As filed with the Securities and Exchange Commission on September 29, 2025.

Registration Statement No. 333-

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

_____________________________________

FORM F-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

_____________________________________

SHAREWOW LIMITED
(Exact name of Registrant as specified in its charter)

_____________________________________

Not Applicable
(Translation of Registrant’s name into English)

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Suite 310, Building B, Huijin Huli Building
No. 966 Anling Road, Huli District
Xiamen City, Fujian Province, 361017, China
Tel: +86 13599918396

(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)

_____________________________________

Puglisi & Associates
850 Library Ave., Suite 204
Newark, DE 19711
(302) 738-6680

(Name, address, including zip code, and telephone number, including area code, of agent for service)

_____________________________________

Approximate date of commencement of proposed sale to the public: as soon as practicable after the effective date of this registration statement.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☐

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.

Emerging growth company ☒

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐

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†        The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to such Section 8(a), may determine.

PRELIMINARY PROSPECTUS (Subject to Completion)
Dated September 29, 2025

Sharewow Limited

3,750,000 Ordinary Shares

This is an initial public offering of 3,750,000 ordinary shares, par value US$0.0001 per share, by Sharewow Limited. We currently anticipate the initial public offering price of our ordinary shares to be between US$           and US$           per ordinary share.

Prior to this offering, there has been no public market for our ordinary shares. We have applied for the listing of our ordinary shares on the Nasdaq Capital Market (the “Nasdaq”) under the symbol “SUWA.” This offering is contingent upon the listing of our ordinary shares on the Nasdaq. There is no assurance that such application will be approved, and if our application is not approved by Nasdaq, this offering may not be completed.

Upon the completion of this offering, our issued and outstanding share capital will consist of 23,750,000 ordinary shares, assuming the underwriter does not exercise their option to purchase additional ordinary shares.

We are an “emerging growth company” under applicable U.S. federal securities laws, and, as such are eligible for certain reduced public company reporting requirements. See the section titled “Prospectus Summary — Implications of Being an Emerging Growth Company” for additional information.

Sharewow Limited, or our Company, is not an operating company, but a holding company incorporated in the Cayman Islands as an exempted company with limited liability. Our daily operations, including product procurement and research and development, are conducted through our operating subsidiaries in the People’s Republic of China (“PRC”). We also generate revenue from countries outside of the PRC, including Australia, Malaysia, Mexico, Singapore, Peru, Spain, the United States. We do not use a variable interest entity structure. Investors purchasing our ordinary shares in this initial public offering are purchasing equity securities of our Cayman Islands holding company and are not purchasing equity securities of our operating subsidiaries. This holding company structure involves unique risks to investors and investors may never hold equity interests in our operating subsidiaries. While we do not operate in an industry that is currently subject to foreign ownership limitations in China, PRC regulatory authorities could decide to limit foreign ownership in our industry or disallow our structure in the future, which could result in a material change in our operations and/or a material change in the value of our ordinary shares, including that it could cause the value of our ordinary shares to significantly decline or become worthless. See “Risk Factors — Risks Related to Doing Business in China — PRC regulatory authorities could regulate our holding company structure.”

Our founder and director, Mr. Libin Kuang, owns 56.6% of our ordinary shares through his ownership of Pinnacle Pioneers Limited before this offering, and will own 47.7% of our ordinary shares upon the completion of the offering. Our co-founder and director, Mr. Shuxun Huang, owns 11.5% of our ordinary shares through his ownership of Galatea Digital Limited, and will own 9.72% of our shares upon the completion of the offering. Accordingly, Mr. Kuang and Mr. Huang have significant influence in determining the outcome of any corporate transaction or other matter submitted to shareholders for approval. Although Messrs. Kuang and Huang, our founder and co-founder, are not currently acting as a group, they may act as a group following the offering, in which case we may be considered a “controlled company” under the Nasdaq rules.

As a holding company, we may rely on dividends from our subsidiaries for our cash requirements, including any payment of dividends to our shareholders. The ability of our subsidiaries to pay dividends to us, however, may be restricted by the debt they incur on their own behalf and/or laws and regulations applicable to them. Unless otherwise indicated or the context otherwise requires, “we,” “us,” “our company,” and “our” refer to Sharewow Limited, our Cayman Islands holding company and its subsidiaries, which include those in the PRC and other countries that conduct daily operations. If needed, cash can be transferred between our Cayman Islands holding company and subsidiaries incorporated in these countries through equity investments and intercompany loans. If our subsidiaries in the PRC realize accumulated after-tax profits, they may, upon satisfaction of relevant statutory conditions and procedures, pay dividends or distribute earnings to our Cayman Islands holding company. To the extent our cash is in PRC or held in our subsidiaries in PRC, the funds may not be available to fund operations or for other use outside of PRC due to interventions in, or the imposition of restrictions and limitations on, the ability of us or our subsidiaries by the PRC government to transfer cash. Currency exchange control measures imposed by the PRC government may restrict the ability of our subsidiaries in the PRC to transfer their cash to our Cayman Islands holding company through loans, advances or cash dividends, primarily in the following aspects: (i) our PRC subsidiaries may be restricted from paying dividends to us, and (ii) we may also be restricted to make loans and additional capital contribution to our subsidiaries. For example, PRC law permits payment of dividends to us by our PRC subsidiaries only out of net

income, if any, determined in accordance with PRC accounting standards and regulations, and each of our PRC subsidiaries is required to set aside at least 10% of its after-tax profits each year, if any, to fund a statutory reserve until such reserve reaches 50% of its registered capital and these reserves are not distributable as cash dividends. In addition, the PRC Enterprise Income Tax Law and its implementation rules provide that a withholding tax rate of up to 10% will be applicable to dividends payable by Chinese companies to non-PRC-resident enterprises unless otherwise exempted or reduced according to treaties or arrangements between the PRC central government and governments of other countries or regions where the non-PRC resident enterprises are incorporated. Loans by us to our wholly-owned PRC subsidiaries to finance their activities cannot exceed statutory limits and must be registered with the local counterpart of SAFE. Capital contributions by us to our PRC subsidiaries are subject to registration with the SAMR or its local branch, reporting of foreign investment information with the PRC Ministry of Commerce, or registration with other governmental authorities in China. The PRC government also imposes controls on the conversion of RMB into foreign currencies. However, we do not expect to make such transfer in the foreseeable future. We intend to keep future earnings to finance the expansion of our business, and do not anticipate that any cash dividends will be paid or any funds will be transferred from our PRC subsidiaries to our Company. We currently do not have cash management policies in place that dictate how funds are transferred between our Company and our subsidiaries. Please see “Risk Factors — Risks Related to Doing Business in China — We may rely on dividends and other distributions on equity paid by our subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our PRC subsidiaries to make payments to us could have a material and adverse effect on our ability to conduct our business. To the extent our cash is in the PRC or held in our subsidiaries in the PRC, the funds may not be available to fund operations or for other use outside of the PRC due to interventions in, or the imposition of restrictions and limitations on, the ability of us or our subsidiaries by the PRC government to transfer cash.” We may also make loans and additional capital contribution to our subsidiaries or branches, subject to certain restrictions under the applicable local laws, including the laws of China. For example, loans by us to our wholly-owned PRC subsidiaries to finance their activities cannot exceed statutory limits and must be registered with the local counterpart of SAFE. Capital contributions by us to our PRC subsidiaries are subject to registration with the State Administration for Market Regulation (the “SAMR”) or its local branch, reporting of foreign investment information with the PRC Ministry of Commerce, or registration with other governmental authorities in China. See “Risk Factors — Risks Related to Our Legal and Regulatory Environment — PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from using the proceeds of our offshore financing to make loans or additional capital contributions to our PRC subsidiaries, which could materially and adversely affect our liquidity and our ability to fund and expand our business.” As a holding company, we may depend on receipt of funds from one or more of our subsidiaries if we determine to pay cash dividends to holders of our ordinary shares in the future. We do not have a regular dividend policy currently, and we have discretion as to whether to declare dividends, subject to certain requirements of Cayman Islands law and our Articles of Association. We currently do not have cash management policies in place that dictate how funds are transferred between us, our subsidiaries, and the investors, as we plan to determine the payment of dividends and fund transfer based on our specific business needs on a case-by-case basis in accordance with the applicable laws and regulations. As of the date of this prospectus, our Cayman Islands holding company had not declared or paid any dividends or distributions on equity to its shareholders. No transfers, dividends, or distributions between Sharewow and its subsidiaries had been made as of the date of this prospectus. No dividends or distributions had been made to U.S. investors as of the date of this prospectus. See “Prospectus Summary — Cash transfers and dividend distributions” for the summary of our cash transfers and dividend distributions.

Pursuant to the Holding Foreign Companies Accountable Act, or the HFCAA, the Public Company Accounting Oversight Board, or the PCAOB, issued a Determination Report in December 2021 which found that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong because of positions taken by the authorities in those jurisdictions. Our auditor, which is based in Singapore, is currently subject to inspection by the PCAOB at least every three years. On August 26, 2022, the PCAOB entered into a Statement of Protocol with the China Securities Regulatory Commission and the Ministry of Finance of the PRC and, as summarized in the “Statement on Agreement Governing Inspections and Investigations of Audit Firms Based in China and Hong Kong” published on the U.S. Securities and Exchange Commission’s official website, the parties agreed to the following: (i) in accordance with the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, the PCAOB shall have independent discretion to select any issuer audits for inspection or investigation; (ii) the PCAOB shall have direct access to interview or take testimony from all personnel of the audit firms whose issuer engagements are being inspected or investigated; (iii) the PCAOB shall have the unfettered

ability to transfer information to the SEC, in accordance with the Sarbanes-Oxley Act; and (iv) the PCAOB inspectors shall have access to complete audit work papers without any redactions, with view-only procedures for certain targeted pieces of information such as personally identifiable information.

On December 15, 2022, the PCAOB issued a report that vacated its December 16, 2021 determination and removed mainland China and Hong Kong from the list of jurisdictions where it is unable to inspect or investigate completely registered public accounting firms. On December 29, 2022, legislation entitled “Consolidated Appropriations Act, 2023,” or the Consolidated Appropriations Act, was signed into law by President Joseph Biden of the United States. The Consolidated Appropriations Act contained, among other things, an identical provision to the Accelerating Holding Foreign Companies Accountable Act, which reduces the number of consecutive non-inspection years required for triggering the prohibitions under the HFCAA from three years to two. Each year, the PCAOB will determine whether it can inspect and investigate completely audit firms in mainland China and Hong Kong, among other jurisdictions. We cannot assure you that we will not be identified by the SEC under the HFCAA as an issuer that has retained an auditor that has a branch or office located in a foreign jurisdiction that the PCAOB determines it is unable to inspect or investigate completely because of a position taken by an authority in that foreign jurisdiction. In addition, there can be no assurance that, if we have a “non-inspection” year, we will be able to take any remedial measures. If any such event were to occur, trading in our securities could in the future be prohibited under the HFCAA and, as a result, we cannot assure you that we will be able to maintain the listing of our ordinary shares on the Nasdaq Capital Market or that you will be allowed to trade our ordinary shares in the United States on the “over-the-counter” markets or otherwise. Should our ordinary shares become not listed or tradeable in the United States, the value of our ordinary shares could be materially affected. See “Risk Factors — Risks Related to Doing Business in China — The continued U.S. regulatory and legislative focus, including the enactment of the HFCAA, may adversely affect the market price of our ordinary shares and may eventually require us to delist our securities from the U.S. markets.” for a detailed discussion.

We have substantial business operations located in mainland China and are subject to PRC laws and regulations. Recently, the PRC government has initiated a series of regulatory actions and made a number of public statements on offerings that are conducted overseas and/or involve foreign investment in China-based issuers, including the Opinions on Strictly Cracking down on Securities-related Illegal Activities in Accordance with the Law (promulgated by the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council on July 6, 2021), the Cybersecurity Review Measures (promulgated by Cybersecurity Administration of China, or the CAC, on December 28, 2021 and became effective on February 15, 2022), the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies, or the Trial Measures (promulgated by the China Securities Regulatory Commission, or the CSRC and became effective on March 31, 2023), and the Provisions on Strengthening Confidentiality and Archives Administration in Respect of Overseas Issuance and Listing of Securities by Domestic Enterprises, or the Confidentiality and Archives Administration Provisions (promulgated by China Securities Regulatory Commission, Ministry of Finance, State Secrecy Administration, State Archives Bureau and became effective on March 31, 2023).

Because these statements and regulatory actions are new and subject to change, it is uncertain as to the potential impact such amended or new legislation will have on our daily business operations or our ability to accept foreign investments and list on a U.S. stock exchange. We face various legal and operational risks associated with being headquartered in China. The PRC government has significant authority to exert influence on the ability of a China-based company, such as us, to conduct its business, accept foreign investments or list on a U.S. or other foreign exchanges. For example, we face risks associated with regulatory approvals on offerings conducted overseas by and foreign investment in China-based issuers, anti-monopoly regulatory actions. These risks could result in a material adverse change in our operations and the value of the securities we are registering for sale or could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or be worthless. Moreover, the Standing Committee of the National People’s Congress or other PRC regulatory authorities may in the future promulgate laws or regulations or implement rules that require our company, or any of our subsidiaries to obtain regulatory approval from PRC authorities before listing in the United States. For risks relating to approval of the CSRC and other PRC government authorities, please refer to “Risk Factors — Risks Related to Doing Business in China — In addition to the filing with the CSRC per the requirements of the Trial Measures, other approval of or filing with the CSRC or other PRC government authorities may be required in connection with our previous or future offshore offerings under PRC laws, and, if required, we cannot predict whether or for how long we will be able to obtain such approval or complete such filing.”

TABLE OF CONTENTS

No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus or in any free writing prospectus we may authorize to be delivered or made available to you. You must not rely on any unauthorized information or representations. This prospectus is an offer to sell only the ordinary shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of the date of this prospectus.

Neither we nor the underwriter have done anything that would permit this offering or possession or distribution of this prospectus or any filed free writing prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus or any filed free writing prospectus must inform themselves about, and observe any restrictions relating to, the offering of the ordinary shares and the distribution of this prospectus or any filed free writing prospectus outside of the United States.

Until            (the 25th day after the date of this prospectus), all dealers that buy, sell or trade the ordinary shares, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the obligation of dealers to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

RISK FACTORS

An investment in our ordinary shares involves significant risks. You should carefully consider all of the information in this prospectus, including the risks and uncertainties described below, before making an investment in our ordinary shares. Any of the following risks could have a material adverse effect on our business, results of operations and financial condition. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and adversely affect our business, prospects, results of operations and financial condition, and our ability to pay dividends. In any such case, the market price of our ordinary shares could decline, and you may lose all or part of your investment.

Risks Related to Our Business and Industry

We participate in a newly developed industry and we may not compete successfully against new and existing competitors, which may materially and adversely affect our results of operations.

The market for 3D photography products and services is new and currently relatively concentrated. Its competitive landscape may change quickly. Our ability to compete may be adversely affected by a number of factors, including:

•        in certain markets, some competitors may have more solid brand awareness than our brands;

•        technological advancements and product improvements by competitors may weaken consumer demand for our products; and

•        consumer preferences may change to lower or higher margin products and services or products and services other than those we offer.

Increased competition may reduce our gross and operating margins, market share and brand recognition. We may not be able to compete successfully against current and future competitors, and competitive pressures may materially and adversely affect our business, financial condition and results of operations.

Our limited operating history and rapid growth markets evaluating our current business and future prospects difficult and may increase the risk of your investment.

Much of our growth has occurred in recent periods. Our limited operating history may make it difficult for you to evaluate our current business and our future prospects, as we continue to grow our business. Our ability to forecast our future operating results is subject to a number of uncertainties, including our ability to plan for and model future growth. We have encountered, and will continue to encounter, risks and uncertainties frequently experienced by growing companies in rapidly evolving industries, as we continue to grow our business. If our assumptions regarding these uncertainties, which we use to plan our business, are incorrect or change in reaction to changes in our markets, or if we do not address these risks successfully, our operating and financial results could differ materially from our expectations, our business could suffer, and the trading price of our stock may decline. It is difficult to predict our future revenues and appropriately budget for our expenses, and we have limited insight into trends that may emerge and affect our business. If actual results differ from our estimates or we adjust our estimates in future periods, our operating results and financial position could be materially affected.

If we fail to meet our customers’ price expectations, demand for our products and services could be negatively impacted and our business and results of operations could suffer.

Demand for our franchise and products is sensitive to price. Therefore, changes in our pricing strategies can have a significant impact on our business and ability to generate revenue. Many factors, including our production and personnel costs and our competitors’ pricing and marketing strategies, can significantly impact our pricing strategies. If we fail to meet our customers’ price expectations in any given period, demand for our franchise and products could be negatively impacted and our business and results of operations could suffer.

We adopt dynamic pricing strategies that allow us to adapt to changing circumstances in local markets and maintain the price competitiveness of our products. Our franchise fees, for instance, are determined based on factors such as the level of support provided to franchisees (e.g. training, marketing and other resources), operational costs of our headquarters’ management and the types of photography equipment chosen by franchisees. Our pricing of

photography equipment is influenced by, among others, the market positions of customers, the scope of services (e.g. on-site technical support and design services) and the level of customization required. If customers find that our prices are not competitive relative to our competitors’, our revenue and overall financial condition may be adversely affected.

If demand for our franchise and products does not grow as expected, or if the demand for 3D photography does not continue to develop, or develops more slowly than expected, our revenues may stagnate or decline, and our business may be adversely affected.

The 3D photography industry remains relatively new. The demand for our franchise and products depends on potential customers’ and end users’ awareness and understanding of 3D photography. We may not be able to develop effective strategies to raise their awareness or our products may not address their specific needs. If 3D photography does not continue to gain broader market acceptance, or if the marketplace adopts 3D photography technologies that differ from our technologies, we may not be able to increase or sustain the level of sales of our products, and our operating results would be adversely affected as a result.

We may not be able to expand our store network cost-efficiently.

Our store network consists of one Self-operated Store, one Jointly-operated Store, Franchise Stores that use our brand, equipment and services as well as Customer-Brand Stores that only purchase 3D photography booths and receive operational support in terms of store management. As of December 31, 2024, we had one Self-operated Store, one Jointly-operated Store, 51 Franchise Stores and nine Customer-Brand Stores. We plan to further expand our store network. However, this planned expansion may not have the desired effect of increasing sales and enhancing our brand recognition in a cost-efficient manner. We may need to invest significant capital and management resources to operate existing chain stores and open new ones, and there can be no assurance that we will be able to improve the operational efficiency of our chain stores.

If we cannot achieve and sustain profitability, our business, financial condition, and operating results may be adversely affected.

Our profitability is subject to changes in financial metrics such as order volumes, costs of revenue and operating expenses. If our sales volumes decrease, or if our costs of revenue and operating expenses increase, our profitability will be adversely affected. Our total revenue increased by approximately RMB1.4 million, or approximately 11.4%, from RMB12,695,831 for the year ended December 31, 2023, to RMB14,146,403 for the year ended December 31, 2024. The increase was primarily due to attributable to the increase in revenue from Franchise Stores and other chain stores. As a result of increase of operating expenses (partially offset by the increase of gross profit), our net loss increased from RMB5,709,723 for the year ended December 31, 2023, to RMB6,599,953 for the year ended December 31, 2024.

We cannot assure you that we will achieve profitability in the near future as we are still at an early stage. Our revenue growth may slow down or our revenue may decline for a number of reasons, including reduced demand for our franchise and products, increased competition, or our failure to capitalize on growth opportunities.

Our research and development efforts may not yield expected results.

Technological innovation is critical to our success, and we strategically develop most of key technologies in-house, such as our 3D photography booths, 3D reconstruction algorithm, AI model repair program and SAAS management system. We have been investing heavily in our research and development efforts. The 3D photography industry is experiencing rapid changes in technology, and we need to invest significant resources in research and development to lead technological breakthrough, in order to remain competitive in the market. Therefore, we expect that our research and development expenses will continue to be significant. Furthermore, research and development activities are inherently uncertain, and there can be no assurance that we will continue to achieve technological breakthroughs and successfully commercialize such breakthroughs. As a result, our significant expenditures on research and development may not generate corresponding benefits. If our research and development efforts fail to keep up with the latest technological developments, we would suffer a decline in our competitive position.

If we made any misjudgment with respect to technological developments or experience any delay or other setbacks in our efforts to improve our technology, it could materially and adversely affect our business, results of operations and prospects.

We rely on our information technology systems to manage numerous aspects of our business and a disruption of these systems could adversely affect our business.

We rely on our information technology systems to manage numerous aspects of our business, including to efficiently purchase products from our suppliers, provide procurement and logistic services, ship products to our customers and end users, manage our accounting and financial functions, including our internal controls, and maintain our research and development data. Our information technology systems are an essential component of our business and any disruption could significantly limit our ability to manage and operate our business efficiently. A failure of our information technology systems to perform properly could disrupt our supply chain, product development and customer and end users experience, which may lead to increased overhead costs and decreased sales and have an adverse effect on our reputation and our financial condition.

Although we take steps and incur significant costs to secure our information technology systems, including our computer systems, intranet and internet sites, email and other telecommunications and data networks, our security measures may not be effective and our systems may be vulnerable to damage or interruption. Disruption to our information technology systems could result from power outages, computer and telecommunications failures, computer viruses, cyber-attack or other security breaches, catastrophic events such as fires, floods, earthquakes, tornadoes, hurricanes, acts of war, terrorism and usage errors by our employees.

Our reputation and financial condition could be adversely affected if, as a result of a significant cyber-event or otherwise:

•        our operations are disrupted or shut down;

•        our confidential, proprietary information is stolen or disclosed;

•        we incur costs or are required to pay fines in connection with stolen customer, employee or other confidential information;

•        we must dedicate significant resources to system repairs or increase cyber security protection; or

•        we otherwise incur significant litigation or other costs.

If our computer systems are damaged or cease to function properly, or, if we do not replace or upgrade certain systems, we may incur substantial costs to repair or replace them and may experience an interruption of our normal business activities or loss of critical data. Any such disruption could adversely affect our reputation and financial condition.

We also rely on information technology systems maintained by third parties, including third-party cloud computing services and the computer systems of our suppliers for both our internal operations and our customer-facing infrastructure. These systems are also vulnerable to the types of interruption and damage described above but we have less ability to take measures to protect against such disruptions or to resolve them if they were to occur. Information technology problems faced by third parties on which we rely could adversely impact our business and financial condition as well as negatively impact our brand reputation.

Because the 3D photography market is rapidly evolving, forecasts of market growth in this prospectus may not be accurate.

Market opportunity estimates and growth forecasts included in this prospectus are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate. The forecasts and estimates in this prospectus relating to the expected size and growth of the 3D photography market may not be accurate. Even if the market experiences the forecasted growth described in this prospectus, we may not grow our business at similar rates, or at all. Our future growth is subject to many factors, including market adoption of our products, which is subject to many risks and uncertainties. Accordingly, the forecasts and estimates of market size and growth described in this prospectus should not be taken as indicative of our future growth.

If the availability of printing consumables and components of 3D photography booths decreases, or these costs increase, and we are unable to either offset or pass along increased costs to our customers, our financial condition, liquidity or results of operations have been and could continue to be adversely affected.

The availability and cost of printing consumables and components of 3D photography booths are critical to our operations. The cost of some of these items may become volatile and availability may be limited at times. We source printing consumables and components of 3D photography booths from a limited number of suppliers in China. Since full-color 3D printing technology has not been popularized, the supply chain of 3D printers is relatively concentrated and we currently face the risk of having only one upstream supplier who we have worked with and tested. The limited number of suppliers, among other things, increases the risk of unavailability. Currently, none of our suppliers are based outside China. However, if we source printing consumables and components of 3D photography booths from foreign suppliers, the prices may be affected by international trade costs such as tariffs, transportation and foreign exchange rates. This dependency and any limited availability could cause us to reformulate products or limit our production. Decreased access to printing consumables and components of 3D photography booths or significant increased cost to purchase these items, as well as increased transportation and trade costs, and any corresponding inability to pass along such costs through price increases or meet demand requirements, as applicable, could have a material adverse effect on our financial condition, liquidity or results of operations. If our printing consumables and components of 3D photography booths suppliers significantly increase the cost of printing consumables and components of 3D photography booths or if they cease offering us such goods, we will have to find new suppliers or lower or cease production of our products. If our 3D printer supplier significantly increases the cost of 3D printers or if it ceases offering us such goods, we will have to find new suppliers or limit our expansion of production.

Our patent applications may not be granted, which may have a material adverse effect on our ability to prevent others from commercially exploiting products similar to ours.

We cannot be certain that we are the first inventor of the subject matter to which we have filed a particular patent application, or if we are the first party to file such a patent application. If another party has filed a patent application for the same subject matter as we have, we may not be entitled to the protection sought by the patent application. Further, the scope of protection of issued patent claims is often difficult to determine. As a result, we cannot be certain that the patent applications that we file will result in the issuance of patents, or that our issued patents will afford protection against competitors with similar technology. In addition, our competitors may design around our issued patents, which may adversely affect our business, prospects, financial condition or operating results.

We are subject to various operational risks inherent in the franchising business model.

Our success could be adversely affected by the performance of our Franchise Stores, which are subject to a variety of risks inherent in our franchising business model. Under this model, we collect franchising, equipment and software licensing fees from franchisees as well as production fees for orders of 3D models that they place. We plan to continue to increase the number of franchisees in the future, but the demand for our franchise may fluctuate depending on market conditions.

Although we provide management support to our Franchise Stores, we cannot assure you that all of them will be profitable. As many factors affecting the operations of Franchise Stores are beyond our control, we cannot assure you that the quality of their services is consistent with our standards and requirements. Although we inspect or communicate with our Franchise Stores on a regular basis, we may not be able to identify problems in their operations and respond on a timely basis. Our Franchise Stores are operated under our brand names. As a result, our image and reputation may suffer due to misuse of our brands by any of our franchisees, which may have a material adverse effect on our business and results of operations. In addition, like any operators in service industries, we are subject to customer complaints and we may face complaints from end users who are dissatisfied with the standard of service offered by our franchisees. Any complaints, regardless of their nature and validity, may affect our reputation, thereby adversely affecting our results of operations. We may also have to incur additional costs in placating any customers or salvaging our reputation. If any of our franchisees defaults or commits wrongdoing, such franchisee may not be in a position to sufficiently compensate us for losses which we have suffered as a result of such defaults or wrongdoings. While we ultimately can take action to terminate our franchisees that do not comply with the terms

of our franchise agreements or commit wrongdoing, we may not be able to identify problems and make timely responses and, as a result, our image and reputation may suffer, which may have a material adverse effect on our results of operations.

Although our proprietary information system can collect operational and financial data of each franchise store, we may not be able to avoid fraud or manipulation of such data by some franchisees, which may adversely affect the ability to effectively identify potential issues.

We may not be able to successfully attract new franchisees and compete for franchise agreements and, as a result, we may not be able to achieve our planned growth.

Our growth strategy largely depends on our ability to further expand our presence through entering into franchise agreements with our franchisees. We believe that our ability to attract new franchisees and compete for franchise agreements with them depends primarily on our brand recognition and reputation, the results of our overall operations and the success of our current Franchise Stores. Other factors include marketing support, membership program, efficiency of our IT infrastructure, as well as our ability to provide systems and support to help franchisees operate their stores cost-effectively.

The terms of any new franchise agreements also depend on the terms that our competitors offer. In addition, if the availability of suitable locations for new properties decreases, or governmental planning or other local regulations change, the supply of suitable properties for additional Franchise Stores could diminish. If our Franchise Stores perform less well than those of our competitors or if we are unable to offer terms as favorable as those offered by our competitors, we may not be able to compete effectively for new franchise agreements and we may not be able to attract as many new franchisees as we expect. As a result, we may not be able to achieve our planned growth and our business and results of operations may be materially and adversely affected.

Our franchise and management agreements could be terminated early and we may not be able to renew our existing franchise agreements or renegotiate new franchise agreements when they expire.

We franchise our brands to third parties pursuant to franchise agreements that we enter into with franchisees. These franchise agreements may be renegotiated or may expire. Our franchise agreements typically have a fixed term of 3 years. We plan to renew our existing franchise agreements upon expiration or renegotiate new franchise agreements with our franchisees. However, we may be unable to retain our franchisees on satisfactory terms, or at all. In addition, our franchise agreements could also be terminated early due to property disputes or defects, franchisees’ financial difficulties, regulatory non-compliance, and other factors, many of which are beyond our control. For example, according to our franchise agreement, when (i) franchisees’ financial situation deteriorate, (ii) the franchisee loses ability to repay its debt, or (iii) the franchisee file for bankruptcy, enters into bankruptcy proceedings or is deemed by a court to be bankrupt, then we may unilaterally terminate the franchisee agreement and the franchisee shall indemnify all of our losses. If a significant number of our existing franchise agreements expire or a significant number of our franchisees terminate the franchise agreements with us early, our revenue and profit may decrease in the future, and our results of operations could be materially and adversely affected.

