INNOVATION IS KEY TO GROWTH www.ark-invest.com

For Informational Purposes Only. Not for Distribution. INVESTMENT OPPORTUNITY ARK aims to identify large-scale investment opportunities by focusing on public companies that are the leaders, enablers, and beneficiaries of disruptive innovation.

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TODAY, WE IDENTIFY MORE INNOVATION PLATFORMS THAN EVER BEFORE

• ARK seeks to capitalize on powerful opportunities for growth associated with secular shifts and long-term trends.

• While benchmarks reflect past successes, ARK’s investment approach focuses on innovation to capture future growth.

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DISRUPTIVE INNOVATION CREATES OPPORTUNITIES AND VALUE TRAPS

• The average lifespan of S&P 500 companies reflects the accelerating pace of change.

• The average lifespan of an S&P 500 company has dropped from 33 years in 1965, to 20 years in 1990, and is forecast to shrink to 14 years by 2026. At the current and forecast turnover rate, roughly 50% of the current S&P 500 will be replaced within the next ten years.1

AVERAGE COMPANY LIFESPAN ON S&P 500 INDEX IN YEARS (rolling 7-year average) 40

30

20

10

0 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030

[1] Anthony, Scott D., S. Patrick Viguerie, and Andrew Waldeck. "Corporate Longevity: Turbulence Ahead for Large Organizations." Innosight, 2016, ark-invest.com | 4 https://www.innosight.com/wp-content/uploads/2016/08/Corporate-Longevity-2016-Final.pdf INVESTMENT OPPORTUNITY

ARK IDENTIFIES FIVE INNOVATION PLATFORMS EVOLVING TODAY

DNA Artificial Energy Storage Sequencing Intelligence Technology

These Innovation Platforms Enable Long-Term Investment Opportunities

Industrial Innovation Genomics Innovation Internet Innovation

Elements Elements Elements Autonomous Vehicles Gene Therapy/ Stem Cells Cloud Computing

3D Printing DNA Big Data

Robotics Cancer Treatments

Battery Technology Diagnostics Mobile/ IoT

Space Exploration Bioinformatics Digital Media

Mobility-as-a-Service Therapeutics Bitcoin/ Cryptocurrencies

Innovative Materials Agricultural Biology Fintech … … …

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LONG-TERM INVESTMENT OPPORTUNITIES IN DISRUPTIVE INNOVATION

Human genomic sequencing is projected to grow at a 200% + annual growth rate over the next five years. Plants, animals, tumors, viruses, and bacteria also will be sequenced.1

CRISPR’s addressable market in the monogenic disease space totals more than $75 billion annually with nearly $2 trillion in latent demand from unaddressed populations.7

Autonomous Mobility-as-a-Service should reach $10 trillion in gross sales by the early 2030s.2

Globally, deep learning should approach a $17 trillion market cap in 20 years.3

Global sales of electric vehicles (EVs) should reach 17 million units by 2022.4

Mobile value transfers are expected to reach $55 trillion globally by 2022.5

The 3D printing market should grow from $6 billion in 2016 to $65 billion by 2022, with some estimates reaching $490 billion by 2025.6

Forecasts are inherently limited and cannot be relied upon. Please note, companies that ARK believes are capitalizing on disruptive innovation and developing technologies to displace older technologies or create new markets may not in fact do so and/or may face political or legal attacks from competitors, industry groups, or local and national governments. ARK aims to educate investors and to size the potential opportunity of disruptive innovation, noting that risks and uncertainties may impact our projections and research models. Investors should use the content presented for informational purposes only, and be aware of market risk, disruptive innovation risk, regulatory risk, and risks related to the innovation area:

[1] [2] [3] [4] [5] Source: ARK LLC, 2018 [6] Source: ARK Investment Management LLC, McKinsey [7] Source: ARK Investment Management LLC, 2017; Genetic Explanation: Sense and Nonsense. Gruber, Jeremy & Krimsky, Sheldon. 2013 ark-invest.com | 6 WHY DISRUPTIVE INNOVATION?

ARK focuses solely on disruptive 1. “The Market’s Short-Term Time Horizon” innovation to take advantage of four market inefficiencies 2. “The Passive Public Markets”

3. “The Silo-ization of Wall Street”

4. “The Closed-off Research and Investment Mentality”

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1. “The Market’s Short-Term Time Horizon”

The market easily can be distracted by short-term price movements, losing focus on the long-term effect of disruptive technologies. We believe there is a time arbitrage ARK can take advantage of. We seek opportunities that offer growth over 3-5 years that the market ignores or underestimates.

Saddle Adoption Curve of Innovation

Source: ARK Investment Management LLC ark-invest.com | 8 WHY DISRUPTIVE INNOVATION?

2. “The Passive Public Markets”

Innovation investors have crowded into the private markets, while at the same time the public markets have increasingly gone passive. Thus ARK believes innovative public companies with forward looking growth are the most inefficiently priced part of the market.

Diminishing Opportunities Aiming to Capture Growth Missing the “Next Big Thing” in the Pre- IPO Space in the Public Markets in Benchmarks

ARK believes traditional asset ARK identifies inefficiencies in ARK observes that investors managers have crowded into innovative stocks in the public have moved towards passive the private space, limiting markets, investing in companies benchmarks, rewarding past opportunities. best positioned for growth. successes, as indices tend to be market-cap weighted.

