Nanosys Inc (NNSY)

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Venture-capital firm Harris & Harris (Nasdaq: TINY) is a difficult company to follow, because its value resides in the two dozen-plus nanotechnology start-ups in which it has an equity stake.

For a long time, one of its more visible portfolio holdings was Nanosys, a Palo Alto, Calif.-based start-up that many thought would be the first true nanotechnology company to go public.

Well, for a variety of reasons, Nanosys failed to file for an IPO back in 2004, and as a result, it has somewhat unfairly been held up as the poster child for much of the hype that surrounded the field of nanotechnology a few years back.

An article in today's Technology Review, however, reveals that Nanosys is alive and kicking, and it has made deals with both Intel (Nasdaq: INTC) and Micron (NTSE: MU) to begin supplying its metal nanocrystals in next-generation flash memory chips as early as 2009.

By replacing the floating gate in existing flash chips with nanocrystals, Nanosys can help flash-memory manufacturers reduce the amount of insulating material needed and, more importantly, shorten the height of the cells. This combination means that more flash chips can be packed into Apple's (Nasdaq: AAPL) iPhones and iPods so that the devices can hold more pictures, songs, and video. As an added benefit, the metal nanocrystals require a lower voltage to program, and this, in turn, allows the devices to operate for longer periods without needing a charge.

The development is significant for investors because it is yet another indication that nanotechnology is leading to material improvements in commercial products and holds out the possibility that, after a long delay, Nanosys might really be ready to go public -- an event that could give Harris & Harris' stock a nice boost.