Ginkgo Bioworks, Inc. H1 2021 Update Call
August 18, 2021, 4:30 PM ET
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Anna Marie:
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Good afternoon, everyone, and welcome to the Ginkgo Bioworks first half 2021 revenue update and business review. Prior to this presentation, we published a press release, and the presentation related to these materials will also be
available on our website, which is at ginkgobioworks.com/investors. Joining me today are Jason Kelly, our co-founder and CEO, and Mark Dmytruk, our CFO, to discuss an overview of our first half performance,
some recent updates, as well as Ginkgos business model and outlook. This discussion will be followed by a moderated Q&A session, and if you want to ask a question, please submit them to Ginkgo on Twitter with the hashtag #Ginkgoresults, or
by sending an email to investors@ginkgobioworks.com. During the presentation today, well be making forward looking statements which involve risks and uncertainties. We refer you to the Form S-4 that was
filed by Soaring Eagle with the Securities and Exchange Commission for further information regarding those risks and uncertainties. And with that, I am delighted to turn the call over to Jason Kelly, our
co-founder and CEO.
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Jason Kelly:
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Thanks, Anna Marie. So, welcome everybody. Its good to have you on the call today. And I want to start by saying were planning to, as weve announced, de-SPAC in mid-September, and take the company public and list it as DNA on the New York Stock Exchange. After that point, well be doing formal earnings calls. I just want to be clear, thats not what were
doing today. We really are giving you sort of an update on the first half, the things that we think are important for you to know, and then a little bit of an outlook on where we think things are going in the second half of the year with a goal of
helping you understand us better as a business.
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For many of you, this will be probably one of the first times youve had a chance to really engage with the leadership here, with me in particular. And were really excited about all the Q&A weve been seeing. So
I wanted to share a little bit just philosophically on how I think about why its important for our shareholders to understand the company deeply. In the history of Ginkgo, weve been a private company. So the last 13 years, very closely
held. We have great investors, Viking Global, Cascade, Bill Gates family office, Baillie Gifford, General Atlantic, Senator, so on. Really, really great investors, but a small group. And I think its important when people are investing in
a company to really understand what were trying to accomplish as an organization, and then also how were going to do well as a business to do it. Because every time you make that investment, it makes it easier for me to access capital
and do the things that Ginkgo is trying to do in the world.
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So, what are we trying to do? So, the goal for Ginkgo is ultimately to make it as easy to program cells as it is today to program computers. And the reason thats going to be feasible is that inside of cells is digital code in
the form of DNA. Its A, T, Cs. and Gs, not zeros and ones like a computer, but you can read this code with DNA sequencing with genomics, and you can write this code with DNA synthesis, DNA printing, a newer technology. And if you can read and
write code and the cell will run it, well, thats programming. And Ginkgos goal is to really take a page out of the tech industry, not the biotech industry, and build a horizontal platform. In other words, across all markets to enable
people to program cells.
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And we dont want to lock this technology up. We dont want it just for our own cell programs, our own applications. We want to do sort of what the operating system companies did with personal computers or the app stores
on mobile phones, or the cloud computing companies, the AWS did for launching websites. We want to make it so anybody that wants to develop a new application with engineered biology can do it easily by leveraging all the infrastructure behind
me here in Boston, our platform to do that. And so thats the world were trying to bring about, right? And so thats the goal. And someday, we want to make it easy enough that your kids could do it. So you should be deciding if you
want that to happen. Thats the first reason to invest.
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And then second is are we going to make you a lot of money doing it, right? And so that comes down to, do you like our strategy? Do you like my approach to competitive moats thatll give us pricing power over time? Do you like
the technology stack were building and the investments were making? You know, you have to understand the business to make that decision as well. And I think the key distinction there is, again, were taking a page a bit more from
tech than from biotech. So, youll hear about our app store style business model, where everybody who develops an application, and youll hear about a few of the ones in the first half of the year that have gone well and are getting
transferred to customers commercially, just like Apple would take a percent of revenues on the apps to the app store, we are going to do a similar thing for the applications developed on Ginkgos platform. So, thats a certain style of
business model, familiar in tech, a little newer to biotech. And then alongside that, were going to get paid fees while we do the work. And thats been a bit easier for people to understand.
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So if you go to the next slide, Anna Marie, Ill sort of highlight what I think will be the three takeaways Id love you to learn from todays short meeting, and then Im going to pass it to Mark Dmytruk, our
CFO. So, the first, were really, really thrilled to be upping our projections from 23 new cell programs in 2021 to 30. And just to give you a sense of scale, we ended last year with just over 50 cell programs running on the platform in
totality. So this is really a big increase in the amount of work were doing for customers. And the reason weve been able to update this is as a consequence of the progress were making for existing customers, were starting to
see inbound interest increasingly to the platform. And thats more than I think we expected at the start of the year. Its really exciting.
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Secondly, the biggest question I get from investors after if were going to make dinosaurs, which I dont know why that question gets asked, but the biggest question I get asked is how does that sort of app store
downstream value part of the business model work, right? How much is it worth when you do a typical program? How does the money come into Ginkgo? What are the different approaches? And so were going to go through three case studies from the
first half of this year that really highlight clearly the ways that works. And then the third one, not to put too fine a point on it, but the new delta variant of
SARS-CoV-2 really sucks. The CDC leaked a set of slides a couple of weeks ago. You probably saw. It highlights that the infectiousness of this variant is about twice the
original. So instead of one to two people being infected with each new case, its five to eight. Its like chicken pox, for those of you like me who had that as a kid. And so it really changes the dynamics around our biosecurity
offering.
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And so again, weve been very fortunate and were pleased to update that weve either signed or in close to near finished contracting with over $400 million in state contracts, just in the last couple months, for
K-12 testing. Thats really the sort of upside over the fall and spring semester that we could bring in through these contracts. I will highlight, youre going to hear from Mark on numbers that
were updating on for the second half outlook. Thats really what we consider to be predictable and in our control of those numbers. And so I think thats something youre going to hear from Ginkgo a lot in the future. When we
put numbers in front of you, we want them to be things that are really under our control and that we feel strongly are predictable. And then that upside on top of that, we hope to give you a little bit of information, but ultimately youll have
to decide what you think will happen there.
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So, Im going to pass it on to Mark, whos going to dig in a little bit to our numbers. Oh, one last thing, sorry. I went through almost all of this, but I will ... I would love to highlight very importantly, Reshma
Kewalramani, the CEO of Vertex, will be joining our board and alongside Arie and Marijn, Arie Belldegrun, who is the founder of Kite Pharma, and Marijn Dekkers, who was previously the CEO of Bayer. We now have a very nice set of really deep folks in
the therapeutics industry on our board. Thats very, very important for us going forward as were going to do more and more cell programming in the therapeutics space. And we also completed the acquisition of Dutch DNA, which is a key
Codebase asset. Back to that tech stack, its something that we wanted to make sure we had exclusive for Ginkgo, so we bought that. All right, so Im going to pass it on to Mark, and Ill pick you up again in a
minute.
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Mark Dmytruk:
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Thank you, Jason, and good afternoon, everyone. Todays financial discussion is going to be focused only on revenue highlights. And as Jason mentioned, we will be filing a full set of first half financial statements with our S-1 amendment, which we would expect to be doing in the near future. So you will get sort of full P&L balance sheet details in the near future, but thats not the purpose of todays call. So in the
first half of 2021, total revenue increased to $88 million, representing growth of 180% compared to the first half of 2020. In the first half of 2021, we added 11 new cell programs through the Foundry. And as a reminder, our new cell program
count is a key KPI that were focused on, as it is really this metric that drives both Foundry revenue and potential future downstream value share.
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And also as a reminder, we only count a program when it reaches a certain expectation of scale. And we are often doing several proof of concept type programs as well at any given time, which can ultimately lead to larger paid
programs. So the 11 new programs we added in the first half of 2021 compares to nine new programs in the first half of 2020, representing 22% growth. Existing customers accounted for three of the 11 year programs, and new customers are counted for
the remaining eight. And as you saw on the prior slide, were pretty excited about some of the new logos that we brought on. Aldevron, Corteva, Biogen, et cetera. I also want to just point out that were seeing very good industry
diversification in the new programs with five of the 11 new customer programs being from the pharma and biotech industry, and the rest being diversified across other industries.
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So as a result of this program growth, Foundry revenue increased to $44 million in the first half of 2021 from $31 million in the first half of 2020, representing 41% growth. And just to give you some additional context on
that, in the first half of 2021, we supported a total of 51 active programs across 25 unique customers on our Foundry platform. So again, just an indicator of the diversification of the business model, and the fact that that diversification
continues to grow. Our new biosecurity offering also recognized $44 million of revenue in the first half of 2021, consisting primarily of service revenue from our
end-to-end COVID testing services. And finally, just to say a few words about investments that weve been making in addition to the acquisition of Dutch DNA that
Jason mentioned, we closed that on July 1. We continued our capital investments in Foundry capacity in the first half of 2021. We commissioned two new spaces in Cambridge, Massachusetts to further bolster certain technical capabilities, and we
kicked off construction of a new broad use Foundry, what we call Bioworks 6, at our headquarters in Boston. So now Id like to provide some commentary about our revenue outlook for the rest of the
year.
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Based on progress that we have seen for the rest of the year, based on progress that we have seen in the first half of the year and our pipeline for the remainder of the year, we are increasing our projection from new cell programs
in 2021 from 23 to 30. So this represents a 30% increase from our prior full year expectation and a 67% year over year growth in new programs added to our platform. And I just want to note that the majority of these incremental programs would be
added in Q4, and therefore we wouldnt expect to see an in-year revenue contribution of any significance from those incremental programs, but they give us a nice head start on next years revenue.
For bio-security, our original full year revenue projection, as you can see on the page, had been $50 million.
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As we have already achieved $44 million in the first half of the year with additional revenue in July, were now expecting our revenue to be at least $75 million for the full year. This revised outlook is based
primarily on the value of recurring support services revenue within states that have chosen to partner with Ginkgo and that have contracted with us or are in the final stages of contracting with us. The actual total potential value of these state
contracts at present is greater than $400 million during the next school year, and therefore our actual revenue in 2021 may exceed the $75 million, depending on our ability to conduct sufficient outreach to school districts, depending on
school adoption rates of concentric, our offering and depending on the volume of testing thats actually performed.
