{ "docId": "019dd923-622c-750b-8b99-1329de4989df", "docSlug": "da9f1a22e4af", "documentTitle": "Danimer Scientific (DNMR)", "authorId": "54_Spruce_Point_Capital", "authorName": "Spruce Point Capital Management", "documentKindSlug": "activist-deck", "documentKindLabel": "Activist deck", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2021-04-22 00:00:00", "orientation": "landscape", "aspectRatio": 1.3333334, "pageNumber": 50, "pageCount": 63, "prevPage": 49, "nextPage": 51, "slideType": "ceo_quote", "function": "expose_contradiction", "density": "dense", "nDataPoints": 4, "notes": "The slide uses a direct quote to undermine the target company's business model.", "elementsJson": [ "headline_text", "paragraph", "quote_block", "footnote" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b99-1329de4989df/50", "deckHref": "/decks/019dd923-622c-750b-8b99-1329de4989df", "deckJsonHref": "/decks/019dd923-622c-750b-8b99-1329de4989df.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b99-1329de4989df#slide-50", "components": [ { "bbox": null, "kind": "callout", "text": "An interview with a Senior Executive at a Danimer competitor reveled there will likely be challenges to scale within the trillion-dollar plastics industry. In addition, Danimer’s reliance on canola oil looks to be a competitive disadvantage compared to lower priced alternative inputs.", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd953-3f41-721f-9e52-71c2b08132f0", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.065, "w": 0.96, "x": 0.02, "y": 0.175 }, "kind": "paragraph", "text": "An interview with a Senior Executive at a Danimer competitor reveled there will likely be challenges to scale within the trillion-dollar plastics industry. In addition, Danimer's reliance on canola oil looks to be a competitive disadvantage compared to lower priced alternative inputs.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "ee7795f6-29dc-4468-901c-1275e09ace9b", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.55, "w": 0.785, "x": 0.195, "y": 0.315 }, "kind": "quote", "text": "So even though Danimer is building... there's still a massive question mark around whether or not the science is able to play at that massive scale... I would imagine that they're considerably higher than that per pound than us because of the canola reliance.", "attrs": null, "subkind": "testimonial", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "49f902e4-a89a-4126-8f5a-a227ab9529e3", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "\"So even though Danimer is building, well so they've built a commercial production facility, they're building more capacity. The trick is going to be taking on the petrochemical behemoths, your OPEC, BP, INEOS, Exxon, Dow Chemicals of the world that are able to price risk appropriately for a $1 billion investment in a petrochemical manufacturing facility in India that produces an order of magnitude, 10, 20, 30x the amount of material that Danimer's existing scale sits at, right? And so there is still a massive scale jump to actually take on the trillion-dollar plastics market. And so the idiosyncrasies in scaling a biochemical now or living chemistry-based process to that scale, it's certainly been done with wastewater treatment. It's going to have to be done with alternative protein production, but there's still a massive question mark around whether or not the science is able to play at that massive scale. And if it doesn't, then you're always going to be stuck in each product land, right, because you're never going to be able to bring those cost profiles down to the point where you can attack, commoditize polyolefins. And so that is the direction of questioning that I would go, if I were you, is to really, really dig in on what is their scale methodology? Does the biochemistry and bacteria-powered science work at that scale? How can you prove that? What are some of the red flags that has been shown in the past? So we could talk about that if you're interested. But that would be the direction that I would go in. The question should be where we started, which is in 5 to 8 years, are they going to be able to hold that position given their reliance on canola oil and seemingly an IP portfolio that isn't all that defensible? On their side? It would be a bit of a finger in the air, but we are able to model with feedstock pricing, what it is for us well below a dollar a pound, somewhere between $0.30 and $0.60. And I would imagine that they're considerably higher than that per pound than us because of the canola reliance.\" — Senior Executive, Danimer Competitor", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd953-3f41-721f-9e52-7771ec9cc3af", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.02, "w": 0.08, "x": 0.02, "y": 0.97 }, "kind": "source-note", "text": "Source: Tegus", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "e050218a-d112-4a84-8fa4-57ba337b75cd", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.045, "w": 0.488, "x": 0.306, "y": 0.05 }, "kind": "title", "text": "Unsustainable Competitive Advantage", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "d12f7936-324d-4d1a-9ff2-0488b86fbcfe", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "ceo-quote-contradiction", "slug": null, "matchId": "5ff62e54-a933-4fd5-bfa2-7cddb5f50e71", "evidence": "Uses a competitor's quote to highlight flaws in the target's business model.", "confidence": 0.9 } ], "arcBeats": [], "loops": [], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }