things has been around since the first cave dweller learned how to keep a fire. Take
this quote from The New York Times (October 9, 1903) commenting on the prospects
of heavier-than-air flight:
It might be assumed that the flying machine which will really fly might be evolved
by the combined and continuous efforts of mathematicians and mechanicians in from
one million to ten million years provided, of course, we can meanwhile eliminate
such little drawbacks and embarrassments as the existing relation between weight and
strength in inorganic materials.
Just 2 months later, on December 17, 1903, at Kitty Hawk, North Carolina, the
Wright Flyer became the first powered, heavier-than-air machine to achieve controlled,
sustained flight with a pilot aboard. So much for the predictions of the pundits.
Civilization advances by the actions of risk takers who are willing to ignore the
conventional wisdom of the masses that follow the critics. This is true in all areas of
human endeavor, not just technology. I recently met Mart Laar, former Prime Min-
ister of Estonia and winner of the Milton Friedman Prize for Advancing Liberty in
2006 for his brave reshaping of Estonia after the fall of the U.S.S.R. When forming
a new government, he received heaps of advice from the advice professionals on
how to tax and regulate this newly independent country. He chose instead to follow
a different path, against all the conventional wisdom and tested approaches, embrac-
ing deregulation, low taxation, and trusting individuals. Ignoring the wise men of
the international development elite allowed Estonia to become the most economi-
cally free country in Europe in just a few years. Conventional wisdom is usually not
wise. Entrepreneurs must be skillful at listening for gems of wisdom in advice from
the crowd, and from old experts, but be willing to ignore most of it to follow their
own approach. The market will be our judge, not the skeptics and pundits.
Against a backdrop of skepticism, I launched Zyvex because I thought nobody
else was doing nanotechnology right. This is a risky endeavor. There are a million
ways to go wrong. However, there are also a million ways to succeed. We need to
avoid going too wrong for too long but only need to hit one right pathway to succeed.
We have the big idea and now must execute it.
Michael Porter, the well-known professor from the Harvard Business School,
says there are two basic ways to be a leader in business: either by being a low cost
producer or a high differentiator. APM will allow us to be both simultaneously.
APM will be low cost, because the APM factory will be made with the same
technology as its products, driving the cost of the factory down as we get better at
manufacturing products in that factory. Nature works this way. A tree is an example
of natural Atomic Precision Manufacturing clean and green, making wood out
of air, water, and soil, powered by sunlight, and generating the oxygen we breathe
as a waste byproduct. And like a tree, APM should also be a clean manufacturing
technology, building things by rearranging the atoms in its feedstock materials rather
than processing vast quantities of materials while generating even larger quantities of
waste. Consider the amount of dirt that must be moved to make the steel in a single
automobile tons of iron ore, tons of coal to refine it, and tons of CO2 blown into the
air in the process. The machining of that steel generates even more scrap as we use
expensive precision machine tools to scrape away everything that isnt the shape of
the finished part. APM will allow us to manufacture in a better way, ultimately work-
ing from liquid or gaseous feedstock, and producing little or no waste. Of course,
early implementations are unlikely to be so clever and efficient, but just as improve-
ments in silicon technology affect all new integrated circuits from that point forward,
improvements in APM will affect all new products made with those systems.
With APM, we will also be able to customize products during manufacturing,
leading to high differentiation. The heart of our planned APM system is a program-
mable nanomanipulator able to direct chemical reactions to take place precisely
where they are desired building objects one molecular fragment at a time. Mas-
sive parallelism will simultaneously manufacture huge numbers of structured build-
ing blocks, which can then be assembled into larger and more complex assemblies.
Treating matter as digital information in this fashion will allow the economics of
software to apply to physical objects.
Designing atomically precise structures will be as complex and expensive as
designing a modern integrated circuit, but building huge quantities of those struc-
tures will be as cheap or cheaper than manufacturing integrated circuits. This
is because we apply the economics of digitization to matter, and this digital approach
will let us do for manufacturing what digitization has done for computation, control,
and communications. Precise, digital manufacturing will also allow us to control
errors and tolerances, which will allow us to make systems orders of magnitude
more complex than todays most complex manufactured object, the jumbo jet, with
as much control over the quality of the final product as we care to design.
Nanotechnology promises to be both a disruptive and an enabling technology. A
disruptive and enabling technology is something that is so unique and extensive in
its capabilities that it creates a market pull.
There have been such technologies throughout history, but a recent example is
the integrated circuit. Consider the impact that the integrated circuit has had on our
lives, not only here in the United States but all over the world. Most business people
believe that nanotechnology has that same potential on an even larger scale.
The integrated circuit industry is similar to APM in certain ways. An integrated
circuit factory, known as a wafer fab, can make an unlimited variety of different
integrated circuits, determined by the software that makes the optical masks used
to define the integrated circuit features. By changing the geometries of the mask,
but using essentially the same processing steps, the products of that factory can be
changed minute to minute as different silicon wafers flow through the wafer fab.
APM will deliver similar capabilities with a wider variety of products.
Why are more companies not working on APM? Because it is a hard prob-
lem, and the time to success could be very long if brute-force approaches are used.
Conventional chemistry will require many, many decades at its current pace to even
come close to these capabilities and will never deliver the flexibility to manufacture
different products in a common factory, nor the error control necessary to control-
lably make complex systems. Chemists who imagine the solution-based chemistry
they were trained to do suddenly enabling the manufacture of complex atomically
precise objects are right to be skeptical conventional chemistry wont work. Suc-
cess in APM will require an interdisciplinary approach, bringing together chemistry,
engineering, and software-based system design. That is the vision of Zyvex.
to make a composite product or service. They then sell it to people who will pay
more than it cost the merchant to bring it to the customer. This is the classic business
person responding to a visible market. Creators invent a new thing that has never
before existed, hoping to make something other people will find valuable enough to
buy. These entrepreneurs take more risk but can achieve great rewards if they cor-
rectly develop a product people want and can market that new product successfully.
If people initially do not laugh at their new idea, the idea probably is not bold enough
to be successful at creating a new market. It might fill a niche in an existing market
but wont become a disruptive innovation.
My favorite technological innovation of the last 50 years is the Apple personal
computer. Invented by a couple of engineers who had worked at Hewlett Packard, the
apocryphal story told about it is that Steve Jobs was in his boss office pitching the
concept, and his boss declined to get HP into that business, saying it was a cool idea
but that the only two people in the world who would buy it were those two engineer-
ing geeks. Jobs quit HP to pursue his vision, and thanks to the correctness of that
vision, the superb engineering of his partner Steve Wozniak, good business advice
and adequate funding, and the (eventual) pragmatism to adjust the vision to market
realities, the personal computer became a huge, society-transforming success. The
original Apple computer was also an excellent example of a product where all the
pieces were available individually but had never been put together in the right way to
make a breakthrough product. How many other new categories of valuable products
are waiting for clever entrepreneurs to invent them?
MBAs study the differences between technology push companies and market
pull companies. Sales are easier for a market pull company the products solve an
existing problem, and customers can easily understand why they want to buy a prod-
uct that solves their problem. On the other hand, technology push companies have to
educate their customers and teach them why they need the product. Sales growth is
slow for companies that have to educate their customers, because educating people
is expensive and time consuming. Technology push companies may not even hit the
correct market on their first try and may simply educate the market for a market pull
competitor to come to market later and grab all the volume sales. Everyone knows
that companies should be developing products with market pull instead of technol-
ogy push.
I believe the best strategy for a pioneering technology company is actually
push-pull. Breakthrough product creation cannot be done via a formula, because
a lot of the act of creation is unquantifiable it takes an entrepreneurs instinct,
and luck, to succeed. By luck, I dont mean blind luck, like winning the lottery,
but the kind of luck that comes from being prepared and being in the right place
at the right time for success. So here is my push-pull strategy for innovative prod-
uct development: push the technology envelope to create a product with market
pull. The market pulls products, not technology. If youre just selling technology,
youre going to have to work too hard to achieve success. Use the technology
inside the product to differentiate that product, but dont try to sell the technology
for its own sake.
Push the technological envelope to develop a prototype of something the product
creator has a passion for, and an understanding that there is a big market for (OK,
this is harder than it sounds if it was easy and obvious, everyone would be able to
do it). No market survey will turn up a major demand for a product that people cant
imagine, but if people can see a prototype that meets at least some of their needs,
they can almost always articulate how to make that prototype better. Now find a lead
customer who can represent the product user for a broad base of users, and then use
that customers feedback to develop a final product that will be pulled into the mar-
ket. If you cant find such a lead customer in three tries or less, or they cant inspire
you with ways to attack a bigger market, you probably didnt have the right product
idea or understanding of the market. Give up that product and show your creativity
by developing another one. Push the technology envelope; dont push products.
Success requires the right instincts to get close to something a customer wants
with the first product, good marketing in picking the lead customers to work with to
refine the prototype, good listening skills in teasing out how to improve the product,
and good execution skills in developing the final product. I dont think its possible
to do this with a success formula, but it also isnt something that takes genius to
accomplish. It took me many years to learn to trust instinct as a rationalist, I
denied the validity of a process I couldnt analyze. I finally came to a rational expla-
nation; what we call instinct is a nonconscious type of information processing that
connects things we arent consciously able to analyze. There is nothing wrong with
trusting instinct, if you verify that trust with reality. If you doubt this, think analyti-
cally about how you choose words when you speak (and if you can analyze how you
speak, immediately write that algorithm into a computer program, because youve
just come up with a very valuable artificial intelligence program.)
Funding Research
Venture Capitalists. Weve heard them called bad names, and entrepreneurs fre-
quently like to talk about our bad experiences with them, but be careful some
of my good friends are venture capitalists. I just dont ask them to invest in my
company. Venture capitalists are usually the funding source people think about first,
but raising VC money to build a company should be approached with open eyes and
awareness. Never forget that they get involved to make money, and the most success-
ful ones dont care about you or your technology except for how it helps them deliver
a great return to their funding sources, the limited partners. VCs have an aversion
to funding research, due to a natural desire to reduce needless risk, the short time-
frames they operate on, and ready availability of other, less risky deals. Beyond aver-
sion, they actively spurn science projects, and rarely want to be the first and only
investor into a new technology. And if they do participate, they take a large percent-
age of the company in return for their funding. This isnt always bad, since the com-
pany may be more valuable due to their presence in the deal, but theyre more likely
than any other class of investors to shut the company down or sell it prematurely if it
disappoints them. VC money is prestigious, but expensive. Most entrepreneurs will
be fired and/or cashed out of the company before it becomes successful, so go into
these deals expecting such an outcome.
