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Kevin Quon  

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  • Details Emerge For Solazyme's Potential Co-Products [View article]
    There's a production cost, a temporary cost, and a fixed cost. We knew that.

    Can you repeat the scary part again? Because a fixed cost of $3.6 million doesn't seem dangerous, and technically should be separated from the cost of production when you're evaluating the performance of the process. Especially at Moema.
    Jul 3, 2015. 12:58 PM | 3 Likes Like |Link to Comment
  • Details Emerge For Solazyme's Potential Co-Products [View article]
    Hi Dave,

    Algawise is being marketed by Bunge North America.

    It's still very early in terms of introducing the brand commercially. However these oils are also geared for large purchase orders (for businesses and what not). I'm sure they'll have a product for consumers in due time but we're not there yet - so I don't know if you can obtain any. Oil sales should increase over the back half of this year.

    Jul 2, 2015. 06:31 PM | 5 Likes Like |Link to Comment
  • Details Emerge For Solazyme's Potential Co-Products [View article]

    Proterro's been staying relatively silent as is to be expected from most small private companies. There has never been a direct or publicly stated relationship with Solazyme either, although there are many reasons to believe that the company will be working with Solazyme in the future as my last article on the subject tried to point out. From what I'm aware of, Solazyme has at least done trial work with almost a dozen next gen sugar companies in the past. I'm also under the belief that Proterro in particular was advised to look towards 1st gen biofuel producers in the near term rather than pursuing companies like Solazyme. Don't read into that, it's just sound business advice.

    I would not be looking at Proterro like it's going to change anything over the next 2-3 years. I think within half a decade we'll begin to see increased work with these next gen sugar companies. They're very much an intermediate-term goal. While Proterro for instance is modular and capable of quickly scaling up, recall that things are still very early for this co as well.

    Jul 1, 2015. 10:52 PM | 3 Likes Like |Link to Comment
  • Details Emerge For Solazyme's Potential Co-Products [View article]

    There's a difference between a reality check and falsified claims.

    It takes 1 minute for Maxx to say this:

    "Riddle me this. If Solazyme realized production costs of ~$6,100 per MT in 3Q14 for its Intermediates & Ingredients portfolio, then how will it become profitable any time soon with limited and non-optimized production capacity?"

    It takes me more than an hour to reply to him showing that he just made up his own facts and held me accoutable to them:

    And then it took you another minute to say the following:
    "Really Kevin, All that could have been summed up by saying "Come on Max, it might not be all that bad. You might not be 100% right, you might be only 60% right. And it might turn around in the future.""

    So that's what I'm doing. I'm following your advice. I will not reply to his false claims and I'm dismissing them without addressing them. People can believe what they want. I'm not going to waste my time on them anymore and if you want a contrary opinion to them, ask someone else. That's all I'm saying in my disclaimer.

    If you now want a researched and strong contrary opinion to his claims, I'm sorry. I think you just already convinced me the first time to wipe my hands clean of him. So let me just walk away rather than suggesting I'm doing something wrong. In the future, a shorter disclaimer will remain and what you guys make of what he says is up to you. I'm joining your side as a spectator that gets to make 1 minute comments instead.

    Jun 27, 2015. 01:25 PM | 5 Likes Like |Link to Comment
  • Details Emerge For Solazyme's Potential Co-Products [View article]
    1) It's in most of the filings. Here's a quick snipped from the 2014 10-k: "Through the end of 2013, cost of product revenue consisted primarily of third-party contractor costs associated with packaging,
    distribution and production of Algenist® products, including internal labor, shipping, supplies and other overhead costs associated with
    production of Alguronic Acid®, a microalgae-based active ingredient, and Microalgae Oil used in our Algenist® product line."

    3) No i don't. Alguronic Acid is a bit of a special instance because so little of it is needed to be made and the majority of the expenditures are in the other materials/packaging required to make the final product. For particular high valued ingredients is probably possible to do the same model (recall that alguronic acid can fetch >$1 mil per MT).
    Jun 27, 2015. 12:53 PM | 4 Likes Like |Link to Comment
  • Details Emerge For Solazyme's Potential Co-Products [View article]
    V123, primary market offset.
    Jun 26, 2015. 09:41 PM | 1 Like Like |Link to Comment
  • Details Emerge For Solazyme's Potential Co-Products [View article]
    Appreciate it, Mike. But I feel obliged to let people be aware that I am not stonewalling him for merely having a dissenting opinion. People can both appreciate and hate his quality of writing elsewhere. I just want to make sure they understand it's the person I'm ignoring because of the way he is here. For those that like his writing, I have no problem giving him further credibility by redirecting them to his articles.
    Jun 26, 2015. 05:16 PM | 6 Likes Like |Link to Comment
  • Details Emerge For Solazyme's Potential Co-Products [View article]
    =========== DISCLAIMER =============