In addition, disputes could arise between us and our franchisees under our franchise agreements. We and our franchisees may take legal actions against each other in connection with such disputes. No assurance can be given as to the outcome of any such legal proceedings, which could have a material adverse effect on our business, results of operations and financial condition. Even if we and our related parties are successful in our attempt to defend ourselves in legal and administrative actions or to assert our rights under various laws, enforcing our rights against the various parties involved may be expensive, time-consuming and ultimately futile. These actions could expose us to negative publicity and to substantial monetary damages and legal defense costs, injunctive relief, and criminal and civil liabilities and/or penalties.

According to the Industry Report, the 3D photography industry in China is currently relatively concentrated. However, the industry may become more competitive with new market entrants in the future. The terms of our franchise agreements are influenced by contract terms offered by our competitors. We cannot assure you that the terms of new franchise agreements entered into or renewed in the future will be as favorable as the terms under our existing franchise agreements. If such agreements cannot be renewed on satisfactory terms, or at all, upon expiration, our results of operations could be materially and adversely affected.

Our failure to comply with franchise regulations may result in penalties to us and could have a material adverse effect on our business.

In China, any entity engaging in franchise activities is subject to the supervision and administration of the Ministry of Commerce (“MOC”) and its local counterparts. Under the relevant regulations, franchisors are required to file their franchise agreements with the MOC or its local counterparts, and are required to report to the MOC regarding the franchise agreements that they executed, canceled, renewed or amended in the previous year within the first quarter of every year. Fifteen days after a franchisor first enters into a franchise agreement, the franchisor is required to make appropriate filing with the MOC or its local counterparts. We cannot guarantee that we will obtain all applicable approvals and make all appropriate filings pursuant to laws and regulations, and such non-compliance could subject us to fines and other penalties that may negatively affect our operation, which could result in a material adverse effect on our business.

In addition, franchise activities are subject to various laws and regulations. For example, before entering into franchise agreements, the franchisor is required to correctly, accurately and fully disclose and provide specified written information to the franchisee regarding the franchised businesses, which includes certain proprietary information. If we violate the disclosure requirements related to franchise activities, our franchisees may choose to terminate their franchise agreements with us, and we could be subject to fines and other penalties that may negatively affect our operation, which could result in a material adverse effect on our business. All franchise agreements are also required to include certain provisions, such as termination rights and payment obligations. If we are required to revise our agreements pursuant to applicable laws and regulations, such revised terms may be less favorable to us, which could materially diminish the economic value of our agreements.

As our intellectual property rights may expire and may not be extended, our applications may not be granted, and our intellectual property rights may be contested, circumvented, invalidated, or limited in scope, our intellectual property rights may not protect us effectively. In particular, we may not be able to prevent others from developing or exploiting competing technologies, which could materially and adversely affect our business, financial condition, and results of operations.

We rely on a combination of patents, trademarks, copyrights, trade secrets and confidentiality agreements to protect our proprietary rights. As of December 31, 2024, we had 5 registered patents (including four utility model patents and one design patent covering 3D photography booths, projectors and 3D portrait package designs), 15 pending patent applications, 18 copyright licenses, 46 registered trademarks and 3 registered domain names in China. We rely on trademark and patent law, trade secret protection and confidentiality and license arrangements or agreements with our affiliates, employees and others to protect our intellectual property rights. In addition, any unauthorized use of our intellectual property by third parties may adversely affect our current and future revenues and our reputation.

Our commercial success will depend in part on our success in obtaining and maintaining issued patents, trademarks and other intellectual property rights in China and elsewhere and protecting our proprietary technology. If we do not adequately protect our intellectual property and proprietary technology, competitors may be able to use our technologies or the goodwill we have acquired in the marketplace and erode or negate any competitive advantage we may have, which could harm our business and ability to achieve profitability.

We rely on or intend to rely on our trademarks, trade names and brand names to distinguish our products from the products of our competitors, and have registered or will apply to register a number of these trademarks. However, we cannot ensure that any of our pending trademark applications necessary for business operation will issue as trademarks. We cannot provide any assurances that any of our trademarks have, or that any of our pending trademark applications that mature into issued trademarks will include, claims with a scope sufficient to protect our products, any additional features we develop for our products or any new products. Governmental authorities or third parties may oppose our trademark applications or otherwise challenge our use of the trademarks.

There can be no assurance that our application for the registration with competent government authorities of trademarks and other intellectual property rights related to our current or future business will be approved, or our intellectual property rights will not be challenged by third parties or found by the relevant governmental or judicial authority to be invalid or unenforceable. From time to time, we may encounter difficulties registering our intellectual

properties or have disputes with third parties regarding our intellectual properties. If the relevant trademarks or other intellectual properties could not be registered, we may fail to prevent others from using such intellectual properties, and our business, financial condition and results of operations may be materially and adversely affected.

In particular, the rights granted under any issued patents may not provide us with meaningful protection or competitive advantages. The claims under any patents that issue from our patent applications may not be broad enough to prevent others from developing technologies that are similar or that achieve results similar to ours. It is also possible that the intellectual property rights of others could bar us from licensing and exploiting any patents that issue from our pending applications. Numerous patents and pending patent applications owned by others exist in the fields in which we have developed and are developing our technology. These patents and patent applications might have priority over our patent applications and could subject our patent applications to invalidation. Finally, in addition to those who may claim priority, any of our existing or pending patents may also be challenged by others on the basis that they are otherwise invalid or unenforceable.

Policing unauthorized use of proprietary technology is difficult and expensive. Despite our efforts to protect our proprietary rights, third parties may attempt to copy or otherwise obtain and use our intellectual property or seek court declarations that they do not infringe upon our intellectual property rights. Monitoring unauthorized use of our intellectual property is difficult and costly, and we cannot assure you that the steps we have taken or will take will prevent misappropriation of our intellectual property. From time to time, we may have to resort to litigation to enforce our intellectual property rights, which could result in substantial costs and diversion of our resources.

In addition, as our patents may expire and may not be extended and our patent rights may be contested, circumvented, invalidated or limited in scope, our patent rights may not protect us effectively. In particular, we may not be able to prevent others from developing or exploiting competing technologies, which could have a material and adverse effect on our business operations, financial condition and results of operations. If we are unable to adequately protect our intellectual property rights, it could adversely affect our business and our brand.

We may be liable for intellectual property infringement relating to intellectual property of third parties, which may materially and adversely affect our business, financial condition and prospects.

We cannot assure you that our operations do not or will not infringe upon or violate intellectual property rights (including but not limited to trademarks, patents, copyrights, know-how) or other rights (including but not limited to personality rights) owned or held by third parties. We may be involved in claims against us alleging our infringement of third-party intellectual property rights. Any such intellectual property rights infringement claim could result in costly remedial measures and may adversely affect our business and financial condition. We have adopted systematic methods to reduce our exposure to the risks of intellectual property infringement claims. However, we cannot assure you those methods are sufficient to shield us from third party liabilities for intellectual property infringement, or our efforts will be considered favorably by a given court or relevant governmental authority. Liabilities for intellectual property infringement, or allegations of such infringement, may impose a burden on our management, cause penalties, lead to unfavorable media coverage and damage to our reputation, or even cause PRC authorities to impose sanctions on us, including, in serious cases, suspending our operation, which may materially and adversely affect our business, financial condition and prospects.

We may not be able to prevent unauthorized use of our intellectual property, which could harm our business and competitive position.

We consider our trademarks, patents domain names, trade secrets, proprietary technologies and similar intellectual property as critical to our success and we currently rely on a mix of trademark law, patent law, and confidentiality agreements with our employees and others to protect our proprietary rights. Our trademarks and patents may be invalidated, circumvented or challenged. Confidentiality agreements may be breached and we may not have adequate remedies for any breach.

Our products may be counterfeited. Unauthorized imitation, replication of our design, infringement of our trademarks or labeling by third parties may affect our reputation and profitability. Although we monitor any unauthorized use of our registered designs and trademarks, counterfeiting or imitation of our products to ensure that our intellectual property rights are protected, we cannot assure you that counterfeiting and imitation would not occur, or if it does occur, that we would be able to detect and address the problem effectively. A significant presence of

counterfeit products in the market could have a negative impact on the value and image of our brands, lead to loss of consumer confidence in our brands and materially and adversely affect our business, financial condition and results of operations.

Claims by third parties that we are infringing their intellectual property and other litigation may materially and adversely affect our business and prospects.

From time to time, we may be subject to claims that we are infringing the patents and other intellectual property of others, and it is possible that third parties will assert infringement, misappropriation, unfair competition or similar claims against us in the future. Any such claims, charges or judicial procedures, with or without merit, could be time-consuming and expensive and may require us to incur substantial costs, including the diversion of the resources of management and technical personnel, cause product delays or require us to redesign our products or enter into licensing or other agreements in order to secure continued access to necessary or desirable intellectual property.

An adverse finding against us in these or similar patent or other intellectual property disputes may have a material adverse effect on our business, financial condition and results of operations. If we are deemed to be infringing or otherwise violating a third party’s intellectual property and are unable to continue using that intellectual property as we had been, our business and results of operations could be harmed if we are unable to successfully develop non-infringing alternative products or features on a timely basis or license non-infringing alternatives or substitutes, if any exist, on commercially reasonable terms. In addition, an unfavorable ruling in intellectual property litigation proceedings could subject us to significant liability, as well as requiring us to cease developing, manufacturing or selling the affected products or using the affected processes or product features. Any significant restriction on our proprietary intellectual property or operations that impedes our ability to develop and commercialize our products could have a material adverse effect on our business, financial condition and results of operations.

Default in payment by franchisees and/or corporate clients that have large account receivable balances could adversely impact our cash flows, working capital and financial condition.

Our accounts receivable include amounts due from our franchisees and corporate clients. Our net accounts receivable balance was RMB344,909 and RMB847,372 as of December 31, 2023 and 2024, respectively. Our corporate clients pay us directly, and we typically require our franchisees to pay fees pursuant to their franchise agreements on a yearly basis. We are subject to the risk that we may be unable to collect accounts receivable in a timely manner, or at all. Our franchisees and/or corporate account clients may not be able to pay us in a timely fashion and our accounts receivable and allowance for credit losses may accordingly increase. We may also need to extend credit terms to certain franchisees experiencing financial difficulties. Our liquidity and cash flows from operations may be adversely affected if our accounts receivable cycles or collections periods lengthen or if we encounter a material increase in defaults of payment of our accounts receivable.

Our due diligence checks on prospective franchisees and regular assessment of the creditworthiness of corporate clients cannot always ensure that we will be able to collect accounts receivable. If the accounts receivable cannot be collected in time, or at all, a significant amount of bad debt expense will result, and our business, financial condition and results of operation will likely be materially and adversely affected.

We face risks associated with the misconduct of our employees and other related personnel.

Many of our employees play critical roles in ensuring the safety and reliability of our products and services and/or our compliance with relevant laws and regulations. Certain of our employees have access to sensitive information and/or proprietary technologies and know-how. While we have adopted codes of conduct for all of our employees and implemented detailed policies and procedures relating to intellectual property, proprietary information and trade secrets, we cannot assure you that our employees will always abide by these codes, policies and procedures nor that the precautions we take to detect and prevent employee misconduct will always be effective. If any of our employees engage in any misconduct, illegal or suspicious activities, including but not limited to, misappropriation or leakage of sensitive client information or proprietary information, we and such employees could be subject to legal claims and liabilities and our reputation and business could be adversely affected as a result.

In addition, while we have screening procedures during the recruitment process, we cannot assure you that we will be able to uncover misconduct of job applicants that occurred before we offered them employment, or that we will not be affected by legal proceedings against our existing or former employees as a result of their actual or alleged misconduct. We have put in place various safeguards and spend significant amount of time and efforts to address the risk of unauthorized third-party information being introduced into our systems or used in our operations. We could be involved in related proceedings that may arise in the future, or be forced to defend against any allegations in the future, even when the allegations are not justified. Any negative publicity surrounding these allegations, especially in the event that any of these employees is found to have committed any wrongdoing, could negatively affect our reputation and may have an adverse impact on our business. Likewise, suppose our sales forces do not comply with applicable laws and regulations, for example, false or misleading promotion, this could materially impact our brand image and customers’ trust in our brand and could result in harming our business and financial condition.

If we fail to maintain our relationships with our members and corporate account clients, our business and financial condition could be materially and adversely affected.

Historically, we have derived a portion of our revenues from government units and corporate clients. As of December 31, 2023 and December 31, 2024, we had three and nine government-owned enterprise clients who generated a total revenue of RMB1,648,000 and RMB393,405 in the corresponding periods, respectively. We are not subject to any additional requirements in contracting with government units. We expect that government units and corporate clients will contribute to the growth of our business in the near future. However, we cannot assure you that they will agree to renew the relevant agreements upon their expiration, or enter into new agreements with us on substantially similar terms. Our negotiating position with government and corporate clients is also limited given the competition in China’s 3D photography industry. If we fail to enhance or maintain our relationships with clients, or if our clients decline to renew their agreements or propose new agreements with commercial terms less favorable to us, our business and financial condition could be materially and adversely affected.

Our operating results and financial condition may fluctuate from period to period.

Our operating results and financial condition may fluctuate from period to period due to a number of factors, many of which will not be within our control. Both our business and the 3D photography industry are changing and evolving rapidly, and our historical operating results may not be useful in predicting our future operating results. If our operating results do not meet the guidance that we provide to the marketplace or the expectations of securities analysts or investors, the market price of our securities will likely decline. Fluctuations in our operating results and financial condition may be due to a number of factors, including:

•        the degree of market acceptance of our products and services;

•        our ability to compete with competitors and new entrants into our markets;

•        the mix of products and services that we sell during any period;

•        the timing of the sales and deliveries of our products to customers and end users;

•        the geographic distribution of our sales;

•        changes in our pricing of our products, our pricing recommendation to our Franchise Stores or those of our competitors, including our response to price competition;

•        changes in the amount that we spend to develop new products or technology;

•        changes in the amounts that we spend to promote our products and services;

•        expenses and/or liabilities resulting from litigation;

•        delays between our expenditures to develop and market new or enhanced solutions and the generation of revenue from those solutions;

•        disruptions to our information technology systems or our third-party contract manufacturers;

•        general economic and industry conditions that affect customer demand; and

•        changes in accounting rules and tax laws.

In addition, our revenues and operating results may fluctuate from period to period due to the seasonality of our business. As a result, revenues and operating results for future periods are difficult to predict with any significant degree of certainty, which could lead to adverse effects on overall financial condition.

Our business is subject to seasonal fluctuations and unexpected interruptions.

We generally experience more purchase orders during holiday seasons, such as the Chinese New Year and Christmas holidays. However, our limited operating history makes it difficult for us to judge the exact nature or extent of the seasonality of our business. We may record a significant increase in revenue when we commence mass delivery of products to fulfill customer orders accumulated in prior periods, but we may not be able to maintain our revenue at similar levels in subsequent periods. Our financial condition and results of operations may continue to fluctuate and our historical results may not be comparable to future results. In addition, we are vulnerable to natural disasters, health epidemics, and other calamities that may undermine the demand for our products and services. Any of such occurrences could cause severe disruption to our business operations, and may even require a temporary closure of facilities and logistics delivery networks, which may disrupt the business operations of our stores and adversely affect our results of operations.

Changes in international, regional or domestic economic conditions, rising interest rates, fiscal or political uncertainty, policy adjustments, market volatility, disruption to the global capital or credit markets, or the public perception that any of these events is likely to occur may have a negative impact on our industry, which in turn might have material and adverse effects on us. Our business is likewise subject to unexpected interruptions. In addition to the COVID-19 outbreak, there have been other outbreaks of epidemics in China and globally in recent years. Our operations could be disrupted if one of our employees is suspected of having COVID-19, H1N1 flu, avian flu, or other epidemics, since it could require our employees to be quarantined and/or our offices to be disinfected. In addition, our results of operations could be adversely affected to the extent that the outbreak harms China’s economy in general.

We also expect our period to period operating results to vary based on our operating costs, which we anticipate will increase significantly in the future periods as we, among other things, develop new technological capabilities, ramp up our manufacturing facilities and expand our store network and general and administrative functions to support our growing operations. We may incur substantial research and development and/or selling expenses when we develop and/or promote new products in a given period without generating any revenue from such products until we start delivery of such products to customers in the future periods. As a result of these factors, we believe that period to period comparisons of our operating results are not necessarily meaningful and that these comparisons may not be indicative of future performance. Moreover, our operating results may not meet expectations of equity research analysts or investors. If this occurs, the trading price of our securities could fall substantially either suddenly or over time.

A severe or prolonged downturn in the PRC or global economy could materially and adversely affect our business, results of operations and financial condition.

The success of our business ultimately depends on consumer spending. We derive a substantial part of our revenues from China. As a result, our revenues and financial results are impacted to a significant extent by economic conditions in China and globally. The global macroeconomic environment is facing challenges, including the economic slowdown in the Eurozone since 2014, potential impact of the United Kingdom’s exit from the EU on January 31, 2020, and the adverse impact on the global economies and financial markets of epidemics such as the COVID-19 outbreak. The growth of the PRC economy has slowed down since 2012 compared to the previous decade and the trend may continue. The long-term effects of the expansionary monetary and fiscal policies adopted by the central banks and financial authorities of some of the world’s leading economies, including the United States and China, is still evolving and subject to changes. There have been concerns over unrest and terrorist threats in the Middle East, Europe and Africa and over the conflicts involving Ukraine, Syria and North Korea. The relationship among China and other Asian countries and the trade disputes between the United States and China may also have adverse effects on the overall economic environment. The ongoing trade tensions between the United States and

China may have tremendous negative impact on the economies of not merely the two countries concerned, but the global economy as a whole. It is unclear whether these challenges and uncertainties will be contained or resolved, and what effects they may have on the global political and economic conditions in the long term.

Economic conditions in China are responsive to global economic conditions, changes in domestic economic and political policies, and the expected or perceived overall economic growth rate in China. While the economy in China has grown significantly over the past decades, growth has been uneven, both geographically and among various sectors of the economy, and the rate of growth has been slowing in recent years. Although growth of China’s economy remained relatively stable, there is a possibility that China’s economic growth may materially decline in the near future. Any prolonged slowdown in China’s economic development might lead to tighter credit markets, increased market volatility, sudden drops in business and consumer confidence and dramatic changes in business and consumer behaviors. The potential adverse economic conditions may cause a significant impact on our ability to raise capital, if needed, on a timely basis and on acceptable terms or at all.

Sales of non-essential consumer products, such as our 3D photography portraits, depend in part on discretionary consumer spending and are even more exposed to adverse changes in general economic conditions. In response to their perceived uncertainty in economic conditions, consumers might delay, reduce or cancel purchases and our results of operations may be materially and adversely affected.

Rising international political tension and recent disruptions in the financial markets and economic conditions may adversely impact our business and operating results.

Political tensions between the United States and China have escalated in recent years due to, among other things, the trade war between the two countries since 2018, the COVID-19 outbreak, the PRC National People’s Congress’ passage of Hong Kong national security legislation, the imposition of U.S. sanctions on certain Chinese officials from China’s central government and the Hong Kong Special Administrative Region by the U.S. government, and the imposition of sanctions on certain individuals from the U.S. by the Chinese government.

The U.S. government has made statements and taken certain actions that may lead to potential changes to U.S. and international trade policies towards China. In January 2020, the “Phase One” agreement was signed between the United States and China on trade matters. However, it remains unclear what additional actions, if any, will be taken by the U.S. or other governments with respect to international trade agreements, the imposition of tariffs on goods imported into the U.S., tax policy related to international commerce, or other trade matters. While cross-border business may not currently be an area of our focus, any unfavorable government policies on international trade, such as capital controls or tariffs, may affect the demand for our products and services, impact the competitive position of our products or prevent us from selling products in certain countries. Moreover, many of the recent policy updates in the United States, including the Clean Network project initiated by the U.S. Department of State in August 2020 and the Entity List regime maintained and regularly updated by the U.S. Bureau of Industry and Security, may have unforeseen implications for our business. If any new tariffs, legislation or regulations are implemented, or if existing trade agreements are renegotiated or, in particular, if the U.S. government takes retaliatory trade actions due to the recent U.S.-China trade tension, such changes could have an adverse effect on our business, financial condition and results of operations.

Additionally, in recent years, the United States and global economies suffered dramatic downturns as the result of a deterioration in the credit markets and related financial crisis as well as a variety of other factors including, among other things, extreme volatility in security prices, severely diminished liquidity and credit availability, ratings downgrades of certain investments and declining valuations of others. The United States and various foreign governments have taken unprecedented actions in an attempt to address and rectify these extreme market and economic conditions by providing liquidity and stability to the financial markets, which may have a negative impact on our business, financial condition and results of operations. If the actions taken by these governments are not successful, the return of adverse economic conditions may cause a significant impact on our ability to raise capital, if needed, on a timely basis and on acceptable terms or at all.

The prospects of our business depend substantially on the recognition, maintaining and strengthening our brands to generate and maintain ongoing demand for our products.

The “Suwa” and “Sharewow” brands and related brand images are integral to the growth of our business, as well as to the implementation of our strategies for expanding our business into new categories and markets. Our success depends on the value and reputation of our brands, which, in turn depend on factors such as the quality, design, performance, functionality and durability of our products, our communication activities, including advertising, social media, various commercial initiatives, and public relations, and our management of the consumer experience. Maintaining, promoting and positioning our brands is important to expanding our consumer base and will depend largely on the success of our marketing efforts and our ability to provide consistent, high-quality consumer experiences. We intend to continue making substantial investments in these areas in order to maintain and enhance our brands, but such investments may not be successful.

Ineffective marketing, negative publicity, product or manufacturing defects, product recalls, counterfeit products, failure to protect the intellectual property rights in our brands and detrimental acts by third parties are potential threats to the strength of our brands, and those and other factors could rapidly and severely diminish consumer confidence in us, which may materially and adversely affect our business, financial condition or results of operations. Additionally, the growing use of social media increases the speed with which information and opinions can be shared and the speed with which a company’s reputation can be affected. If we fail to correct or mitigate misinformation or negative information, including information spread through social media or traditional media channels, about us, the products we offer, our consumer experience or any aspect of our brands, our business, financial condition and results of operations could be adversely impacted. Maintaining and enhancing the image of our brands in our current key markets, and in new markets where we currently may have limited brand recognition, is important to expanding our consumer base. If we are unable to maintain or enhance our brands in current or new markets, or if we fail to continue to successfully market and sell our products to our existing consumers or expand our consumer base, growth strategy, business, financial condition and results of operations could be harmed.

If our suppliers fail to use ethical business practices and comply with applicable laws and regulations, our brand image could be harmed due to negative publicity.

Our core values, which include developing high quality 3D portraits while operating with integrity, are an important component of our brand image, which makes our reputation sensitive to allegations of unethical business practices. We do not control our independent suppliers or their business practices. Accordingly, we cannot guarantee their compliance with ethical business practices, such as environmental responsibilities, fair wage practices, and compliance with child labor laws, among others. A lack of demonstrated compliance could lead us to seek alternative suppliers, which could increase our costs and result in delayed delivery of our products, product shortages or other disruptions of our operations.

Violation of labor or other laws by our suppliers or the divergence of an independent supplier’s labor or other practices from those generally accepted as ethical in the markets in which we do business could also attract negative publicity for us and our brand. This could diminish the value of our brand image and reduce demand for our franchise and products if, as a result of such violation, we were to attract negative publicity. If we, or other players in our industry, encounter similar problems in the future, it could harm our brand image, business, prospects, results of operations and financial condition.

We currently derive the majority of our revenue from franchising and any event that adversely affects the demand for our franchising business may harm our growth strategies and business prospects.

As of December 31, 2023 and December 31, 2024, we generated approximately 91.7% and 96.7% of our total revenue from our franchising business. A decrease in the demand for our franchising business could have material and adverse effects on our business prospects. While we have expanded and diversified our business segments, the revenue derived from these categories may not reach a level that would reduce our dependence on our franchising business. In addition, if we are unable to deliver consistently high quality products, the number of customers and end users for our products may decline. Our failure to successfully introduce new product categories may have a material and adverse effect on our business prospects and limit our growth.

Our plan to expand our sales and marketing efforts may be costly, and any failure to manage our growth or execute our marketing strategies effectively may materially and adversely affect our business and prospects.

We plan to continue to utilize a number of marketing initiatives to promote our brands. We have invested and will need to continue to dedicate significant time, efforts, and resources to advertising and market promotion initiatives. Our sales and marketing expenses (including salaries of sales and marketing staff, advertising fee and other expenses) were approximately RMB4,343,407 and RMB5,142,612 as of December 31, 2023 and 2024, representing approximately 34.2% and 36.4% of our revenue, respectively. We may need to devote an even greater portion of our resources to continue to strengthen our brand recognition and build our user base, which may impact our profitability. We cannot assure you that our marketing efforts will ultimately be successful, as they are driven by various factors, including the effectiveness of our marketing campaigns, our ability to provide consistent, high quality products, consumers’ satisfaction with our products, as well as support and services we provide, among others. Our future operating results will depend to a large extent on our ability to manage our expansion and growth successfully.

Risks that we face in undertaking this expansion include, among others:

•        managing a larger organization with a greater number of employees in different divisions;

•        controlling expenses and investments in anticipation of expanded operations;

•        establishing or expanding design, manufacturing, sales and service facilities;

•        implementing and enhancing administrative infrastructure, systems and processes; and

•        executing our strategies and business initiatives successfully.

In addition, any negative publicity related to our brand, products, suppliers, distributors, retail stores, third-party platforms or key opinion leaders (“KOLs”) that we are associated with could have an adverse impact on our brand, which may materially and adversely affect our business and prospects.

Any failure to quickly identify and adapt to changing industry conditions and consumer preferences may have a material and adverse effect on our business, financial condition and results of operations.

Our growth depends, in part, on our ability to successfully introduce new technology to meet the evolving requirements of our customers and end users. This, in turn, depends on our ability to foresee and respond to evolving consumer trends, demands and preferences, especially those related to 3D photography products. The research and development of new products involve considerable costs, and may not generate sufficient customer interest or sales to cover their development or marketing expenses, which may reduce our operating income. In addition, any such unsuccessful effort may adversely affect our brand and reputation. To the extent that we are not able to successfully identify customer and end users preferences, develop or promote new products, we may lose our competitive edge in the market and our business, financial condition and results of operations may be adversely affected.

If we are unable to attract, train and retain qualified personnel, our business, financial condition and results of operations may be materially and adversely affected.

Our business is supported and enhanced by a team of highly skilled employees who are critical to maintaining the quality and consistency of our business and reputation. It is important for us to attract qualified employees, especially our research and development staff and technicians. Competition for these employees is intense. In order to attract prospective employees and retain current employees, we may have to increase our employee compensation by a larger amount and at a faster pace than expected, which would increase our operating expenses. In addition, we must hire and train qualified employees in a timely manner to keep pace with our growth while maintaining the quality of our operations.

We must also provide continuous training to our employees so that they have up-to-date knowledge of various aspects of our operations and can meet our demand for high quality products and services. If we fail to do so, the quality of our services may deteriorate in one or more of the markets where we operate, which may cause a negative perception of our brands and adversely affect our business. Finally, disputes between us and our employees may arise from time to time and if we are not able to properly handle our relationship with our employees, our business, financial condition and results of operations may be adversely affected.

Actual or alleged failure to comply with data privacy and protection laws and regulations could damage our reputation, and discourage consumers from purchasing our 3D photography products and services.

We are subject to various data privacy and protection laws and regulations in China, including, without limitation, the Cybersecurity Law, the PRC Data Security Law (“Data Security Law”), the Personal Information Protection Law. Pursuant to these laws and related regulations, a service provider is required to obtain a user’s consent to collect the user’s personal information. See “Regulation — Regulations on Cybersecurity, Data Security and Personal Information Protection.”

We have adopted strict information security policies, and we use a variety of technologies to protect the data with which we collect and process. We mainly collect and store personal information about end users such as their names, order details, and logistics shipping information (such as addresses and phone numbers). To the extent we collect end users information, we obtain prior consent from our end users in accordance with applicable laws and regulations. We adopt necessary technical and organizational measure to ensure data storage security.

