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Five Years After Y Combinator First Admits Biotechs, They’re Dug In

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sessions from that point on. The incubator recognized in 2014 that biotechs and other life sciences companies would need bigger initial investments than most tech startups, which often require no more than laptops and desks by way of equipment. So YC raised its standard investment in each of the startups it admits—including tech companies—from $17,000 for a 7 percent stake to $120,000 for the same amount of equity. YC’s investment in its startups has since been raised to $150,000.

Back to today: Life sciences companies now make up a much bigger percentage of successful applicants to YC’s incubator program, compared with the 2014 startup batch. For the summer 2019 session, 14 percent were working on projects related to healthcare.

Gingko and other YC life sciences grads are now making it easier for new YC startups to launch their biotech projects, YC partner Jared Friedman writes in a Sept.16. blogpost.

In a partnership with YC, Gingko will create novel microbes envisioned by young synthetic biology teams, using its bioengineering platform at no initial charge. Instead, Gingko will gain an equity stake in the YC companies it helps. Engineered microorganisms can not only become products themselves, such as medical treatments—they can also be used in cell cultures as living factories to churn out valuable proteins and other biomolecules.

Friedman says such partnerships are lowering barriers to entry for life sciences startups, the same way that subscription software companies such as Amazon Web Services (AWS) have been reducing initial costs for tech entrepreneurs before they’re ready to scale up their projects.

“Ginkgo providing startups access to their platform is a big step in the shift that we see towards the AWSification of biology,’’ Friedman writes.

“Ginkgo now joins YC companies like Culture Biosciences, Atomwise, and Excepgen that are making it possible for bio companies to use existing building blocks rather than doing everything from scratch. As this trend accelerates, it will become faster and cheaper for new bio companies to get started,’’ Friedman says.

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