Special Report: 2017 Graphene Investing Outlook

Graphene has been heralded as the gateway to a new era in science and technology, a veritable “wonder material.” As one of the simplest allotropes of carbon, it exhibits a wide range of capabilities that have amazed the public and sent scientists into a research frenzy.

At one atom thick, it is a true two-dimensional substance, and the thinnest material known to man. It also has nearly zero mass. It has an electrical conductivity six orders of magnitude higher than copper, is flexible and yet impermeable to gases. It's truly amazing.

Because it is such a diverse substance that hasn't yet found a mass-market application, it is a wide open field of investment that is essentially ONLY ground-floor opportunity.

This report examines the advantages and shortcomings of graphene as a tech component, draws a map of the competitive landscape as it has developed so far, and finds some unique areas of potential investment.

Graphene's Short History

As far as groundbreaking scientific discoveries, graphene's was staggeringly simple and has triggered an innovation gold rush

Using regular graphite and regular adhesive tape, University of Manchester professors Andre Geim and Konstantin Novoselov managed to peel flakes of carbon only a single atom in thickness from graphite back in 2004. Graphite is made up of stacks of atom-thick layers of carbon, and the researchers stripped away all layers but one.

Graphene, which was conceptualized in the 1910s and officially named in 1962, was finally easy to make.

Essentially, the discovery was made by peeling up pencil scratchings with scotch tape. The discovery was so simple that the duo attempted to publish their findings in the journal Nature twice but was rejected both times.

Eventually, however, their findings on Graphene and its use as an electrical conductor were published, and they went on to win the Nobel Prize for Physics in 2010.

Six months later, the EU invested a billion euro on graphene research and MIT opened a center for graphene research. Thirteen months later, Geim and Novoselov were knighted by the Queen of England. From that point, international graphene research and development snowballed, with multiple billions of dollars worth of investments being made.

Graphene and its close cousin, the carbon nanotube (basically a rolled-up sheet of graphene), are now some of the hottest areas of scientific research. The list of their potential disruptions is massive and the list of researchers and companies looking into the first big breakthrough is equally huge. Below we've compiled a broad sampling of experiments and discoveries with graphene.

Energy and Transportation —

Because graphene and carbon nanotubes are such efficient conductors of electricity, one of their primary applications has been in novel energy solutions.

Researchers at Rice University invented a graphene-doped cathode that could make dye-sensitized solar cells a reality.

These type of solar cells have been in development for over 20 years, and have never reached the efficiency of silicon-based solar cells. However, they offer their own advantages. They are extremely cheap, semi-transparent, and can be fabricated anywhere. They can also work indoors or in semi-darkness.

Researchers fuse long bunches of carbon nanotubes onto a layer of graphene with the catalyst acting as a cap on the end of the nanotubes. This hybrid material — called a “nanotube forest” — is grown directly on a nickel substrate, combined with an iodide salt-based electrolyte and an anode of flexible indium tin oxide, titanium dioxide, and photon-capturing organic dye to become a solar cell.

The whole thing is as thick as two sheets of paper.

Graphene could be used in lithium batteries, and it has the potential to vastly increase their overall energy density. A lithium-sulfur battery has a much greater capacity than a lithium-ion battery, but batteries using this arrangement have a very short cycle life because sulfur is extremely soluble. Researchers at the Lawrence Berkeley National Laboratory have been working on using graphene to inhibit the solubility of sulfur to improve these batteries.

But lithium is not the ideal material for a battery, so researchers are constantly on the lookout for the next best chemical concoction to make new batteries. Recently, the journal Nature published research with aluminum anodes and graphene foam electrodes in batteries. The resulting battery didn't have a significantly improved capacity over standard lithium-ion batteries, but it was flexible, and it was vastly safer. Researchers said they could drill a hole in the battery while it was in operation with no dangerous effects. This could be useful in applications where ruggedized batteries are needed. After all, it only takes a short puncture for a standard cell phone battery to become a dangerous explosive.

Improved energy output is one of the primary interests of automotive companies looking to develop cleaner vehicles. Battery-powered electric vehicles, however, are not the only type of transportation that can benefit from graphene. In 2011, South Korean automobile companies Kia Motors and Hyundai Motor Company applied for a U.S. patent for a graphene-based fuel cell. The patent is for a special composite electrolyte membrane for a fuel cell where “graphene nanostructures are impregnated into a hydrocarbon electrolyte membrane.”

