VC heats up

LONDON -- The venture capital market is beginning to heat up after a long dry spell. Who are the venture capitalists' betting on this time around? Two promising device startups, Nantero Inc. and NanoOpto Corp., are the latest companies to garner venture capital funding.

Nantero, a Woburn, Mass.-based start-up company looking to use nanometer-scale structures to create a nonvolatile RAM, said Monday (September 8, 2003) that it has received its second round of investment worth $10.5 million.

The new lead investor Charles River Ventures was joined by returning investors; Draper Fisher Jurvetson, Stata Venture Partners and Harris & Harris Group. The $10.5 million complements a $6 million first round announced in October 2001. Bruce Sachs and Bill Tai, both partners at Charles River Ventures, have joined Nantero's board of directors.

Earlier in 2003 Nantero announced it had developed the basis of a 10-Gbit memory, an array of more than 10 billion carbon nanotube "junctions" on a silicon wafer (see May 8 story). The company claims that its non-volatile memory is a candidate to replace all existing types of memory component including DRAM, SRAM and flash and that the prototype wafer was produced using only standard semiconductor manufacturing processes, maximizing compatibility with existing fabrication lines.

Nantero plans to go to market by offering to license its technology to enable manufacturers to produce, market, and sell NRAM(TM) for both standalone and embedded memory applications. This technology transfer package would include a process module and the associated process knowledge, intellectual property rights, and the necessary nanotube materials.

"Nantero has achieved impressive milestones over the last two years, especially in demonstrating compatibility of its manufacturing process with industry standards," said Sachs of Charles River Ventures in a statement.

Meanwhile, optical chip company NanoOpto, Somerset, N.J., said Tuesday (September 9, 2003) that it had raised $7 million in a round of venture financing, bringing the total financing raised to date to $27 million.

The latest round was contributed by existing equity partners Morgenthaler Ventures, Bessemer Venture Partners, Draper Fisher Jurvetson (DFJ) Gotham Ventures, Draper Fisher Jurvetson (DFJ) New England Ventures, U.S. Trust's Excelsior Venture Partners III LLC, and the Harris & Harris Group.

The company said it would use the money to continue technology and product commercialization and advance into the revenue stage.

The company announced the fabrication of its first wafers using "nano-manufacturing technology" for subwavelength optical element (SOE) devices in March 2002 (see March 4, 2002, story).

"We plan to use this new round of investment to build on the exciting customer traction already created through the introduction of new products and to ramp our operations," said Barry Weinbaum, president and chief executive officer of NanoOpto.

NanoOpto said it has commercialized its technology for optical data transfer, telecommunications, sensor and display applications.