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And theres big upside here, but I also just want to point out its equally important to note that these state contracts can be paused or terminated early. And there is still, as I think everyone on this call knows,
significant uncertainty in the K to 12 testing market in general as the facts and circumstances of the pandemic change regularly. And one final comment on outlook, we currently do not and are not planning to provide guidance for downstream value
share due to just inherent unpredictability as to timing and amount. But we do expect certain programs to contribute downstream value in the second half of 2021 and flow through to the P&L. Jason is going to be talking a little bit about that in
the coming slides. And so those are my comments. Jason, back to you.
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Jason Kelly:
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Thanks, Mark. And again, yeah, hopefully that lands on you all. Again, are our focus on things that are under our control and predictable when we share numbers with you. So Im going to talk a little bit, I will highlight some
of those potential opportunities for downstream value for us. Ultimately, downstream value comes from our customers bringing products to market, not us. So at the end of the day, its not under our direct control. But we do expect across by the
end of this year, hopefully more than 80 programs on the platform. We got a nice sort of portfolio of effect of all those different programs running, and some of them at various times well be finishing. And so thats what youre
going to hear about in the second section there about downstream value and program updates. But prior to that, I wanted to mention about this idea of going from 23 to 30 programs, because for me internally at Ginkgo, thats really the thing
Im most excited about.
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Its what we really drive the team here to meet, because it does lead to more demand on the platform, which drives bigger scale in our Foundry and Codebase, our two platform assets, at least the Foundry revenue, and then
importantly, in the future value share. And so if you go to the next slide, Anna Marie. Ill highlight one of the things thats really, to me, interesting about Ginkgo is we have a view that because DNA is common code across all of life,
you should end up having sort of, again, the moral equivalent of operating systems, or programming languages, or cloud computing, common horizontal platforms for all markets, which is easy to say, but do we have evidence of it? And whats nice
about Ginkgo is I dont prove the breadth of our platform by me going off on sort of Don Quixote quest for various products in these different markets. Instead, I have to actually go out and get customers.
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And so you can see here, the build over the last five years of me on a lot of planes doing enterprise sales with the commercial team, bringing in customers across different markets, starting in things like flavors and fragrances in
the consumer space, industrials, agriculture, food, nutrition, pharma, biotech, and so on, and having today a pretty nice diversified set of markets that we operate in. And if you go to the next slide, Anna Marie. As a reminder, we make money each
time we sign one of these programs in two ways. The first, Foundry revenue on the left. For say a one to three year period, typically, while were doing a project for the customer in the lab, youre behind me, well be charging them
on a usage basis. The more we use the facility, the more they get charged. Kind of like AWS or Snowflake type of usage pricing.
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And then once were done with the project and we give them that finished strain with the genome, in other words, the code of the cell, programmed to do what they want and then a licensing agreement that says they can use it, in
exchange for that were going to get downstream value. Okay. And thats going to come in a few different forms, but royalties is one of them. Equity is another. And milestones, which well talk about in a minute. If you go to the next
slide. Just to highlight, whats great about Ginkgo is there are two separate TAMs for those types of revenue for the business. The money we get when companies are doing that one to three years of work with us is coming from their R&D
budget. They spend this money today. There are thousands of biotech companies, ag biotech, pharma biotech, chemical biotech that have teams of scientists standing at lab benches today working by hand doing this type of cell programming work that
Ginkgo would recommend that they outsource out to us.
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And that means that thats one of the markets, its that existing R&D spend. So this is a Piper report showing in 2020, about $33 billion of that sort of R&D spending that could come to us over time, if we can
migrate people to the platform. And then on the right, this is from a McKinsey report, the end applications. When you have a successful strain and it goes to market, like our customer motif in the animal free meat space and they sell hamburgers,
thats going to show up in the food and ag category here. And well make money there through our sort of app store economic by getting a piece of the value of those applications. Which of these will be most important next year, the year
after? Id say how this industry will play out is unknown.
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What I like about our position at Ginkgo, and as I did a lot of strategy games as a kid, one of the things you want to have is optionality. And whats great about Ginkgo is we can commercialize this business through both of
these TAMs. So if it so happens that for some reason things take longer to go to market or whatever, we could really lean in to that R&D focus and bring in more near term revenue via the Foundry revenue and just migrating people over. If it
turns out that we really are changing the curve on the rate that we can get products out the door, you could see us lean very heavily more and more into the royalties and the value share, and just grab every product and have them flying off the
shelf. So how it will play out, I dont have a crystal ball on that.
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But does Ginkgo have both options in our pockets? Yeah, yeah, we do. And so thats a very valuable thing for me as we build the business. If you go to the next slide. I will say one of the things thats real exciting is we
are starting to see a shift in customer behavior. Ginkgo has been a company that is basically exclusively an outbound sales company, so its a lot of shoe leather, and being on flights, and going and meeting with people and good dinners, I
guess. I was going to say bad dinners, but good dinners, and meeting people and getting deals done. And one thing thats changing as a consequence of recent progress on our deals is we are starting to see a lot more inbound interest from
customers. People that are calling us up and saying, how does it work, Jason? Whats the deal structure? How can we get on Ginkgos platform?
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That is super exciting because it really radically changes the sales cycle speed for us. And so Im really excited about that. We are seeing that both for startups and big companies. So you can see some of the partners
weve just announced, in the first half of the year, places like Anthea, which is a company to work on APIs, small, a small company funded with $70 million recently. Bolt Threads, one of the really sort of canonical companies in the
synthetic biology space doing spider silk and leather. As well as big companies. We announced our partnership with Aldevron, which was recently acquired by Danaher. It went from a $10 billion company to a $250 billion company. So as well
as our deals with Biogen and Corteva. Were seeing a shift there and thats why were updating that guidance from that sort of 23 to 30.
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Go to the next slide, Anna Marie. Okay. So I want to spend a moment on this next set of slides here, because I think, again, this is really the, if you really want to understand the potential of Ginkgo, a lot of it is embedded in
this downstream value share. And we can get this value in basically three different ways. What we call a milestone. And an example of this would be our project with Cronos or our project with Biogen, where at the end of a project, when we give you
that strain that meets a certain commercial bar, we get a bolus of value all at once. So in the case of Cronos, thats a set of shares in their company. In the case of Biogen, its dollars. But either way, it is a bolus of money at the
value at the point of success. Second one, royalties.
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So we recently, and Aldevron was recently announced, that we had a 10 fold improvement in the efficiency of the production process for vaccinia capping enzyme, which is a key ingredient in making MRNA vaccines. As Aldevron sells
that, we will get royalties every time they sell it. So that is an ongoing sort of recurring revenue stream into the future in the form of royalties. Our deal with Roche is similar when it comes to drugs that will come out of that collaboration. And
then the third category is equity. So often with smaller companies, they may prefer to pay Ginkgo in equity in the company rather than ongoing royalties. And so this is the case with Motif, as well as Joyn Bio, our joint venture with Bayer. And so
if you go to the next slide, Im going to go through these three pretty quickly, but to give you a little extra detail.
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So in the case of Cronos, we have some really nice updates from the first half of the year. This is a public filing from Cronos, they are public company, where they say theyre going to be using cultured CBG. And so you can see
on the left hand side, the top eight molecules on that chart, the first two rows, are the products that Ginkgo is contracted with Cronos to engineer cells to produce, that are yeast cells in this case, like fungal or bacterial cells, rather than
extracting them from cannabis plants. And so those eight are what were going after. That first one, CBGA, theyre saying, we expect the final productivity target for CBG to be achieved in the coming weeks. Really in the third quarter
theyre expecting to succeed commercially here. Thats a great opportunity for us. If you go to the next slide, you can see the way this deal is structured.
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So the Foundry revenue portion of this deal is about $22 million. So during the last, this project has been ongoing for the last probably two and a half years or so, weve been getting regular monthly access fees as well
as milestones along the way as we hit intermediate technical targets. And then on the right-hand side, the downstream value is in the form of a milestone
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for all eight of those molecules, you see them there. At different levels, depending on the importance of the molecule to Cronos, we get a certain amount of shares in the company. And so, at the current share price, that CBGA
milestone would be about $9 million of shares in Cronos. So thats an example of those eight milestones, what will come off the pipe as we develop these products for Cronos over time. Next slide.
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So really, really excited about this project with Aldevron. So this is a cool project for two reasons. Number one, we really got this rolling just about a year ago. So from a standpoint of the speed by which we can start to go from
an idea for a cell program to something that is going to market and giving royalties back to Ginkgo, this is very, its really great to see things move this fast. And I think this is going to be something that varies by market. Theres no
way youre going to go through a clinical trial on a drug, obviously pandemics accepting, in a year. So something like our project with Roche, which is also royalty bearing, would never finish in a year. But in this case, what Aldevron wanted
was the peak key enzyme called vaccinia capping enzyme. Its an ingredient used in the manufacturer of mRNA vaccines.
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It competes with things like Clean Cap and these sort of capping products. And its actually a great product, but its been very supply constrained. Its hard to make, for a variety of technical reasons I wont
get into today. And so what we were able to do was take the process that Aldevron was using to make this and produce it in house, and then develop a new process with new engineered cells, where we were about 10 times more efficient than their
current process. And if you go to the next slide, in exchange for licensing that strain out to Aldevron, we are getting royalties on sales in a tiered structure where the rates go up as we have further process improvements in that production process
with Aldevron. These royalty rates are meaningful.
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And for a breakthrough process improvement, in other words, like a substantial drop in price, they will far exceed the typical rates that you would get from the biopharma industry. Aldevron expects to be selling product in 2021. If
you happen to be on the call and are interested in VCE, you should call them. And I will mention, we did not receive any Foundry fees for this project. So this was done, you might remember last year we did $25 million of free Foundry work for
people that had issues or things to work on near the pandemic, and this fell into that bucket. So we did not receive Foundry revenue for this project, its all going to be downstream. But very, very excited. And very importantly, these
royalties go many years into the future. So this is a real source of recurring revenue for us, obviously during COVID, but also for really MRNA therapeutics in general.
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So its really exciting and could not ask for a better partner than Aldevron to bring this to market. Next slide. Our third case, Motif Food Works. So this one is really exciting to me, and its a big part of the reason
youre seeing all the inbound interests that I mentioned earlier for our new programs at Ginkgo. So whats exciting about Motif is this is a brand new company back in 2018 when it got started. And so they built themselves from day one on
top of Ginkgos platform. In other words, its not like Biogen where Im convincing them to migrate some work theyre doing at their own lab to Ginkgo. Motif was able to never spend a dime building out biotechnology lab
equipment. I have hundreds of millions of dollars of equipment back here that Motif just accessed on a service basis, on the next slide, Anna Marie, via these Foundry fees. So you see $19 million in 2019, $21 million, about
$40 million in Foundry revenue to Ginkgo.
