Against the Wind - Is Gild Off the Graphene Lily?

As the CEO of an early stage advanced materials company that possesses technology in the manufacture and use of graphene, I have to report a seeming wind change in the world of graphene. As I head out into a second round of funding, I’m sure that my sensitivity to even slight breezes in my market has heightened; nevertheless I think that, at least within the venture community, graphene is loosing its luster. This is my counter argument to the venture naysayers.

Is graphene losing its luster? image credit:

My first involvement with the project that came to be my current company—Xolve—was in early 2010. Interest in graphene was white hot with the material gracing the covers of Science and other equally prestigious publications. Andre Geim and Kostya Novoselov’s work in graphene was on the verge of winning a Nobel at the time and the work they had begun in Manchester University in 2004 had inspired the imaginations of numerous other scientists around the world.

The work of Geim and Novoselov had sparked the revelation of a wide range of potential applications. More importantly, however, while actual commercial products to prove graphene’s value were years away, the fundamental physics tying graphene to a wide range of exciting applications had been published.

Graphene’s two-dimensional structure flaunted previous theory and held out the promise of myriad exciting applications. At ten atomic layers or more of carbon lattice you had graphite, below that you had a wonder material called graphene.

The University of Wisconsin discovery that became Xolve, won the state’s Governor’s Business Plan competition in 2008 and was immediately selected as one of Business Week’s top 30 start ups of that year. Being able to even talk authoritatively about graphene got you in the press. Beginning with the issuance of Xolve’s base patent and license in January of 2010 we started on the funding path.

With nothing more than a CEO, Scientific Founder and a business plan we were able to achieve funding in a year where many weren’t. Exceptional electron and thermal properties, barrier properties, the ability to positively effect a wide range of strength and ‘toughness’ metrics, the high specific surface area of graphene and its promise of being cheaper to produce than carbon nanotubes (CNTs) made the world awash with possibilities. ‘Could graphene be the next disruptive technology?’ was on everyone’s lips.

Xolve began its proof of concept work and the commercial development of its graphite to graphene process in 2011--two initiatives we are just completing. As we emerge from the pre-commercialization tunnel, we have collected a wide range of partners and clients in our target markets of composites and energy storage. We are now ready to seek our ‘B’ round of funding from national and international strategics and venture funds.

While the world is still not short of graphene supporters, hopefuls and press coverage (see the front page of the Wall Street Journal, August 24), there is an emerging change in the venture funding winds in regard to graphene. Carbon nanotubes, rather than running interference for graphene, have spoiled the party.

Possibly the singular event that has thrown water on the graphene fire of late has been the exit of Bayer MaterialScience from the CNT business. Suddenly venture firms are saying two things in regard to graphene: (1) we have seen a twenty year history of CNTs with little evidence of adoption; (2) if a company like Bayer can’t make it in nanocarbon, why should we think small start-ups can make it in graphene?

Let’s look at the two questions being asked by the venture community. First, why have we seen so little adoption after twenty years of CNTs? My view is that CNT production, with few exceptions, followed the traditional structure of the materials value chain.

Supposedly, at the top of the value chain were those who focused on the production economics of CNTs—the resin producers, if you will, of the nanocarbon world. Making CNTs useful would be left to others in the value chain, whether they were technology suppliers, compounders or the applications providers themselves.

Unlike thermoplastic and thermoset resins, however, CNTs needed special treatment. Unlike other forms of carbon additives, CNTs were enormously more difficult. Their highly touted incredible properties and activity level came in many respects from their surface area. We have all read those metrics—1,000 times the conductivity of copper, 100 times the tensile strength of steel, and more. Those metrics came from measurement of these materials in isolation.

As we know, in reality CNTs liked each other more than they liked anything else in the world, they clumped and aggregated to the determent of that prized surface area. In this clumped state, CNTs behaved like expensive but ordinary carbon, not special, nearly magical carbon.

More importantly, the skills required to solve these aggregation problems, at least in the composite and materials markets where initial adoption was predicted, were not the typical skills of the materials value chain. Solving these problems was the purview of university physical chemistry departments. Compounders, article manufacturers and applications providers didn’t have the skills to make CNTs perform.

What was the response of the CNT suppliers? With only a few exceptions, it was not to solve the aggregation problem that would render CNTs useful; it was to try to drive down cost in the assumption that the market demand for CNTs was elastic—that lower prices would drive adoption.

We saw various versions of this. Unidym was bought, sold, consolidated and moved overseas lowering the price of their product at every step but not increasing its demand. Bayer and Arkema applied significant economies of scale to drive down price with no major effect on demand. Cnano and others took production to China to bring price down, still with no macro effect on demand.

This is because CNTs are inelastic in their demand. Their demand is tied to their ability to be used, not to their price. No one wants nanocarbon; everyone wants better materials, materials improved by the addition of the most active form of carbon available. CNTs in an aggregated state were very expensive carbon. Without the ability to make them useful, demand remained the same. In an interview with Ross Kozarsky of Lux Research, Peter Kruger, former head of Bayer MaterialScience, admitted the company should have focused more on application development and working with customers than with raw CNT production.

