As filed with the U.S. Securities and Exchange Commission on June 8, 2026.

Registration No. 333-296228

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

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AMENDMENT NO. 1
TO
FORM F-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

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DSC Holdings Ltd.
(Exact Name of Registrant as Specified in Its Charter)

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

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No. 2 Wangjiang North Road, Room 148
Zhongshan Community, Baiyun Street
Dongyang, Jinhua City,
Zhejiang Province, China +86 0571 8860 7326
(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)

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COGENCY GLOBAL INC.
122 East 42nd Street, 18th Floor, New York, NY 10168
+1 800-221-0102
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent For Service)

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Copies to:

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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.

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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 United States Securities and Exchange Commission, acting pursuant to such Section 8(a), may determine.

This is an initial public offering of              American depositary shares, or ADSs, of DSC Holdings Ltd. Each ADS represents              of our Class A ordinary shares, par value US$0.0001 per share.

Prior to this offering, there has been no public market for the ADSs or our Class A ordinary shares. We anticipate that the initial public offering price will be between US$             and US$             per ADS. We have applied to list the ADSs representing our Class A ordinary shares on the Nasdaq Global Select Market under the symbol “DSC.”

Neither the United States Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

Following the completion of this offering, our issued and outstanding share capital will consist of Class A ordinary shares and Class B ordinary shares. Mr. Junhong Yao, our founder, director and chief executive officer, will beneficially own all of our issued and outstanding Class B ordinary shares and will be able to exercise approximately             % of the total voting power of our issued and outstanding share capital immediately following the completion of this offering. Holders of Class A ordinary shares and Class B ordinary shares have the same rights except for voting and conversion rights. Each Class A ordinary share is entitled to one vote. Each Class B ordinary share is entitled to 10 votes. Each Class B ordinary share is convertible into one Class A ordinary share at any time by the holder thereof, while Class A ordinary shares are not convertible into Class B ordinary shares under any circumstances. Upon any sale, transfer, assignment or disposition of any Class B ordinary share by a holder thereof to any non-affiliate to such holder, each of such Class B ordinary share will be automatically and immediately converted into one Class A ordinary share. See “Description of Share Capital.” Immediately following the completion of this offering, we will be a “controlled company” within the meaning of the Nasdaq rules. See “Principal Shareholders.”

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We are an “emerging growth company” under the U.S. federal securities laws and will be subject to reduced public company reporting requirements. Investing in our ADSs involves risks. See “Risk Factors” beginning on page 40 of this prospectus.

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DSC Holdings Ltd. (“DSC” or the “Company”) is a Cayman Islands holding company with no substantial operations of its own. The Company conducts its current operations primarily through its subsidiaries in China and through the contractual arrangements between such subsidiaries and two variable interest entities, namely Hangzhou Souche Network Technology Co., Ltd. (“Hangzhou Souche”) and Beijing Peak Technology Co., Ltd. (“Beijing Peak,” and together with Hangzhou Souche, the “VIEs”), and their subsidiaries. The VIEs are combined or consolidated for accounting purposes only and DSC does not own any equity interests in the VIEs. The PRC laws and regulations restrict and impose conditions on direct foreign investment in certain types of business, including value-added telecommunications business, and we therefore operate these businesses in China through the VIE structure which provides investors with exposure to foreign investment in the Chinese operating companies where the PRC laws

impose limitations on us from direct foreign investment in the operating companies. For a summary of these contractual arrangements, see “Corporate History and Structure — Contractual Arrangements with the VIEs and Their Shareholders.” Investors are purchasing equity interests in DSC, the Cayman Islands holding company, and are not purchasing, and may never directly hold, equity interests in the VIEs. Investors who are non-PRC residents may never directly hold equity interests in the VIEs under current PRC laws and regulations. As used in this prospectus, “we,” “us,” or “our” refers to DSC and its subsidiaries.

Our corporate structure is subject to risks relating to our contractual arrangements with the VIEs and their shareholders. The VIEs and their subsidiaries generated 37.7%, 42.1% and 59.8% of our total revenues in 2023, 2024 and 2025, respectively. As of December 31, 2024 and 2025, the total current assets and non-current assets of the VIEs and their subsidiaries accounted for 62.3% and 63.9% of our consolidated total assets, respectively. As of the date of this prospectus, our contractual arrangements with the VIEs have not been tested in any of the PRC courts. The interpretation and application of current and future PRC laws and regulations relating to these contractual arrangements are still evolving. If the PRC government considers that our contractual arrangements with the VIEs do not comply with the PRC regulations on direct foreign investment in the relevant industries, or if the relevant PRC laws and regulations or the interpretation thereof change in the future, we could be subject to severe penalties or be forced to relinquish our interests in the VIEs, forfeit our rights under the contractual arrangements, or otherwise significantly change our corporate structure. DSC and investors in the ADSs face uncertainty about potential future actions by the PRC government, which could affect the enforceability of our contractual arrangements with the VIEs and, consequently, significantly affect the financial condition and results of operations of DSC. If we are unable to assert our right to control the assets of the VIEs, or if the PRC government were to prohibit the VIE structure entirely, it could lead to a material adverse change in our operations, and the ADSs may significantly decline in value or become worthless. See “Risk Factors — Risks Related to Corporate Structure.”

As substantially all of our operations are based in China, we face various legal and regulatory requirements related to being based in and having the majority of our operations in China. Like the government of some other countries does to the companies based in their countries, the PRC government has substantial discretion and authority to influence the ability of China-based companies, including our own, to conduct business, accept foreign investments, and list on a U.S. or other foreign exchanges. For example, we face risks associated with regulatory approvals of offshore offerings, anti-monopoly regulatory actions and oversight on cybersecurity and data privacy. These risks could result in a material change in our operations, affect the value of our ADSs, or significantly limit or completely hinder our ability to offer or continue to offer ADSs and/or other securities to investors overseas, potentially causing the value of such securities to significantly decline or be worthless. For a detailed description of risks related to doing business in China, see “Summary — Permission Required from the PRC Authorities for Our Operations and Offerings” and “Risk Factors — Risks Related to Doing Business in China.”

The Chinese legal system is rapidly evolving, and we could be adversely affected by uncertainties with respect to the enforcement of laws and unexpected changes in laws and regulations. Rules and regulations in China can change quickly with little advance notice. In addition, the interpretation and enforcement of Chinese laws and regulations involve additional uncertainties. Since administrative and court authorities in China have substantial discretion to varying degrees in interpreting and implementing statutory provisions and contractual terms, it may be difficult to evaluate the outcome of administrative and court proceedings and the level of legal protection we enjoy. The PRC legal system encompasses government policies and administrative rules. New policies and rules may be introduced from time to time and may not be timely published, and existing ones may be modified quickly with little advanced notice and with possible retroactive effect under certain circumstances. We may be found to be in violation of these policies and rules if we fail to timely and effectively adapt ourselves to these regulatory developments. Such potential violations, including potential violations over the scope and effect of our contractual, property (including intellectual property) and procedural rights, could materially and adversely affect our business and impede our ability to continue our operations. In addition, the PRC government may intervene or influence our operations as the government deems

appropriate to further regulatory, political and societal goals. The PRC government has, in recent years, published new policies that significantly affected certain industries, including the internet sector. It is possible that the PRC government will release additional regulations or policies in the future that could adversely affect our business, financial condition and results of operations. Furthermore, the PRC government has recently indicated an intent to exert more oversight and control over overseas securities offerings and other capital markets activities and foreign investment in China-based companies like us. Any such actions, if taken by the PRC government, could result in a material change in our operations, and/or 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, in extreme cases, become worthless. For more details, see “Risk Factors — Risks Related to Doing Business in China — The evolving PRC legal system, including uncertainties regarding the enforcement of laws, and sudden or unexpected changes in laws and regulations in China could adversely affect us and limit the legal protections available to you and us,” and “Risk Factors — Risks Related to Doing Business in China — We are subject to uncertainties of conducting the company’s business operations in China. The PRC government exerts substantial influence over the manner in which we conduct our business operations. It may influence or intervene in our operations at any time as part of its efforts to enforce PRC law, which could result in a material adverse change in our operations and the value of the ADSs.”

Trading in our securities on U.S. markets, including the Nasdaq, may be prohibited under the Holding Foreign Companies Accountable Act (the “HFCAA”) if the Public Company Accounting Oversight Board (the “PCAOB”) determines that it is unable to inspect or investigate completely our auditor for two consecutive years. On December 16, 2021, the PCAOB issued the HFCAA Determination Report to notify the SEC of its determinations that the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong (the “2021 Determinations”), including our auditor. On December 15, 2022, the PCAOB announced that it was able to conduct inspections and investigations of PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong in 2022. The PCAOB vacated its previous 2021 Determinations accordingly. However, whether the PCAOB will continue to be able to satisfactorily conduct inspections and investigations of PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong is subject to uncertainty and depends on a number of factors outside of our control, as well as that of our auditor, including positions taken by authorities of the PRC. 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. 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 the mainland China and Hong Kong. The possibility of being a “Commission-Identified Issuer” and the 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 any 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. If we were identified as a “Commission-Identified Issuer” for two consecutive years, trading in our securities on U.S. markets would be prohibited under the HFCAA. For more details, see “Risk Factors — Risks Related to Doing Business in China — If the PCAOB is prevented from fully evaluating audits and quality control procedures of our auditor, investors may be deprived of the benefits of such PCAOB inspections,” and “Risk Factors — Risks Related to Doing Business in China — The Holding Foreign Companies Accountable Act may result in the delisting of the ADSs. The delisting of our ADSs, or the threat of their being delisted, may materially and adversely affect the value of your investment.”

DSC, our Cayman Islands holding company, may transfer cash to its wholly owned subsidiaries incorporated in the Cayman Islands, the British Virgin Islands, and Hong Kong through capital injections and intra-group loans. Similarly, DSC’s wholly owned subsidiaries in Hong Kong may transfer cash to Hangzhou Dasouche Information Technology Service Co., Ltd. and CheYiPai (Beijing) Automotive Technology Service Co., Ltd., which we refer to collectively as our wholly foreign owned entities in the PRC, or WFOEs, and other PRC subsidiaries through capital injections and intra-group loans. Cash is also transferred through our organization by way of intra-group transactions to pay for

services or goods provided. Additionally, if our WFOEs and other PRC subsidiaries realize accumulated after-tax profits, they may, upon satisfaction of relevant statutory conditions and procedures, pay dividends or distribute earnings to DSC’s Hong Kong subsidiaries as the WFOEs’ and other PRC subsidiaries’ shareholders. These Hong Kong subsidiaries may, in turn, transfer cash to their parent companies incorporated in the Cayman Islands or the British Virgin Islands, through dividends or other distributions. With necessary funds, DSC may pay dividends or make other distributions to U.S. investors and service any debt it may have incurred outside of the PRC. Under current PRC laws and regulations, we are permitted to transfer funds to the VIEs through loans, rather than through capital contributions, since we do not own equity interests in the VIEs. In 2023, 2024 and 2025, the VIEs paid RMB49.7 million, RMB21.0 million and RMB6.9 million (US$1.0 million) respectively, to the WFOEs for certain administrative and delivery services the WFOEs provided to the VIEs, or as intra-group loans provided by the VIEs to the WFOEs to meet their working capital needs. Furthermore, in 2023, 2024 and 2025, the WFOEs transferred funds of RMB18.7 million, RMB6.9 million and nil, respectively, to the VIEs as payment of certain delivery, marketing and customer engagement solutions provided by the VIEs to the WFOEs or as intra-group loans provided by the WFOEs to the VIEs to meet their working capital needs. For details, see “Prospectus Summary — Our Summary Combined and Consolidated Financial Data and Operating Data — VIE Consolidating Schedules.” As of the date of this prospectus, none of the WFOEs or our other PRC subsidiaries has paid any dividend or made any distributions to their respective shareholders. DSC has not previously declared or paid any cash dividend or dividend in kind, and has no plan to declare or pay any dividends in the near future. For more details, see “Corporate History and Structure — Transfer of Funds and Other Assets through Our Organization,” “Corporate History and Structure — Regulatory Requirements on Foreign Exchange and the Ability to Transfer Cash Between Entities, Across Borders and to U.S. Investors” and “Corporate History and Structure — Dividends or Distributions Made to the Company and U.S. Investors and Tax Consequences.” We currently have not maintained any cash management policies that dictate the purpose, amount and procedure of cash transfers between the Company, our WFOEs and other PRC subsidiaries, the VIEs, or the investors. Rather, the funds can be transferred in accordance with the applicable laws and regulations in the PRC and other jurisdictions.

To the extent our cash in the business is in the PRC or a PRC entity, the funds may not be available to distribute dividends to our investors, or for other use outside of the PRC, due to oversight on or the regulatory requirements and limitations on the ability of us, our subsidiaries, or the VIEs by the PRC government to transfer cash. The PRC government exerts oversights, in accordance with applicable laws and regulations, on the convertibility of Renminbi into foreign currencies and, in certain cases, the remittance of currency out of China. Our cash dividends, if any, will be paid in U.S. dollars. As a consequence, we might not be able to pay dividends in foreign currencies to our shareholders. If we are considered a PRC tax resident enterprise for tax purposes, any dividends we pay to our overseas shareholders may be regarded as China-sourced income and as a result may be subject to PRC withholding tax. In addition, relevant PRC laws and regulations permit the PRC companies to pay dividends only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. The Company’s PRC subsidiaries may pay dividends only 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; each of the 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. Additionally, our PRC subsidiaries and the VIEs can only distribute dividends upon approval of the shareholders after they have met the PRC requirements for appropriation to the statutory reserves. Such laws and regulations would limit our ability to transfer cash between the Company, our WFOEs and other PRC subsidiaries, the VIEs, or investors. See “Risk Factors — Risks Related to Doing Business in China — PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and regulatory restriction of currency conversion may restrict or delay us from using the proceeds of this offering 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,” “Risk Factors — If we are classified as a PRC resident

TABLE OF CONTENTS

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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 ADSs offered hereby, and only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date.

Neither we nor any of the underwriters has 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 free writing prospectus must inform themselves about, and observe any restrictions relating to, the offering of the ADSs and the distribution of this prospectus or any free writing prospectus outside of the United States. This offering is being made in the United States and elsewhere solely on the basis of the information contained in this prospectus. You should assume that the information appearing in this prospectus is accurate only as of the date on the front cover of this prospectus, regardless of the time of delivery of this prospectus or any sale of the ADSs representing our Class A ordinary shares. Our business, financial condition, results of operations and prospects may have changed since the date on the front cover of this prospectus.

Until               , 2026 (the 25th day after the date of this prospectus), all dealers that buy, sell or trade the ADSs, 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

You are not purchasing equity securities of our subsidiaries that have substantive business operations in China but instead are purchasing equity securities of a Cayman Islands holding company. DSC Holdings Ltd. is a Cayman Islands holding company that conducts all of its business operations in China through its PRC subsidiaries and the VIEs. Such structure involves unique risks to investors in the ADSs. You should carefully consider the risks and uncertainties described below and the other information in this prospectus before making an investment in the ADSs. Our business, financial condition or results of operations could be materially and adversely affected if any of these risks occurs, and as a result, the market price of the ADSs could decline and you could lose all or part of your investment. In particular, as we are a China-based company incorporated in the Cayman Islands, you should pay special attention to the subsection headed “Risks Related to Doing Business in China” below. This prospectus also contains forward-looking statements that involve risks and uncertainties. See “Cautionary Statement Regarding Forward-Looking Statements.” Our actual results could differ materially and adversely from those anticipated in these forward-looking statements as a result of certain factors, including the risks and uncertainties described below and elsewhere in this prospectus.

Risks Related to Our Business and Industry

If we fail to provide a differentiated and superior customer experience and satisfactory services, the size of our customer base and the demand for our services could decline, and our business would be materially and adversely affected.

Providing a differentiated and superior customer experience and satisfactory services for our customers, including both car dealers and OEMs, are critical to our business. Our ability to provide a high-quality customer experience depends on a number of factors, including:

•        our ability to provide customers with high-quality services;

•        our ability to improve our existing services and upgrade our services;

•        our ability to meet the diverse needs of our customers with ongoing innovation and new services;

•        our ability to maintain and improve operating efficiency, customer experience of online transactions and service quality of our offline networks and personnel;

•        our ability to leverage technology and data to improve our services;

•        our ability to conduct effective sales and marketing activities to attract and retain our customers and maintain our reputation as a trusted brand;

•        our ability to adequately train and manage our employees; and

•        our ability to effectively ensure the quality of services provided by our third-party service providers.

We cannot guarantee that we can continuously provide a differentiated and superior experience to our customers as our business continues to evolve. Our failure to do so would materially and adversely affect our business, financial condition and results of operations.

Our failure to continuously develop new services to meet the evolving needs of customers, or achieve widespread customer adoption of those services, could negatively impact our business and financial results.

Our success depends on our continued innovation to provide services that are useful for customers or that otherwise provide value to customers. Any failure by us to capture the benefits that we expect from our rollout of new services could have an adverse effect on our business and financial results.

In addition to introducing new offerings within our existing services, we anticipate that over time we may reach a point when investments in our current services are less productive and the growth of our revenue will require more focus on developing new services for our customers. These new services, in the aggregate, may need to be widely adopted by our customers in order for us to continue to attract additional customers to our services or we may lose competitive edge in the markets we compete in. Without innovative services, we may be unable to attract additional customers or retain current customers, which could negatively affect our business and financial results. Accordingly, we must continually invest resources in service, technology and development in order to improve the attractiveness and comprehensiveness of our services and effectively incorporate new internet and mobile technologies into them. These expenses for the development of our services and technology may include costs of hiring additional personnel, engaging third-party service providers and conducting other research and development activities, and our ability to engage in such development may decline as a result of, among others, continued uncertainties around the global macroeconomic conditions and any cost-savings initiatives for our business. Moreover, there can be no assurance that innovations to our services, or the development of future services, will enhance customer engagement, achieve market acceptance, create additional revenue or become profitable. In addition, revenue relating to new services is typically unpredictable and our new services may have lower gross margins, lower retention rates, and higher marketing and selling costs than our existing services. We are likely to continue to modify our pricing models for both existing and new services so that the prices for our offerings reflect the value that those offerings provide to our customers. Our pricing models may not effectively reflect the value of our services, and, if we are unable to provide services that customers want to use, they may reduce or cease the use of our services.

Our business substantially depends on our relationship with our customers, primarily used car dealers and OEMs and their usage of our services. If a significant number of our customers cease to use or do not keep or increase the usage of our services or if we are unable to develop relationship with new customers, our business and financial results would be materially and adversely affected.

Our ability to expand and generate revenue depends, in part, on our ability to maintain and expand our relationships with customers and convince them to increase their use of our services, including both digitalization solutions and transaction services. Our customers’ usage of our services is also affected by their budgets and spending patterns, which in turn may be affected by macroeconomic, intensified competition, or other factors beyond our control. If our customers do not increase their use of our services, our revenue may not grow and our results of operations may be harmed. We may also be required to spend significantly more on sales and marketing than we currently plan to spend in order to maintain or increase revenue. These additional expenditures could adversely affect our business, results of operations and financial condition. Our customers may cease or reduce their usage of our services due to a variety of reasons or factors, such as constrained budgets for spending on digitalization solutions and transaction services during economic downturns or increased competition, dissatisfaction arising from perceived shortcomings in the quality of our offerings, rapid technological advancements rendering our services obsolete, allegations and rumors relating to our services, and other circumstances that are outside our or our customers’ control. More specifically, the subscription fees paid to us by used car dealers and new car brokers for access to our digitalization solutions are an increasingly important part of our revenue, and the majority of our contracts with these customers currently provide for one-year committed terms, with no contractual obligations requiring them to maintain their relationship with us beyond the committed term. Accordingly, these used car dealers and new car brokers may cancel their subscriptions with us in accordance with the terms of their subscription and may choose not to renew their subscriptions upon expiration. In such events, our business and financial results may be materially and adversely affected.

Our past performance is not indicative of our future growth, and our growth in the future is uncertain.

Our total revenues increased by 4.3% from RMB909.0 million in 2023 to RMB948.2 million in 2024. Our total revenues decreased by 28.6% to RMB677.1 million (US$96.8 million) in 2025, primarily attributable to the Disposition in December 2024. Our historical performance which included revenues from the financial product referral services prior to the Disposition is not

indicative of our future growth and our future revenue may not grow at our historical rate and could potentially be impacted by external factors outside our control. Our historical revenue growth was partially driven by the growth of financial product referral services. Therefore, our Disposition has had a negative impact on our total revenues and certain operating measures such as ARPU in the short to medium term on an absolute basis. Our revenue from digitalization solutions also fluctuated as we continued to adopt a more selective approach to accepting new projects due to profitability and receivable collection requirements. In addition, we will not be able to grow as expected, or at all, if we fail to increase the number of customers using our services, maintain and expand the number of dealers and OEMs that subscribe to our services and maintain and increase the fees that they are paying, further improve the quality of our services and introduce high quality new services, and provide more value-added services to our customers. If our revenue declines or fails to grow, investors’ perceptions of our business may be adversely affected, and our financial position may deteriorate.

Prior to the Restructuring, Souche Holdings Ltd was the sole entity for equity financing and the cash proceeds from such equity financings were allocated on an as-needed basis between the businesses we currently operate and the other subsidiaries of Souche Holdings Ltd. The cash allocated to us has been recorded as inter-company loans, as opposed to capital contribution, from Souche Holdings Ltd. After the Restructuring, the Predecessor continued to provide interest-free loans to the Group to meet the working capital needs. Certain of these loans were subsequently waived or extended. As a result, our historical financial information may not be indicative of our future results of operations, financial position, shareholders’ deficit and cash flows, had we operated as a standalone entity and contracted at arm’s length with unrelated third parties for funding. For more details about the Restructuring, see “Corporate History and Structure.” For more information about our transactions with Souche Holdings Ltd, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources,” “Related Party Transactions” and Note 1 to our combined and consolidated financial statements included elsewhere in this prospectus.

We have a history of losses and have negative cash flows from operations, and we may not be able to achieve or sustain profitability in the future.

We have a history of losses. We incurred losses from operations of RMB190.6 million, RMB188.6 million and RMB101.9 million (US$14.6 million) in 2023, 2024 and 2025, respectively. In addition, we had negative cash flow from operating activities of RMB163.4 million, RMB212.5 million and RMB90.4 million (US$12.9 million) in 2023, 2024 and 2025, respectively.

Our ability to achieve profitability is heavily dependent on our ability to achieve revenue growth and to successfully execute our business plans in order to decrease operating cash outflows, including increasing sales of our services and continuing to control and optimize operating costs and expenses. To execute these business plans, we will continue to gain reputation among customers and brand recognition through offering high-quality services, which may also boost our market share in the respective markets. Meanwhile, we will continue to optimize our cost and expense structure to improve the capital and operating efficiency of our business. However, we may need to continue to invest heavily in various aspects of our operations, such as labor, infrastructure, research and development, and sales and marketing, to facilitate our expansion in the future. These investments may not lead to revenue increase or generate positive cash flows in time, or at all.

We may continue to incur significant losses in the future for a number of reasons, including reduced demand for our services, increasing competition, sluggishness in the automobile industry generally and of the business of our customers in particular and other risks described in this prospectus, and we may encounter unforeseen expenses, difficulties, complications and delays, and other unknown factors. If we continue to incur losses in the future, we may not be able to reduce costs effectively because many of our costs are fixed. In addition, if we reduce variable costs to respond to losses, this may affect our ability to acquire customers, improve our services and grow our revenues. Accordingly, we may not be able to achieve or maintain profitability and we may continue to incur significant losses in the future, and this could seriously harm our business and cause the price of our ADSs to decline.

Our business is subject to risks related to China’s auto commerce industry, including industry-wide and macroeconomic risks.

We provide car dealers and OEMs in China with a comprehensive range of digitalization solutions and transaction services. We cannot assure you that this market will continue to grow rapidly in the future. Furthermore, the growth of China’s new car and used car industry could be affected by many factors, including:

•        general economic conditions in China and around the world;

•        macroeconomic issues around the world, such as global semiconductor chip shortage; the growth of disposable household income and the availability and cost of credit available to finance used car purchases;

•        the growth and evolution of and challenges in China’s automobile industry;

•        industry-wide transition, including in light of intensified competition;

•        the growth of China’s auto financing industry;

•        consumer acceptance of used cars and willingness to purchase used cars;

•        people’s general preference for passenger vehicles as the means of transportation;

•        consumer acceptance of financing car purchases;

•        taxes and other incentives or disincentives related to used car purchases and ownership;

•        environmental concerns and measures taken to address these concerns;

•        the cost of energy, including gasoline prices, and the cost of car license plates in various cities with license plate lottery or auction systems;

•        the improvement of the highway system and availability of parking facilities;

•        other government policies relating to used cars and auto financing in China;

•        fluctuations in the sales and price of new and used cars;

•        serious pandemic or other contagious diseases;

•        ride sharing, transportation networks and other fundamental changes in transportation patterns; and

•        other industry-wide issues, including supply and demand for used cars, age distribution of cars, seasonality of used car retail market and supply chain challenges.

Any adverse change to these factors could reduce demand for used cars and hence demand for our services, and our business, financial condition and results of operations could be materially and adversely affected.

Purchases of used vehicles are typically discretionary for consumers and have been, and may continue to be, affected by negative trends in the economy and other factors, including the availability of new vehicles, the difference between wholesale and retail prices, rising interest rates, the cost of energy and gasoline, changes in consumer behavior, the availability and cost of consumer credit, and the reduction in consumer confidence. These factors may have a negative impact on our customers’ ability and willingness to purchase our services, which could, in turn, have an adverse effect on our business, financial condition and results of operations.

General business and economic condition, including a severe and prolonged global economic recession and the slowdown in the Chinese economy, may adversely affect our business and results of operations.

The market for the automotive industry in China is affected by general business and economic conditions, especially as a result of the general uncertainties around the global macroeconomic conditions, deflationary pressures in China and weakness in the domestic property market, among other factors. Volatility caused by such events has resulted in, or may result in, customers’ reduced demand for our services, reduced spending on vehicles, inability of customers to obtain credit to finance purchases of vehicles and decreased confidence to make discretionary purchases.

The global macroeconomic environment continues to face numerous challenges. China’s economic growth has moderated in recent years, with GDP growth of approximately 5.0% in 2024, according to the National Bureau of Statistics of China, against a backdrop of persistent deflationary pressures and subdued consumer confidence. The PRC government has implemented a series of stimulus measures in recent years, including vehicle trade-in subsidies and consumption incentive programs, and we cannot assure you that these measures will be sustained or will continue to stimulate demand at current levels. There is uncertainty over the long-term effects of the expansionary monetary and fiscal policies which have been adopted by the central banks and financial authorities of some of the world’s leading economies, including China and the United States. Unrest, terrorist threats and the potential of war in the Middle East and elsewhere may increase market volatility across the globe. In particular, the relationship between China and the United States has experienced significant deterioration in recent years, including the imposition of substantial tariffs and export controls, contributing to ongoing uncertainty with respect to trade policies, treaties, government regulations and tariffs between the two countries. 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 sensitive to global economic conditions, as well as changes in domestic economic and political policies and the expected or perceived overall economic growth rate in China. Any severe or prolonged slowdown in the global or Chinese economy may materially and adversely affect our business, financial condition and results of operations.

Our limited operating history makes it difficult to evaluate our future prospects and results of operations.

We believe that our future success depends on our ability to achieve sustainable and profitable growth. We have recently completed a business restructuring and have a limited history operating as an integrated business focusing on digitalization solutions and transaction services. For more information about the restructuring, see “Corporate History and Structure.” Our limited operating history, and in particular our limited operating history after the Disposition, makes it difficult to evaluate our future prospects and results of operations. In addition, fluctuations in results could make period-to-period comparisons difficult. You should consider our future prospects in light of the risks and challenges encountered by a company with a limited operating history. These risks and challenges include, among others:

•        the uncertainties associated with our ability to continue our growth and maintain profitability;

•        preserving our competitive position in the markets in which we operate;

•        offering consistent and high-quality services to retain and attract customers;

•        implementing our strategies and modifying them from time to time to respond effectively to competition and changes in customer preferences;

•        enhancing awareness of our brand and continuing to build customer loyalty; and

•   recruiting, training and retaining qualified managerial and other personnel.

If we are unsuccessful in addressing any of these risks or challenges, our business may be materially and adversely affected.

We cannot guarantee that our monetization strategies, including up- and cross-selling initiatives, will be successfully implemented or generate sustainable revenues and profits.

We are at the early stage of monetizing our multiple services, and our monetization model is evolving. We believe we are in the early stage of monetizing our services, and our monetization strategies primarily include, among others, (i) enhancing the premium features and functions of our digitalization solutions to drive paying dealer conversion, (ii) leveraging our digitalization solutions to up- and cross-sell our transaction services, (iii) introducing our wide range of transaction services to our existing customers and (iv) broadening the scope of our transaction services to encompass more services and monetization opportunities. However, our new monetization initiatives are uncertain and may not achieve the anticipated effect. For instance, with respect to DaFengChe, we currently use a freemium model to acquire dealer participation and generate revenues by selling dealers annual subscription packages that allow them to access additional functionalities and privileges. Nonetheless, we cannot guarantee that we can successfully convert nonpaying dealers into paying customers or we will be able to successfully up- and cross-sell our services to customers.

We cannot assure you that we can successfully implement the existing business model to generate sustainable revenues, especially with respect to our attempts in broadening monetization model with limited track records, or that we will be able to develop new monetization strategies to grow our revenues. If we fail to maintain the implementation of our existing business model or develop new monetization approaches, we may not be able to maintain or increase our revenues or effectively manage any associated costs.

In addition, we may introduce new services for which we have little or no prior development or operating experience. If these new services fail to meet customers’ expectations or achieve expected adoption among customers, we may fail to diversify our revenue streams or generate sufficient revenues to justify our investments and costs, and our business and operating results may suffer as a result. Moreover, the industries and market segments into which we may expand the scope of our services may be subject to extensive and evolving laws, regulations, licensing requirements, and governmental oversight and there can be no assurance that the current regulatory framework will not change in a manner that restricts, imposes additional compliance burdens on, or otherwise adversely affects our ability to offer or expand our services.

We may face increasing competition or be unable to continue to compete effectively in our industry, which may lead to loss of market share, reduced revenue, increased expenses, departures of qualified employees and disputes with competitors. Furthermore, our current and potential competitors may have significantly greater resources than we do and may also develop and market new services that may adversely affect our business and operating results.

We face intense competition in the industry in which we operate. Our competitors primarily include other providers of transaction services for car dealers and OEMs, most of whom operate on small scales in local markets. Due to their limited operating scale, these competitors may be able to adapt to industry developments and regulatory changes more quickly and efficiently than we do and may offer comparable services at more competitive prices. Our current and future competitors may also have significantly more resources than we do, including financial, technological, marketing and other resources and may be able to devote greater resources to the development and promotion of their platforms and services. They may have deeper relationships with dealerships, OEMs, financial institutions providing auto financing services and other third-party service providers than we do. This could allow them to develop new services, adapt more quickly to changes in technology and undertake more extensive marketing campaigns, which may render our services less attractive to customers and businesses and cause us to lose market share. Moreover, intense competition in the markets we operate in may reduce our gross margin, lower our service fees, increase our operating expenses and capital expenditures, and lead to departures of our qualified employees. Failure to compete

with current and potential competitors could materially harm our business, financial condition and results of operations. Furthermore, we may also be harmed by negative publicity instigated by our competitors, regardless of its validity. We encountered and may in the future continue to encounter various disputes with our competitors, including lawsuits involving claims asserted under intellectual property infringement, unfair competition and defamation, which may adversely affect our business and reputation and may divert our management team’s attention from implementing our business strategies and adversely affect our business operation and financial condition.

If we are unable to compete with our competitors, the demand for our services could substantially decline. In addition, if one or more of our competitors were to merge or partner with another one of our competitors, the change in the competitive landscape could adversely affect our ability to compete effectively. Our competitors may also establish or strengthen cooperative relationships with our current or future suppliers, or other parties with whom we have collaborations, thereby limiting our ability to develop, improve and grow our business. We may not be able to compete successfully against current or future competitors, and competitive pressures may harm our revenue, business and financial results.

We operate in the used car transaction service market in China, which is emerging, rapidly evolving and competitive. As a result, predicting our prospects is challenging and our historical operating and financial results may not necessarily predict our future performance.

We operate in China’s used car transaction service market, which is emerging, rapidly evolving and fiercely competitive. As our business grows and the regulatory landscape evolves in the used car transaction service market, we continue to introduce new solutions and services, optimize existing ones, and adjust our business portfolio as needed. For instance, in November 2024, we entered into agreements to sell all of our equity interests in the PRC entities operating the financial product referral services as part of our efforts to better allocate corporate resources to serve the essential needs of used car dealers. The transaction was closed in December 2024.

Changes to our service offerings may not yield the anticipated results and could have an adverse impact on our financial condition and results of operations. As a result, it is challenging to predict our future prospects accurately. If we fail to meet the needs of our customers, or if the market for as well as the regulatory environment surrounding our offerings do not evolve or develop as expected, our business and results of operations may suffer.

If we are unable to effectively manage our growth or implement our business strategies, our business, financial condition and results of operations may be materially and adversely affected.

Our business and prospects depend in part on our ability to effectively manage our growth or implement our growth strategies. As part of our business strategies, we intend to continue to enhance our leadership in digitalizing auto commerce in China, increase the penetration of our transaction services, promote AI-enabled application to empower auto merchants, and expand globally leveraging our digitalization capabilities and industry know-how. Our experience in the markets in which we currently operate may not be applicable to the new markets we intend to expand into, and we may therefore not be able to leverage our existing experience to grow further. As a result, our expansion, business and monetization strategies may not be successful. Furthermore, expanding into new geographical markets will require us to hire additional employees to cover these markets. To sustain our growth, we will incur additional compensation and payroll costs, office rental expenses and other costs, as well as experience additional strain on our managerial resources. If we are unable to successfully implement our business strategies to manage our growth and generate sufficient revenues to cover our increased costs and expenses, our business, financial condition and results of operations may be materially and adversely affected.

Furthermore, our expansion into new service categories may expose us to new challenges and more risks. Although we have been successful in expanding into new service categories and businesses, we cannot assure you that we will be able to continue our success in expansion into new service categories. Our lack of experience with these new service categories may adversely affect

our prospects and our ability to compete with the existing market players in any of these service categories. Moreover, the expansion into new businesses may disrupt our ongoing business, distract our management and employees and increase our expenses to cover unforeseen or hidden liabilities or costs. We may also face challenges in achieving the expected benefits of synergies and growth opportunities in connection with these new service categories and businesses. Besides, we may be subject to additional compliance requirements for these new service categories and businesses. Failure to expand successfully may also diminish investor confidence in our decision-making and execution capabilities, which could materially and adversely affect our business, results of operations, financial condition and prospects.

Moreover, our business upgrade and expansion may lead to new challenges and risks. As a result, we need to continuously expand and enhance our infrastructure and technology, and improve our operational and financial systems, procedures and internal controls. We also need to train, manage and motivate our employees. In addition, we need to maintain and strengthen our relationships with our suppliers, customers, third-party service providers and other third parties. We cannot assure you that our personnel, infrastructure, systems, procedures and internal controls will be adequate to support our operations. Effectively managing our growth is dependent on a number of other factors, including our ability to:

•        help our customers locate high-quality used vehicles;

•        continue to improve our existing services and customer’s satisfaction;

•        launch new services and develop cross-selling opportunities;

•        stabilize our costs and expenses and enhance our efficiency;

•        recruit and retain skilled and experienced employees;

•        strengthen relationships with our existing business partners and establish collaborations with new business partners;

•        improve our risk management and internal control;

•        effectively expand into new geographic markets;

•        establish relationships with third-party service providers in new geographical areas into which we plan to expand;

•        upgrade our technology and continue to innovate new services; and

•        enhance synergies among our services.

If we fail to effectively manage our growth or implement our business strategies, our business, financial condition and results of operations may be materially and adversely affected.

Failure to achieve the anticipated synergies among our diverse portfolio of services could materially and adversely affect our business.

Over the years, we have continued to invest in promoting synergies among our services, with a view to not only achieving greater economies of scale but also creating compelling long-term values for our customers. We have already constructed a solid bedrock of digitalization solutions that can address our customers’ daily operation need. Building on our comprehensive digitalization solutions, we have introduced various transaction services to our customers and integrated such transactions into our digitalization solutions. For example, we are in the process of further integrating DaFengChe and CheYiPai to allow dealers to list their inventories and complete vehicle sales more easily. Furthermore, we expect the synergies between our complementary transaction services to enable us to up- and cross-sell our different transaction services to the same customer to assist them with vehicle transactions. Failure to achieve the anticipated synergies from the integration of our services would materially affect our business, financial condition and results of operations.

Our business generates and processes a large amount of data and is subject to various evolving laws and regulations regarding cybersecurity and data privacy. Failure to address cybersecurity and data privacy concerns could subject us to significant reputational, financial, legal and operational consequences, and deter current and potential customers from using our services.

Our business generates and processes a large quantity of data. We face risks inherent in handling and protecting a large amount of data that our business generates and processes from the significant number of vehicle transactions our platform facilitates. In particular, we face a number of challenges relating to data from transactions and other activities on our platform, including:

•        protecting the data in and hosted on our system, including against attacks on our system by outside parties or fraudulent behavior or improper use by our employees or business partners;

•        addressing concerns related to sharing, safety, security and other privacy factors; and

•        complying with applicable laws, rules and regulations relating to the collection, use, storage, transfer, disclosure and security of personal information, including any requests from regulatory and government authorities relating to these data.

In general, we expect that data security and data protection compliance 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. If we are unable to manage these risks, we could become subject to penalties, including fines, suspension of business and revocation of required licenses, and our reputation and results of operations could be materially and adversely affected.

We are subject to various cybersecurity, data security and personal information protection laws and regulations in China. See “Regulation — Regulations on Information Security and Privacy Protection.” Moreover, different regulatory bodies in China, including the Ministry of Industry and Information Technology (the “MIIT”), the CAC, the Ministry of Public Security and the State Administration for Market Regulation (the “SAMR”), have enforced cybersecurity, data privacy and protections laws and regulations with various standards and applications. The changes and developments in enforcement of data privacy and protection laws have resulted in challenges in ensuring full compliance and increase our operating cost, as we need to spend time and resources to deal with various inspections for compliance. While we have adopted rigorous and comprehensive policies for the collection, processing, sharing, disclosure authorization and other aspects of data use and privacy and taken necessary measures to comply with applicable data privacy and protection laws and regulations, we cannot guarantee the effectiveness of these policies and measures undertaken by us, or by dealers or other business partners on our platform. Any failure or perceived failure to comply with all applicable data privacy and protection laws and regulations, 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 current and potential customers and subject us to fines and damages, which could have a material adverse effect on our business, financial condition and results of operations.

Furthermore, the PRC regulatory and enforcement regime with regard to cybersecurity and data protection is still evolving. PRC regulators have been increasingly focused on regulation in the areas of cybersecurity and data protection. The following are examples of recent PRC regulatory activities in this area.

•   In recent years, the PRC government has increasingly tightened the regulation of cybersecurity and the data security. The Cybersecurity Law of the PRC (the “Cybersecurity Law”) promulgated by the Standing Committee of the National People’s Congress (the “SCNPC”), came into force

on June 1, 2017, and was amended on October 28, 2025. In addition, the Data Security Law of PRC (the “Data Security Law”) was promulgated by the SCNPC on June 10, 2021 and took effect on September 1, 2021.