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But in lieu of Motif building out an entire giant R&D team to do this work and building out a whole lab. So this was a really great investment by Motif that led to a follow-on funding
round of $226 million announced just about a month ago. And Ginkgo, typically hasnt reported on what we own in Motif, but we typically take stakes of about 30% in these sort of companies that launch on top of our platform. And so really
excited about this as a model. I think when it comes to small companies today, if they already exist, but are small, I think theyre roughly in the Motif situation, they could come on and not have to build that out. Were obviously excited
to have people migrate over. But one of the things Im really most excited about, and if you look at companies, like for example, Stripe, they really grew this way by launching startups. Shopify practically launched on Stripe.
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Thats the kind of model I see a real opportunity for and its one of the things were trying to accomplish with these 30 new programs this year in 2021. If you go to the next slide, Anna Marie. All right, go ahead.
So I mentioned this a little bit earlier, but I do want to spend just a minute on whats happening with our bio-security business. So, it really is, the CDC said its sort of a new war when it comes
to Delta. I think people should wrap their heads around that fact. And I think the key thing to keep in mind is the rate of infectiousness of Delta as a variant is five to eight, our nod of five to eight. Theres no amount of vaccination
thats going to make this thing disappear.
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So while there was a time where we said, hey, if we got our vaccination rates to X, we can do herd immunity and kind of snuff this thing out like we snuffed out previous SARS and MERS and things like that. Thats not going to
happen. So this is going to be an endemic disease. Its like we take flu shots now, the 1918 flu still sticking around. So theres a certain caliber of infectious disease that youre just not going to vaccinate your way out of it
completely. And so what youre trying to get to is a world where the amount of disruption from this virus is tolerable for us with a variety of mitigation procedures. And the ones we have in our toolbox are obviously the vaccines, and
thats the number one tool and as many people as possible should get vaccinated, including once the FDA approves it, kids under 12.
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But in addition to that, its seeming like the current amount of vaccination we have in the country is not sufficient to really keep a lid on Delta. And so additional mitigations are needed. The other obvious one is masks.
Nobody likes masks. I get it. And so figuring out how we are going to have ongoing persistent mitigation. The other tool in the toolbox is ongoing, regular, what we call universal testing. In other words, testing people, in this case for K-12 schools, once a week, so that you can identify early an outbreak. And instead of shutting down a school, you just send home a classroom, or better yet you send home a couple of kids, and you keep the rest of
the school open, and you keep the football game going on and everything else. And Mark mentioned it, were very fortunate, you should watch the video, honest to God, the Pennsylvania press conference on Monday.
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Miguel Cardona, the Secretary of Education for the United States, spoke at this conference. We had Karen Hogan, one of the members of our concentric team up there. And Ginkgo was the sole source provider for K-12 testing in Pennsylvania. And the secretary was saying this is a model for the whole country. And I think thats right. This is a way to keep schools open in the midst of this pandemic, especially when kids
are un-vaccinated. And so were really excited about being able to play this role. Where biosecurity goes from here is an open question. It is very political. Republican states and Democratic states are
approaching this very differently. But the reality is youre also seeing in places like Georgia and Florida now whole districts having to close down, because at the end of the day, it doesnt matter your politics, if theres a raging
outbreak at your school, youre not going to send your kid in.
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And so youre sort of between a rock and a hard place a little bit right now with the Delta variant and school opening. And I think one of the ways out is going to be this type of universal testing. And so were really
excited about this. Its totally different than diagnostics. Its got to be simpler, and faster, and work in a school and all of this, and thats really what we optimize our product for. But you can see the list there. We also saw
just yesterday signed California, thats new news. So Im really excited to have them on the list there. Obviously one of the biggest recipients of this $10 billion that the Federal Government gave to the state specifically for K-12 testing. And so if you go to the next slide. I think in the future, what will happen because of the build-out were going to see around sort of this universal
testing and monitoring testing this fall and spring, I think youll see some sort of a chance to have a more robust biosecurity infrastructure that lasts post pandemic.
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And so we sort of have kind of different categories here, being able to monitor ranging, from sewers, to peoples noses, and airports and things like that. We announced a contract with the CDC for airport testing and
partnership with express check for flights coming in from India to look for new variants. That just got announced about a week and a half ago. Thats sort of the frontline. And then you want to be able to identify what you find, sequence those
variants, see whats going on. And then you want to have rapid response and recovery. And this is where our work folks like Aldevron and others, in terms of being able to spin up a quick response. Anything we can plug in there is a great
opportunity for Ginkgo. This is ultimately I think what the United States will need to build, and really the world.
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If you go to the next slide. I said at the beginning of the presentation, but Ginkgos goal is to make it as easy to program cells as it is to program computers. And were living through an experience where were
having a really negative experience with biology right now. And from our perspective, if were going to build out this technology responsibly, just like Google would need cybersecurity, Ginkgo should be building biosecurity. And so we intend to
do that, and this is really the beginnings of it. And so were really quite proud of the work were doing in K-12 schools right now. So if you go to the next slide. Those are, again, those three
points I wanted to land today.
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Cell programming is starting to flip into a mode where people are coming to us rather than me having to get on too many planes. Secondly, downstream value is being proven in the near term. This is something that Ive been
waiting years for in the company to see these types of commercial successes come out, because these programs take a while. Really starting to pick up the pace and have more successes, which is great. And then Delta is a new disease effectively, and
so its going to change the landscape for ongoing biosecurity. So I really appreciate everybodys time. Im going to kick it to Anna Marie, who is going to pull questions from a variety of sources and throw them at us. So excited
about that. Thank you.
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Anna Marie:
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Thanks, Jason. Were going to see if technology is going to cooperate with us here. A reminder for anyone dialing in, any of the analysts dialing in, just raise your hand if you want to ask a question. While they are getting
organized, Im going to just pull a couple of questions that weve gotten from a variety of sources. Weve had folks sending in questions from Twitter and via email. Our employees have been submitting questions. Our employees are our
largest shareholder, and so we want to give them the opportunity to ask questions in these settings as well. So well have a variety of sources here. And then for the analysts, Ill call your name and allow you to talk on Zoom, and
youll be able to ask your question live as well.
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So while were getting settled, Ill start with a question here for Jason, just on sort of general strategy and update. You obviously shared the news that Reshma from Vertex will be joining the board. And so Joal Duncan
sent us an email asking what opportunities Reshma Kewalramani from Vertex and Shyam Sankar with Palantir bring to the table for Ginkgo? Weve got these strong operators joining the board. Also Christian Henry from Pac Bio. Weve got a
bunch of great independent board members. How do you think about building the board?
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Jason Kelly:
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Yeah. So I think the number one thing were looking for is operational support to help the management team make wise decisions, and importantly not repeat mistakes that other people have already done before. And so I would say,
Shyams been on the board for Reshma was a new addition, Shyams been on the board for four and a half years. And so weve been fortunate. Ill speak to Shyam first and then Reshma. With Shyam, if you look at Palantir as a
business, theyre a big horizontal platform. They do large, multi-year contracts with big companies. They do sort of custom engineering projects in a totally different area, machine learning and AI versus bioengineering. But the way they sell,
how they organize their commercial organization deals, Ive learned so much from Shyam its amazing. And so thats been a real speed up for us on the commercial side of things.
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Palantir is actually doing a fair bit in, as youve seen publicly, things in biosecurity and otherwise for data monitoring. I think there could be opportunities to collaborate there, but we dont have anything in place
today. With Reshma, very similarly, the number one reason Reshma Shetty at Ginkgo and I are so excited about having Reshma K. on the board is that we really felt like she got Ginkgo culturally. And as were taking the company public, it can
create cultural upheaval in the organization, and we want to bridge that and maintain what keeps Ginkgo special, which let us move so quickly, what let us really lead in this industry, want to maintain all that stuff. I think Reshma has gone through
that experience. Shes been around the block and sort of fast growing in these big companies. And again, just kind of gets us intuitively. And then on the other side of that coin, shes at a big therapeutics company, and that is a big area
that were moving into. So going forward, I expect a lot of opportunities to discuss strategy with her, and Ari and Marijn around our plans in therapeutics.
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Anna Marie:
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Great. Im going to throw one more in from Twitter, and then well go to you, Tejas, on the phone. So from B EZ on Twitter, this is for you, Jason, will Ginkgo ever bring their own products to market? A key example was
COVID testing, but lets think five years down the road.
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Jason Kelly:
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Yeah, thats an awesome question. So the short answers no. Ginkgos business is to operate as a horizontal platform and enable other people to bring products to market. Thats really very deeply embedded in the
mission of the company. Concentric a bit of a special case, because what we realized when the pandemic got rolling was one of our core cultural tenants at Ginkgo is caring how our platform is used. And if were entering and opening up this sort
of aperture on what you can do with biology to make it more programmable in a world where theres not robust biosecurity, that feels irresponsible. And so we are building products there as a compliment to our main line cell engineering
capabilities. Thats a unique situation. If I was to engineer a cell to do something, Ginkgo wouldnt bring that to market. Wed do that via a partner, customer.
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Anna Marie:
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Great. Thanks, Jason. All right, Tejas, this is where we get to test technology. Im going to allow you to talk, and hopefully youll be able to ask your question to the world here.
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Tejas Savant:
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All right. Can you hear me, Anna Marie?
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Anna Marie:
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We can hear you.
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Jason Kelly:
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Theres no video, Tejas. So Im just saying.
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Anna Marie:
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I know. We didnt give them the power.
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Jason Kelly:
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Oh, we didnt give them video. Okay. All right.
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Anna Marie:
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No. No. Leo, who is our amazing IT wizard, told me that was a terrible idea. So we just get to hear the disembodied voices. Go ahead.
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Tejas Savant:
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So first of all, Jason, congrats on a solid first half year. Just wanted to ask sort of a broad industry-based question. So one of your competitors obviously had a bit of a hard reset recently after a key product ran into issues.
Now you have a horizontal platform based model, which means not all programs that youre working on actually need to pan out. And in that sense, thats the power of the business model. That said, there is the possibility that in the
earlier stages of your revenue ramp, some of your key programs might run into a similar hurdle. So my question is essentially in two parts, what are the things you can do internally in the near term to minimize that sort of a situation arising? And
second, outside of Aldevron, Cronos, and Motif that you highlighted in the press release today, are there any other sort of key programs over the next 18 months or so that we should be paying attention to?
