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Case
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Reference no. 9-610-083
Published by: Harvard Business Publishing
Originally published in: 2010
Version: 14 May 2010

Abstract

Cambridge NanoTech (CNT) is an interesting example of how a successful university research project was used to build a small scale business which designs and manufactures research equipment for a new class of chemical reactions called Atomic Layer Deposition (ALD). CNT's business model is particularly interesting since the university researchers/founders developed a product that was specifically meant to serve other university researchers rather than trying to immediately jump to commercial, high volume manufacturing applications. Their product was specifically designed to be low cost, easy to use, flexible, and to have very short delivery times which made it very attractive to university researchers operating large research projects (typically on the order of millions of dollars/year). A large profit margin was possible due to the lack of competition and the perceived high value associated with having these technical capabilities since commercial machines of this type were typically a significant fraction of a million dollars. After a successful launch in 2005, the company experiences serious friction between the co-founders which is resolved when one of the co-founders buys out the other. In 2010, the company is profitable but is facing increased competition and the need to grow its business. The company is considering several different strategies.
Location:
Size:
20 employees, gross revenue USD5 million
Other setting(s):
2009

About

Abstract

Cambridge NanoTech (CNT) is an interesting example of how a successful university research project was used to build a small scale business which designs and manufactures research equipment for a new class of chemical reactions called Atomic Layer Deposition (ALD). CNT's business model is particularly interesting since the university researchers/founders developed a product that was specifically meant to serve other university researchers rather than trying to immediately jump to commercial, high volume manufacturing applications. Their product was specifically designed to be low cost, easy to use, flexible, and to have very short delivery times which made it very attractive to university researchers operating large research projects (typically on the order of millions of dollars/year). A large profit margin was possible due to the lack of competition and the perceived high value associated with having these technical capabilities since commercial machines of this type were typically a significant fraction of a million dollars. After a successful launch in 2005, the company experiences serious friction between the co-founders which is resolved when one of the co-founders buys out the other. In 2010, the company is profitable but is facing increased competition and the need to grow its business. The company is considering several different strategies.

Settings

Location:
Size:
20 employees, gross revenue USD5 million
Other setting(s):
2009

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