Another funding source often used by entrepreneurs is known as FFF: friends,
family, and fools. This is a great source of funds for start-ups but often leads to a bad
capital structure, with too many tiny shareholders and all too often some restrictive
covenants or antidilution provisions. I have seen companies with such a bungled stock
ownership structure that they were unable to raise money without making some very
difficult changes to their ownership and, in one case, enduring an expensive lawsuit
from a disgruntled early shareholder. I was going to question why lawyers dont warn
more strongly against companies bringing in large numbers of small owners, but the
last clause of the preceding sentence (expensive lawsuit) really answers the ques-
tion. Accepting shareholders who individually invest less than 12% of the capital to
be raised will eventually hurt you more than the money will help you.
Large corporations pulled back from funding their own basic research as it
became less affordable, and activist shareholders and analysts encouraged them
to focus on quarterly earnings instead of long-term and risky development efforts.
Increasingly, large public corporations fill their product and technology pipelines
with technology and products purchased from small companies. They might fund
a small company to tailor an existing product for a special purpose but would
rarely fund a new product development program. Corporate venture capital arms
fund quite a bit of research but these days rarely lead funding rounds, preferring
to ride along with larger VC firms. Corporate capital can be good, or it can be
bad. The good part comes in getting to know a big company that might buy your
products, or even your company, in the future. The bad part comes in restrictive
covenants about who you can sell products to (not their competitors!). All in all, I
think corporate money for development is a good thing. Large corporations need
small, innovative companies to keep their product pipelines full. Contracts will
probably feature a tough negotiation over intellectual property, but large corpora-
tions can be great partners.
Funding an early prototype with savings or government research money will
usually result in the best deal for the company and entrepreneur. In my previ-
ous software company, I was able to significantly raise the terms of a licensing
deal by bringing the prototype closer to reality in the time between discuss-
ing a rough prototype with those potential licensees and showing them a nearly
releasable prototype. If you cant show a prototype, any deal you might get with
a customer, partner, or acquirer will be a fraction of the deal youll get with a
demonstrable prototype. Speed of execution for delivering the prototype is incred-
ibly important.
Use government R&D money if you can, because it doesnt dilute your owner-
ship of the company or complicate your capital structure. Just dont fall into the trap
of thinking the government is your customer, unless youve set out specifically to
sell things to the government. Any government money comes with strings youll
be reporting, accounting, justifying, changing how you run your business so it is
more easily monitored, and reporting more on every dollar. There is a lot of red tape
involved with government funding, so it is important to get out to the real market as
soon as possible.
Our initial research was funded directly by my investment into Zyvex and led
to some early scientific papers that helped establish our reputation. Figure8.1 shows
the first ever picture of a carbon nanotube being pulled apart in a Scanning Electron
A B
10 m 2 m
C D
200 nm 500 nm
Microscope using our first nanomanipulator, built in 1998. This led to a publication
in the prestigious journal Science.
As we grew, we decided to apply for government funding for a risky research
program we needed to make our top-down approach work. On the recommendation
of a program manager in the National Institute of Standards and Technology
Advanced Technology Program (NISTATP), we partnered with three universities
and another company and submitted a proposal for a $25 million/5-year cost-shared
program (Zyvex paid 50% of the costs) entitled Assemblers for Nanotechnology
Applications and Manufacturing: Enabling the Nanotechnology Era. In 2001, we
won this award to develop systems that provide highly parallel microassembly and
nanoassembly for real-world, high-volume applications.
That program allowed us to develop a risky and otherwise unfundable
microassembly technology that has spawned a number of technologies and product
prototypes, including:
The goal of research for any company should be to get a product out. Research for
its own sake is great for universities and government labs, but any for-profit business
needs to get past the research stage and onto a product as soon as it can. It doesnt have
to be a finished product but does need to show off most of the essential features.
Engineering to Development
Once I made the decision to move Zyvex from research to development, we chose
nanomanipulation as our top-down product technology and nanomaterials as our
bottom-up product technology. We then developed specific products in each of those
technology areas, which will be discussed later. We continued to work on our NIST-
ATP contract, but that technology development was still too far away form market to
deliver any immediate products, so it remained an R&D program.
We built our first nanomanipulator system in 1998 to pull apart nanotubes in
a Scanning Electron Microscope, as already described. We looked into marketing
that system in 2000, but a brief market study showed that the market was too small
to be worth the engineering costs of developing a nanomanipulator as a product.
After the National Nanotechnology Initiative was launched, we took another look
and decided the market had become large enough to sustain the product devel-
opment effort, thanks to NNI money funding directed nanotechnology-related
research in universities and government labs. We decided to commercialize our
prototype nanomanipulator so it was manufacturable and supportable and take it
to market quickly.
This decision not to launch too early was important. Just because we had some-
thing that was cool and which did a novel task was not a reason to develop it as
a product and push it to market. Too many technology companies fall in love with
their technology and fail to ask the hard question of who will really buy that product.
We built this product because we needed it for our own research but used market
research to demonstrate that we were too early and waited until the market caught
up with us. Once we determined that the market was ready, we aggressively moved
into the development phase.
We hired a director of product development and several engineers and turned our
lab prototype into a commercial product in less than a year. Since we had used this
tool to do our own work, we could serve as our own main customer, which meant
we knew the pitfalls and possibilities of such a nanomanipulator. A picture of the
released version of prototype nanomanipulator can be seen in Figure8.2.
Like most small companies, we were able to launch this product without a heavy
dose of processes and procedures because the product development team was small
and tightly coordinated and had previous product development experience. Like
most survivors of that approach, we wanted to do better in the future, so we adopted
a product development process that Ill discuss later.
materials, and structures that provided our technology base to build products for the
market segments of aerospace and defense, healthcare and medical, and Semicon-
ductors and electronics.
An engineering company can develop fantastic products, but without marketing,
nobody will know about them, and nobody will know about the company. Our CMO
established worldwide distribution, organized a sales force focused on application
sales engineering, and focused the entire organization on execution.
During this time, our nanomaterials business was starting to develop, thanks
to our development of some proprietary technology to process carbon nanotubes.
After some exploratory product introductions, we found a real lead customer, Easton
Sports, which we learned how to satisfy with products that led us to many more mate-
rials markets. Ill have even more to say on the materials business when I describe
how we launched our tools business.
Figure8.3 Zyvex Technology Base and its interaction with targeted markets.
how clever their company is they spend their time helping the customer to under-
stand how the company product solves customer problems. Engineers often, and
scientists almost always, try to impress people by explaining the complex technology
and the engineers or scientists part in creating that technology. Remember, custom-
ers dont buy technology they buy products that meet a need. Stay paranoid, and
dont fall in love with your technology.
We met customers by taking a mockup of our nanomanipulator to trade shows,
where we could meet several potential customers at once. Picking the right trade
show is worth a chapter in its own right, but Ill just say there are a lot of shows, and
not all of them are equally worthwhile. It is beneficial to measure prospect and lead
generation from every show, and drop those that dont measure up.
At one show, a major semiconductor manufacturer came to our booth and asked
if we could probe their integrated circuits, which at that time had geometries less
than 90 nanometers in size and couldnt be probed with any other tool. In a textbook
case of listening to our customers (or customers-to-be), we told them we would try, if
they would send us a chip. Several weeks of development later, we had successfully
solved several key problems of probing and showed them the results of probing their
chip in our electron microscope.
They were impressed enough to want to probe more chips, so we rented them
time on our prober system while they got comfortable with the system. Word got
around, and most of the semiconductor manufacturers started renting time on our
system, and all submitted purchase orders to buy their own system. See Figure8.4
for a sample illustration showing three probes on an integrated circuit. The round
dots on the surface are contacts, and they are about the size of a virus.
Figure8.5 (See color insert following page 16.) Zyvex nProber with positioners aligned
250 microns apart from each other, just a few millimeters above the center stage.
Our new nProber, in Figure8.5, can now land up to eight probes in an area less
than one quarter the size of this image, which works out to about one wavelength of
light. Thats small, in case you were wondering.
Following up on this one inquiry led us to a major market in the semiconductor
industry, which is now by far our largest customer segment. Add-on products such
as extremely sharp probes and other types of probing and sample preparation tools
will likely mean the semiconductor industry will continue to be our largest market,
dwarfing the original research tools market. This success came about because we
listened and adapted to the market need.
We are beginning to use the MEMS components from our NIST-ATP in the
tools business, which has now broadened into the instrumentation business thanks
to our success in both tools and MEMS. From micro-tweezers to miniature mass
spectrometers, these businesses are converging to provide an unparalleled ability to
build miniaturized analytical instruments. We will continue to follow our prototype,
test, refine, sell sequence for these future products.
by the long and expensive process of lawsuits, which can take years and millions of
dollars to conclude. Trade secrets protect the key processing steps so long as they
remain secret but once divulged offer no protection whatever. A combination of the
two is a powerful safeguard for proprietary technology.
Early on, we made the decision that our strength was in processing, not manu-
facturing CNTs. This has proven to be a good decision there are currently more
than 50 CNT companies worldwide, so becoming the cost, volume, or quality leader
would be stunningly expensive. As we investigated some of those companies, we
found a widely variable range of quality and repeatability in manufacturing CNTs.
This led us to develop a CNT certification program, where we ran a number of
tests on CNT samples to find the companies with the best quality control. We certi-
fied several companies and developed a close relationship with a few key partners,
including Paris, France, based Arkema a seven billion euro per year chemical
giant. Arkema became our prime supplier for the most cost-effective form of nano-
tubes called multi-walled nanotubes.
With our processing technology, our chemists do molecular engineering of a cer-
tain class of molecules in order to design just the right molecules that can interact with
the CNTs and get a good dispersion in some host polymer that we can then process
further. This is not quite the bottom-up nanotechnology we need for APM but is a
good example of a mixed-scale system containing a structured interface from the size
of molecules up to the size of microns. The dispersion-enabling molecules live in the
molecular world. The CNTs live in the molecular, nano, and micro worlds simultane-
ously. When put into the right host material, CNTs can be embedded into macro-scale
objects and deliver increases in performance at the human size scale or bigger.
We had invented the processing technology but werent sure in what form cus-
tomers might want the CNTs powders, dispersions in solvents, or dispersions in
host polymers. We offered all of those for sale on our Web Site and took several
forms to trade shows to meet potential customers. Early orders did not show any
pronounced trends for one form over another, since all the customers were still in
testing mode. We continued to improve our processing capabilities as we collected
data about how much improvement in materials properties was achievable with prop-
erly processed CNTs.