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Jason Kelly:
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Sure. Yeah. So Ill comment on this briefly. Yeah. So the first thing Id say is we know a ton of the people at Zymergen. It is like a f***ing amazing technical organization. What theyve been building in the last
seven, eight years there is just a really high caliber platform. And so what youre seeing
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is effectively, in the pharma industry, its like missing a phase two trial or something. It happens. It happens on any type of... Particularly when it comes to hard technology developments. Some things are going to work. Some
things arent. And we understand that across the portfolio thats just how you do it when it comes to things that have embedded scientific risk.
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And so I think its roughly as simple as that. What can you do to escape that? Well, I think one thing is certain markets will have a lot of that and certain ones wont. By the way, that type of risk is highly economically
rewarded. Theres a reason that therapeutics go for what they do and have the markets they do. Its because theres so much embedded risk in developing them. But if you take, for example, our work in the food space or enzymes or
things like that, it has less of that more catastrophic risk that you would see in either therapeutics or in something thats just a brand new area for biotechnology. The more historical example that would be biofuels, but now more recently
things like novel materials.
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So thats how I would bucket it. I think you will have certain projects that are high risk, high reward, and youll have certain ones that are lower risk, lower reward. And from a Ginkgo standpoint, having a portfolio of
all those is great. But ultimately, that sort of centralized product risk will be embedded with our partners. Some of whom will do amazing and some of whom, it wont work out. And thats okay. Thats going to be how that ecosystem
looks. Does that make sense?
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Tejas Savant:
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Yeah. Thats great. And if you could sort of flag maybe two or three key programs over the next 18 months, thatll be terrific.
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Jason Kelly:
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Yeah. Its a very good question. So one of the things to highlight is theres other things on that list with Cronos. So we have first thing that theyve been talking about publicly, but theres more to come. So I
am generally excited about that. I think a little bit of success there will hopefully lead to more. In general though, we dont try to project out what is going to be the program that is successful and pays us money in half one 2022, because at
the end of the day, the amount of variables that are embedded in that, both technical, but very, very importantly, the customer. They could decide to go to market. They could decide to put it on the shelf. They could decide to wait another year. We
just, at the end of the day, dont control that. And so I would say... I dont want to specifically say, Hey. This is going to land next year or not. I will say Im very excited about the stuff were doing in
therapeutics. So I think that as a category, it will be really exciting for us in 2022.
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Tejas Savant:
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Super helpful. Thank you, Jason.
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Jason Kelly:
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Yep.
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Anna Marie:
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Thanks, Tejas. All right. Im going to do one more from Twitter here, and then Im going to call on... Lets see. Whos next on the list? Im just going in alphabetical order. Theres no favorites here.
Of people who raised their... I guess not alphabetical, but when you raised your hand. So Im not saying favorites. Next on the list will be Mike Freeman after we take another question from Twitter,which is from Alexander Roznowski. How
long do you foresee Knights law in the future?
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Jason Kelly:
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Okay. Yeah. So theres sort of two assets in Ginkgos platform, our foundry, which is what Im sitting in front of here in Boston, about 200,000 square feet of space, heavy investment in robotic automation and the
cool thing about the foundry is it gets better as it gets bigger. So think like an auto plant or a semiconductor fab at Intel or something, things that improve with scale. So weve been roughly tripling the output of the facility and having the
cost on a unit operation basis annually. Theres a blip for COVID, but in general, over the last six years. We call that Knights law for Tom Knight, our co-founder. Hes the first one that sort
of noticed it was happening.
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And so it initially started happening just by virtue of how we were scaling for the first three years of Knights law. And then we said, Okay. Lets set that as our target and see if we can keep up with it. It
is a very aggressive scaling rate to be clear. Its faster than Moores law. So we see a pretty clear path to that over the next four to five years, just with a technology roadmap that were happy with. We are fortunate because what
were doing is were shifting work that today is done in a distributed fashion. So people with my background, PhD in bioengineering, put on a white lab coat, stand at a lab bench, work with a pipette by hand and do a craft. Think like a
chef. A craft process at the bench. Were taking that and were moving it onto robotics and automation, standardizing it and driving scale that way. Okay?
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Thats new. That work is... If you walk into a top shelf biotech company, its still being done by hand. And so we actually have a lot of free wins, believe it or not, that we gained just by even just standardizing things,
adding quality control and all sorts of things. So we have a pretty good path before we need scientific breakthroughs. That starts happening further out. I will note that things like Moores law ran on scientific breakthroughs for 50 years.
They needed breakthroughs in lithography. It was photonics research. Even as our scale goes up, I still like our odds, because theres a lot of ways to imagine addressing how to make biology cheaper and faster to program. But as of now,
its mostly just really engineering horsepower.
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Anna Marie:
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Great. Thanks. All right. Mike Freeman from Raymond James, Im going to allow you to talk.
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Mike Freeman:
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All right. Can you hear me?
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Anna Marie:
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We can.
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Mike Freeman:
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All right. Jason, Mark, Anna Marie, thanks so much for taking some time with us today and for making time for me and Raymond James today. Congratulations on the first half, first of all. And congrats on escalating some goalposts
there. Ill ask some questions about how and where synthetic biology might be applied in the future or might be applied right now. There is a clear, huge opportunity in bringing your customers from their supply chains, which rely on
petrochemistry, which rely on natural extraction, and bringing that into biomanufacturing. I wonder if you are working with customers now that are looking beyond drop-in replacements to their current supply
chains. And what type of customer might this be? And would that be a different type of agreement that you might strike with them if you are doing sort of some of that discovery and exploration work with them?
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Jason Kelly:
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Yeah. Super good question. So the short answer is similar agreement, I think. Obviously, its a different risk profile from our standpoint. A discovery projects less likely to... Higher risk, higher reward. But that means
the customer is getting a bigger reward and were getting a bigger percent because their app is more valuable. So I dont think we need to dramatically change the business model with regard to those projects. I would agree with you in the
industrial section right now, were a little more in the kind of replace existing stuff. But rewind the clock on biotechnology. So Genentech, we are honored to be able to take their own ticker coming up, when they first started, the first
products in the biotech industry were things like insulin and... They were replacements for protein drugs that were currently being extracted from pigs. Its kind of what youre seeing in the industrial side.
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But then nowadays, we use genetic engineering in therapeutics for discovering new antibodies, new gene therapies. It moved past that. The reason you go after those replacements is theyre the low hanging fruit. And whats
happened is as the technology has gotten cheaper to use, new markets are now accessible with biotechnology, things like in the chemical space and so on. One of our partner companies, Genomatica, just announced a really great partnership with
Lululemon today. So by the way, Lululemon doing a biotech deal for plant-based nylon, thats f***ing cool! And so thats the world were entering. Yes, its replacing nylon. I get it. But you are seeing that consumer pull for
those replacements. And now that the technology allows it to be technically feasible, youre going to see more of those in the industrial side. But then eventually I think discovery is what comes after the
drop-ins.
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Mike Freeman:
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Excellent. Thats really helpful. Thanks so much.
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Anna Marie:
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Thanks, Mike. So this is a question. Its sort of related to that one from Mike, from a Ginkgo employee, employee shareholder. So they say, Look. Some programs we work on are highly complex and have a lot of technical
risk and some feel like low hanging fruit. Whats the ideal blend when we get out to 2025 and were looking at 500 programs? How do we think about that mix?
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Jason Kelly:
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The blended is do everything. Does AWS overthink who signs up for server usage? Does Apple try to pick who runs in the app store? No. The answers Ginkgo wants it all. And so we will take the people that come at the rate they
show up. And if we need more capacity, well build it. But were not trying to overfit... I dont think Im so smart as to know what products are going to be the next ones to hit. Were much more interested in customers that
are excited to get our platform as fast as possible.
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Anna Marie:
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Okay. Great. Thanks. Mark Massaro, I should have given you a warning. I didnt, but youre going to be up next, Mark Massaro from BTIG. Im going to take one more question here from the Twitter verse. Antonio Regalado
asks, Please name products, any and all products, that are in the market being sold now which are made with organisms, engineered or optimized, in a Ginkgo Foundry. And I know we talked about a few today that are obviously hitting now or
in the next couple of months. Anything else youd want to talk about there, Jason?
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Jason Kelly:
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Yeah. The other ones to add to that would be some of our earlier flavor and fragrance products. So we work with a partner, Robertet, and have brought a few fragrance ingredients to market also at about, call it about, 50,000 liter
fermentation scale. And then these ones coming up now, you are seeing in the animal-free meat space, in the cannabis space and in the enzyme space for Aldevron. So really excited to get more on that list, but yeah, thats our list
today.
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Anna Marie:
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Great. Thanks. All right. Mark Massaro from BTIG, I am going to allow you to talk. You may need to unmute. There you go.
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Mark Massaro:
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Okay. Can you hear me?
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Anna Marie:
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Yeah.
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Mark Massaro:
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Great. Well, guys, thanks for the call today and congrats on increasing your cell program count to 30. A lot of us are already thinking about 2022. And so I know the question has been asked a little bit about how we think about some
of these cell programs manifesting in different industries, whether its pharma, food and ag, industrial and consumer. Can you just give us a sense? It does seem like its a little bit out of your control, Jason. You talk about youll
take what comes to you, but can you give us a sense for what you
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think... Among pharma, food and ag and industrial, consumer, which horse do you think will pull forward sooner rather than later? And then I also wanted to ask a question about your M&A appetite. I think in the past, youve
talked about the potential to do some small-scale tuck-ins, maybe fortifying Codebase or maybe looking at some other things. So how do you think about the M&A outlook as well?
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Jason Kelly:
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Yeah. Those are both great questions. So I would say when it comes to where we expect the most new deals, for this year, I think we have it on the slide there. Its kind of a blend between therapeutics and non-therapeutics and small and big companies. I think probably a little 60/30 or 60/40 non-therapeutics to therapeutics or something. But yeah, I dont know. I think we
could start to move pretty quickly on the industrial side and get a lot more smaller companies there. Thats one of the things Im really excited about. For everyone whos tuning in from the synthetic biology world, we are really,
really excited to make it feasible for small companies to get on a platform in a way that doesnt break the bank. We want to accelerate them. We think its a lot smarter for them to use us than use their own infrastructure.