Nevertheless, collection, use and transmission of end users’ data may subject us to legislative and regulatory burdens in China and other jurisdictions, which could, among other things, require notification of data breach, restrict our use of such information and hinder our ability to acquire new customers or end users or serve existing customers. We have not experienced any material noncompliance with respect to data privacy and protection laws and regulations. If we were found to be in violation of end users’ rights to data privacy, we could face administrative investigation, disciplinary actions, civil claims and reputational damage. We may incur significant expenses to comply with laws and regulations relating to data privacy, data security and consumer protection, as well as relevant industry standards and contractual obligations. If third parties improperly obtain and use the personal information of end users, we may be required to expend significant resources to resolve such problems.

In addition, the interpretation and application of personal information protection laws and regulations and standards are still uncertain and evolving. We cannot assure you that relevant governmental authorities will not interpret or implement the laws or regulations in ways that negatively affect us. We may also become subject to additional or new laws and regulations regarding the protection of personal information or privacy-related matters in connection with our methods for data collection and storage. In addition to the regulatory requirements, consumer attitudes towards data privacy are also evolving, and consumer concerns about the extent to which their data is collected by us may adversely affect our ability to gain access to data and improve our technologies, products and services. If consumers allege that we have improperly collected, used, transmitted, released or disclosed their personal information, we could face legal claims and reputational damage. Furthermore, the integrity of our data protection measures could be compromised by system failures, security breaches or cyberattacks. If we are unable to comply with the applicable laws and regulations or effectively address data privacy and protection concerns, such actual or alleged failure could damage our reputation, discourage franchisees from working with us and consumers from purchasing our products and services and subject us to significant legal liabilities.

Our services, including those provided through third parties, may not be generally accepted by our customers. If we are unable to provide or arrange adequate services for our customers, our business and reputation may be materially and adversely affected.

We cannot assure you that our services or our efforts to engage with our customers using both our online and offline channels, will be successful, which could affect our revenues as well as our customer satisfaction and marketing. Moreover, we are unable to ensure the availability or quality of services provided by third parties. If any of the services provided by third parties becomes unavailable or inadequate, our customers’ experience may be adversely affected, which in turn may materially and adversely affect our business and reputation. For instance, our 3D portraits are delivered by third-party delivery services provider. We cannot assure you that our service arrangements will adequately address the service requirements of our customers to their satisfaction, or that our delivery services provider will have sufficient resources to meet these service requirements in a timely manner as the volume of goods we deliver increases. If we and our delivery services providers are unable to meet customers’ service requirements, customer satisfaction could be adversely affected, which in turn could materially and adversely affect our sales, results of operations, and prospects.

We may be subject to litigation, allegations, complaints, investigations and penalties from time to time, which may adversely affect our business, financial condition and results of operations.

We may be subject to litigation, allegations, complaints, investigations and penalties from time to time relating to issues including intellectual property, employment and labor, product safety, personal injury, privacy, information security, tax compliance, as well as licenses and permits. Legal proceedings are inherently uncertain, and any judgment, ruling, fine, penalty or injunctive relief entered against us or any adverse settlement in these matters could result in harm to our reputation, sanctions, consent decrees, injunctions or orders requiring a change in our business practices or otherwise negatively affect our business, result in costly litigation, be harmful to our reputation and divert significant resources.

We may need to raise additional capital in the future for working capital, capital expenditures and/or acquisitions, and we may not be able to do so on favorable terms or at all, which would impair our ability to operate our business or achieve our growth objectives.

Our ongoing ability to generate cash is important for funding our continuing operations, making acquisitions and servicing our indebtedness. To the extent that existing cash balances and cash flow from operations, together with borrowing capacity are insufficient to make investments or acquisitions or provide needed working capital, we may require additional financing from other sources. In addition, our ability to undertake large investments or consummate significant acquisitions will depend on the availability of equity and debt financing. Our ability to obtain such additional financing in the future will depend in part upon prevailing capital market conditions and conditions in our business and our operating results. Those factors may affect our efforts to arrange additional financing on terms acceptable to us. We cannot assure you that we will be able to obtain new financings in the future on favorable terms or at all.

Furthermore, if global economic, political or other market conditions adversely affect the financial institutions that provide credit to us, it is possible that our ability to draw upon credit facilities may be impacted. If adequate funds are not available, or are not available on acceptable terms, we may not be able to make future investments, take advantage of acquisitions or other opportunities, or respond to competitive challenges, resulting in loss of market share, each of which could have a material adverse impact on our financial position, results of operations, cash flows and liquidity.

We are subject to restrictions on currency exchange.

All of our revenue is denominated in Renminbi. The Renminbi is currently convertible under the “current account,” which includes dividends, trade and service-related foreign exchange transactions, but not under the “capital account,” which includes foreign direct investment and loans, including loans we may secure from our PRC subsidiaries. Currently, our PRC subsidiaries may purchase foreign currency for settlement of “current account transactions,” including payment of dividends to us, by complying with certain procedural requirements. However, we cannot assure you that the relevant PRC governmental authorities will not limit or eliminate our ability to purchase foreign currencies in the future for current account transactions. Foreign exchange transactions under the capital account remain subject to limitations and require approvals from, or registration with, the relevant PRC governmental authorities. Since a significant amount of our future revenue and cash flow will be denominated in Renminbi, any existing and future restrictions on currency exchange may limit our ability to utilize cash generated in Renminbi to fund our business activities outside of the PRC or pay dividends in foreign currencies to our shareholders, including holders of our securities, and may limit our ability to obtain foreign currency through debt or equity financing for our onshore subsidiaries.

Fluctuations in exchange rates could result in foreign currency exchange losses and could materially reduce the value of your investment.

The value of the Renminbi against the U.S. dollar and other currencies may fluctuate and is affected by, among other things, changes in political and economic conditions and the foreign exchange policy adopted by the PRC government. On July 21, 2005, the PRC government changed its policy of pegging the value of the Renminbi to the U.S. dollar. Following the removal of the U.S. dollar peg, the Renminbi appreciated more than 20% against the U.S. dollar over the following three years. Between July 2008 and June 2010, this appreciation halted and the exchange rate between the Renminbi and the U.S. dollar remained within a narrow band. Since June 2010, the Renminbi has fluctuated against

the U.S. dollar, at times significantly and unpredictably. On November 30, 2015, the Executive Board of the International Monetary Fund, completed the regular five-year review of the basket of currencies that make up the Special Drawing Right (“SDR”), and decided that with effect from October 1, 2016, Renminbi is determined to be a freely usable currency and will be included in the SDR basket as a fifth currency, along with the U.S. dollar, the Euro, the Japanese yen and the British pound. In the fourth quarter of 2016, the Renminbi has depreciated significantly in the backdrop of a surging U.S. dollar and persistent capital outflows of China. With the development of the foreign exchange market and progress towards interest rate liberalization and Renminbi internationalization, the PRC government may in the future announce further changes to the exchange rate system, and we cannot assure you that the Renminbi will not appreciate or depreciate significantly in value against the U.S. dollar in the future. It is difficult to predict how market forces or PRC or U.S. government policy may impact the exchange rate between the Renminbi and the U.S. dollar in the future.

Most of our revenue and costs are denominated in Renminbi. We are a holding company and we rely on dividends paid by our operating subsidiaries in China for our cash needs. Any significant revaluation of Renminbi may materially and adversely affect our results of operations and financial position reported in Renminbi when translated into U.S. dollars, and the value of, and any dividends payable in U.S. dollars. To the extent that we need to convert U.S. dollars we receive from this offering into Renminbi for our operations, appreciation of the Renminbi against the U.S. dollar would have an adverse effect on the Renminbi amount we would receive. Conversely, if we decide to convert our Renminbi into U.S. dollars for the purpose of making payments for dividends on our securities or for other business purposes, appreciation of the U.S. dollar against the Renminbi would have a negative effect on the U.S. dollar amount.

Discontinuation of any of the preferential tax treatments and government subsidies or imposition of any additional taxes and surcharges could adversely affect our financial condition and results of operation.

Our PRC subsidiaries currently benefit from a number of preferential tax treatments. The material preferential tax treatments that has a significant impact on our financial condition and results of operations is that, our subsidiary, Xiamen Suxiang, is entitled to enjoy 15% preferential enterprise income tax from 2024 to 2026, as it has qualified as a “High New Technology Enterprise” on November 8, 2024 under the PRC Enterprises Income Tax Law and related regulations. Under the Enterprise Income Tax Law, corporations in PRC are subject to a 25% corporate income tax (“CIT”) rate on their taxable income after deducting allowable costs. Xiamen Suxiang currently holds a valid High New Technology Enterprise certificate, thereby qualifying for a preferential CIT rate of 15%. However, as Xiamen Suxiang is presently in a loss position with no profits, it has not yet realized actual tax savings from this preferential rate. Should Xiamen Suxiang return to profitability in the future and fails to maintain or renew its High New Technology Enterprise status, its applicable enterprise income tax rate may be increased to 25%, and if Xiamen Suxiang’s High New Technology Enterprise status is revoked by relevant authorities, the tax authorities may recover the High New Enterprise preferential tax treatments that Xiamen Suxiang has benefited from, which could have a material adverse effect on our financial condition and results of operations. We cannot assure you that we will be able to maintain or lower our current effective tax rate in the future.

Dividends paid to our foreign investors and gains on the sale or other disposition of our securities by our foreign investors may become subject to PRC tax.

Under the Enterprise Income Tax Law and its implementation rules issued by the State Council, a 10% PRC withholding tax is applicable to dividends paid to investors that are non-resident enterprises, which do not have an establishment or place of business in the PRC or which have such establishment or place of business but the dividends are not effectively connected with such establishment or place of business, to the extent such dividends are derived from sources within the PRC. Any gain realized on the transfer of securities by such investors is also subject to PRC tax at a current rate of 10%, if such gain is regarded as income derived from sources within the PRC. If we are deemed a PRC resident enterprise, dividends paid on our securities, and any gain realized from the transfer of our securities, would be treated as income derived from sources within the PRC and would as a result be subject to PRC taxation. Furthermore, if we are deemed a PRC resident enterprise, dividends paid to individual investors who are non-PRC residents and any gain realized on the transfer of our securities by such investors may be subject to PRC tax (which in the case of dividends may be withheld at source) at a rate of 20%. Any PRC tax liability may be reduced by an applicable tax treaty or under applicable tax arrangements between jurisdictions. However, if we or any of our subsidiaries established outside China are considered a PRC resident enterprise, it is unclear whether holders of our securities would be able to obtain the benefit of income tax treaties or agreements entered into between China and other countries or areas. If dividends paid to our non-PRC investors, or gains from the transfer of our securities by such investors, are deemed as income derived from sources within the PRC and thus are subject to PRC tax, the value of your investment in our securities may decline significantly.

The ability of U.S. authorities to bring actions for violations of U.S. securities law and regulations against us, our directors, executive officers or the expert named in this prospectus may be limited. Therefore, you may not be afforded the same protection as provided to investors in U.S. domestic companies.

The SEC, the U.S. Department of Justice (“DOJ”), and other U.S. authorities often have substantial difficulties in bringing and enforcing actions against non-U.S. companies such as us, and non-U.S. persons, such as our directors and executive officers in China. Due to jurisdictional limitations, matters of comity and various other factors, the SEC, the DOJ and other U.S. authorities may be limited in their ability to pursue bad actors, including in instances of fraud, in emerging markets such as China. We conduct our operations mainly in China and our assets are mainly located in China. In addition, all of our directors and executive officers reside within China. There are significant legal and other obstacles for U.S. authorities to obtain information needed for investigations or litigation against us or our directors, executive officers or other gatekeepers in case we or any of these individuals engage in fraud or other wrongdoing. In addition, local authorities in China may be constrained in their ability to assist U.S. authorities and overseas investors in connection with legal proceedings. As a result, if we, our directors, executive officers or other gatekeepers commit any securities law violation, fraud or other financial misconduct, the U.S. authorities may not be able to conduct effective investigations or bring and enforce actions against us, our directors, executive officers or other gatekeepers. Therefore, you may not be able to enjoy the same protection provided by various U.S. authorities as it is provided to investors in U.S. domestic companies.

Risks Related to Doing Business in China

Uncertainties with respect to the mainland China legal system, including risks and uncertainties regarding the enforcement of laws, and sudden or unexpected changes in laws and regulations in the PRC with little advance notice could result in a material change in our operations and/or the value of the ordinary shares we are registering for sale.

There are substantial uncertainties regarding the interpretation and application of PRC laws and regulations. The PRC legal system is based on written statutes and their legal interpretations by the Standing Committee of the National People’s Congress. Previous court decisions may be cited for reference but have limited precedential value. Since 1979, the PRC government has been developing a comprehensive system of commercial laws, and considerable progress has been made in introducing laws and regulations dealing with economic matters such as foreign investment, corporate organization and governance, commerce, taxation and trade. However, as these laws and regulations are relatively new, and due to the limited volume of published cases and their non-binding nature, interpretation and enforcement of these laws and regulations involve uncertainties. These laws and regulations are continually subject to future changes, and their official interpretation and enforcement could be unpredictable, with little advance notice which could result in a material change in our operations and/or the value of our Ordinary Shares.

Furthermore, the PRC legal system is based in part on government policies and internal rules, some of which are not published on a timely basis or at all and may have a retroactive effect. As a result, we may not be aware of our violation of any of these policies and rules until sometime after the violation. In addition, any administrative and court proceedings in China may be protracted, resulting in substantial costs and diversion of resources and management attention.

The PRC government may intervene or influence our operations through laws, regulations, rules and government policies at any time, which could result in a material change in our operations and/or the value of the securities we are registering for sale.

Sharewow is a holding company and we conduct our operations through our PRC operating subsidiaries. Our operations are located in the PRC. The PRC government may choose to exercise significant oversight and discretion, and the regulations to which we are subject may change rapidly and with little notice to us or our shareholders. As a result, the application, interpretation, and enforcement of new and existing laws and regulations in China are often uncertain. In addition, these laws and regulations may be interpreted and applied inconsistently by different agencies or authorities, and inconsistently with our current policies and practices. New laws, regulations, and other government directives in China may also be costly to comply with, and such compliance or any associated inquiries or investigations or any other government actions may:

•        delay or impede our development;

•        result in negative publicity or increase our operating costs;

•        require significant management time and attention; and

•        subject us to remedies, administrative penalties and even criminal liabilities that may harm our business, including fines assessed for our current or historical operations, or demands or orders that we modify or even cease our business practices.

The promulgation of new laws or regulations, or the new interpretation of existing laws and regulations, in each case that restrict or otherwise unfavorably impact the ability or manner in which we conduct our business could require us to change certain aspects of our business to ensure compliance, which could decrease demand for our products, increase costs, require us to obtain more licenses, permits, approvals or certificates, or subject us to additional liabilities. To the extent any new or more stringent measures are required to be implemented, our operations could be materially and adversely affected as well as the value of our ordinary shares.

Any actions by the PRC government to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers, such actions could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our ordinary shares to significantly decline or become worthless.

Previous statements by the PRC government have indicated an intent to exert more exert oversight and control over offerings that are conducted overseas and/or foreign investments in China based issuers. On July 10, 2021, CAC issued a revised draft of the Measures for Cybersecurity Review (the “Revised Draft”), which required that, among others, in addition to an “operator of critical information infrastructure” any “data processor” controlling personal information of no less than one million users which seeks to list in a foreign stock exchange should also be subject to cybersecurity review. Pursuant to Article 6 of the Revised Draft, companies holding data of more than one million users must apply for cybersecurity approval when seeking overseas listings because of the risk that such data and personal information could be “affected, controlled, and maliciously exploited by foreign governments.” On January 4, 2022, the CAC, the NDRC, and several other administrations jointly adopted and published the New Measures for Cybersecurity Review (“New Measures”), which came into effect on February 15, 2022 and amended the Revised Draft released on July 10, 2021. According to the New Measures, if an “operator of critical information infrastructure” or “network platform operator” that is in possession of personal data of more than one million users intends to list in a foreign country, it must apply for a cybersecurity review.

On December 24, 2021, the CSRC, together with other relevant PRC authorities issued the Provisions of the State Council on the Administration of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments), and the Measures for the Filing of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) (“Draft Overseas Listing Regulations”). The final version of the Draft Overseas Listing Regulations, or the Trial Measures, was promulgated on February 17, 2023 and became effective on March 31, 2023 and require that a PRC domestic enterprise seeking to issue and list its shares overseas, including direct and indirect issuance and listing, shall complete the filing procedures of and submit the relevant information to CSRC. Where an enterprise whose principal business activities are conducted in the PRC seeks to issue and list its shares in the name of an overseas enterprise on the basis of the equity, assets, income or other similar rights and interests of the relevant PRC domestic enterprise, such activities shall be deemed an indirect overseas issuance and listing under the Trial Measures.

Uncertainties exist, moreover, due to the possibility that laws, regulations, or policies in the PRC could change rapidly in the future. The promulgation of new laws or regulations, or the new interpretation of existing laws and regulations may restrict or otherwise unfavorably impact our ability to conduct business and may require us to change certain aspects of our business to ensure compliance, which could decrease demand for our services, reduce revenues, increase costs, require us to obtain more licenses, permits, approvals or certificates, or subject us to additional liabilities.

In the event that (i) the PRC government expands the categories of industries and companies whose foreign securities offerings are subject to review by the CSRC or the CAC that we are required to obtain such permissions or approvals; or (ii) we inadvertently concluded that relevant permissions or approvals were not required or that we did not receive or maintain relevant permissions or approvals required, any action taken by the PRC government could significantly limit or completely hinder our operations, significantly limit or completely hinder our ability to offer our ordinary shares to investors and cause the value of such ordinary shares to significantly decline or become worthless.

PRC regulatory authorities could regulate our holding company structure.

Sharewow Limited is not an operating company but a Cayman Islands holding company with operations primarily conducted through its subsidiaries in China. Under this holding company structure, investors in our ordinary shares are purchasing equity interests in the Cayman Islands holding company. This holding company structure involves unique risks to investors and investors may never hold equity interests in our operating subsidiaries. Chinese authorities could regulate our structure which, in turn, would likely result in a material change in our operations or the value of our ordinary shares. In such an event, the value of our ordinary shares you invest in could significantly decline or become worthless.

Laws regulating foreign investment in China include the PRC Foreign Investment Law effective from January 1, 2020, and the Implementing Rules of the Foreign Investment Law (the “Implementation Regulations”), effective from January 1, 2020. The PRC Foreign Investment Law specifies that foreign investments shall be conducted in line with the “negative list” to be issued or approved to be issued by the State Council. While we do not operate in an industry that is currently subject to foreign investment restrictions or prohibition in China, it is uncertain whether our industry will be named in an updated “negative list” to be issued in the future. If our industry is added to the “negative list” or if the PRC regulatory authorities otherwise decide to limit foreign ownership in our industry, there could be a risk that we would be unable to do business in China as we are currently structured. If any new laws and/or regulations on foreign investments in China are promulgated and implemented, such changes could have a significant impact on our current corporate structure, which in turn could have a material adverse impact on our business and operations, our ability to raise capital and the market price of our ordinary shares. In such event, despite our efforts to restructure to comply with the then applicable PRC laws and regulations in order to continue our operations in China, we may experience material changes in our business and results of operations, our attempts may prove to be futile due to factors beyond our control, and the value of the ordinary shares you invest in may significantly decline or become worthless.

The PRC government’s regulation over our business operations could result in adverse changes in our operations and the value of our ordinary shares.

We conduct our business through our subsidiaries in China. Our operations in China are governed by PRC laws and regulations. The PRC government may regulate our operations as part of its efforts to enforce PRC law, which could result in adverse changes in our operations, and our ordinary shares may decline in value or become worthless. The PRC government has recently published new policies that significantly affected certain industries and we cannot rule out the possibility that it will in the future release regulations or policies that directly or indirectly affect our industry or require us to seek additional permission to continue our operations. Therefore, investors of our company and our business may be influenced from actions taken by the PRC government affecting our business.

Any failure by us to comply with the PRC legal system could adversely affect us.

The PRC legal system is a civil law system based on written statutes, where prior court decisions have limited precedential value.

We are subject to a variety of laws and regulations in the PRC regarding our capital raising activities, which may be continuously evolving and under development. Rules and regulations in China are subject to changes by the relevant authorities. Sometimes such authorities will publish drafts of the revisions to existing rules and regulations for public comments and consultations before enacting such revisions. But such consultations are done on case-by-case basis and we otherwise lack public channels to learn the extents of the revisions beforehand, in which case we might have limited time to ensure timely compliance upon the enactment of such revisions. For instance, on February 17, 2023, the China Securities Regulatory Commission (“CSRC”) announced the Notice on Filing Management Arrangements for Overseas Listings of Domestic Enterprises, and released a set of new regulations which consists of the Trial Measures, and five supporting guidelines which came into effect on March 31, 2023. Under Trial Measures, a filing-based regulatory system will also be applied to “indirect overseas offering and listing” of PRC domestic companies, and those PRC domestic companies that have submitted a valid application for an overseas offering and listing but have not received consent from the overseas regulator or overseas stock exchange before March 31, 2023, shall complete the filing with CSRC before the completion of this offering.

From time to time, we may have to resort to administrative and court proceedings to enforce our legal rights. However, since we cannot decide or predict the outcome of a judicial or administrative proceeding, our ability to enforce the contracts we have entered into may be impeded and our business and results of operations may be adversely affected.

We may not always be aware of any potential violation of government policies and rules that may not be made available to us in a timely manner. Such unpredictability towards our contractual, property (including intellectual property) and procedural rights could adversely affect our business and impede our ability to continue our operations.

You may experience difficulties in effecting service of legal process, enforcing foreign judgments, or bringing actions in China against us or our PRC subsidiaries based on foreign laws. It may also be difficult for you or overseas regulators to conduct investigations or collect evidence within China.

We are an exempted company incorporated under the laws of the Cayman Islands, and we conduct most of our operations in China and most of our assets are located in China. In addition, all of our current directors and officers are nationals or residents of the PRC and all or a substantial portion of their assets are located outside the U.S. As a result, it may be time-consuming and costly for you to effect service of process upon us or those persons inside mainland China, compared to doing so in your home country against a domestic defendant. In addition, there is uncertainty as to whether the courts of the Cayman Islands or the PRC would recognize or enforce judgments of U.S. courts against us, or such persons predicated upon the civil liability provisions of U.S. securities laws or those of any U.S. state.

The recognition and enforcement of foreign judgments are provided for under the PRC Civil Procedures Law. PRC courts may recognize and enforce foreign judgments in accordance with the requirements of the PRC Civil Procedures Law based either on treaties between China and the country where the judgment is made or on principles of reciprocity between jurisdictions. China does not have any treaties or other forms of written arrangement with the U.S. that provide for the reciprocal recognition and enforcement of foreign judgments. In addition, according to the PRC Civil Procedures Law, the PRC courts will not enforce a foreign judgment against us or our directors and officers if they decide that the judgment violates the basic principles of PRC laws or national sovereignty, security, or public interest. As a result, it is uncertain whether and on what basis a PRC court would enforce a judgment rendered by a court in the U.S.

It may also be difficult for you or overseas regulators to conduct investigations or collect evidence within China. Although the authorities in China may establish a regulatory cooperation mechanism with its counterparts of another country or region to monitor and oversee cross-border securities activities, such regulatory cooperation with the securities regulatory authorities in the U.S. may not be efficient in the absence of a practical cooperation mechanism. Furthermore, according to Article 177 of the PRC Securities Law (“Article 177”) which became effective in March 2020, no overseas securities regulator is allowed to directly conduct investigations or evidence collection activities within the territory of the PRC. Article 177 further provides that Chinese entities and individuals are not allowed to provide documents or materials related to securities business activities to foreign agencies without prior consent from the securities regulatory authority of the PRC State Council and the competent departments of the PRC State Council. Accordingly, without governmental approval in China, no entity or individual in mainland China may provide documents and information relating to securities business activities to overseas regulators when it is under direct investigation or evidence discovery conducted by overseas regulators, which could present significant legal and other obstacles to obtaining information needed for investigations and litigation conducted outside of mainland China.

The continued U.S. regulatory and legislative focus, including the enactment of the HFCAA, may adversely affect the market price of our ordinary shares and may eventually require us to delist our securities from the U.S. markets.

Under U.S. securities laws, publicly listed companies are required to have their financial statements audited by independent public accounting firms registered with the Public Company Accounting Oversight Board (the “PCAOB”). Under the Sarbanes-Oxley Act, the PCAOB is required to inspect the PCAOB-registered accounting firms to assess compliance with auditing standards and bring enforcement actions for non-compliance with such standards. If requested by the PCAOB or the SEC, PCAOB-registered accounting firms are required to provide the audit work papers and other related information for inspection. However, Article 177 of the revised PRC Securities

Law prohibits, without the approval of the securities regulatory authority in China, (i) foreign securities regulators from engaging in any inspection activities within China and (ii) anyone from providing any documents or materials relating to capital markets activities to foreign parties. To seek a framework for cooperation, in May 2013, the PCAOB entered into a Memorandum of Understanding on Enforcement Cooperation (“MOU”), with the CSRC and the Ministry of Finance (“MoF”), which establishes a cooperative framework among the parties for the production and exchange of audit documents relevant to investigations undertaken by the PCAOB, the CSRC, or the MoF in the United States and the PRC, respectively. Despite the MOU, the Chairmen of each of the SEC and the PCAOB issued a joint statement in December 2018 alleging continuing, significant issues relating to the ability of the PCAOB to inspect the audit work papers and practices of PCAOB-registered accounting firms in China with respect to their audit work of U.S.-listed companies with operations in China. The SEC and the PCAOB reiterated these allegations and highlighted such risks in another joint statement in April 2020.

As part of the continued regulatory scrutiny in the United States on access to audit and other information currently protected by laws in China, in December 2020, the U.S. Congress passed the Holding Foreign Companies Accountable Act (the “HFCAA”), which was passed by the U.S. Senate in May 2020. The HFCAA was signed into law by the President in December 2020. The HFCAA amended the Sarbanes-Oxley Act to require the SEC to determine each company that is required to file periodic reports with the SEC that has retained an accounting firm: (i) that is located in a foreign jurisdiction and (ii) whom the PCAOB is unable to inspect or investigate due to the position taken by an authority in the foreign jurisdiction (as determined by the PCAOB). If the SEC determines that the PCAOB has been unable to inspect or investigate such accounting firm for three consecutive years, it will prohibit such company from trading its securities on a U.S. securities exchange or in any “over-the-counter” exchange. In addition, in August 2020, the President’s Working Group on Financial Markets (the “ PWG”), released a report recommending that the SEC take certain steps, including adopting enhanced listing standards on U.S. stock exchanges, to protect U.S. investors from the perceived risks of Chinese companies. This would require, as a condition to initial and continued listing on a U.S. stock exchange, PCAOB access to work papers of the principal audit firm for the audit of the listed company.

On September 22, 2021, the PCAOB adopted PCAOB Rule 6100, Board Determinations Under the HFCAA, which was approved by the SEC on November 4, 2021. The PCAOB Rule 6100 establishes a framework for the PCAOB to make determinations as to whether PCAOB is unable to inspect an audit firm in a foreign jurisdiction, or a PCAOB-Identified Firm, including the timing, factors, bases, publication and revocation or modification of such determinations, and such determinations will be made on a jurisdiction-wide basis in a consistent manner applicable to all firms headquartered in the jurisdiction. On December 16, 2021, pursuant to PCAOB Rule 6100, PCAOB issued a report setting forth the PCAOB-registered public accounting firms headquartered in Mainland China and Hong Kong that it is unable to inspect or investigate completely.

On December 2, 2021, the SEC adopted amendments to finalize the interim final rules adopted earlier on March 24, 2021 relating to the implementation of certain disclosure and documentation requirements of the HFCAA, or final amendments. Pursuant to the final amendments, promptly after filing an annual report, the SEC will evaluate whether the annual report contains an audit report signed by a PCAOB-Identified Firm. Once a registrant has been so identified, the SEC will provisionally identify such issuer as a “Commission-Identified Issuer” on its website. For a period of 15 business days after the provisional identification, a registrant may contact the SEC if it believes it has been incorrectly identified and may provide evidence supporting such claims. After reviewing the information, the registrant will be notified whether the SEC will conclusively identify the registrant as a “Commission-Identified Issuer.” The SEC will identify registrants pursuant to the HFCAA based on the PCAOB’s determination and on registrants’ annual reports for fiscal years beginning after December 18, 2020. If we are conclusively identified as a “Commission-Identified Issuer” for three consecutive years, the SEC will impose an initial trading prohibition on us as soon as practicable. If the SEC ends the initial trading prohibition and, thereafter, we are again determined to be a “Commission-Identified Issuer,” the SEC will impose a subsequent trading prohibition on us for a minimum of five years. To end an initial or subsequent trading prohibition, we must certify that we have retained or will retain a registered public accounting firm that the PCAOB has determined it is able to inspect or investigate. To make that certification, we must file financial statements that include an audit report signed by such a registered public accounting firm.