Bayer’s expertise in polycarbonates and polyurethanes didn’t match with the best CNT market opportunities in epoxies, thermoplastics and energy storage. Bayer’s CEO, Patrick Thomas was quoted in the Kozarsky piece as saying, “the potential areas of application that once seemed promising from a technical standpoint…have few overlaps with the company’s core products and their application spectrum.” In other words, they scaled up CNT production because they had the process chemistry capability to do so but forget to ask the marketing group if what was going to be produced matched their existing customer base. Without customers to collaborate with, the aggregation problem remained unresolved in regard to specific products or applications. Demand stayed low.

While I don’t have the hubris to think that anyone at Xolve is smarter than Germany’s Captains of Industry at Bayer or France’s at Arkema, or China’s at Cnano, I do know that, unlike those companies’ experiences with CNTs, we have made graphene useful.

What will drive graphene adoption in composites and energy storage is price/performance. As in the CNT experience, price can be lowered by scale but must be matched (or at least approximated) by demand. At Xolve we have worked to simplify our production process to achieve a process technology that can be scaled quickly and cheaply as we create demand.

We also have a process that produces a range of atomic thicknesses from the same process. Not all applications need the thinnest material. To be able to match price to performance, we developed one process that allows us to dial in the appropriate price/performance level for customer groupings. Thinner material is, of course, more expensive but higher performing. The one process approach gives us scale across all customers’ demand, however.

More importantly we have focused at maximizing performance across a wide range of polymers and attributes of those polymers. Our base technology provides us with high quality nanoplatelets at what we feel will be the world’s lowest cost. That doesn’t make us any better than the CNT suppliers, however.

We knew that we needed to develop a toolset that would take our dispersed graphene and keep it dispersed while moving it into all of the world’s most used industrial polymers. We developed three different pathways for doing this successfully. Furthermore, we knew we had to also develop tools to optimize graphene (and other nanomaterials as well) for a range of performance attributes in the target polymers.

We have done that across the attributes of strength (by various metrics), thermal and electrical conductivity, barrier properties and toughness. We continue to work on techniques that increase the performance of target materials regarding measures of those and other attributes. We also focus on multiple attribute improvement. With graphene, unlike other fillers, simultaneous improvements in traits that frequently get traded off against each other are possible: conductivity plus strength, not conductivity or strength.

All of these benefits are provided to the customer in master batch form. In this way customers can benefit from the properties of nano materials without having to have special equipment or specialized knowledge. Xolve master batches are a form of graphene-enhanced polymers and energy storage materials that applications providers, compounders and article manufactures can readily use to improve their products and materials.

Therefore, in answer to that first question from the venture community—will graphene have a twenty-year adoption cycle like CNTs—I say it will, if the same business model is used.

Xolve, for one, has done the work to change the business model and provide intermediate forms of graphene that are usable to the market now. We are not asking customers to adopt something new; we are asking them to substitute a better form of carbon for a form they are currently using. As such, we deal with qualification cycles, not adoption cycles.

As to the second part of the venture question—if Bayer failed in nanocarbon, what makes me think that Xolve will succeed in graphene? Bayer failed because it tried to capture a market through its industrial scale—scale up, make it cheaper, the world will flock to your door.

The utilization of nanocarbon is non-linear to the utilization of the carbons that have been in industry for hundreds of years. Early stage companies, like Xolve, by focusing on making nanocarbon usable to the traditional value chain and by also focusing on price performance, can win in this game.

This article was prepared by John Biondi in his personal capacity. The opinions expressed in this article are the author's own and do not necessarily reflect the views of AZoNetwork.

For more information please contact:

John Biondi
President, CEO
Xolve, Inc.
[email protected]
+608.203.8362 x 1001

About Xolve

Xolve technology addresses both of the fundamental problems of nanomaterials: performance and price. The Company’s platform discovery has the capability of actually dissolving nanoparticles in stable solutions.

This capability correctly prepares nanomaterials to better achieve actual performance close to projected performance limits. Xolve’s base technology also allows for the manufacture of nanomaterials, such as graphene, in a very pristine form and at the lowest cost in the industry.


Disclaimer: The views expressed here are those of the author expressed in their private capacity and do not necessarily represent the views of Limited T/A AZoNetwork the owner and operator of this website. This disclaimer forms part of the Terms and conditions of use of this website.


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  1. El Cid El Cid United States says:

    I think it would be better to have more people understand that it isn't about this 'stuff', this 'material', i.e., graphene, but that *graphene itself* is a part of a new set of skills, insights, scientific achievements, and techniques.

    In some ways, graphene is less about a substance and more about something we're able to do.

The opinions expressed here are the views of the writer and do not necessarily reflect the views and opinions of

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