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And so I think that could move real quickly and we could get a lot in that category more with the smaller companies. The more mature, large companies, the Cortevas of the world, those deals just always take a long time. But you
could see us doing a lot of small company deals quickly. In therapeutics, its a matter of proving our chops. Im really excited about this Biogen deal, shows relevance of the platform and AV I want to do more deals, to do deals in gene
therapy and so on. As we can demonstrate our utility there, I think there is a lot more work to do. Its the newest market for us, but its the biggest R&D spend in the industry. So that ones a little more to do with how soon do
people think Im not bullshit on being able to do better than their internal R&D teams, but we can prove ourselves pretty quick and we have a lot of horsepower here. So pharma will move at whatever rate that takes for me to prove
it.
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Anna Marie:
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M&A?
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Jason Kelly:
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Oh, M&A. Yeah. I think youve got it right. I think we have the opportunity to... with Dutch DNA, we brought in some Codebase assets we think are important. I mean, I think one way to look at it is when something comes into
the Ginkgo platform like Dutch, its now available to anybody that wants to use our platform. There also might be assets that are sitting at a company thats product focused. We can bring that in and turn it into a platform asset. We will
find opportunities to do that, but at the same time, we are big supporters and, youve seen this with our relationship with companies like Twist and Berkeley Lights, we want to have a very robust tools and products industry in the area of
synthetic biology and we want to be the biggest customer of most of these technologies. And so we dont need to be acquiring and bringing that stuff in-house if there is a healthy industry to support us
and suppliers and we want to really make that industry grow alongside us.
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Mark Massaro:
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Okay. Thank you.
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Anna Marie:
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Thanks, Mark. Tycho, youll be up next, but Ill take a couple more from Twitter. These are going to be for you, Mark, while you get ready, Tycho. So the first ones from Varro Analytics on Twitter. What goes
into COGS for a finished Ginkgo stream that gets delivered to a customer plant? Is COGS minimal?
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Mark Dmytruk:
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Yeah. So we dont actually manufacture any of the commercial products for our customers and so we dont have a cogs line on our P&L. And if you think about it, the actual cogs relating to a finished strain that we
deliver to a customer, its nominal. Literally after a couple of years of work and multiple million dollars of R&D services, were just handing them a vial. So the cogs is really not something that is... like I said, it just
doesnt hit our P&L. What we do have, however, is an R&D services line or an R& D expense line. So we are providing R&D services to our customers over the course of multiple years typically. And what were doing is
designing and engineering that finished strain.
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And so just think about it from that perspective as you know, sort of in the aggregate, were not profitable today, but as we drive that Foundry scale economic, we will drive or we expect to drive our EBITDA margins just on the
Foundry services part of our business model to the, call it, 20 to 30% range over time. And of course that excludes downstream value share. So hopefully, Im answering the question there.
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Anna Marie:
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Thanks, Mark. And theres a sort of related question on that downstream value share from B E Z again on Twitter, which is, How does... Maybe its for me, but Ill let you take it. How does investor
relations plan to update investors on the valuations of downstream assets, royalties or equity over time?
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Mark Dmytruk:
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Yeah. So as I mentioned in the comments, were not going to provide guidance on something that really is unpredictable as to timing and amount, but we are going to calibrate you on downstream value share periodically. And I
think well evaluate sort of what that means, but lets just say that that will likely be once a year or so. We will look at the portfolio of downstream value share. And youll recall in the investor materials, we had come to this
$15 million NPV number per program. And so we will be calibrating around that number in future as we get more data points, as we get more programs that are marked to market, et cetera. So I think its going to be probably around once a
year or so that well update that.
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Anna Marie:
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Great. Thanks, Mark. All right. Tycho.
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Jason Kelly:
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Oh, Anna Marie. Sorry. I was just checking my memory. Yeah. So we do have one other one with a different fragrance partner, other than Robertet that I have not... Thats not been announced. And so I just wanted to mention that,
because otherwise Antonio will probably call me about it anyway, but, yeah, that also is another one. Sorry. Go ahead.
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Mark Dmytruk:
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We cant forget about the Moderna vaccine itself.
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Jason Kelly:
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We dont make any of that stuff, but yeah. But yes. Were happy to provide optimization where we can. Yes. But were not a manufacturer, just to be clear.
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Anna Marie:
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Yep. All right. Tycho, Im going to allow you to talk.
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Tycho Peterson:
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Great. Can you hear me okay?
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Anna Marie:
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Yep. We can hear you.
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Tycho Peterson:
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Okay. Good. Thanks for hosting the call. Jason, you talked about how success begets success here and you tend to get more inbound interest from customers around similar projects. So Im wondering on the back of the Aldevron 10X
improvement production, if youre getting inbounds from other mRNA companies and just how youre thinking about mRNA as a category overall.
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Jason Kelly:
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Yeah. This is a super good question. Yeah. So we really identified VCE as a bottleneck that was pretty obvious. There are a couple of things we can work on. There are other bottlenecks in the... Well, not bottlenecks, but other
things in the process that are potentially supply constrained or at least expensive. And then you can also work on better versions of some of these things. There hasnt been any time for that during the pandemic, but you could make better
versions of a VCE from a standpoint of... And other enzymes that are present in that process. I think theres a great opportunity there. And we have had inbound interest in that.
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Tycho Peterson:
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And then if I go back to the analyst day earlier this summer, one of the things you talked about with Codebase was trying to diversify the types of programs youre working on to enhance Codebase. Can you maybe just touch on
that dynamic? And are there particular areas youre looking at to enhance the database?
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Jason Kelly:
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Yeah. So the most obvious thing is when we branch out into new species. So three or four years ago now, when we started working in mammalian cells, that was a big leap for us in terms of building out both Codebase assets and
actually it should be mentioned, Tycho, the Foundry, the automation, also needs to... You kind of improve it both on scale and what we can do with it. And so its not overnight you can use exactly the same stuff to engineer a mammalian cell. We
had that do a fair bit of process development to make some of those things operate at a bigger scale, and were still doing that. And so Ill highlight species is one of the axes where youll see us keep adding new things. So each new
species is one good way to look at how we expand Codebase.
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Tycho Peterson:
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Great. And then just last one. I know you talked on kind of Knights law earlier. Youve laid out that path to kind of a sub $10 cost of programming a cell. Can you maybe just talk on how much technical risk there is to
that? And how much of thats just dependent on sequencing costs coming down, olgo cost coming down versus internal development?
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Jason Kelly:
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Yeah. Certainly things like gene synthesis, olgo cost sequencing or inputs into our process, but the dominant thing is really internal development. Overwhelmingly. Yeah. Because were not really a sequencer plus one step, in
which case youre really correlated to what sequencing looks like, or gene synthesis plus one thing. To engineer a cell is a relatively elaborate set of things. And then they vary depending on exactly what species youre in and what end
product youre making. This is what makes it hard, honestly, to build that the sort of Foundry infrastructure. Its the fact that scientists dont go to work and do the same thing every day. Its that variability in the work that
makes it hard to make it automated at scale. And so yeah. So I would say we have opportunity. Yes. Anyways, does that answer your question?
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Tycho Peterson:
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Yeah. No. Thats helpful.
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Jason Kelly:
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Okay. All right. Yeah.
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Tycho Peterson:
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Thanks very much. Thanks for taking the questions.
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Anna Marie:
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Thanks, Tycho. All right. There are probably 100 questions here from Twitter that we did not get to answer, and it breaks my heart, which folks who saw our Reddit AMA will know, I have a very hard time leaving questions unanswered,
but we are already two minutes over time and we promised our employees, we would do an employee call after this. And so we want to get back to them. But theres one more question here that feels like a good wrap up question from Twitter, which
just says, What are the main challenges in scaling syn bio solutions? And how will Ginkgo become the worlds best company at engineering biology? Some closing remarks maybe, Jason, with that
one.
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Jason Kelly:
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Yeah. So Ill highlight when people say scaling, theyre often thinking of two halves of the problem. One is getting a microbe in a tank at a big scale producing product. And that has its own set of challenges and
theres a whole set of know-how and learnings associated with running fermentation facilities. We have world experts in that. We help our customers, like Cronos and others, that havent done it
before. We like to work with customers, like Aldevron, that have done it many times before. So theres that, when people say scale, a lot of times, they mean that. Ill leave that aside just for a minute.
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At the end of the day, Ginkgos view is even that problem is largely a problem of how good are you at programming a genome. If you can make the cell good enough, then its a hell of a lot easier to scale it up into
fermentation. And then theres a whole set of applications, for example, in the therapeutic space where its really just about can you make an allergenic T-cell. These are problems that are a
function of how complex can you program a cell in general. That is overwhelmingly driven by our ability to reduce the cost of compiling and debugging, our ability to have genetic assets, which is the Foundry, and our ability to have genetic assets
in our Codebase, which is like our code library.
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But the thing that people miss that Im also really excited about and Im hoping for a lot of breakthroughs on the team here at Ginkgo is theres the art of cell programming, how you use those two assets to program a
cell. You could give me and my co-founder, Austin Che, the same compiler and debugger for a computer. And I promise you, Austin will write a lot better software than I write. And that is because he is a better
programmer. And so there is a theory of it thats also evolving very quickly and that saves us a lot of work in both in the Foundry and in terms of the Codebase we need. And so I cant wait to see what that looks like, how well learn
how to design. So what will the first programming languages look like? Its going to be wild. But I think thats going to be a big part of making this successful.
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Anna Marie:
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Great. Well, thank you everybody for joining us. This whole presentation will be available forever and ever, I suspect. Its all on our website. Its on YouTube. So feel free to look back on it. Feel free to email us any
time or shout at us on Twitter. We try to answer as many questions as we can and bring our culture of internal transparency with us as we enter the public market. So really again, appreciate everyone joining us. And enjoy the rest of the week. And
well talk to you again soon.
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Jason Kelly:
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Thanks, everybody.
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Mark Dmytruk:
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Bye.
