When Biospan—a biotech firm that is studying the severe muscle disease myasthenia gravis—opened for business last year, it employed a new financial instrument that is growing in popularity among science startups: venture leasing. A report issued last month by Venture Economics, a consulting firm in Needham, Mass., finds that venture leasing in the U.S. has accounted for more than $300 million in deals from 1986 through 1988. Biotechnology firms especially have shown interest in this type of financing. Lloyd Mintz, a project manager at Venture Economics, says that although not a single biotech startup made a venture leasing deal in 1986, last year biotechs leased $8 million in equipment. To get itself started, Mountain View, Calif based Biospan leased $600,000 worth of state-of-the-art lab equipment, everything from beakers to centrifuges to a DNA synthesizer. In exchange for the equipment, Comdisco, a Chicago venture leasing company, received warrants worth 12% of...

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