Furthermore, on December 29, 2022, the Consolidated Appropriation Act, 2023 was enacted. Among other things, it amended the HFCAA to require the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three.

On August 26, 2022, the PCAOB signed a Statement of Protocol with the CSRC and the MoF which contains provisions that, if abided by, would give the PCAOB access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong completely. On December 15, 2022, the PCAOB announced that it was able to conduct inspections and investigations completely of PCAOB registered public accounting firms headquartered in mainland China and Hong Kong in 2022.The PCAOB vacated its previous determinations accordingly.

However, whether the PCAOB will continue to conduct inspections and investigations completely to its satisfaction of PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong is subject to uncertainty and depends on a number of factors out of our, and our auditor’s, control, including positions taken by authorities of the PRC and the PCAOB. The PCAOB is expected to continue to demand complete access to inspections and investigations against accounting firms headquartered in mainland China and Hong Kong in the future and states that it has already made plans to resume regular inspections in early 2023 and beyond. The PCAOB is required under the HFCAA to make its determination on an annual basis with regards to its ability to inspect and investigate completely accounting firms based in mainland China and Hong Kong. The possibility of being a “Commission-Identified Issuer” and risk of delisting could continue to adversely affect the trading price of our securities. If the PCAOB determines in the future that it no longer has full access to inspect and investigate accounting firms headquartered in mainland China and Hong Kong and we continue to use such accounting firm to conduct audit work, we would be identified as a “Commission-Identified Issuer” under the HFCAA following the filing of the annual report for the relevant fiscal year, and if we were so identified for two consecutive years, trading in our securities on U.S. markets would be prohibited. Such a prohibition would substantially impair your ability to sell or purchase the shares when you wish to do so. The market price of the shares could be materially and adversely affected as a result of anticipated negative impacts of these actions upon, as well as negative investor sentiment towards, companies with significant operations in China that are listed in the United States, regardless of whether these actions are implemented and regardless of our actual operating performance. Also, such a prohibition would significantly affect our ability to raise capital on terms acceptable to us, or at all, which would have a material adverse impact on our business, financial condition and prospects.

We are subject to various environmental, safety and health regulations that may subject us to costs, liabilities and other obligations, which could have a material adverse effect on our business, results of operations and financial condition.

The production in our PRC facility is subject to various environmental, safety and health and other regulations that may subject us to costs, liabilities and other obligations which could have a material adverse effect on our business. The applicable requirements under these laws are subject to amendment, to the imposition of new or additional requirements and to changing interpretations of agencies or courts. We could incur material expenditures to comply with new or existing regulations, including fines and penalties and increased costs of our operations. Additionally, future laws, ordinances, regulations or regulatory guidelines could give rise to additional compliance or remediation costs that could have a material adverse effect on our business, results of operations and financial condition.

The production in our PRC facility is also governed by PRC laws relating to workplace safety and worker health. We have taken, and will continue to take, steps to comply with these laws. If we fail to comply with present or future environmental or safety regulations, we could be subject to future liabilities. However, we cannot ensure that complying with these environmental or health and safety laws and requirements will not adversely affect our business, results of operations and financial condition.

Complying with evolving laws and regulations regarding cybersecurity, information security, privacy and data protection and other related laws and requirements may entail significant expenses which may have an adverse effect on our business, financial conditions and results of operations.

The PRC regulatory and enforcement regime with regard to data security and data protection is evolving. All these laws and regulations may result in additional expenses to us and subject us to negative publicity which could harm our reputation and negatively affect the trading price of our ordinary shares. There are also uncertainties with respect to how these laws will be implemented in practice. PRC regulators have been increasingly focused on regulation in the areas of data security and data protection. We expect that these areas will receive greater attention and focus from regulators, as well as attract continued or greater public scrutiny and attention going forward, which

could increase our compliance costs and subject us to heightened risks and challenges associated with data security and protection. We cannot assure you that the measures we have taken are always sufficient and effective. If we are unable to manage these risks, we could become subject to penalties, fines, suspension of business and revocation of required licenses, and our reputation and results of operations could be materially and adversely affected.

Laws and regulations regarding cybersecurity review, particularly for companies seeking to list on a foreign exchange.

On December 28, 2021, 13 governmental departments of the PRC, including the CAC, jointly promulgated the Cybersecurity Review Measures, which became effective on February 15, 2022. The Cybersecurity Review Measures provide that, in addition to critical information infrastructure operators (“CIIOs”) that intend to purchase Internet products and services, online platform operators engaging in data processing activities that affect or may affect national security must be subject to cybersecurity review by the Cybersecurity Review Office of the PRC. According to the Cybersecurity Review Measures, a cybersecurity review assesses potential national security risks that may be brought about by any procurement, data processing, or overseas listing. The Cybersecurity Review Measures require that an online platform operator which possesses the personal information of more than one million users must apply for a cybersecurity review by the CAC if it intends to be listed in foreign country. The relevant governmental authorities may also initiate cybersecurity review if such governmental authorities consider relevant network products or services and data processing affect or may affect national security.

As of the date of this prospectus, we had not received any notice from any authorities identifying our PRC subsidiaries as CIIOs or requiring us to go through cybersecurity review by the CAC. Additionally, none of our PRC subsidiaries is an “online platform operators” processing personal information of more than one million users. Therefore, it is the opinion of our PRC counsel, Han Kun PRC, that neither the operations of our PRC subsidiaries, nor our listing are expected to be affected, and that we are not subject to cybersecurity review by the CAC under the Cybersecurity Review Measures. There remains uncertainty, however, as to how the Cybersecurity Review Measures will be interpreted or implemented and whether the PRC regulatory agencies, including the CAC, may adopt new laws, regulations, rules, or detailed implementation and interpretation related to the Cybersecurity Review Measures. If any such new laws, regulations, rules, or implementation and interpretation come into effect, we expect to take all reasonable measures and actions to comply and to minimize the adverse effect of such laws on us. We cannot guarantee, however, that our PRC subsidiaries will not be subject to cybersecurity review in the future. During such reviews, our PRC subsidiaries may be required to suspend their operations or experience disruptions to their operations. Cybersecurity review could also result in negative publicity with respect to our Company and diversion of our managerial and financial resources, which could materially and adversely affect our business, financial conditions, and results of operations.

Laws and regulations regarding cybersecurity and information security.

According to the PRC National Security Law, the State shall establish institutions and mechanisms for national security review and regulation, conduct national security review on certain matters which affect or may affect the national security, such as key technologies and IT products and services. According to the Cybersecurity Law and relevant regulations, network constructors, network operators and service providers that provide services via network are obligated to take technical and other necessary measures to ensure the security and stable operation of network, maintain the integrity, confidentiality and availability of network data, and furthermore provide technical assistance and support in accordance with the law for public security and national security authorities to protect national security or assist with criminal investigations. In addition, the Cybersecurity Law provides that personal information and important data collected and generated by CIIOs in the course of their operations in the PRC should be stored in the PRC, and the law imposes regulation and security obligations on CIIOs. On March 28, 2025, the CAC proposed a series of draft amendments to the Cybersecurity Law, which impose several legal liabilities for certain violations. Such draft amendments were released for soliciting public comments and its final form, interpretation and implementation remain substantially uncertain.

On June 10, 2021, the Standing Committee of the National People’s Congress of China (“SCNPC”) promulgated the Data Security Law, which came into effect on September 1, 2021. The Data Security Law provides for data security and privacy obligations on entities and individuals carrying out data processing activities, introduces a data classification and hierarchical protection system based on the importance of data in economic and social development, as well as the degree of harm it will cause to national security, public interests, or legitimate

rights and interests of individuals or organizations when such data is tampered with, destroyed, leaked, or illegally acquired or used, provides for a national security review procedure for those data activities which may affect national security and imposes export restrictions on certain data and information. The Data Security Law provides that “data” refers to any recording of information by electronic or other means. Data processing includes the collection, storage, use, processing, transmission, availability and disclosure of data, etc.

Laws and regulations regarding the security assessment could adversely affect our business, financial conditions, and results of operations.

On July 7, 2022, the CAC promulgated the Data Outbound Transfer Security Assessment Measures (the “Security Assessment Measures”), which took effect on September 1, 2022. Pursuant to the Security Assessment Measures, a data processor shall apply to competent authorities for security assessment prior to transferring any data abroad if the transfer involves (i) important data; (ii) personal information transferred overseas by a CIIO and a data processor that has processed personal information of more than one million individuals; (iii) personal information transferred overseas by a data processor who has already provided personal information of 100,000 persons or sensitive personal information of 10,000 persons overseas since January 1 of the previous year; or (iv) other circumstances as requested by the CAC. Furthermore, on March 22, 2024, the CAC released the Provisions on Promoting and Regulating Cross-border Data Flows, which set forth the circumstances exempted from performing the security assessment or filing procedures for cross-border data transfer and further clarify the thresholds and scenarios for data processors to go through these procedures as stipulated under the Security Assessment Measures. As of the date of this prospectus, we did not transfer any users’ personal information or important data outside of China.

The CAC together with other regulators has also issued regulations related to artificial intelligence services and algorithmic services such as the Administrative Provisions on Internet Information Service Algorithm Recommendation, the Administrative Provisions for In-depth Integration as an Internet Information Service, and the Interim Measures for the Administration of Generative Artificial Intelligence Services. The above provisions impose algorithm filing and security assessment requirements for specific services, and there still remain uncertainties as to whether or to what extent our business would be captured by the aforementioned algorithm filing and security assessment requirements. Any failure to comply with such filing or assessment requirements (to the extent that the relevant regulators deem that such regulatory procedures apply to us) or any other non-compliance or perceived noncompliance with the above provisions may subject us to penalties and liabilities including, among others, warnings, public denouncement, fines, rectification orders, suspension of the provision of relevant services, and even criminal liabilities.

However, as there are still regulatory uncertainties in this regard, we cannot assure you that we will be able to comply with new laws and regulations in all respects, and we may be ordered to rectify, suspend or terminate any actions or services that are deemed illegal by the regulatory authorities and become subject to material penalties, which may materially harm our business, financial condition, results of operations and prospects.

These promulgated laws and regulations reflect PRC government’s recent efforts to strengthen the legal protection for the national network security, the security of key information infrastructure and the security of personal information protection. Compliance with these laws and regulations will affect how we design, market and sell our products, how we operate our business, how our customers process and share data, how we process and use data, and how we transfer personal data from one jurisdiction to another, which could negatively impact demand for our solutions.

We may incur substantial costs to comply with such laws and regulations, to meet the demands of our customers relating to their own compliance with applicable laws and regulations, and to establish and maintain internal compliance policies.

Moreover, different regulatory bodies in China, including among others, the Ministry of Industry and Information Technology (“MIIT”), the CAC and the Ministry of Public Security have enforced laws and regulations regarding cybersecurity, information security, privacy and data protection with various standards and applications.

We have established rigorous and comprehensive policies and other documentation for the collection, processing, sharing, disclosure authorization and other aspects of data use and privacy and taken necessary measures to comply with the applicable laws and regulations regarding cybersecurity, information security, privacy and

data protection. However, we cannot guarantee the effectiveness of these policies and measures undertaken by us, our employees, franchisees or other business partners. We may be from time to time required to rectify or further improve our measures regarding cybersecurity, information security, privacy and data protection. Any failure or perceived failure by us to comply with all applicable laws and regulations regarding cybersecurity, information security, privacy and data protection, or any failure or perceived failure of our business partners to do so, or any failure or perceived failure of our employees to comply with our internal control measures, may result in negative publicity and legal proceedings or regulatory actions against us, and could result in fines, revocation of licenses, suspension of relevant operations or other legal or administrative penalties, which may in turn damage our reputation, discourage our current and potential consumers and subject us to fines and damages, which could have a material adverse effect on our business and results of operations. In addition, it is possible that we may become subject to additional or new laws and regulations regarding cybersecurity, information security, privacy and data protection in other jurisdictions if we further extend our business outside of the PRC in the future, which may result in additional expenses to us and subject us to potential liability and negative publicity. We expect that these areas will receive greater attention and focus from regulators, and attract continued or greater public scrutiny and attention going forward, which could increase our compliance costs and subject us to heightened risks and challenges regarding cybersecurity, information security, privacy and data protection. If we are unable to manage these risks, we could become subject to penalties, fines, suspension of business and revocation of required licenses, and our reputation and results of operations could be materially and adversely affected.

Increases in labor costs and enforcement of stricter labor laws and regulations in China and our additional payments of statutory employee benefits may adversely affect our business and profitability.

The average wage in China has increased in recent years and is expected to continue to grow. The average wage level for our employees has also increased in recent years. We expect that our labor costs, including wages and employee benefits, will continue to increase. Unless we are able to pass on these increased labor costs to our customers and end users, our profitability and results of operations may be materially and adversely affected. In addition, we have been subject to strict regulatory requirements in terms of entering into labor contracts with our employees and paying various statutory employee benefits, including pensions, housing funds, medical insurance, work related injury insurance, unemployment insurance and maternity insurance to designated government agencies for the benefit of our employees.

Pursuant to the PRC Labor Contract Law and its implementation rules, employers are subject to strict requirements in terms of signing labor contracts, paying remuneration, determining the term of employee’s probation and unilaterally terminating labor contracts. In the event that we decide to terminate some of our employees or otherwise change our employment or labor practices, the PRC Labor Contract Law and its implementation rules may limit our ability to effect those changes in a desirable or cost-effective manner, which could adversely affect our business and results of operations. As the interpretation and implementation of labor-related laws and regulations are still evolving, we cannot assure you that our current employment practices do not and will not violate labor-related laws and regulations in China, which may subject us to labor disputes or government investigations. In addition, we may incur additional expenses in order to comply with such laws and regulations, which may adversely affect our business and profitability.

PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from using the proceeds of our offshore financing to make loans or additional capital contributions to our PRC subsidiaries, which could adversely affect our liquidity and our ability to fund and expand our business.

In utilizing the proceeds of this offering, we, as an offshore holding company, are permitted under PRC laws and regulations to provide funding to our PRC subsidiaries, which are treated as foreign-invested enterprises under PRC laws, through loans or capital contributions. However, loans by us to our PRC subsidiaries to finance their activities cannot exceed statutory limits and must be registered with the local counterpart of State Administration of Foreign Exchange (“SAFE”) and capital contributions by us to our PRC subsidiaries are subject to registration with the State Administration for Market Regulation (“SAMR”) or its local branch, reporting of foreign investment information with the PRC Ministry of Commerce, or registration with other governmental authorities in China.

SAFE promulgated the Notice of the State Administration of Foreign Exchange on Reforming the Administration of Foreign Exchange Settlement of Capital of Foreign-invested Enterprises (the “SAFE Circular 19”), effective on June 1, 2015, and last amended on March 23, 2023. According to SAFE Circular 19, the flow and use of the RMB capital converted from foreign currency-denominated registered capital of a foreign-invested company is regulated such that RMB capital may not be used for the issuance of RMB entrusted loans, the repayment of inter-enterprise loans or the repayment of banks loans that have been transferred to a third-party. Although SAFE Circular 19 allows RMB capital converted from foreign currency-denominated registered capital of a foreign-invested enterprise to be used for equity investments within the PRC, it also reiterates the principle that RMB converted from the foreign currency-denominated capital of a foreign-invested company may not be directly or indirectly used for purposes beyond its business scope. SAFE promulgated the Notice of the State Administration of Foreign Exchange on Reforming and Standardizing the Foreign Exchange Settlement Management Policy of Capital Account (the “SAFE Circular 16”), effective on June 9, 2016, which reiterates some of the rules set forth in SAFE Circular 19, but changes the prohibition against using RMB capital converted from foreign currency-denominated registered capital of a foreign-invested company to issue RMB entrusted loans to a prohibition against using such capital to issue loans to non-associated enterprises. Violations of SAFE Circular 19 and SAFE Circular 16 could result in administrative penalties. SAFE Circular 19 and SAFE Circular 16 may significantly limit our ability to transfer any foreign currency we hold, including the net proceeds from this offering, to our PRC subsidiaries, which may adversely affect our liquidity and our ability to fund and expand our business in the PRC.

On October 23, 2019, SAFE promulgated the Notice on Further Promoting the Convenience of Cross-border Trade and Investment (the “SAFE Circular 28”), which was further amended on December 4, 2023, and permits non-investment foreign-invested enterprises to use their capital funds to make equity investments in China, with genuine investment projects and in compliance with effective foreign investment restrictions and other applicable laws.

In light of the various requirements imposed by PRC regulations on loans to, and direct investment in, PRC entities by offshore holding companies, we cannot assure you that we will be able to complete the necessary government registrations or obtain the necessary government approvals on a timely basis, if at all, with respect to future loans or future capital contributions by us to our PRC subsidiaries. As a result, uncertainties exist as to our ability to provide prompt financial support to our PRC subsidiaries when needed. If we fail to complete such registrations or obtain such approvals, our ability to use foreign currency, including the proceeds we received from this offering, and to capitalize or otherwise fund our PRC operations may be negatively affected, which could materially and adversely affect our liquidity and our ability to fund and expand our business.

PRC regulations relating to investments in offshore companies by PRC residents may subject our PRC-resident beneficial owners or our PRC subsidiaries to liability or penalties, limit our ability to inject capital into our PRC subsidiaries or limit our PRC subsidiaries’ ability to increase their registered capital or distribute profits.

PRC residents are subject to restrictions and filing requirements when investing in offshore companies. The SAFE promulgated the Circular on Relevant Issues Concerning Foreign Exchange Control on Domestic Residents’ Offshore Investment and Financing and Roundtrip Investment through Special Purpose Vehicles (“SAFE Circular 37”), on July 4, 2014. SAFE Circular 37 requires PRC residents to register with local branches of the SAFE in connection with their direct establishment or indirect control of an offshore entity, for the purpose of overseas investment and financing, with such PRC residents’ legally owned assets or equity interests in domestic enterprises or offshore assets or interests, referred to in SAFE Circular 37 as a “special purpose vehicle.” Pursuant to SAFE Circular 37, “control” refers to the act through which a PRC resident obtains the right to carry out business operations of, to gain proceeds from or to make decisions on a special purpose vehicle by means of, among others, shareholding entrustment arrangement. SAFE Circular 37 further requires amendment to the registration in the event of any significant changes with respect to the special purpose vehicle, such as change of shareholders of the special purpose vehicles, increase or decrease of capital contributed by PRC individuals, share transfer or exchange, merger, division or other material event. In the event that a PRC shareholder holding interests in a special purpose vehicle fails to fulfill the required SAFE registration, the PRC subsidiaries of that special purpose vehicle may be prohibited from making profit distributions to the offshore parent and from carrying out subsequent cross-border foreign exchange activities, and the special purpose vehicle may be restricted in its ability to contribute additional capital into its PRC subsidiary. Moreover, failure to comply with the various SAFE registration requirements described above could result in liability under PRC law for evasion of foreign exchange controls. According to the Notice on Further Simplifying and Improving Policies for the Foreign Exchange Administration of Direct Investment released

on February 13, 2015 by the SAFE, local banks will examine and handle foreign exchange registration for overseas direct investment, including the initial foreign exchange registration and amendment registration, under SAFE Circular 37 from June 1, 2015.

We may not be aware of the identities of all of our beneficial owners who are PRC residents. We do not have control over our beneficial owners and there can be no assurance that all of our PRC-resident beneficial owners will comply with SAFE Circular 37 and subsequent implementation rules, and there is no assurance that the registration under SAFE Circular 37 and any amendment will be completed in a timely manner, or will be completed at all. The failure of our beneficial owners who are PRC residents to register or amend their foreign exchange registrations in a timely manner pursuant to SAFE Circular 37 and subsequent implementation rules, or the failure of future beneficial owners of our company who are PRC residents to comply with the registration procedures set forth in SAFE Circular 37 and subsequent implementation rules, may subject such beneficial owners or our PRC subsidiaries to fines and legal sanctions. Failure to register or comply with relevant requirements may also limit our ability to contribute additional capital to our PRC subsidiaries and limit our PRC subsidiaries’ ability to distribute dividends to our company. These risks may have a material adverse effect on our business, financial condition and results of operations.

We and our shareholders face uncertainty with respect to indirect transfers of equity interests in or other assets attributed to PRC resident enterprises by non-PRC resident companies, or immovable properties located in China owned by non-Chinese companies.

On February 3, 2015, the State Administration of Taxation (“SAT”) issued the Public Notice Regarding Certain Corporate Income Tax Matters on Indirect Transfer of Properties by Non-Tax Resident Enterprises (“SAT Bulletin 7”), which provided comprehensive guidelines relating to, and also provided the PRC tax authorities’ scrutiny over, indirect transfers by a non-resident enterprise of PRC taxable assets. SAT Bulletin 7 redefines the applicable scope of the subject of the indirect share transfers to PRC taxable assets which includes equity investments in PRC resident enterprises, assets of a Chinese establishment and immovable properties in China. In addition, SAT Bulletin 7 has introduced safe harbors for internal group restructurings and the purchase and sale of equity through a public securities market. SAT Bulletin 7 also imposes obligations on both the foreign transferor and transferee (or other person who is obligated to pay for the transfer) in relation to PRC taxable assets. SAT Bulletin 7 does not apply to transactions of sale of shares by investors through a public stock exchange where such shares were acquired from a transaction through a public stock exchange.

On October 17, 2017, the SAT issued the Announcement of the State Administration of Taxation on Issues Concerning the Withholding of Non-resident Enterprise Income Tax at Source (“SAT Bulletin 37”), which came into effect on December 1, 2017, and was most recently amended on June 15, 2018. SAT Bulletin 37 amends certain provisions in SAT Bulletin 7, but does not touch upon other provisions of SAT Bulletin 7, which remain in full force. The SAT Bulletin 37 further clarifies the practice and procedure of the withholding of non-resident enterprise income tax.

Where a non-resident enterprise transfers taxable assets in China indirectly by disposing of the equity interests of an overseas holding company, which is an Indirect Transfer, the non-resident enterprise as either transferor or transferee, or the PRC entity whose equity is transferred, may report such Indirect Transfer to the relevant tax authority. Using a “substance over form” principle, the PRC tax authority may disregard the existence of the overseas holding company if it lacks a reasonable commercial purpose and was established for the purpose of reducing, avoiding or deferring PRC tax. When determining whether there is a “reasonable commercial purpose” of the transaction arrangement, features to be taken into consideration include, without limitation: whether the main value of the equity interest of the relevant offshore enterprise derives directly or indirectly from PRC taxable assets; whether the assets of the relevant offshore enterprise mainly consists of direct or indirect investment in China or if its income mainly derives directly or indirectly from China; whether the offshore enterprise and its subsidiaries directly or indirectly holding PRC taxable assets have real commercial nature which is evidenced by their actual function and risk exposure; the duration of the existence of the shareholders, business model and the organizational structure; the income tax payable abroad on the income from the indirect transfer of PRC taxable assets; the replicability of the transaction by direct transfer of PRC taxable assets; and the applicable tax treaties or similar arrangements to such indirect transfer. As a result, gains derived from such Indirect Transfer may be subject to PRC enterprise income tax, and the transferee or other person who is obligated to pay for the transfer is obligated to withhold the applicable taxes, currently at a rate of 10% for the transfer of equity interests in a PRC resident enterprise, subject to available

preferential tax treatment under applicable tax treaties or similar arrangements. Both the transferor and the transferee may be subject to penalties under PRC tax laws if the transferee fails to withhold the taxes and the transferor fails to pay the taxes.

We face uncertainties as to the reporting and other implications of certain past and future transactions where PRC taxable assets are involved, such as offshore restructuring and sales of the shares in our company or our offshore subsidiaries and investments. Our company may be subject to filing obligations or taxed if our company is transferor in such transactions, and may be subject to withholding obligations if our company is transferee in such transactions, under SAT Bulletin 7 and/or SAT Bulletin 37. For transfers of shares in our company by investors who are non-PRC resident enterprises, our PRC subsidiaries may be requested to assist in the filing under SAT Bulletin 7 and/or SAT Bulletin 37. As a result, we may be required to expend valuable resources to comply with SAT Bulletin 7 and/or SAT Bulletin 37 or to request the relevant transferors from whom we purchase taxable assets to comply with these bulletins, or to establish that our company should not be taxed under these bulletins, which may have a material adverse effect on our financial condition and results of operations.

We may rely on dividends and other distributions on equity paid by our subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our PRC subsidiaries to make payments to us could have an adverse effect on our ability to conduct our business. To the extent our cash is in mainland China or Hong Kong or held in our subsidiaries in mainland China or Hong Kong, the funds may not be available to fund operations or for other use outside of mainland China and Hong Kong due to interventions in, or the imposition of restrictions and limitations on, the ability of us or our subsidiaries by the PRC government to transfer cash.

Sharewow Limited is a holding company incorporated in the Cayman Islands. We rely on dividends and other distributions on equity paid by our subsidiaries for our cash and financing requirements, including the funds necessary to pay dividends and other cash distributions to our shareholders and service any debt we may incur outside of the PRC. Current mainland China regulations permit our mainland China subsidiaries to pay dividends to us out of their accumulated after-tax profits upon satisfaction of relevant statutory conditions and procedures, if any, determined in accordance with Chinese accounting standards and regulations. In addition, each of our PRC subsidiaries is required to set aside at least 10% of its after-tax profits each year, if any, to fund certain reserve funds until the total amount set aside reaches 50% of its registered capital. These reserves, together with the registered capital, are not distributable as cash dividends. Additionally, if our PRC subsidiaries incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends or make other distributions to us.

Any limitation on the ability of our PRC subsidiaries to distribute dividends or other payments to their respective shareholders could adversely limit our ability to grow, make investments or acquisitions that could be beneficial to our businesses, pay dividends or otherwise fund and conduct our business.

In addition, the Enterprise Income Tax Law of the PRC (the “EIT Law”) and its implementation rules provide that a withholding tax rate of up to 10% will be applicable to dividends payable by Chinese companies to non-PRC-resident enterprises unless otherwise exempted or reduced according to treaties or arrangements between the PRC central government and governments of other countries or regions where the non-PRC resident enterprises are tax resident.

If we are classified as a PRC resident enterprise for PRC enterprise income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders.

Under the EIT Law and its implementing rules, enterprises established under the laws of jurisdictions outside of China with “de facto management bodies” located in China may be considered PRC tax resident enterprises for tax purposes and may be subject to the PRC enterprise income tax at the rate of 25% on their global income. “De facto management body” refers to a managing body that exercises substantial and overall management and control over the production and operations, personnel, accounting and assets of an enterprise. The SAT issued the Notice Regarding the Determination of Chinese-Controlled Offshore-Incorporated Enterprises as PRC Tax Resident Enterprises on the Basis of De Facto Management Bodies (“Circular 82”), on April 22, 2009, which was most recently amended on December 29, 2017. Circular 82 provides certain specific criteria for determining whether the

“de facto management body” of a Chinese-controlled offshore-incorporated enterprise is located in China. Although Circular 82 only applies to offshore enterprises controlled by PRC enterprises or PRC enterprise groups, not those controlled by foreign enterprises or individuals, the determining criteria set forth in Circular 82 may reflect the State Administration of Taxation’s general position on how the “de facto management body” test should be applied in determining the tax resident status of offshore enterprises, regardless of whether they are controlled by PRC enterprises or PRC enterprise groups. According to Circular 82, an offshore incorporated enterprise controlled by a PRC enterprise or a PRC enterprise group will be regarded as a PRC tax resident by virtue of having its “de facto management body” in China and will be subject to PRC enterprise income tax on its global income only if all of the following conditions are met: (i) the primary location of the day-to-day operational management and the management department is in the PRC; (ii) decisions relating to the enterprise’s financial and human resource matters are made or are subject to approval by organizations or personnel in the PRC; (iii) the enterprise’s primary assets, accounting books and records, company seals, and board and shareholder resolutions and minutes, are located or maintained in the PRC; and (iv) at least 50% of voting board members or senior executives habitually reside in the PRC. If we were to be considered a PRC resident enterprise, we would be subject to PRC enterprise income tax at the rate of 25% on our global income. In such case, our profitability and cash flow may be materially reduced as a result of our global income being taxed under the Enterprise Income Tax Law. In addition, our shareholders may be subject to PRC tax. We believe that none of our entities outside of China is a PRC resident enterprise for PRC tax purposes.

In addition to the filing with the CSRC per the requirements of the Trial Measures, other approval of or filing with the CSRC or other PRC government authorities may be required in connection with our previous or future offshore offerings under PRC laws, and, if required, we cannot predict whether or for how long we will be able to obtain such approval or complete such filing.