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Grow with Ginkgo H1 Revenue Update & Business Review August 18, 2021
GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1Grow with Ginkgo H1 Revenue Update & Business Review August 18, 2021 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1
DISCLAIMER Forward-Looking Statements This presentation contains certain
forward-looking statements within the meaning of the federal securities laws, including statements with respect to the proposed business combination (the “Business Combination”) between Ginkgo Bioworks, Inc. (“Ginkgo”) and
Soaring Eagle Acquisition Corp. (“Soaring Eagle”), including statements regarding the anticipated timing of the extraordinary general meeting of Soaring Eagle’s shareholders (the “Special Meeting”) and the consummation
of the Business Combination, the services offered by Ginkgo and the markets in which it operates, and Ginkgo’s projected future results These forward-looking statements generally are identified by the words “believe,”
“project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “potential,” “opportunity,” “plan,”
“may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections
and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking
statements in this presentation, including but not limited to: (i) the risk that the transaction may not be completed in a timely manner or at all, which may adversely affect the price of Soaring Eagle’s securities, (ii) the risk that the
transaction may not be completed by Soaring Eagle’s business combination deadline and the potential failure to obtain an extension of the business combination deadline if sought by Soaring Eagle, (iii) the failure to satisfy the conditions to
the consummation of the transaction, including the adoption of the agreement and plan of merger by the shareholders of Soaring Eagle and Ginkgo, the satisfaction of the minimum trust account amount following redemptions by Soaring Eagle’s
public shareholders and the receipt of certain governmental and regulatory approvals, (iv) the lack of a third party valuation in determining whether or not to pursue the proposed transaction, (v) the occurrence of any event, change or other
circumstance that could give rise to the termination of the agreement and plan of merger, (vi) the effect of the announcement or pendency of the transaction on Ginkgo business relationships, performance, and business generally, (vii) risks that the
proposed transaction disrupts current plans of Ginkgo and potential difficulties in Ginkgo employee retention as a result of the proposed transaction, (viii) the outcome of any legal proceedings that may be instituted against Ginkgo or against
Soaring Eagle related to the agreement and plan of merger or the proposed transaction, (ix) the ability to maintain the listing of Soaring Eagle’s securities on Nasdaq, (x) volatility in the price of Soaring Eagle’s securities due to a
variety of factors, including changes in the competitive and highly regulated industries in which Ginkgo plans to operate, variations in performance across competitors, changes in laws and regulations affecting Ginkgo's business and changes in the
combined capital structure, (xi) the ability to implement business plans, forecasts, and other expectations after the completion of the proposed transaction, and identify and realize additional opportunities, and (xii) the risk of downturns in
demand for products using synthetic biology. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in the “Risk Factors'” section of the Proxy
Statement (as defined below) and in Soaring Eagle’s other filings with the Soaring Eagle. Soaring Eagle and Ginkgo caution that the foregoing list of factors is not exclusive. Soaring Eagle and Ginkgo caution readers not to place undue
reliance upon any forward-looking statements, which speak only as of the date made. Neither Soaring Eagle nor Ginkgo undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to
reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based. Industry and Market Data In this presentation, Ginkgo relies on and refers to certain information and statistics
regarding the markets and industries in which Ginkgo competes. Such information and statistics are based on Ginkgo’s management’s estimates and/or obtained from third-party sources, including reports by market research firms and company
filings. While Ginkgo believes such third-party information is reliable, there can be no assurance as to the accuracy or completeness of the indicated information. Neither Ginkgo nor Soaring Eagle has independently verified the accuracy or
completeness of the information provided by the third-party sources. Trademarks This presentation may contain trademarks, service marks, trade names and copyrights of other companies, which are the property of their respective owners, and
Ginkgo’s use thereof does not imply an affiliation with, or endorsement by, the owners of such trademarks, service marks, trade names and copyrights. Solely for convenience, some of the trademarks, service marks, trade names and copyrights
referred to in this presentation may be listed without the TM, © or ® symbols, but Ginkgo will assert, to the fullest extent under applicable law, the rights of the applicable owners, if any, to these trademarks, service marks, trade names
and copyrights. Additional Information and Where to Find It This presentation relates to a proposed Business Combination between Ginkgo and Soaring Eagle. This presentation does not constitute an offer to sell or exchange, or the solicitation of an
offer to buy or exchange, any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, sale or exchange would be unlawful prior to registration or qualification under the securities laws of any such
jurisdiction. In connection with the proposed transaction, Soaring Eagle filed a Proxy Statement on August 13, 2021 (the “Proxy Statement”). The Proxy Statement has been sent to all Soaring Eagle shareholders as of the Record Date.
Soaring Eagle also will file other documents regarding the proposed transaction with the SEC. Before making any voting decision, investors and security holders of Soaring Eagle and Ginkgo are urged to read the Proxy Statement and all other relevant
documents filed or that will be filed with the SEC in connection with the proposed transaction as they become available because they will contain important information about the proposed transaction. Investors and security holders may obtain free
copies of the Proxy Statement and all other relevant documents filed or that will be filed with the SEC by Soaring Eagle through the website maintained by the SEC at www.sec.gov. In addition, the documents filed by Soaring Eagle may be obtained free
of charge by written request to Soaring Eagle at 955 Fifth Avenue, New York, NY, 10075, Attention: Eli Baker, Chief Financial Officer, (310) 209-7280. Participants in Solicitation Soaring Eagle and Ginkgo and their respective directors and officers
may be deemed to be participants in the solicitation of proxies from Soaring Eagle’s shareholders in connection with the proposed transaction. Information about Soaring Eagle’s directors and executive officers and their ownership of
Soaring Eagle’s securities is set forth in Soaring Eagle’s filings with the SEC. To the extent that holdings of Soaring Eagle’s securities have changed since the amounts printed in Soaring Eagle’s Proxy Statement, such
changes have been or will be reflected on Statements of Change in Ownership on Form 4 filed with the SEC. Additional information regarding the interests of those persons and other persons who may be deemed participants in the proposed transaction
may be obtained by reading the Proxy Statement. You may obtain free copies of these documents as described in the preceding paragraph. 2DISCLAIMER Forward-Looking Statements This presentation contains certain forward-looking statements within the
meaning of the federal securities laws, including statements with respect to the proposed business combination (the “Business Combination”) between Ginkgo Bioworks, Inc. (“Ginkgo”) and Soaring Eagle Acquisition Corp.
(“Soaring Eagle”), including statements regarding the anticipated timing of the extraordinary general meeting of Soaring Eagle’s shareholders (the “Special Meeting”) and the consummation of the Business Combination, the
services offered by Ginkgo and the markets in which it operates, and Ginkgo’s projected future results These forward-looking statements generally are identified by the words “believe,” “project,” “expect,”
“anticipate,” “estimate,” “intend,” “strategy,” “future,” “potential,” “opportunity,” “plan,” “may,” “should,”
“will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events
that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this presentation, including
but not limited to: (i) the risk that the transaction may not be completed in a timely manner or at all, which may adversely affect the price of Soaring Eagle’s securities, (ii) the risk that the transaction may not be completed by Soaring
Eagle’s business combination deadline and the potential failure to obtain an extension of the business combination deadline if sought by Soaring Eagle, (iii) the failure to satisfy the conditions to the consummation of the transaction,
including the adoption of the agreement and plan of merger by the shareholders of Soaring Eagle and Ginkgo, the satisfaction of the minimum trust account amount following redemptions by Soaring Eagle’s public shareholders and the receipt of
certain governmental and regulatory approvals, (iv) the lack of a third party valuation in determining whether or not to pursue the proposed transaction, (v) the occurrence of any event, change or other circumstance that could give rise to the
termination of the agreement and plan of merger, (vi) the effect of the announcement or pendency of the transaction on Ginkgo business relationships, performance, and business generally, (vii) risks that the proposed transaction disrupts current
plans of Ginkgo and potential difficulties in Ginkgo employee retention as a result of the proposed transaction, (viii) the outcome of any legal proceedings that may be instituted against Ginkgo or against Soaring Eagle related to the agreement and
plan of merger or the proposed transaction, (ix) the ability to maintain the listing of Soaring Eagle’s securities on Nasdaq, (x) volatility in the price of Soaring Eagle’s securities due to a variety of factors, including changes in the
competitive and highly regulated industries in which Ginkgo plans to operate, variations in performance across competitors, changes in laws and regulations affecting Ginkgo's business and changes in the combined capital structure, (xi) the ability
to implement business plans, forecasts, and other expectations after the completion of the proposed transaction, and identify and realize additional opportunities, and (xii) the risk of downturns in demand for products using synthetic biology. The
foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in the “Risk Factors'” section of the Proxy Statement (as defined below) and in Soaring
Eagle’s other filings with the Soaring Eagle. Soaring Eagle and Ginkgo caution that the foregoing list of factors is not exclusive. Soaring Eagle and Ginkgo caution readers not to place undue reliance upon any forward-looking statements, which
speak only as of the date made. Neither Soaring Eagle nor Ginkgo undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change
in events, conditions or circumstances on which any such statement is based. Industry and Market Data In this presentation, Ginkgo relies on and refers to certain information and statistics regarding the markets and industries in which Ginkgo
competes. Such information and statistics are based on Ginkgo’s management’s estimates and/or obtained from third-party sources, including reports by market research firms and company filings. While Ginkgo believes such third-party
information is reliable, there can be no assurance as to the accuracy or completeness of the indicated information. Neither Ginkgo nor Soaring Eagle has independently verified the accuracy or completeness of the information provided by the
third-party sources. Trademarks This presentation may contain trademarks, service marks, trade names and copyrights of other companies, which are the property of their respective owners, and Ginkgo’s use thereof does not imply an affiliation
with, or endorsement by, the owners of such trademarks, service marks, trade names and copyrights. Solely for convenience, some of the trademarks, service marks, trade names and copyrights referred to in this presentation may be listed without the
TM, © or ® symbols, but Ginkgo will assert, to the fullest extent under applicable law, the rights of the applicable owners, if any, to these trademarks, service marks, trade names and copyrights. Additional Information and Where to Find
It This presentation relates to a proposed Business Combination between Ginkgo and Soaring Eagle. This presentation does not constitute an offer to sell or exchange, or the solicitation of an offer to buy or exchange, any securities, nor shall there
be any sale of securities in any jurisdiction in which such offer, sale or exchange would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. In connection with the proposed transaction, Soaring
Eagle filed a Proxy Statement on August 13, 2021 (the “Proxy Statement”). The Proxy Statement has been sent to all Soaring Eagle shareholders as of the Record Date. Soaring Eagle also will file other documents regarding the proposed
transaction with the SEC. Before making any voting decision, investors and security holders of Soaring Eagle and Ginkgo are urged to read the Proxy Statement and all other relevant documents filed or that will be filed with the SEC in connection
with the proposed transaction as they become available because they will contain important information about the proposed transaction. Investors and security holders may obtain free copies of the Proxy Statement and all other relevant documents
filed or that will be filed with the SEC by Soaring Eagle through the website maintained by the SEC at www.sec.gov. In addition, the documents filed by Soaring Eagle may be obtained free of charge by written request to Soaring Eagle at 955 Fifth
Avenue, New York, NY, 10075, Attention: Eli Baker, Chief Financial Officer, (310) 209-7280. Participants in Solicitation Soaring Eagle and Ginkgo and their respective directors and officers may be deemed to be participants in the solicitation of
proxies from Soaring Eagle’s shareholders in connection with the proposed transaction. Information about Soaring Eagle’s directors and executive officers and their ownership of Soaring Eagle’s securities is set forth in Soaring
Eagle’s filings with the SEC. To the extent that holdings of Soaring Eagle’s securities have changed since the amounts printed in Soaring Eagle’s Proxy Statement, such changes have been or will be reflected on Statements of Change
in Ownership on Form 4 filed with the SEC. Additional information regarding the interests of those persons and other persons who may be deemed participants in the proposed transaction may be obtained by reading the Proxy Statement. You may obtain
free copies of these documents as described in the preceding paragraph. 2
Our Mission Make biology easier to engineer 3 GI N KGO B I O W OR K S H1 U
P D A T E | A U GU S T 2 0 2 1Our Mission Make biology easier to engineer 3 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1
We believe… 1 2 3 Cell programming is Downstream value will Delta
sucks. And so will the next thing. starting to become become more valuable than mainstream. Foundry service revenue. We have increased our 2021 Foundry service revenue de-risks Biosecurity will be a new market outlook for number of new platform
investments, but “wins” separate from diagnostics and we programs from 23 to 30 due to come from successful programs. are becoming a leader due to our higher-than-expected inbound We’ve heard a lot of questions about initial K-12
testing offering. We are interest from potential customers how downstream value works so now expecting our revenue to be at and enhanced credibility from we’re giving 3 near-term case least $75 million for the full year. completing programs.
