Synthetic biology company Twist Bioscience has joined the long list of life science firms going public this year, raising $70 million in its stock market debut.
The San Francisco company sold 5 million shares at $14 apiece, which was within the $14 to $16 per share range it had targeted. After those shares started trading Wednesday morning, Twist’s (NASDAQ: [[ticker:TWST]]) stock price dipped more than 8 percent morning to $12.80 per share.
As of Wednesday, a total of 179 IPOs have priced so far this year, a more than 43 percent jump from the same period last year, according to IPO research firm Renaissance Capital. But Twist stands out because it has something that many other biotechs that went public in 2018 did not have at the time of their IPOs—revenue, albeit, not enough to turn a profit yet.
Twist, which is led by CEO Emily Leproust (pictured above), has developed a proprietary way of manufacturing DNA by “writing” it on a silicon chip. The company says in its prospectus that its technology makes DNA synthesis scalable and less expensive than traditional methods. In the nine months ended June 30, the company’s fiscal third quarter, the company generated $17 million in revenue, a 132 percent increase compared to the same period in fiscal 2017. But Twist has still suffered a $51.4 million net loss.
The synthetic biology company says it served 539 customers in the past fiscal year, more than half of them in industrial chemicals. Others using Twist’s products include academic research institutions, and agricultural and healthcare firms. Twist’s largest customer is Gingko Bioworks, a Boston company that uses synthetic DNA to develop microorganisms used in many industries. Ginkgo’s purchases accounted for 32 percent of the company’s fiscal 2018 revenue through the third quarter.
Twist has raised more than $363 million in equity financing, most recently a $291.5 million Series D round that closed in July, according to the prospectus. The company’s largest shareholders are Ever Alpha Fund and entities affiliated with Arch Venture Partners, each holding approximately 12.1 percent of the company following the IPO. The post-IPO stake of DNA sequencing giant Illumina (NASDAQ: [[ticker:ILMN]]) is approximately 6.3 percent.
Twist will use the IPO proceeds to invest in equipment and expand research and development. The company also plans to use the new capital to expand its sales and marketing efforts, including a establishing a presence in China.
Here’s more on the origins of Twist and its approach to DNA synthesis.
