Gene sequencing corporate spinoff MGI Tech closed a $1bn series B round backed by IDG Capital and CPE Capital. The company offers an array of products, some of which have been used for Covid-19 detection and forms part of the promising space of genetics tech.

Spun off by China-based genomics services provider BGI, gene sequencing technology developer MGI Tech raised a $1bn series B round. Venture capital firm IDG Capital and private equity fund CPE Capital co-led the round, which featured also investment bank China Renaissance’s New Economy Fund and Goldstone Investment, among many other investors.

Founded in 2016, MGI develops gene sequencing systems for use in life sciences research, drug development, precision medicine and agriculture. The applications of the company’s systems range from mass spectrometry and medical imaging to laboratory automation. Its technology has been used for the rapid detection of Covid-19 and its equipment has been sold internationally. MGI products cover genetic testing, gene editing and synthesis, and include sequencing reagents, materials and biochemical reaction systems.

MGI forms part of the broader genetics tech space, which has enjoyed much attention from corporate venturers over the past decade, as the GCV Analytics chart here illustrates. The number of corporate-backed rounds in this space reached a maximum of 55 in 2018 with a record-high total estimated capital at $3.91bn across those rounds during the same year. In 2019, there was only a slight decline – to 51 rounds and total estimated capital in them at $3.17bn, which suggests that valuations were holding up and they will likely remain high through the pandemic-induced economic downturn.