Nanosys IPO Withdrawn
Interesting article from the good folks at Small Times magazine on valuation of nanocompanies. The article discusses the withdrawal of the Nanosys IPO and the difficulty in establishing an enterprise value for nanostarts stating:
“discounted cash-flow models and models focusing on earnings before interest and taxes, price-to-earnings, price-to-revenues, etc . . . . may be particularly difficult to forecast due to greater technical complexity and product uncertainty.”
Valuation of startup companies has always been difficult and required some (small) degree of faith on the part of the investor. Most of the folks who would otherwise be interested in investing in nanostarts are still recovering from the collapse in internet and telecom stocks.
Small Times touches on the value of intellectual property to the overall valuation of the nanostart:
“The scope of the intellectual property (IP) position: Does the company have a defensible portfolio of patents? Does it have the resources to defend its IP estate?”
The Nanosys portfolio seems a bit thin at this point with no issued patents and 11 published applications. It is of course possible that Nanosys has patent rights beyond what I have found through licenses or assignments that don’t show up on the PTO database.
Valuing a company on the basis of patent applications adds a level of uncertainty on top of the economic uncertainty discussed by the Small Times article.
“discounted cash-flow models and models focusing on earnings before interest and taxes, price-to-earnings, price-to-revenues, etc . . . . may be particularly difficult to forecast due to greater technical complexity and product uncertainty.”
Valuation of startup companies has always been difficult and required some (small) degree of faith on the part of the investor. Most of the folks who would otherwise be interested in investing in nanostarts are still recovering from the collapse in internet and telecom stocks.
Small Times touches on the value of intellectual property to the overall valuation of the nanostart:
“The scope of the intellectual property (IP) position: Does the company have a defensible portfolio of patents? Does it have the resources to defend its IP estate?”
The Nanosys portfolio seems a bit thin at this point with no issued patents and 11 published applications. It is of course possible that Nanosys has patent rights beyond what I have found through licenses or assignments that don’t show up on the PTO database.
Valuing a company on the basis of patent applications adds a level of uncertainty on top of the economic uncertainty discussed by the Small Times article.
posted by SWBarns at
8:38 AM
1 Comments:
Nanosys states "Nanosys has built one of the broadest technology platforms in the industry with more than 250 patents and patent applications covering fundamental areas of nanotechnology."
This means two things, either they have a large number of foreign patent applications based on their U.S. applications or there are patents and applications in the United States that I didn’t locate. It might mean both.
If anyone cares to enlighten me, please do so.
By
SWBarns, at 11:41 AM
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