Turning these new properties into new products will take some time. Some observers point to the failure of Nanosys to go public last summer as a watershed moment in nanotech investing. And not a bad moment, but a very encouraging one that signaled that Wall Street wasn't about to get too manic about emerging nanotech companies. (Nor are venture capital firms, which invested $200 million in nanotech startups last year, down 39% from 2003.) One big success could shatter that sense of sobriety. But for now, investors have plenty of time to think rationally about nanotechnology. "I think the market is smarter," says Tim Harper, president of U.K.-based nanotech-research firm Cientifica. "The Nanosys IPO was rejected for a very simple reason: Where's the product? You've got a bunch of IP intellectual property . So what?" This is the first story in a multi-part introduction of nanotechnology to investors. Next: Common myths about nanotechnology.