White Biotech & Beyond: The Biotope of Players Behind the Start-ups
- May 29, 2012
You have all heard about companies like Amyris, Genomatica Gevo, LS9, Myriant or Verdezyne but have you ever heard about Khosla Ventures, TPG Biotech, Triple Point Capital, Pinnacle Ventures or Kleiner Perkins Caufield & Byers? Well, you should have. Without these investors Lanxess would probably never had invested in Gevo, BASF in Renmatix, DSM in Segetis or Total in Amyris. These "seed" investors are to a large part US based with very few exceptions like Capricorn Ventures or Malaysian Life Science Capital Fund. Their ultimate goal is to exit their investment via a floating of the shares on the stock market, to establish a (traded) price and later to sell their shares. Opposite to an investment in a software or internet company, in biotech you have to finance heavy in investments upfront in large scale plants and product introduction takes years. Thus the favorite business model is to get an industrial partner onboard prior to the capital intensive investment stage and who eventually will take over the company years later. The gains are not as big as for a Skype or Facebook investment but the sole possible way if you want to have a good capital return after 4-8 years. Theses constraints create a kind of biotope of players. Let's have a deeper look at the different players.