Kestrel Biologics, the gene-therapy company spun out of a Kincaid University lab, announced a $64 million funding round Wednesday that its executives say will fund a doubling of its Foundry Row workforce over the next two years.
The Series C round, led by a pair of out-of-state venture funds with participation from returning investors, values Kestrel Biologics at roughly $310 million, according to figures the company shared with the Times. Chief Executive Elena Marchetti said the funding would go toward expanding the company’s footprint at Forge Bellwater, the converted-warehouse incubator on Foundry Row where Kestrel has leased lab space since spinning out of Kincaid University five years ago.
“When we started, we had four people and one lab bench,” Marchetti said. “Now we’re looking at nearly 200 employees in Bellwater within two years, assuming we can find them.” The company plans to add roughly 150 positions, split between laboratory scientists, manufacturing technicians and regulatory-affairs staff, as it advances two gene-therapy candidates toward later-stage clinical trials.
From a university lab to a $310 million company
Dr. Wei-Lin Tan, the Kincaid University researcher whose lab produced the science behind Kestrel’s founding technology, said the funding round validates a bet the university made when it first backed her efforts to commercialize gene-therapy research rather than license it away. “There was a real argument, years ago, for selling the underlying patents to a bigger company and letting them build it somewhere else,” Tan said. “Kincaid decided to help us build it here instead.”
Kincaid President Dr. Howard Faircloth said the university has leaned into that strategy since, establishing a technology-transfer office specifically to help faculty researchers spin out companies rather than simply publish and move on. “Kestrel is the proof of concept for what we’re trying to build institutionally,” Faircloth said. “We want three or four more of these in the next decade, not just one.”
We used to lose our best graduate researchers to labs on the coasts the moment they finished their postdocs. Now some of them are staying to work three miles from campus instead.
Dr. Wei-Lin Tan, Kincaid University
Hiring runs into a familiar problem
Marchetti said the company’s biggest constraint isn’t capital or lab space but qualified local hires, particularly for manufacturing and quality-control technician roles that don’t require a doctorate but do require specialized training Bellwater’s schools have only recently begun offering at scale. Kestrel currently recruits roughly 40 percent of its technical staff from outside the metro area, a share Marchetti said she wants to cut significantly.
Dr. Samuel Iyer, a labor economist at Bellwater State University who studies the region’s manufacturing decline and tech-sector growth, said Kestrel’s hiring plans illustrate a gap that has shadowed Bellwater’s recovery for years. “We built an economy around factory work that didn’t require a four-year degree, lost most of it, and now we’re building a biotech and clean-energy economy that mostly does,” Iyer said. “The people who most need these jobs are often the least equipped, through no fault of their own, to walk into them.”
Iyer pointed to changes underway at Bellwater State University, where enrollment has shifted toward biotech and lab-sciences programs in recent years, as one sign the pipeline is starting to catch up with demand, though he cautioned it would take several more graduating classes before the effect shows up meaningfully in local hiring numbers.
Growth with a cost
Theresa Nakamura, executive director of the Bellwater Chamber of Commerce, called the funding round “exactly the kind of momentum we’ve been chasing since the factories closed,” noting that Kestrel’s expansion would likely draw additional biotech firms and suppliers to Foundry Row. But she acknowledged the growth carries a cost for the neighborhood’s affordability, particularly as Foundry Row’s transformation draws scrutiny over housing.
That tension has surfaced directly in a pending lawsuit over affordable-housing commitments at a nearby apartment development, where tenants allege a developer failed to deliver income-restricted units even as higher-earning biotech workers moved into the area. Marchetti said Kestrel has no formal role in the dispute but acknowledged the company’s growth is part of the broader pressure on Foundry Row rents.
“I don’t think it’s fair to ask a biotech company to solve the city’s housing policy,” Marchetti said. “But I also don’t think we get to pretend our hiring has nothing to do with what’s happening to rents three blocks from our building.”
Nakamura said the chamber has begun convening quarterly meetings between Foundry Row employers, including Kestrel and rival biotech firm Ridgeline Therapeutics, and workforce-training providers to try to align hiring needs with the skills programs coming out of the community college and Bellwater State. “Nobody wants a repeat of what happened after the mills closed, where the jobs and the workforce training showed up on completely different timelines,” she said.
Marchetti said Kestrel expects to begin its first wave of new hiring within the quarter, with an initial focus on manufacturing technicians for its expanded production line. The company’s next clinical trial milestone, for its lead gene-therapy candidate, is expected within the next year, a result Marchetti said would determine how much of the new funding gets deployed toward Bellwater versus a planned second facility the company has not yet located.
Tan said she has fielded a growing number of calls from graduate students asking how to structure their own research toward eventual commercialization rather than a traditional academic career track, a shift she said would have seemed unlikely a decade ago. “I used to have to convince people that staying in Bellwater wasn’t a step down,” she said. “Now I have people asking me how to do what I did.”
Faircloth said Kincaid is exploring an expanded lab-space lease at Forge Bellwater specifically to give early-stage faculty spinouts room to grow before they need to raise outside capital, modeled in part on the runway Tan’s lab had in its earliest years. He declined to name specific projects under consideration but said the university expects to announce at least one new spinout effort within the coming year.