Nautilus Biotechnology co-founders Sujal Patel and Parag Mallick. (Nautilus Photo)

Nautilus Biotechnology, a Seattle-based biotech startup led by Isilon co-founder Sujal Patel, is the most recent firm to go public utilizing a particular goal acquisition firm, or SPAC.

The deal, introduced Monday morning, will inject roughly $350 million into Nautilus, which is growing a next-generation platform to analyze the human proteome, or the physique’s full set of proteins. It values the corporate at $900 million.

The firm plans to increase $150 million as a part of a merger with Arya Sciences Acquisition Corp III, a publicly-traded SPAC sponsored by present Nautilus investor Perceptive Advisors. As a part of the transaction, Nautilus may also reel in $200 million from new and former backers via personal investments in public fairness, also referred to as a standard inventory PIPE, which is used to gas a SPAC as an additional financing spherical.

SPAC mergers have turn out to be standard options to the standard course of for preliminary public choices, providing a quicker path to going public. Also generally known as “blank check” corporations, SPACs sometimes should not have a longtime enterprise and are used to increase funds via public providing for a future merger or acquisition by a particular deadline. An estimated 219 SPACs raised $73 billion final yr, in accordance to analysis from Goldman Sachs reported by TechCrunch.

Perceptive, a prime biotech funding agency, is sponsoring the SPAC. The boards of each Arya III and Nautilus have accredited the proposed transaction, which is predicted to shut within the second quarter. The mixed firm will maintain the Nautilus identify and will likely be listed on the Nasdaq below the ticker NAUT.

“When Arya III was formed, our objective was to identify a company with the potential to successfully address a significant, unmet need in biomedical science,” Adam Stone, chief funding officer of Perceptive Advisors, mentioned in an announcement. “In Nautilus, we are combining with a company we believe has the potential to transform the field of proteomics, unlocking access to the proteome and enabling fundamental advancements in biology, human health, and medicine.”

Founded in 2016 by Patel and Stanford professor Parag Mallick, Nautilus is constructing a mixture of {hardware} and software program to extra precisely and effectively quantify the human proteome. The 70-person firm, co-located in Seattle and Silicon Valley, has an formidable plan to change the way in which therapeutics are developed, in search of to catalyze a brand new wave of medical remedy.

“We believe that a radical reinvention of proteomics is necessary,” Patel mentioned throughout an investor presentation Monday. “And we believe that Nautilus has the platform with the potential to revolutionize biomedicine.”

Patel and Mallick will proceed main Nautilus when the merger is accomplished, together with the present management staff.

Nautilus Biotechnology, a Seattle-based biotech startup led by Isilon co-founder Sujal Patel, is the most recent firm to go public utilizing a particular goal acquisition firm, or SPAC.
(Nautilus investor presentation)

While it’s now comparatively easy and low-cost to analyze a genome with a drop of blood, the identical progress hasn’t been made with the proteome — and that’s the chance Nautilus is wanting to seize with what it describes as quicker, cheaper, and extra exact proteomic applied sciences.

There are a number of use instances for the corporate’s know-how, together with therapeutics improvement and different proteomics functions. In some methods, Nautilus desires to democratize proteomics, related to how corporations resembling publicly-traded biotech big Illumina have accomplished with genomics. The firm estimates a complete addressable market of greater than $25 billion.

“We believe that this is one of the last untapped opportunities in biological science today,” Patel mentioned.

Nautilus raised a $76 million Series B spherical raised final yr led by Vulcan Capital, the multi-billion-dollar holding firm created by the late Microsoft co-founder Paul Allen. Bezos Expeditions, the VC arm of Amazon founder Jeff Bezos, additionally invested, together with Perceptive Advisors, Andreessen Horowitz, Madrona Venture Group, and others.

Andreessen, Madrona, and Vulcan participated within the PIPE, in addition to new backers resembling RA Capital Management, Ally Bridge Group, Bain Capital Life Sciences, Franklin Templeton Investments, OrbiMed, Alyeska Investment Group, L.P., and Casdin Capital.

Nautilus spent its early days contained in the Madrona workplace in Seattle. Patel is a strategic director at the agency.

Patel mentioned the SPAC provides Nautilus a extra direct path to IPO in a single step, “versus a two or three-step process with venture-backed private rounds and a traditional IPO.”

The additional money will assist speed up Nautilus’ path to commercialization deliberate for 2023. It expects to submit a non-GAAP web lack of $46 million this yr, in accordance to projections shared within the investor presentation. Revenue is predicted to develop to $183 million by 2025 however the firm will nonetheless be unprofitable with an estimated web lack of $42 million.

Last month Nautilus introduced three govt hires, together with two of Patel’s former colleagues at Isilon. Late final yr it additionally signed its first pharma partnership with Genentech for a pilot examine.

Nautilus’ SPAC deal follows a public providing final week for an additional Seattle biotech startup, Sana, which raised $587.5 million and noticed shares climb 40% on its first day of buying and selling.

Other Seattle-area corporations are getting in on the SPAC craze. In December, Seattle house providers tech firm Porch raised greater than $322 million via a merger with PropTech Acquisition Corp. Last week, wi-fi pioneer Craig McCaw’s Seattle-area SPAC Holicity merged with satellite tv for pc launch firm Astra.