    As I have comprehensively addressed this contributing writer from The Motley Fool on multiple occasions, I would kindly ask any reader who happens to see this disclaimer to take any questions they have for Maxx to a private conversation. For example, the message inbox system on Seeking Alpha works quite well. And while I continue to note that Maxx has not privately messaged me as he publicly pretended he would, I'm sure he would not mind hearing from you there. Alternatively, I would encourage readers to take their questions for Maxx to his own articles so that he does not have to try to find who you are and fetch you here.

    However, if your conversation with him must remain in this public setting, please do not expect any more input from myself or to ask me any follow up questions that result with your conversation with him. I refuse to spend any more time on addressing any misplaced concerns that arise out of the claims he makes.

    There is nothing wrong with having different perspectives, but there is nothing to be gained over trivial arguments and disruptive conversation which quite often result when Maxx writes here. I personally find fault in Maxx's approach to gain acceptance and often find his beliefs (which he often states to be facts) to be both speculative at best and disruptive in many cases to the general conversation.



    Once again, as we have repeatedly discussed, your public commentary here is not welcomed by me. As you continue to post, you do so knowing fully well that your presence offends this contributor and that your repeated slights against me are done so in full disregard to the supposed professionalism you pretend to merit. It is even more degrading that you make every effort to attack me personally given the chance whether directly or in subtle references. Your spammed association with the Motley Fool and links to your articles made on my articles are also done in poor taste.

    As you continue to defy this simple request to take your conversation elsewhere, may this ongoing intrusion be nothing more than a continued reflection of your character.

    Jun 26, 2015. 04:56 PM | 11 Likes Like |Link to Comment
  • Details Emerge For Solazyme's Potential Co-Products [View article]
    Thank you, 15971612. I agree with you. If one really wanted a narrow product range, here's essentially what the company is making (outside of its commitments to long-term partners):

    1) A natural strain of algae creating an encapsulated product. Little downstream processing which varies depending on end product. Alternating process settings on the fermentation creates the product variety (ex. the difference between WAF & WAP can be when or when not to turn off the nitrogen).

    2) A modified algae strain which makes the various forms of oleic oils.


    3) A very, very small batch of algae used to make alguronic acid at Peoria to support Algenist. The rest is handled via 3rd party manufacturers.


    There seems to be a real missed understanding about the length of time needed to develop markets. It's not necessarily that the demand is not there, but rather product formulation, regulatory approvals, market awareness, etc. all requires time. Change doesn't happen overnight, and when the company wants to develop 10+ products all at once, it's not for a lack of focus that it hasn't generated the desired revenue one wants to see. Especially not when all of these products rotate around a core technology platform using the same infrastructure. And also not when it's the partners with large established sales networks that are pushing the marketing forward.

    It took 2 years just to have Natura Cosmeticos agree to put our oils into their products. That's just the normal course of business after product formulations and trials. So if people think changing product development midstream now is going to suddenly unlock revenue, I don't think so. It takes time and that's just the reality of disruptive technology.
    Jun 26, 2015. 04:22 PM | 9 Likes Like |Link to Comment
  • Details Emerge For Solazyme's Potential Co-Products [View article]

    I feel obligated to acknowledge the possibility, although that would be both misleading and presumptuous on the part of management in the context of what they're asserting in the S-1 Filing. Considering selling prices weren't factored into the cost of production, it simply wouldn't make sense to believe that co-products have already been factored in at the time of that statement.

    "The production cost profile we have already achieved provides attractive margins when utilizing partner and contract manufacturing for the nutrition, and skin and personal care markets. Based on the technology milestones we have demonstrated, we believe that we can profitably enter the fuels and chemicals markets when we commence production in larger-scale, built-for-purpose commercial manufacturing facilities utilizing sugarcane feedstock. For example, our lead microalgae strains producing oil for the fuels and chemicals markets have achieved key performance metrics that we believe would allow us to manufacture oils today at a cost below $1,000 per metric ton ($3.44 per gallon or $0.91 per liter) if produced in a built-for-purpose commercial plant."