Before long, Easton Sports became our lead customer for nanomaterials, based
on meeting us at a trade show. Easton is a midsized, highly entrepreneurial company
that is a leader in several kinds of sports equipment such as baseball and softball
bats, hockey equipment, and high-performance bicycle parts. They were looking for
a way to improve their equipment by using nanotechnology. We showed them some
early data on how to improve the properties of polymers such as epoxy by adding
CNTs, and they decided to give this a try in their carbon fiber composites.
Todays highest strength materials use sheets of carbon fibers laminated together
with high-strength epoxy to make composite panels or structures. These carbon
fiber composites are extremely strong and light but suffer catastrophic failure when
stressed beyond their limits. The failure mechanism is usually delamination of the
carbon fiber sheets due to inadequate strength of the epoxy holding them together.
Funded by a NASA research program to build the worlds highest strength-to-
weight ratio material, we were developing a unique composite-in-composite for high
Figure8.6 (See color insert following page 16.) This Easton road bike, created using
Zyvexs NanoSolve materials, was given to President George W. Bush in June 2006.
strength materials. Our approach puts CNTs into the epoxy that binds the carbon
fiber sheets together, strengthening the epoxy, and thus strengthening the entire
structure. CNTs not only fill and strengthen the spaces between the carbon fibers
that would otherwise consist of only resin, but the long, high-strength strands help
hold the structure together by stopping cracks.
Easton became our first commercial-scale materials customer, working with us
to develop a reliable process for making carbon fiber composites using CNT-rein-
forced epoxy. In a remarkably short nine months, they were able to release the first
CNT-reinforced bicycle parts, which delivered 1020% performance improvement
in material toughness. The result is a full-size, 20-speed road bike that weighs less
than 16 pounds, yet is stronger and stiffer than most bikes available on the market
today (see Figure8.6). Easton then introduced CNT-reinforced hockey sticks and a
baseball bat that has bigger sweet spots and maximum performance along the entire
length of the barrel (see Figure 8.7).
Once Easton had made some actual CNT composite components and we had
performance data showing the efficacy of CNT material, our next tradeshows were
more fruitful, with numerous companies coming by our booth to learn how to use
our NanoSolve material in their products. Eastons role as lead customer was to help
us understand the most useful form of NanoSolve material CNTs in epoxy and
to demonstrate real products made with this material, delivering real performance
gains by the use of nanotechnology.
Our current NanoSolve business is growing at more than 50% per year and
likely to accelerate as our customers learn more about processing nanomaterials and
increase their adoption.
Figure8.7 (See color insert following page 16.) Easton Stealth/Synergy line of baseball
bats.
Focus
Some people have said we are unfocused because we are trying to do too many things
at once. Conventional wisdom says to do one thing, and do it well, so all the compa-
nys attention is focused. That is great advice for most companies in most established
fields. In my software company days, we were focused on desktop publishing as a
market and sold two sequentially developed products as our key products. But con-
ventional wisdom also says most new companies fail. Maybe as an entrepreneur it
doesnt pay to listen to conventional wisdom.
Businesses involved in nanotechnology tend to be more diverse in their products
than most other companies. They have a wider variety of products, sold to a wider vari-
ety of customers, than a typical start-up. This may be due to the limited size of markets
consuming nanotechnology-enhanced products a one-product company probably
will not have enough sales of that one product to sustain itself as the market grows.
It is just not prudent, at this stage of nanotechnologys development, to go after
a single niche market. And, it is too early to say what the real market potentials are.
We have developed a set of heuristics, including the accessibility of the market, the
size of a given market, our core competencies, alignment with our overall goals, and
others. We look at various applications and market segments that we believe we can
impact. We target only those applications where we believe we can be a leader.
Processes
Some managers think their processes drive companies to greatness, but peoples
creativity and judgment are what really does it. Processes should be employed to
support people by making sure we dont forget things or make the same mistakes
twice. They are not replacements for good judgment or talent.
Do not fall in love with a process it should be there to support you, not con-
trol you. We use a formal new product development process to manage our product
releases. Generically, this looks like a stage-gate process, where we move along a
checklist that has certain requirements that must be met at each stage before moving
through the gate to the next stage of the product development cycle. This process
helps us assure that we have performed all the steps necessary to develop a product
that can succeed but is no substitute for managerial and technical skill and judgment
along the product development path. It is possible to meet all the criteria of such a
process, even including market studies and customer identification, and still make a
product that does not succeed. We know it has happened to us. We strive to use
this process as a craftsman uses a tool, not as a bureaucratic obstacle to progress.
We treat this new product development process as a living document and con-
tinue to modify it frequently as we develop better ways to do things.
We also have a number of processes relating to our quality program. We became
ISO 9001:2000 certified in late 2005, because we wanted to demonstrate our com-
mitment to quality. Very few nanotechnology companies have bothered to earn ISO
certification, but we pursued that because we believe that documenting our processes,
and being committed to improving those processes over time, is an important part of
our future. We sought official certification, rather than using an informal approach,
because we want to be measured and want to be sure our customers know we have a
commitment to quality.
Psub
Gate S/D
S/D
1 m EHT = 2.00 kV File Name = 165_203_?? Signal A = SE2
MAG = 11.61 KX Date: 20 Feb 2004 Focus = 8 mm
Figure8.8
Selling to more customers in your market segment can happen either because
your marketing works and more people have heard about you or because you learned
from existing customers and added some key features the new customer needed that
were not in the original product. Basic marketing, but it works.
Partnering
People often ask us what enabled Zyvex to so rapidly develop products and applica-
tions and penetrate the markets we targeted. Hiring smart and talented people is a
given, and stressing execution keeps us focused, but there is one more important
piece the great partnerships we developed with others. From day one, we decided
we wouldnt suffer from NIH (Not Invented Here) syndrome and that we wouldnt
be all things to all people.
In a business, you have to decide what not to do just as much as what to do. There
are so many potential opportunities to target with nanotechnology that it would be
easy to lose focus. We want to be broad enough not to miss great opportunities, yet at
the same time, we cant do everything. We cant dilute our resources on loser projects
or programs. If you know of a gap in your technology or in the implementation of
your marketing strategy, partners can be a wonderful asset as long as they result
in a win/win relationship.
Final Thoughts
Nanotechnology is exciting, but we still must manage it as a business. We need to
make products that customers want, so we can make a profit. We want to keep our
eye on the long-term goals of the company, so we know where were going, while
executing to our plan in the short run, so we can see how were doing on getting
there. There are lots of other things that we do, and have done, that time and space
limitations preclude mentioning. Suffice it to say that the way we run the company
helps us perform like a much larger company than we are. Our executives have all
worked in larger companies, so the processes we have in place are there to prepare
us for high-quality, sustainable growth. We have accomplished a lot since starting
out in that first little office, but we still have the largest part of our journey ahead of
us. It is exciting to see what weve accomplished and envision what we will do. It is
frightening to see how much more remains to be done. Most of all, its interesting. I
have only told you a little of Zyvexs story a few anecdotes from the journey, with
a few tidbits of lessons learned. I encourage you to watch us at www.zyvex.com.
References
Zyvex, the Zyvex logo, MEMulator, NanoEffector, NanoSolve, and NanoWorks are regis-
tered trademarks, and Kentera is a trademark of Zyvex Corporation. SEMulator is a
trademark of Coventor, Inc.
Development of a
Successful German
Microsystems-
Based Business
Reiner Wechsung
Contents
Introduction............................................................................................................. 189
Origin of the LIGA-Technology............................................................................. 190
Foundation of microParts GmbH First Steps into Business.............................. 193
Products.................................................................................................................. 201
Nebulizer for Drug Delivery.......................................................................202
TRUSPRAY.................................................................................................206
Microfluidics................................................................................................207
Microspectrometer....................................................................................... 214
Technology.............................................................................................................. 216
Intellectual Property............................................................................................... 220
Commercial Results (Sales, EbiT).......................................................................... 221
Human Resources and Organization...................................................................... 223
Conclusion............................................................................................................... 225
Introduction
microParts GmbH was founded in 1990 by STEAG AG with the mission to com-
mercialize applications of the newly invented LIGA-technique. STEAG-microParts
is an example of how a research-driven project became a commercially successful,
market oriented, profitable business.
189
By showing drawings and a few samples that had been produced in the research
laboratory, several visionaries convinced the management of STEAG, together with
four additional shareholders, of the market opportunities for microtechnology-based
products. The task for microParts, therefore, was to identify products that could form
the basis for a profitable business and develop the appropriate production processes
to take these products from a laboratory scale up to industrial mass production.
The expertise of microParts lay in its understanding of the technology, so the
best way of building a business was to find customers who could apply the unique
features afforded by this new technology into their development programs so as to
improve existing products or produce new ones. Examples include improvements to
spinnerets nozzles and the development of noninvasive blood analyzers. The com-
panys objective was to work with customers who were prepared to enter into a long-
term business relationship.
In this chapter, the business development of microParts is described from its
inception, with all the complexities of a start-up company, through to a strategically
focused, profitable operation.
Developing
Resist Structure
(a)
Figure9.4 (a), the ground plate with resist columns is shown, and in Figure9.4 (b),
the corresponding nozzle after plating with nickel can be seen.
The performance of the LIGA-technique was described in acquisition material
as follows:
Height: 20500 m
Maximum dimension: 2060 mm
Minimum dimension: 2 m
Smallest structure detail: 0.5 m
Materials: nickel, nickel/cobalt, copper, gold, PMMA,
POM ZrO
Plastic Moulding
and 2nd. Electro-
forming/Casting Slip
Mould Cavity
Mould Insert
Plastic
Mould Filling
Electrically
Conductive
Substrate
Mould Removal
Plastic Structure
as Lost Mould
or Final Product
Metal/Ceramic
2nd. Electroforming
Metal or Ceramic
Final Product Structure
(b)
figure9.2 (Continued).
The research teams also demonstrated the potential for low-cost mass produc-
tion, which could be realized by German industry under licensing agreements and
supported with technology transfers from the research laboratory.
400
300
100
0
7.0 7.2 7.4 7.6
Structure Width b (m)
(a) (b)
Figure9.3 (ab) Resist structure of height 400 m, 7 m wide with a deviation of 0.1 m.
which was important and very useful because of the requirement for the transfer of
a substantial amount of know-how to microParts, thus allowing it to initially use the
research centers equipment.
Together with Hoesch AG, Huels AG, VEW AG and Rheinmetall GmbH,
STEAG founded microParts GmbH in 1990. This new company was relocated from
Karlsruhe to rented offices in Dortmund from January 1, 1994. It contributed to the
structural change of the German Ruhr area from coal- and steel-based industries to
new high technology; it therefore received support from the government of North-
rhine Westphalia and the European Commission.
