Many of those investments were oversubscribed, so potential investors had to be turned away. So what's the difference between them and other start-ups starving for venture money? Simple: They are making and selling stuff. "These venture capitalists are only looking at nanotech companies that are making real money," says Barry Weinbaum, CEO of NanoOpto, whose components are found in telecom equipment and in consumer electronics such as cell phones and DVD players. "These are companies that have the technology risk behind them. They're manufacturing products with customers behind them." NanoOpto's third round of investments in March came more than four years after its initial funding. Unlike the first two rounds of investments, when Weinbaum needed to coax money from VCs without the lineup of customers it has today, NanoOpto was turning away investors in its latest round. "The companies that are surviving are showing a degree of diversification," Weinbaum says, as NanoOpto branched out of its initial telecom focus into consumer electronics. For venture capitalists, risk is as commonplace as oxygen -- and just as vital for their success. The risks of companies using nanotechnology are twofold: Will the technology pan out and will it sell profitably? If this first generation of nanotech start-ups is indeed coming of age, that means, yes, the technology has been turned into a product that others may buy. The trick now is to get more people buying it. The $155 million invested in nanotech start-ups is only 3% of the $4.6 billion in venture financings in the first quarter, giving life to the cliche that VCs are falling over themselves to invest in nanotech. While the later-stage investments in companies like Nantero and NanoOpto suggest that some early nanotechnologies are hitting the marketplace, many VCs remain cautious. "We have to look at a commercial business in a three- to five-year horizon," says Steve Krausz, a partner at U.S. Venture Partners. "If you can bring it out of the lab within five years, that's of interest to us. But you're not going to see much of a nanotech boom until much later." Krausz pointed out that the discovery of the transistor came in the late 1940s, nearly three decades before Intel ( INTC) made a big impact with semiconductors. "The time cycle has been compressed, so instead of taking 30 years, it will probably take five to 10," he says. "But that's still a lot further off than many people are expecting."