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Biotech investors are getting a new opportunity with a company called Berkeley Lights. It's a cell biology company that specializes in discovering new cell therapies.
And to help you make an informed decision on whether to invest in the Berkeley Lights IPO, we're going to take a deep dive into the company and its prospects.
The hype for the Berkeley Lights IPO just keeps rising. After setting the terms of its oncoming IPO, it said it plans to raise $126 million. The next day, it said it was targeting $133 million. Now, it could be expecting a $153 million IPO.
Ultimately, the company could be valued at $1.1 billion at IPO date.
Before we get into whether you should buy Berkeley Lights stock, let's talk about why the company is on the cutting edge of biotechnology...
What Is Berkeley Lights?
Berkeley lights was founded in 2011. Fast Company named it one of the world's most innovative companies last year. The Berkeley Lights ticker will be BLI.
Broadly speaking, Berkeley Lights finds new therapies and medication for cell manipulation. Its areas of research include antibody discovery, cell line development, cell therapy development, and synthetic biology. One common example of antibody discovery is finding new antibodies to treat COVID-19 patients, for example. That's linked to different kinds of cell therapy - Berkeley has an end-to-and platform that covers it all.
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Its technology includes a digital platform for exploring cells and studying their behavior using lights - hence the name. This kind of innovation literally helps find the "best" cells for use of cell-based pharmaceuticals.
Science has just broken the ice when it comes to stem cell research. As the sector innovates and FDA regulation changes around new cell-based products, it will benefit stocks like Berkeley Lights. As more companies get involved in cell-based research, more will look to use Berkeley Light's services to help carry it out.
Now, here's how you should be thinking about Berkeley Lights stock as we await the IPO...
Is Berkeley Lights Profitable?
This company's technology benefits the "real world" in the form of cancer treatments and treatments for other tough to fight diseases. Tied to this is the global stem cell market, which was valued at $7.4 billion in 2017 but is expected to double to $14.8 billion in 2022. By 2027, Grand View Research predicts it will hit $17.9 billion.
We said earlier that Berkeley Lights has no shortage of funding rolling in from investors. It has also given underwriters JPMorgan Chase & Co. (NYSE: JP), Morgan Stanley (NYSE: MS), and Cowen options to buy shares that could end up raising the company $153 million instead of $133 million.
The company's potential $1.1 billion market cap will come from its clientele of more than half the world's top 20 biopharmaceutical companies. They have all implemented Berkeley Light's technology.
As with all biotech stocks, Berkeley Lights continues to spend on research. The question is whether or not its foothold in the biopharmaceutical market can raise it to profitability.
The Berkeley Lights IPO looks promising, and BLI looks promising as a company. But IPOs aren't for everyone. They are more volatile than established stocks and are an exit for early investors ready to cash out.
But you don't have to wait for an IPO to get in on the ground floor of exciting new companies. There is a way you can start buying some stocks pre-IPO...
How to Invest in Startups Before the IPO
In 2012, Congress passed the Jumpstart Our Business Startups (JOBS) Act. This was meant to open the door for individuals to start investing in startups.
It is what it sounds like. The JOBS Act made it so that virtually anyone could become an angel investor.
You no longer have to be a multimillionaire business mogul to get into pre-IPO investing. This new legislation made it possible for investors to put money into companies before they go public.
And the potential for startup investing is astronomical.
If you had a fractional share of Amazon.com Inc. (NASDAQ: AMZN) before it went public, you'd have a 17-million-percent return. That's $170,000 for every dollar invested in Amazon.
The only problem is - how would you pick the next Amazon? That's what the Angels & Entrepreneurs Network is about. Uncovering new opportunities in the startup market that most IPO investors can only dream of.
Here's how you can access startups before they become stocks....
How to Look for Low-Cost, High-Potential Opportunities Outside the Stock Market
In this kind of financial turbulence, we recommend you pad your portfolio with opportunities that live outside of the greater markets.
That's why we've brought in these two experts to show you the ropes.
About the Author
Mike Stenger, Associate Editor for Money Morning at Money Map Press, graduated from the Perdue School of Business at Salisbury University. He has combined his degree in Economics with an interest in emerging technologies by finding where tech and finance overlap. Today, he studies the cybersecurity sector, AI, streaming, and the Cloud.