The shareholders of microParts, who had been convinced by the visionaries from
the research group of the extraordinary business potential of the LIGA-technology,
were ready to invest in a new business with expectations of a good return on their
investment and the securing of profits within five years.
The first LIGA-brochure prepared by the STEAG team during the foundation
period of microParts, shown in Figure9.5, described a large variety of product ideas
in the following list of categories:
100 m
(a)
10 m
(b)
Sensor components
Microactuators/Micromotors
Fluid components
Components for microelectronics
Components for microoptics and integrated optics
Micromechanical components
Microfiltration components
Microstructured layers
The development teams of STEAG and the Institute for Microstructure Technol-
ogy produced some demonstrator samples for what they expected would be typical
LIGA-products, shown in Figure9.6 (a-g). With these promotional materials, on the
potential of the technology together with functional models, a broad marketing pro-
gram was started with sales literature, exhibitions, and presentations at conferences.
The initial enthusiasm of the research-oriented teams soon turned into skepticism
because the expected orders were not realized, and the goodwill of the few interested
customers turned into disappointment with the realization that the technological pro-
posals took too long to produce.
With the foundation of microParts, the shareholders realized that excellence in
R&D is not sufficient to build up a profitable business. They therefore hired an expe-
rienced business manager with the necessary technical expertise. This was the start
of the process of developing microParts into a professional business enterprise.
The first step was to reexamine the technology in order to define achievable
specifications that could be met without further development efforts. As a result,
ceramics were removed from the acquisition list. The broad list of potential products
and applications was compiled into a priority ranking using the following criteria:
200 m
(a)
50 m
(b)
200 m
(c)
50 m 50 m
(d) (e)
Figure9.6 (Continued)
100 m
(f)
100 m
(g)
Figure9.6 (Continued)
Examples are:
From the many product ideas that were presented by the initial research team,
only two projects fit into the newly defined strategy an optical coupler and a
200 m
microspectrometer. Here the plan was for microParts to present a product develop-
ment proposal that included final production. The commercialization of the product
would be undertaken by a strong customer who is already operating in the respective
business area. The LIGA-produced coupler for optical fibers, offering as an advan-
tage a very low surface roughness, in the order of 2030 nm, which results in low
scattering losses and the possibility of molding with optically compatible polymers
such as PMMA and PCs. Such an optical coupler is shown in Figure9.7.
Good initial interest was shown by large players in the U.S. and Japan, which
indicated some promising business opportunities. It turned out that telecommunica-
tions had a large potential, but a real breakthrough was still remote. Therefore, in
the mid 1990s, microParts decided not to target the telecommunications business.
As a result, the microspectrometer remained the only product to be developed and
marketed by microParts and is described later in this chapter.
A very promising project was started for microParts to develop an ink-jet head
for a medium-sized company that was established in the ink business. The project
was of strategic importance to the customer, who was committed to investing in the
new business and needed microParts for the development and future production of
the product. As a result, a very efficient development project a nozzle plate for a
300 dpi ink-jet head was developed, as shown in Figure9.8. During the course
of the program, microParts took over the development of the complete ink-jet head.
Within two years, serial production of a few thousand ink-jet heads with excellent
performance was completed. Unfortunately, during the negotiations to finance the
scale-up of the production, it became impossible for the customer to obtain a manu-
facturing license for the patent protected ink-jet head. This was a big surprise for
microParts, which had assumed that a customer who was making million-dollar
investment decisions would have ensured their rights to produce the product. During
the negotiations with the big players in the ink-jet business, microParts realized that
in order to protect its core competence, it had to refuse to cooperate with small sup-
pliers, even if they could offer some technological advantages. Although microParts
50 m
(a)
20 m
(b)
Figure9.8 (ab) Ink-jet nozzle plate.
had not lost money on the ink-jet project, it tied up resources without the prospect of
developing a new business. Nevertheless, microParts had strengthened its technol-
ogy portfolio in microtechnology with the valuable know-how it had gained from its
work in microfluidics.
Products
As a result of the intensified marketing and acquisition activities focused toward
the criteria described earlier, a few customer projects were acquired that offered the
23 25 21
(54) Atomising Devices and Methods 4 1
potential to build up a steady new business after the successful completion of all the
phases of a well-defined development program:
Both parties had the option to terminate the cooperation if the well-defined cri-
teria of any phase could not be achieved. Parallel to the ink-jet head and optical cou-
pler projects, microParts had started a few customer projects that fulfilled all above
mentioned requirements and that successfully completed all phases from feasibility
tests to large-scale production.
5 m
(a)
5 m
(b)
Figure9.10 (ad) Micronozzles for Respimat.
In the early stages of the project, the role of microParts was to develop micro-
nozzles with 5m holes in different shapes in order to generate a spray with an
aerosol droplet size of 5 m. Examples are shown in Figure9.10 (ad). microParts
development task was expanded into the development of a nozzle unit in combina-
tion with a filter structure to deliver the specified spray characteristics. Employing
a semi-empirical approach, different nozzle principles were investigated, ultimately
resulting in the uniblock (shown in Figure9.11).
The uniblock consists of a filter structure including two micron-sized outlet
channels built onto a silicon wafer. The drug solution is forced through the channels,
5 m
(c)
5 m
(d)
Figure9.10 (Continued)
producing two fine jets of liquid that converge at a carefully controlled angle. The
impact of these two jets generates the slow-moving soft mist. The generation of the
soft mist lasts for more than a second, compared to about 0.2 seconds for the clouds
generated with a propellant gas, and this facilitates the coordination of actuation and
inhalation. Depending upon the formulation, between 66 and 81% of the droplets of
the Respimat fall into the fine particle fraction (less than 5.8 m), compared with less
than 40% for the majority of metered dose inhalers.
With completion of the uniblock, a device for a drug delivery system, including
a pressure-generating system for the micro-nozzle, had to be developed. Boehringer
Ingelheim contracted that task to medical device manufacturers who were well
established in that field. Very soon it became obvious that a substantial competence
in microstructure technology was required for this to be successful. In order to avoid
a complete failure of the project, microParts proposed a design of the complete nebu-
lizer system and built a working prototype. This was accepted by Boehringer Ingel-
heim, which then contracted a supply agreement with microParts for the complete
nebulizer.
Figure9.12 shows a schematic diagram of the Respimat with its unique delivery
mechanism that utilizes the energy from a tensioned spring to generate a soft mist. A
simple 180 twist of the inhalers base compresses the spring and draws a predefined,
metered volume of solution through the capillary tube and into a dosing chamber.
When the dose-release button is pressed, the energy released forces the solution
through the uniblock to form a soft mist of fine aerosol particles.
During the development program, all the required specifications were met, and
microParts also took responsibility for the design of an attractive, easy-to-use product
(see Figure9.13). When the prototype was completed and a frozen design had been
agreed, microParts was contracted to develop the production processes according to
medical GMP rules (Good Manufacturing Practice) and to scale up the production
to a capacity of 10 million devices per year. Whereas the development costs for the
prototype were just above $10 million, the budget for production scale up exceeded
$100 million. This is explained by the complexity of the workload involved in this
task. In most cases, this is underestimated by start-up companies.
The microstructure technologies applied to Respimat production combine sili-
con micromachining, micro-injection molding, mechanical micromachining, and
specific mounting and assembling procedures. A robotic system for mounting and
assembling was specially developed and proven for the assembly of 40 Respimat per
minute, shown in Figure9.14 (a-d).
In addition to the long development and production scale-up times, the oblig-
atory clinical tests determined the timing of the first market introduction, which
became possible in January 2004. With new drugs under development for delivery
Figure9.12 (See color insert following page 16.) Schematic diagram Respimat brochure.
via the Respimat, this unique product looks forward to a prosperous growth over the
coming years.
TRUSPRAY
With completion of the Respimat development and production program, a system-
atic search was started to apply this competence in micro-nebulizer technology to
nonpharmaceutical applications in order to ensure further growth of the microParts
business. It soon was recognized that the Respimat principle, with its limitation
of released dose of a few microliters per single shot, was not applicable to mass
markets like perfume, deodorants, or hairspray. In a systematic search, microParts
investigated other nebulizer applications in order to find a unique opportunity for
microParts core competence in microtechnology and one that would offer functional
improvements to the large aerosol markets. The final choice was an innovative aero-
sol particle generator based upon capillary atomization as shown in Figure9.15.
The use of capillary tubes instead of swirl chamber nozzles makes it possible,
for the first time, to spray highly viscous products at optimum flow. Due to low flow
rates, capillary atomization does not need highly diluted formulations. The result
is a significant reduction of solvents and propellants (VOCs) compared with exist-
ing products. Products can be sprayed much more effectively, reducing amounts of
solvents and propellant gases down to 20% of conventional aerosol systems, and thus
offering an environment-friendly alternative. In addition, higher viscosity products
such as concentrates, lotions, gels, and even waxes can be delivered as an aerosol
spray.
Lowering the proportions of propellant and solvent enables the size of the aerosol
cans to be reduced, which is an additional advantage in function and cost. Together
with the German tube manufacturer Tubex, a leading supplier of aerosol cans, a new
innovative shaped can was developed in order to establish TRUSPRAY as a unique
registered trademark (shown in Figure9.16). The high recognition oval shape makes
the product attractive and user friendly.
Since mass production and sales of aerosol products are not in the area of mic-
roParts core competence, a business model was developed based upon the establish-
ment of licensing agreements with a network of leading European suppliers, each
having a core competency within the aerosol business:
Microfluidics
The advances in ink-jet printing technologies achieved by applying microstructure
technologies have demonstrated new ways of handling fluids within micron-sized
(a)
(b)
Figure9.13 (ac) Design studies for Respimat.
(c)
Figure9.13 (Continued)
structures. These have been used by many teams in research institutes and industrial
organizations aiming for innovative solutions in biomedical diagnostics.
Microstructures permit precise fluid handling of very small volumes (microli-
ters to picoliters) in a minimum available space. Sophisticated microfluidic designs
enable the integration of fluidic functions such as dosing, mixing, resuspension of
dried chemicals, triggering, and valve functions. In the micron-sized channels and
cavities, capillarity can be utilized as a simple and robust fluid propulsion mech-
anism. All this can be combined to build platforms (lab-on-a-chip) for complete
chemical reactions. Typical applications are:
(a)
(b)
Figure9.14 (ad) (See color insert following page 16.) Robotic system for mounting and
assembling Respimat.
