Preston “Cinco” Plumb says he had no thought of expanding beyond San Diego, much less the United States, seven years ago when he bought a business that buys and sells used biotech equipment. Since then, he says BioSurplus sales have grown by five times, and the company has expanded to Fremont, CA; Incheon, South Korea; and Boston.
Plumb sought outside funding for the first time this year, targeting $1.5 million to fund expansion planned for Boston. BioSurplus said in May it had raised most of that from San Diego-based KI Investment Holdings. But the company’s first round became a fast-growing target. Today BioSurplus is announcing the close of its Series A financing—raising a total of $2.4 million—with Durham, NC-based SJF Ventures accounting for much of the now-oversubscribed round.
The additional capital “doesn’t really change our strategy, but it allows us to expand faster,” Plumb tells me. “In Boston, we’re months ahead of where we would be if we’d just tried to grow organically.”
As a result, BioSurplus is seeking to fill five new positions in Boston, and is laying plans for its first Boston auction of pre-owned lab equipment next month. Part of the extra funding also could be used to expand further in the Bay Area, Plumb says. “The plan from here would be to continue to expand further. It could be other parts of the country, or internationally.”
Shops that buy and sell pre-owned specialized equipment and laboratory instruments tend to be mom-and-pop businesses, and Plumb says that’s the way it was when he acquired the company. BioSurplus began adding high-quality employees with deep scientific expertise, and Plumb says the company has developed “a tremendous amount” of cloud-based software to help the company manage what he describes as a very complex, broad, and diverse inventory. The company typically has more than 10,000 stock-keeping units (SKUs). Even two pieces of the same make and model usually require different SKUs, he says, unless they were manufactured during the same year.
BioSurplus now has about 40 employees in four locations. The company’s listings include analytical chemistry systems, autoclave sterilizers, bioreactor-fermenters, cell counting and sorting systems, centrifuges, freezers for storing biological samples, glass washer-dryers, and other tools of the biotech trade. The systemized approach enabled the company to organize an extended auction last year for more than 2,000 items offered from the shut down of Biogen Idec’s San Diego facility. The value of Biogen Idec’s equipment was estimated at $10 million at the time.
SJF Ventures specializes in cleantech, premium consumer products, and business and Web-based sectors. In a statement to be released today, SJF Managing Director David Griest says the firm’s BioSurplus deal represents the first investment from its third fund, and “aligns perfectly with our focus on capital efficient, growth stage companies offering proven solutions.”