grab spac investor presentation

5 questions about Grab’s epic SPAC investor deck

As expected, Southeast Asian superapp Grab is going public via a SPAC.

The combination, which TechCrunch discussed over the weekend , will value Grab on an equity basis at $39.6 billion and will provide around $4.5 billion in cash, $4 billion of which will come in the form of a private investment in public equity, or PIPE. Altimeter Capital is putting up $750 million in the PIPE — fitting, as Grab is merging with one of Altimeter’s SPACs.

Grab, which provides ride-hailing, payments and food delivery, will trade under the ticker symbol “GRAB” on Nasdaq when the deal closes. The announcement comes a day after Uber told its investors it was seeing recovery in certain transactions, including ride-hailing and delivery.

Uber also told the investing public that it’s still on track to reach adjusted EBITDA profitability in Q4 2021. The American ride-hailing giant did a surprising amount of work clearing brush for the Grab deal. Extra Crunch examined Uber’s ramp toward profitability yesterday .

This morning, let’s talk through several key points from Grab’s SPAC investor deck. We’ll discuss growth, segment profitability, aggregate costs and COVID-19, among other factors. You can read along in the presentation here .

How harshly did COVID-19 impact the business?

The impact on Grab’s operations from COVID-19 resembles what happened to Uber in that the company’s deliveries business had a stellar 2020, while its ride-hailing business did not.

From a high level, Grab’s gross merchandise volume (GMV) was essentially flat from 2019 to 2020, rising from $12.2 billion to $12.5 billion. However, the company did manage to greatly boost its adjusted net revenue over the same period, which rose from $1 billion to $1.6 billion.

Inside of the company’s business units, ups and downs were stark. After deliveries GMV grew from $600 million to $2.9 billion to $5.5 billion from 2018 to 2020; Grab’s rides business GMV grew from $4.6 billion to $5.7 billion in 2018 and 2019, only to tumble to $3.2 billion in 2020.

However, Grab’s overall business was more profitable in 2020 than 2019, seeing its post-combination EBITDA loss narrow from -$2.3 billion in 2019 to -$800 million in 2020.

In short, Grab’s transportation business was hit hard due to COVID, its delivery efforts soared, and the company grew while losing less money.

Which segments are profitable?

Grab has four businesses, of which two — ride-hailing and deliveries — account for the vast majority of its revenues. The company’s financial business generates comparatively modest revenues when stacked against its more established efforts.

Financial services brought in around $200 million in revenue during both 2019 and 2020. However, the segment’s EBITDA losses of $400 million in 2020 mattered. Grab’s deliveries business had a smaller $200 million 2020 EBITDA loss, and its rides business generated $300 million in 2020 EBITDA. (All figures in this section are post -InterCo, taking into account the impact of the transaction, which will eliminate the impacts of “intragroup transactions.”)

Grab’s “Enterprise & Others” segment generates effectively no revenues and has a negligible impact on profitability. It can be ignored.

In short, ride-sharing is a profitable business for Grab, though the segment did take a pandemic-induced whacking; deliveries form a rapidly growing segment at the company that has greatly improved in profitability terms — in 2020, it lost just 25% of its 2019 negative adjusted EBITDA. And Grab’s financial services business is a drag on its bottom line while not helping its top line much.

How close to breakeven is the company as a whole?

Not close at all. Considering its net income, Grab lost $2.7 billion in 2020. That was down from $4 billion in 2019, but up from its 2018 net loss of $2.5 billion.

The caveat is that quite a lot of the company’s recent net losses stem from costs sourced from redeemable convertible preferred stock, or RCPS. That expense, a form of interest, came to $1.1 billion in 2019 and $1.4 billion in 2020. Given that RCPS is, to our understanding, a non-cash cost, how much investors will mind the implied dilution in the company’s net losses and thus be willing to forgive some of their scale, is not clear.

Even discounting 100% of its RCPS expense, the company’s net loss was still greater than $1 billion last year.

What sort of growth does Grab anticipate?

Here’s the chart:

You can see the COVID-19 impact on Grab’s GMV in the first chart. From here, the company expects total platform spend to grow rapidly. And that results in pretty strong net revenue growth.

Do note that the company does not expect its adjusted net revenue as a percentage of GMV to grow after 2021 — Grab actually anticipates adjusted net revenue to decline to 13% of GMV in 2022 after rising to 14% in 2021.

Still, the company expects a 40% compound annual growth rate (CAGR) in GMV from 2020 to 2023, and a 42% CAGR of adjusted net revenue over the same time period. That’s pretty good given the company’s scale, but a drastic slowdown from its pre-2021 growth pace of 96% CAGR.

What SPAC-ish shenanigans do we need to understand?

Oh boy. Well, let’s start with one of the numbers we just talked about: adjusted net revenue. What is that? Well net revenue is the company’s gross billings minus “Drivers and Merchants Base Incentives” and “Drivers and Merchants Excess Incentives.” Adjusted net revenue adds back in the second category of incentive.

Here’s how Grab defines the bucket:

Adjusted Net Revenue is a non-IFRS financial measure, which adjusts our net revenue by adding back excess incentives. Excess incentives occur when payments made to driver/merchant partners exceed Grab’s revenue received from such driver/merchant partners (excess incentives are calculated on a monthly basis for each country and not on a driver-by-driver basis).

So when Grab overpays someone, it doesn’t want that to count against its revenue. Sure. Cool. Judge that as you will, but reading this Grab deck, it is impossible to not get shades of the same joy that one beholds when trying to parse Uber’s earnings.

Finally, pay attention to the charts that show pre- InterCo data — the company’s performance before it was consolidated — and the tables that adjust for things that won’t stick around post-combination. The charts are often prettier than the tables. The charts, in essence, are what the company told itself before the deal. The tables, like the dataset featured on page 26 of the presentation, undercut some of Grab’s own hype.

Overall, this is a fun deal that will be exciting to see trade.

Ride-hailing’s profitability promise is in its final countdown

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Grab to unveil world’s biggest SPAC merger, valued at nearly $40 bln - sources

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• Grab agrees merger with Altimeter Growth Corp
• Deal to provide Grab with about $4.5 bln in cash proceeds
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Commentary commentary

Commentary: Why Grab is in such a rush to get listed

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commentary Commentary

CEO Anthony Tan is in a rush to build Grab into a super app and achieve profitability, and the company’s listings will help him do that without too much public scrutiny, say IMD Business School’s Howard Yu and Angelo Boutalikakis.

A man walks past a Grab office in Singapore. (File photo: Reuters/Edgar Su)

LAUSANNE: Grab battled Uber. It survived a merger fallout with Gojek. It coaxed tolerance out of regulators in a fragmented region of Southeast Asia. 

Most recently, the Securities and Exchange Commission (SEC) has threatened to put a brake on the frantic SPAC (special purpose acquisition companies) activities. Despite all this, Grab managed to land a US$40 billion merger with the US-based Altimeter Capital.

“You need to be hyper paranoid and constantly thinking that the guy on your right is trying to murder you,” CEO Anthony Tan of Grab said in an interview with Financial Times in 2014.

READ: Commentary: Anthony Tan, the ‘unabashedly ambitious’ man behind Grab

His paranoia has been justified - Anthony is restless. His “workhorse” nature has been known since his days at Harvard Business School. He has been seen taking calls and reading case studies while running on a treadmill.

What he’s running against now is time. He needs Grab to become a super app before others. He needs to do so before Grab’s core business shows any signs of plateauing.

TOO MUCH MONEY IS CHASING TOO FEW GREAT IDEAS

The rise of SPACs is closely tied to one of the biggest wealth transfers of modern economic times. The purpose of a SPAC is to raise capital through an initial public offering (IPO).

Only later will a SPAC buy a start-up. 

READ: Commentary: Grab’s blockbuster deal comes at questionable time for SPAC market

In this twisted arrangement, the start-up can effectively bypass all the compliance hurdles of a traditional IPO. 

There’s no public scrutiny of financial disclosure and no formal filing of a detailed prospectus in the form of S-1. That’s why SPACs are referred to as blank cheque companies. They give whatever a start-up needs without asking too many questions.

For instance, through a regular IPO, Mr Tan would have faced lots of challenges in securing his 60.4 per cent voting rights that he has once the company is listed even though he only owns 2.2 per cent of ordinary shares. 

The recent experiences of the founders of WeWork and Deliveroo show that investors can scupper such disproportionate control of power in an IPO.  

During most of financial history, SPACs had been a minor play. After all, what respectable investors are going to put money in a shell company in the hope that it would one day successfully pick a high-flying unicorn? But the COVID-19 crisis changed all that.

Multi-trillion-dollar stimulus packages have flooded the market with liquidity never seen before. The record highs of Dow Jones and Nasdaq mean that the wealthy - family offices and hedge funds -have become obscenely wealthier. 

READ: Commentary: Deliveroo’s IPO is a lesson to not underestimate investors

Meanwhile, the number of publicly listed companies has been dropping over the last three decades, dropping from 8,000 to just over 4,000 today. All that money needs to find new investment opportunities.

So, Altimeter Capital becomes the blank cheque company for Grab. And in this deal, Grab will receive a maximum of about US$4.5 billion in cash from the SPAC merger.

A BIG BUSINESS THAT MAKES NO MONEY  

For Grab though, there may be other reasons why the SPAC route was preferred, to escape public scrutiny over financial disclosure compulsory under an IPO.

For venture capitalists or the financial market, no business model is more attractive than a platform - a marketplace that enables the exchange of goods or services and has purported “network effects”.

READ: Commentary: What’s behind Grab’s reported SPAC listing

This so-called network effect has been a common refrain among economists and academics to explain the spectacular growth of these businesses. 

They argue the more people use a platform, the more inherently attractive it becomes, leading even more people to use it. And once a platform reaches a certain size, it becomes too dominant to unseat.

The problem is this argument ignores the profitability issue. In ride-sharing, it turns out that the mere presence of one additional competitor can lead to ruinous, undifferentiated competition.

Plus ride-sharing’s network effect is also limited within one location. For instance, if you are using Grab in Singapore, you don’t necessarily care about the service level in Manila.

This is unlike Facebook, which has a global network. It is also difficult for another company to give Airbnb, for example, a run for its money as that competitor needs to have a global reach and network that Airbnb has. For companies like Grab, competition can easily spring up locally.

Advertisers like P&G or Nike actually care a lot about the size of Facebook’s audience from London to Hong Kong and so companies like Grab who don’t have that global network lose out on large advertising money.

As a result of a more open playing field locally, ride-sharing can easily succumb to a price war. Discount coupons and driver incentives quickly eat into profit margins.

That’s how Grab, Gojek, Uber, and Lyft have lost money.

But Uber in Southeast Asia is no more. And so the bleeding on that front has stopped.

Yet here is exactly why Grab prefers the SPAC route. According to the details revealed in its investor presentation , Grab will have to shave off hundreds of millions of dollars each year, in order to reach profitability. 

It only aims to get to positive EBITDA (earnings before interest, tax, depreciation and amortisation) in 2023.

READ: Commentary: What is the logic of AirAsia entering Singapore’s food delivery market?

Read: commentary: the gig economy – a surprise boost from the pandemic and in singapore, it’s not going anywhere.

How will it do that? Grab’s ride-hailing business – which achieved positive EBITDA just last year - shows the way. 

Already, to save costs in 2020, it may have cut off more than S$600 million worth of incentives for drivers and merchants – a figure larger than the increase it earned in billings that year.

No surprises then if Grab slashes incentives further to achieve the targeted profitability in the next few years. Such information, if disclosed through an IPO prospectus, may have seen a public backlash, which could have affected its listing returns or share pricing.

The question is, can Grab still maintain market share in the currently loss-making food delivery business if it cuts incentives? Why wouldn’t Foodpanda, Deliveroo and others swoop in to scoop up the clientele? Why wouldn’t people simply switch when Foodpanda has full-time deliverers on shifts and therefore may be potentially more reliable?

Regardless, these shaky profitability concerns are also why Mr Tan must move Grab into online food delivery, which since last year is now the biggest contributor to the company’s revenue.

This brings us to Grab’s second listing in Singapore.

FINTECH IS WHERE THE MONEY LIES

Today, Grab is expanding into a “super app.” It offers everything from food and parcel delivery to hotels and airline bookings and access to financial and health services. But being a super app can’t promise profitability; only being in the financial sector does.

It’s a sector full of slow-moving incumbents - and one stuck with obscenely high margins. And most attractive of all, it’s an industry teeming with paperwork and manual processes that should have been automated through technologies decades ago.

And Singapore, being the financial hub, will be Grab’s toehold for its financial service ambition. It has already acquired a banking license together with Singtel.

READ: Commentary: Why a bumper crop of Southeast Asian tech unicorns look set to IPO this year

That’s also why Mr Tan is also considering a second listing in Singapore. He doesn’t need additional money, but a second listing will buy him goodwill from the Singapore Government.

Grab has already acquired a banking license together with Singtel in Singapore, which as a financial hub, will be Grab’s toehold for its financial service ambition. However, Grab will need ongoing accommodation from regulators to navigate any resistance from traditional banks.

Since the company has sufficient cash reserves, it would only raise a small amount on the SGX, but this very symbolic listing would mark a big win for the Singapore Exchange. 

The deal will put SGX in the international spotlight to rival its bigger counterpart of Hong Kong.

Because in Asia, you “had to work with individual government stakeholders, people of power and influence, in the highest echelons,” said Anthony. 

It’s never too early to buy public goodwill.

Howard Yu is the author of  LEAP: How to Thrive in a World Where Everything Can Be Copied  (PublicAffairs; June 2018), LEGO professor of management and innovation at the IMD Business School in Switzerland, and director of IMD’s signature Advanced Management Program. Angelo Boutalikakis is a research associate at Center for Future Readiness at IMD Business School in Switzerland and Singapore.

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Grab shares sink in historic Nasdaq debut as president touts the cross-selling opportunities of its super app strategy

After an initial jump on Thursday, shares of Grab slumped more than 20% in their Nasdaq trading debut after the ride-hailing and delivery app merged with U.S. blank-check firm Altimeter Growth Corp in a special purpose acquisition company—or SPAC—deal valued at $40 billion, the largest ever. The $4.5 billion Grab raised in the deal makes it the largest IPO by a Southeast Asian company in U.S. history.

The listing caps a rapid ascent for the startup that entrepreneurs Anthony Tan and Tan Hooi Ling launched as MyTeksi in Malaysia less than a decade ago. The pair, who are unrelated, founded the company with $25,000 that included prize money they’d won by entering their ride-hailing idea in Harvard Business School’s New Venture Competition in 2011.

Nine years and $12 billion in investments later, Singapore-based Grab now operates in nearly 470 cities across eight Southeast Asian markets, employs 700,000 drivers, and offers food delivery, payments and financial services—in addition to ride-hailing—to 187 million users.

Grab hopes its public debut will shine a “big spotlight” on the region and its market opportunities, says company president Ming Maa. Driven by its young, digitally-savvy and mobile-first populations, Southeast Asia is “on the cusp of a digital revolution,” says Maa.

But now that Grab is a public company, investors will be watching to see whether it can maintain its lofty goal of being an all-in-one-super app, wean its drivers and users off promotions, and—at some point—turn a profit. On Wednesday evening, Fortune spoke with Singapore-based Maa via video call about Grab’s business strategy and its plans ahead.

Fortune: Can you walk me through Grab’s plans to become profitable? Grab’s third quarter results last month showed losses of $988 million, despite steady growth in gross merchandise value (GMV), which ballooned to a record $4 billion in Q3. Market research firm Euromonitor said in a July report that a key weakness is Grab’s big spending on advertising, promotions and incentives, and that a challenge going forward is whether the company can make money and maintain customer loyalty without such discounts.

Maa: We don’t see profitability and growth as mutually exclusive. In Q3, we posted our third consecutive quarter of record GMV growth. We’ve also made very good strides on improving our economics. Our mobility segment has been positive since Q4 2019 and our margins are industry-leading [in that sector].

Our deliveries business—which is much younger at three years old—is already breaking even in a majority of our markets.

Our key is driving our super app strategy, which allows us to cross-sell new services when we roll them out, while maintaining discipline around our marketing costs. [It] also allows [Grab] drivers to earn more via [new] income opportunities [when ride-hailing is down] and helps us maintain discipline around [spending on] driver incentives. So the super app is really key to driving the new economics of our business.

Grab has several different business segments—which ones are your top priorities at the moment?

If you think about the long-term opportunities within Southeast Asia, [we’re] focused on three. The first is around continuing to deepen our delivery business. Whenever someone’s hungry, wants a restaurant meal, groceries to cook at home or potato chips for a snack on a Friday night, we want them to think of Grab first. So we’ll continue investing in deliveries.

The second is all around financial inclusion—continuing to drive affordability and accessibility of our financial services products. The way we do that is focusing on microinsurance, microlending and microsavings products that [are more] affordable [for the consumer in Southeast Asia]. The analogy I like to use is that in the U.S. you can buy a toothpaste that’s eight ounces; but in developing markets, they usually sell one ounce or two ounce toothpastes. We’re doing the same thing—creating bite-sized toothpastes for financial services.

The digital bank opportunity is very exciting. [Last year, the Monetary Authority of Singapore awarded Grab and telecommunications partner SingTel a license to set up a digital bank, which will launch next year]. Even in a developed country like Singapore, when you speak to consumers and SMEs on the ground, there’s a tremendous amount of underserved opportunities. Affordability, accessibility, and transparency is really key. And we want to make digital banking as easy as ordering a Grab ride. 

Lastly, [we] continue to build infrastructure to support e-commerce, whether through our logistics network providing on-demand deliveries—we now operate the largest driver delivery network—or through our “buy now, pay later” services, which is very important in [this] region [since] credit card penetration is very low, at 10%. So for the remaining 90% of the population, this is the solution.

How will Grab fare against regional competitors? Indonesia’s GoTo—another Southeast Asian super app that formed this May when ride-hailing giant Gojek merged with e-commerce platform Tokopedia—is often cited as one of Grab’s most formidable regional competitor.

We’ve been blessed to have good competitors for the last nine years. Frankly, competition is good for consumers and the overall market. But we’re the only company that operates a regional super app. We got to where we are by focusing on tech investments. We invested quite a bit in our own mapping and routing. In some countries, there’s these little alleyways that aren’t on the maps. This helps us deliver items to people faster and more reliably than other companies. It’s also core to thinking about developing a shared driver fleet; what allows us to create the largest delivery network at the lowest cost. And the lowest cost delivery network is what drives long-term sustainability.

Can you share more about Grab’s plans in the year ahead? Will the company expand to more markets in Asia, or worldwide?

We are absolutely laser focused on Southeast Asia. It’s just day one of many long-term opportunities here. We want to drive the adoption and penetration of digital services here.

Has all the uncertainty surrounding the new Omicron COVID variant changed Grab’s strategy or outlook for the year ahead?

[In September], we did [write] down our forecasts for the year. But keep in mind that this was in a market environment where we had the Delta variant coming across Southeast Asia. We had a series of lockdowns [here]. Our revision was really out of an abundance of caution, rather than any weakness in the business itself.

It’s a bit too early to tell [about Omicron]. What’s changed in recent months is that we’ve seen vaccinations improve dramatically. We’ve seen most governments transition from a [zero-COVID] policy , which required strict lockdowns, to a policy of living with COVID as an endemic part of life. We’re starting to see cities open up, which is positive and will lead to a more constructive environment for the end of 2021 ,as well as leading into 2022.

This story has been updated to reflect Grab’s slump in later trading on Thursday.

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Grab CEO confident Spac merger to close by year-end after delay

SINGAPORE (BLOOMBERG) - Grab Holdings chief executive Anthony Tan said he is confident the merger of the ride-hailing and food-delivery giant and a United States blank cheque company will be completed by year-end, following a delay caused by a review of its financials.

The Singapore-based start-up last week postponed the expected completion of the deal with Altimeter Growth Corp - set to be one of the largest-ever mergers with a special purpose acquisition company (Spac) - to the fourth quarter as it works on an audit of the past three years. When announcing the pact in April, Grab said in an investor presentation that its completion target was next month.

"We decided to be proactive," Mr Tan said in an interview with Bloomberg Television. "We wanted to set the bar in transparent financial reporting. It may have taken a little longer than we expected."

Grab, which operates across South-east Asia, is the latest company to be affected by intensifying scrutiny from US financial regulators on deals involving Spacs. After a frenzy of listings, the Spac market has been hit by a crackdown by the US Securities and Exchange Commission (SEC) as well as lawsuits from shareholders, falling stock prices and delays in planned listings.

The SEC's scrutiny on how accounting rules apply to a key element of blank cheque companies has prompted restatement filings. The regulator has said that Spacs may need to account for warrants - securities issued to early investors - as liabilities, rather than as equity.

Mr Tan, 39, declined to comment when asked if he expects any major restatements by Grab following the financial audit.

He did not rule out a secondary listing in Grab's home market of Singapore, saying that the company considers all options. But he said Grab is "laser-focused" on the Nasdaq listing via the Altimeter merger that values the combination at about US$40 billion (S$53 billion).

The CEO said Grab considered a traditional initial public offering, but opted for a deal with Mr Brad Gerstner's Altimeter after seeing the commitment by the Spac partner. Altimeter has committed to a three-year lock-up period.

"They put their money where their mouth is," he said.

Some analysts have questioned Grab's targeted valuation. Bloomberg Intelligence analyst Matthew Kanterman calculates that Grab's enterprise value-to-sales ratio is more than double those of ride-sharing peers Uber Technologies and Lyft, "giving it scant wiggle room for missteps".

When asked if the US$40 billion valuation may be too stretched, Mr Tan declined to give a direct answer.

"We are excited that Grab is an early one to represent South-east Asia on a global stage," he said.

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Grab, the Leading Superapp for Deliveries, Mobility and Financial Services in Southeast Asia, Plans to Go Public in Partnership with Altimeter

Excerpt here. allow the user to have fully control on excerpt.

Grab Holdings Inc. (“Grab”), Southeast Asia’s leading superapp, today announced it intends to go public in the U.S. in partnership with Altimeter Growth Corp. (Nasdaq: “AGC”) in what is expected to be the largest-ever U.S. equity offering by a Southeast Asian company. The combined company expects its securities will be traded on NASDAQ under the symbol “GRAB” in the coming months.

• Grab is relied on for everyday needs in Southeast Asia and is the category leader for online food delivery, ride-hailing and digital wallet payments [2] in the region 
• Public listing will reinforce Grab’s strong business momentum including Gross Merchandise Value of approximately US$12.5 billion in 2020, surpassing pre-pandemic levels
• The proposed transactions represent an expected equity value on a pro-forma basis of approximately US$39.6 billion and are expected to provide up to approximately US$4.5 billion in cash proceeds to Grab
• Proceeds include more than US$4.0 billion of fully committed PIPE led by US$750 million from funds managed by Altimeter Capital Management, LP
• Investors in the PIPE include funds and accounts managed or advised by BlackRock, Counterpoint Global (Morgan Stanley Investment Management) and T.Rowe Price Associates, Inc., as well as Fidelity International, Fidelity Management and Research LLC, Janus Henderson Investors, Mubadala, Nuveen, Permodalan Nasional Berhad and Temasek  
• Altimeter commits to a three-year lock-up period for its sponsor promote shares, 10% of which will go to the recently announced GrabForGood Fund to support programs with long-term social and environmental impact

SINGAPORE AND MENLO PARK, CALIF. – April 13, 2021 – Grab Holdings Inc. (“Grab”), Southeast Asia’s leading superapp [1] , today announced it intends to go public in the U.S. in partnership with Altimeter Growth Corp. (Nasdaq: “AGC”) in what is expected to be the largest-ever U.S. equity offering by a Southeast Asian company. The combined company expects its securities will be traded on NASDAQ under the symbol “GRAB” in the coming months. 

The proposed transactions value Grab at an initial pro-forma equity value of approximately US$39.6 billion at a PIPE size of more than US$4.0 billion and will provide Grab with approximately US$4.5 billion in cash proceeds. Grab is a superapp dedicated to serving everyday needs and everyday entrepreneurs. It offers services across mobility, deliveries, financial services and more, in an all-in-one app.

Anthony Tan, Group CEO and Co-founder, Grab said, “It gives us immense pride to represent Southeast Asia in the global public markets. This is a milestone in our journey to open up access for everyone to benefit from the digital economy. This is even more critical as our region recovers from COVID-19. It was very challenging for us too, but it taught us immensely about the resiliency of our business. Our diversified superapp strategy helped our driver-partners pivot to deliveries, and enabled us to deliver growth while improving profitability. As we become a publicly-traded company, we’ll work even harder to create economic empowerment for our communities, because when Southeast Asia succeeds, Grab succeeds.”

Brad Gerstner, Founder and CEO, Altimeter said, “As one of the world’s largest and fastest-growing internet companies, Grab is paving the digital path forward for the 670 million citizens of Southeast Asia. We are thrilled that Grab selected Altimeter Capital Markets as their partner to go public and even more excited to become sizable long term owners in this innovative, mission driven company.”    

Southeast Asia is one of the fastest growing digital economies in the world, with a population approximately twice the size of the United States. Yet online penetration for food delivery, on-demand mobility and electronic transactions are a fraction of the U.S. and China. Across online food delivery, ride-hailing and digital wallet payments, Grab expects its total addressable market to grow from approximately US$52 billion in 2020 to more than US$180 billion by 2025 [3] .

Grab believes it is perfectly positioned to serve the needs of consumers, merchants and drivers in Southeast Asia through its superapp strategy. It offers an ecosystem of complementary services, addressing high-frequency, everyday needs, all through one app. This creates a flywheel effect designed to drive growth while lowering cost of service. The more services offered, the more the choices, and consequently the greater the value to consumers using the Grab superapp. In fact, the proportion of Grab users that use 2 or more services has grown 5 times over the last two years [4] . As consumer spend grows, so do the income opportunities for Grab’s merchant and driver-partners, encouraging more of them into Grab’s ecosystem. This leads to wider selection, better value, and faster delivery times for users, with benefits to consumer loyalty and lifetime value. 

Grab’s decision to become a public company was driven by strong financial performance in 2020, despite COVID-19. Grab posted GMV of approximately US$12.5 billion in 2020, surpassing pre-pandemic levels and more than doubling from 2018. The company is also currently the category leader in Southeast Asia for its core verticals [5] , accounting for approximately 72% of total regional GMV for ride-hailing, 50% of total regional GMV for online food delivery and 23% of regional TPV for digital wallet payments in 2020. 

At the same time, the company has made significant strides towards profitability, with a key focus on building a resilient business and delivering sustainable growth, achieving positive segment EBITDA [6] in mobility across all markets, and positive segment EBITDA in deliveries in 5 out of 6 countries.

Proposed Transactions Overview 

Grab’s journey to becoming a U.S.-listed public company will be facilitated by a definitive business combination agreement between Grab and Altimeter Growth, a special purpose acquisition company. Pursuant to the proposed transactions, Altimeter Growth and Grab will become wholly-owned subsidiaries of a new holding company. The combined company is expected to have an equity value on a pro-forma basis of approximately US$39.6 billion.

At closing, the combined company is expected to receive approximately US$4.5 billion in cash proceeds, including more than US$4.0 billion from a fully committed PIPE offering that was upsized due to significant investor interest. Furthermore, Altimeter has also committed up to US$500 million to a contingent investment to be equal to the aggregate dollar amount of redemptions from Altimeter Growth’s shareholders. The PIPE was led by funds managed by Altimeter Capital Management, LP which committed US$750 million, with participation from funds and accounts managed or advised by BlackRock, Counterpoint Global (Morgan Stanley Investment Management), and T.Rowe Price Associates, Inc., as well as Fidelity International, Fidelity Management and Research LLC, Janus Henderson Investors, Mubadala, Nuveen, Permodalan Nasional Berhad and Temasek. Leading family groups from Indonesia including Djarum, the Sariaatmadja family and Sinar Mas also participated in the PIPE.

As part of Altimeter’s long-term commitment to Grab, Altimeter’s sponsor promote shares are    subject to a 3-year lock-up period. Altimeter is also donating 10% of its sponsor promote shares to support the GrabForGood fund, which aims to introduce programs with long-term social and environmental impact, including education, financial support for underserved communities and environmental issues. The GrabForGood fund was announced last week with an initial fund size of US$275 million, including a personal contribution of US$25 million in Grab shares from Grab Group CEO and co-founder Anthony Tan, together with co-founder Hooi Ling Tan and President Ming Maa.

Tan added, “We’ve always believed in long-term partnerships to drive impact at scale. We work closely with governments to support their national agendas, and have partnered with some of the world’s best blue chip companies. Altimeter is investing in a way that demonstrates our aligned values, with a three-year lock-up on their sponsor promote shares and unprecedented contribution of shares to our new GrabForGood endowment fund. They’re joining our journey for the long-run, together with an incredible day one cap table of renowned institutional investors and sovereign wealth funds. This is testament to the global investment community’s belief in the long-term value proposition of Grab’s superapp strategy and the exciting growth potential of Southeast Asia.”

The proposed transactions, which have been approved by the boards of directors of both Grab and Altimeter Growth, are expected to close in the coming months, subject to shareholder approvals, and other customary closing conditions. 

Investor Resources

Additional information is available on the Grab Investor Relations website at www.grab.com/investors , including a presentation of Grab’s business and the transaction details. The presentation will be available beginning April 13, 2021 at 6.00 am ET. Speakers include the senior management team at Grab, including Anthony Tan, Group CEO and Co-Founder of Grab, Ming Maa, President of Grab, Peter Oey, CFO of Grab, and Brad Gerstner, Founder and CEO of Altimeter. 

Altimeter Growth will also be filing a Current Report on Form 8-K, which will include a copy of the business combination agreement and the investor presentation, with the Securities and Exchange Commission available at www.sec.gov . 

Evercore acted as lead financial advisor to Grab. J.P. Morgan and Morgan Stanley Asia (Singapore) Pte were co-advisors. 

J.P. Morgan and Morgan Stanley & Co. LLC acted as lead placement agents, with Evercore and UBS as co-placement agents to Altimeter Growth on the PIPE.

Skadden, Arps, Slate, Meagher & Flom LLP and Hughes Hubbard & Reed LLP acted as legal advisors to Grab.

Ropes & Gray LLP acted as legal advisor to Altimeter Growth. Wilmer Cutler Pickering Hale and Dorr LLP acts as advisor to Altimeter Capital Management LP and Altimeter Capital Markets, which includes Altimeter Growth.

Cooley LLP acted as legal advisor to the placement agents.

Grab is the leading superapp platform in Southeast Asia, providing everyday services that matter to consumers. Today, the Grab app has been downloaded onto millions of mobile devices, giving users access to over 9 million drivers, merchants, and agents. Grab offers a wide range of on-demand services in the region, including mobility, food, package and grocery delivery services, mobile payments, and financial services across 428 cities in eight countries.

About Altimeter

Altimeter Capital Management, LP is a leading technology-focused investment firm built by founders for founders with over $15 billion in assets under management.  Altimeter’s mission is to help visionary entrepreneurs build iconic companies, disrupt markets and improve lives through all stages of growth.  Altimeter manages a variety of venture and public funds and serves as an expert long-term partner to companies as they enter the public markets. 

[1] Based on category leadership in online food delivery, ride-hailing and digital wallet. Category leadership assessed by Euromonitor, based on share of GMV and Total Payment Volume (TPV) for 2020. ‘Southeast Asia’ refers to the 6 largest markets in the region only: Indonesia, Malaysia, Singapore, Thailand, Philippines, and Vietnam

[2] Source: Euromonitor. Based on share of GMV in online food delivery and ride-hailing, and share of TPV for digital wallet payments, across Indonesia, Malaysia, Singapore, Thailand, Philippines and Vietnam

[3] Source: Euromonitor. Includes online food delivery, ride-hailing, and digital wallet markets

[4] Source: Grab data, based on Monthly Transacting Users

[5] Source: Euromonitor. Based on share of GMV in online food delivery and ride-hailing, and share of TPV for digital wallet payments, across Indonesia, Malaysia, Singapore, Thailand, Philippines and Vietnam

[6] Segment EBITDA is a non-GAAP measure and excludes regional costs.

Contact Information

For inquiries regarding Grab, please contact: 

In Asia: [email protected]

In the United States: [email protected]  

Grab: [email protected]  

Blueshirt Group: [email protected]  

For inquiries regarding Altimeter, please contact: 

[email protected]

[email protected]  

Forward-Looking Statements

This document includes “forward-looking statements” within the meaning of the federal securities laws with respect to the proposed transaction between Grab Holdings Inc. (“Grab”), J1 Holdings Inc. (“PubCo”) and Altimeter Growth Corp. (“AGC”), and also contains certain financial forecasts and projections. All statements other than statements of historical fact contained in this document, including, but not limited to, statements as to future results of operations and financial position, planned products and services, business strategy and plans, objectives of management for future operations of Grab, market size and growth opportunities, competitive position, technological and market trends and the potential benefits and expectations related to the terms and timing of the proposed transactions, are forward-looking statements. Some of these forward-looking statements can be identified by the use of forward-looking words, including “anticipate,” “expect,” “suggests,” “plan,” “believe,” “intend,” “estimates,” “targets,” “projects,” “should,” “could,” “would,” “may,” “will,” “forecast” or other similar expressions. All forward-looking statements are based upon estimates and forecasts and reflect the views, assumptions, expectations, and opinions of AGC and Grab, which are all subject change due to various factors including, without limitation, changes in general economic conditions as a result of COVID-19. Any such estimates, assumptions, expectations, forecasts, views or opinions, whether or not identified in this document, should be regarded as indicative, preliminary and for illustrative purposes only and should not be relied upon as being necessarily indicative of future results.

The forward-looking statements and financial forecasts and projections contained in this document are subject to a number of factors, risks and uncertainties. Potential risks and uncertainties that could cause the actual results to differ materially from those expressed or implied by forward-looking statements include, but are not limited to, changes in domestic and foreign business, market, financial, political and legal conditions; the timing and structure of the business combination; changes to the proposed structure of the business combination that may be required or appropriate as a result of applicable laws or regulations; the inability of the parties to successfully or timely consummate the business combination, the PIPE investment and other transactions in connection therewith, including as a result of the COVID-19 pandemic or the risk that any regulatory approvals are not obtained, are delayed or are subject to unanticipated conditions that could adversely affect the combined company or the expected benefits of the business combination or that the approval of the shareholders of AGC or Grab is not obtained; the risk that the business combination disrupts current plans and operations of AGC or Grab as a result of the announcement and consummation of the business combination; the ability of Grab to grow and manage growth profitably and retain its key employees including its chief executive officer and executive team; the inability to obtain or maintain the listing of the post-acquisition company’s securities on Nasdaq following the business combination; failure to realize the anticipated benefits of business combination; risk relating to the uncertainty of the projected financial information with respect to Grab; the amount of redemption requests made by AGC’s shareholders and the amount of funds available in the AGC trust account; the overall level of demand for Grab’s services; general economic conditions and other factors affecting Grab’s business; Grab’s ability to implement its business strategy; Grab’s ability to manage expenses; changes in applicable laws and governmental regulation and the impact of such changes on Grab’s business, Grab’s exposure to litigation claims and other loss contingencies; the risks associated with negative press or reputational harm; disruptions and other impacts to Grab’s business, as a result of the COVID-19 pandemic and government actions and restrictive measures implemented in response; Grab’s ability to protect patents, trademarks and other intellectual property rights; any breaches of, or interruptions in, Grab’s technology infrastructure; changes in tax laws and liabilities; and changes in legal, regulatory, political and economic risks and the impact of such changes on Grab’s business. 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 PubCo’s registration statement on Form F-4, the proxy statement/consent solicitation statement/prospectus discussed below, AGC’s Quarterly Report on Form 10-Q and other documents filed by PubCo or AGC from time to time with the U.S. Securities and Exchange Commission (the “SEC”). These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. In addition, there may be additional risks that neither AGC nor Grab presently know, or that AGC or Grab currently believe are immaterial, that could also cause actual results to differ from those contained in the forward-looking statements. Forward-looking statements reflect AGC’s and Grab’s expectations, plans, projections or forecasts of future events and view. If any of the risks materialize or AGC’s or Grab’s assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements.

Forward-looking statements speak only as of the date they are made. AGC and Grab anticipate that subsequent events and developments may cause their assessments to change. However, while PubCo, AGC and Grab may elect to update these forward-looking statements at some point in the future, PubCo, AGC and Grab specifically disclaim any obligation to do so, except as required by law. The inclusion of any statement in this document does not constitute an admission by Grab nor AGC or any other person that the events or circumstances described in such statement are material. These forward-looking statements should not be relied upon as representing AGC’s or Grab’s assessments as of any date subsequent to the date of this document. Accordingly, undue reliance should not be placed upon the forward-looking statements. In addition, the analyses of Grab and AGC contained herein are not, and do not purport to be, appraisals of the securities, assets or business of the Grab, AGC or any other entity.

Non-IFRS Financial Measures

This document may also include references to non-IFRS financial measures. Such non-IFRS measures should be considered only as supplemental to, and not as superior to, financial measures prepared in accordance with IFRS, and such non-IFRS measures may be different from non-IFRS financial measures used by other companies. 

Important Information About the Proposed Transactions and Where to Find It

This document relates to a proposed transaction between Grab and AGC. 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. The proposed transactions will be submitted to shareholders of AGC for their consideration. 

PubCo intends to file a registration statement on Form F-4 (the “Registration Statement”) with the SEC which will include preliminary and definitive proxy statements to be distributed to AGC’s shareholders in connection with AGC’s solicitation for proxies for the vote by AGC’s shareholders in connection with the proposed transactions and other matters as described in the Registration Statement, as well as the prospectus relating to the offer of the securities to be issued to Grab’s shareholders in connection with the completion of the proposed business combination. AGC and PubCo also will file other documents regarding the proposed transaction with the SEC. 

After the Registration Statement has been filed and declared effective, AGC will mail a definitive proxy statement and other relevant documents to its shareholders as of the record date established for voting on the proposed transactions. This communication is not a substitute for the Registration Statement, the definitive proxy statement/prospectus or any other document that AGC will send to its shareholders in connection with the business combination. AGC’s shareholders and other interested persons are advised to read, once available, the preliminary proxy statement/prospectus and any amendments thereto and, once available, the definitive proxy statement/prospectus, in connection with AGC’s solicitation of proxies for its special meeting of shareholders to be held to approve, among other things, the proposed transactions, because these documents will contain important information about AGC, PubCo, Grab and the proposed transactions. Shareholders and investors may also obtain a copy of the preliminary or definitive proxy statement, once available, as well as other documents filed with the SEC regarding the proposed transactions and other documents filed with the SEC by AGC, without charge, at the SEC’s website located at www.sec.gov or by directing a request to AGC. The information contained on, or that may be accessed through, the websites referenced in this document is not incorporated by reference into, and is not a part of, this document.

INVESTMENT IN ANY SECURITIES DESCRIBED HEREIN HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SEC OR ANY OTHER REGULATORY AUTHORITY NOR HAS ANY AUTHORITY PASSED UPON OR ENDORSED THE MERITS OF THE OFFERING OR THE ACCURACY OR ADEQUACY OF THE INFORMATION CONTAINED HEREIN. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

Participants in the Solicitation

AGC, PubCo and Grab and certain of their respective directors, executive officers and other members of management and employees may, under SEC rules, be deemed to be participants in the solicitations of proxies from AGC’s shareholders in connection with the proposed transactions. Information regarding the persons who may, under SEC rules, be deemed participants in the solicitation of AGC’s shareholders in connection with the proposed transactions will be set forth in PubCo’s proxy statement/prospectus when it is filed with the SEC. You can find more information about AGC’s directors and executive officers in AGC’s final prospectus filed with the SEC on September 30, 2020. Additional information regarding the participants in the proxy solicitation and a description of their direct and indirect interests will be included in the proxy statement/prospectus when it becomes available. Shareholders, potential investors and other interested persons should read the proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of these documents from the sources indicated above.

No Offer or Solicitation

This document is for informational purposes only and shall not constitute an offer to sell or the solicitation of an offer to buy any securities pursuant to the proposed transactions or otherwise, nor shall there be any sale of securities in any jurisdiction in which the offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended. 

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Komsan Chiyadis

GrabFood delivery-partner, Thailand

COVID-19 has dealt an unprecedented blow to the tourism industry, affecting the livelihoods of millions of workers. One of them was Komsan, an assistant chef in a luxury hotel based in the Srinakarin area.

As the number of tourists at the hotel plunged, he decided to sign up as a GrabFood delivery-partner to earn an alternative income. Soon after, the hotel ceased operations.

Komsan has viewed this change through an optimistic lens, calling it the perfect opportunity for him to embark on a fresh journey after his previous job. Aside from GrabFood deliveries, he now also picks up GrabExpress jobs. It can get tiring, having to shuttle between different locations, but Komsan finds it exciting. And mostly, he’s glad to get his income back on track.

BioMarin Holds Investor Day; Provides New Corporate Strategy and Introduces 2027 Financial Guidance

NEW YORK , Sept. 4, 2024 /PRNewswire/ -- BioMarin Pharmaceutical Inc. (NASDAQ: BMRN) hosted an Investor Day earlier today, where President and Chief Executive Officer Alexander Hardy and other members of BioMarin’s leadership team provided an overview of the company’s new corporate strategy to deliver sustained value creation and introduced longer-term Total Revenue and Non-GAAP Operating Margin guidance. A copy of the presentation and a replay of the webcast are available at investors.biomarin.com .

“Over the last 9 months, we have undertaken the transformation of BioMarin’s operations and ways of working with the goal of accelerating and delivering substantial value to all our stakeholders – patients, employees and shareholders,” said Mr. Hardy. “Our new corporate strategy harnesses BioMarin’s unique capabilities creating and leading new therapeutic markets around the world to deliver innovative medicines to the patients we serve. We are confident in our ability to realize the ambitious plans outlined today and excited to deliver on our new vision for BioMarin’s future.”

Corporate Strategy

The company reviewed BioMarin’s differentiated strategy including its new company structure and updated organizational model, now built around three business units, Enzyme Therapies, Skeletal Conditions and ROCTAVIAN ® , designed to support the focus on sustainable growth. The updated corporate strategy also includes the implementation of a $500 million cost transformation program that will contribute to Non-GAAP Operating margin targets set for 2026 and beyond.

Value Commitment

BioMarin provided an overview of its long-term financial outlook, based on its strategic plan to drive revenue growth and expand Non-GAAP Operating Margin. The summary table below includes the company’s full year 2024 guidance, reaffirmed today, and the newly introduced outlook for 2026 with respect to Non-GAAP Operating Margin and other metrics for 2027, shared at BioMarin’s Investor Day.

• Phase 3 enrollment of VOXZOGO ® for the treatment of hypochondroplasia, with expected data readout targeted in 2026, and potential approval in 2027
• Clinical updates on four additional skeletal conditions, including idiopathic short stature, Noonan Syndrome, Turner Syndrome and SHOX Deficiency, all progressing through or beginning Phase 2 studies
• PALYNZIQ ® age label expansion to include 12-17-year-olds in the United States and 12-15-year-olds outside of the United States , with targeted filings in late 2025 and early 2026, respectively
• BMN 390 for the treatment of phenylketonuria (PKU) with a targeted profile that reduces immunogenicity from novel pegylation, and targeted Investigational New Drug (IND) application planned for late 2025
• BMN 351 for the treatment of Duchenne Muscular Dystrophy that targets a unique novel site for exon skipping that may enable dystrophin expression up to 40%, based on observations preclinically. Target Proof of Concept (POC) is expected in 2025
• BMN 349 for the treatment of Alpha-1 Antitrypsin Deficiency with a unique mechanism of action that has the potential to transform liver health and with target POC in 2026
• BMN 370 for the treatment of von Willebrand Disease (vWD) has the potential to normalize bleeding events, based on results from a vWD preclinical model, and is designed to be delivered with a single subcutaneous injection. The targeted IND is planned for late 2025.

The company highlighted its strategy for optimizing its growing and durable Enzyme Therapies business unit, as well as its plan for sustainable leadership across multiple Skeletal Conditions, building on the strength of VOXZOGO for the treatment of achondroplasia. The combined business units are expected to drive a targeted mid-teen Compounded Annual Growth Rate through 2034.

A replay of today’s event and accompanying presentation slides can be found at investors.biomarin.com .

About BioMarin

Forward-Looking Statements

These forward-looking statements are predictions and involve risks and uncertainties such that actual results may differ materially from these statements. These risks and uncertainties include, among others, those factors detailed in BioMarin’s filings with the Securities and Exchange Commission, including, without limitation, the factors contained under the caption “Risk Factors” in BioMarin’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2024 , as such factors may be updated by any subsequent reports. You should carefully consider that information before you make an investment decision. You should not place undue reliance on forward-looking statements, which speak only as of the date hereof. These forward-looking statements are based on the beliefs and assumptions of the Company’s management based on information currently available to management and should be considered in connection with any written or oral forward-looking statements that the Company may issue in the future as well as other cautionary statements the Company has made and may make. Except as required by law, BioMarin does not undertake any obligation to update or alter any forward-looking statement, whether as a result of new information, future events or otherwise.

BioMarin ® , BRINEURA ® , KUVAN ® , NAGLAZYME ® , PALYNZIQ ® , ROCTAVIAN ® , VIMIZIM ® and VOXZOGO ® are registered trademarks of BioMarin Pharmaceutical Inc., or its affiliates. ALDURAZYME ® is a registered trademark of BioMarin/Genzyme LLC. All other brand names and service marks, trademarks and other trade names appearing in this release are the property of their respective owners.

Non-GAAP Information

This press release includes both GAAP information and Non-GAAP information. Non-GAAP Income is defined by the company as GAAP Net Income excluding amortization of intangible assets, stock-based compensation expense and, in certain periods, certain other specified items, as detailed below when applicable. The company also includes a Non-GAAP adjustment for the estimated tax impact of the reconciling items. Non-GAAP Operating Margin percentage is defined by the company as GAAP Income from Operations, excluding amortization of intangible assets, stock-based compensation expense, and, in certain periods, certain other specified items, divided by GAAP Total Revenues. Non-GAAP Diluted EPS is defined by the company as Non-GAAP Income divided by Non-GAAP weighted-average diluted shares outstanding. Non-GAAP weighted-average diluted shares outstanding is defined by the company as GAAP weighted-average diluted shares outstanding, adjusted to include any common shares issuable under the company’s equity plans and convertible debt in periods when they are dilutive under Non-GAAP.

BioMarin regularly uses both GAAP and Non-GAAP results and expectations internally to assess its financial operating performance and evaluate key business decisions related to its principal business activities: the discovery, development, manufacture, marketing and sale of innovative biologic therapies. Because Non-GAAP Income, Non-GAAP Operating Margin percentage, Non-GAAP Diluted EPS and Non-GAAP weighted-average diluted shares outstanding are important internal measurements for BioMarin, the company believes that providing this information in conjunction with BioMarin’s GAAP information for historical results enhances investors’ and analysts’ ability to meaningfully compare the company’s results from period to period and to its forward-looking guidance, and to identify operating trends in the company’s principal business. BioMarin also uses Non-GAAP Income internally to understand, manage and evaluate its business and to make operating decisions, and compensation of executives is based in part on this measure.

Non-GAAP measures are not meant to be considered in isolation or as a substitute for, or superior to, comparable GAAP measures and should be read in conjunction with the consolidated financial information prepared in accordance with GAAP. Investors should note that the Non-GAAP information is not prepared under any comprehensive set of accounting rules or principles and does not reflect all of the amounts associated with the company’s results of operations as determined in accordance with GAAP. Investors should also note that these Non-GAAP financial measures have no standardized meaning prescribed by GAAP and, therefore, have limits in their usefulness to investors. In addition, from time to time in the future there may be other items that the company may exclude for purposes of its Non-GAAP financial measures; likewise, the company may in the future cease to exclude items that it has historically excluded for purposes of its Non-GAAP financial measures. Because of the non-standardized definitions, the Non-GAAP financial measure as used by BioMarin in this press release may be calculated differently from, and therefore may not be directly comparable to, similarly titled measures used by other companies.

Forward-Looking Non-GAAP Financial Measures

BioMarin does not provide guidance for GAAP reported financial measures (other than revenue) or a reconciliation of forward-looking Non-GAAP financial measures to the most directly comparable GAAP reported financial measures because the company is unable to predict with reasonable certainty the financial impact of changes resulting from its strategic portfolio and business operating model reviews; potential future asset impairments; gains and losses on investments; and other unusual gains and losses without unreasonable effort. These items are uncertain, depend on various factors, and could have a material impact on GAAP reported results for the guidance period. As such, any reconciliations provided would imply a degree of precision that could be confusing or misleading to investors.

SOURCE BioMarin Pharmaceutical Inc.

The University of Chicago The Law School

Innovation clinic—significant achievements for 2023-24.

The Innovation Clinic continued its track record of success during the 2023-2024 school year, facing unprecedented demand for our pro bono services as our reputation for providing high caliber transactional and regulatory representation spread. The overwhelming number of assistance requests we received from the University of Chicago, City of Chicago, and even national startup and venture capital communities enabled our students to cherry-pick the most interesting, pedagogically valuable assignments offered to them. Our focus on serving startups, rather than all small- to medium-sized businesses, and our specialization in the needs and considerations that these companies have, which differ substantially from the needs of more traditional small businesses, has proven to be a strong differentiator for the program both in terms of business development and prospective and current student interest, as has our further focus on tackling idiosyncratic, complex regulatory challenges for first-of-their kind startups. We are also beginning to enjoy more long-term relationships with clients who repeatedly engage us for multiple projects over the course of a year or more as their legal needs develop.

This year’s twelve students completed over twenty projects and represented clients in a very broad range of industries: mental health and wellbeing, content creation, medical education, biotech and drug discovery, chemistry, food and beverage, art, personal finance, renewable energy, fintech, consumer products and services, artificial intelligence (“AI”), and others. The matters that the students handled gave them an unparalleled view into the emerging companies and venture capital space, at a level of complexity and agency that most junior lawyers will not experience until several years into their careers.

Representative Engagements

While the Innovation Clinic’s engagements are highly confidential and cannot be described in detail, a high-level description of a representative sample of projects undertaken by the Innovation Clinic this year includes:

Transactional/Commercial Work

• A previous client developing a symptom-tracking wellness app for chronic disease sufferers engaged the Innovation Clinic again, this time to restructure its cap table by moving one founder’s interest in the company to a foreign holding company and subjecting the holding company to appropriate protections in favor of the startup.
• Another client with whom the Innovation Clinic had already worked several times engaged us for several new projects, including (1) restructuring their cap table and issuing equity to an additional, new founder, (2) drafting several different forms of license agreements that the company could use when generating content for the platform, covering situations in which the company would license existing content from other providers, jointly develop new content together with contractors or specialists that would then be jointly owned by all creators, or commission contractors to make content solely owned by the company, (3) drafting simple agreements for future equity (“Safes”) for the company to use in its seed stage fundraising round, and (4) drafting terms of service and a privacy policy for the platform.
• Yet another repeat client, an internet platform that supports independent artists by creating short films featuring the artists to promote their work and facilitates sales of the artists’ art through its platform, retained us this year to draft a form of independent contractor agreement that could be used when the company hires artists to be featured in content that the company’s Fortune 500 brand partners commission from the company, and to create capsule art collections that could be sold by these Fortune 500 brand partners in conjunction with the content promotion.
• We worked with a platform using AI to accelerate the Investigational New Drug (IND) approval and application process to draft a form of license agreement for use with its customers and an NDA for prospective investors.
• A novel personal finance platform for young, high-earning individuals engaged the Innovation Clinic to form an entity for the platform, including helping the founders to negotiate a deal among them with respect to roles and equity, terms that the equity would be subject to, and other post-incorporation matters, as well as to draft terms of service and a privacy policy for the platform.
• Students also formed an entity for a biotech therapeutics company founded by University of Chicago faculty members and an AI-powered legal billing management platform founded by University of Chicago students.
• A founder the Innovation Clinic had represented in connection with one venture engaged us on behalf of his other venture team to draft an equity incentive plan for the company as well as other required implementing documentation. His venture with which we previously worked also engaged us this year to draft Safes to be used with over twenty investors in a seed financing round.

More information regarding other types of transactional projects that we typically take on can be found here .

Regulatory Research and Advice

• A team of Innovation Clinic students invested a substantial portion of our regulatory time this year performing highly detailed and complicated research into public utilities laws of several states to advise a groundbreaking renewable energy technology company as to how its product might be regulated in these states and its clearest path to market. This project involved a review of not only the relevant state statutes but also an analysis of the interplay between state and federal statutes as it relates to public utilities law, the administrative codes of the relevant state executive branch agencies, and binding and non-binding administrative orders, decisions and guidance from such agencies in other contexts that could shed light on how such states would regulate this never-before-seen product that their laws clearly never contemplated could exist. The highly varied approach to utilities regulation in all states examined led to a nuanced set of analysis and recommendations for the client.
• In another significant research project, a separate team of Innovation Clinic students undertook a comprehensive review of all settlement orders and court decisions related to actions brought by the Consumer Financial Protection Bureau for violations of the prohibition on unfair, deceptive, or abusive acts and practices under the Consumer Financial Protection Act, as well as selected relevant settlement orders, court decisions, and other formal and informal guidance documents related to actions brought by the Federal Trade Commission for violations of the prohibition on unfair or deceptive acts or practices under Section 5 of the Federal Trade Commission Act, to assemble a playbook for a fintech company regarding compliance. This playbook, which distilled very complicated, voluminous legal decisions and concepts into a series of bullet points with clear, easy-to-follow rules and best practices, designed to be distributed to non-lawyers in many different facets of this business, covered all aspects of operations that could subject a company like this one to liability under the laws examined, including with respect to asset purchase transactions, marketing and consumer onboarding, usage of certain terms of art in advertising, disclosure requirements, fee structures, communications with customers, legal documentation requirements, customer service and support, debt collection practices, arrangements with third parties who act on the company’s behalf, and more.

Miscellaneous

• Last year’s students built upon the Innovation Clinic’s progress in shaping the rules promulgated by the Financial Crimes Enforcement Network (“FinCEN”) pursuant to the Corporate Transparency Act to create a client alert summarizing the final rule, its impact on startups, and what startups need to know in order to comply. When FinCEN issued additional guidance with respect to that final rule and changed portions of the final rule including timelines for compliance, this year’s students updated the alert, then distributed it to current and former clients to notify them of the need to comply. The final bulletin is available here .
• In furtherance of that work, additional Innovation Clinic students this year analyzed the impact of the final rule not just on the Innovation Clinic’s clients but also its impact on the Innovation Clinic, and how the Innovation Clinic should change its practices to ensure compliance and minimize risk to the Innovation Clinic. This also involved putting together a comprehensive filing guide for companies that are ready to file their certificates of incorporation to show them procedurally how to do so and explain the choices they must make during the filing process, so that the Innovation Clinic would not be involved in directing or controlling the filings and thus would not be considered a “company applicant” on any client’s Corporate Transparency Act filings with FinCEN.
• The Innovation Clinic also began producing thought leadership pieces regarding AI, leveraging our distinct and uniquely University of Chicago expertise in structuring early-stage companies and analyzing complex regulatory issues with a law and economics lens to add our voice to those speaking on this important topic. One student wrote about whether non-profits are really the most desirable form of entity for mitigating risks associated with AI development, and another team of students prepared an analysis of the EU’s AI Act, comparing it to the Executive Order on AI from President Biden, and recommended a path forward for an AI regulatory environment in the United States. Both pieces can be found here , with more to come!

Innovation Trek

Thanks to another generous gift from Douglas Clark, ’89, and managing partner of Wilson, Sonsini, Goodrich & Rosati, we were able to operationalize the second Innovation Trek over Spring Break 2024. The Innovation Trek provides University of Chicago Law School students with a rare opportunity to explore the innovation and venture capital ecosystem in its epicenter, Silicon Valley. The program enables participating students to learn from business and legal experts in a variety of different industries and roles within the ecosystem to see how the law and economics principles that students learn about in the classroom play out in the real world, and facilitates meaningful connections between alumni, students, and other speakers who are leaders in their fields. This year, we took twenty-three students (as opposed to twelve during the first Trek) and expanded the offering to include not just Innovation Clinic students but also interested students from our JD/MBA Program and Doctoroff Business Leadership Program. We also enjoyed four jam-packed days in Silicon Valley, expanding the trip from the two and a half days that we spent in the Bay Area during our 2022 Trek.

The substantive sessions of the Trek were varied and impactful, and enabled in no small part thanks to substantial contributions from numerous alumni of the Law School. Students were fortunate to visit Coinbase’s Mountain View headquarters to learn from legal leaders at the company on all things Coinbase, crypto, and in-house, Plug & Play Tech Center’s Sunnyvale location to learn more about its investment thesis and accelerator programming, and Google’s Moonshot Factory, X, where we heard from lawyers at a number of different Alphabet companies about their lives as in-house counsel and the varied roles that in-house lawyers can have. We were also hosted by Wilson, Sonsini, Goodrich & Rosati and Fenwick & West LLP where we held sessions featuring lawyers from those firms, alumni from within and outside of those firms, and non-lawyer industry experts on topics such as artificial intelligence, climate tech and renewables, intellectual property, biotech, investing in Silicon Valley, and growth stage companies, and general advice on career trajectories and strategies. We further held a young alumni roundtable, where our students got to speak with alumni who graduated in the past five years for intimate, candid discussions about life as junior associates. In total, our students heard from more than forty speakers, including over twenty University of Chicago alumni from various divisions.

The Trek didn’t stop with education, though. Throughout the week students also had the opportunity to network with speakers to learn more from them outside the confines of panel presentations and to grow their networks. We had a networking dinner with Kirkland & Ellis, a closing dinner with all Trek participants, and for the first time hosted an event for admitted students, Trek participants, and alumni to come together to share experiences and recruit the next generation of Law School students. Several speakers and students stayed in touch following the Trek, and this resulted not just in meaningful relationships but also in employment for some students who attended.

More information on the purposes of the Trek is available here , the full itinerary is available here , and one student participant’s story describing her reflections on and descriptions of her experience on the Trek is available here .

The Innovation Clinic is grateful to all of its clients for continuing to provide its students with challenging, high-quality legal work, and to the many alumni who engage with us for providing an irreplaceable client pipeline and for sharing their time and energy with our students. Our clients are breaking the mold and bringing innovations to market that will improve the lives of people around the world in numerous ways. We are glad to aid in their success in any way that we can. We look forward to another productive year in 2024-2025!