(c)
(d)
Figure9.14 (Continued)
(a)
(b)
(c)
The key properties of the Lilliput diagnostic chip for clinical microbiology are:
(d)
Figure 9.17 (Continued)
Other examples of the successful developments of bio-chips are a DNA chip for
Exicon (Denmark) and several chips for home-care tests, which are currently in the
market introduction phase.
The demands in analytical instrumentation for high speed, low sample consump-
tion, and low cost can be met with the application of microstructure technology. A
typical example is the introduction of a micro-degasser for High-Performance-Liq-
uid-Chromatography (HPLC) by Agilent, which was developed and manufactured
by microParts. A large 18-inch box with a long tube system for degassing eluents for
HPLC is replaced by a micro-system consisting of an ultra-thin PTFE permeable
membrane supported by a micro-structured PEEK inlay of 1.2 million columns as
shown in Figures. 9.18 and 9.19. The advantages are not only smaller size and lower
cost but, even more importantly, a reduction of the processing time for degassing
the samples under investigation from 4 hours to 15 minutes. Patents for the product
design are owned by Agilent, whereas the production processes are protected and
owned by microParts.
Another microstructure product that is very well suited for analytical instrumenta-
tion is an optical microspectrometer, which is described in the following paragraph.
Microspectrometer
An optical microspectrometer was one of many product ideas that was investigated
by the inventors of the LIGA-technique in 1987:
0.2 mm
Technology
As described in the first chapters, microParts was founded with the mission to com-
mercialize the newly invented LIGA-technology. Therefore, in the early phase, all
Figure9.21 BiliChek.
Figure9.22 IdentaColor.
Microstructuring Techniques
Series Production
Surface Modification
Assembly/System Integration
efforts were taken to validate the numerous process steps and to transfer the tech-
nology from a laboratory scale to industrial mass production. With the small series
production of demonstrator samples, it became already obvious that the production
processes required special adaptation and optimization for each individual product,
and since a product is assembled from different components, it typically requires the
application of a broad spectrum of different microtechnologies.
The basic idea of the LIGA-invention is the production of a master using
sophisticated microtechnologies and reproducing from this master in large
quantities utilizing injection molding. This principle was followed, and the origi-
nal master-fabrication by deep x-ray synchrotron lithography was augmented by
other microstructure processes (as shown in Figure. 9.23) such as x-ray lithography,
UV-photolithography, silicon dry etching, electro-discharge micromachining, and
Figure9.24 (See color insert following page 16.) Respimat production line.
Intellectual Property
The value of a high-tech company strongly depends on its intellectual property. A
strong patent portfolio serves two main objectives:
At the beginning of all business activities, a careful search must ensure the
freedom to operate. This means there are no patents, which could prohibit the
new enterprise to act in its field of competence and to execute its business plan. In a
pioneering industry like microsystems technologies, broadly claimed patents are an
important step in staking territorial claims.
Once microParts had defined its core business, an active patent strategy was
implied to secure this territory with patents. There are three categories of patents for
microParts business:
Production processes
Design elements for -fluidics and -optics, which can be combined for
innovative products (see Figure9.25)
Product patents
Cardiac LabCD96
Marker
Chip
Mikrospektrometer
Filing a patent is an efficient way to find out if an invention has a pioneer charac-
ter (no other publication found in patent search) or if it infringes on previously issued
claims. Filing of a worldwide patent incurs a substantial investment in finance and
workload. Therefore, microParts reviewed the possible implications of every new
patent application on microParts business:
microParts has issued approximately 30 patents and has many new inventions
under consideration. When the broad search phase was finished as described, pat-
ent activities were focused, and patents not related to the core business were sold,
generating a good income.
A strong patent portfolio not only serves to secure the companys business, it is
also important to obtaining good profit margins. microParts development and deliv-
ery contracts typically include a license agreement for using intellectual property. In
general, the customer receives exclusive rights in his application, which have to be
defined and very carefully described in the contract.
In order to pursue all relevant aspects of patent issues, an interdisciplinary team
was established that made the necessary decisions during regular twice-monthly
meetings. Throughout the lifespan of microParts, there have been no claims or dis-
cussions with regard to patent infringement.
222
microParts will mit der derzeitigen Fokussierung der Aktivitten so schnell wie mglich
die Produkt- und die Marktphase erreichen
100
Umsatz
Kosten
50
2000 2004
0
Vergangenheit Gegenwart Mittelfristige Zukunft 2000 2004
19901992 19931994 19951998 Langfristige Zukunft
ab 1998
50.0
Turnover (MIO ) 45.5
EbiT (MIO )
40.0 37.1
35.9
30.0
26.0
19.8
20.0
14.5
12.4
11.0
10.0 8.6
4.7
1.8 2.6
0.4 0.7 0.9
0.0
0.2 0.4 0.2 0.4 0.4 0.8 1.6 3.3 2.5
2.0
4.6
6.3 6.6 7.1 6.4
10.0
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
per annum. The city of Dortmund made a substantial investment in the technical
buildings rented by microParts.
Different from conventional businesses, the largest part of the budget (approxi-
mately 70%) was personnel costs. This reflects again the importance of excellent
human resources management.
program was contracted to the specialized consultant group Impuls, Ltd., Bonn. The
program offered practice-oriented training with subsequent individual coaching and
regular counselling to review the leadership skills of individuals.
Together with the consultants, a team of microParts personnel from all levels of man-
agement developed the following nine dimensions of individual leadership principles:
Marketing
Product development
Production processes development
Administration
600
Actual value Planning 553
514
500 471
401
400
340
305
300 284
251
195
200
148 159
100
0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Conclusion
The business development of microParts demonstrates the chances and risks of a
start-up business that is based upon an innovative technology requiring the determi-
nation of new applications and products.
The transfer of the newly invented microtechnology from the laboratory scale
to an industrial platform took much longer and required much more financing than
was anticipated and promised to the investors by the scientists. The new features of
the LIGA-technology offered improvements to existing products like ink-jet heads
and opened up the possibilities for completely new applications such as noninvasive
biomedical diagnostics.
In all cases, in order to win the business of prospective customers, there had to
be the potential to realize a functional improvement in their devices as well as a cost
saving. Whereas microtechnology could demonstrate the feasibility of a new product
idea that could be realized at low cost, the development of tools and processes for
low-cost mass production required a much larger effort on behalf of microParts and
a strong financial commitment of the customer.
Since components with micron-sized structures offer value only when mounted
into a functioning system that is usable in the macro world, processes and equipment
for mounting and assembling have to be developed for every single microproduct, a
factor that is underestimated by many newcomers to the field.
The introduction of an innovation or even a disruptive technology requires leader-
ship skills that typically exist only in small- and medium-sized enterprises, whereas,
on the other hand, in many cases, large-scale financing is critical to success. To
General Management
Production
Quality Management
Contents
Introduction............................................................................................................. 229
From the Past to the Future......................................................................... 229
The Future of Health and Medicine....................................................................... 232
Nanomedicine.............................................................................................. 233
Current Developments................................................................................. 234
Future Developments................................................................................... 235
Stem Cells for the Future14.......................................................................... 236
Materials Products Applications................................................................... 236
Nanoparticles, Nanomaterials, and Nanomanufacturing............................ 236
Carbon Nanotube Composites..................................................................... 238
Microchips and Nanoelectronics................................................................. 239
Biochips.......................................................................................................240
Supplier Companies.....................................................................................240
Existing MNT Products and Components.............................................................. 241
Emerging New Products and Systems.................................................................... 242
Nano Food Products.................................................................................... 243
Smart Packaging for Food...........................................................................244
Fuel and Transportation Systems................................................................ 245
Detection and Analysis................................................................................246
2030 and Beyond.................................................................................................... 247
References............................................................................................................... 251
Introduction
From the Past to the Future
The nineteenth century heralded the first industrial revolution based on steam power.
It created a manufacturing industry that provided new wealth and social change.
The twentieth century was the age of scientific discovery: electrical power replaced
steam; and new disciplines such as electronic engineering, nuclear physics, genom-
ics, and computer technology were born. The atom was split, nuclear power became
a reality, transistors and microchips were developed, computers were built, and the
DNA molecule was decoded, leading to the map of the human genome. Governments
229
funded research, and the stock of human knowledge rapidly exceeded the ability to
exploit it. At the dawn of the twenty-first century, the World Wide Web (the Internet)
came into common use for the communication and exchange of information. The
twenty-first century is the age of knowledge and communication; intellectual capital
is its currency. Now in the first decade of the new century, we look out onto an ocean
of unparalleled opportunities when, for the first time, we can begin to see how to
manipulate matter at the molecular level. The capability of manipulating atoms and
molecules was first hypothesized by Richard Feynman and others in the late 1950s.
In his lecture to the American Physical Society, Theres Plenty of Room at the Bot-
tom,1 in 1959, American Nobelist Richard P. Feynman presented his audience with
a vision of what could be done with extreme miniaturization. He proved simply that
the entire 24 volumes of the Encyclopdia Britannica could be written digitally
on the head of a pin. That well-quoted statement started people thinking about how
nanoscale science could become nanotechnology.
In his books Engines of Creation,2 first published in 1986, and Nanosystems:
Molecular Machinery, Manufacturing, and Computation,3 published in 1992, Eric
Drexler examined the enormous implications of developments in nanotechnology for
medicine, the economy, and the environment and made astounding yet well-founded
projections for the future. We are now able to understand the possible realities of
those predictions.
Zyvex, one of the first U.S. nanomanufacturing companies (see Chapter 8), has
developed Atomically Precise Manufacturing (APM) to make the tools to manufac-
ture objects potentially very large objects with atomic precision. Using chem-
istry and advanced engineering, this technique will enable advanced materials with
unique properties to be made and used in the manufacture of many new products.
For example, low-cost, lightweight golf clubs, baseball bats, and tennis rackets have
been manufactured with increased strength using carbon nanotubes.
The next leap forward may not be from scientific or technological breakthroughs
but from unifying science and the convergence of technologies. Success in achieving
this will initiate a new renaissance in manufacturing. This has already started with
many new products becoming available in sectors such as communications, textiles,
and medicine. The establishment of high bandwidth carrier technology means that
voice, data, picture, and other interactive multimedia can be transported together
over fiber-optic cables or satellites. This is an example of an innovation that has
advanced communications technology. The satellite helps facilitate communication
irrespective of geographic location. Any person can communicate with anyone at
any time, anywhere on earth, if the right equipment is available. The economic and
social power of mobile telephones and personal handheld computers is already hav-
ing an impact on the way people live and work.
Converging information technologies with computer technologies, the Inter-
net being an example, has already brought benefits that were not conceived of two
decades ago. Communication media are combined into one service and available on
a computer screen. At the touch of a key, people and companies can trade goods and
services. It brings buyers and sellers together, allowing the rapid transfer of informa-
tion and finance. This can be carried out at any time and at any place convenient to
the user. Google, the most used software search engine, is replacing reference librar-
ies to give users almost instant access to unlimited information.
The convergence of nanoscience and nanotechnology; biotechnology, biomedi-
cine, and genetics; information technology, computing, and communications; and
cognitive science and neuroscience will facilitate advances in science and technol-
ogy, improve human abilities, and enhance human performance. The synergistic
combination of these sciences and technologies is referred to as NBIC.4
Geographic boundaries are no longer barriers to communication. Nations are
coming together into regional groups, creating the global village concept. The
technological and economic developments that took place in the latter part of the
twentieth century and led to the concept of the global economy are now a reality.
This will inevitably lead toward a globalized society and eventually political con-
vergence. If this can be achieved, then most of the worlds current problems would
be solvable.
The future destiny of nations, governments, companies, and individuals is inex-
tricably linked to decisions made today. Such decisions have to be based on available
information and a reliable prediction of the future. An accurate prediction of the
future enables governments to produce economic strategies and policies, companies
to make meaningful business plans, and individuals to plan their lives. Sometimes
roadmaps or foresight documents are available to forecast trends in technological
development, economic progress, and market intelligence. Predictions based on
extrapolation from current trends can be made with a high degree of accuracy, but
the rapid pace of innovation makes long-term forecasting beyond 25 years much
more difficult. As can be seen from the earlier chapters in this book, disruptive
technologies can produce discontinuous innovations that lead to unexpected changes
and new areas of development. Any futurist must consider such possibilities when
predicting the future.
Predicting the future has become a business. Governments and companies often
have their own foresight programs and think-tanks with specialist staff to advise
on future developments and trends. A number of specialist companies and institutes
have been set up to trade advice, carry out vision surveys, and write reports on
areas of topical interest. Their names can be found by searching the Internet. Some
examples of the more prominent ones are listed later.
Ian Pearson, a futurist at British Telecoms Research labs, in his book Business
2010: Mapping the New Commerical Landscape5 states that within a generation, we
will grow computers from biological cultures that are faster than those we use today.
The ability one day to make conscious computers with an intelligence that
exceeds humans will provide a challenge to our present society. The development and
consequences of artificial intelligence were explored by futurist Ray Kurzweil in his
book The Age of Spiritual Machines.6 This was followed by The Singularity is Near,7
which explores the evolution of the union of humans and intelligent machines.
In his book The Extreme Future,8 James Canton, who runs the Institute for Global
Futures in the U.S., gives a compelling extrapolation from our current knowledge to
the next 40 years. He outlines eight fundamental innovations that will shape the future
taken from an American perspective: biomimetrics, photonics, nano-biotech, targeted
genomics, bio-detection, neuro-devices, nano-energy, and quantum encryption.
informed choices about their own healthcare. It is predicted that before 2030 this
will become an accepted practice, making healthcare fully personalized.
In the next decade, medical practitioners and health specialists will have enough
data on genetics and proteomics from patient records to replace diagnostics with
prognostic systems. The mapping of an individuals DNA and linking that knowl-
edge to his or her health profile will determine vulnerability to a wide range of
diseases. This will advance predictive medicine and will enable drugs to be targeted
to an individuals specific needs. Wearable computers will record and analyze data
from body monitors containing biomarkers that track disease in people at risk. These
computers can be securely connected to health monitoring centers. In this way, the
human population would contribute data directly to a central database for storage
and analysis. Clinical diagnosis can then be validated by accessing a central library
of biomarkers, thus identifying disease at its early onset.
The continuing development of imaging systems permits visualization of internal
organs and body processes, including brain functions. Within the next two decades,
this will advance our understanding of the relationship between body and mind and
lead to a predict and prevent approach to medicine. Eventually these health mea-
sures will result in life extension. Antioxidant and hormone replacement therapies
will further aid reduction of the aging process. Future markets will be shaped by
anti-ageing and health-enhancement products. Longevity medicine will become an
established practice.
It is estimated that within the next two decades human life expectancy for
healthy people could approach 100 years. Longevity medicine will retard the
aging process and promote better health and quality of life; but it will have pro-
found political, economic, and cultural consequences for society. Here we can see
how.bio-nanotechnology.through.advances.in.medicine.and.medical.practice.will.
change society beyond anything that has gone before. This leads us to the field
ofnanomedicine.
Nanomedicine
Biomedicine and biology are currently undergoing an information revolution. Huge
amounts of data are being generated from DNA sequencing, molecular structures,
and macromolecular structures (proteins, RNA, DNA); and from modelling and
visualizing biological pathways (metabolic, signalling, genetic control).
Nanomedicine is a subset of biomedicine. It can be loosely defined as the pres-
ervation and improvement of human health using molecular tools and knowledge
of the human bodys biochemistry. Nano-sized tools are used for the diagnosis,
prevention, and treatment of disease. They help to gain increased understanding of
the complex underlying physiology of disease. Nanomedicine will shape the future
direction of medicine. For a complete coverage of the subject, the reader is referred
to Robert Freitass excellent Nanomedicine Book Site.11 On this site, which is exclu-
sively devoted to nanomedicine, can be found four volumes of information covering
all aspects of the field. Each volume is available as a hardback book.
With the authors permission, I have taken the following definition from the
Nanomedicine Book Web Site.
In 2005, the European Science Foundation produced a report looking at the future
of nanomedicine12 and identifying Europes strengths and weaknesses. The work for
this foresight study report was carried out by a group of 35 experts from academia
and industry at workshops held in Amsterdam in 2004. One of the main conclusions
was the urgent need to raise awareness and improve communication of the economic
and social benefits of nanomedicine to stakeholders and to the wider public.
Current Developments
According to the findings of the IFAF 2029 Project,10 work is in progress in the fol-
lowing six areas as outlined on the Web Site. These will provide the foundations for
the future of nanomedicine.
sizes and accelerating the chemical reaction process. Devices could pro-
mote early detection and diagnosis of disease. Research is in progress using
nanoscale devices and materials to learn more about how biological sys-
tems self-assemble, self-regulate, and self-destroy at the molecular level.
Wyeth and Merck, Pfizer, GSK, Astra Zeneca, and Genentech are using
nanotechnologies for drug formulation and drug screening, employing the
technique of quantum dot analysis.13
Molecular Imaging Systems: Advances in nanomedicine will depend on
developments in molecular imaging systems. Molecular imaging is the non-
invasive visualization in space and time of normal as well as abnormal cellu-
lar processes at a molecular or genetic level of function. It is used to provide
characterization and measurement of biological processes in humans (invivo).
Current noninvasive imaging developments fall into three categories:
Radionuclide Imaging Devices visualize very low concentrations of
radionuclide probes in real time and provide quantitative information but
with low image resolution. They can be used for whole body imaging.
The PET (Positron Emission Tomography) scan visualizes probes
labelled with positron emitting radioisotopes; it is increasingly pop-
ular for both research and clinical medicine. It can reveal the pres-
ence of lymphoma cancer cells in specific areas of the body earlier
and more accurately than previous diagnostic methods.
The SPECT (Single Photon Emission Computed Tomography) uses
probes labelled with radioactive isotopes, which emit gamma rays
detected by a gamma camera to create the scan.
Quantitative Autoradiography is a technique used in the laboratory
to visualize radioactively labelled molecules in substances.
Radionucleotide Imaging combined with a computed tomography
(CT) or a nuclear resonance imaging (NRI) scan provides high ana-
tomic definition along with functional imaging for precise location
of the selected molecular activity.
Magnetic Resonance Imaging (MRI) uses paramagnetic-labelled probes
and produces high imaging resolution, but a large concentration of the probe
must be given, which can overwhelm the system being investigated.
Optical Imaging uses fluorescent and bioluminescent probes that emit
radiation in the visible or near-infrared wavelengths, which can be
scanned by optical cameras. Since light can travel only a few milli-
meters through tissue, it is limited to skin, breast, small animals, and
endoscopic procedures not deep tissues.
Future Developments
In the future, scanners will become so small and inexpensive that they could be used
directly by people in their own homes. They will be able to illuminate a large number
of biomarkers that identify disease processes. Beyond disease, some experts see that
molecular imaging could prove even more important for revealing healthy biologi-
cal processes as well. Brain scans already show neurological changes that energize
areas of the brain associated with human emotions. Molecular markers can be used
to highlight other parameters such as stress levels, immune function, balance, and
energy flow. Molecular imaging will become more important as genomics and pro-
teomics expand the number of relevant molecules to visualize human behavior.
where nanoparticles are chemically locked into the material. Nanoparticles already
exist in the environment as products of combustion. They are small enough to pass
directly into the body through the skin and the cell walls, being less than 100 nm
wide, less than the size of a virus. This is of particular concern to manufacturers
of nutraceuticals who use them as food supplements. It is claimed they will enter
directly into tissues and cells. Other examples of food products that carry a nanopar-
ticle label are nano-tea that is claimed to increase the amount of selenium that can be
absorbed from green tea through capsules that bypass the stomach and enter the lower
gut directly, and cooking oil that will stop cholesterol entering the blood stream. In
the U.S., there are more than 30 food products listed with nanoparticle ingredients.
The effect of nanoparticles on health is a subject of study in many countries.
Much of the fear is engendered by the known toxicological effects of asbestos.
This is a naturally occurring nanoscale material extensively used in the twentieth
century because it was a cheap building material. Its use was banned in Europe in
1998. The danger came from dust liberated during manufacture, resulting in many
deaths from lung cancer. This was largely due to ignorance about the structure and
nature of the material at a time when coal was also burnt on fires. The smoke from
these produced even worse pollution and deaths from respiratory diseases. Carbon
nanotubes resemble asbestos in structure, but little is known about whether they con-
stitute a similar health hazard. Therefore, there is an understandable public concern
about new materials of which little was known. Some similarities in the structure of
asbestos fibers to carbon nanotubes have been noted by the public.
