If you examine who is delivering the majority of venture capital returns in nanotechnology, it is application-oriented life sciences companies, says analyst firm Lux Research. Yet venture capitalists are consistently providing more funding to companies in other areas.

…That's because "gas prices and global warming make the crises in energy and the environment really visible," Grose says. However, he notes, the need for beneficial nanomedicine remains strong.

"So there are great investment opportunities -- and sketchy ones -- in both areas, and you really need to examine each company's scientific value closely to find value."

That's just one of the findings in Lux Research's new report, "How Venture Capitalists Are Misplaying Nanotech." The report also notes...

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