**Update: Added comments from Ginkgo Bioworks CEO Jason Kelly**
Ginkgo Bioworks, a Boston startup genetically engineering microbes for partner companies in the flavor, fragrance, agriculture, and food industries, has raised $275 million in a Series D round, bringing the company’s total funding to $429 million.
AgFunderNews has confirmed that Ginkgo has reached “unicorn status” — meaning it is valued at or above $1 billion — which would make it the second agtech unicorn in Boston, joining Indigo Agriculture, which closed its Series D on $203 million last week.
Ginkgo’s microbe designers write new DNA code that will re-program the genome of a microbe to do what customers want using proprietary, in-house software. The DNA designs it creates are also proprietary to Ginkgo, as well as the robotics and other technology the company uses to culture the microbes, mostly through a fermentation process.
Ginkgo clients include ADM, Cargill, and Japanese food and chemical company Ajinomoto.
The new funding will go toward building out the company’s new robotic microbe foundry “Bioworks3,” and branching out into more industries beyond the company’s mainstays of agriculture and pharmaceuticals. Ginkgo CEO Jason Kelly told AgFunderNews that the new foundry will add 17,000 sq. ft. of foundry space bringing the total at the company’s Boston facility to 74,000 sq. ft.
This round includes several return investors in Viking Global, Y Combinator’s Continuity Fund, Cascade Investment, Bill Gates, as well as new investor, private equity firm General Atlantic.
Viking also led Ginkgo Bioworks’ $45 million Series B round in 2015 as well as participating in its $100 million Series C round in 2016. The hedge fund is also part of the new startup venture formed in partnership with Bayer CropScience, which Ginkgo announced in September. The three firms jointly invested $100 million in the as-yet-unnamed startup, which is co-located at Bayer’s biologicals R&D facility in West Sacramento and at Ginkgo’s Boston facility.
The new biotech company is the fifth investment by the Bayer Lifesciences Center (BLSC), which operates as a strategic innovation unit within Bayer and directly reports to Bayer’s management board. Previous investments by the group include Casebia (CRISPR/Cas technology) and BlueRock (induced pluripotent stem cell technology).
“[The joint venture] will use some of the capital that its raised to use our foundry to do the genetic engineering of the microbes at a much lower cost and higher throughput then if you spent that money hiring a bunch of scientists to work in a lab,” said Kelly.
“The cost to do lab work here is about five times cheaper on a per-lab protocol basis. So that $100 million is like spending $500 million in a normal R&D setting. And if we can keep the foundry improving then the benefit will go up even more,” he explained.
The new company will focus on manufacturing microbial products to help with nitrogen fixation and minimizing agriculture’s environmental impact by decreasing the amount of chemical fertilizers farmers apply to crops
Partnerships with big strategics have been a significant part of Ginkgo’s growth. In 2016, the company announced a collaboration with Cargill to explore strain improvements to optimize Cargill’s bio-industrial fermentations.
Ginkgo has never taken investment from strategics however, which Kelly says is deliberate.
“Our customers are these really big companies and so you to be a little careful. If you take an investment from Google it’s harder to work with Amazon,” he said.
Kelly indicated to AgFunderNews upon announcing the raise in 2016 that his intention is to eventually take Gingko public and he says that that is still the intention, but is not ready to offer a timeline for a public listing.
“We’re not in a rush. Our attitude on it is that we make sense as a standalone company because we think microbe engineering and design is a standalone industry and eventually we’ll go public when its the right time,” said Kelly.
The future of engineered microbes seems particularly bright today after Silicon Valley VC Andreeson Horowitz announced a new $450 million fund targetted at the intersection of biology and engineering. Kelly says that this is one of many signs that the falling cost of microbe design and manufacture is introducing this technology into fields that wouldn’t have previously considered it from food to textiles.
“I think there are going to be a whole bunch of surprising new markets opening up as the cost to do this kind of work falls,” said Kelly.
Competing with Ginkgo in the microbe design and manufacturing business is Zymergen. The California startup has raised $174 million, most recently raising $130 million in Series B funding in 2016 led by Softbank.
Photo: Ginkgo Bioworks