In 2004 the U.K. government set up an expert committee to review the toxicology
and other safety issues associated with nanotechnology and after extensive consulta-
tions with people from industry and academia produced a comprehensive report.16
The report concluded that the very small quantities of nanoparticles being manu-
factured in uncontrolled environments compared with the natural release of such
particles did not constitute a serious risk to health. Humans inhale millions of pol-
lutant nanoparticles per breath produced as products of combustion. Nanoparticles
of chemicals like titanium dioxide, used in cosmetics and sunscreens, show no evi-
dence of harm to the skin or the organs beneath it. In fact, their enhanced protective
properties have proved to be very beneficial to health and may substantially reduce
skin cancers by reducing exposure to harmful solar ultraviolet radiation. The need
for more toxicological research on nanoparticles was emphasized in the report. This
report has helped to reestablish public confidence and give manufacturers guidance
on what measures should be taken in nanomanufacturing. The public concern about
nanomanufactured products and the health issues associated with genetically modi-
fied organisms resulted from a lack of knowledge, misunderstanding, and misinfor-
mation put out by the media. However, the scientific community must share some of
the responsibility for not explaining the issues in an understandable way to the lay
public. The need for better public understanding was also highlighted in the report.
Nanomanufacturing based on nanoparticulate technology has created improve-
ments to many existing products. These include improved cosmetics, stain-resistant
fabrics, composite materials for vehicles and sports equipment, medical devices and
diagnostics, drug delivery systems, and fire and water resistant coatings and materi-
als for fuel cells. These products and others are currently being developed and in
some cases are already on the market. In the foreseeable future, there is the promise
of many more products. It is only when such products can be purchased by the public
in high street shops at affordable prices that the full commercial cycle is complete.
There are five widely known methods to produce nanomaterials:
Sol-gel synthesis
Inert gas condensation
Mechanical alloying or high-energy ball milling
Plasma synthesis
Electrodeposition
New products that will use these chips are already at the design stage. For example,
a new handheld computer with integrated wireless connectivity that will have more
computing power than current desktop models could be on the market within a few
years. The manufacturers claim that they will be able to run all day on battery power.
The complete transition to nanotechnology techniques could occur by 2015,
when chip makers will have exhausted their ability to shrink further the wires and
switches that make up the modern processors and memory storage devices, central
to computers, communications, and consumer electronics. Manufacturers are look-
ing to the future when they can make electronic switches from single molecules.
Molecular electronics is an emerging field that will soon be out of the laboratory and
into manufacturing. The development of miniaturized scanning tunneling micro-
scopes (STMs) and atomic force microscopes (AFM) that facilitate the manipulation
of single molecules has brought the realization of constructing bottom-up structures.
Initial products in molecular electronics will be hybrid silicon-molecular devices.
Combined with nanotubes, the possibilities of making very sensitive biological and
chemical sensors for use in medical diagnostics and environmental monitoring are
unlimited. Chemists at Liverpool University in the U.K. recently reported success
in forming a bond between a gold atom and a single organic molecule called a Pen-
tacine.23 This bond between a metal atom and an organic molecule is a step toward
connecting electronic components to organic molecules, essential for progressing
molecular electronics.
Biochips
The big development within the next decade will be smart biochips, i.e., molecular-
scale devices with intelligent multifunctionality. A biochip is a collection of min-
iaturized test sites (microarrays) arranged on a solid substrate that permits many
tests to be performed in parallel in order to achieve faster and higher throughput.
Typically, a biochips surface area is about the size of a key on a computer keyboard.
Biochips will revolutionize medicine in the same way that microchips revolutionized
electronic devices.
A biochip can perform thousands of biological reactions, such as decoding
genes, in a few seconds. It enabled the rapid identification of the estimated 80,000
genes in human DNA. One important application area is in the detection of biomol-
ecules in samples, thus allowing inexpensive rapid detection of toxins and viruses
such as avian flu. Pharma companies are particularly interested in using biochips
and microfluidic devices to screen tissues for genetic differences so that they can
design genetically targeted drugs. This will greatly improve treatment and reduce
drug costs by removing the try and see if it works principle that dominates current
practice. Targeted drug delivery will be the future.
Supplier Companies
Biochips are complex devices requiring many different technologies for their con-
struction. The first commercial biochips were introduced by the U.S. company
Affymetrix,24 the worlds leading manufacturer of DNA microarrays, in 1994. Since
then, Affymetrix GeneChip (R) technology has become the industry standard in
molecular biology research and is pointing the way to the future.
The German company Siemens is planning to use the laboratory on a chip
concept in a smart card similar to conventional check cards. The aim is to provide
a low-cost, easy-to-use general-purpose, mass-market analytical product similar to
existing smart cards. These could be used in doctors surgeries and clinical laborato-
ries. The card would be inserted into a desktop or laptop computer where data would
be analysed and a readout of results provided. This instant analysis will reduce
patient waiting times and reduce the burdens on hospital laboratories.
In a similar way to Siemens, the company Infineon is also working on a system
to incorporate electronic DNA biochips in powerful desktop devices for diagnostics
applications. This will enable complex DNA analyses to be carried out in medical
practices, hospitals, and other medical institutions faster and more cost effectively than
can be done at present. Impressive work is in progress at many research centers around
the world. For example, the Optical Biochip Project at Cardiff University25 aims to
develop more sophisticated analytical methodologies that will increase the success
rate of drug discovery, in genomics research, in the routine diagnosis of disease.
These companies and institutes are pioneering the future direction of analytical
diagnostics, which eventually will have a beneficial effect on our lives. Biochips that
can perform the basic bio-analysis functions (genomic, proteomic, biosimulation,
and microfluidics) at a low cost will transform biological analysis and production in
a very similar fashion as the microprocessor did for data.
Implanted biochips and microchips can be used for a variety of applications,
including identification and tracking of individuals and continuous monitoring of
body functions and behaviour. This subject has been featured in many science fiction
books and films and has become very controversial. A number of people working in
the field have tested the viability of such implants in their bodies.
On 24 August 1998, Professor Kevin Warwick,26 director of cybernetics at the
University of Reading in the U.K., became the first human to have a microchip
implanted in his body. During a 20-min medical procedure described as a routine
silicon-chip implant by Dr. George Boulos, who led the operation, doctors inserted
into Warwicks arm a glass capsule not much bigger than a pearl. The capsule held
several microprocessors that were able to transmit to the outside world. He was able
to demonstrate the ease of the operation and its potential value in medical applica-
tions, particularly for paraplegics where embedded chips could be used to control
motor-drive systems to move limbs. The implant was removed from his arm after
nine days without any problems. In response, Charles Ostman, a senior fellow at
the Institute for Global Futures, says that Neuroprosthetics are inevitable and that
biochip implants may eventually become part of a routine medical procedure.
There is still much work to be done, but the possibilities are unlimited.
contains data stored on the chip, typically an ID number. With the help of RFID
readers in our cell phones, in supermarket freezers and check-outs, in our private
refrigerators, etc., we will be able to retrieve information about a particular item
based on its ID number.
RFID is not a new technology, but advances in micro-nanotechnology will
empower the consumer over the product supplier, thus improving safety and reliabil-
ity. We have entered the age of biohazards that could come from the natural spread
of disease through contaminated food or induced by bioterrorism. Smart tagging
will provide a greater protection to consumers. Smart packaging is estimated to be a
$100 billion plus business in the United States. More people work in packaging and
packaging operations than any other business area in that country. Although exact
figures are not available, it must be an important growth area worldwide.
modelled. Like all disruptive technologies, expected paths and directions can be
instantaneously changed. The current concern about global warming and how sci-
ence might deal with it has spurned many innovative ideas and extreme solutions;
and even created the foundation for new industries.
It would have been difficult, if not impossible, for any futurist living in the
eighteenth or nineteenth centuries to have predicted life in the twenty-first century
because of the lack of available knowledge at those times. Today our knowledge is
increasing rapidly, although our ability to use it effectively lags behind. The Inter-
net has given free access to almost all knowledge. Eventually, search engines like
Google will supersede libraries as a place for seeking information.
Innovation is the driver of change and gives companies a competitive advan-
tage. Nations that develop an innovation-based economy will be winners, but their
governments have to create the right environment for it to flourish. This enevitably
means change, and people are generally averse to change and react to it naively, thus
slowing down technological advance and delaying the social and economic benefits
it could bring. This is reflected in government planning and decision making when a
cautionary approach is taken. Sometimes this is necessary, but it can produce a state
of unpreparedness when a dire threat emerges. For example, the threat of a bird flu
pandemic or a massive earthquake on an unprepared world could be disastrous. The
problems facing humans are therefore more associated with acceptance of social
change than technological change, although the latter produces the need for that
change. Nanotechnology has faced unfavorable reactions from people who are tradi-
tionally ignorant of the science and its opportunities. Education and greater aware-
ness is the key to the understanding and public acceptance of such technologies.
Earlier in the chapter, the future benefits of nanomedicine to healthcare were
outlined. A sensible balance between risk and benefit will always have to be made.
In the future, risks will be minimized by improved diagnostics and monitoring of
patients. The ability to manipulate and control the genetics of humans, animals, and
plants, the availability of new drugs to target disease, the growth and regeneration
of human organs from stems cells, the application of remotely controlled robotic
operators, continuous body monitoring with internal and external sensors, and the
complete understanding of the functions of the human brain are some of the develop-
ments that will be realized.
In 2030 most food production and its distribution to the consumer is likely to be
automated and not involve humans. Animal products will be treated differently from
vegetables and fruit owing to the methods of production. Battery farming and hot-
house products are already highly automated and involve less human intervention.
Arrays of sensors connected to machines and computers will continuously moni-
tor and check all parts of the production process to ensure that quality is maintained.
At the retail end of the chain, shops will become distribution centers, allowing
customers to freely choose and take what they need without going through time-
consuming checkouts. Individuals and the products will be identified and monitored
with payment being automatically debited from their online accounts. This will not
necessarily prevent or change some forms of shopping where people like to browse,
but it will alter the nature of traditional shopping.
room temperature? Most of the chemical compounds used so far only superconduct
at liquid gas temperatures, which limits their use owing to the practicalities and
economics of employing cryogenic systems. Molecular superconductors, including
carbon nanotubes, are being studied, but at present they also only work at cryogenic
temperatures. This single development would revolutionize transportation. Instead
of highways filled with cars, silent, levitated hover-trains would glide around cities,
and electrically driven personal carriers and walkways would transport people and
goods economically anywhere. It would alter the design and landscape of cities and
communities, making them look more like how science fiction has always portrayed
the future.
Similarly, aerospace will benefit from new discoveries as new propulsion systems
and materials are developed. Nanotechnology will have to be used in the develop-
ment of materials for body and engine parts and for fuels. NASA, the U.S. National
Aeronautics and Space Administration, is currently developing a reusable replace-
ment for the Space Shuttle. By 2030 this new space vehicle would have been in
operation for some years, along with other commercial designs. A new type of space
station will probably be in orbit to accommodate both scientific personnel and tour-
ists. This station will also be needed to construct new space vehicles for deeper space
exploration as the existing International Space Station (ISS) is not suitable for this
purpose. Space exploration and space tourism will become a commercial business.
