[HN Gopher] Ginkgo Bioworks (YC S14) is going public today
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Ginkgo Bioworks (YC S14) is going public today
Author : todsacerdoti
Score : 108 points
Date : 2021-09-17 16:15 UTC (6 hours ago)
(HTM) web link (blog.ycombinator.com)
(TXT) w3m dump (blog.ycombinator.com)
| tito wrote:
| If anyone will enable the world to engineer biology, it's Gingko.
|
| Their team has built a platform for biological engineering since
| day 1.
|
| This is the summary:
|
| * platform for engineering biology (unfair advantage is they've
| taken this "not a product company" approach since 2009)
|
| * investing up the ecosystem by taking upside in products they
| engineer for larger companies (not sure if they have an unfair
| advantage here besides creative financing and momentum, IPO helps
| with that)
|
| * investing downstream into startups by providing their platform
| in exchange for equity (YCbio partnership seems like an unfair
| advantage here)
|
| * mindshare of new minds (iGEM itself is a breeding ground for
| future synbio employees and leaders who dream of joining Ginkgo,
| Ginkgo founders co-created iGEM)
|
| Pretty perfect flywheel right there, even if it risks being a
| spaghetti monster from a corporate structure and cashflow
| standpoint.
|
| So cool to see this finally coming to light as an IPO. While I
| don't understand the SPAC benefits, Ginkgo's structure to be able
| to invest resources into synbio startups in an equity exchange
| sets them up really well for future cashflow even if the present
| is not.
|
| (Disclosure Ginkgo bought lab equipment from me in the early
| days, and I just bought their stock today)
| https://www.ginkgobioworks.com/2009/09/01/pearl-biotech-open...
| neural_thing wrote:
| I sold my Ginkgo today. I like the company but... Most of their
| revenue is stock in affiliated companies. I don't think they
| have a real business today, and the valuation is insane.
|
| Amyris actually has a synthetic biology business. It's less
| flashy but it's real.
| Kiro wrote:
| How come you had Ginkgo stocks?
| neural_thing wrote:
| I bought shares in the SPAC a few weeks ago, expected a
| jump on the IPO news, it worked out.
| subrat_rout wrote:
| How do you buy shares in the SPAC? Is there a minimum
| amount? Which platform can I use to buy shares in the
| SPAC?
| neural_thing wrote:
| SPACs are publicly traded. The announcement that Soaring
| Eagle was taking Ginkgo public was made in May.
| https://www.prnewswire.com/news-releases/ginkgo-bioworks-
| to-...
|
| No special access is needed to trade SPACs, just need to
| follow the news. That being said, I think that most SPACs
| are pretty bad deals.
| [deleted]
| fouc wrote:
| synbio.. wow, talk about flashbacks to genetic hacking cyber
| punk scifi
| murgindrag wrote:
| Serious question: How does YC work with companies like this?
|
| It seems like a YC standard-form offer doesn't make any sense to
| a company like Ginko at the stage it entered YC.
| ArtWomb wrote:
| Congrats! Great to see this from inception in 2014 to news
| recently that they work with Moderna to scale synthetic DNA
| vaccine production to global demand. I like Part Deux of their
| revenue stream: royalties. Taking equity stakes in spin off bio-
| engineered consumer products. And the best part for a biotech
| startup, faster regulatory approval than pharma ;)
| petra wrote:
| An interesting story about this from MIT technology review
| :https://www.google.com/amp/s/www.technologyreview.com/2021/0...
| g10r wrote:
| Here's one of their more recent decks if anyone is interested:
| https://www.ginkgobioworks.com/wp-content/uploads/2021/08/20...
| djhn wrote:
| Is there any centralised place for finding interesting decks?
|
| You'd think there would be a prolific Discord or telegram
| channel publishing interesting public or quasi-public
| documents?
| g10r wrote:
| Probably not...I just came across it as part of my diligence
| before investing. Originally found on Twitter.
| tlrobinson wrote:
| Congrats! The 7th YC company to IPO:
| https://www.ycombinator.com/topcompanies/
| adrr wrote:
| News says it was a SPAC and not an IPO.
| dannykwells wrote:
| Wow - YC has been around for 15 years and only 7 IPOs. That is
| an interesting track record.
