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Nanotechnology: Revolutionizing Manufacturing, Revitalizing Communities

Nanotechnology is revolutionizing all sectors of manufacturing and expanding new business possibilities in American cities.

John K. Borchardt (November 2010)
(page 2 of 3)
Solexant
Gresham, Oregon, a suburb of Portland, exemplifies top factors in attracting nanotechnology companies. Solexant, a San Jose, California-based solar energy startup, chose Gresham for its first manufacturing facility. The Multnomah County plant will produce solar cells modeled on nanotechnology. When completed, it will be the world's largest nanotechnology-based manufacturing facility. The factory will initially locate in an existing 150,000-square-foot plant, with plans to construct a new facility in 2011. Solexant's plant will mean immediate jobs for Oregonians with the promise of more in the future, says state Governor Ted Kulongoski. The company also introduces a new technology to Oregon's booming solar manufacturing industry. The new factory will create about 200 new jobs, with up to 800 additional jobs ultimately slated.

Financing drove Solexant's decision. The Oregon Department of Energy has loaned the firm $25 million, plus an $18 million tax credit and $64 million in equity funding. In exchange for the tax credit, Solexant has reserved 97 of the new plant's 200 jobs for county residents.

But more than money attracted Solexant to Gresham. Quality of life was also important. The Portland area has good public transportation, many bike paths, and excellent air quality. And many highly educated and mobile 25- to 34-year-olds move to the state for quality of life reasons, according to the Oregon Business Association.

Business Incubators
Mihail C. Roco, a senior adviser for nanotechnology at the National Science Foundation, says most nanotechnology jobs have resulted from nanomaterials breaking into sectors such as the chemical industry. These sectors incorporate nanomaterials into products through their own research and development programs, and by investing in nanotechnology companies to develop nanomaterials, manufacturing processes, and applications.

Nanotechnology startups need highly skilled scientists and engineers. As a result, these companies often locate near universities with active nanotechnology research programs, which can sow the seeds for commercial technologies. Many nanotechnology outfits initially locate in business incubators. There are more than 300 U.S. incubators, many of which are affiliated with universities.

Companies in incubators help local communities prosper. Most incubator employees are high-earning scientists and engineers. When a nanotechnology company outgrows the incubator, it often relocates nearby. A University of Michigan study found that 84 percent of business incubator employees remain in the community, boosting employment and the local economy.

The Houston Technology Center (HTC) incubator, which works with 60 companies at a time, focuses on nanotechnology and energy. Rice University and the University of Houston have large nanotechnology research programs that train scientists and engineers. In the last decade, firms in the HTC raised $1 billion in funding, including $125 million during an economically challenging 2009.

NanoRidge Materials
NanoRidge Materials graduated from the HTC and relocated to a 55,000-square-foot facility in Houston. Remaining in the city made sense, as it could keep in touch with Rice University, the University of Houston, Texas A&M, and Texas Southern University, from which it has licensed technologies. NanoRidge employs several graduates of these universities, some of whom helped originally develop the licensed technology. NanoRidge uses this technology to produce metal alloys 10 times stronger than steel.

Mergers and acquisitions are reshaping nanotechnology firms like NanoRidge and influencing location decisions. NanoRidge has partnered with Riley Solutions to produce nanotechnology enhanced body armor for the U.S. Department of Defense (DOD) and law enforcement personnel. As part of the agreement, Riley relocated its headquarters from North Carolina to Houston.
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