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TINY's Tiny Growth Engine

Scientific American may not be on the top of most Fools' monthly reading list, and even if it is, subscribers may still have passed over this month's article entitled "Viral Nanoelectronics." If you are an investor in the Motley Fool Rule Breakers recommendation Harris & Harris (Nasdaq: TINY  ) , however, the article is worth a read.

According to Scientific American, Angela Belcher, a leading researcher at MIT, is using viruses to grab, tag, and manipulate inorganic molecules. Picture these viruses as little machines that can distinguish and select specific molecules -- kind of like being able to pick up individually colored Lego blocks -- and then place those molecules next to other molecules with which they will bond. By repeating this trick over and over again, the virus can assemble small devices with unique properties.

Why is this amazing exploitation of biology important to Harris & Harris investors? To begin with, Angela Belcher is also the co-founder of a nanotechnology start-up company called Cambrios, located in Mountain View, Calif. It just so happens that Harris & Harris is an investor in Cambrios.

Now, Cambrios is only one of about two dozen nanotechnology start-ups in which Harris & Harris has invested, so the venture capital firm's overall health isn't dependent on its success. Nonetheless, Cambrios is certainly one of its more intriguing investments, given the potential applications of its technologies. According to the Scientific American article, sometime next year, the company plans to bring to the commercial marketplace a touch-sensitive computer interface thin enough to be embedded in a flexible plastic sheet.

The first client for this technology is the U.S. Army, which is interested in having a flexible screen that can be placed on a windshield, giving soldiers a transparent interface that won't hinder their field of view during critical combat operations.

The application is limited, but the Army will probably pay Cambrios good money if it can develop the product to its specifications. Cambrios can use this money, in turn, to pursue other commercial applications -- of which there should be no shortage.

To begin with, batteries assembled via Cambrios' processes are extremely lightweight. For any number of firms -- especially laptop manufacturers such as Dell (Nasdaq: DELL  ) or Hewlett-Packard (NYSE: HPQ  ) -- the ability to reduce their products' weight could offer a critical advantage. Because the battery can also be "grown" to exact specifications, it could conceivably be molded to fix to whatever space a product designer needs, freeing designers to rethink their products' look and feel.

One need only look at Apple's (Nasdaq: AAPL  ) iPod or Motorola's (NYSE: MOT  ) RAZR to appreciate the importance of combining form and function, and to understand how attention to such details can boost a company's bottom line.

In addition, because Cambrios' batteries are manufactured at the molecular level, the process uses no toxic solvents. Manufacturers may not have to deal with costly regulatory issues, nor will customers have to worry about disposal issues. (Most of the battery is made of biological material, so it will simply biodegrade.)

Cambrios' self-assembly process is not limited to battery technology. In the longer term, Belcher and company CEO Michael Knapp -- who was formerly CEO at Caliper Life Sciences (Nasdaq: CALP  ) -- believe that viruses can be used to grow "smart threads" capable of detecting toxic biological or chemical agents.

It's even possible that the viruses could do everything from detecting molecular-level defects in semiconductors and airplane wings to "growing" complete semiconductor components. This latter paradigm-shifting potential makes Harris & Harris a real Rule Breaker, and explains why Cambrios might just be the engine that drives TINY's future growth.

Interested in other foolishness about Harris & Harris? Check out these recent articles:

Keep up with the latest big developments in tiny tech, and other cutting-edge breakthroughs, when you join David Gardner and theMotley Fool Rule Breakersteam in their search for the next ultimate growth stock. Get David's latest future-focused picks, and full access to his archived recommendations, with a free 30-day trial.

Fool contributor Jack Uldrich is the author of two books on nanotechnology, including Investing in Nanotechnology: Think Small, Win Big. He owns stock in Harris & Harris. Dell is a Stock Advisor an an Inside Value pick. The Fool has a strictdisclosure policy.

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