•        The Personal Information Protection Law (the “Personal Information Protection Law”) was released on August 20, 2021 and became effective on November 1, 2021. On July 7, 2022, the CAC released the Measures for Security Assessment of Cross-border Transfer of Data, which took effect on September 1, 2022 and are applicable to cross-border transfers of personal information and important data collected and generated in China under certain circumstances. On February 22, 2023, the CAC further released the Measures for the Standard Contract for Cross-border Transfer of Personal Information, which became effective on June 1, 2023. While we do not believe our current business operation involves any transmission, use and exchange of information that comes under the definition of “cross-border transfers of personal information and important data” under the foregoing laws and regulations, as our business continues to grow, there may arise circumstances where we engage in such cross-border transfers of personal information and important data, including in order to satisfy the legal and regulatory requirements, in which case we may need to comply with the foregoing requirements as well as any other limitations under PRC laws then applicable. Complying with these laws and requirements could cause us to incur substantial expenses or require us to alter or change our practices in ways that could harm our business. Additionally, to the extent we are found to be not in compliance with these laws and requirements, we may be subject to fines, regulatory orders to suspend our operations or other regulatory and disciplinary sanctions, which could materially and adversely affect our business, financial condition and results of operations.

•        On July 30, 2021, the State Council of the PRC promulgated the Provisions on Protection of Critical Information Infrastructure (the “CII Protection Regulations”), which became effective on September 1, 2021. Pursuant to the CII Protection Regulations, “critical information infrastructures,” or “CIIs,” refer to any important network facilities or information systems of the important industry or field such as public communication and information service, energy, communications, water conservation, finance, public services, e-government affairs and national defense science, which may endanger national security, people’s livelihood and public interest in case of damage, function loss or data leakage. In addition, relevant administration departments of each critical industry and sector shall be responsible for formulating eligibility criteria and identifying the CII operators, or CIIOs, in the respective industry or sector, and the CIIOs shall be responsible for protecting the CIIs’ security by performing certain prescribed obligations. As of the date of this prospectus, we have not been informed by CAC or any other PRC government authorities that we are identified or will be deemed as a CIIO. However, since the criteria for determining CIIOs remains subject to further clarification, we cannot assure you that we will not be identified as a CIIO by any competent regulatory authority in the future.

•   On December 28, 2021, the CAC and several other administrations jointly promulgated the Measures for Cybersecurity Review (the “Cybersecurity Review Measures”), which became effective on February 15, 2022. The Cybersecurity Review Measures provide that (i) a “network platform operator” holding over one million users’ personal information shall apply for a cybersecurity review when listing their securities “in a foreign country,” (ii) a CIIO that intends to purchase internet products and services that affect or may affect national security shall apply for a cybersecurity review and (iii) a “network platform operator” carrying out data processing activities that affect or may affect national security shall apply for a cybersecurity review. As a network platform operator who possesses personal information of more than one million users for purposes of the Cybersecurity Review Measures, we have applied for and completed a cybersecurity review with respect to our proposed overseas listing pursuant to the Cybersecurity Review Measures.

•   In addition, the Regulations on the Security Management of Network Data (the “Network Data Regulations”) were promulgated by the State Council on September 24, 2024, and became effective as of January 1, 2025. The Network Data Regulations stipulate detailed implementing rules and guidelines applicable to the protection of personal information, the security of important data, the security management of data exports, the obligations of network platform operators, and the supervision, management and legal responsibilities related to the foregoing. Any failure to comply with such requirements may subject us to, among others, suspension of services, fines, revoking relevant business permits or business licenses and penalties.

For a more detailed discussion of the applicability of the Cybersecurity Review Measures and the Network Data Regulations and how we will comply with these regulations, see “Regulation — Regulations on Information Security and Privacy Protection.”

In addition to government regulation, privacy advocates and industry groups have and may in the future propose self-regulatory standards from time to time. These and other industry standards may legally or contractually apply to us, or we may elect to comply with such standards. We expect that there will continue to be new proposed laws and regulations concerning data privacy and security, and we cannot yet determine the impact such future laws, regulations and standards may have on our business. New laws, amendments to or reinterpretations of existing laws, regulations, standards and other obligations may require us to incur additional costs and restrict our business operations. Because the interpretation and application of laws, regulations, standards and other obligations relating to data privacy and security are still uncertain, it is possible that these laws, regulations, standards and other obligations may be interpreted and applied in a manner that is inconsistent with our data processing practices and policies or the features of our services. If so, in addition to the possibility of fines, lawsuits, complaints, inquiries, allegations, regulatory investigations, public censure, other claims and penalties, and significant costs for remediation and damage to our reputation, we could be materially and adversely affected if legislation or regulations are expanded to require changes in our data processing practices and policies or if governing jurisdictions interpret or implement their legislation or regulations in ways that negatively impact our business, financial condition and results of operations. Furthermore, the developing requirements relating to clear and prominent privacy notices (including in the context of obtaining informed and specific consents to the collection and processing of personal information, where applicable) may potentially deter end users from consenting to certain uses of their personal information.

In general, negative publicity of us or our industry regarding actual or perceived violations of our end users’ privacy-related rights, including fines and enforcement actions against us or other similarly placed businesses, also may impair users’ trust in our privacy practices and make them reluctant to give their consent to share their data with us. Any inability to adequately address data privacy or security-related concerns, complaints, inquiries or allegations when they arise, even if unfounded, or to comply with applicable laws, regulations, standards and other obligations relating to data privacy and security, could result in additional cost and liability to us, harm our reputation and brand, damage our relationships with consumers and have a material and adverse impact on our business, financial condition and results of operations. In addition, due to data privacy or data security concerns, our ability to retain or increase our user base and user engagement may be materially and adversely affected, we may not be able to maintain or grow our revenue as anticipated and our financial results could be materially and adversely affected.

With regard to our commercial arrangements, we and our counterparties, including business partners and external service providers, might be subject to contractual obligations regarding the processing of personal information. While we believe our and our counterparties’ conduct under these agreements is in material compliance with all applicable laws, regulations, standards, certifications and orders relating to data privacy or security, we or our counterparties may fail, or be alleged to have failed, to be in full compliance. In the event that our acts or omissions result in alleged or actual failure to comply with applicable laws, regulations, standards, certifications and orders relating to data privacy or security, we may incur liability. While we endeavor to include indemnification provisions or other protections in such agreements to mitigate liability and losses

stemming from our counterparties’ acts or omissions, we may not always be able to negotiate for such protections and, even where we can, there is no guarantee that our counterparties will honor such provisions or that such protections will cover the full scope of our liabilities and losses.

While we strive to comply with our internal data privacy guidelines as well as all applicable data privacy and security laws and regulations and contractual obligations in respect of personal information, there is no assurance that we are able to comply with these laws, regulations and contractual obligations in all respects. Any failure or perceived failure by us, external service providers or business partners to comply may result in proceedings or actions against us, including fines and penalties or enforcement orders (including orders to cease processing activities) being levied on us by government agencies or proceedings or actions against us by our business partners, customers or end users, including class action privacy litigation in certain jurisdictions (if applicable), and could damage our reputation and discourage current and future users from using our services, which could materially and adversely affect our business, financial condition and results of operations. We from time to time conduct internal review on our compliance with internal guidelines and applicable laws and regulations concerning data privacy and security. These internal reviews have revealed several issues and vulnerabilities, such as our failure to process sensitive information in strict compliance with applicable data privacy laws and regulations, among other things. As of the date of this prospectus, we have implemented or are in the process of implementing measures to address the aforesaid deficiencies. However, there is no guarantee that these measures will be effective or that deficiencies in our past data privacy and security practices will not subject us to legal and regulatory liabilities, in which case our business, financial condition and results of operations may be materially and adversely affected.

In addition, compliance with applicable laws on data privacy requires substantial expenditure and resources, including to continually evaluate our policies and processes and adapt to new requirements that are or become applicable to us on a jurisdiction-by-jurisdiction basis, which would impose significant burdens and costs on our operations or may require us to alter our business practices. Concerns about the security of personal information also could lead to a decline in general internet usage, which could result in a decrease in demand for our services and have a material and adverse effect on our business, financial condition and results of operations.

We collect, process, store, transfer, share, disclose, and use information and data from our customers, and our actual or perceived failure to protect such information and data or respect our customers’ privacy could damage our reputation and brand and harm our business and operating results.

Some functions of our services involve the storage and transmission of consumers’ information, such as contact information of consumers who connect with dealers, profile information of users who create accounts on our platforms, as well as dealers’ and vehicles’ information. Some of this information may be private, and security breaches could expose us to a risk of loss or exposure of this information, which could result in potential liability, litigation and remediation costs. We may also be liable for improper collection, use or appropriation of personal information provided by our users. For example, hackers could steal our users’ profile passwords, names, email addresses, phone numbers and other personal information. We rely on encryption and authentication technology developed by ourselves or licensed from third parties (as applicable) to secure transmission of such information. Like all information systems and technology, our websites, mobile applications and information systems are subject to computer viruses, break-ins, phishing attacks, attempts to overload the systems with denial-of-service or other attacks, ransomware, and similar incidents or disruptions from unauthorized use of our computer systems, any of which could lead to interruptions, delays, or website shutdowns, and could cause loss of critical data and the unauthorized disclosure, access, acquisition, alteration, and use of personal or other confidential information. If we experience compromises to our security that result in website or mobile application performance or availability problems, the complete shutdown of our websites or mobile applications, or the loss or unauthorized disclosure, access, acquisition, alteration, or use of confidential information, consumers, customers, partners, vendors, and employees may lose trust and confidence in us, and dealers may decrease the use of our digitalization solutions, or stop or downgrade their subscriptions with us.

Further, outside parties have attempted and will likely continue to attempt to fraudulently induce our customers, dealers, employees, consumers or third-party service providers to disclose sensitive information in order to gain access to our information or the information of customers, consumers, dealers, employees and third-party service providers. As cyberattacks increase in frequency and sophistication, our cybersecurity and business continuity plans may not be effective in anticipating, preventing and effectively responding to all potential cyber-risk exposures. In addition, because the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently, are often not recognized until after having been launched against a target, and may originate from less regulated and remote areas around the world, we may be unable to proactively address these techniques or to implement adequate preventative measures.