studies. 4 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1We believe… 1 2 3 Cell programming is Downstream value will Delta sucks. And so will the next thing. starting to become become more valuable than mainstream. Foundry service
revenue. We have increased our 2021 Foundry service revenue de-risks Biosecurity will be a new market outlook for number of new platform investments, but “wins” separate from diagnostics and we programs from 23 to 30 due to come from
successful programs. are becoming a leader due to our higher-than-expected inbound We’ve heard a lot of questions about initial K-12 testing offering. We are interest from potential customers how downstream value works so now expecting our
revenue to be at and enhanced credibility from we’re giving 3 near-term case least $75 million for the full year. completing programs. studies. 4 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1
Recent Highlights New +11 new programs in H1 Programs (+3 from existing
customers) Program Successes (1) $400M+ state contracts for K-12 testing Biosecurity 1,000+ schools served Reshma Kewalramani (CEO Announced acquisition of of Vertex) announces she Other Highlights Dutch DNA (closed 7/1) will join Board of Directors
(1) Biosecurity contract value and performance is subject to Ginkgo’s ability to conduct sufficient outreach to school districts, school adoption rates of Concentric and the volume of testing performed within contracted states. These state
contracts can be 5 paused or terminated early and there is significant uncertainty in the K-12 testing market in general as the facts and circumstances of the pandemic change regularly. GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2
1
AGENDA H1 Revenue Update & Full Year Outlook Investor Presentation
Supplement The Market for Cell Programming Downstream Value and Program Updates Biosecurity Q&A 6 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1AGENDA H1 Revenue Update & Full Year Outlook Investor Presentation Supplement The
Market for Cell Programming Downstream Value and Program Updates Biosecurity Q&A 6 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1
AGENDA H1 Revenue Update & Full Year Outlook Investor Presentation
Supplement Q&A 7 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1AGENDA H1 Revenue Update & Full Year Outlook Investor Presentation Supplement Q&A 7 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1
H1 Revenue Update (Unaudited) $Ms FY 6mo ended June 30, 2020 2020 2021 %
YoY New Programs Launched 18 9 11 22% GAAP Revenue: Foundry $59 $31 $44 41% Biosecurity $17 -- $44 NM Total Revenue $77 $31 $88 180% 8 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1H1 Revenue Update (Unaudited) $Ms FY 6mo ended June 30,
2020 2020 2021 % YoY New Programs Launched 18 9 11 22% GAAP Revenue: Foundry $59 $31 $44 41% Biosecurity $17 -- $44 NM Total Revenue $77 $31 $88 180% 8 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1
Full Year Outlook (Unaudited) $Ms FY 6mo ended June 30, 2021 FY Outlook %
Change In 2021 2021 Updated 2020 2020 2021 % YoY Original Updated Outlook vs. 2020A New Programs Launched 18 9 11 22% 23 30 30% 67% GAAP Revenue: Foundry $59 $31 $44 41% $100 $100 - 69% (1) Biosecurity $17 -- $44 NM $50 $75+ 50%+ NM Total Revenue
$77 $31 $88 180% $150 $175+ 17%+ 127%+ Plus: we expect to see downstream value for certain programs delivered or nearing completion in H2 2021 (1) Biosecurity contract value and performance is subject to Ginkgo’s ability to conduct sufficient
outreach to school districts, school adoption rates of Concentric and the volume of testing performed within contracted states. These state contracts can be 9 paused or terminated early and there is significant uncertainty in the K-12 testing market
in general as the facts and circumstances of the pandemic change regularly. GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1Full Year Outlook (Unaudited) $Ms FY 6mo ended June 30, 2021 FY Outlook % Change In 2021 2021 Updated 2020 2020
2021 % YoY Original Updated Outlook vs. 2020A New Programs Launched 18 9 11 22% 23 30 30% 67% GAAP Revenue: Foundry $59 $31 $44 41% $100 $100 - 69% (1) Biosecurity $17 -- $44 NM $50 $75+ 50%+ NM Total Revenue $77 $31 $88 180% $150 $175+ 17%+ 127%+
Plus: we expect to see downstream value for certain programs delivered or nearing completion in H2 2021 (1) Biosecurity contract value and performance is subject to Ginkgo’s ability to conduct sufficient outreach to school districts, school
adoption rates of Concentric and the volume of testing performed within contracted states. These state contracts can be 9 paused or terminated early and there is significant uncertainty in the K-12 testing market in general as the facts and
circumstances of the pandemic change regularly. GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1
AGENDA H1 Revenue Update & Full Year Outlook Investor Presentation
Supplement The Market for Cell Programming Downstream Value and Program Updates Biosecurity Q&A 10 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1AGENDA H1 Revenue Update & Full Year Outlook Investor Presentation Supplement The
Market for Cell Programming Downstream Value and Program Updates Biosecurity Q&A 10 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1
From May 2021 Investor Presentation Over 70 major customer programs
across diverse industries have run on our platform through 2020 = DIVERSIFIED Cumulative Major 3rd Party Programs PLATFORM Can respond rapidly to 80 emerging opportunities and global threats + PHARMA & BIOTECH Mammalian capabilities &
PRE-2015: GOVERNMENT PROGRAMS Synlogic partnership First 5+ years of technology building funded 60 through non-dilutive government programs (DARPA, SBIR, etc.) + FOOD & NUTRITION Motif (Louis Dreyfus and Fonterra) launches portfolio of
animal-free protein + AGRICULTURE programs Selection by Bayer for 40 agriculture JV after significant industry vetting + INDUSTRIAL & ENVIRONMENT Experience in flavors & fragrances enabled expansion into CONSUMER & industrial chemicals
20 TECHNOLOGY Early experimentation making fine chemicals for flavors & fragrances 0 2015 2016 2017 2018 2019 2020 Consumer & Technology Industrial & Environment Agriculture Food & Nutrition Pharma & Biotech Gov't & Defense
Note: “Major” programs exclude proof of concept work and ancillary projects and typically have at least $500K actual / expected development costs on behalf of a customer 11 Gaining traction within increasingly sophisticated end markets
GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1From May 2021 Investor Presentation Over 70 major customer programs across diverse industries have run on our platform through 2020 = DIVERSIFIED Cumulative Major 3rd Party Programs PLATFORM
Can respond rapidly to 80 emerging opportunities and global threats + PHARMA & BIOTECH Mammalian capabilities & PRE-2015: GOVERNMENT PROGRAMS Synlogic partnership First 5+ years of technology building funded 60 through non-dilutive
government programs (DARPA, SBIR, etc.) + FOOD & NUTRITION Motif (Louis Dreyfus and Fonterra) launches portfolio of animal-free protein + AGRICULTURE programs Selection by Bayer for 40 agriculture JV after significant industry vetting +
INDUSTRIAL & ENVIRONMENT Experience in flavors & fragrances enabled expansion into CONSUMER & industrial chemicals 20 TECHNOLOGY Early experimentation making fine chemicals for flavors & fragrances 0 2015 2016 2017 2018 2019 2020
Consumer & Technology Industrial & Environment Agriculture Food & Nutrition Pharma & Biotech Gov't & Defense Note: “Major” programs exclude proof of concept work and ancillary projects and typically have at least
$500K actual / expected development costs on behalf of a customer 11 Gaining traction within increasingly sophisticated end markets GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1
From May 2021 Investor Presentation Programs drive both predictable
near-term revenues and long-term value creation with asymmetric upside potential Foundry Downstream Value Upfront payments to cover R&D Value sharing via customer equity and/or costs for customer programs royalties on completed programs Foundry
Royalty Stream Equity Equity represents the risk- adjusted NPV of a potential royalty stream OR … … … … Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 0 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Highly predictable revenue Cash flows from value
share are typically 100% contribution margin stream independent of as Ginkgo incurs minimal ongoing support or delivery costs program success The choice to structure downstream economics as royalties or equity is typically based on customer size
Note: Illustrative economics; variation exists between programs 12 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1From May 2021 Investor Presentation Programs drive both predictable near-term revenues and long-term value creation with
asymmetric upside potential Foundry Downstream Value Upfront payments to cover R&D Value sharing via customer equity and/or costs for customer programs royalties on completed programs Foundry Royalty Stream Equity Equity represents the risk-
adjusted NPV of a potential royalty stream OR … … … … Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 0 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Highly predictable revenue Cash flows from value share are typically 100% contribution margin stream
independent of as Ginkgo incurs minimal ongoing support or delivery costs program success The choice to structure downstream economics as royalties or equity is typically based on customer size Note: Illustrative economics; variation exists between
programs 12 GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1
From May 2021 Investor Presentation Thus, Ginkgo taps into two distinct
addressable markets: one for the R&D itself (Foundry Revenue) and one for the products enabled (Downstream Value) Market for Cell Programming R&D Emerging Market for Products Enabled 2030—2040 Annual Direct Economic Impact By Domain -
(partial estimate) Existing market for cell engineering lab operations ($B) Ginkgo can tap $60 into both labor $58B $1.2T $1.2T mkts: and tools Cell Engineering Labor High Estimate Cell Engineering Tools Low Estimate $48B Our scale $50 dramatically
+ significant secondary $22 reduces costs effects not measured $40B $40 $18 $33B $700B $15 $28B $30 $12 We bring $10 $20 efficiency to $36 scientists at $300B $300B $30 the bench $25 $21 $10 $17 $500B $800B $200B $200B $100B $0 Food & Materials
& 2019 2020E 2021E 2022E 2023E Health Consumer Other Agriculture Energy Source: Piper Sandler Research Source: McKinsey Global Institute; The Bio Revolution: Innovations transforming economies, societies, and our lives (May 13, 2020) Note: these
estimates reflect the estimated biotechnology penetration of these end-markets 13 20% CAGR GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1From May 2021 Investor Presentation Thus, Ginkgo taps into two distinct addressable markets: one
