Investors place a bet on synthetic biology in Ginkgo Bioworks IPO

·2 min read

Ginkgo Bioworks — a Boston-based company that wants to make biology as easy to program as a computer — began trading on Friday after going public via a SPAC.

Why it matters: Ginkgo's multibillion-dollar offering is a milestone in the maturation of synthetic biology from a science to a true industry.

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Driving the news: Ginkgo's shares — traded under the ticker symbol "DNA" — rose 6.6% on its first day of trading on the New York Stock Exchange, giving it a market cap of $2.6 billion.

  • That's a long way from its founding by a quartet of young MIT Ph.D.s and one veteran professor 13 years ago, at a moment when biotech startups were folding during the financial crisis.

  • "Just as Netscape's IPO was a signal that the internet was going to be a thing, Ginkgo's IPO is a signal that programming biology is a thing, and people should pay attention to it," says Jason Kelly, Ginkgo's co-founder and CEO.

By the numbers: According to the industry newsletter SynBioBeta, synthetic biology startups raised nearly $8 billion last year from VCs and IPOs, more than double the level from 2019. This year funding could surpass $30 billion.

How it works: Ginkgo is applying engineering and automation in its $500 million South Boston foundry to what has been the artisanal craft of manipulating biology, whether in creating new fragrances or in optimizing the making of mRNA vaccines.

  • The company is less interested in making products of its own than serving as a souped-up research platform for the entire synthetic biology industry, akin to what Amazon Web Services has been able to do for tech startups.

  • "Starting a biotech company can cost so much money upfront and take so long," says Kelly. "We can use some of this capital to make it easier and unleash a lot of the latent energy that's out there."

Yes, but: When it merged earlier this year with the SPAC company Soaring Eagle, Ginkgo was valued at $15 billion — a figure some biotech investors believe is excessive for a company that has produced little revenue so far and has no blockbuster products of its own.

The bottom line: A bet on Ginkgo is less a bet on the company itself than on the possibility that synthetic biology — as Ginkgo says in its own marketing materials — can "grow everything."

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