Any or all of the issues above could adversely affect our brand reputation, negatively impact our ability to attract new customers and increase engagement by existing customers, cause existing customers to reduce or stop the use of our services or close their accounts, cause existing customers to cancel their contracts, cause employees to terminate their employment, cause employment candidates to be unwilling to pursue employment opportunities or accept employment offers, and/or subject us to governmental or third-party lawsuits, investigations, regulatory fines, or other actions or liability, thereby harming our business, financial condition and results of operations.

Our systems and software may be subject to security breaches, interruptions, failures and/or other errors. Real or perceived errors or failures in our software and system could negatively impact our results of operations and growth prospects.

Our system and software may be subject to security breaches.

Our success depends on the confidence of dealers, OEMs and our other network users/participants and data providers in our ability to store, process and transmit confidential information securely over the internet or otherwise and operate our computer systems and operations without significant disruption or failure. We transmit substantial amounts of confidential information, including nonpublic personal information of consumers, over the internet. Moreover, even if our security measures are adequate, concerns over the security of third-party data that we store, process and transmit, which may be heightened by any well-publicized compromise of security, may deter customers from using our services and/or deter vendors from providing their products to us. If our security measures are breached and unauthorized access to confidential information is obtained, our network may be perceived as not being secure and our customers may curtail or stop using our network or other systems and/or vendors may curtail or stop providing their products to us. Any failure of, or lack of confidence in, our secure online services could have a material adverse effect on our business, prospects, financial condition and results of operations.

Large commercial, healthcare and financial entities with sophisticated security operations have been impacted by security breaches through malware and unintended system entry through compromised credentials or by other advanced means. Despite our focus on data security, we may not be able to stop unauthorized attempts to gain access to data that we store, process and transmit or to stop disruptions in the transmission or provision of data and communications among our network participants. Advances in computer capabilities, new discoveries in the field of cryptography, or other events or developments could result in a compromise or breach of the algorithms used by our services to protect data contained in our, our customers’ and/or our vendors’ databases and the information being stored, processed or transferred.

Although we generally limit warranties and liabilities relating to data and system security in our customer and vendor contracts, they or third parties may seek to hold us liable for any losses suffered as a result of unauthorized access to their confidential information or nonpublic personal Information of their customers. In addition, we may not have limited our warranties and liabilities sufficiently or have adequate insurance to cover these losses. We may be required to expend significant capital and other resources to protect against security breaches and/or to alleviate the problems caused. Our security measures may not be sufficient to prevent security breaches, and

any failure to prevent security breaches and/or alleviate any problems caused by security breaches could have a material adverse effect on our business, prospects, financial condition and results of operations.

Our network and systems may be vulnerable to interruptions or failures.

From time to time, we have experienced, and may experience in the future, network or system slowdowns and interruptions. These network and system slowdowns and interruptions may interfere with our ability to do business. Although we believe we have made and are continuing to make the appropriate upgrades to our system, regularly back up data and take other measures to protect against data loss and system failures, there is still risk that we may lose critical data or experience network failures. Such failures or disruptions may result in lost revenue opportunities for our customers, which could result in litigation against us or a loss of customers. Additionally, we have service level agreements with certain of our customers that may result in penalties or trigger cancellation rights in the event of a network slowdown or interruption. This could have a material adverse effect on our business, prospects, financial condition and results of operations.

Real or perceived errors or failures in our software and systems could negatively impact our results of operations and growth prospects.

We depend upon the sustained and uninterrupted performance of numerous proprietary and third-party technologies to deliver our services. If one or more of those technologies cannot scale up to meet demand, or if there are errors in our execution of any feature or functionality using any such technologies, then our business may be harmed. Because our software is often complex, undetected errors and failures may occur, especially when new versions or updates are made. Despite our testing, errors or bugs in our services or in third-party programs integrated with our services may not be found until the software or service is in active use by us or our customers. Moreover, our customers could incorrectly implement or inadvertently misuse our services, which could result in customers’ dissatisfaction and adversely impact the perceived utility of our services as well as our brand. Any of these real or perceived errors, failures or bugs could result in negative publicity, reputational harm, loss of or delay in market acceptance of our services, loss of competitive position or claims by customers for losses sustained by them, all of which, along with the costs of responding to such effects, may have a material adverse effect on our business, prospects, financial condition and results of operations.

Our systems may be harmed by events beyond our control.

Our computer systems and operations are vulnerable to damage or interruption from natural disasters, such as fires, floods and hurricanes, or from power outages, telecommunications failures, terrorist attacks, network service outages and disruptions, “denial of service” attacks, computer viruses, break-ins, sabotage and other similar events beyond our control. The occurrence of any such event at our facilities, any third-party facility we utilize or the disaster recovery center we use could cause interruptions to or delays in our business and loss of data, or could render us unable to provide our services. In addition, the failure of a third-party facility to provide the data communications capacity required by us, as a result of human error, bankruptcy, natural disaster or other operational disruption, could cause interruptions to our computer systems and operations. The occurrence of any or all of these events could have a material adverse effect on our business, prospects, financial condition and results of operations.

We collect information from third-party platforms and purchase data from third-party data providers. If we are unable to maintain or grow such relationships, or experience interruptions in the products or services they provide, our financial condition or results of operations could be adversely affected.

We collect information from various third-party platforms to better serve our customers. We also obtain data from certain third-party data providers, including inventory management systems, automotive website providers, customer relationship management systems, dealer management

systems and third-party data licensors. Our business relies on our ability to obtain information and data for the benefit of our customers. We could experience interruptions in our information or data access for a number of reasons, including difficulties in renewing our agreements or collaborations with information or data providers, changes to the software used by information or data providers, efforts by industry participants to restrict access to information or data, increased fees we may be charged by information or data providers and the continuing effects of macroeconomic conditions. Our business operations and financial condition could be negatively affected if any current provider terminates its relationship with us or our service from any provider is interrupted. If there is a material disruption in the data provided to us, the information that we provide to our customers using our services may be limited. In addition, the quality, accuracy and timeliness of this information may suffer, which may lead to a less valuable and less transparent customer experience for using our services and could negatively affect our business and operating results.

Activities of our customers or business partners on our platforms could damage our brand, subject us to liability, and harm our business and financial results.

Our terms of service and acceptable use policy prohibit our customers and business partners from using our services to engage in illegal or otherwise prohibited activities and our terms of service and acceptable use policy permit us to terminate a customer’s or a business partner’s account if we become aware of such use. Customers or business partners may nonetheless engage in prohibited or illegal activities or upload or store content in violation of applicable laws, without our knowledge, which could subject us to liability. Furthermore, our brand may be negatively impacted by the actions of customers or business partners that are deemed to be hostile, offensive, inappropriate or illegal. While we use technology to monitor for the compliance status of customers and business partners against our terms of service and acceptable use policy for a number of our services, we do not proactively and comprehensively monitor or review the appropriateness of the content posted by our customers or business partners in connection with our services and we do not have control over their activities or the activities in which other users on our digital platform may engage. The safeguards we have in place may not be sufficient for us to avoid liability or avoid harm to our brand, especially if such hostile, offensive, inappropriate or illegal use is high profile, which could adversely affect our business and financial results. The laws relating to the liability of online service providers are evolving and subject to challenges including claims related to defamation, libel, breach of contract, invasion of privacy, negligence, and copyright or trademark infringement. Developments in these laws in various jurisdictions could subject us to liability, penalties or restrictions on our business.

A significant disruption to service on our websites or mobile applications could damage our reputation and result in a loss of customers, which could harm our business, brands, financial condition and results of operations. Any disruption to or discontinuity in the features and functions of our digital platform may materially and adversely affect our business.

Our brands, reputation, and ability to attract dealers and OEMs depend on the reliable performance of our technology infrastructure and content delivery. We have experienced, and we may in the future experience, interruptions with our systems. Such interruptions, whether due to system failures, computer viruses, ransomware, physical break-ins, electronic breaches or otherwise, could affect the security or availability of our platforms and marketplaces on our websites and mobile applications, and prevent or inhibit the ability of dealers and OEMs to access our services. For example, disruptions may affect our ability to activate customer accounts and manage our billing activities in a timely manner. Such interruptions may in the future result in third parties accessing our confidential and proprietary information, including our intellectual property. Problems with the reliability or security of our systems could harm our reputation and our ability to protect our confidential and proprietary information, which can result in a loss of customers and additional costs.

Substantially all of the communications, network and computer hardware used to operate our platforms are located in China. A disruption to one or more of these system, networks or infrastructures may cause us to experience an extended period of system unavailability, which could negatively impact our relationship with our customers. Our systems and operations are vulnerable to damage or interruption from fire, flood, power loss, telecommunications failure, terrorist attacks, acts of war, electronic breaches, physical break-ins, computer viruses, earthquakes and similar events. The occurrence of any of these events could result in damage to our systems and hardware or could cause them to fail. In addition, we may not have sufficient protection or recovery plans in certain circumstances.

Problems faced by our cloud service providers could adversely affect the experience consumers have while using our solutions. Our third-party cloud service providers may close their facilities without adequate notice. Any financial difficulties, up to and including bankruptcy, faced by our third-party cloud service providers or any of their service providers may have negative effects on our business, the nature and extent of which are difficult to predict. If our third-party cloud service providers are unable to keep up with our capacity needs, our business could be harmed.

Any errors, defects, disruptions, or other performance or reliability problems with our network operations could cause interruptions in access to our services as well as delays and additional expense in arranging new facilities and services and could harm our reputation, business, operating results and financial condition. Although we carry insurance, it may not be sufficient to compensate us for the potentially significant losses, including the potential harm to the future growth of our business, which may result from interruptions with our service due to system failures.

We rely on the proper functioning of features and functions of our digital platform for the daily operations of our digitalization solutions and transaction services. Although we have implemented comprehensive rules and protocols for use of our digital platform, we cannot assure you that all aspects of our rules and protocols will be always satisfactorily implemented. With the increasing number of customers, including used car dealers and OEMs, using our digital platform who may not be familiar with our rules and protocols, it may be difficult for us to effectively monitor our customers or other parties to ensure that their activities on our digital platform are in accordance with our predetermined rules and protocols. If violations of rules and protocols or other inappropriate actions occur, such as circumventing our digitalization solutions and transaction services to facilitate transactions that are required to be partitioned according to relevant rules and protocols, and if we fail to effectively prevent non-compliance or discipline the responsible customers or other parties, the effectiveness of our digital platform may be diminished and other customers using our digitalization solutions and transaction services may be less willing to follow the rules, which could materially and adversely affect our business, financial condition and results of operations.