One of the major challenges of building fuel cells is creating an efficient mechanism for separating protons from hydrogen. Researchers have found that a “defective” graphene layer acts as an extremely efficient proton filter.

“We found if you just dial the graphene back a little on perfection, you will get the membrane you want,” said Franz Geiger, a professor of chemistry at Northwestern University. “Everyone always strives to make really pristine graphene, but our data show if you want to get protons through, you need less perfect graphene.”

Textiles —

Graphene's flexibility, tensile strength, and electrical conductivity have inspired researchers to experiment with its qualities in fabric.

For example, a team at the University of Exeter in the UK has developed a method for coating textile fibers with graphene, making a transparent and conductive material for wearable technology. Australian researchers have done something similar with graphene oxide yarns. The wet-spinning technique used by these researchers is simple and scalable. Like the discovery of graphene itself, its application is sometimes deceptively simple.

Wearable technology is considered the next evolution of human communications before we get to the era of bio-integrated and implanted technology. Graphene-infused fabrics exhibit a lot of promise in this area.

But even if electrical conductivity is not the final outcome of graphene-imbued fabrics, the application is still useful. Carbon nanotubes, for example, are a known toughening agent for polymer composites. When graphene is wet-spun into cloth fibers, it could turn into a material that is tougher than Kevlar or spider silk.

Industrial Lubricants and Coatings —

Friction is one of the biggest enemies of mechanical devices. It causes energy to be lost and stress to be placed on machinery.

One of the newest applications of graphene is in lubrication. Not only does the material exhibit near-superconductivity, but it also can be mixed with related substances to create superlubricity. In other words, near-zero friction. It's like superconduction, except with physical motion, and it comes from an unusual interaction.

The contact between graphene, diamond particles, and carbon fiber creates an incredibly slippery reaction. The U.S. Department of Energy's Argonne National Laboratory found that the three closely-related substances create a confusing and interesting reaction when put together. The graphene rolled itself around the diamond particles, forming tiny ball bearing-like substance called a “nanoscroll” that changed its orientation to let it slide along the carbon surface.

Graphene looks to be an excellent coating for a number of different applications.

Vanderbilt University created a film of Graphene Oxide that causes water to bead and run off or spread into pools. Since graphene sheets are transparent, this could be applied to automotive windshields like a permanent Rain-X coating. It could also be used to create water-repellent clothing, or self-cleaning glass.

Several university research programs are testing graphene as a corrosion-proof coating for copper and other metals. The University of Buffalo began research in 2012, and Monash and Rice Universities both started their own programs in 2013.

Data and Sensors —

Wireless communications requires specific filters to sharpen electromagnetic signals and eliminate interference. Researchers have come up with new filters in the terahertz spectrum, which is considered the next generation of wireless communications. Radio waves and wireless communications waves are generally on the lower end of the electromagnetic frequency spectrum. Terahertz waves come in just about the middle of the spectrum, higher than microwaves and in the infrared light range.

The terahertz range promises to carry our data thousands of times faster than current wireless technology.

Graphene has been shown to be an excellent filter and linear polarizer for devices communicating in the terahertz range, including modulators, detectors, and metamaterials.

Graphene has broadly applicable filtration qualities thanks to its amazing conductivity. Not only can it filter electromagnetic waves, but it can act as an extremely sensitive biological sensor. As soon as ANY molecule binds with it, its electrical conductivity drops. It's got possibility, but it's entirely too sensitive. The HZB Institute for Photovoltaics has been working on improving its selectivity so it can be used to detect traces of organic molecules.

Robotics —

Skin is often called the largest organ of the human body; it serves as a protectant, a coolant, and a sensory input device. Graphene might be able to duplicate some of that functionality for robots.

Researchers at Exeter University in the UK used a cutting-edge chemical vapor deposition (CVD) machine from British graphene company Moorfield to create a transparent, flexible touch sensor that could eventually be turned into a new type of “robot skin.”

Nanomachines —

In one of the stranger experiments with graphene, researchers created a “nano sun” with a graphene conductor. They applied a 2- to 3-volt charge to a layer of graphene, and the spark rose in temperature to 2500 degrees celsius, or half the heat of the sun.