for the R&D itself (Foundry Revenue) and one for the products enabled (Downstream Value) Market for Cell Programming R&D Emerging Market for Products Enabled 2030—2040 Annual Direct Economic Impact By Domain - (partial estimate)
Existing market for cell engineering lab operations ($B) Ginkgo can tap $60 into both labor $58B $1.2T $1.2T mkts: and tools Cell Engineering Labor High Estimate Cell Engineering Tools Low Estimate $48B Our scale $50 dramatically + significant
secondary $22 reduces costs effects not measured $40B $40 $18 $33B $700B $15 $28B $30 $12 We bring $10 $20 efficiency to $36 scientists at $300B $300B $30 the bench $25 $21 $10 $17 $500B $800B $200B $200B $100B $0 Food & Materials & 2019
2020E 2021E 2022E 2023E Health Consumer Other Agriculture Energy Source: Piper Sandler Research Source: McKinsey Global Institute; The Bio Revolution: Innovations transforming economies, societies, and our lives (May 13, 2020) Note: these estimates
reflect the estimated biotechnology penetration of these end-markets 13 20% CAGR GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1
Ginkgo’s credibility across end-markets is driving inbound interest
and accelerating the pace of new program launches 19 New Programs Large market for cell programming R&D across segments 30 Expected for H2 30 Increasing annual Market Mature Companies Startups (1) Organizational focus and Leapfrog incumbents
with outlook from 23 to 30 Size benefit from incremental Ginkgo’s scale economics and scale & codebase breadth reduce upfront capital Strong mix of new investments needed logos (~60%) & repeat Scale and efficiency of the customers
(~40%) Prior platform wins; form close Projection Pharma & $15-$20B technical partnership and have 20 Pharma/biotech Biotech opportunity to penetrate large trending to approx. 18 existing R&D budgets 35% of H2 programs Breadth of
capabilities vs. in- Strong momentum Food house teams focused on plant with earlier-stage biology / food science; & $5-$10B businesses increasingly the default choice Agriculture 11 New 10 11 Recent success delivering Programs in H1 Industrial
commercial cell programs in in H1 & $7-$10B these sectors is making Ginkgo the clear leader Consumer Once a customer is on the platform, Ginkgo’s alliance management team With 3 new programs 0 works with the customer to identify new
program areas. from repeat customers 2020A 2021E Repeat customers are expected to represent about a third of new programs annually. (1) Market size reflects management estimates for cell programming R&D by industry, excluding spending in
academic research 14 +67% # of New Programs by Year GI N KGO B I O W OR K S H1 U P D A T E | A U GU S T 2 0 2 1Ginkgo’s credibility across end-markets is driving inbound interest and accelerating the pace of new program launches 19 New
Programs Large market for cell programming R&D across segments 30 Expected for H2 30 Increasing annual Market Mature Companies Startups (1) Organizational focus and Leapfrog incumbents with outlook from 23 to 30 Size benefit from incremental
Ginkgo’s scale economics and scale & codebase breadth reduce upfront capital Strong mix of new investments needed logos (~60%) & repeat Scale and efficiency of the customers (~40%) Prior platform wins; form close Projection Pharma
& $15-$20B technical partnership and have 20 Pharma/biotech Biotech opportunity to penetrate large trending to approx. 18 existing R&D budgets 35% of H2 programs Breadth of capabilities vs. in- Strong momentum Food house teams focused on
plant with earlier-stage biology / food science; & $5-$10B businesses increasingly the default choice Agriculture 11 New 10 11 Recent success delivering Programs in H1 Industrial commercial cell programs in in H1 & $7-$10B these sectors is
making Ginkgo the clear leader Consumer Once a customer is on the platform, Ginkgo’s alliance management team With 3 new programs 0 works with the customer to identify new program areas. from repeat customers 2020A 2021E Repeat customers are
expected to represent about a third of new programs annually. (1) Market size reflects management estimates for cell programming R&D by industry, excluding spending in academic research 14 +67% # of New Programs by Year GI N KGO B I O W OR K S
H1 U P D A T E | A U GU S T 2 0 2 1
APPENDIX 29APPENDIX 29
ADDITIONAL LEGAL INFORMATION
Forward-Looking Statements Legend
This document contains
certain forward-looking statements within the meaning of the federal securities laws with respect to the proposed transaction between Ginkgo and Soaring Eagle, including statements regarding the anticipated timing of Soaring Eagles
extraordinary general meeting of its shareholders (the Special Meeting) and the consummation of its proposed business combination with Ginkgo (the Business Combination), the services offered by Ginkgo and the markets in which
it operates, and Ginkgos projected future results. These forward-looking statements generally are identified by the words believe, project, expect, anticipate, estimate,
intend, strategy, future, potential, opportunity, plan, may, should, will, would, will be, will continue,
will likely result, and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks
and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this document, including but not limited to: (i) the risk that the transaction may not be completed in a timely manner
or at all, which may adversely affect the price of Soaring Eagles securities, (ii) the risk that the transaction may not be completed by Soaring Eagles business combination deadline and the potential failure to obtain an extension
of the business combination deadline if sought by Soaring Eagle, (iii) the failure to satisfy the conditions to the consummation of the transaction, including the adoption of the agreement and plan of merger by the shareholders of Soaring Eagle
and Ginkgo, the satisfaction of the minimum trust account amount following redemptions by Soaring Eagles public shareholders and the receipt of certain governmental and regulatory approvals, (iv) the lack of a third party valuation in
determining whether or not to pursue the proposed transaction, (v) the occurrence of any event, change or other circumstance that could give rise to the termination of the agreement and plan of merger, (vi) the effect of the announcement
or pendency of the transaction on Ginkgo business relationships, performance, and business generally, (vii) risks that the proposed transaction disrupts current plans of Ginkgo and potential difficulties in Ginkgo employee retention as a result
of the proposed transaction, (viii) the outcome of any legal proceedings that may be instituted against Ginkgo or against Soaring Eagle related to the agreement and plan of merger or the proposed transaction, (ix) the ability to maintain
the listing of Soaring Eagles securities on Nasdaq, (x) volatility in the price of Soaring Eagles securities due to a variety of factors, including changes in the competitive and highly regulated industries in which Ginkgo plans to
operate, variations in performance across competitors, changes in laws and regulations affecting Ginkgos business and changes in the combined capital structure, (xi) the ability to implement business plans, forecasts, and other
expectations after the completion of the proposed transaction, and identify and realize additional opportunities, and (xii) the risk of downturns in demand for products using synthetic biology. The foregoing list of factors is not exhaustive.
You should carefully consider the foregoing factors and the other risks and uncertainties described in the Risk Factors section of the Proxy Statement (as defined below) and in Soaring Eagles other filings with the Soaring
Eagle. Soaring Eagle and Ginkgo caution that the foregoing list of factors is not exclusive. Soaring Eagle and Ginkgo caution readers not to place undue reliance upon any forward-looking statements, which speak only as of the date made. Neither
Soaring Eagle nor Ginkgo undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any change in events, conditions or circumstances
on which any such statement is based.
Additional Information and Where to Find It
This document relates to a proposed transaction between Ginkgo and Soaring Eagle. This document does not constitute an offer to sell or exchange, or the
solicitation of an offer to buy or exchange, any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, sale or exchange would be unlawful prior to registration or qualification under the securities laws of
any such jurisdiction. In connection with the proposed transaction, Soaring Eagle filed a definitive proxy statement/prospectus (the Proxy Statement) on August 13, 2021. The Proxy Statement has been sent to all Soaring Eagle
shareholders as of August 10, 2021 (the Record Date). Soaring Eagle also will file other documents regarding the proposed transaction with the U.S. Securities & Exchange Commission (the SEC). Before making any
voting decision, investors and security holders of Soaring Eagle and Ginkgo are urged to read the registration statement, the Proxy Statement and all other relevant documents filed or that will be filed with the SEC in connection with the proposed
transaction as they become available because they will contain important information about the proposed transaction.
Investors and security holders may
obtain free copies of the Proxy Statement and all other relevant documents filed or that will be filed with the SEC by Soaring Eagle through the website maintained by the SEC at www.sec.gov. In addition, the documents filed by Soaring
Eagle may be obtained free of charge by written request to Soaring Eagle at 955 Fifth Avenue, New York, NY, 10075, Attention: Eli Baker, Chief Financial Officer, (310) 209-7280.
Participants in Solicitation
Soaring Eagles and
Ginkgo and their respective directors and officers may be deemed to be participants in the solicitation of proxies from Soaring Eagles stockholders in connection with the proposed transaction. Information about Soaring Eagles directors
and executive officers and their ownership of Soaring Eagles securities is set forth in Soaring Eagles filings with the SEC. To the extent that holdings of Soaring Eagles securities have changed since the amounts printed in Soaring
Eagles proxy statement, such changes have been or will be reflected on Statements of Change in Ownership on Form 4 filed with the SEC. Additional information regarding the interests of those persons and other persons who may be deemed
participants in the proposed transaction may be obtained by reading the Proxy Statement regarding the proposed transaction . You may obtain free copies of these documents as described in the preceding paragraph.
MEDIA CONTACT:
press@ginkgobioworks.com
INVESTOR CONTACT:
investors@ginkgobioworks.com
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