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Zymergen

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Zymergen Inc.
Company typeSubsidiary
Nasdaq: ZY
IndustryBiotechnology
Founded2013; 11 years ago (2013)
Founders
  • Jed Dean
  • Josh Hoffman
  • Zach Serber
DefunctFebruary 5, 2024; 9 months ago (2024-02-05)
Headquarters
Emeryville, California
,
U.S.
Key people
Jay Flatley (Chairman & acting CEO)[1][2]
Steven Chu (Board member)[3][4]
ParentGinkgo Bioworks

Zymergen was an American biotechnology company based in Emeryville, California. The company applies genomics and machine learning to research and design chemical producing genetically modified organisms. It claimed that its manufacturing process was safer and cheaper than traditional manufacturing, but was unable to demonstrate this. Shortly after going public in 2021, it was reported that the company was facing difficulties in manufacturing and struggling to make revenue. In July 2022, Ginkgo Bioworks agreed to acquire Zymergen for $300 million.

History

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Zymergen was founded in 2013.[5] by investment banker Joshua Hoffman, biophysicist Zach Serber, and biochemist Jed Dean.[6] All three met while working at Amyris, Inc.[7] The company uses machine learning and artificial intelligence to study and modify microbes which ferment carbon[6] to produce chemicals used in manufacturing consumer goods and pharmaceuticals.[8] Part of its research was into the production of alternatives to petroleum products.[9] The company claimed that it would be able to biologically produce materials more safely and at a lower cost than traditionally manufactured petroleum products, but was unable to demonstrate the performance of its materials.[10]

The company raised $2 million in 2013, $44 million in 2015,[11] $130 million from SoftBank's Vision Fund in 2016,[12] $400 million in 2018,[13][14] and $300 million in 2020.[15] The company reportedly included DARPA and Fortune 500 companies among its customers by 2016.[16] In 2018, Zymergen acquired fellow biotechnology firm Radiant Genomics.[17] According to an insider source reported by Forbes, the company was failing to generate revenue by this point but continued to attract investment. By April 2020, the company had begun to lay off between 10% and 15% of its employees.[2]

The company released its first product, Hyaline, in December 2020.[18] Hyaline is a bio-manufactured polyimide film made from diamine monomers. The material was transparent and flexible,[19] and was marketed for use with consumer electronics such as flexible smartphones and tablets.[7] In April 2021, the company went public with a $500 million IPO. The IPO was led by JPMorgan Chase and Goldman Sachs.[18][7]

Regulatory filings with the U.S. Securities and Exchange Commission in July revealed that the company had made only $13 million in revenue during 2020, and had lost over $262 million.[20] The filings also revealed that the company was struggling to produce Hyaline, and that two of its companies had complained that it did not work with their manufacturing process.[21] When these operational problems became public it resulted in a sharp reduction in market capitalization and shareholder lawsuits were filed shortly after.[2]

In August 2021, the company revealed that Hyaline was not successful with customers, its foldable screen did not have as large of a market as anticipated, and it did not have any sources of revenue that year.[22][23] This disclosure and Hoffman's resignation as CEO that month caused Zymergen's stock to plunge.[24] He was replaced by acting CEO Jay Flatley, who is also currently Zymergen's chairman and Illumina, Inc.'s former CEO.[1] After Zymergen's stock prices crashed, investor Cathie Wood began buying up its shares, which raised prices again.[25]

In the wake of these financial issues, the company began restructuring to cut costs, including renegotiating loans, laying off hundreds of employees, and restructuring lease expenses for office space. The company's founder Jed Dean also left the company.[26][27] In November 2021, Zymergen announced that it had abandoned the production of Hyaline, and would be focusing on drug and vaccine development.[28] The company's highly publicized difficulties in bringing its projected products to market and financial issues drew comparisons to other biotechnology companies such as Theranos.[10][2]

In July 2022, Ginkgo Bioworks agreed to acquire Zymergen for $300 million in an all-stock deal.[29]

On October 3, 2023, Zymergen filed for Chapter 11 bankruptcy.[30] On February 5, 2024, Zymergen announced that it would liquidate after selling all of its remaining assets and employee layoffs.[31]

References

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  1. ^ a b Levy, Ari (2021-08-04). "Synthetic biology company Zymergen plunges 68% after saying product revenue will be 'immaterial' in 2022, removing CEO". CNBC. Archived from the original on 2021-08-04.
  2. ^ a b c d Feldman, Amy; Au-Yeung, Angel (2021-10-13). "The Inside Story Of How SoftBank-Backed Zymergen Imploded Four Months After Its $3 Billion IPO". Forbes. Archived from the original on 2021-10-13.
  3. ^ "Board of Directors". Zymergen. 19 October 2022.
  4. ^ "ソフトバンク、米バイオVBに投資". 日本経済新聞 (in Japanese). 2016-10-12. Archived from the original on 2016-10-17.
  5. ^ Buhr, Sarah (2015-06-16). "With $44 Million In Funding, Biotech Startup Zymergen Is Buying Up Robots To Mass Produce Materials From Microbes". TechCrunch. Archived from the original on 2015-06-16.
  6. ^ a b Leitão, Dantas, José Guilherme; Cagica, Carvalho, Luísa (2020-02-25). Handbook of Research on Approaches to Alternative Entrepreneurship Opportunities. IGI Global. p. 42. ISBN 978-1-7998-1983-7.{{cite book}}: CS1 maint: multiple names: authors list (link)
  7. ^ a b c Feldman, Amy. "In An Earth Day Test For Synthetic Biology Field, Zymergen Raises $500 Million In IPO". Forbes. Retrieved 2022-01-10.
  8. ^ "A new breed of scientist, with brains of silicon". www.science.org. Retrieved 2022-01-11.
  9. ^ Medicine, National Academies of Sciences, Engineering, and; Studies, Division on Earth and Life (2019-07-07). Fostering the Culture of Convergence in Research: Proceedings of a Workshop. National Academies Press. p. 14. ISBN 978-0-309-48495-4.{{cite book}}: CS1 maint: multiple names: authors list (link)
  10. ^ a b Leuty, Ron (September 30, 2021). "The rise and fall of Zymergen: Can biotech veteran Jay Flatley save the company?". www.bizjournals.com. Retrieved 2022-01-10.
  11. ^ Terry, Mark (2015-12-02). "What You Need to Know About Zymergen". BioSpace. Archived from the original on 2019-05-01.
  12. ^ Buhr, Sarah (2016-10-10). "Biotech startup Zymergen nabs $130 million from Softbank". TechCrunch. Archived from the original on 2016-10-11.
  13. ^ "How Bio Startup Zymergen Plans to Spend $400M". www.bloomberg.com. December 14, 2018. Retrieved 2022-01-11.
  14. ^ Loizos, Connie (2018-12-13). "Zymergen lands $400 million more, led by SoftBank Vision Fund, for its genetically altered microbes". TechCrunch. Archived from the original on 2018-12-13.
  15. ^ Schieber, Jonathan (2020-09-09). "Zymergen raised $300 million because synthetic biology is so hot right now". TechCrunch. Archived from the original on 2020-09-09.
  16. ^ Konrad, Alex (2016-10-11). "Why SoftBank Just Led A $130 Million Mega Round Into Zymergen's Microbe-Creating Robots". Forbes. Archived from the original on 2016-10-12.
  17. ^ "Zymergen Acquires Radiant Genomics". Genomeweb. 2018-01-08. Archived from the original on 2019-05-14.
  18. ^ a b Hytha, Michael (April 22, 2021). "'Biofacturing' Firm Zymergen Raises $500 Million in Expanded IPO". www.bloomberg.com. Retrieved 2022-01-10.
  19. ^ Voigt, Christopher A. (2020-12-11). "Synthetic biology 2020–2030: six commercially-available products that are changing our world". Nature Communications. 11 (1): 6379. doi:10.1038/s41467-020-20122-2. hdl:1721.1/133601.2. ISSN 2041-1723.
  20. ^ Renauer, Cory (2021-04-27). "This Is Why Zymergen's IPO Was a Huge Success". The Motley Fool. Retrieved 2022-01-10.
  21. ^ Levy, Ari (2021-08-04). "Synthetic biology company Zymergen plunges 68% after saying product revenue will be 'immaterial' in 2022, removing CEO". CNBC. Retrieved 2023-08-22.
  22. ^ "CEO exits as fast-growing, newly public East Bay synthetic biology company's first product flops". San Francisco Business Times. Retrieved 2023-08-22.
  23. ^ "SoftBank-Backed Zymergen Craters by Record After CEO Leaves". Bloomberg.com. 2021-08-04. Retrieved 2023-08-22.
  24. ^ Beltran, Luisa. "Shares of Synthetic Biology Hopeful Zymergen Plunge as CEO Departs". www.barrons.com. Retrieved 2022-01-10.
  25. ^ Flanagan, Cristin (August 5, 2021). "Zymergen Can Thank Cathie Wood for Its Head-Spinning Rebound". www.bloomberg.com. Retrieved 2022-01-10.
  26. ^ "Synthetic biology company Zymergen to cut 120 jobs after 1st product falters". www.bizjournals.com. Retrieved 2022-01-10.
  27. ^ "Troubled Zymergen renegotiates loan, cuts 100 more jobs and loses co-founder". www.bizjournals.com. Retrieved 2022-01-10.
  28. ^ "Zymergen ditches products, targets agriculture, vaccines, drugs as cost-cutting continues". www.bizjournals.com. Retrieved 2022-01-10.
  29. ^ Saul, Derek (25 July 2022). "Ginkgo Buys Embattled Biotech Firm Zymergen For Paltry $300 Million". Forbes. Archived from the original on 26 July 2022.
  30. ^ "Ginkgo Bioworks Unit Zymergen Filed for Chapter 11 Bankruptcy". Bloomberg. October 3, 2023. Retrieved October 3, 2023.
  31. ^ "Ginkgo Bioworks Unit Zymergen to Liquidate After Selling Assets". Bloomberg Law. February 5, 2024. Retrieved March 17, 2024.
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