PRIVATE PUBLIC BENCHMARK

IPO–Filter

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3. “The Silo-ization of Wall Street”

Innovation cannot be boxed into sectors, geographies, or market caps. Index strategies tend to miss forward looking growth opportunities, while analysts covering disruptive companies have trouble understanding technology cost curves. ARK’s analysts are organized by cross-sector disruptive innovation themes to capitalize on the convergence of research.

INNOVATION PLATFORMS vs STYLE BOXES Example: ARK Disruptive Innovation Strategy — actively managed concentrated portfolio PORTFOLIO COMPOSITION SECTORS Gene Therapy 11.5% 3D Printing 9.2% Health Care 37.6% Autonomous Vehicles 8.7% Information Technology 23.9% Instrumentation 7.8% Communication Services 17.0% Big Data & Machine Learning 7.4% Consumer Discretionary 17.0% Molecular Diagnostics 6.9% Financials 3.5% E-Commerce 6.7% Industrials 0.7% Robotics 5.1% VS. Internet of Things 4.7% Funds 0.4% Digital Media 4.4% MARKET CAPITALIZATION Bioinformatics 4.2% Social Platforms 4.1% Mega (100 B+) 13.0% Beyond DNA 3.3% Large (10-100 B) 35.1% Cloud Computing 3.2% Energy Storage 3.0% Medium (2-10 B) 11.0% Targeted Therapeutics 2.8% Small (300M-2B) 38.1% Blockchain & P2P 2.5% Micro (50-300M) 2.6% Mobile 2.2%

Source: ARK Investment Management LLC; All data as of September 30, 2018 ark-invest.com | 10 WHY DISRUPTIVE INNOVATION?

4. “The Closed-off Research and Investment Mentality”

Disruptive innovation demands an open-source approach to gain a deeper understanding of the convergence and full market potential. ARK uses an Open Research Ecosystem that combines top-down and bottom-up research. It is designed to identify disruptive innovation early, allowing for an organized exchange of insights between the portfolio manager, director of research, analysts, and external sources.

OPEN RESEARCH ECOSYSTEM

Data Sources A Analyst Teams TRADITIONAL ONLINE + SOURCES SOCIAL MEDIA Portfolio Management ARK Theme Developers LAB PM TD

CROWDSOURCING

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HOW TO USE DISRUPTIVE INNOVATION STRATEGIES

1. Portfolio diversification — thematic investing in disruptive innovation can offer a low correlation of relative returns to traditional growth strategies and negative correlation to value strategies.

2. Source of alpha — a top-down approach looks at secular trends and ecosystems to find attractive growth opportunities across sectors.

3. Hedge for index-based strategies — a constant focus on secular changes and disruptive innovation can offer a portfolio hedge in a rapidly changing world and complement traditional strategies.

GROWTH STRATEGY SATELLITE STRATEGY HEDGE

Equity Core Portfolio Portfolio Growth Portfolio

The information herein is general in nature and should not be considered financial advice. An investor should consult a financial professional regarding the investor’s specific situation. ark-invest.com | 12 CONTACT

Catherine D. Wood Tom Staudt Kellen Carter, ARK Invest Founder CEO/CIO Chief Operating Officer Chief Compliance Officer/ 155 W. 19th Street, 5th Floor [email protected] [email protected] Corporate Counsel New York, NY 10011 [email protected] (212) 426-7040 www.ark-invest.com

©2018, ARK Investment Management LLC. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of ARK Investment Management LLC (“ARK”).

The information provided is for informational purposes only and is subject to change without notice. This presentation does not constitute, either explicitly or implicitly, any provision of services or products by ARK, and investors should determine for themselves whether a particular investment management service is suitable for their investment needs. All statements made regarding companies or securities are strictly beliefs and points of view held by ARK, and are not endorsements by ARK of any company or security or recommendations by ARK to buy, sell or hold any security. Historical results are not indications of future results.

Certain of the statements contained in this presentation may be statements of future expectations and other forward-looking statements that are based on ARK's current views and assumptions, and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. The matters discussed in this presentation may also involve risks and uncertainties described from time to time in ARK's filings with the U.S. Securities and Exchange Commission. ARK assumes no obligation to update any forward-looking information contained in this presentation. ARK and its clients as well as its related persons may (but do not necessarily) have financial interests in securities or issuers that are discussed. Certain information was obtained from sources that ARK believes to be reliable; however, ARK does not guarantee the accuracy or completeness of any information obtained from any third party. ARK and its clients as well as its related persons may (but do not necessarily) have financial interests in securities or issuers that are discussed.

Index Descriptions: The S&P 500® Index is a widely recognized capitalization-weighted index that measures the performance of the large-capitalization sector of the U.S. stock market.

ARK's statements are not an endorsement of any company or a recommendation to buy, sell or hold any security. For a list of all purchases and sales made by ARK for client accounts during the past year that could be considered by the SEC as recommendations go to http://ark-invest.com/wp-content/trades/ARK_Trades.pdf. It should not be assumed that recommendations made in the future will be profitable or will equal the performance of the securities in this list. For full disclosures http://ark-invest.com/terms-of-use. ark-invest.com | 13