Making a New, Big Splash in the Sequencing Market

If, as monthly START-UP contributor Michael Lytton (general partner at Oxford Bioscience Partners) wrote in a recent "Nothing Ventured" column, "the first ingredient of a successful tool company deal is to invest as little capital as possible" (see "The Value in Tool Companies," START-UP, March 2004 Also see "The Value in Tool Companies" - Scrip, 1 March, 2004.), what then to make of the hefty $27 million raised by Helicos BioSciences Corp. , a developer of high-throughput sequencing systems, in its initial venture round in February? [See Deal] Only one other privately held tool company has raised more than $20 million since last September—ParAllele BioScience Inc. , also a developer of high-throughput genomics tools, in its B round last fall. [See Deal](See "ParAllele BioScience Inc.," START-UP, October 2003 Also see "ParAllele BioScience Inc." - Scrip, 1 October, 2003..)

Along with the usual arguments--the pedigree of its founders and advisers (which in Helicos' case include Leroy Hood, PhD, the...