    I agree with you that there shouldn't be much difficulty in finding a market. I also have reason to believe fishmeal is being worked on, but nothing that I can cite. The general trend of fishmeal prices has been quite promising all things considered:

    Jun 26, 2015. 04:05 PM | Likes Like |Link to Comment
  • Details Emerge For Solazyme's Potential Co-Products [View article]
    Alltech is indeed in this business already, and has been for some time. There are very few other heterotrophic algae players out there, but they are one of them. The animal feed market is quite large which is exactly what we're looking for.

    It's worth noting that their algae is green, suggesting chlorophyll. I wonder if this leads to distinctly different taste characteristics.
    Jun 26, 2015. 02:12 PM | 4 Likes Like |Link to Comment
  • Solazyme's AlgaVia Gains Traction As Bird Flu Leads To Possible Egg Shortage [View article]
    Wait a minute, RWRATTI. I don't think you realize that loud isn't always better. Maybe you werent' around years ago, but the company publicly noted that it intended to work without immediate public updates on its business operations. It also stated on multiple occasions that it has to respect the privacy of its partners, and it even got into trouble in some instances. In many cases, its even working with competitor clients which requires being hush altogether.

    I can assure you that the egg crisis has been the rising water for all the boats, and while Hampton Creek has the luxury of being in the media spotlight, it doesn't mean that Solazyme isn't gaining off of the situation at hand. Hampton Creek isn't operating on the same level as SZYM, so it has much more freedom to say what it wants. Public vs. Private is a huge difference too.
    Jun 26, 2015. 01:25 PM | 3 Likes Like |Link to Comment
  • Details Emerge For Solazyme's Potential Co-Products [View article]
    Hi walterrn,

    The lawsuits are being made in the absence of a lead plaintiff and the press releases are intended to seek out angry shareholders in order to have a case. It's just another scheme for one law firm to steal shareholder money by attracting upset investors. The events cited are months old. Sadly, this happens quite often. The multiple cases arising are due to piggy-back law firms that chase ambulances. Typically, little to no impact is usually felt by the company itself in the end.

    Jun 26, 2015. 01:18 PM | 10 Likes Like |Link to Comment
  • Details Emerge For Solazyme's Potential Co-Products [View article]
    Hi Sergio,

    I agree with the cash burn concern. However, I'm not so sure a takeover would be the best option, and personally as an investor it would also take away my ability to directly invest in the technology. As for the board of directors, selling out at this low point given the wide range of potential would also be quite disappointing. I would very much prefer dilution over a takeover should it come to choosing between the two. But unlike many, I'm also skeptical if the outlook is that grim to necessarily consider either.

    The only real concern at this point is just time (cash) as the steel is already in the ground and the products are gaining traction. The company already has a profitable product line and could theoretically thrive on just that if it absolutely needed to... but that would come at a significant cost and lengthy restart period. Alternatively, it could sell off Algenist (perhaps a upfront lump sum + a small ongoing royalty) and likely have enough capital to thrive going forward.

    I probably have more confidence than most that the cash burn will slow over the coming year and all this concern is quite moot. However, it amazes me that people look at this and fail to see opportunity.

    Even if you were bearish or unsure on Solazyme in the near term, investors should be looking at the premiums behind the call options. Finding protection in covered calls has been quite lucrative over the past few months since the november fall (and over for the last few years really) and I would encourage those who are more risk-adverse to this speculative long-term play to consider diversifying into such protection in order to generate income while they wait.

    Above all, this is a company to invest in for 10 years at a time. Disruptive technology like this doesn't come often and it will stumble from time to time and cost a pretty penny initially. But when viewed like a drug pipeline, Solazyme's product pipeline is quite unique and impressive. It deserves to be viewed on a forward-looking valuation basis. Unfortunately, industrial biotechnology as a whole has been viewed differently on the market than medical biotech.

    At least in Solazyme's case, it's creating new products with increased functionality rather than merely replacing existing commodities. This is something that is different than the Amyris' / Gevo's / Genomatica's / etc. that are out there. This is an oversight by the investment community in my opinion and should merit additional valuation. Just my two cents on the issue.

    Jun 26, 2015. 12:54 PM | 15 Likes Like |Link to Comment
  • Solazyme Begins To Sell Algae Oils To Natura Cosmeticos [View article]
    As long as there is time (and lately there has been on the CC's), anyone can ask a question. Typically, no one bothers to do so and the CC's are often held during working hours. I'm sure the analysts do get first dibs, however.
    Jun 26, 2015. 12:35 PM | Likes Like |Link to Comment