On August 8, 2006, six PRC regulatory agencies, including the Ministry of Commerce (“MOFCOM”), the State-Owned Assets Supervision and Administration Commission, the SAT, the State Administration for Industry and Commerce, the CSRC, and SAFE, jointly adopted the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors (the “M&A Rules”), which came into effect on September 8, 2006, and were amended on June 22, 2009. The M&A Rules include, among other things, provisions that purport to require that an offshore special purpose vehicle that is controlled by PRC domestic companies or individuals and that has been formed for the purpose of an overseas listing of securities through acquisitions of PRC domestic companies or assets to obtain the approval of the CSRC prior to the listing and trading of such special purpose vehicle’s securities on an overseas stock exchange. On September 21, 2006, the CSRC published on its official website procedures regarding its approval of overseas listings by special purpose vehicles.

According to the opinion of our PRC counsel, Han Kun PRC, the CSRC approval is not required under the M&A Rules in the context of this offering because (i) the CSRC currently has not issued any definitive rule or interpretation concerning whether offerings similar to this offering are subject to the M&A Rules; (ii) our PRC subsidiaries were not established by merger with or acquisition of PRC domestic companies as defined under the M&A Rules. However, our PRC legal counsel has further advised us that there remains some uncertainty as to how the M&A Rules will be interpreted or implemented in the context of an overseas offering, and its opinions summarized above are subject to any new laws, rules and regulations or detailed implementations and interpretations in any form relating to the M&A Rules. There can be no assurance that the relevant PRC government agencies, including the CSRC, would reach the same conclusion as that of our PRC legal counsel. If the CSRC or other PRC regulatory body subsequently determines that we need to obtain the CSRC’s approval for this offering or if the CSRC or any other PRC government authorities promulgates any interpretation or implements rules before our listing that would require us to obtain CSRC or other governmental approvals for this offering, we may face sanctions by the CSRC or other PRC regulatory agencies. In any such event, these regulatory agencies may impose fines and penalties on our operations in China, limit our operating privileges in China, delay or restrict the repatriation of the proceeds from this offering into the PRC or take other actions that could have a material adverse effect on our business, financial condition, results of operations, reputation and prospects, as well as our ability to complete this offering. The CSRC or other PRC regulatory agencies may also take actions requiring us, or making it advisable for us, to halt this offering before settlement and delivery of the ordinary shares offered by this prospectus. Consequently, if you engage in market trading or other activities in anticipation of and prior to settlement and delivery, you do so at the risk that such settlement and delivery may not occur. In addition, if the CSRC or

other regulatory agencies later promulgate new rules or explanations requiring us to obtain their approvals for this offering, we may be unable to obtain waivers of such approval requirements. Any uncertainties and/or negative publicity regarding such approval requirements could have a material adverse effect on the trading price of our shares.

Moreover, the Chinese government has also reiterated its intention to oversee the offshore listing activities of Chinese companies. On December 24, 2021, the CSRC published draft Administration Provisions and the draft Filing Measures for public comments. These Draft Regulations require “PRC domestic companies” that directly or indirectly issue or list their securities overseas to file with CSRC certain required documents. On February 17, 2023, the CSRC promulgated the Trial Measures, and the relevant five guidelines, which became effective on March 31, 2023. The Trial Measures will comprehensively improve and reform the existing regulatory regime for overseas offering and listing of PRC domestic companies’ securities and will regulate both direct and indirect overseas offering and listing of PRC domestic companies’ securities by adopting a filing-based regulatory regime. Pursuant to the Trial Measures, PRC domestic companies that seek to offer and list securities in overseas markets, either in direct or indirect means, are required to fulfill the filing procedure with the CSRC and report relevant information. The Trial Measures provides that if the issuer meets both the following criteria, the overseas securities offering and listing conducted by such issuer will be deemed as indirect overseas offering by PRC domestic companies: (i) 50% or more of any of the issuer’s operating revenue, total profit, total assets or net assets as documented in its audited consolidated financial statements for the most recent fiscal year is accounted for by domestic companies; and (ii) the main parts of the issuer’s business activities are conducted in mainland China, or its main place(s) of business are located in mainland China, or the majority of senior management staff in charge of its business operations and management are PRC citizens or have their usual place(s) of residence located in mainland China. Pursuant to the Trial Measures, where a domestic company seeks to indirectly offer and list securities in an overseas market, the issuer shall designate a major domestic operating entity responsible for all filing procedures with the CSRC, and where an issuer makes an application for initial public offering and listing in an overseas market, the issuer shall submit filings with the CSRC within three business days after such application is submitted, and shall complete the filing before the completion of their overseas offering and listing.

According to the Trail Measures, where a domestic company fails to fulfill filing procedure or in violation of the provisions as stipulated above, in respect of its overseas offering and listing, the CSRC shall order rectification, issue warnings to such domestic company, and impose a fine ranging from RMB1,000,000 to RMB10,000,000. Also, the directly responsible person-in-charge and other directly responsible persons of such domestic company may be warned and imposed fines, and the controlling shareholders and the actual controllers of such domestic company that organize or instruct the aforementioned violations shall be imposed fines. The filing procedure with the CSRC under the Trial Measures is required for this offering and any future offerings, listing or any other capital raising activities, it is uncertain whether we could complete the filing procedure in a compliant and timely manner, or at all. During the filing process, we may need to revise and update the disclosure of PRC laws and regulations and PRC legal matters in the prospectus as required by the CSRC. In addition, the Trial Measures may subject us to additional compliance requirement in the future, and we cannot assure you that we will be able to get the clearance of filing procedures under the Trial Measures on a timely basis, or at all. Any failure of us to fully comply with the Trail Measures may significantly limit or completely hinder our ability to offer or continue to offer our ordinary shares, cause significant disruption to our business operations, and severely damage our reputation, which would materially and adversely affect our financial condition and results of operations and cause our ordinary shares to significantly decline in value or become worthless.

On February 24, 2023, the CSRC, together with other PRC government authorities, released the Provisions on Strengthening Confidentiality and Archives Administration in Overseas Issuance and Listing of Securities by Domestic Enterprises (the “Confidentiality and Archives Administration Provisions”), which came into effect on March 31, 2023. The Confidentiality and Archives Administration Provisions require, among others, that PRC domestic enterprises seeking to offer and list securities in overseas markets, either directly or indirectly, shall establish the confidentiality and archives system, and shall complete approval and filing procedures with competent authorities, if such PRC domestic enterprises or their overseas listing entities provide or publicly disclose documents or materials involving state secrets and work secrets of PRC government agencies to relevant securities companies, securities service institutions, overseas regulatory agencies and other entities and individuals. It further stipulates that providing or publicly disclosing by domestic companies, or providing or publicly disclosing through its overseas listing entities, to the relevant securities companies, securities service agencies, overseas regulatory authorities and other entities or individuals documents and materials that may adversely affect national security or public interests

after leakage, the domestic enterprise shall strictly go through the corresponding procedures in accordance with relevant laws and regulations. Where a domestic company provides to the relevant securities companies, securities service institutions, overseas regulatory authorities and other entities or individuals, any accounting records or duplicates of such accounting records, it shall complete relevant procedures according to the relevant regulations. The Confidentiality and Archives Administration Provisions were also newly published, and there remains uncertainty as to their interpretation, application and implementation.

As advised by Han Kun PRC, our PRC counsel, taking into consideration the abovementioned criteria, this offering is an indirect offering under the Trial Measures, and we are subject to the filing requirements of the CSRC. We are required to fulfill the filing procedure with the CSRC in accordance with the Trial Measures. We filed the necessary documents with the CSRC in connection with this offering on February 6, 2025. As of the date of this submission, the review process remains ongoing. During this process, the CSRC may make several rounds of inquiries, and we shall respond and supplement additional materials if necessary. We will not complete this offering until we have received confirmation from the CSRC that we have completed our filing with the CSRC. As of the date of this prospectus, neither we nor our PRC subsidiaries had received any inquiry, notice, warning, or sanction regarding our planned overseas listing from the CSRC or any other PRC governmental authorities. Since these statements and regulatory actions are newly published, however, official guidance and related implementation rules to some of these statements or actions may not have been issued. It is highly uncertain what the potential impact such modified or new laws and regulations will have on the daily business operations of our subsidiaries, our ability to accept foreign investments, and our listing on a U.S. exchange.

We may face risks associated with the international sale of our 3D portraits, and if we are unable to effectively manage these risks, our business, financial condition and results of operations may be materially and adversely affected.

In addition to China, we have sold our 3D portraits in other markets such as Australia, Saudi Arabia and South Korea. While we expect China will continue to be our primary market, the marketing and sale of our 3D portraits to international markets may increase in the future, which will expose us to a number of risks, including, but not limited, to:

•        fluctuations in foreign currency exchange rates;

•        increased costs associated with maintaining the ability to understand the local markets and develop and maintain effective marketing and distributing presence in various countries;

•        providing customer service and support in these markets;

•        difficulty with staffing and managing overseas operations;

•        failure to develop appropriate risk management and internal control structures tailored to overseas operations;

•        difficulty and cost relating to compliance with different commercial and legal requirements of the overseas markets in which we offer or plan to offer our products and services;

•        inability to obtain, maintain or enforce intellectual property rights;

•        unanticipated changes in prevailing economic conditions and regulatory requirements; and

•        trade barriers such as export requirements, tariffs, taxes and other restrictions and expenses.

Our end users are free to photograph, upload and customize our 3D portraits. The regulation and censorship of the cultural industries in the countries in which we operate may adversely affect our business, and we are responsible for the figures we produce. Different countries have different regulations on the censorship of product of cultural industries. For example, the Chinese Government prohibits the production, sale and export of obscene materials. In our business, end users will be taking and uploading their photos, and we will produce 3D portraits in accordance with the photos. According to our agreement with our customers and end users, if applicable, we prohibit our customers and end users from producing, transmitting or publishing content that is prohibited by laws and regulations, such as obscenity, pornography and violence. And we post notices in our offline shops to remind end users to comply with local laws and regulations. However, given that we operate in different countries and that

we do not control all end users’ behavior, we may not be able to fully control the compliance of content uploaded by end users with local laws and regulations. Because we have a relatively large number of individual users, they may not be able to indemnify us against all losses arising from regulatory penalties and third party claims arising from their uploaded content. In addition, because definitions and interpretations of prohibited content are in most cases evolving and subject to changes, it is often impossible to determine or predict what content is prohibited by existing restrictions and what content will be subject to future restrictions. Failure to recognize and prevent illegal or infrequent content or the production of illegal 3D portraits may subject us to serious sanctions and penalties.

In addition, our potential expansion into international markets will require us to respond timely and effectively to rapid changes in market conditions in the relevant countries. Our success in international expansion depends, in part, on our ability to succeed in different legal, regulatory, economic, environmental, social and political conditions which we have little control over. We may not be able to develop and implement policies and strategies that will be effective in each location where we do business. A change in one or more of the factors described above may have a material adverse effect on our business, financial condition and results of operations.

Our operations may be materially and adversely affected if we fail to obtain, maintain and update licenses, approvals, qualification and certifications that are material to our operations.

Our business operations in China are regulated by relevant PRC authorities. We are also required to obtain and maintain the requisite licenses and approvals required in other jurisdictions where we have business operations. And as the interpretation and implementation of existing and future legislations, regulations and policies governing our business activities are evolving, we cannot assure you that we will not be found in violation of any future legislations, regulations and policies nor any of the legislations, regulations and policies in effect. If we fail to obtain, renew or maintain any of the requisite licenses or approvals or make necessary and appropriate filings in any of the jurisdictions where we have business operations, we may be subject to various penalties, including fines, discontinuation or restriction of our business operations. Any such penalties may damage our reputation, disrupt our business operations and even terminate our business operations in those jurisdictions. As such, our results of operations, financial conditions and business prospects could be materially and adversely affected.

Some of our leasehold interests may be defective, which may challenge or affect our right to use the leased properties. In addition, we have not completed registration procedures in respect of our leased properties with the relevant PRC authorities.

We lease a number of properties for our stores, service centers, and offices across China. Certain leased properties are not used in accordance with PRC laws and our leasehold interests in such leased properties are therefore under defective situations.

We have not been provided by certain lessors with the applicable certificates, approvals, consents or other similar documents proving their right to lease or sublease these leased properties to us. If any lessor is not the owner of the leased properties, or is not entitled to lease or sublease the leased properties to us, or have not obtained consents from the owners or their lessors or permits or approvals from the relevant governmental authorities, we may not be able to enforce our rights to lease such leased properties under the respective lease agreements against the lessors and our leases may be invalidated. For example, we cannot be certain if any of our leased properties and properties in use is currently located on allocated lands or collectively-owned construction lands because certain title certificates to these properties or the relevant information contained therein have not been provided to us. If any approval is required and the lessor fails to obtain such approval applicable to these properties, the leases and our right to use these properties may be invalidated or challenged, and we may also need to vacate our premises.

In addition, certain leased properties had been mortgaged by the landlords to third parties before entering into lease agreements with us. If the mortgagees of the leased properties exercise their mortgage right, we will not be able to continue our leases on the said properties. Moreover, some of our lease agreements for our leased properties in China have not been registered with the relevant authorities. With respect to the unregistered leases in China, we may be subject to a fine ranging from RMB1,000 to RMB10,000 per unregistered lease agreement if we fail to make such registration within a given timeframe put forward by the Chinese government. In addition, there are also risks of violating the lease agreements. For example, if we fail to purchase insurance as required by the lessors in certain lease agreements, or if any of our leases are terminated or become unenforceable as a result of challenges from third parties or the above mentioned defects, we would need to seek alternative properties, relocate the relevant functions

and move our stores, offices or service centers somewhere else and incur relocation costs, and there is no guarantee that we would be able to find suitable alternative properties on reasonable commercial terms, if at all. Any relocation could lead to disruptions to our operations and may have an adverse effect on our business, financial condition, results of operations and prospects.

We may be required to change our registered address or relocate our operating offices under PRC law.

Under PRC law, the registered address of a company shall be its main premises for business operations. If a company intends to set up other premises for business operations outside its registered address, the company shall register those premises for business operations as branch offices with the relevant local market regulation authorities at the place where the premises are located and obtain business licenses for them as branch offices.

Currently, some of our subsidiaries have set up premises for business operations outside their registered addresses. We may not be able to change the registered address of our subsidiaries to its operating addresses or register such premises as branch offices in a timely manner or at all due to complex procedural requirements and relocation of branch offices from time to time. Our PRC subsidiaries may be listed as “enterprises with abnormal operations” and disclose the same to the public if they fail to register such premises, and failure to make rectification in a timely manner may further subject our PRC subsidiaries to fines, or subject their respective legal representative or person in charge to administrative orders suspending their term of office for a certain period of time. In the future, we may expand our business to additional locations in China and we may fail to update the registered addresses for our subsidiaries or register those premises as branch offices in a timely manner. If the PRC regulatory authorities determine that we are in violation of the relevant laws and regulations, we may be subject to penalties, including but not limited to fines, being listed on the List of Enterprises with Serious Illegal and Dishonest Acts and publicized to the public, and our business licenses may be revoked under serious circumstances. As of the date of this prospectus, we had not received any regulatory or governmental administrative penalties in relation to the registered address of our subsidiaries. If we become subject to these penalties, our business, results of operations, financial condition and prospects could be materially and adversely affected.

If our estimates or judgments relating to our critical accounting policies prove to be inaccurate, our results of operations could be adversely affected.

The preparation of financial statements in conformity with U.S. GAAP and our key metrics require management to make estimates and assumptions that affect the amounts reported in the combined and consolidated financial statements and accompanying notes and amounts reported in our key metrics. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, as provided in “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The results of these estimates form the basis for making judgments about the carrying values of assets, liabilities and equity and the amount of revenue and expenses that are not readily apparent from other sources. Our results of operations may be adversely affected if our assumptions change or if actual circumstances differ from those in our assumptions, which could cause our results of operations to fall below the expectations of securities analysts and investors, resulting in a decline in the trading price of our securities.

We are subject to laws and regulations relating to environmental protection, fire protection, health and safety, work safety, hazardous chemicals and construction.

During the ordinary course of our business, the relevant production, manufacturing or construction works may subject us to PRC laws and regulations on environmental protection, fire protection, health and safety, work safety, and hazardous chemicals. We have been compliant with such laws and regulations in all material aspects. However, as we continue to expand our business operations and the significant amount of discretion held by local PRC authorities in interpreting, implementing and enforcing relevant rules and regulations, as well as other factors beyond our control, we cannot assure you that there will not be violations or suspected violations that result in us becoming subject to governmental investigations, fines and other legal or administrative sanctions. If we fail to comply with applicable regulations in relation to environmental protection, fire protection, health and safety, work safety, and hazardous chemicals or maintain and renew the relevant permits in a timely manner, we could be subject to fines or be forced to close or temporarily cease part or all of our operations or other penalties, any of which could have a material adverse effect on our business, prospects, financial condition and results of operation.

We may from time to time be subject to claims, disputes, lawsuits and other legal and administrative proceedings.

We are currently not a party to any material legal or administrative proceedings. However, in light of the nature of our business, we and our management are susceptible to potential claims or disputes. We and certain of our management may from time to time in the future be subject to or involved in various claims, disputes, lawsuits and other legal and administrative proceedings. Lawsuits and litigations may cause us to incur defense costs, utilize a significant portion of our resources and divert management’s attention from our day-to-day operations, any of which could harm our business. Claims arising out of actual or alleged violations of law, breach of contract or torts could be asserted against us by customers, business partners, suppliers, competitors, employees or governmental entities in investigations and legal proceedings. In particular, according to the PRC Social Insurance Law and the Regulations on the Administration of Housing Provident Fund and other relevant laws and regulations, employers are required to establish a social insurance system and other employee benefits including pension insurance, medical insurance, work-related injury insurance, unemployment insurance, maternity insurance and housing provident fund (collectively, the “Employee Benefits”). Employers shall open the social insurance and housing provident fund accounts and to make adequate contributions of Employee Benefits for their employees. Employers that fail to do so may be subject to fines and legal sanctions. However, some of our PRC subsidiaries failed to make adequate contributions to social insurance and housing provident fund for certain of our employees, or engaged third-party human resources agencies to pay social insurance premium and housing provident funds for certain of our employees. If the relevant PRC authorities determine that we shall make supplemental contributions, that we are not in compliance with labor laws and regulations, or that we are subject to fines or other legal sanctions, such as order of timely rectification, and our business, financial condition and results of operation may be adversely affected.

We may be subject to additional contributions of social insurance and housing provident fund and late payments and fines imposed by relevant governmental authorities.

In accordance with the above-mentioned PRC laws, companies incorporated in the PRC are required to participate in the Employee Benefits and contribute to the amounts which are equal to a certain percentage of salaries, including bonuses and allowances, of their employees. According to the Social Insurance Law, an employer that has not made social insurance contributions at a rate and based on an amount prescribed by the law, or at all, may be ordered to rectify the non-compliance and pay the required contributions within a stipulated deadline and be subject to a late payment fine at a daily rate of 0.05% per day of the outstanding amount. If the employer still fails to rectify the failure to make social insurance contributions within the stipulated deadline, it may be subject to a fine ranging from one to three times of the amount overdue. Pursuant to the Regulations on the Administration of Housing Provident Fund, in the event that the payment and deposit of the housing provident fund is not made in full or at all in time by an employer, the housing provident fund management center may order it to make the payment and deposit within a prescribed period, and where the payment and deposit has not been made within the prescribed period, an application may be made to the PRC courts for compulsory enforcement.

In addition, under the Social Insurance Law and the Regulations on the Administration of Housing Provident Fund, PRC subsidiaries shall register with local social insurance agencies and register with applicable housing provident fund management centers and establish a special housing provident fund account in an entrusted bank. Employers that do not open the social insurance account may be ordered by the social security administrative authorities to make correction within a stipulated period; where correction is not made within the stipulated period, employers may be subject to a fine ranging from one to three times the amount of the social security premiums payable, and the direct liable administrative staff of such employers may by subject to a fine ranging from RMB500 to RMB3,000. Employers that do not register the housing provident fund may be ordered by the housing provident fund management center to complete the housing fund payment registration within a prescribed time limit, failing to do so may be subjected to a fine from RMB10,000 to RMB50,000.

We cannot assure you that the relevant governmental authorities will not require us to pay the outstanding amount and impose late fees or fines on us. If we are otherwise subject to investigations related to non-compliance with labor and social security laws and regulations and are imposed severe penalties or incur significant legal fees in connection with labor or social security law disputes or investigations, our business, financial condition and results of operations may be adversely affected.

If we fail to maintain an effective system of internal control over financial reporting, we may be unable to accurately report our financial results or prevent fraud, and investor confidence in our company and the market price of our securities may be adversely affected.

Prior to this offering, we were a private company with limited accounting personnel and other resources with which to address our internal controls and procedures. Our management has not completed an assessment of the effectiveness of our internal control over financial reporting and our independent registered public accounting firm has not conducted an audit of our internal control over financial reporting. In connection with the preparation and audit of our combined and consolidated financial statements as of and for the year ended December 31, 2023, we and our independent registered public accounting firm identified three material weaknesses in our internal control over financial reporting. As defined in the standards established by the PCAOB, a “material weakness” is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.

The material weaknesses identified relate to (i) lack of sufficient accounting personnel for financial information processing and reporting and with appropriate U.S. GAAP knowledge and (ii) lack of formal risk assessment process over financial reporting. We have implemented and are continuing to implement a number of measures to address the material weaknesses that has been identified. For details, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Internal Control Over Financial Reporting.” However, we cannot assure you that we will be able to continue implementing these measures in the future, or that we will not identify additional material weaknesses or significant deficiencies in the future.

We will be subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act and the rules and regulations of Nasdaq after the completion of this offering. The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures and internal controls over financial reporting. Commencing with our fiscal year ending December 31, 2025, we must perform system and process evaluation and testing of our internal controls over financial reporting to allow management to report on the effectiveness of our internal controls over financial reporting in our Form 20-F filing for that year, as required by Section 404 of the Sarbanes-Oxley Act. Our management may conclude that our internal control over financial reporting is not effective. Moreover, even if our management concludes that our internal control over financial reporting is effective, our independent registered public accounting firm, after conducting its own independent testing, may issue a report that is qualified if it is not satisfied with our internal controls or the level at which our controls are documented, designed, operated or reviewed, or if it interprets the relevant requirements differently from us. This will require that we incur substantial additional professional fees and internal costs to expand our accounting and finance functions and that we expend significant management efforts.

In addition, our internal control over financial reporting will not prevent or detect all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud will be detected.

If we are not able to comply with the requirements of Section 404 of the Sarbanes-Oxley Act in a timely manner, or if we are unable to maintain proper and effective internal controls, we may not be able to produce timely and accurate financial statements. If that were to happen, the market price of our securities could decline and we could be subject to sanctions or investigations by Nasdaq, SEC or other regulatory authorities.

Risks Related to This Offering

Our principal shareholders have substantial influence over our company. Their interests may not be aligned with the interests of our other shareholders, and they could prevent or cause a change of control or other transactions.

Our sole director, Libin Kuang, owns 56.6% of our ordinary shares through his ownership of Pinnacle Pioneers Limited before this offering, and will own 47.7% of our ordinary shares upon the completion of the offering. Our co-founders, Mr. Shuxun Huang, owns 11.5% of our ordinary shares through his ownership of Galatea Digital Limited, and will own 9.72% of our shares upon the completion of the offering.

Accordingly, our executive officers and directors could have significant influence in determining the outcome of any corporate transaction or other matter submitted to the shareholders for approval, including mergers, consolidations, the election of directors and other significant corporate actions. In cases where their interests are aligned and they vote together, these shareholders will also have the power to prevent or cause a change in control. Without the consent of some or all of these shareholders, we may be prevented from entering into transactions that could be beneficial to us or our minority shareholders. In addition, our directors and officers could violate their fiduciary duties by diverting business opportunities from us to themselves or others. The interests of our largest shareholders may differ from the interests of our other shareholders. The concentration in the ownership of our ordinary shares may cause a material decline in the value of our ordinary shares.

We may become a “controlled company” within the meaning of the Nasdaq rules and the rules of the SEC. As a result, we may qualify for exemptions from certain corporate governance requirements that provide protection to shareholders of other companies.

Although Messrs. Kuang and Huang, our founder and co-founder, are not currently acting as a group, they may act as a group following the offering, in which case we may be considered a “controlled company” under the Nasdaq rules. As a result, we may be a “controlled company” within the meaning of the corporate governance standards of the Nasdaq. Under these rules, a company of which more than 50% of the voting power is held by an individual, group or another company is a “controlled company” and may elect not to comply with certain corporate governance requirements, including:

•        the requirement that a majority of our board of directors consist of “independent directors” as defined under the rules of the Nasdaq;

•        the requirement that we have a compensation committee that is composed entirely of directors who meet the Nasdaq independence standards for compensation committee members with a written charter addressing the committee’s purpose and responsibilities; and

•        the requirement that our director nominations be made, or recommended to our full board of directors, by our independent directors or by a nominations committee that consists entirely of independent directors and that we adopt a written charter or board resolution addressing the nominations process.

Following this offering, we do not intend to utilize these exemptions. However, if we utilize any of these exemptions in the future, you will not have the same protections afforded to shareholders of companies that are subject to all of the corporate governance requirements of the Nasdaq.

There has been no public market for our ordinary shares prior to this offering and you may not be able to resell our ordinary shares at or above the price you pay for them, or at all.

Prior to this initial public offering, there has been no public market for our ordinary shares. If an active trading market for our ordinary shares does not develop after this offering, the market price and liquidity of the shares will be materially and adversely affected. The initial public offering price for the ordinary shares was determined by negotiations between us and the underwriter and may bear no relationship to the market price for our ordinary shares after the initial public offering. We cannot assure you that an active trading market for our ordinary shares will develop or that the market price of our ordinary shares will not decline below the initial public offering price.

The trading price of the ordinary shares may be volatile, which could result in substantial losses to you.

The trading prices of the ordinary shares are likely to be volatile and could fluctuate widely due to factors beyond our control. This may happen because of broad market and industry factors, like the performance and fluctuation in the market prices or the underperformance or deteriorating financial results of other listed companies based in China. The securities of some of these companies have experienced significant volatility since their initial public offerings, including, in some cases, substantial price declines in the trading prices of their securities. The trading performances of other Chinese companies’ securities after their offerings may affect the attitudes of investors toward Chinese companies listed in the United States, which consequently may impact the trading performance of the ordinary shares, regardless of our actual operating performance. In addition, any negative news or perceptions about inadequate corporate governance practices or fraudulent accounting, corporate structure or matters of other Chinese companies may also negatively affect the attitudes of investors towards Chinese companies in general,

including us, regardless of whether we have conducted any inappropriate activities. Furthermore, securities markets may from time to time experience significant price and volume fluctuations that are not related to our operating performance, such as the large decline in share prices in the United States, China and other jurisdictions in late 2008, early 2009, the second half of 2011, 2015 and the first quarter of 2020. In particular, concerns about the economic impact of the coronavirus outbreak have triggered significant price fluctuations in the U.S. stock market. All these fluctuations and incidents may have a material and adverse effect on the trading price of the ordinary shares.

In addition to the above factors, the price and trading volume of the ordinary shares may be highly volatile due to multiple factors, including the following:

•        regulatory developments affecting us or our industry;

•        announcements of studies and reports relating to the quality of our product offerings or those of our competitors;

•        changes in the economic performance or market valuations of other 3D photography companies;

•        actual or anticipated fluctuations in our quarterly results of operations and changes or revisions of our expected results;

•        changes in financial estimates by securities research analysts;

•        conditions in the 3D photography market in China and the international markets in which we operate;

•        announcements by us or our competitors of new product and service offerings, acquisitions, strategic relationships, joint ventures, capital raisings or capital commitments;

•        additions to or departures of our senior management;

•        fluctuations of exchange rates between the Renminbi and the U.S. dollar;

•        release or expiry of lock-up or other transfer restrictions on our issued shares; and

•        sales or perceived potential sales of additional ordinary shares.

Because we do not expect to pay cash dividends in the foreseeable future after this offering, you may not receive any return on your investment unless you sell your ordinary shares for a price greater than that which you paid for them.

We currently intend to retain most, if not all, of our available funds and any future earnings after this offering to fund the development and growth of our business. We do not expect to pay any cash dividends in the near future. See “Dividend Policy.” Therefore, you should not rely on an investment in the ordinary shares as a source for any future dividend income.

Our board of directors has complete discretion as to whether to distribute dividends. Even if our board of directors decides to declare and pay dividends, the timing, amount and form of future dividends, if any, will depend on, among other things, our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from our subsidiaries, our financial condition, contractual restrictions and other factors deemed relevant by our board of directors. Accordingly, the return on your investment in the ordinary shares will likely depend entirely upon any future price appreciation of the ordinary shares. There is no guarantee that the ordinary shares will appreciate in value after this offering or even maintain the price at which you purchased the ordinary shares. You may not realize a return on your investment in the ordinary shares and you may even lose your entire investment in the ordinary shares.

