Publicly Traded Nanofirms

Publicly traded firms are companies whose stock shares and other securities are available for sale to the general public and for resale on the secondary markets, typically through the stock exchanges, and occasionally only through over-the-counter trading. Ownership of a share of stock confers partial ownership of the company, with attendant rights, including influencing the course of the company (through votes proportional to stock share, at shareholders meetings, and through the election of company directors or officers) and profit sharing (through the capital gain attained by selling shares, and often through dividends paid periodically by the company).

There are a number of reasons for a company to go public, primarily to raise funds. Day-to-day revenue streams may not be sufficient to fund new projects or expansions, and in the case of new companies, may not be in place yet. It's no coincidence that the stock market rose in prominence and public awareness during and immediately following the industrial revolution—since which the discovery, improvement, or innovative new application for a technology has been the primary goal for many companies, and the engine of many fortunes.

The stock market has become a typical funding source for new technologies, particularly those whose developments have been anticipated (as with the many new transistors and transistor alternatives promised by nanoscience) and for which there is an existing demand. Issuing stock, or other securities, is also the easiest method for gathering capital for a rapid expansion. While a privately owned company can issue bonds to achieve this goal, those securities will be of a lesser value on the open market, while those of publicly traded companies have an established fair market value and represent a safer haven for the investor.

New companies typically begin under private ownership, and gradually work toward trading publicly. Under the counsel and guidance of an investment bank, they may initially sell special shares in the form of private placements, and perhaps raise capital from a venture capital fund before an initial public offering (IPO) that places the stock on public exchanges, a movement that can make taking the company private again a difficult proposition (requiring the company buying up its own stock). Successful and rapidly expanding private companies, especially in growing fields, are often watched closely in anticipation of their IPO; such was the case with eBay and Amazon during the “dotcom” boom, and was also the case with the Swiss nanofirm Nanosys in the 21st century, which develops products for industrial and home use based on nanochemistry.