As a nanopreneur, how do you describe, characterize and categorize your venture? Businesses are often characterized as belonging in a particular industry. A great deal of this is informal but not arbitrary or unimportant. Characterizing a new venture effectively can make it easier to attract an effective team, great customers, and savvy investors.

Underlying the categorization of all businesses is the North American Industry Classification System (NAICS) provides a framework, which is used by government agencies, market research organizations, and others. NAICS lacks a broad category for nanotechnology as an industry, which results in nanotechnology-based companies being distributed across many other categories.

Startups are no exception to the impulse to categorize and characterize. Crunchbase uses keywords to identify a number of nanotechnology companies and institutes most of which attach other keyword(s) for their industry and/or product. This isn’t surprising as venture capitalists tend to focus on industries or sub-industries. As this 2015 TIME article describes, nanotechnology doesn’t fit neatly into industry categories and many new ventures find other ways to identify themselves depending upon their plans to grow.

So how should a nanopreneur working to commercialize technology based upon university research consider defining a new nanotech startup? There are (at least) six  essential perspectives:

• Members of the early team may be thinking about the new venture in terms of their own professional identities e.g., physicists, electrical engineers, material scientists, nanoscientists, or boundary spanning inventors. This is often the de facto starting point for a university startup’s identity as a business. This identity has great value in terms of ongoing research and development, recruiting technical staff, and envisioning future business opportunities based on science and engineering.
• As the team develops and grows, an interdisciplinary identity that integrates the disciplines of individual team members can help to define the team and venture. This identity can be grounded in shared values, passion for solving a shared problem, the special capabilities enabled by a transdisciplinary team, or some other dimension that is specific to the venture.
• Members of the investment community (angels, venture capitalists, corporate venture groups) are likely to want to know how your new venture fits into one of the industries in which they invest. This identity has great value when seeking investment and other venture development connections.
• Future customers are likely to have a different perspective than either your team or potential investors. This is likely to have more to do with the value chains, the industries with which they associate themselves, or what might help them to standout to their customers than it does with the new venture’s broader potential.
• Venture accelerators, competitions, small business grant programs, other stakeholders and resource providers may insist on characterizing participants in terms of priority areas such as clean energy or a particular disease.
• Regulatory and standards organizations may impose categories that define nanotech-based ventures. New nanotech ventures may fall under the purview of one or more of these organizations. An astute nanopreneur will be thoughtful about navigating this landscape to control risk and, ideally, to gain an advantage over competitors.

Reconciling, aligning, and navigating these perspectives is one of the tests nanopreneurs face. As nanotechnology matures it will be interesting to see if it will become like other technologies that are now well understood to have applications in many fields, like those that have given rise to new industries, or some of each. In any case, until there is greater clarity, nanopreneurs will face a special challenge in how to categorize and characterize their new ventures.

* Kevin Kelleher, “Here’s Why Nobody’s Talking About Nanotechnology Anymore”, http://time.com/4068125/nanotech-sector/ and all other external references in this post were retrieved November 7, 2016.

© 2016 University of Massachusetts Amherst