Another comment on the Nanosys IPO from Barrons which concludes that the offering ” may be risky.” Most IPOs in th las few years have been risky, so no great insight there. The article does put its finger on the pulse when it observes that “CEO Lawrence Bock has made venture capitalists a lot of money” which justifies their faith in him, and Nanosys despite the company only having “34 employees, no salable products and lacking an ability to manufacture nanotech products on a commercial scale.”
Any venture capitalist will tell you that great management and no product will always win over great products and lousy management.
But “in 2003, the company had $3 million in revenues, $12.5 million in operating expenses, and a net loss of $9.2 million. In the 2004 first quarter, revenue came to $1.2 million, operating expenses hit $5.2 million and the loss climbed to $3.9 million from $2 million in the first quarter of 2003.”
It makes us wonder whether Cientifica should go public. With similar revenues, lower operating expenses, profits and a product pipeline, we could always use another $10 million.
Barrons concludes It’s hard to understand, frankly, why this company should be turning to the public markets to raise more capital. This is a development-stage company.
Caveat emptor!