Nantero’s Nanotube Memory (NRAM) Is Finally Here
Back in 2003 when nanotechnology first came across the radar of technology investors, a number of companies helped fuel excitement in this sector with promises of nano enabled breakthroughs that would disrupt entire industries. One company that seemed to show great promise was Nantero, and their efforts to create a form of memory that used carbon nanotubes (NRAM). 12 years later, and we finally see Nantero emerge from stealth mode with an announcement last week that the NRAM process has already been installed in seven production CMOS fabs and is currently being designed into innovative new electronic products.
Founded in 2000, Massachusetts based Nantero is looking to deliver a carbon nanotube memory product (NRAM) that will replace all existing forms of memory, such as DRAM, SRAM and flash memory. Nantero has taken in a total of $73 million in funding so far with a Series E funding round of $31.5 million being announced just last week which is the largest investment to date. Among the list of investors in this substantially oversubscribed round was Draper Fisher Jurvetson, arguably one of the most successful venture capital firms ever. DFJ has participated in every single investment round for Nantero so far. Disclosed partnerships for the Company include On Semiconductor (NASDAQ:ON), Lockheed Martin (NYSE:LMT), and Schlumberger (NYSE:SLB). Undsclosed partnerships include 2 major infrastructure companies, 6 leading semiconductor companies, and multiple leading foundries. The Company has over 180 US patents issued to date with more than 200 patents pending.
In a recent report by Markets and Markets, the total market for next generation memory is expected to reach up to $3.7 billion by 2020, at an estimated CAGR of +38.25% from 2014 to 2020. NRAM is being marketed as a replacement for flash memory and DRAM. According to Technavio, the global flash market will grow at a CAGR of +10.1% from 2014-2019, to reach $49 billion by 2019. Some of the advantages of NRAM over these existing memory technologies can be seen below:
Nantero’s business model is to license their broad IP portfolio to major chip manufacturers, foundries, and electronics companies around the world so that they can create products enabled with NRAM.
TINY’s Investment in Nantero
One very indirect way for retail investors to invest in Nantero is through buying shares in Harris and Harris Group (NASDAQ:TINY). Nantero is their 8th largest investment valued at $3.64 million with a cost basis of $1.72 million. At current face value, this represents just 4% of TINY’s $90 million investment portfolio. With TINY trading just off their 52-week low, a successful exit from Nantero could provide a boost to the stock. DFJ wouldn’t be participating in this latest funding round if they didn’t see a viable liquidity event in the near future of either an IPO or an acquisition. For the sake of retail investors, let’s hope we see an IPO.
Are you paying too much in transaction fees to your broker? Check out a brokerage firm called Zacks Trade that's offering $1 trades on U.S. stocks and options for an entire year. After that, you'll pay just $3 a trade or a penny a share, whichever is greater. It's one of the cheapest brokers out there and we use them to trade stocks on over 90 foreign stock exchanges. Open an account today and get $1 trades for a year.