World Graphene Summit emphasizes gap between graphene potential and availability of capital: points to nanotech bust
The first World Graphene Summit occurred in San Francisco, CA on September 15-16, 2014 which is aimed at helping stakeholders find the shortest distance between the staggering potential of graphene and its commercialization. In this mixed gathering of a hundred entrepreneurs and scientists, the availability of financial resources is emerging as a significant determinant shaping the arrival of graphene in the marketplace.
There is a need to develop new approaches to secure financial resources.
Keith Blakely, Founder & CEO, The InVentures Group, the USA has been following the graphene industry for the past decade. In his presentation at the World Graphene Summit he remarked that the ebullience of the late 1990s for nanotechnologies (nano-ebullience) might have been a unique opportunity that fails to support the current graphene industry. According to Mr Blakely, the ghosts of failed nanotech ventures hinder graphene entrepreneurs currently looking for funding. In 2001-2003 nanotech stocks deflated faster than a basketball under the weight of a cement truck, leaving investors licking their wounds and wondering why something so promising can cause such heartaches.
Graphene had nothing to do with the nanotech boom of the late 1990s but the appetite of institutional investors toward IPOs has migrated toward huge undertakings such as those of social medias. Investors are jaded for cause: two thirds of the venture capital firms in the USA are going out of business. Therefore, it is nearly impossible to raise public monies for a start up technology company in the public markets in the USA.
Offering a bright light of hope in the wilderness, Canadian Venture Exchange junior miners seem successful at raising capital for emerging graphene players as for example 3D Graphene Lab Inc. (TSX-V: GGG) and Lomiko Metals Inc. (TSX-V: LMR).
What is the impact of the lack of small IPOs for raising capital for graphene entrepreneurs?
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Professor Andrea C Ferrari of the Cambridge Graphene Center in the United Kingdom and Professor of Antonio H. Castro Neto of the National University of Singapore emphasized that the development cycle of emerging technologies is up to 40 years, which should be expected of graphene as well.
In the face of this long development cycle we may rely on large companies such as Samsung, Raytheon and IBM, which have the deep pocket means and the corporate patience to drive the graphene industry. Further these companies already own or partake in the distribution networks permitting them to develop new markets with little effort.
But Douglas W. Jamison of Harris and Harris Group, Inc. an investment firm in the biotech space advocates a creative approach for start-ups. He emphasizes that the successful graphene enterprises need to be creative in their financing strategy. One proven approach in the biotech space is to acquire enterprises already manufacturing products that graphene-improved products can then displace. In support of graphene commercialization he cited the acquisition of Braille Batteries Inc. by Grafoid Inc. as an example to follow: the acquisition of the batteries manufacturing and distribution network should permit Grafoid to gain market inroads without facing the usual skepticism that delay the commercialization of products.
Though the graphene industry has a bright future, it can’t party like it’s 1999 yet.
Dr. Luc C. Duchesne is a Speaker and Author with a PhD in Biochemistry. With three decades of scientific and business experience, he has published ... <Read more about Dr. Luc Duchesne>