You will experience immediate dilution in the net tangible book value of ordinary shares purchased.

When you purchase our ordinary shares in the offering, you will incur immediate dilution of approximately $           per share, representing the difference between the initial public offering price of $           per share shown on the front cover of this prospectus, and our pro forma as-adjusted net tangible book value per share as

•        providing that all vacancies in our Board may, except as otherwise be required, be filled by ordinary resolution or appointed by our Board, provided that the number of directors so appointed shall not exceed the maximum number determined from time to time by the shareholders in general meeting; and

•        providing that our Memorandum and Articles of Association may be amended by a special resolution being the affirmative vote of a majority of at least two-thirds of the votes cast by such shareholders as, being entitled to do, vote in person or by proxy or, in the cases of Shareholders which are corporations, by their respective duly authorized representatives.

There can be no assurance that we will not be a passive foreign investment company, or PFIC, for United States federal income tax purposes for any taxable year, which could subject United States investors in our ordinary shares to significant adverse United States income tax consequences.

A non-U.S. corporation, such as our company, will be classified as a passive foreign investment company, or PFIC, for U.S. federal income tax purposes for any taxable year if either (i) 75% or more of our gross income for such year consists of certain types of “passive” income or (ii) 50% or more of the value of our assets (generally determined on the basis of a quarterly average) during such year produce or are held for the production of passive income (the “asset test”). Passive income generally includes dividends, interest, royalties, rents, annuities, net gains from the sale or exchange of property producing such income and net foreign currency gains. For this purpose, cash and assets readily convertible into cash are categorized as passive assets and the company’s goodwill and other unbooked intangibles are generally taken into account when determining the value of its assets. Based upon our current and expected income and assets, including goodwill and other unbooked intangibles not reflected on our balance sheet (taking into account the expected proceeds from this offering) and projections as to the market price of our Ordinary Shares immediately following the offering, we do not expect to be classified as a PFIC for the current taxable year or the foreseeable future. While we do not expect to be classified as a PFIC, because the value of our assets for purposes of the asset test may be determined by reference to the market price of our ordinary shares, fluctuations in the market price of our ordinary shares may cause us to be classified as a PFIC for the current or subsequent taxable years. The determination of whether we will be classified as a PFIC will also depend, in part, on the composition of our income and assets. In addition, the composition of our income and assets will also be affected by how, and how quickly, we use our liquid assets and the cash raised in this offering. If we determine not to deploy significant amounts of cash for active purposes, our risk of being a PFIC may substantially increase. It is also possible that the U.S. Internal Revenue Service, or the IRS, could challenge our classification of certain income and assets as non-passive, which could result in our company being or becoming a PFIC for the current or future taxable years. Because PFIC status is a factual determination made annually after the close of each taxable year, there can be no assurance that we will not be a PFIC for the current taxable year or any future taxable year.

If we are a PFIC in any taxable year, a U.S. Holder (as defined in “Taxation — Material U.S. Federal Income Tax Considerations”) may incur significantly increased U.S. income tax on gain recognized on the sale or other disposition of the ordinary shares to the extent such distribution is treated as an “excess distribution” under the U.S. federal income tax rules, and such U.S. Holder may be subject to burdensome reporting requirements. Further, if we are a PFIC for any year during which a U.S. Holder holds our ordinary Shares, we generally will continue to be treated as a PFIC for all succeeding years during which such U.S. Holder holds our ordinary shares, unless we were to cease to be a PFIC and the U.S. Holder were to make a “deemed sale” election with respect to the ordinary shares. For more information see “Taxation — Material U.S. Federal Income Tax Considerations — PFIC Rules.”

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements that reflect our current expectations and views of future events. The forward-looking statements are contained principally in the sections entitled “Prospectus Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business” and “Regulations.” Known and unknown risks, uncertainties and other factors, including those listed under “Risk Factors,” may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements.

You can identify some of these forward-looking statements by words or phrases such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “is/are likely to,” “potential,” “continue” or other similar expressions. We have based these forward-looking statements largely on our current expectations and projections about future events that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements include statements relating to:

•        our goals and strategies;

•        our prospects, future business development, financial condition and results of operations;

•        the expected growth of the consumer product industry;

•        our expectations regarding demand for and market acceptance of our products and services;

•        our expectations regarding our bases of customers;

•        our plans to invest in our products and services;

•        competition in the consumer product industry;

•        our plans to expand in various geographic markets;

•        our expectations regarding our sales channels;

•        our planned use of proceeds; and

•        relevant government policies and regulations relating to the consumer product industry.

These forward-looking statements involve various risks and uncertainties. Although we believe that our expectations expressed in these forward-looking statements are reasonable, our expectations may later be found to be incorrect. The forward-looking statements made in this prospectus relate only to events or information as of the date on which the statements are made in this prospectus. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. You should thoroughly read this prospectus and the documents that we refer to herein with the understanding that our actual future results may be materially different from and worse than what we expect. We qualify all of our forward-looking statements by these cautionary statements.

This prospectus contains certain data and information that we obtained from various government and private publications. Statistical data in these publications also include projections based on a number of assumptions. The consumer product industry may not grow at the rate projected by market data, or at all. Failure of this industry to grow at the projected rate may have a material and adverse effect on our business and the market price of our ordinary shares. In addition, the rapidly changing nature of this industry results in significant uncertainties for any projections or estimates relating to the growth prospects or future condition of our industry. Furthermore, if any one or more of the assumptions underlying the market data are later found to be incorrect, actual results may differ from the projections based on these assumptions. You should not place undue reliance on these forward-looking statements.

The forward-looking statements made in this prospectus relate only to events or information as of the date on which the statements are made in this prospectus. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. You should read this prospectus and the documents that we refer to in this prospectus and have filed as exhibits to the registration statement, of which this prospectus is a part, completely and with the understanding that our actual future results may be materially different from what we expect.

USE OF PROCEEDS

We estimate that we will receive net proceeds from this offering of approximately US$           million, or approximately US$           million if the underwriter exercises its option to purchase additional ordinary shares in full, after deducting underwriting discounts and the estimated offering expenses payable by us and based upon an assumed initial offering price of $           per ordinary share (the mid-point of the estimated public offering price range shown on the front cover of this prospectus). A US$1.00 increase (decrease) in the assumed initial public offering price of US$           per ordinary share would increase (decrease) the net proceeds to us from this offering by US$          , after deducting the estimated underwriting discounts and commissions and estimated aggregate offering expenses payable by us and assuming no change to the number of ordinary shares offered by us as set forth on the cover page of this prospectus.

We anticipate using the net proceeds of this offering as follows:

Global Market Expansion (approximately 50%):    We estimate approximately US$          million will be used for global market expansion, and we believe the proceeds will be sufficient to cover these costs.

•        15% of the proceeds will be allocated towards the establishment of an operations and management team for our foreign markets and the enhancement of our marketing efforts on a global scale. We will partner with local agents and distributors to launch our operations in foreign markets with strong consumption power, such as Europe, the Americas, the Middle East and East Asia.

•        20% of the proceeds will be used to expand our operations in the Chinese market. We will open self-owned stores in strategic locations of first-tier and second-tier cities in China. We will also work with local partners with the ability to further extend our store network.

•        15% of the proceeds will be used to organize marketing activities in our Chinese and foreign markets, such as Europe, the Americas, the Middle East and East Asia, and to hire key opinion leaders to promote our products.

Research and Development Enhancement (approximately 30%):

•        5% of the proceeds will be allocated to the development of 3D photography booths for pets.

•        25% of the proceeds will be allocated to the development of 3D construction algorithms, algorithms for new products, and our SaaS system.

Working Capital Supplementation (approximately 20%):    The remaining proceeds will be used to supplement our working capital. This will support our day-to-day operational needs in production capacity building (e.g. equipment, inventories and raw materials), ensuring we have adequate resources to manage our business effectively and pursue growth opportunities as they arise.

The foregoing represents our intentions as of the date of this prospectus with respect to the use and allocation of the net proceeds of this offering based upon our present plans and business conditions, but our management will have significant flexibility and discretion in applying the net proceeds of the offering. The occurrence of unforeseen events or changed business conditions may result in application of the proceeds of this offering in a manner other than as described in this prospectus.

To the extent that the net proceeds we receive from this offering are not immediately applied for the above purposes, we intend to invest our net proceeds in short-term, interest bearing, debt instruments or bank deposits.

In utilizing the proceeds of this offering, we are permitted under PRC laws and regulations to provide funding to our PRC subsidiaries only through loans or capital contributions, subject to satisfaction of applicable government registration and approval requirements. We cannot assure you that we will be able to obtain these government registrations or approvals on a timely basis, if at all. See “Risk Factors — Risks Related to Our Legal and Regulatory Environment — PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from using the proceeds of our offshore financing to make loans or additional capital contributions to our PRC subsidiaries, which could materially and adversely affect our liquidity and our ability to fund and expand our business.”

DIVIDEND POLICY

Our board of directors (“Board”) has discretion on whether to distribute dividends, subject to certain requirements of Cayman Islands law. In addition, subject to any rights and restrictions for the time being attached to any shares, our Company may by ordinary resolution declare a dividend, but no dividend may exceed the amount recommended by the Board. In either case, all dividends are subject to certain restrictions under Cayman Islands law, namely that our Company may only pay dividends out of profits or share premium, and provided always that, in no circumstances may a dividend be paid if this would result in our Company being unable to pay its debts as they fall due in the ordinary course of business. Even if we decide to pay dividends, the form, frequency and amount will depend upon our future operations and earnings, capital requirements and surplus, general financial condition, contractual restrictions and other factors that the Board may deem relevant. The Company did not distribute any dividends in 2023 and 2024.

DILUTION

If you invest in our ordinary shares, your interest will be diluted to the extent of the difference between the initial public offering price per ordinary share and our net tangible book value per ordinary share after this offering. Dilution results from the fact that the initial public offering price per ordinary share is substantially in excess of the book value per ordinary share attributable to the existing shareholders for our presently issued and outstanding Ordinary Shares.

Our net tangible book value as of December 31, 2024 was approximately (US$1.5 million), or (US$0.08) per ordinary share as of that date. Net tangible book value represents the amount of our total consolidated tangible assets, less the amount of our total consolidated liabilities. Dilution is determined by subtracting net tangible book value per ordinary share, after giving effect to the additional proceeds we expect to receive from this offering, from the assumed initial public offering price of US$           per ordinary share, which is the midpoint of the estimated offering price range set forth on the cover page of this prospectus after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

Without taking into account any other changes in net tangible book value after           , other than to give effect to the sale of            ordinary shares offered in this offering at the assumed initial public offering price of US$           per ordinary share, the mid-point of the estimated range of the offering price, after deduction of the underwriting discounts and commissions and estimated offering expenses payable by us, our pro forma as adjusted net tangible book value as of            would have been approximately US$           million, or US$           per ordinary share. This represents an immediate increase in net tangible book value of US$           per ordinary share to the existing shareholders and an immediate dilution in net tangible book value of US$           per ordinary share to investors purchasing ordinary shares in this offering. The following table illustrates such dilution:

Each US$1.00 change in the assumed public offering price of US$           per ordinary share would increase (decrease) our pro forma as adjusted net tangible book value after giving effect to this offering by approximately US$           million, the pro forma as adjusted net tangible book value per ordinary share after giving effect to this offering by US$           per ordinary share, and the dilution in pro forma as adjusted net tangible book value per ordinary share to new investors in this offering by US$           per ordinary share, assuming no change to the number of ordinary shares offered by us as set forth on the cover page of this prospectus, and after deducting underwriting discounts and commissions and other offering expenses.

The following table summarizes, on a pro forma as adjusted basis as of           , the differences between existing shareholders and the new investors with respect to the number of ordinary shares purchased from us in this offering, the total consideration paid and the average price per ordinary share paid before deducting the underwriting discounts and commissions and estimated offering expenses. The total number of ordinary shares does not include ordinary shares issuable upon the exercise of the over-allotment option granted to the underwriter.

The pro forma as adjusted information discussed above is illustrative only. Our net tangible book value following the completion of this offering is subject to adjustment based on the actual initial public offering price of our ordinary shares and other terms of this offering determined at pricing.

ENFORCEMENT OF CIVIL LIABILITIES

We are registered under the laws of the Cayman Islands as an exempted company with limited liability. We are registered in the Cayman Islands because of certain benefits associated with being a Cayman Islands corporation, such as political and economic stability, an effective judicial system, a favorable tax system, the absence of foreign exchange control or currency restrictions and the availability of professional and support services. However, the Cayman Islands has a less developed body of securities laws as compared to the United States and provides protections for investors to a significantly lesser extent. In addition, Cayman Islands companies may not have standing to sue before the federal courts of the United States.

A substantial portion of our assets are located in China. In addition, all of our directors and officers are residents of jurisdictions other than the United States and all or a substantial portion of their assets are located outside the United States. All of our directors and executive officers reside in China and are PRC residents. As a result, it may be difficult for investors to effect service of process within the United States upon us or these persons, or to enforce against us or them judgments obtained in United States courts, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States. It may also be difficult for you to enforce in United States courts judgments obtained in United States courts based on the civil liability provisions of the United States federal securities laws against us, our officers and directors.

Maples and Calder (Cayman) LLP, our counsel as to Cayman Islands law, and Han Kun PRC, our counsel as to PRC law, have advised us in respect of their respective jurisdiction, that there is uncertainty as to whether the courts of the Cayman Islands or the PRC would, respectively, (1) recognize or enforce judgments of United States courts obtained against us or our directors or officers predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States, or (2) entertain original actions brought in the Cayman Islands or the PRC against us or our directors or officers predicated upon the securities laws of the United States or any state in the United States.

We have been advised by Maples and Calder (Cayman) LLP, our Cayman Islands legal counsel, that the courts of the Cayman Islands are unlikely (i) to recognize or enforce against us judgments of courts of the United States predicated upon the civil liability provisions of the federal securities laws of the United States or any state; and (ii) in original actions brought in the Cayman Islands, to impose liabilities against us predicated upon the civil liability provisions of the federal securities laws of the United States or any state, so far as the liabilities imposed by those provisions are penal in nature. In those circumstances, although there is no statutory enforcement in the Cayman Islands of judgments obtained in the United States, the courts of the Cayman Islands will recognize and enforce a foreign money judgment of a foreign court of competent jurisdiction without retrial on the merits based on the principle that a judgment of a competent foreign court imposes upon the judgment debtor an obligation to pay the sum for which judgment has been given provided certain conditions are met. For a foreign judgment to be enforced in the Cayman Islands, such judgment must be final and conclusive and for a liquidated sum, and must not be in respect of taxes or a fine or penalty, inconsistent with a Cayman Islands judgment in respect of the same matter, impeachable on the grounds of fraud or obtained in a manner, or be of a kind the enforcement of which is, contrary to natural justice or the public policy of the Cayman Islands (awards of punitive or multiple damages may well be held to be contrary to public policy). A Cayman Islands Court may stay enforcement proceedings if concurrent proceedings are being brought elsewhere.

Han Kun PRC has advised us that the recognition and enforcement of foreign judgments are provided for under the PRC Civil Procedure Law. PRC courts may recognize and enforce foreign judgments in accordance with the requirements of the PRC Civil Procedure Law based either on treaties between China and the country where the judgment is made or on principles of reciprocity between jurisdictions. Han Kun PRC has advised us further that under PRC law, a foreign judgment, which does not otherwise violate basic legal principles, state sovereignty, safety or social public interest, may be recognized and enforced by a PRC court, based either on treaties between China and the country where the judgment is made or on principles of reciprocity between jurisdictions. As there existed no treaty or other form of reciprocity between China and the United States governing the recognition and enforcement of judgments as of the date of this prospectus, including those predicated upon the liability provisions of the United States federal securities laws, there is uncertainty whether and on what basis a PRC court would enforce judgments rendered by United States courts.

OUR CORPORATE STRUCTURE

Sharewow is a holding company incorporated on August 1, 2024, under the laws of the Cayman Islands. Its registered office is located at the offices of Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands. Structured as a holding company with no substantive operations, Sharewow conducts its operations through its PRC subsidiaries, namely WFOE, Suxiang Technology, Xiamen Yuwa, Tianjin Suxiang, Beijing Suxiang and Guangzhou Yuwa.

Our founder, Mr. Kuang, started our sales of photography equipment business through the incorporation of Suxiang Technology in Xiamen, PRC, on November 14, 2016. Currently, Suxiang Technology has a registered capital of RMB 1,010,101 and 100% of its equity interests are held by WFOE.

With the growth of our business, Mr. Kuang incorporated Shanghai Kenge Cultural Production Co. Ltd. in Shanghai, PRC, on January 14, 2020. It was renamed as Xiamen Yuwa and re-domiciled in Xiamen on December 6, 2022. Xiamen Yuwa has a registered capital of RMB1,000,000 and 100% of its equity interests are currently held by Suxiang Technology.

Tianjin Suxiang was incorporated in Tianjin, PRC, on November 8, 2022. It has a registered capital of RMB100,000 and 100% of its equity interests are currently held by Suxiang Technology.

Guangzhou Yuwa was incorporated in Guangzhou, PRC, on December 6, 2023. It has a registered capital of RMB30,000 and 100% of its equity interests are currently held by Xiamen Yuwa.

Beijing Suxiang was incorporated in Beijing, PRC, on June 28, 2024. It has a registered capital of RMB1,000,000 and 100% of its equity interests are currently held by Suxiang Technology.

As of December 31, 2024, we had one Self-operated Store, one Jointly-operated Store, 51 Franchise Stores and nine Customer-Brand Stores.

In order to facilitate international capital raising, we underwent an offshore reorganization in 2024 and Sharewow was incorporated as an exempted company with limited liability in August 2024 under the law of the Cayman Islands to act as our holding company. Shortly after its incorporation, Sharewow established BVI Entity, a wholly-owned subsidiary in the British Virgin Islands, on August 12, 2024. BVI Entity in turn established HK Entity, a wholly-owned subsidiary in Hong Kong, on August 21, 2024. On October 12, 2024, HK Entity incorporated WFOE in the PRC. WFOE acquired 100% of the equity interests in Suxiang Technology on November 14, 2024, and Sharewow became the ultimate holding company of Suxiang Technology and its operating subsidiaries.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with the section entitled “Selected Consolidated Financial Data” and our combined and consolidated financial statements and related notes included elsewhere in this prospectus. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under “Risk Factors” and elsewhere in this prospectus. We assume no obligation to update any of these forward-looking statements.

Key Factors Affecting Our Results of Operations

We recognize that the performance of our 3D camera equipment and 3D figurines business is influenced by a multitude of factors. These factors, both general and specific to our industry and target market segments — general consumers and retail chain clients, shape our operational outcomes and strategic directions. We outline the key factors that significantly impact our results of operations as following:

Market Growth and Consumer Demand

The rapid growth of the global market for consumer electronics, network communication, and 3D content is a significant driver for our business. As the market for 3D photography, particularly 3D portrait souvenirs, expands, we anticipate increased demand for our products. However, this growth also attracts competition, which could impact our market share and pricing power.

Proprietary Technologies and Data Utilization

Leveraging proprietary technologies and extensive data reserves is essential for our ongoing optimization efforts. By continuously refining our algorithms, facilitating cost reductions, and improving production efficiency, we can enhance our profitability and competitiveness in the market.

Quality Control and Fulfillment

Our ability to provide rigorous quality control and prompt fulfillment is crucial for maintaining customer and end users satisfaction and loyalty. Our end-to-end production and delivery capabilities enable us to ensure high-quality products and timely delivery, which are essential for our reputation and market position.

Economic Conditions

Macroeconomic factors, such as GDP growth, inflation rates, and consumer confidence, influence overall spending patterns. Economic downturns can lead to reduced discretionary spending, impacting our sales to both general consumers and retail clients.

Brand Recognition and Marketing Efforts

Our brand recognition and marketing strategies play a significant role in driving sales. Effective marketing campaigns, social media engagement, and positive end users reviews can increase our visibility and attract new end users.

Seasonality and Event-Driven Demand

Demand for our 3D camera equipment and 3D figurines can be seasonal or event-driven. For instance, holidays, weddings, and conventions can create spikes in demand. Understanding and planning for these patterns is crucial for optimizing our production and inventory management.

Understanding and mitigating the risks associated with these key factors is essential for our long-term success. We continuously monitor these areas, adjust our strategies as needed, and communicate transparently with our stakeholders about the impacts on our operations and financial performance.

Key Components of Results of Operations

We specialize in 3D photography and digital figurines, operating under the flagship brands ‘Suwa’ and ‘Sharewow,’ and aim to become a global leader in the 3D photography industry. We possess a comprehensive suite of core technologies spanning from data collection to final product delivery. Our business operations are bolstered by advanced hardware and software R&D centers, a dedicated 3D imaging capture equipment manufacturing center, and robust brand operation centers. Through our worldwide chain of 3D photo stores, we offer 3D photography services, utilizing proprietary 3D photography devices and technology, striving to deliver an unparalleled experience to our customers and end users.

The following table sets forth our revenues by type of contract and as a percentage of revenue for the years indicated:

The following table sets forth our revenues by product lines and as a percentage of revenue for the fiscal years indicated:

The following table sets forth our revenues by geographic region and as a percentage of revenue for the fiscal years indicated:

Overview

The table below sets forth certain line items from our consolidated statement of comprehensive loss (income) for the fiscal years ended December 31, 2023 and 2024:

•        We incurred net loss of RMB5.5 million and net loss of RMB6.6 million (US$0.9 million) for the years ended December 31, 2023 and 2024, respectively. The increase in loss was mainly due to increase of operating expenses, partially offset by the increase of gross profit.

•        Currently revenue are primarily generated from chain stores. Revenue from chain store increased from RMB11.6 million for the year ended December 31, 2023 to RMB13.7 million (US$1.9 million) for the year ended December 31, 2024, representing a 17.5% increase, which was mainly due to the increase in number of stores. Our store network affects our business and revenue growth. We believe we are among one of the largest 3D photography network in China in terms of number of stores as of December 31, 2023 and 2024. The following table set out the total number of our chain stores (including Franchise Stores, Customer-brand Stores, Jointly operated Stores and Self-operated Stores) and their movements for the periods indicated.

•        In April 2022, we launched our franchise initiative by adopting a business to business to consumer (B2B2C) model, and opened the first franchise store. This strategic framework involves collaborating with carefully chosen partners who will own and operate stores under our brand or integrate our photography technology. This model will complement our Self-operated Store and enable us to penetrate new markets more efficiently. As of December 31, 2023, we had 45 Franchise Stores, 2 Customer-brand Stores, 1 Jointly operated Store and 1 Self-operated Store. As of December 31, 2024, we had 51 Franchise stores, 9 Customer-brand Stores, 1 Jointly-operated Store and 1 Self-operated Store.

•        Our revenue stream is mainly derived from sales of 3D camera equipment and 3D printed figurine, which contributed 88.2% and 86.3% of total revenue for the years ended December 31, 2023 and 2024, respectively.

•        We had a rapid growth in sales in Australia and Latin American countries including Mexico, Salvador, Peru. We launched our first franchise store in New Jersey of the U.S. in 2024. Aggregate sales in these area contributed 2.2% and 15.8% of total revenue for the years ended December 31, 2023 and 2024, respectively.

•        Operating expenses consist of selling expenses, general and administrative expenses, research and development (“R&D”) expenses and other (income) expense. The increase in operating expense for the fiscal year ended December 31, 2024 (compared to year ended December 31, 2023) was mainly due to the increase in selling expenses, general and administrative expenses and increase in R&D expenses.

Revenue

Revenue for the year ended December 31, 2024 was RMB14.1 million (US$2.0 million), an increase of RMB1.4 million, or 11.4%, from RMB12.7 million for the year ended December 31, 2023. The increase was attributable to the increase in revenue from Franchise Stores and other chain stores. The revenue from chain stores increased by RMB2.1 million, or 17.5% from RMB11.6 million for the year ended December 31, 2023 to RMB13.7 million for the year ended December 2024. We had expanded our chain store count from 49 as of December 31, 2023 to 66 as of December 31, 2024, which has had a direct and positive impact on our sales, particularly in the sales of 3D printed figurines and their accessories. Sales of 3D printed figurine and their accessories increased by RMB0.8 million, or 13.4% from RMB6.0 million for the year ended December 31, 2023 to RMB6.8 million for the year ended December 31, 2024.

Cost of sales

Our cost of sales mainly consists of cost of raw materials, labor, rental and utilities of plant area and depreciation of equipment.

Cost of sales for the year ended December 31, 2024, was RMB8.8 million (US$1.2 million), an increase of RMB0.5 million, or 6.2%, from RMB8.3 million for the year ended December 31, 2023. The increase was mainly due to the increase in cost of sales of 3D printed figurine of RMB0.7 million, partially offset by the decrease in cost of sales of 3D camera equipment of RMB0.1 million. The increase in the cost of sales in 3D printed figurine was mainly attributed to the increase of volume sold in 3D printed figurine and increase in unit cost of raw materials.

Gross profit

Gross profit for the year ended December 31, 2024 was RMB5.3 million (US$0.7 million), representing an increase of RMB0.9 million, or 21.3%, from the gross profit of RMB4.4 million for the year ended December 31, 2023 as a result of factors mentioned above.

Overall gross profit margin for the fiscal year ended December 31, 2024 was 37.7%, or 3.1% higher, as compared to gross profit margin of 34.6% for the year ended December 31, 2023. This increase was primarily attributed to the introduction of new generation of 3D photo booth, which resulted in a decrease in material consumption and an increase in gross margin.

Operating expenses

____________

(1)      These expenses are combined as general and administrative expenses in consolidated statements of comprehensive income (loss).

Our operating expenses consist of selling expenses, general and administrative expenses, R&D expenses and other expenses, net. Operating expenses increased by RMB2.0 million, or 19.7%, from RMB10.1 million for the year ended December 31, 2023 to RMB12.1 million (US$1.7 million) for year ended December 31, 2024. The increase in our operating expenses was mainly attributed to (i) increase in selling expenses by RMB0.8 million (ii) increase in general and administrative expenses by RMB0.6 million and (iii) increase in R&D expenses by RMB0.5 million.

Selling expenses consist of salary and benefits, advertisement and market promotion, delivery expenses, business travel and other expenses relating to our sales and marketing activities. The increase in selling expense was mainly due to increase in advertisement expenses of RMB0.6 million and delivery expenses of RMB0.2 million, to promote and response to the growing volume of sales orders. Our business relies heavily on skilled and talented

workforce, including designers, 3D printing technicians, sales personnel, and customer service teams. As the business expands, there is often a need to adjust staffing levels to meet growing demand, leading to increased manpower costs. To enhance brand recognition and attract more customers, we may have substantial investment in advertising campaigns, including digital marketing, social media promotions, and traditional advertising mediums. Efficient logistics management is crucial to mitigating delivery costs. By optimizing our human resources and leveraging advanced logistical solutions, we aim to balance the growth in sales with controlled delivery costs, ensuring sustained profitability and operational efficiency.

General and administrative expenses primarily include salary and benefits to our accounting, human resources, corporate service and executive office staff, office rental expenses, property management fees, utilities expenses, legal and professional expenses and office miscellaneous expenses. The increase was mainly due to increase in consulting service by RMB0.5 million and increase in manpower costs by RMB0.1 million for managing finances and administration for Chain stores and establishment our operations in Beijing.

R&D related expenses mainly consist of salary and benefits, material and consumables and other expenses to carry out R&D activities. The increase in R&D expenses was mainly due to increase in salary and benefits costs by RMB0.2 million to expand our expertise team and increase in cloud server service by RMB0.3 million. R&D related expenses are included in general and administrative expenses in the income statement.

Other (income) expenses, net consist of foreign currency exchange (gains) losses, government subsidies, bank charges, and other miscellaneous items, including provision of loss on equity method investment of RMB0.1 million in 2024, and lease income of 3D camera equipment of RMB0.03 and RMB0.2 million in 2024 and 2023, respectively.

Income tax expenses (benefits)

Income tax benefits was RMB0.2 million and RMB0.3 million for year ended December 31, 2023 and 2024, respectively.

Net loss

As a result of the above, net loss was RMB6.6 million (US$0.9 million) for the year ended December 31, 2024 compared to net loss of RMB5.5 million for the year ended December 31, 2023.

Liquidity and Capital Resources

We incurred net loss of RMB6.6 million and RMB5.5 million for the years ended December 31, 2024 and 2023, respectively. Working capital deficits were RMB13.7 million and RMB10.7 million as of December 31, 2024 and 2023, respectively. Our future sustainability is dependent on our capacity to generate cash from our operational endeavors and secure additional capital to fund our ongoing activities. Should we fail to secure necessary funding, we may be unable to realize our assets and discharge our liabilities in the normal course of business.

