Platform biotech · Synthetic biology
Ginkgo Bioworks
A cell engineering platform that went public in 2021 at a $15 billion valuation, was accused of accounting fraud by a short seller nineteen days later, and has since shrunk to under 500 people building robotic laboratories. The filings tell the story better than either side of the argument.
Nineteen days after the bell
Ginkgo Bioworks had been a listed company for less than three weeks when Scorpion Capital published 175 pages about it. The report, dated October 6, 2021, called Ginkgo “a colossal scam” and, in the phrase that travelled furthest, “a hoax for the ages.” Within about an hour the stock fell at least 20 percent, to roughly $9.50 a share, a price that predates the one for forty reverse split of 2024.
The allegation was about who Ginkgo's customers were. Citing interviews inside those customers, Scorpion wrote that “at least half of Ginkgo’s reported foundry revenue is phantom”: money that left Ginkgo's bank account as an equity investment in a company it had helped create, then returned as payment for laboratory work.
Ginkgo's audit committee hired the law firm Milbank and the forensic accounting firm Ankura. On November 15, 2021, the company told investors that the review “has concluded and found that any suggestion of fraud, reporting violations, accounting errors, or other wrongdoing contained in the short seller’s report were unfounded and that no restatement of Ginkgo’s financials was needed.” No restatement has been filed since.
What the company was built to do
Ginkgo's premise is that biology is a manufacturing platform and that the bottleneck is throughput: how many engineered cells you can design, build and test in a week. So it built foundries, rented to customers who wanted a yeast that makes a peach lactone or a microbe that makes an enzyme. The falling cost per engineered cell it named Knight's Law, after its oldest founder.
The gap critics kept pointing at was between platform and product. In August 2021, six weeks before the short report, MIT Technology Review noted that thirteen years in, Ginkgo could not name a single significant product manufactured and sold using its organisms. Three fragrance molecules had reached commercial fermentation. “I think flavors and fragrances is very far from the vision that biology can make anything,” the Harvard geneticist George Church told the magazine.
Five people from MIT
Ginkgo started in a Cambridge apartment in 2008: Reshma Shetty, Jason Kelly, Barry Canton, Austin Che and their adviser Tom Knight, a computer architect turned biologist often called a father of synthetic biology. “we had $150,000 and a U-Haul,” Kelly later said.
The early money was federal: National Science Foundation awards from a $99,981 Phase I in 2009 to a Phase II that grew to $1,314,964, and a 2013 NIH award of $150,000. In 2014 Ginkgo became the first biotech company through Y Combinator, and the private valuation reached about $1 billion by 2017 and $4.86 billion by 2019, per PitchBook figures cited by MIT Technology Review and CNBC.
From $23 billion to $631 million
On May 11, 2021, Soaring Eagle Acquisition Corp., the seventh blank check vehicle from former MGM chief Harry Sloan, agreed to merge with Ginkgo in a deal CNBC valued at $17.5 billion, including a $15 billion valuation for the company. Ginkgo took the ticker DNA, once Genentech's, and by the eve of the short report its market value was $23.6 billion.
Then the arc bent. Revenue peaked at $477.7 million in 2022 on pandemic era testing, fell to $251.5 million in 2023 as school testing wound down, and has declined every year since. In June 2024 Ginkgo began a restructuring that a securities filing put at 35 percent or more of the workforce. In May 2024 the NYSE notified it that its stock had averaged under $1 for thirty trading days; in August it executed the reverse split. Headcount fell from 1,292 at the end of 2022 to 485 at the end of 2025. Market value on September 16, 2026 was about $631 million.
In February 2026 Ginkgo agreed to hand its biosecurity business to Tower Biosecurity, Inc. for about 20 percent of the buyer; that closed on April 3, 2026. What remains sells autonomous laboratories: robot carts, scheduling software, and a Boston cloud lab called Nebula.
What is proven, and what is still claimed
| Evidence | What the record shows | Source type |
|---|---|---|
| Revenue | $76.7M (2020), $313.8M (2021), $477.7M (2022), $251.5M (2023), $227.0M (2024), $170.2M (2025). Q2 2026 continuing operations revenue was $20M. | Public record |
| Related party revenue | Per the audited statements: $42.5M of $59.2M of foundry revenue in 2020, or 72 percent of that line. Then $47.2M (2021), $38.8M (2022), $22.2M (2023), $53.0M (2024), $8.8M (2025). | Public record |
| The short seller’s claim | October 6, 2021: that Ginkgo was a shell game, that related parties drove the bulk of revenue, that new R&D partners were undisclosed related parties, and that revenues were overstated. | Short seller |
| The company’s answer | Audit committee investigation by Milbank and Ankura, reported concluded November 15, 2021, finding the claims unfounded and no restatement needed. | Company-stated |
| Regulators | The 10-K discloses a preliminary and informal Department of Justice inquiry shortly after the report. The fiscal 2022 and 2023 10-Ks state the SEC confirmed it concluded its inquiry, begun in October 2021 or soon after, with no recommendation of enforcement action. No DOJ outcome appears in any filing found. | Public record |
| Securities class action | Bernstein v. Ginkgo Bioworks Holdings, filed November 18, 2021, N.D. Cal. The motion to dismiss was granted in part and denied in part on March 10, 2023. Settled for $17,750,000, final judgment December 16, 2024. A settlement is not a finding of liability. | Public record |
| Derivative actions | Federal and Delaware derivative suits settled on a stipulation dated May 27, 2025: insurers pay Ginkgo $4,125,000 and the board adopts governance and internal control reforms for at least three years. | Public record |
| Peer reviewed output | PubMed ties Ginkgo Datapoints to two MAbs papers: an antibody developability platform (2025) and the outcomes of its own competition (2026), whose title reports limited model performance. | Public record |
| Products on the market | Three fragrance molecules in commercial fermentation as of 2021, two confirmed by Robertet's US chief. No later count of marketed products was found. | Not found |
Read plainly: the related party concentration the short seller attacked was disclosed in Ginkgo's own statements and had been reported independently before Scorpion published. What the record does not contain is a finding of fraud. The SEC closed without recommending enforcement, no restatement was filed, and both cases ended in payments and reforms rather than admissions. What it does show is a business that kept shrinking.
What to watch
- Whether autonomous lab orders convert into revenue. Named so far: a $47 million system for Pacific Northwest National Laboratory and NSF funded university builds.
- Cash. Guidance is $125 million to $150 million of burn in 2026 against $302 million on hand at June 30.
- The carrying value of the roughly 20 percent stake in Tower Biosecurity.
- Whether the derivative settlement reforms change how related party deals are approved and disclosed.
- Any disclosure resolving the 2021 Department of Justice inquiry, which no filing reports as closed.
In their words
“I am not a product company, and I have no desire to be a product company.”
Jason Kelly, co-founder and CEO, MIT Technology Review, 2021 · Independent
“It looks like a great example of a clever story that caught the attention of investors.”
Jean-François Formela, Atlas Venture, on the valuation, MIT Technology Review, 2021 · Independent
“at least half of Ginkgo’s reported foundry revenue is phantom”
Scorpion Capital report, quoted by Fierce Biotech, October 2021 · Short seller
“Our focus at Ginkgo is increasing the scale of our platform so we can deliver more cell programs to customers.”
Jason Kelly to Fierce Medtech, the day the report landed, 2021 · Company-stated
“This investigation has concluded and found that any suggestion of fraud, reporting violations, accounting errors, or other wrongdoing contained in the short seller’s report were unfounded and that no restatement of Ginkgo’s financials was needed.”
Ginkgo earnings release, November 15, 2021, quoted by The D&O Diary · Company-stated
“provided new information that was not previously reflected in the stock price.”
The district court on the Scorpion report, March 2023, as quoted by Pomerantz LLP, class counsel · Court order
“You should think of it as a team, except instead of your team being a team of humans, it’s now a mixture of humans and AI agents.”
Reshma Shetty, co-founder and president, R&D World, February 2026 · Interview
“This year, we are going to focus on investing to win in the category of autonomous labs.”
Jason Kelly, fourth quarter 2025 results, February 26, 2026 · Company release
Related companies
Sources
- Public recordForm 10-K, fiscal 2025
- Public recordForm 10-K, fiscal 2024
- Public recordForm 10-K, fiscal 2021 and fiscal 2022
- Public recordForm 10-Q and Exhibit 99.1, quarter ended June 30, 2026
- Public recordFourth quarter and full year 2025 results, Exhibit 99.1
- Public recordSecurities Class Action Clearinghouse case page
- Public recordNotice of proposed settlement, $17,750,000 fund
- Public recordSummary notice of settlement of derivative actions
- Public recordNSF SBIR awards 0912541, 1113506, 1256446
- Public recordNIH RePORTER 1R43TR000616-01, NCATS
- IndependentIs Ginkgo’s synthetic-biology story worth $15 billion?
- IndependentGinkgo Bioworks ‘a hoax for the ages,’ says activist short seller firm
- IndependentShareholders Sue Post-SPAC-Merger Biotech Firm After Short Seller Attack
- IndependentPomerantz Finalizes Settlement on Behalf of Ginkgo Bioworks Investors
- IndependentGinkgo job cuts to hit at least 35% of workforce
- IndependentBill Gates-backed Ginkgo Bioworks going public via $15 billion SPAC
- InterviewReshma Shetty on autonomous labs and AI-designed experiments
- Market dataDNA stock overview
- CompanyAbout page and founder letter
Profile researched and written by Healthcare Discovery. Last updated September 29, 2026.
