Series B post-money valuation at $470 million for a biofuels startup

Ok – this I just don’t get. Somebody explain how this is possible. I am not suggesting that this company does not have a simply awesome technology and potential market upside, but how do you go to a $470million valuation within months? Is there some term-sheet gimmickry going on that I am naive about? Maybe this transaction is set up this way, specifically targeted to catch the attention of press and media?

Regardless, I wish them well. They have a great set of investors, and I believe they must have done their due-diligence.

Amyris Biotechnologies Inc., an Emeryville, Calif.-based synthetic biology company that developers renewable hydrocarbon biofuels, has closed the first tranche of a $70 million in Series B funding. DAG Ventures led the deal, and was joined by return backers Khosla Ventures, Kleiner Perkins Caufield & Byers and TPG ventures. The company raised $20 million in Series A funding last year, and named for BP executive John Melo as CEO. VentureWire quotes Melo as saying that the Series B round came with a post-money valuation of $470 million.

Source: PEWeek

Here is some more info from the Amyris website:

September 19, 2007


Prominent Investors Include DAG Ventures, Khosla Ventures, Kleiner Perkins Caufield & Byers, and TPG Ventures

Strong Endorsement of Technology Pioneer at Forefront of Developing No-Compromise Biofuels

Emeryville, CA – September 19, 2007 – Amyris Biotechnologies, an innovator in the development of renewable hydrocarbon biofuels, today announced that it closed the first tranche of its $70 million Series B funding. Duff Ackerman & Goodrich Ventures (DAG Ventures) led the financing and was joined by existing Series A investors, including Khosla Ventures, Kleiner Perkins Caufield & Byers, and TPG Ventures. The Series B funding will be used to further the development and scale up of its technology for the production of three transportation biofuels: bio-gasoline, bio-diesel, and bio-jet, and to support business initiatives to enable Amyris to bring its biofuels to market as early as 2010.

“Amyris has not only a break-through technology but a clearly defined strategy to commercialize a promising slate of next-generation biofuels that could have a profound impact on the transportation market,” said R. Thomas Goodrich at DAG Ventures. “We are investing with strong confidence in what Amyris is creating as well as the management and scientific team the company is putting in place to execute on its vision.”

“No-compromise transportation fuels derived from renewable sources hold substantial promise for meeting the tremendous need for alternative energy sources in the future,” said John Melo, CEO of Amyris. “We have already succeeded in creating these biofuels in our lab. We are delighted with the strong interest in our Series B funding which will enable us to continue the research and scale-up of our technology and to implement our business model as the first biofuels company to go from production to customer.”

Amyris pioneered a unique technology platform that allows it to use a variety of environmentally-friendly renewable feedstocks including sugarcane, corn and cellulose, to produce high-value compounds. This technology has been proven in Amyris’ earlier non-profit project, funded through a grant to the Institute for One World Health from the Bill and Melinda Gates Foundation, to reduce the production cost of artemisinin-based anti-malarial drugs. Using the same technology platform, Amyris is now developing capabilities to produce a slate of high-performing hydrocarbon transportation biofuels that are environmentally friendly, cost-effective, and compatible with current engines and distribution infrastructure.

“Amyris is designing better biofuels from designer bugs” said John Doerr, partner at Kleiner Perkins Caufield & Byers. “This is a big deal because Amyris’ cost competitive biofuels will work with existing engines without compromising performance and will have a lower carbon footprint. This financing will help Amyris scale with speed.” Amyris expects to close the second tranche of its Series B financing by the end of 2007.


2 Responses to Series B post-money valuation at $470 million for a biofuels startup

  1. I thought I wanted a career, turns out I just wanted paychecks.

  2. Bilal Zuberi says:

    Turns out I was right. Amyris just went IPO and series B investors are under water.

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