The interesting thing about this experiment is that graphene only emits 2% of its heat energy in the form of visible light, and yet this tiny little atom-thick speck of graphene was visible with the naked eye. The phenomenal heat and electrical conduction of graphene means it can be used as a tool on a nano-scale. Imagine a thermal cutting torch that's so small that it can do accurate surgical procedures at a cellular level.

Semiconductor —

As of right now, graphene is useless as a semiconductor, since its conductivity can't be “turned off.”

A semiconductor is a material with a small, but non-zero band gap that allows electrons into its conduction band at temperatures below its melting point. A material with a very large band gap is an insulator because it lets few or no electrons in. In conductors, the valence and conduction bands might touch or overlap, so electrons flow freely through them. Semiconductors lie somewhere between these two extremes.

In graphene, there is no range of energy where electron states cannot exist. The conduction band and valence band actually overlap. Since there is no band gap, it is a full conductor and not semiconductor. This is a drawback in certain applications, but its properties are still being explored.

The Companies

Graphene is cheap and relatively easy to produce, yet the industry is currently immature. Since graphene is a carbon allotrope, it is essentially available anywhere. Because of this, the best investments will be the companies that can successfully apply the substance in beneficial ways.

However, there are really no “killer applications” for graphene yet, and it generally lacks a commercial product at present. Still, it's being made in record amounts, and being applied to all different types of research.

This means graphene-exclusive investments are few, yet major materials companies of all types are exploring the possibilities graphene affords. Many of them also hold fundamental patents for graphene production.

Most of the world's graphene patents come from Asia. Six of the top ten graphene patent holders are located in Asia. Four of them are research universities, and the rest are companies. Chinese and South Korean companies hold 43% of global graphene patents, and U.S. companies hold only 23%.

Fortunately, many of these are immediately available.

Sandisk (NASDAQ: SNDK) — South Korean flash memory leader Sandisk Corp owns 36 patents for graphene production, including some processes for nonvolatile, sub-10 nanometer graphene RAM.

Foxconn Electronics (OTCMKTS: HNHPF) — The famous iPhone manufacturer, Hon Hai Precision Industry (or Foxconn) has 35 patents for graphene technologies. One of its pending applications is for a composite speaker that utilizes a carbon nanotube film as a part of the resonant surface.

Apple (NASDAQ: AAPL) — Apple is still the biggest stock out there, and it's got modest plans to incorporate graphene into its Mac products already. According to a patent application from the company, it plans to incorporate inkjet-printed graphene into its connector surfaces to improve the conductivity.

IBM (NYSE: IBM) — “Big Blue” has invested $3 billion in advanced systems with graphene, carbon nanotubes, and quantum computing. Because of its early endeavors in the space, it has a whopping 64 patents for production, more than any other American company.

Lockheed Martin (NYSE: LMT) — The famous aerospace engineer and military contractor acquired a patent for graphene-based water filters in 2013 and plans to have a prototype out soon. Portuguese researchers recently found that graphene oxide-based water filters in a teabag-like pouch have the ability to remove mercury from water better than activated charcoal, the industry standard heavy metal filtration substance.

McAlister Technologies — It may be the 10th largest graphene patent holder in the United States, but it's not a "they," it's Roy McAlister, president of the American Hydrogen Association, a 501c nonprofit based out of Arizona dedicated to hydrogen fuel cell technology. In the interest of fuel cell development, McAlister has a handful of graphene patents. While it's not clear what McAllister plans to do with these patents, he shows that a niche application of graphene can yield a massive amount of valuable intellectual property.

Graphene Corporation aka Elcora Resources (TSX V: ERA) — This Canadian company already makes graphene, but is scaling up to a full processing plant that it expects will begin production in the next six months.

Biogenic Reagents — Though the application of graphene is where the money will be, the manufacture of the substance can easily be disrupted. Biogenic is working on graphene that comes from a wood feedstock instead of coal-based, which promises a 50% greater absorption capacity.

Garmor — This materials company uses a single machine process to make up to 20 tons of graphene oxide per year to meet the demands of commodity-type applications. This automated turnkey system can be sold to other companies and promises water as its only byproduct.

The Bottom Line

Graphene has garnered a tremendous amount of hype for all of its potential uses, but there has yet to be a major breakthrough in its application. By tracking various research endeavors and the growing list of graphene-related patents, niche leaders will be found. As it stands right now, it's still anybody's game.

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