We rely on our proprietary technology, including technology for critical functions of our business. Failure to properly maintain or promptly update our technology may result in disruptions to or lower quality of our services, and our business, financial condition and results of operations may be materially and adversely affected.

We rely on our proprietary technology, including websites and mobile applications, car inspection system and AI algorithms for critical functions of our businesses. See “Business — Our Data Capabilities and Technologies.” Maintaining and upgrading our technology carry certain risks, including the risk of disruptions caused by significant design or deployment errors, delays or deficiencies, which has made and may continue to make our platform and services unavailable. We may also implement additional or enhanced technology in the future to accommodate our growth and to provide additional capabilities and functionalities. The implementation of new or enhanced technologies may be disruptive to our business as it can be time-consuming and expensive and may increase management responsibilities and divert management attention. Additionally, our proprietary AI algorithms are based on data-driven analytics. If we do not have a large amount of data or the quality of data available to us for analysis is unsatisfactory, or if our algorithms have

deficiencies, our proprietary AI algorithms may fail to perform effectively. If we fail to properly maintain or promptly upgrade our technology, our services may be disrupted or become of lower quality or unprofitable, and our business, financial condition and results of operations may be materially and adversely affected.

We rely on certain third-party technology to complete critical business functions, and if that technology fails to adequately serve our needs and we cannot find alternatives, it may significantly impact our operating results.

Our success depends upon our relationships with third parties, including, among others: our payment processor; our cloud service providers; and our partners and contractors for delivery, inspection and certification associated with our business. If these third parties experience difficulty meeting our requirements or standards, have adverse audit results, violate the terms of our agreements or applicable law, or fail to obtain or maintain applicable licenses, or if the relationships we have established with such third parties expire or otherwise terminate, it could be difficult for us to operate some aspects of our business, which could damage our business and reputation. In addition, if such third-party service providers or strategic partners were to cease operations, temporarily or permanently, face financial distress or other business disruptions, or increase their fees, or if our relationships with these providers or partners deteriorate or terminate, whether as a result of macroeconomic conditions or otherwise, we could suffer increased costs and we may be unable to provide similar services until we could find an equivalent or develop replacement technology or operations, which could disrupt our business and adversely affect our revenue, business, financial condition and results of operations. Furthermore, if we are unsuccessful in identifying or finding high-quality partners, fail to establish cost-effective relationships with them, or ineffectively manage these relationships, it could have an adverse impact on our business and financial results.

Our information technology systems require that we integrate the platforms hosted by certain third-party service providers. We are responsible for integrating these platforms and updating them to maintain proper functionality. Issues with these integrations, our failure to properly update third-party platforms or any interruptions to our internal enterprise systems could harm our business by causing delays in our ability to quote, activate service for and bill new and existing customers on our platform.

We face a variety of risks associated with our used car inspection and certification operations.

We are subject to a variety of risks associated with our used car inspection and certification operations. If we are unable to operate our used car inspection and certification services efficiently, it may result in delivery delays, delays in listing vehicles on our platform, additional expenses and the loss of potential and existing partners and wholesale sellers and subsequent revenues, which could have a material adverse effect on our business, financial condition and results of operations. Additionally, if our used car inspection results are not accurate or if we fail to thoroughly inspect the vehicles pursuant to the agreed-upon standards and requirements, we may incur additional liabilities ranging from return of inspection fees to ultimate buyback of the vehicle inspected. We have also experienced, and may continue to experience, rising costs in connection with our used car inspection and certification operations. Such rising costs may continue to negatively affect our business, financial condition and results of operations.

Further, in certain locations, we currently outsource some used car inspection and certification services to third-party providers. If we are unable to maintain our relationship with our third-party service providers, such service providers could cease to provide the services we need. Additionally, if such service providers are unable to effectively deliver services to our standards on time and at the prices we have agreed upon, and we are unable to contract with alternative vendors or replace such service providers with our in-house specialists, we could experience delivery delays, a decrease in the quality of our reconditioning services, delays in listing vehicles consigned to us for sale and

increased time to sale, and additional expenses and loss of potential and existing corporate vehicle sourcing partners and retail sellers and subsequent revenues, which could have a material adverse effect on our business, financial condition and results of operations.

Failure to maintain or enhance customer trust in us could damage our reputation, or reduce or slow down the growth of our customer base, which could harm our business, financial condition and results of operations.

Our reputation as a trusted provider of digitalization solutions and transaction services for dealers and OEMs in China is critical to our success. If we fail to maintain a high level of customer trust in our goods and services, our business, financial condition and results of operations could be materially and adversely affected. We have received in the past, and we may continue to receive in the future, communications or complaints alleging that our services are not functioning, cars listed on our platform are defective or inconsistent with the information provided on our platform, or the services provided by our third-party service providers are unsatisfactory to our customers. Such complaints may adversely affect our reputation and brand among our customers, which may further affect our business, financial condition and results of operations.

We work with third-party service providers and business partners. If third-party service providers and business partners we rely on discontinue their cooperation with us, our business can be materially and adversely affected. In addition, actions of third parties are outside of our control and such actions or our failure to effectively ensure the quality of services provided by third-party service providers could materially and adversely affect our reputation, business, financial condition and results of operations.

We rely on third-party service providers and business partners to support the services offered through our platform and to facilitate related transaction processes, including auto financing, logistics, title transfers and other after-sales services. In particular, we engage third-party carriers to transport vehicles between our customers, our facilities and end purchasers, primarily at the request of dealers. This exposes us to risks associated with vehicle transportation, including adverse weather conditions, traffic disruptions, changes in local and national regulations, vehicle accidents, fuel price fluctuations and the varying reliability and service quality of independent carriers. Any failure by third-party carriers to perform in accordance with our service standards could adversely affect customer experience and our reputation, and could materially and adversely affect our business and results of operations.

We also depend on a limited number of major customers and business partners for a significant portion of our revenues. If any significant customer or business partner terminates its relationship with us, materially reduces its use of our services or seeks less favorable commercial terms, our business, financial condition and results of operations could be materially and adversely affected.

We carefully select our third-party service providers and business partners, but we are not able to control their actions. If these third parties fail to perform as we expect, experience difficulty meeting our requirements or standards, fail to conduct their business ethically, fail to provide satisfactory services to our customers, receive negative press coverage, violate applicable laws or regulations, or breach the agreements with us, or if the agreements we have entered into with the third parties are terminated or not renewed, our business and reputation could be damaged. In addition, if such third-party service providers cease operations, temporarily or permanently, face financial distress or other business disruptions, or increase their fees, or if our relationships with them deteriorate, we could suffer from increased costs, be involved in legal or administrative proceedings with or against our third-party service providers and experience delays in providing customers with similar services until we find or develop a suitable alternative. In addition, if we are not successful in identifying high-quality partners, establishing cost-effective relationships with them or effectively managing these relationships, our business, financial condition and results of operations would be materially and adversely affected.

We provide trainings to our third-party service providers and require them to act in line with our operating and customer servicing standards. However, if these third-party service providers fail to maintain a high level of performance that is consistent with our requirements, or if we fail to effectively ensure the quality of services provided by these third-party providers, the level of customer satisfaction and trust we enjoy may be harmed, and our business, financial condition and results of operations may be adversely affected.

We rely, in part, on our marketing efforts for customer acquisition and achieving a high level of brand recognition. If we fail to conduct our marketing activities effectively and efficiently, our business could be harmed.

We will continue to invest financial and other resources in marketing initiatives to grow our customer base. We currently carry out our marketing activities mainly by word-of-mouth referrals among dealers and business development efforts targeted at larger OEMs. We face intense competition from our competitors who may have greater marketing resources than we do. If we fail to conduct our marketing activities effectively and efficiently, or if our traffic acquisition efforts and marketing campaigns are not successful, our growth, business, financial condition and results of operations could be materially and adversely affected.

Negative media coverage related to our business or related parties, regardless of its validity, could adversely affect our business, financial condition and results of operations.

We believe that the recognition and reputation of our brands among dealers, OEMs, and customers and the industry in general have significantly contributed to the success of our business. Continuing to maintain, protect and strengthen our brands is critical to our market position. Maintaining and strengthening our brands will likely depend significantly on our ability to provide high-quality services on our platform. If we fail to maintain a strong brand, our business, financial condition and results of operations will be materially and adversely affected.

Our reputation and brands may be impacted by various factors, some of which are difficult or impossible to predict and control and costly or impossible to remediate. Negative publicity or media coverage of our business, our industry, our affiliates, our related parties, our employees, our third-party service providers and business partners, our directors and management or our shareholders, including, without limitation, alleged failure to comply with applicable laws and regulations, alleged fraudulent car listings, alleged misconduct or fraudulent activities by our employees, other business partners on our platform or companies that are or may be considered to be associated with us, alleged misrepresentation by our sales consultants or third-party service providers, alleged misleading representation of contents available on our platform, alleged unethical business practices, alleged opaque price and transaction process, rumors or negative coverage relating to our business, industry and other industry participants in general, breach of data security, failure to protect user privacy, inappropriate business practices, disclosure of inaccurate operating data, and negative information on blogs and social media websites, regardless of its validity, could damage our reputation. These allegations, even if factually incorrect or based on isolated incidents, may lead to inquiries, regulatory investigations or legal actions against us. Such actions could substantially damage our reputation and cause us to incur significant costs to defend ourselves.

If we fail to correct or mitigate misinformation or negative information about us, including information spread through social media or traditional media channels, customer trust in us may be undermined, which would have a material adverse effect on our business, financial condition and results of operations.

Market acceptance of our services may be influenced by a limited number of automobile OEMs, and we may not be able to maintain or grow these relationships with these OEMs.

Although the automotive industry is fragmented, a relatively small number of OEMs may have the ability to exert significant influence over the market acceptance of our services, especially for our new car-related services provided to OEMs, due to their influences within the automobile industry and car dealer community, their concentrated purchasing activities, the visibility of their endorsement or recommendation of specific services, and their ability to define technical standards and marketing guidelines, among others. While automotive dealers are generally free to purchase the solutions of their choosing, if an OEM has endorsed or certified a provider of products or services to its associated or franchised dealers and if our services lack such certification or endorsement, the adoption or retention of our services could be materially impaired.