| jy1 wrote:
| Also consider that YC at the start had few companies per
| batch. Also a tonne of large acquisitions.
| marc__1 wrote:
| That is very unfair.
|
| VC is a long-term business, with the _average_ time from
| founding to IPO ranging from 8-10 years depending on the
| year. If you look closer at this list, you 'll see companies
| about to IPO (Amplitude, Relativity Space, Embark Trucks) and
| several multi-billion dollar exits (e.g Segment <> Twilio,
| Twitch <> Amazon).
|
| Lastly, the business is all about power law, so these small
| exits outperform the remaining portfolio by orders of
| magnitude. I bet they are beyond excited with their returns.
| kilroy123 wrote:
| I'm currently looking seriously at creating a synthetic biology
| software startup. Like a poor mans ginkgo.
|
| These guys are MASSIVE in the space. Think Google back in the
| day.
|
| I predict this will be a hot stock.
|
| Edit: if you're also interested in starting synthetic biology
| startup please get in touch.
| cybernautique wrote:
| I'm interested, but in the it's-something-I-aspire-to-some-day-
| when-I'm-not-so-incompetent sense. However! I'd love to engage
| with you to hear about what's up! Is your inbox open to general
| curiosity, or would you rather keep emails limited to serious
| takers currently?
| kilroy123 wrote:
| Happy to chat with anyone. :)
| cinntaile wrote:
| At this point they're massively overvalued if you ask me, that
| seems to be the case for every synthetic biology company but
| this one takes the cake.
| kilroy123 wrote:
| I totally agree, but it seems like everything with a good
| story is overvalued these days.
| koeng wrote:
| I'm a major contributor to a synbio software package
| https://github.com/TimothyStiles/poly and I also do quite a lot
| of robotics in the space (have a full DNA foundry running in my
| house, that took a lot of software).
|
| Already starting something in the space, but I'd be happy to
| talk!
| agumonkey wrote:
| Ha Tom knight is back
| jc_811 wrote:
| I noticed they went public via SPAC, which, as an investor,
| screams red flag and scares me.
|
| Can anyone shed light on why they would go this route? Is it
| accurate to say best case is because they wanted less hassle /
| quicker to market and worst case is that their financials/books
| are a disaster and they didn't want anyone looking too closely
| before the founders raised money and cashed out?
|
| Genuinely curious and would appreciate any insightful replies
| jy1 wrote:
| Regular bankers dont want to IPO hard tech companies. SPACs are
| great for hard tech with future revenues.
| Kiro wrote:
| Isn't a SPAC just an empty shell? Why would they want to IPO
| that?
| jy1 wrote:
| The SPAC sponsors burden the risk, not the bankers.
| jc_811 wrote:
| What exactly is a "hard tech" company? And is this a recent
| change? Tech companies have been going public without issues
| for years until the last ~24 months when SPACs exploded (and
| mostly churn out negative returns after the initial pop [1])
|
| Isn't a standard IPO also great for a tech company with
| future revenues as long as you believe in your business and
| future prospect?
|
| Really trying to wrap my head around why a company would do
| this, and also why this isn't a huge red flag as well
|
| [1] https://news.bloomberglaw.com/bloomberg-law-
| analysis/analysi...
| jy1 wrote:
| It's not "hard tech" per se. Rather it's companies that are
| (essentially) pre-revenue and/or pre-product.
|
| E.g. Ginko did $100m in rev in 2021 and is at a 20B market
| cap.
|
| Why would a company do this? Simple: Money. Spac sponsors
| "guarantee" a ~20B market cap. Investment bankers in a
| regular IPO might offer $4-5B (still 50x sales).
|
| So what's the difference? Spac sponsors are willing to take
| "venture" style risk, and traditional IPO underwriters are
| not.
| sjg007 wrote:
| Umm. Spac management can "sell out" and gets coupons to
| buy stock so.. Does the SEC require the target company or
| the acquisition company file something akin to an S1
| filing for the target company or ?
| bpodgursky wrote:
| The market cap is $2.5B, not $20B.
|
| https://www.cnbc.com/2021/09/17/ginkgo-begins-trading-on-
| the...
| jy1 wrote:
| That link is wrong. It's closer to $20b. https://www.bloo
| mberg.com/news/articles/2021-05-11/ginkgo-sa...
| [deleted]
| jy1 wrote:
| Another way to think about this is: Traditional IPO
| underwrites are fairly risk adverse. They will value
| "high risk" companies in certain ways. E.g. How would you
| value a self driving company with 0 revenue? For bankers?
| pretty conservatively.
|
| However the "market" has people that can and will value
| these companies more than IPO underwriters. Spac sponsors
| are essentially glorified "venture" style investments,
| that also happen to take the company public (and take a
| fairly large cut in return).
|
| An alternative might be to have a "direct listing"
| without underwriters, however companies are unable to
| raise funds in a direct listing.
| neural_thing wrote:
| Most of the answers here are wrong. The real reason is that
| when companies go public through a regular IPO, they can't show
| projected financials, only actual results.
|
| Ginkgo has poor results so far, but huge projections, which a
| fair number of people believe. So, SPAC.
| neural_thing wrote:
| See this for example - https://www.ginkgobioworks.com/wp-
| content/uploads/2021/05/Gi... They had 18% revenue growth in
| 2020 but project 75%+ revenue growth through 2025. If you do
| a regular IPO, you can't post numbers like this
| kharak wrote:
| I don't really understand SPACs. Is there a good article
| explaining what they do and why you take them instead of going
| public directly. And what happens to those SPAC shares now if
| you bought some?
| fsn4dN69ey wrote:
| Plenty of material on SPACs online, but per your question,
| the shares of the spac (SRNG) convert to the target (DNA). If
| you had units (SRNGU), you also got 1 share (DNA) + 1/5
| warrant (DNA.W) per unit.
| g10r wrote:
| Was nice to have the ability to buy into SRNG early. This
| is more or less restricted to most through a traditional
| IPO.
| [deleted]
| irq-1 wrote:
| That does seem bad.
|
| https://www.sec.gov/oiea/investor-alerts-and-bulletins/what-...
|
| > If you invest in a SPAC at the IPO stage, you are relying on
| the management team that formed the SPAC, often referred to as
| the sponsor(s), as the SPAC looks to acquire or combine with an
| operating company. That acquisition or combination is known as
| the initial business combination. A SPAC may identify in its
| IPO prospectus a specific industry or business that it will
| target as it seeks to combine with an operating company, but it
| is not obligated to pursue a target in the identified industry.
| g10r wrote:
| It's not bad per se, it's just how it works. Like pretty much
| everything in life the outcome is dependent on the people
| involved. You're not getting the potential for more upside
| without the introduction of more risk.
|
| Chamath is currently leading four biotech SPACS: DNAA, DNAB,
| DNAC and DNAD, each with a stated target, neurology,
| oncology, organs & immunology. Anyone looking to invest in
| the SPAC today should consider the likelihood of this
| happening, the potential targets, and the sponsors history.
|
| Or you can wait for an announcement around a proposed merger,
| even up to the day the official stock starts being traded.
|
| Again, just depends on risk tolerance. It's nice to least
| have the option to take part in these deals.
| gingkoguy wrote:
| They are a great company and could have gone traditional IPO.
| However, with going SPAC they were able to bring 2 billion
| dollars into a company with super high valuation. They make
| less than 50mil and we're valued at 18 to 20 billion. So don't
| buy in now, you will have plenty of chance to buy this great
| company
|
| Edit: Also just to add on by bringing in that 2 Billion dollars
| they have essentially secured the future of the company for a
| long time
| bpodgursky wrote:
| SPACs are a great way to not have to hemorrhage IPO money to
| wall street bank cartels, and to lose billions w/ undervalued
| IPOs. I'm not sure what you're on about.
| dang wrote:
| Please omit swipes from your posts to HN. Your comment would
| be fine without that last bit.
|
| https://news.ycombinator.com/newsguidelines.html
| mmiyer wrote:
| Their books don't look that good per this article:
| https://www.technologyreview.com/2021/08/24/1032308/is-ginkg...
| lr wrote:
| Robinhood currently has the Genentech description attached to
| Ginko Bioworks (DNA)!
| skosuri wrote:
| Congrats @jrkelly and team! Exciting day for synthetic biology,
| and love the pictures of the NYSE:
| https://twitter.com/Ginkgo/status/1438837881649381377?s=20
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