Our recurring operating losses are attributable to business development initiatives and product upgrades, which has concluded gradually in September 2024. Our new product lineup includes a next-generation 3D photo booth, 3D printed figurines, and 3D relief models, all slated for release in 2025. Our new product lineup is considered “next-generation” for reasons outlined as follows:

Next-Generation 3D Photo Booth (H9-3D): This is a completely redesigned 3D photo booth that is fundamentally different from our previous model in its structure, hardware, and imaging technology. For example, the H9-3D features a 12-sided frame that is approximately 90% lighter than the prior generation (about 80 kg in total weight) and can be assembled in roughly 40 minutes (down from about 2 hours). It also incorporates higher-resolution camera modules (each image contains ~70% more pixels than before) for significantly improved image quality. Moreover, the H9-3D utilizes a new 3D reconstruction engine built on our GSplat technology instead of the photogrammetry method used in the older booth. This next-generation engine enables high-quality 3D captures using fewer camera angles and lower computing power, and it eliminates the need for structured light during image capture. As a result, the photo booth can capture subjects more quickly and is better able to handle slight movements by people or pets during the session (a limitation that affected the prior structured-light system). Because these changes constitute a comprehensive redesign rather than incremental improvements, we refer to the H9-3D system as a “next-generation” 3D photo booth.

3D Relief Models (3D Badges): The 3D relief model (badge) is a new product category that differs markedly from our traditional 3D figurines in form factor and production process. In the realistic version of this product, a customer’s full-body image is captured in our 3D photo booth and reconstructed into a semi-3D relief using the GSplat-based engine. The software then automatically trims the 3D model and attaches it to a circular badge base, matching the base’s colour to the subject’s image for a cohesive appearance. We also offer a cartoon-style (or “Q-version”) 3D relief badge that can be created from a single 2D photograph provided by the customer, with no physical 3D scan required. In this process, an AI-driven algorithm first converts the customer’s 2D photo into a stylized cartoon image, and then our GSplat-based reconstruction engine generates a 2.5D relief model from that image. The introduction of these 3D relief badges employs new technology and workflows (including AI image stylization and novel 3D reconstruction techniques) that expand our product offerings beyond the existing figurine models. For this reason, we include the 3D relief models as part of our “next-generation” lineup.

New-Generation Small-Scale 3D Printed Figurines: We have extended our 3D printed figurine product line by adding miniature figurine options in sizes as small as approximately 4 cm in height (previously, our smallest figurines were about 9 cm tall). Producing high-fidelity figurines at these reduced dimensions required the development of entirely new post-processing workflows and data preparation standards. For instance, at 4 – 8 cm sizes, fine features of the figurines (such as arms, hands, and fingers) are extremely small in diameter, so we implemented new support removal, sanding, and polishing techniques to avoid damaging these delicate parts while still achieving a smooth finish. In addition, we established new model cleanup and optimization protocols before 3D printing to preserve detail and ensure the best quality output at the miniature scale. These enhancements — both in available product sizes and in the underlying production process — represent a significant advancement of our figurine line. Accordingly, we describe the miniaturized figurines (and their associated production innovations) as a “new generation” of 3D printed figurines.

In parallel, our business development strategy is centered on expanding our network of overseas chain stores and strengthening our relationships with B2B clients. However, the decline in working capital from 2023 to 2024 raises substantial doubt about our ability to meet obligations due within one year after the issuance of our financial statements.

We primarily rely on net proceeds from capital contributions and borrowings from banks and other unrelated sources to fund our operations and capital needs. We plan to increase bank loans by up to RMB10 million, with corresponding interest payable. In 2025, we intend to seek additional equity investment, including IPO proceeds from the public market.

Currently, we are focusing on increasing and stabilizing our production capacity. To achieve this, we have entered into long-term strategic cooperation agreements with 3D printer suppliers, with plans to add 4 to 12 printing devices per year from 2025 to 2027. While ensuring robust production capacity, we plan to increase our chain store network, aiming to add 100 new chain stores in 2025, including 40 overseas stores and 60 domestic ones. As of the date of this prospectus, we receive around 700 inquiries per month for cooperation and we have established connections with 9 toy stores and 13 photography stores hoping to purchase equipment from us. We will focus on developing our connections with enterprise clients in 2025. In the subsequent years, we will continue to invest based on the number of effective chain stores to further increase store numbers, including the purchase of 4 sets of 3D printers in 2025 with estimated costs of RMB 23,000,000. Furthermore, we are actively developing new business lines, such as the Cartoon IP business. We anticipate launching new products featuring well-known cartoon IPs by 2027.

Looking ahead, we anticipate significant growth in our sales revenue, which we anticipate will generate substantial cash flows. This growth in sales is driven by robust market demand for our products and services, combined with our strategic plans to expand our market reach and diversify our product offerings. We expect that we will generate post-tax cash inflows starting from the year ending December 31, 2026.

Here are key assumptions supporting robust market demand and successful strategic plans:

•        Industry and Marco environment:    Our projections are underpinned by the anticipated growth of the 3D printing industry, which is expected to expand significantly in the coming years. This growth is driven by ongoing technological advancements, increasing adoption across diverse sectors such as healthcare, automotive, and consumer goods, and a rising demand for customized and on-demand manufacturing solutions. Specifically, the market for 3D printed artistic and decorative items, including relief models, is expanding, fueled by consumers’ desire for unique, personalized products. These market dynamics, as detailed in our “Industry Overview” section, provide a solid foundation for our growth expectations.

•        Execution capacity and client validation:    Since the second half of 2024, we have achieved remarkable growth and received positive market feedback following the launch of new products and strategic business development initiatives. We have established 27 chain stores worldwide, marking a 92.8% increase from the first half of 2024, demonstrating our ability to expand our global footprint effectively. Additionally, we have experienced a 30% rise in inquiries for business collaborations and have generated leads for opening new chain stores, driven largely by the successful introduction of our next-generation 3D photo booth and 3D relief models. To meet the growing demand, we have purchased one new 3D printer and plan to acquire four more in 2025, which will double our printing capacity. Furthermore, our B2B client base has expanded by 174%, significantly enhancing the diversity and stability of our revenue streams.

•        Timing and schedule:    We have maintained our product development timeline, successfully releasing our next-generation 3D photo booth in the latter half of 2024. By the end of 2024, we completed the testing phase for our 3D relief models and planned to initiate their market launch in the third quarter of 2025. Our pipeline of new products, including 3D printed figurines based on popular cartoon series and intellectual properties, is progressing as planned, with development and testing on schedule. Furthermore, our capacity expansion strategy includes the purchase of three additional 3D printer machines in 2025, aimed at doubling our current printing capacity to meet anticipated demand.

Our projections are grounded in a combination of favorable economic conditions, industry trends, and our strategic capabilities. We remain vigilant about potential risks and are committed to mitigating them to ensure long-term growth and stability.

By leveraging our competitive advantages, such as proprietary technologies and extensive data reserves, we are poised to capitalize on emerging market opportunities and achieve substantial revenue growth. We remain confident in our ability to navigate through these financial challenges and secure our long-term stability and growth.

Cash, Cash Equivalents and restricted cash

The following table sets forth certain historical information with respect to our statements of cash flows:

We had cash and cash equivalent of approximate RMB0.4 million and RMB0.7 million as of December 31, 2023 and 2024, respectively.

Operating activities

Net cash used in operating activities was RMB8.5 million (US$1.2 million) for the year ended December 31, 2024 as compared to RMB4.7 million for the year ended December 31, 2023. The decrease was mainly due to the net loss incurred in 2024 and prepaid IPO expenses of RMB4.4 million.

Investing activities

Net cash used in investing activities for the year ended December 31, 2024 was RMB0.6 million (US$0.1 million) as compared to net cash used in investing activities of RMB0.3 million for the fiscal year ended December 31, 2023. Cash used in the year ended December 31, 2024 were for mainly equity investment in Xiamen Hewa and payments for property and equipment and intangible assets.

Financing activities

Net cash provided by financing activities for year ended December 31, 2024 was RMB9.4 million (US$1.3 million) as compared to RMB5.1 million for the year ended December 31, 2023. The cash inflow was mainly attributable to capital contribution from shareholders of RMB0.8 million, loans obtained from bank of RMB4.4 million, shareholders’ loans of RMB3.5 million, and loan from third parties companies of RMB1.2 million. Loans from shareholders are interest free. Loans from third parties companies are repayable within 6 to 12 months upon the Company’s successful completion of IPO.

Details of cash inflow — loans from bank and third parties are as following:

As of December 31, 2024, the balance of principal and interest payable of loans from bank and third parties are as following:

Contractual Obligations

In August 2022, the Company entered into lease agreement with Xiamen Yingsheng Textile Technology Co., Ltd. (“Yingsheng”). Yingsheng agreed to lease warehouse located in Huli District of Xiamen to the Company, for a term of 2 years, with an annual rental payment of approximately RMB22,000 (US$3,060). The lease was renewed and extended for additional 2 years in July 2024. The lease was terminated in November 2024.

In August 2022, the Company entered into a lease agreement with Yingsheng. Yingsheng agreed to lease office suites located in Huli District of Xiamen to the Company, for a term of 2 years, with an annual rental payment of approximately RMB309,393 (US$43,041).

In March 2024, the Company entered into supplementary agreement with Yingsheng and modified the original office suites lease contract effective since August 2022. Total lease amount reduced from RMB27,072 per month (US$3,766) to RMB17,353 per month (US$2,414) effective from March 2024 to July 2024. The lease came to an end in July 2024.

In September 2022, the Company entered into a lease agreement with Yingsheng. Yingsheng agreed to lease warehouse located in Huli District of Xiamen to the Company, for a term of 2 years, with an annual rental payment of approximately RMB28,800 (US$4,006). The lease came to an end in September 2024.

In April 2023, the Company entered into a lease agreement with Yingsheng. Yingsheng agreed to lease office suites located in Huli District of Xiamen to the Company, for a term of 2 years, with an annual rental payment of approximately RMB319,975 (US$44,513). The lease was renewed and extended for additional 1 year and 3 months in July 2024.

In November 2023, the Company entered into a lease agreement with Guangcai. Guangcai agreed to lease factory workshop located in Huli District of Xiamen to the Company, for a term of 1 year, with an annual rental payment of approximately RMB143,361 (US$19,943).

In December 2023, the Company entered into a lease agreement with Guangzhou HI Lifestyle Co., Ltd. (“HI Lifestyle”). HI Lifestyle agreed to lease a department store counter located in Tianhe District of Guangzhou to the Company, for a term of 1 year, with an annual rental payment of approximately RMB345,600 (US$48,077). The lease came to an end in December 2024.

In December 2024, the Company entered into a lease agreement with “HI Lifestyle”. HI Lifestyle agreed to lease a department store counter located in Tianhe District of Guangzhou to the Company, for a term of 1 year, with an annual rental payment of approximately RMB345,600 (US$48,077).

In July 2024, the Company entered into a lease agreement with Xiamen Sanzheng Xingye Industry and Trade Co., Ltd. (“Sanzheng”). Sanzheng agreed to lease workshop located in Xiamen Torch High-tech Zone to the Company, for a term of 2 years, with an annual rental payment of approximately RMB286,817 (US$39,900).

Finance lease

The Company entered into a lease agreement with Zhuhai Sailner 3D Technology Co., Ltd (“ZSTC”) on April 27, 2023, to lease 3D printers (“Leased Equipment”) for a lease term of one year. At the end of the lease term, the ownership of the Leased Equipment is transferred to the Company. The Leased Equipment in amount of RMB 1.55 million was recorded as right of use assets and the net present value of the minimum lease payments was recorded as lease liability and calculated with incremental borrowing rate of 6.58% per annum and stated at RMB1.39 million at the inception of the lease on April 27, 2023.

The Company made payments due according to the schedule. As of December 31, 2024 and 2023, the balance of Leased Equipment net of amortization was nil and RMB1.45 million, respectively. The lease liability was nil and RMB0.47 million, which is recorded as current liability as of December 31, 2024 and 2023.

INDUSTRY OVERVIEW

The information presented in this section has been derived from an industry report and commissioned by us and prepared by Frost & Sullivan, an independent research firm, to provide information regarding our industry and our market position. Neither we nor any other party involved in this offering has independently verified such information, and neither we nor any other party involved in this offering makes any representation as to the accuracy or completeness of such information. Investors are cautioned not to place any undue reliance on the information, including statistics and estimates, set forth in this section or similar information included elsewhere in this prospectus.

Brief Introduction of 3D Portrait Photography Market

Definition

A 3D portrait is a three-dimensional representation of a person or object, created using advanced technologies such as multi-angle photography, 3D scanning, or 3D modeling software. Unlike traditional 2D images, a 3D portrait captures depth, allowing for a realistic and lifelike depiction of the subject. The resulting model can be viewed and interacted with in virtual environments or produced as a physical object using 3D printing, providing a fully immersive or tangible experience.

Value Chain

The upstream segment consists of hardware and software suppliers, providing essential 3D scanners, cameras, and modeling/rendering software. These technologies form the foundation for the midstream and downstream activities by enabling high-precision data capture and processing. The midstream segment includes 3D photography companies and data processing services that handle capturing, modeling, and refining 3D portraits. They use upstream technologies to create and optimize 3D models, preparing them for final output. The downstream segment involves the application of 3D portrait technology across various industries such as personalized consumer products, film effects, and game character modeling. This stage focuses on delivering the final 3D output to meet market demands in different sectors.

Core Technology

High-precision 3D scanning is essential for accurately capturing detailed shapes, textures, and dimensions of objects and people. It involves using advanced scanning technologies, such as matrix camera systems, to ensure consistent data collection and reconstruction. In traditional methods like handheld scanners or rotating platforms, even minor movements can lead to mismatched data and lower-quality results.

The matrix camera 3D scanning system overcomes these challenges by capturing multi-angle images simultaneously within milliseconds. This method minimizes discrepancies caused by subtle movements and ensures all images are perfectly aligned, making it the ideal solution for high-quality 3D reconstruction in dynamic scenarios such as human and pet scanning.

Overview of Global 3D Portrait Photography Market

Market Size

The global 3D portrait photography market is currently in its early stages. However, the market size is projected to rise from USD15.8 million in 2023 to USD416.4 million by 2028, reflecting an impressive compound annual growth rate (CAGR) of 92.4%. This exceptionally high growth rate is largely attributable to the market’s current low base, as penetration remains limited across both consumer and commercial segments. Starting from this small scale, even modest increases in adoption, store deployment, and awareness can translate into substantial percentage growth, a pattern commonly observed in other early-stage, technology-driven industries. This surge in market value is driven by growing consumer interest in personalized digital and physical experiences, enabled by advancements in 3D imaging, AI-powered modeling, and the integration of these technologies into consumer-friendly platforms. The development of innovative products, such as digital photo frames displaying personalized virtual images and high-quality 3D-printed figurines, is further propelling market expansion. As consumers increasingly seek unique ways to commemorate significant life events and capture personal memories, the demand for both digital and physical 3D portrait solutions continues to grow rapidly.

Source: Frost & Sullivan

Market Drivers

Rising Demand for Personalization.    The increasing demand for personalization is driving the growth of the 3D portrait photography market from multiple angles. As consumers seek unique and custom experiences, 3D portrait photography offers highly individualized products, such as custom figurines and virtual avatars, enhancing emotional connections to these items. The flexibility of 3D technology enables rapid customization across various industries, from entertainment to healthcare, where personalized 3D portraits can be used in immersive experiences or for medical modeling. Furthermore, advancements in 3D scanning and printing technology make it easier for businesses to offer scalable customization services both online and offline, expanding market accessibility. These factors collectively position personalization as a key catalyst for innovation and market growth in the 3D portrait photography industry.

Technological Advancements.    Technological advancements are a key driver of the 3D portrait photography market. Improvements in 3D scanning and modeling have significantly enhanced accuracy and processing speed. Modern structured light scanning can capture detailed 3D data in seconds, compared to earlier methods that took minutes or hours. This not only reduces operational costs but also increases market scalability. The global 3D scanning market is projected to grow from $4.7 billion in 2021 to $6.8 billion by 2026. Additionally, the rise of VR and AR technologies has further boosted 3D portrait photography, creating realistic models for virtual games, fitting rooms, and telemedicine. By 2030, the economic impact of VR and AR is expected to reach $1.5 trillion, with a significant reliance on 3D technologies. These advancements continue to drive the rapid expansion of 3D portrait photography across industries.

Demand from Medical and Educational Sectors.    The demand from the medical and educational sectors is a key driver of growth for the 3D portrait photography market. In healthcare, 3D portrait photography enhances surgical planning and custom prosthetics, providing highly accurate, personalized models that improve patient outcomes. In education, 3D portrait technology is widely used in fields such as art, history, and design. For example, 3D scanning creates precise replicas of sculptures and historical artifacts, allowing students to engage with cultural heritage more deeply. As the global medical 3D printing market grows, reaching $7.9 billion by 2030, 3D portrait photography is becoming an essential tool not only in personalized medical devices but also in innovative educational applications across various fields.

Assumptions for the Data Mentioned Above:

The projection is made under the overarching assumption of a stable political environment and sustained economic growth globally. Based on this premise, the following specific assumptions were adopted to support the projected data:

1)      Comparative benchmarks:    The expected growth trend reflects performance observed in comparable sectors such as 3D scanning and AR/VR asset generation, which similarly exhibited exponential growth during early development stages. These sectors were selected because they share core technologies, workflows, and market drivers with the 3D portrait photography industry, including the creation of three-dimensional digital assets from real-world subjects for use in entertainment, gaming, virtual social interaction, and cultural preservation. They also benefit from similar technological advancements in computer vision, AI-based rendering, and hardware cost reduction. In addition, global interest in digital avatars continues to rise, driven by the increasing adoption of immersive virtual platforms, online social engagement, and personalized digital identity creation, which further supports the relevance of these benchmarks for projecting the market’s growth trajectory.

2)      Advancement in technologies:    Continued innovations in 3D imaging, AI-powered reconstruction, cloud-based rendering, and content delivery systems are expected to significantly reduce costs and improve accessibility.

3)      Demand from digital content and creator economy:    Increasing global interest in digital avatars, virtual identity creation, and content personalization continues to drive strong demand for 3D solutions, including 3D scanning, 3D printing, 3D portrait, etc.

4)      Low base and early-stage market:    The industry is currently in the early adoption phase with limited market penetration. The low initial base enables a high growth rate over the forecast period as the market scales.

Future Trends

Integration with VR/AR.    As 3D portrait photography evolves, its integration with digital avatars in virtual reality (VR) and augmented reality (AR) is becoming a key trend. According to Augmented Reality for Enterprise Alliance (AREA), the global VR/AR market is expected to reach $1.5 trillion by 2030, driven by increasing demand for immersive experiences across entertainment, social media, and e-commerce. This growth creates a significant need for hyper-realistic digital avatars, which rely heavily on 3D portrait photography to accurately capture and recreate human likenesses. In virtual environments, 3D portrait photography enables users to create lifelike avatars for use in gaming, virtual meetings, and social platforms. As consumers engage more in virtual worlds, the need for personalized, realistic digital representations grows, allowing users to interact more authentically. Moreover, virtual fashion and e-commerce are using digital avatars for virtual try-ons and personalized shopping experiences, further boosting engagement. As the VR/AR market expands, the demand for high-quality 3D digital avatars will continue to rise, positioning 3D portrait photography as a crucial technology in shaping the future of digital identity and virtual interaction.

Computational Photography.    Computational photography is rapidly emerging as a key future trend in 3D portrait photography. This technology leverages advanced algorithms, artificial intelligence (AI), and machine learning to enhance and optimize the process of capturing, processing, and rendering images. In 3D portrait photography, computational techniques can improve image quality, reduce noise, and enhance details in low-light or challenging environments. By integrating computational photography, the 3D capture process can become faster and more accurate, allowing for higher-resolution models with fewer errors in facial features and textures. AI-driven algorithms can also automate parts of the modeling and rendering workflow, reducing the need for manual intervention, and speeding up the production of lifelike 3D models. Furthermore, computational photography enables the blending of multiple images or sensor data to create more dynamic and realistic 3D portraits, enhancing the final output for applications in virtual reality (VR), augmented reality (AR), and other immersive environments. As this technology continues to evolve, it is set to play a pivotal role in shaping the future of 3D portrait photography, offering greater efficiency, improved quality, and new creative possibilities.

Overview of 3D Portrait Photography Market in the PRC

Market Size

The 3D portrait photography market in the PRC is still in its early stages but is poised for rapid growth in the coming years. The market size of 3D portrait photography in the PRC is expected to increase significantly from USD5.3 million in 2023 to USD162.0 million by 2028, with a remarkable compound annual growth rate (CAGR) of 98.2%. This high growth rate is partly due to the market’s current low base, where limited penetration means that incremental adoption can translate into substantial percentage increases. This rapid expansion is driven by several key factors, including the growing consumer demand for personalized and meaningful experiences, particularly among younger generations, and the development of products such as digital photo frames and other digital memorabilia, alongside traditional physical formats like statues. Additionally, advancements in 3D imaging and AI-driven modeling technology have made the process of creating highly detailed and lifelike 3D portraits more accessible and efficient. Government support for cultural and creative industries also plays a significant role in encouraging innovation and investment in this sector, further accelerating the adoption of 3D portrait photography services across various segments.

Source: Frost & Sullivan

Assumptions for the Data Above:

The projection is made under the overarching assumption of a stable political environment and sustained economic growth in the PRC. Based on this premise, the following specific assumptions were adopted to support the projected CAGR for 3D portrait photography market in the PRC:

1)      Policy support and ecosystem development:    National and local governments in the PRC have introduced supportive policies to encourage the development of digital content, digital humans, and immersive experience industries, in which 3D portrait photography is considered an enabling infrastructure. Polices include Guiding Opinions on Promoting the Innovative Development of the Digital Human Industry (2022), Shanghai Action Plan for Promoting the Innovation and Development of the Digital Human Industry (2022 – 2025), Hangzhou’s Implementation Plan for Supporting the Innovation and Development of the Metaverse Industry (2023), etc.

2)      Rising consumer demand for personalization:    The PRC’s young consumer demographic shows strong willingness to pay for customized, expressive digital content, which supports long-term demand for 3D-based imaging solutions.

3)      Cost reduction and domestic technological progress:    With improvements in domestic 3D hardware production and AI algorithm optimization, the overall cost of 3D portrait photography continues to decline, enhancing affordability and scalability.

BUSINESS

OVERVIEW

We are the leading 3D portrait photography service provider in China with a 34.0% market share in terms of revenue in 2023, according to the Industry Report. With our proprietary full-stack 3D photography technologies and strong AI data processing capability, we offer 3D photography printing equipment and booths to our business customers who in turn sell 3D portraits, life-like figurines and miniature landscapes to end users, both under our proprietary brands as well as the customers’ own brands.

We provide holistic 3D portrait photography solutions to our business customers. We help our customers set up and operate local stores and kiosks that sell 3D portraits to end users, and generate the majority of our revenue from the service fees we charged. The services we provide include equipment sales, booth setup, software licensing, and customized model processing. In 2022 and 2023, we generated service revenue from 6 and 20 business customers, respectively. We generated the majority of our revenue in China in 2022 and 2023, but have been developing a growing international presence, including Australia, Saudi Arabia and South Korea. In 2022 and 2023, revenue generated outside of China accounted for 3% and 15.6% of our total revenue in the same years, respectively.

We have designed and developed all the core hardware and algorithms required to produce our products, including our 3D photography booths, 3D human body reconstruction algorithm, 3D color management algorithm, AI portrait restoration algorithm and store management SaaS software. We have an R&D team that focuses on the innovation and optimization of our key technologies and algorithms in order to improve fidelity of our products and reduce production costs, in particular our expenditure on store equipment and production. Our 3D photography services are supported by portrait data restoration algorithms and benchmarked against our 3D printing production standards, which are updated based on customer feedback.

We have launched the “Suwa” and “Sharewow” brands in the domestic and overseas markets, respectively, for our 3D portrait end products. We promote our 3D portrait end products mainly through online media platforms and word of mouth. We produce online media contents in-house as well as selectively engage KOLs to promote our end products. We also participate in offline sales and marketing events. We were selected as the 3D photography service provider for the 22nd World University Games in 2023, customizing 3D portraits and related products for the event. We were also invited to participate in the 23rd China Internet Conference in 2024, which we believe is an indication of the recognition of our leading position in the 3D portrait photography service market.

We generated revenue of RMB12.7 million and RMB14.1 million in 2023 and 2024, respectively. Our gross profit was RMB4.4 million and RMB5.3 million in 2023 and 2024, respectively, representing gross profit margin of 34.6% and 37.7% in the same periods. We incurred net loss of RMB5.7 million and RMB6.9 million in 2023 and 2024, respectively.

OUR STRENGTHS

The leading 3D portrait photography service provider in China with first-mover advantage

We are the leading 3D portrait photography service provider in China with a 34.0% market share in terms of revenue in 2023, according to the Industry Report. In addition, we commenced our business in 2016 and were one of the first movers in the 3D portrait photography market in China according to the Industry Report. We were able to quickly establish a commanding market position by leveraging our proprietary full-stack 3D photography technologies and strong AI data processing capability.

Leveraging our position as both a first mover and market leader in a relatively new market, we were able to set certain key industrial technological and operational standards, including raw material selection, key product parameters such as size, mesh and texture, production procedures and retail price. We believe such capability enhances our competitive advantage over existing market participants and establishes entry barrier for potential new participants.

3D portrait is an innovative and the newest offering to consumers’ ever-presenting demands for memorials and souvenirs. With the advance of AI such as body reconstruction algorithms, the market for 3D portraits is expected to expand further in the foreseeable future. According to the Industry Report, the 3D portrait photography service market is expected to grow from US$5.3 million in 2023 to US$162.0 million in 2028, representing a CAGR of 98.2% over the period. We are a forerunner and the leading participant in this fast-growing market, and we believe we are well-positioned to leverage our current market position to take advantage the growth potential and further expand our market shares.

Global store network with diversified product offerings that serve different needs of business customers

We adopt a business model that serves business customers in order to quickly expand our reach to end users in a cost-efficient manner. Our main customers are business owners and entities that sell our 3D portraits to end users. As of December 31, 2024, we had customers in 20 provinces in mainland China and nine countries across the globe, including Australia, Saudi Arabia and South Korea.

Service revenue from customers who operate local stores or kiosks that sell our 3D portraits accounted for the majority of our revenue in 2023 and 2024. We provide holistic business solutions to such customers. We provide pre-sale consultations to potential customers to help them select store location and make operation plans. We sell equipment to and set up 3D photography booths for customers at their locations and provide necessary training. Once image data of an end user is collected, we handle the model building and refinement and 3D portrait printing and product delivery. We are committed to offering end users excellent shooting experience through a series of standardized processes and innovative technological solutions. We have implemented a complete set of standard operating procedures to ensure that end users receive personalized, efficient and professional services with end products that meet their expectations. According to our SaaS management system records, the complaint rate of our 3D portraits is less than 2%. We also generate sales revenue from customers who purchase our equipment.

We believe this business model enables us to quickly build up market presence and expand market share without significant investment in sales and marketing expenses. As a result, we are able to focus our financial and human resources on research and development, which further enhances our competitive strength.

Effective cost control and operation optimization

The 3D portrait photography industry is still in the early development stage and as such a matured supply is yet to materialize. We participate in key stages of the supply chain including raw material procurement, 3D photography booth design and setup, and 3D portrait production. We entered into long-term strategic cooperation or multi-year supply agreements with key suppliers, including suppliers for printing raw materials and printer components and cloud-based computing service providers. We process image data collected by our business customers from end users who place the order and print and deliver the 3D portraits to end users directly.

We believe participation in keys stages of the supply chain is critical to our success in the current stage of industrial development, as it gives us the abilities to:

•        guarantee stable supply, as the ability to procure raw materials in quantity from reliably suppliers is critical to achieving the initial stage of commercial viability;

•        ensure product quality, as raw material quality, data processing and model building and 3D printing are all key elements that determine the final product quality;

•        effective deficiency identification and optimization, as possessing information of the full life-cycle of a product enables us to quickly pinpoint deficiency and design effective optimization, which is essential in improving product quality and maintaining user satisfaction; and

•        cost transparency, as our in-depth knowledge of the supply chain gives us cost transparency, which in turn enables us to price our products based on both cost and demand information.

In addition, we believe our market-leading position enhances our bargaining power with suppliers, which further reduces our operational costs and increases our profit margin.

Advanced proprietary algorithm and data processing and analysis capacity

3D portrait printing is a highly data-intensive process. To ensure fidelity in color, texture and features of our 3D portrait products, we have developed proprietary AI-enhanced algorithms for data collection, 3D model building and model repair and refinement.