An example where science fiction could become a reality is in the construction
of a space elevator. A space elevator is essentially a long cable or tower extending
from the Earths surface into space with its center of mass at geostationary Earth
orbit (GEO), at an altitude of 35,000 km directly above the equator. Electromagnetic
vehicles travelling along the cable could serve as a mass transportation system for
moving people, payloads, and power between Earth and space. This concept was
highlighted by Arthur C. Clark in 1978 in his book The Fountains of Paradise.32
At the time, this idea was dismissed as there was no technology available that
could make the engineering possible. Now in the twenty-first century, developments
in nanomaterials, like carbon nanotubes, increase the possibility of making such a
project a reality. Robert Cassanova, director of the NASA Institute for Advanced
Concepts, stated that its scientifically sound and technically feasible.32 A concep-
tual design has been done by NASA, which is now seriously considering space eleva-
tors as a mass-transit system in the late twenty-first century or before. It will be a
major international undertaking, perhaps surpassing anything that has gone before.
Developments in aerospace will make Space Planes a reality; they will be able
to take people to the space station or fly around the Earth in hours rather than days.
If, as is planned by 2020, a permanent base on the moon is established, then later,
maybe by 2030, travel to Mars could become a reality. Space projects such as these
will advance all types of transportation systems, and a giant leap forward will be
made, fulfilling many human desires and aspirations.
Kurzwell6-7 believes that within the next 50 years humans and computers will
combine to produce superintelligent entities. These machine-enhanced humans could
be a million times more intelligent and operate a million times faster than we can
today, so the unimaginable could be achieved. Alternatively, the rate of development
of computer technology will produce interacting robots with high levels of artificial
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2. Drexler, E., Engines of Creation, Anchor Books, New York, 1986 and website: www.
e-drexler.com.
3. Drexler, E., Nanosystems: Molecular Machinery, Manufacturing, and Computation,
John Wiley & Sons, 1992,
4. Bainbridge, W.S. and Roco, M.C., Reality of Rapid Convergence, Annals of the New
York Academy of Sciences 1093 (1), ixxiv, 2006.
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Terms
Microtechnology: Technology dealing with matter on the size scale of microns
(1 millionth of a meter). Microtechnology is a broad term and can refer to
microelectronics, MEMS, or any technology that manipulates matter on
a micron scale.
Micro Electro Mechanical System (MEMS): Term primarily used in the
United States for a micro-sized device with both electrical and mechani-
cal functionality.
Microsystem: A microscale device that combines some of the following func-
tions: mechanical, optical, chemical, thermal, magnetic, biological, and
fluidic, generally integrated with electronics. A microsystem is a pack-
aged assembly where all the connections are in place to interface with the
macro world and is usable by the consumer.
MicroSystem Technology (MST): The term MST is preferred in Europe and
Japan in place of MEMS as it is the methods and techniques used to fab-
ricate microsystems.
Micromachines: Mechanical devices with microscopic dimensions. This term
is preferred in Japan and is used interchangeably with MEMS and MST.
Micropackaging: The processes used to make the connections/interconnec-
tions, encapsulate, and protect the MEMS/micro device or nano device or
subsystem so that it is ready to be microassembled into a product usable
in the macro world.
Micromanufacturing: The production of microsystems products using micro-
fabrication, packaging, microassembly, and other technologies associated
with microelectronics and microsystems.
Microelectronics: This technology includes techniques used to manufacture
ICs, discrete microelectronic devices, MEMS devices such as sensors and
actuators, and various electro-optic devices.
Micro Electro-Optical Mechanical Systems: MEMS devices that have appli-
cations in optical telecommunications. Also known as optical MEMS.
Microfluidics: The science of designing, manufacturing, and formulating devices
and processes that deal with nanoliter or picoliter volumes of fluids (i.e.,
10 -9 or 10 -12 liters). Microfluidic studies include nozzles, pumps, reser-
voirs, mixers, valves, etc., that can be used for a variety of applications,
253
Carbon Nanotubes: Tiny tubes about 10,000 times thinner than a human hair
and consisting of rolled up sheets of carbon hexagons.
Charge-Coupled Device: A device utilizing a technique in which information is
stored and transported by means of packets of minute electrical charges.
Chemical Vapor Deposition: The growth of thin solid films on a substrate as
the result of thermochemical vapor-phase reactions.
Creative Destruction: Creative destruction occurs in an industry when a new
technology or product paradigm replaces the old. The industry becomes
redefined and uses a new technology trajectory. This has occurred in
microsystems when MEMS-based accelerometers eclipsed the mini-elec-
tro-mechanical systems developed for airbag exploders in passenger cars.
Deoxyribonueleic acid: A nucleic acid that carries genetic information in the cell.
DNA consists of two long chains of nucleotides warped into a double helix
and coupled by hydrogen bonds. The sequence of nucleotides in the DNA
determines individual hereditary characteristics. DNA is responsible for
all protein synthesis and handling of genetic information in living beings.
Design Rules: Rules for design of a device, established by repeated part fab-
rication, or materials testing, and includes minimum feature widths,
minimum feature spacing, feature overlap dimensions, etch release hole
spacing, material characteristics, etc.
Design For Manufacturability: Statistical information on manufacturing pro-
cess characteristics used to ensure that the device design falls within the
parameters of normal manufacturing variances for each process element.
Discontinuous Innovation: Fundamental and far-reaching product changes that
require the users or producers to change.
Disruptive Technology: Those technologies that have redefined the technology/
product paradigm in an existing application area and have created the
basis for a new industry.
Deep Reactive Ion Etching: An etching technique that uses plasma to obtain
high-aspect-ratio structures or deep features.
Reactive Ion Etching: Dry etching by plasma having chemically active gas ions.
Fab: The informal name for a chip manufacturers fabrication plant where ICs or
MEMS devices are made. SEMICON industry term for a foundry.
Finite-Element Analysis: A simulation procedure for analyzing multiphys-
ics behavior.
Smart Sensor: The electronics associated with a sensor that processes the out-
put and are partially or completely integrated on a single chip.
Fuzzy Logic: A method to mathematically represent uncertainty and ambiguity
and provide formalized tools to deal with data whose boundaries are not
sharply defined (i.e., are fuzzy). Some PalmTops use fuzzy logic to recog-
nize handwriting.
High Aspect Ratio Micromachining: Micromachining techniques for manu-
facturing microstructures of aspect ratios.
Moores Law: The number of transistors the industry would be able to place on
an IC chip would double every 18 months. The IC industry has been able
to keep pace with this law to date and strives to achieve the same in the
future. Named after the cofounder of Intel, Gordon Moore.
Technology/Product Paradigm: The technology a company utilizes to form a
core product that acts as a platform from which many application-spe-
cific products can be developed. It is a matrix describing the relationship
between the various technologies and products of a company.
Acronyms
APM Atomically Precise Manufacturing
AFM Atomic Force Microscope
CCD Charge-Coupled Device
CCLRC Council for the Central Laboratory of the Research
Councils
CVC Chemical Vapour Deposition
CAD Computer aided design
CNID Centre for Nanoscience Innovation and Defence
CMOS Complimentary Metal Oxide Semiconductor
DFM Design For Manufacturability
DNA Deoxyribonueleic Acid
RAM Random Access Memory
DRAM Dynamic Random Access Memory
DRIE Deep Reactive Ion Etching
DFM Design for Manufacturing
RIE Reactive Ion Etching
GM Genetically Modified
EC European Commission
EU European Union
EPSRC Engineering and Physical Research Council
ESF European Science Foundation
FP European Framework Programme for Research and
Development
FEA Finite-Element Analysis
EBM Element Boundary Method
HARMST High Aspect Ratio MicroSystems Technology
ISS Intelligent Simulation Systems
IT Information Technology
IP Intellectual Property
ISO International Organization for Standardization
LIGA A German acronym for Lithographie, Galvanoformung,
Abformung Lithography, Electroforming Micromolding
PC Personal Computer
NASA National Aeronautics and Space Administration
GB Giga byte
NPL National Physical Laboratory
NSF National Science Foundation
DARPA Defence Advanced Research Projects Agency
DTI U.K. Dept. of Trade and Industry
INEX Nanotechnology Exploitation
IVAM European Microtechnology Network
IBM International Business Machines
IEEE Institute of Electrical and Electronic Engineers
MNT Micro-nanotechnology
MANCEF Micro and Nanotechnology Commercialization Education
Foundation
MIG MEMS Industry Group
MOEMS Micro electro-optical mechanical systems
MMC Micromachine Center (Japan)
NEXUS Network of Excellence in Multifunctional Microsystems
NEMS Nano Electro-Mechanical Systems
NIST National Institute of Standards and the Technology
NBIC Nanoscience, Biotechnology, Information Technology and
Cognitive Science
NNI National Nanotechnology Initiative
NSET Nanoscale Science, Engineering, and Technology
PATENT-(DfMM) Design for Micro-Nano Manufacture
RAE Royal Academy of Engineering
RS Royal Society
SEMI Semiconductor Equipment and Materials International
SBIR Small Business Innovation Research Program
Relevant Websites
nanotechweb.org
www.mancef.org
www.mntnetwork.com
www.nanoforum.org
www.nano.org.uk
www.nanomat.com
www.purplegoldmedia.com
www.ournanoworld.com
www.nanowerk.com
www.nanomagnetics.com/
www.nano.gov
www.nanomedicine.com
www. physorg.com
http://nanoparticles.org/
www.imm.org
www.nano-net.org/
www.hkc.com/nanomarkets
www.patent-dfmm.org
www.nanophase.com/
www.nanofactory.com
www.quantum-pi.com
www.forbes.com
www.castleink.com
www.inex.org.uk/
www.semi.org/standards
www.ieee.org/standards
www.abbottpointofcare.com/istat/products/analzsers.htm
www.affymetrix.com/index.affx
www. science.nasa.gov/headlines
www.e-drexler.com
www.inex.org.uk
www.nano.washington.edu
www.enablingMNT.com
http://www.osha.gov
http://www.cdc.gov/niosh/
http://www.epa.gov
http://www.niehs.nih.gov
http://www.fda.gov
http://www.nano.gov/NNI_Strategic_Plan_2004.pdf
http://www.nnin.org
http://www.ncn.purdue.edu/
http://www.cpsc.gov
http://www.nanomanufacturing.eu
Search Engines
The following are useful search engines and sources of information for micro and
naotechnology. Apart from the free search engines and useful tools such as Google
scholar and Google Desktop, there are several more dedicated commercial services: