With $125M Windfall, 10x Genomics Continues Gold Rush

Jack Murtha
MAY 01, 2018
10x genomics,genomics funding,genomics gold rush,hca news

The past few years have not been challenging, at least on the money front, for genomics start-ups. Venture capital has poured into the field, filling the war chests of ambitious young companies that aim to personalize and transform healthcare. The latest: Last week, 10x Genomics, an organization bent on boosting genomic discovery, received a total of $125 million for its pioneering work.

The influx of cash represents a shot in the arm of a market that is poised to see explosive growth over the next several years. Although analysts disagree about how much value the genomics sector will accrue, and how quickly, they peg the number to be as large as $24 billion by 2022. The bullish outlook hinges on an unfolding evolution in medicine—and the many components of genomics, among them gene editing, precision medicine, and various forms of testing, to name a few.

10x Genomics operates in the genomic discovery space, producing products that enable single-cell DNA sequencing for oncology, single-cell multiomic measurements of proteins and gene expression, and single-cell epigenomic analysis. Those tools account for some of the start-up’s newest offerings, but since its founding in 2012, 10x Genomics has aggressively pursued the development of technologies that aid scientific discovery regarding biology and disease, according to the company.

>> LISTEN: The Gene-Editing Company That Didn’t Need CRISPR

Its recent windfall came in the form of $50 million in Series D financing, led by Meritech Capital Partners and with support from Wells Fargo Strategic Capital, Paladin Capital, Fidelity, and the SoftBank Group. The genomics company locked down another $75 million in credit from Silicon Valley Bank, for the $125 million total, according to an announcement.

But the successful fundraising blitz isn’t owed to glitz. Since mid-2015, 10x Genomics had earned more than $100 million in revenue, with 150% increases year over year, the company noted. It launched 25 products—instruments, reagents, and software—in its first 30 months of sales.

“We invest exclusively in late-stage companies with big potential,” said Craig Sherman, managing director of Meritech Capital, a new backer. “10x has had a remarkable record of brilliant execution in the service of an ambitious vision. It is rare to see a company with this much existing success as well as massive potential to impact the world in a positive way.”

So, 10x Genomics may indeed be a special case, but its story is representative of the opportunity embedded into the genomics space. Indeed, other big companies, such as Sangamo Therapeutics, which recently inked a $3 billion partnership, have seen money continue to flow in as they grow. For young up-and-comers, often inspired by sizable early investments of their own, these stories stand as monuments to what could be.

Experts previously contacted by Healthcare Analytics Newshave cautioned that the genomics financing frenzy has actually cooled, compared to where it was in the early and mid-2000s. But they said there was no reason to believe funding will dry up anytime soon.

For 10x Genomics, big funding and credit lines will translate to more innovation and the development of “strategic opportunities.” The new money is also slated to boost its global expansion and manufacturing capabilities.

“We have been fortunate to achieve leadership positions across multiple scientific fields in a short amount of time,” noted Serge Saxonov, PhD, CEO and co-founder of 10x Genomics. “The really exciting thing is that we are just getting started.”

And the genomics space itself appears to be just getting started as well.

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