Washington Business Journal
The last couple of years have not been easy for Pixelligent Technologies LLC, but things are looking up for the nanotechnology company, thanks to a new CEO and a major customer.
Less than a year after emerging from Chapter 11 bankruptcy — and getting through messy legal brawls — College Park-based Pixelligent, which develops chemical composites to enhance the properties of existing materials, has a new business partner and an $8.2 million contract from the National Institute of Standards and Technology.
Under the new contract, awarded Dec. 14, Pixelligent will create nanocomposites such as coatings to make brighter and more efficient LED, or light-emitting diode, screens. Brewer Science Inc., a 29-year-old chemical company in Rolla, Mo., is partnering on the contract, which begins Feb. 1.
Pixelligent also has some smaller wins: three National Science Foundation grants and two small business innovation research (SBIR) grants.
All combined, the new work should keep Pixelligent going for about the next three years, said CEO Craig Bandes.
Most people wouldn’t want to take on the leadership of a struggling startup, but Bandes saw something worth salvaging. After all, Boston-based Lux Research says the nanotechnology market is expected to grow to more than $3 trillion globally by 2015.
“It was really a big mess,” Bandes said, but added, “I like building things, growing things and fixing things.”
Founded in 2000 by University of Maryland physicist Gregory Cooper, Pixelligent had shown promise early on, despite its initially risky, long-haul business plan focused on the semiconductor market. While taking shape within the university’s incubator program, 10-person Pixelligent secured Advanced Technology Materials Inc. of Danbury, Conn., as a commercial partner to help bring the new composites to the market, won incubator company of the year in 2006 and since then has raised about $2 million in angel investor funding.
However, when Pixelligent tried to raise a first round of venture capital financing, the company couldn’t make it happen. About the same time, its partnership with Advanced Technology was heading south.
To raise money from other outside investors, Pixelligent needed to alter or terminate its agreement with Advanced Technology. When an invoice from Boston law firm Fish & Richardson LLP that detailed legal advice to Pixelligent accidentally reached Advanced Technology’s lawyers, things got complicated. According to documents, Advanced Technology claimed Pixelligent had improperly made an agreement with a third party. Bandes would not comment on the litigation, which has been settled.
By March 2007, Pixelligent was still hard-pressed to raise the venture funding needed — about $6 million — to move forward, and it filed for Chapter 11. The company blamed its problems on Advanced Technology’s refusal to adjust business arrangements so Pixelligent could raise outside funds.
Bandes came on board at the beginning of 2008 in the middle of bankruptcy proceedings. The company needed $850,000 to get out of bankruptcy, he said. In January 2009, after negotiating two restructuring plans, Bandes thought he had the money. He did, but not until about 15 minutes before appearing in court to prove it.
There is still work to be done. Part of the NIST contract requires Pixelligent to come up with about $2.2 million to fund the project while NIST puts up the rest.
January 18, 2010