{ "docId": "019dd923-622c-750b-8b9a-1a3bea94baf9", "docSlug": "c358888161f0", "documentTitle": "Ginkgo Bioworks (DNA)", "authorId": "58_Scorpion_Capital", "authorName": "Scorpion Capital", "documentKindSlug": "activist-deck", "documentKindLabel": "Activist deck", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2021-10-06 00:00:00", "orientation": "landscape", "aspectRatio": 1.2941177, "pageNumber": 45, "pageCount": 175, "prevPage": 44, "nextPage": 46, "slideType": "expose_contradiction", "function": "expose_contradiction", "density": "dense", "nDataPoints": 3, "notes": "The slide uses a direct quote from a prospectus to highlight a potential accounting manipulation.", "elementsJson": [ "paragraph", "screenshot", "data_table" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b9a-1a3bea94baf9/45", "deckHref": "/decks/019dd923-622c-750b-8b9a-1a3bea94baf9", "deckJsonHref": "/decks/019dd923-622c-750b-8b9a-1a3bea94baf9.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b9a-1a3bea94baf9#slide-45", "components": [ { "bbox": null, "kind": "metric", "text": "deferred revenue", "attrs": null, "subkind": "primary", "toolName": "Quantification", "toolSlug": "quantification", "confidence": null, "componentId": "019dd953-70f2-7016-81d7-fc0eaeb5b934", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.05, "w": 0.9, "x": 0.05, "y": 0.38 }, "kind": "paragraph", "text": "Prospectus indicates $77MM financing including “certain of our investors,” which appears to be in Q1 2021", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "10b0e583-0984-4946-a3ee-9a495e02631e", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.25, "w": 0.9, "x": 0.05, "y": 0.45 }, "kind": "paragraph", "text": "Kalo Ingredients, LLC Founded in 2021, Kalo Ingredients, LLC (“Kalo”) was formed to focus on the application of synthetic biology in the beauty and personal care products industry. In March 2021, we entered into an intellectual property contribution agreement that granted Kalo rights to our intellectual property, subject to mutually agreed upon technical development plans. In return for our contribution of intellectual property and access to our platform, we received common units in Kalo with a right to additional units subject to additional closings of Kalo’s Series A preferred units. The initial fair value of our common units received in Kalo was $11.9 million which has subsequently been reduced to a carrying value of zero as a result of the allocation of losses under our accounting for equity method investments. Kalo was capitalized through a Series A preferred unit financing that raised approximately $77 million in gross proceeds from an investor group which included certain of our investors and industry strategic investors. Ginkgo also entered into a Technical Development Agreement with Kalo under which we will provide R&D services in return for cash consideration on a cost-plus fixed margin basis.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "8b30e2e7-5b43-40bb-af90-51d649934ff3", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.03, "w": 0.9, "x": 0.05, "y": 0.95 }, "kind": "source-note", "text": "Source: Soaring Eagle Acquisition Corp prospectus 8/13/2021, https://www.sec.gov/Archives/edgar/data/0001830214/000119312521246097/d177007d424b3.htm; Scorpion Capital analysis and estimates", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "30ac3662-9874-491d-bc39-62ce337d6864", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.1, "w": 0.5, "x": 0.05, "y": 0.76 }, "kind": "table", "text": "in millions USD | 3/31/2021 | Revenue Ginkgo recognized from Kalo | - | Deferred revenue balance at period end with Kalo | 11,897 | Total booked as revenue and deferred revenue | 11,897", "attrs": null, "subkind": "data", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "e12eefa0-37af-478d-90ac-15b2da19c3d2", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.03, "w": 0.9, "x": 0.05, "y": 0.72 }, "kind": "title", "text": "Ginkgo immediately booked $11.9MM of deferred revenue, as of 3/3/21", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "ccf05faa-c043-4f3d-b741-7f6102616334", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.9, "x": 0.05, "y": 0.08 }, "kind": "title", "text": "Kalo Ingredients is a newly-formed related party, founded in 2021. By the end of Q1 2021, it appears to have completed a $77MM Series A investment involving Ginkgo’s investors with Ginkgo simultaneously booking $11.9MM of deferred revenue. We expect Ginkgo to sharply escalate the revenue and deferred revenue it books from Kalo, as the entire purpose of these related parties appears to be to create the illusion of “growth.”", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "f03b056d-eea3-4e99-9ddc-45c9a6bb2bdc", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "fraud-exposure", "slug": null, "matchId": "f6090e27-622b-4835-9d98-bcdca7daf604", "evidence": "The slide explicitly claims the purpose of the related party is to create an 'illusion of growth'.", "confidence": 0.9 } ], "arcBeats": [ { "to": 175, "from": 9, "beatId": "ffe290af-3a4f-4e06-8d60-dfbfc07d2e08", "arcName": "Overcoming the Monster", "arcSlug": "overcoming-monster", "beatName": "Expose Contradiction", "beatSlug": null, "evidence": "The deck presents evidence contradicting Ginkgo's claims and highlighting potential wrongdoings.", "position": 1, "confidence": 0.8, "parentBeatName": null, "parentBeatSlug": null } ], "loops": [], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }