Jason Kelly: Sure, I can take that one. Yes. So I think one of the things that’s very interesting about Ginkgo is we have a lot of ongoing programs today. And so I think the first place we’ll see the application of AI is in driving efficiency of all of that ongoing work. So you saw some examples of that in the slides I showed. But a big part of what we’re trying to do next year is add lots of new programs while keeping a lid on our operational expenses. You will see that, in part, driven by the efficiencies we’re going to gain in AI. And then secondly, I think in the longer term, AI represents an interesting interface to our platform. So I think we’ll ultimately be able to open it up more directly to customers through AI tools. And so that’s something we’re excited about and part of the model building we’re doing with Google.
Megan LeDuc: Great. Thanks, Jason. We’ll start opening it up to analysts now. Tejas from Morgan Stanley.
Tejas Savant: Good evening. Can you hear me okay? Perfect. So Jason, one quick question for you. Just in terms of the later program adds here and the implied sort of cell engineering guide for the fourth quarter, how should we be thinking about 2024? Consensus has you doing about $300 million in cell engineering revenue, but you guys are sort of in that $40 million to $50 million quarterly run rate at the moment. So are there any sort of like missing pieces there that we should be thinking about as we think about the year-over-year progression?
Jason Kelly: Yes. So we, obviously, are not sharing guidance yet on 2024. I’d say mainly the — we have an aggressive push around expanding the scale of our enterprise sales efforts and our ability to add new programs to the platform. I’m really happy to see like if you look at the number of active programs going up on the platform, there’s our ability to handle more work has gone up a lot. And so I think that’s part of what gets us excited for next year. But we will be sharing, obviously, guidance at the next call.
Tejas Savant: Fair enough. And then one on just the tech licensing evaluation deals that you mentioned. Obviously, early days still, and you’re not including them in the program count, but can you just give us some context around how meaningful a contribution this could be? And over what time frame do you expect sort of some early wins based upon your conversation so far?
Jason Kelly: Yes. Mark, do you want to talk a little bit about how we think about those tech licensing?
Mark Dmytruk: Yes. So I would think sort of single-digit millions in terms of potential licenses or kind of lower double-digit millions and potentially some wins, certainly, within the next 12 months.
Tejas Savant: Got it. Fair enough. I appreciate it.
Jason Kelly: And maybe the only thing I would add to that, I think it will be an interesting thing for us to think about in the long term. Obviously, we have certain definitions for what makes for a major program at Ginkgo that gets added to our program count. I kind of hope over time, we have more assets in our code base that can more easily be directly licensed into customers. That’s obviously great. It’s revenue back to us without a bunch of work. So I think those are nice things to see. But as we get more of them, I think we’ll want to figure out how to communicate that to you all better.
Megan LeDuc: Next up, we have Steve Mah from Cowen.
Poon Mah: Great. Can you hear me? Great. With regards to the new program adds, can you give us a sense if there’s any particular partner class, which is harder to get over the deal signing goal line? And what specifically are you guys going to be doing to improve the deal closing time line? If I heard correctly, it looks like you said your enterprise sales team is rightsized. So if it’s rightsized, what exactly are you doing to kind of improve the deal closing timing?
Jason Kelly: Yes. So I’ll speak to it generally. Mark, if you want to add anything, go for it. I know the timing is something you think a lot about. So first thing I would say is I don’t know that we’re like — I don’t think we’re rightsized on the total size of the enterprise sales team. I think what is exciting to me is if you look at the new programs, 10 out of 21, were in biopharma this quarter. And so — and Steve, we talked about this previously, but like if you look across different industries for biotechnology, the largest R&D budget spend is in biopharma. So in terms of our ability to expand into a market is the one I’m the most excited about. Now we started in industrial biotech even before we got into ag, and that’s in part because that industry had less in-house infrastructure, right?
At the end of the day, Ginkgo is convincing a customer to outsource to our platform, something they might otherwise do in-house. And that was an easier argument to a start-up industrial biotech company versus Pfizer, okay, say, 5 years ago. Now what’s happened in the interim is the venture capital ecosystem around industrial biotech has gotten really tight so that has been headwinds for us in terms of adding new programs there. But we’ve built out more of our enterprise sales team, like I mentioned on closing that Pfizer deal in biopharma. Expect us to make that team bigger. We see a lot more opportunity there. I think we’re fundamentally limited by the number of people we have out talking to customers right now. And so I think that’s one of the ways we’re going to grow program counts next year is growing that sales team.