Our research and development efforts focus on reducing data collection needs while improving the capability and efficiency of model building and refinement. Our second-generation 3D photography booth requires only 26 image data collecting cameras, as compared to 82 cameras in the first-generation booth. As we continue to enhance our hardware and software, we aim to improve our cost efficiency by further reducing the number of cameras required per photography booth. The adoption of our SaaS management system has streamlined store operations. Our automatic texture balancing algorithm and QR code sorting system also expedite the manufacturing process. We have formulated around 100 production standards that form the basis of our rigorous quality control process, which is also aided by technology. Taking into account past data and the features of 3D printing, our algorithms can finetune and optimize products before they are printed, ensuring consistently high quality. As a result, the improvement in proprietary algorithms and technologies enables us to produce 3D portraits with higher quality from less image data.

Our advanced technologies provide us with tangible advantages over our competitors that lead to better end user experience and lower production cost. For example, compared to our competitors’ rotating 3D shooting platforms which take up to 10 seconds to rotate around the subject to collect necessary data, our matrix 3D studies can complete a 360° shooting in 0.1 seconds. As subjects such as babies and animals often move during the shooting process, our technologies enable to produce images of high quality that are less subject to motion blurring. Traditional rotating scanners use a video frame-capturing method to obtain images, but such cameras often have low frame rates, which can lead to frame dragging during the capture and ultimately affect image quality and reconstruction accuracy. Our product effectively addresses these challenges, showcasing our technological advantages.

Experienced management and research and development team

Our senior management members are responsible for designing and executing the business strategies which led to our quick growth. Our founder and director, Mr. Libin Kuang, possesses over 10 years of experience in the photography industry and has been instrumental in spearheading our growth. Mr. Kuang plans and executes our business strategies and manages key customer relationships, leveraging his deep connections in the industry. Prior to joining us, Mr. Kuang founded and managed a prominent photography brand for 7 years. Our co-founder, Mr. Shuxun Huang, has over 10 years of experience in product management, with particular expertise in product planning, design and process control. Mr. Huang oversees all aspects of our operations. Prior to joining us, he held senior operational management positions at various technology companies.

The core members of our research and development team have ample experience in relevant fields, including 3D modeling, AI deep learning and photography. Currently, our hardware research and development center is managed by two employees who specialize in developing the structural components of 3D imaging equipment. Our software research and development center is managed by 11 employees who work with a data annotation service provider and several technical consultants. The main areas of development include imaging, color calibration, 3D reconstruction and deep learning algorithms. Our Technical Manager, Mr. Shui You, has over 8 years of research and development experience. Mr. You is primarily responsible for leading the design and development of our hardware and software products, including 3D photography booths, modelling algorithms and online management systems. He previously worked at an artificial intelligence company and ecommerce company. Our 3D Modelling Manager, Mr. Shihai Cao, has over 9 years of experience in 3D modelling and has been recognized as an Expert in the Application of Digital Media by Xiamen Technician College.

OUR STRATEGIES

Invest in Research and Development

We plan to make further investments in research and development by focusing on two main areas: 3D photography booths and software algorithms. For example, our team is currently conducting research to improve stability and data processing capabilities, especially for ad-hoc events with high traffic. Smaller 3D photography booths for pets and materials are currently under development and improvements will be made to better replicate animal hair. We expect to launch such products by the fourth quarter of 2025.

We are continuously investing in the improvement of our software algorithms. Our 3D reconstruction algorithm leverages GSplat technology to optimize the quality of imaging data while lowering hardware costs. An improved version of our 3D reconstruction algorithm will be integrated into our SaaS system and we expect to commercialize it by the fourth quarter of 2025. 3D model repair and enhancement algorithms are also being developed to elevate the quality of our products. We also plan to launch related decorative products such as 3D photo albums and mobile applications that allow end users to generate cartoon versions of human subjects by taking photos with their mobile phones. The development of a 3D photo album prototype has been completed. We expect to launch cartoon versions of our products by the second quarter of 2026. In the long term, we hope that our technological innovation can enhance the quality of our products and services as well as minimizing manpower and computing power costs.

We also plan to further expand our research and development capabilities, including but not limited to: 1) establishing an algorithm research and development center in the United States after the completion of our initial public offering; 2) developing photosensitive resin suitable for full-color 3D printing and seeking out better printing materials suppliers to reduce our materials costs; 3) collaborating with 3D printer suppliers to customize and develop printers specifically designed for 3D portrait printing, and exploring investment opportunities in and/or acquiring upstream suppliers of 3D printing equipment and consumables and related technology to ensure stability in our supply chain. We are currently discussing the technical requirements and the terms of collaboration with 3D printer suppliers in China. Customized 3D printers are expected to be launched by the fourth quarter of 2025.

Expand Store Network and End User Reach

As of December 31, 2024, we had 51 Franchise Stores covering 30 cities in mainland China under the “Suwa” brand and seven countries overseas under the “Sharewow” brand, including three Franchise Stores in Mexico, two Franchise Stores in each of Australia and Malaysia, as well as one Franchise Store in each of Singapore, Peru, Spain, the United States. We plan to expand our global market reach by exploring opportunities in additional countries and increase coverage of outlets in mainland China through a combination of Customer-brand Stores and Self-operated Stores. For oversea markets, we plan on working with clients in developed countries and areas of Europe, Asia and North America, such as Japan, Canada, the United Kingdom and France, to open around 30 stores as well as selling 30 sets of H9 AI 3D Photo Booth (“H9”) or SWFG-1 Square 3D Photo Booth (“FG”) equipment in 2025. For mainland China markets, we plan on working with clients in first-tier and second-tier cities, such as Beijing, Shanghai, Guangzhou and Shenzhen, to open around 30 stores as well as selling 30 sets of H9 or FG equipment in 2025. The detailed plan is as follows:

To meet the needs of end users in different geographical regions, we are designing new products based on the cultural characteristic of the places in which we operate. As part of our global reach efforts, we will also cooperate with industry peers to improve our technical and production capabilities and elevate the caliber of our industry as a whole. We also plan to diversify our product offerings to procure more end users. For example, while we currently mainly focus on high-fidelity 3D portraits of people, we are researching 3D portraits of pet animals and 3D cartoon avatars of people and animals.

Enhance Brand Building and Sales and Marketing Efforts

We aim to leverage our marketing leading position and cultivate a high-end brand that is distinguished by the quality of its products. We plan to further enhance our capability of catering to bespoke demands of end users in the high-end market segment. In addition, we plan to intensify our sales and marketing efforts to take advantage of the expected market growth. We plan to employ a combination of sales and marketing efforts, including KOL promotion, online and offline advertisements, and sponsorship of selected corporate or offline events.

OUR BUSINESS MODEL

Our business model consists of two segments: (i) franchising and (ii) sales of 3D photography equipment and related services. Franchising is currently our main revenue stream, but we are also actively developing the other business segment. The table below sets forth the revenue contribution of our business segments:

Franchising

Below is an overview of our franchising process:

(1)    Identify and target specific markets.    Through market research, we analyze the demand for 3D photography in different regions. Once our target markets are identified, we conduct a range of promotional activities on social media and at industry exhibitions to enhance the visibility of our brand. Customer service hotlines are also set up to address potential franchisees’ inquiries.

(2)    Approach potential franchisees.    Consultation sessions are organized so that we can better understand potential franchisees’ background, funding and motivations. Potential franchisees are in turn offered more detailed information on the franchising process and are invited to visit our headquarters and existing Franchise Stores.

(3)    Enter into franchise agreements.    We sign franchise agreements with franchisees, who are then required to pay relevant franchise, licensing and equipment fees.

(4)    Provide operational, marketing and other support.    We continue to support our franchisees by offering training in business development, store management and marketing.

We work closely with our chain stores. After 3D photography booths collect end users’ imaging data on-site, the corresponding 3D portraits are produced at our headquarters. Revenues derived from our chain stores include: (i) 3D camera equipment fees; (ii) 3D printed figurines; (iii) franchise and software licensing fees; and (iv) accessories for figurines. The table below sets forth the breakdown of our franchising revenues:

Our chain stores can be categorized into Franchise Stores and Customer-Brand Stores. Franchise Stores can be further categorized into the following groups: (i) Self-operated Stores run by our subsidiaries; (ii) stores jointly operated by us and our local partners; (iii) stores operated by our franchisees.

Franchise Stores under Our Brand

As of December 31, 2024, we had 51 franchise stores covering 30 cities in mainland China under the “Suwa” brand and seven countries overseas under the “Sharewow” brand. Our franchise stores are usually located in shopping malls and office buildings. As the rent and operating costs for these locations are usually high, we have launched service points in high-traffic areas under a network model from which consumers may browse and place orders of our services. The cost of running such service points could be as much as 75% lower compared with a typical franchise store. A typical franchise store requires the rental, decoration and improvement of a storefront in shopping malls and office buildings as well as adequate staff, while the network model of service point only requires moderate space to set up the new H9 AI 3D photo booth, which costs around half the price of the original model. For example, a sports gym or pet store could purchase our H9 AI 3D photo booth to provide additional 3D photography services to customers. In this case, the sports gym or pet store would only need to invest in a set of H9 AI 3D photo booth and a few display samples. On average, the initial cost of opening a Franchise Store amounts to approximately RMB200,000 (including renovation and rent) with a monthly maintenance cost ranging between RMB30,000 to RMB50,000. If the market penetration rate of this new H9 AI 3D photo booth gradually increases, our network model would only require an initial cost of around RMB100,000, and given there are no monthly expenses for the salaries and rent, the monthly maintenance cost is negligible.

Self-operated Stores

We had one Self-operated Store as of December 31, 2024. The Self-operated Store is operated by our subsidiary and provided with 3D photography booths, store decorations, marketing materials and relevant training.

We plan to further expand our network of self-owned stores in first-tier and second-tier cities of the PRC.

Jointly Operated Stores

We form jointly operated stores through our subsidiary Xiamen Hewa Technology Co., Ltd. Under this model, we partner with local businesses to establish joint ventures. The equity contribution ratios may vary. In general, however, local partners are responsible for set-up costs and daily operations, whereas we provide technical equipment as well as store management support.

As of December 31, 2024, we had one jointly operated store under the “Suwa” brand in Xiamen and plan to further expand our network of jointly operated stores in first-tier and second-tier cities of the PRC.

Customer-Brand Stores

Customer-Brand Stores use and display the customers’ own logos but purchase our 3D photography booths and receive our operational support in terms of store management, 3D printing production and algorithms.

As of December 31, 2024, there were nine Customer-Brand Stores have been set up in mainland China and various other countries, including South Korea and Saudi Arabia. This business model allows us to reduce operating costs while sustaining a stable income stream from the sale of equipment as well as service fees.

Salient Terms of Franchise Agreements

We usually enter into standard franchise agreements with our franchisees. The salient terms of our standard franchise agreement are as follows:

(i)     The contractual term is usually three years and franchisees wishing to renew their franchise agreements must inform the franchisor three months in advance.

(ii)    Franchisees are bound by restrictions on the number of stores and the geographical areas they operate in. Certain franchise agreements may contain exclusivity provisions.

(iii)   Franchisees must make timely payments for all relevant fees.

(iv)   Franchisees must abide by brand standards and operating procedures stipulated by the franchisor.

(v)    The franchisor must provide appropriate management and technical support to franchisees.

(vi)   The franchisor must fulfill franchisees’ orders for 3D portraits and deliver products conforming to the agreed standards to the franchisees.

(vii)  Upon termination of the franchise agreements, franchisees must settle all outstanding fees within 15 calendar days and return all franchise materials to the franchisor within 30 calendar days.

The salient terms of our material franchise agreement are summarized below:

Franchise Agreement with YI SHU Limited Company

•        Term:    The contractual term is three years (January 5, 2024 to January 4, 2027). To renew the franchise agreement, the franchisee shall inform the franchisor three months in advance.

•        Obligations of the franchisee:    The franchisee shall open at least three stores in Taiwan and abide by brand standards and operating procedures stipulated by the franchisor.

•        Obligations of the franchisor:    The franchisor shall provide appropriate management and technical support to the franchisee and fulfill the franchisee’s orders for 3D portraits and deliver products conforming to the agreed standards to the franchisee.

•        Payments:    The total payment of RMB876,000 shall be settled in three installments: (i) RMB392,000 shall be payable seven days after the signing of the agreement; (ii) RMB192,000 shall be payable within six months after the franchisee receives the equipment and (iii) RMB292,000 shall be payable within one year after the franchisee receives the equipment.

•        Termination:    If the franchisee is in breach of its obligations under the agreement (e.g. it fails to settle the relevant fees in a timely manner, falsifies store data or refuses to be inspected by the franchisor) and fails to rectify the issues within ten days of the franchisor’s written notice, the franchisor may unilaterally terminate the agreement. If (i) the parties fail to agree on an extension of the agreement or (ii) a party ceases to exist by operation of law, the agreement shall be terminated immediately. Upon termination of the franchise agreement, the franchisee shall settle all outstanding fees within 15 calendar days and return all franchise materials to the franchisor within 30 calendar days.

•        Confidentiality:    Each party shall keep the trade secrets of the other party confidential except with the prior consent of the other party.

•        Dispute Resolution:    The parties shall resolve any disputes arising out of or relating to the agreement by negotiation. If the disputes cannot be resolved by negotiation within 30 days of the initiating party’s written notice, each party may submit the disputes to the jurisdiction of the court where the franchisor was incorporated.

Product Order Contract with Sharewow 3D (Singapore) Pte. Ltd.

•        Delivery:    The seller shall deliver the goods to the buyer within 15 days after the payment for the good has been fully settled. The seller shall bear the costs of the delivery of goods to the freight forwarder.

•        Payment:    The buyer shall fully settle the total payment of RMB239,950 within seven working days after the agreement has been executed.

•        Confidentiality:    Each party shall keep the trade secrets of the other party confidential except with the prior consent of the other party.

•        Dispute Resolution:    The parties shall resolve any disputes arising out of or relating to the agreement by negotiation. If the disputes cannot be resolved by negotiation, each party may submit the disputes to the jurisdiction of the court where the seller is located.

Sales of 3D Photography Equipment and Related Services

Below is an overview of our sales of 3D photography equipment and related services:

(1)    Identify and target specific customers.    Our sales of 3D photography equipment adopt a B2B model. Our Department of Political and Corporate Affairs is dedicated to sourcing and managing customers. Potential customers are offered pamphlets and video demonstrations that showcase the functions and advantages of our equipment.

(2)    Approach potential customers.    During consultations, our sales representatives assess customers’ needs and make product recommendations accordingly. We then negotiate the pricing, payment methods and after-sales services with customers.

(3)    Enter into final agreements.    We sign agreements with customers, who are then required to pay the relevant fees.

(4)    Deliver equipment and provide after-sale services.    We install and test the equipment and train customers’ technicians who will be operating the equipment. 3D portraits are produced at our headquarters and after-sales services are customized to address customers’ needs.

Our B2B model involves the provision of 3D photography equipment and customized technical services to government units and corporate customers. We have established business relationships with key customers, who bring a stable revenue stream. Our customers in this segment include businesses, government units, schools and hospitals. They may choose to purchase 3D photography booths and design materials to launch their own

production lines. We are also able to customize printing services catering to customers’ individual demands. The table below sets forth the breakdown of our revenues derived from the sales of 3D photography equipment and services:

OUR PRODUCTS

3D Photography Equipment

SWYG-1 Circular 3D Photo Booth

This is the first-generation 3D photo booth that was launched in early 2022. It is cylindrical in shape, bulky and relatively difficult to assemble or disassemble.

SWFG-1 Square 3D Photo Booth

The second-generation square 3D photo booth was launched at the end of 2022. Improvements were made in the following aspects:

•        Imaging:    The shooting distance between the cameras and the subject is shorter, which allows the cameras to capture the details of the subject more accurately.

•        Manufacturing costs:    Our technological innovation reduced the number of cameras needed from 90 to 82, significantly lowering production costs and allowing us to offer our products at more competitive prices.

•        Design:    The modularity of the 3D photo booth makes it much easier to assemble or disassemble, greatly improving the flexibility and mobility of the equipment.

H9 AI 3D Photo Booth

Our H9 AI 3D photo booth was launched in 2023 with the following improvements:

•        Shooting speed:    With a 0.01 second shooting speed, the H9 AI 3D photo booth can capture quality images for subjects prone to moving, such as children and pets.

•        Imaging:    The 3D photo booth is equipped with a Sony IMX2831 sensor. The high-end configuration can capture more light and detail, providing a vivid and realistic 3D output.

•        Design:    The modular design allows the equipment to be assembled or disassembled within 20 minutes for the convenience of our customers. Whether it is at an event site, commercial space or home environment, our 3D photo booth can be quickly deployed to provide users with 3D photography services.

3D Printed Figurines and Accessories

3D Printed Figurines

3D printed figurines are our main B2C product category at present. They are printed by full-color 3D printers and then polished by post-printing processes. 3D printed figurines are usually sold at fixed sizes: 9cm, 12cm, 15cm and 18cm. However, the size can also be customized based on end users’ requirements. Our algorithms can estimate end users’ real heights and adapt the dimensions of the portraits accordingly.

Product: baseball kid 3D printed figurines in different sizes

Digital 3D Portraits

Digital 3D portraits take the form of mesh 3D data. We have developed a WeChat application and a browser that end users can use to view 3D data. 3D data can also be displayed in augmented reality with the option to change backgrounds. As the hardware and software ecosystem for interactive experiences matures, we believe that the value of digital 3D portraits will overtake that of 2D photos in the future.

Product: a digital 3D portrait of a football player

Cultural relic restoration and miniature landscape

We collaborate with museums and cultural tourism groups to create physical products of miniature landscapes using our 3D modeling technology, assisting them in relic restoration and promoting cultural awareness.

Product: “LianHua Cave” miniature (1:15)
original site at Thousand-Buddhas Cliff in Sichuan Province

Accessories for Figurines

Related accessories include three series of miniature landscapes for decorating 3D printed figurines:

•        Display bases:    Text and images can be engraved on wooden display bases.

Product: mom & daughter ballet figurine with display base

•        Display covers:    Wooden bases and acrylic covers can be used to adorn 3D portraits, usually single-person models.

Product: little girl figurine with display cover

•        Display boxes:    Acrylic boxes with miniature landscapes can be used to display family or multi-person models.

Product: family portraits (left), one person in different costumes (right) with display box

Seasonality of Our Products

As our main retail products are souvenirs, the seasonality of our business is correlated with holidays and weekends, which are our peak sales periods. Peak travel seasons also increase footfall at our stores and are conducive to sales. In 2023, excluding statutory holidays, the average daily order volumes were 122 and 75 for weekends and weekdays, respectively.

We offer miniature landscapes specially designed for such peak sales periods, such as Christmas, Spring Festival and Children’s Day, and provide customized products according to end users’ individual needs. Holiday promotions also help to boost sales.

OUR SERVICES

Our services cover three areas: 3D printing, 3D portrait data repair and 3D model reconstruction.

Our 3D printing business relies on our production capabilities. Currently we have offered 3D printing services to a selected few clients. Although this business segment has not been fully rolled out yet, we expect it to become an important source of revenue for us as the market grows and we plan on rolling out the 3D printing services in the fourth quarter of 2025 in mainland China as well as oversea markets. We plan on developing a model in our existing

SaaS software so that our franchisee stores can help us expand our 3D printing business through existing channels. After the 3D printing capabilities are built into our existing SaaS software, our franchisees will be able to upload 3D printing orders directly into the system and monitor the printing and delivery process of each order.

Our 3D data repair business is supported by our portrait data restoration algorithm, which we plan to sell under a SaaS model to companies across the world.

Our 3D model reconstruction business leverages our reconstruction algorithm. We plan to commercialize the software and release it to the market for retail customers.

Currently our 3D data repair services and 3D model reconstruction services are still under development and yet to achieve commercialization. Our plan is to develop and integrate such services on a separate SaaS platform and API interface, available for our enterprise clients only.

We plan on rolling out our 3D data repair services and 3D model reconstruction services in the fourth quarter of 2025 or the first quarter of 2026.

PRICING

We have formulated pricing strategies that consider variations in consumption levels and market conditions. Dynamic pricing allows us to adapt to changing circumstances in local markets and maintain the price competitiveness of our products.

Franchising

Franchise and Related Fees

The set-up costs of Franchise Stores include a fixed brand franchise fee as well as fees for photography equipment and software usage. Franchisees in mainland China operate under our Suwa brand, whereas franchisees outside of mainland China operate under our Sharewow brand. Alternatively, customers may choose not to be a franchisee and operate under their own brands and only the equipment and software usage fees will be payable in this case.

The main factors that we consider in our pricing decisions include: (i) the value and reputation of our brands (for brand franchisees only); (ii) the level of support provided to franchisees (e.g. training, marketing and other resources); (iii) operational costs of our headquarters’ management and supervision of Franchise Stores; and (iv) the types of photography equipment chosen by franchisees and the associated delivery fees. If a chain store’s equipment needs to be customized, a higher fee will be incurred. We may also offer special discounts to long-term customers.

3D Printed Figurines Production

3D printed figurines are produced by our headquarters after chain stores collect end users’ imaging data. The prices of 3D printed figurines are recommended for our domestic Franchise Stores and are based on the following factors: (i) production and transportation costs; (ii) the prices of similar products in the market; (iii) our target gross profit margin and rate of return; and (iv) the sales channels (which may incur varying costs). Adjustments to the pricing of our 3D printed figurines may also be made for bulk orders, complex models, long-term customers and holiday promotions.

Franchise stores outside of mainland China and customers operating under their own brands can set retail prices based on their own observation of their markets. The portrait production fees payable to us are determined based on our costs, ensuring that we can achieve a reasonable profit.

Sales of Photography Equipment and Related Services

Our pricing of photography equipment is based on the following factors: (i) the market positions of customers; (ii) the scope of services (e.g. on-site technical support and design services) and (iii) the volume and types of equipment sold as well as the level of customization required. We adopt a dynamic pricing strategy that gives sales staff some degree of flexibility in negotiations with customers. Our pricing guidance also ensures that Franchise Stores in the vicinity are not disadvantaged.

3) comprehensive oversight of the order lifecycle and 3D printing tasks, ensuring transparency and efficiency while enhancing overall quality. Additionally, our system includes various supporting functions to further boost its effectiveness.

Color Management Algorithm

We have developed a proprietary color management algorithm. The color restoration of imaging models allows us to meet customers’ and end users’ expectations for personalized and high-quality 3D printing.

OUR STORE NETWORK

Our store network spans mainland China and seven countries in the world as of December 31, 2024:

OUR SUPPLIERS AND SERVICE PROVIDERS

Cameras are a key component of our 3D photography booths. We work with established suppliers that can customize cameras to meet our rigorous requirements for imaging accuracy and speed. The camera modules that we use not only have superior performance, but are also in stable supply due to the maturity of the domestic supply chain.

The control units play a crucial role in our 3D photography booths, coordinating and managing the operations of the entire booths. Sigle-chip microcomputers and our self-developed software are installed in the control units to achieve precise control of cameras and other hardware modules. The modular design of the control units allows us to upgrade individual components separately, providing flexibility.

3D portrait modelling relies heavily on data. Safe storage of data is therefore essential to our products and services. We typically store our imaging data on Alibaba Cloud, a leading cloud storage solution that can process large volumes of data. Our storage can also be scaled up according to our business needs.

For 3D model reconstruction, we adopt a hybrid model where large-scale and complex reconstructions projects are outsourced to domestic computing service providers and simpler reconstruction is performed by our mainframe computers locally. The computing service providers with which we partner are established and reliable, giving us more flexibility in resource allocation.

Since full-color 3D printing technology has not been popularized, the supply chain of 3D printers is relatively concentrated and we currently face the risk of having only one upstream supplier who we have worked with and tested. However, as the industry continues to grow, we expect the supply chain to gradually mature, thereby reducing our supply chain risks. We have entered into a strategic cooperation agreement with a new 3D printer supplier, and we

expect to purchase and test 3D printers from this new supplier. On the other hand, the market for printing consumables such as photosensitive resins is well-established and we are working with multiple suppliers with the ability to customize resins for our specific production needs. Salient terms of our material supplier contracts are as follows:

Letter of Intent with a Supplier of 3D Printers and Printing Ink

•        Term:    The contractual term is three years (July 1, 2024 – June 30, 2027).

•        Obligations of the supplier:    The supplier shall fulfill the purchaser’s orders for 3D printers and printing ink and deliver products conforming to the agreed standards to the purchaser.

•        Payments:    The unit price of 3D printing ink shall be no higher than RMB0.4/g (tax inclusive). The unit price of full color 3D printers shall be no higher than RMB400,000/set (tax inclusive). The purchaser shall settle the payment for each monthly order by the 15th of the next month.

•        Quality assurance:    The supplier shall ensure that the goods supplied conform to the requirements of the purchaser. If any goods are refunded or replaced, the supplier shall bear all related costs, including damages suffered by the purchaser

•        Confidentiality:    Both parties shall keep confidential the contents of the letter of intent except with the prior consent of the other party.

•        Dispute Resolution:    The parties shall resolve any disputes arising out of or relating to the agreement by negotiation. If the disputes cannot be resolved by negotiation, each party may submit the disputes to the jurisdiction of the court where the purchaser is located.

Purchase Agreement with Shenzhen Huaxing Shixun Technology Co., Ltd. dated July 9, 2024

•        Obligations of the supplier:    The supplier shall fulfill the purchaser’s orders for 3D photography booth cameras and deliver products conforming to the agreed standards to the purchaser.

•        Delivery:    Shipment shall be made within five calendar days after receipt of the full payment. The supplier shall bear the costs and risks of the transportation.

•        Payments:    The total payment of RMB500,000 shall be settled in two installments: (i) RMB150,000 shall be payable upon the supplier receiving the purchase agreement signed by both parties; and (ii) RMB350,000 shall be payable before shipment.

•        Confidentiality:    Both parties shall keep confidential the contents of the agreement except with the prior consent of the other party.

•        Dispute Resolution:    The parties shall resolve any disputes arising out of or relating to the agreement by negotiation. If the disputes cannot be resolved by negotiation, each party may submit the disputes to the jurisdiction of the court where the supplier is located.

Purchase Agreement with Shenzhen Huaxing Shixun Technology Co., Ltd. dated August 29, 2024

•        Obligations of the supplier:    The supplier shall fulfill the purchaser’s orders for 3D photography booth cameras and deliver products conforming to the agreed standards to the purchaser.

•        Delivery:    Shipment shall be made within five calendar days after receipt of the full payment. The supplier shall bear the costs and risks of the transportation.

•        Payments:    The total payment of RMB1,350,000 shall be settled in three installments: (i) RMB270,000 shall be payable upon the supplier receiving the purchase agreement signed by both parties; (ii) RMB405,000 shall be payable upon the purchase order; and (iii) RMB675,000 shall be payable before shipment.

•        Confidentiality:    Both parties shall keep confidential the contents of the agreement except with the prior consent of the other party.

•        Dispute Resolution:    The parties shall resolve any disputes arising out of or relating to the agreement by negotiation. If the disputes cannot be resolved by negotiation, each party may submit the disputes to the jurisdiction of the court where the supplier is located.

Retail Customers

Our self-owned and jointly operated stores interface directly with retail customers. Customers aged 23 – 30 and 30 – 40 are the largest groups, representing 28.79% and 68.74% of all customers, respectively.

COMPETITION

The 3D portrait photography market in the PRC remains in an early stage and is relatively concentrated. We currently compete with several leading players that focus on both 3D printing and modelling. In the future, we may also face competition from new entrants, consolidations of existing competitors or companies created through spin-offs of our larger competitors. For information in relation to the competitive challenges that we face, see “Risk Factors — Risks Related to Our Business and Industry — We participate in intensely competitive markets and we may not compete successfully against new and existing competitors, which may materially and adversely affect our results of operations.”

Our competitors in the market include QZOZ, who is engaged in the design and production of customized, lifelike figurines using advanced 3D portrait scanning and printing technology, Tomato IE MFG, who specializes in the design and production of 3D human models, as well as the sales and services of 3D intelligent scanning equipment, and Second Life Digital Technology, who focuses on the application of 3D and digital twin technology for various purposes including 3D-printed figure.

Having entered the 3D portrait photograph market earlier than most of our competitors, we believe that our competitive advantages are our first-mover advantage, comprehensive offerings, advanced technical capabilities, extensive global network and experienced management team.

OUR INTELLECTUAL PROPERTY AND DATA PROTECTION

We believe that our patents, trademarks, copyrights, domain names, know-how and other forms of intellectual property are critical to our success.

As of December 31, 2024, we had 5 registered patents (including four utility model patents and one design patent covering 3D photography booths, projectors and 3D portrait package designs), 15 pending patent applications, 18 copyright licenses, 46 registered trademarks and 3 registered domain names in China. Our list of patents and patent applications are as follows:

•        Patents