We may require additional capital to pursue our business objectives and respond to business opportunities, challenges or unforeseen circumstances. If we are unable to generate sufficient cash flows or if capital is not available to us, our business, operating results, financial condition and prospects could be adversely affected.

If we are unable to generate sufficient cash flows, we would require additional capital to pursue our business objectives and respond to business opportunities, challenges, unforeseen circumstances, or other macroeconomic issues as well as to make marketing expenditures to improve our brand awareness, develop new services, further improve our platform and existing services, build and maintain our offline facilities, enhance our operating infrastructure, and acquire complementary businesses and technologies. Accordingly, we may need to engage in equity or debt financings to secure additional funds. However, additional funds may not be available when we need them on terms that are acceptable to us or at all. Volatility in equity and credit markets, including due to macroeconomic conditions, may also have an adverse effect on our ability to obtain equity or debt financing. Our inability to obtain adequate financing or financing on terms that are satisfactory to us when we require it could significantly limit our ability to continue to pursue our business objectives and to respond to business opportunities, challenges, or unforeseen circumstances, and may adversely affect our business, operating results, financial condition and prospects.

If we raise additional capital, it may dilute our shareholders’ ownership in us or cause our shareholders to be subordinated to the rights of senior security holders.

We may need to raise additional funds through public or private debt or equity financings in order to meet various objectives, such as:

•        acquiring businesses, customers, technologies and services;

•        taking advantage of growth opportunities, including more rapid expansion;

•        making capital improvements to increase our capacity;

•        developing new services or funding service development requirements; and

•        responding to competitive pressures.

Any additional capital raised through the sale of equity, or convertible debt securities, may dilute our stockholders’ respective ownership percentages in us. Furthermore, any additional debt or equity financing we may need may not be available on terms favorable to us, or at all. If future financing is not available or is not available on acceptable terms, we may not be able to raise additional capital, which could significantly limit our ability to implement our business plan and grow our business.

Our indebtedness could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or other industry and prevent us from making payments on the debt.

We have incurred and may in the future incur additional indebtedness. Our ability to generate sufficient cash flow from operations to make scheduled payments on our debt will depend on a range of economic, competitive, regulatory and business factors, many of which are outside our control. Our business may not generate sufficient cash flow from operations to meet our debt service and other obligations, and currently anticipated cost savings and operating improvements may not be realized on schedule, or at all. If we are unable to meet our expenses and debt service and other obligations, we may need to refinance all or a portion of our indebtedness on or before maturity, reduce or discontinue dividends we may pay in the future, reduce or delay business activities, investments or capital expenditures, sell assets or raise equity. These alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations, or we may not be able to effect these actions on commercially reasonable terms or at all, which could cause us to default on our obligations and impair our liquidity. Our inability to generate sufficient cash flow to satisfy our debt obligations, or to refinance our obligations on commercially reasonable terms, would have a material adverse effect on our business, prospects, financial condition and results of operations.

Our indebtedness could have important consequences, including the following:

•        it may limit our ability to borrow money (if necessary) for our working capital, capital expenditures, debt service requirements, strategic initiatives (including acquisitions) or other purposes;

•        it may make it more difficult for us to satisfy our overall obligations with respect to our indebtedness, and any failure to comply with the obligations of any of our debt instruments, including restrictive covenants and borrowing conditions, could result in an event of default under the agreements governing such indebtedness, which could further result in an event of default under other instruments due to cross-default and cross-acceleration provisions in such instruments;

•        a portion of our cash flow from operations will be dedicated to the payment of principal of, and interest on, our indebtedness, including short-term loans, operating lease liabilities and amounts due to related parties and so will not be available for operations, future business opportunities, potential dividends to our stockholders or other purposes;

•        it may limit our flexibility in planning for, or reacting to, changes in our operations or business;

•        we will be more highly leveraged than some of our competitors, which may place us at a competitive disadvantage;

•        it may make us more vulnerable to downturns in our business or the economy generally;

•        it may restrict us from making strategic acquisitions, introducing new technologies or exploiting business opportunities; and

•        it may limit, along with the financial and other restrictive covenants in our indebtedness, among other things, our ability to borrow additional funds or dispose of assets.

We could be liable for contract, product liability or other claims, and disputes over such claims may disrupt our business and have a negative impact on our financial results.

We provide limited warranties to customers using our services. In addition, errors, defects or other performance problems in our services, including with respect to data that we store, process and provide in connection with our services, could result in financial or other damages to our customers or consumers. For instance, we currently have some contract disputes such as, among others, vehicle

custody, detection and auction contract disputes, with our customers during our ordinary course of business that result in litigations. There can be no assurance that any limitations of liability set forth in our contracts would be enforceable or would otherwise protect us from liability for damages. We maintain insurance coverage for our used car inspection and certification operations; however, there can be no assurance that this coverage will continue to be available on acceptable terms, in sufficient amounts to cover one or more large claims or at all, or that the insurer will not deny coverage for any future claim. The successful assertion of one or more large claims against us that exceeds available insurance coverage, or the occurrence of changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, could have a material adverse effect on our business, financial condition and results of operations. Furthermore, any litigation, regardless of its outcome, could result in substantial cost to us and divert management’s attention from our operations and could have a material adverse effect on our business, financial condition and results of operations. In addition, some of our services are business-critical for our customers, and a failure or inability to meet a customer’s expectations could seriously damage our reputation and negatively impact our ability to retain existing business or attract new business.

Furthermore, in relation to certain used car auctions facilitated through our platform, we rely on the sellers’ representations and warranties stated in the relevant contracts regarding their ownership of the vehicles and their rights to dispose of them. However, if any of the sellers are found to have unlawfully disposed of vehicles on our platform without proper legal rights, or if our practice of relying primarily on the sellers’ representations and warranties is deemed non-compliant with applicable laws and regulations, we may become involved in disputes and be obligated to provide compensation or be subjected to regulatory sanctions or penalties.

Our business depends substantially on the continuing efforts of our directors, executive officers and other key persons. If we lose their services, our business operations and growth prospects may be materially and adversely affected.

Our future success depends substantially on the continuing efforts of our directors, executive officers and key persons. In particular, we rely on the leadership, expertise, experience and vision of our directors and senior management team. If one or more of our directors, executive officers or other key persons are unable or unwilling to continue their services for us, whether due to resignation, accident, health condition, family considerations or any other reason, we might not be able to find their successors in a timely manner or at all. Since the markets in which we operate are characterized by high demand and intense competition for talent, we cannot assure you that we will be able to attract or retain qualified management or other highly skilled employees. Competition for qualified personnel is often intense in the industry we operate. If we are unable to recruit, train and retain qualified managerial or other employees, our brand and our business may be materially and adversely affected.

We do not have key man insurance for our directors, executive officers or other key persons. If any of our key persons terminate his or her services or otherwise becomes unable to provide continuous services to us, our business may be severely and adversely affected, our financial condition and results of operations may be materially and adversely affected and we may incur additional expenses to recruit, train and retain qualified personnel. Each of our executive officers and key employees has entered into an employment agreement with a noncompete clause with us. However, these agreements may be breached by the counterparties, and there may not be adequate and timely remedies available to us to compensate our losses arising from the breach. We cannot assure you that we would be able to enforce these noncompete clauses. If any of our executive officers or key persons joins a competitor or forms a competing company, we may lose customers, know-hows and key professionals and staff members.

Our business is susceptible to misconduct, improper business practices and other fraudulent conduct by or between our employees and third parties.

We rely on our employees or other third-party contractors to carry out our operating objectives and are exposed to many types of operational risks, including the risk of misconduct and errors by our employees. Our business depends on our employees to interact with potential customers, conduct car inspection, process a large number of transactions and provide support for other key aspects of our business, all of which involve the use and disclosure of personal information and are susceptible to human errors on the part of our employees.

We could be materially and adversely affected if transactions were redirected, misappropriated or otherwise improperly executed, if personal information was disclosed to unintended recipients or if an operational breakdown or failure occurred when processing transactions, whether as a result of human error, purposeful sabotage or fraudulent manipulation of our operations or systems.

Although we provide periodic and solid trainings to all our employees and protocols to third-party contractors, it is not always possible to identify, deter or prevent their misconduct or errors, and the precautions we take to detect and prevent potential misconducts and human errors may not be completely effective in controlling risks or losses. If any of our employees or third-party contractors takes, converts or misuses funds, documents or data or fails to follow protocols when interacting with customers or among themselves, we could be liable for damages and subject to regulatory actions and penalties. We could also be perceived to have facilitated or participated in the illegal misappropriation of funds, documents or data, or failed to follow applicable protocols, and therefore be subject to civil or criminal liability. Our employees or third-party contractors may also engage in improper business practices and other fraudulent conduct with third parties. As a result of these potentially damaging activities, we could incur significant losses, which could have a material adverse effect on our business, financial condition and results of operations.

Our business has been, and may continue to be, adversely affected by public health events and other external disruptions.

Public health events, natural disasters and other external disruptions beyond our control have in the past materially affected, and may in the future materially affect, our business and results of operations. For example, the COVID-19 pandemic disrupted our operations, required our employees to work remotely and adversely affected car shopping by consumers and the operations of car dealerships. During that period, we offered more favorable credit terms to certain customers and observed an increase in account delinquencies. Any similar disruption in the future may result in restrictions on our ability and the ability of our customers to conduct business, decreased consumer demand for vehicle purchases, deterioration in our customers’ financial condition and ability to pay for our services, and declines in our revenue. If we implement cost-saving measures in response to such disruptions, we may face unintended consequences, including the loss of key employees and increased hiring costs. We cannot predict the nature, timing or severity of any future disruptions, or their ultimate impact on our business, financial condition and results of operations.

We utilize some open-source software, and any failure to comply with the terms of one or more of these open-source licenses could negatively affect our business.

We use open-source software in our services and expect to use open-source software in the future. The terms of various open-source licenses have not been interpreted by Chinese courts, and there is a risk that such licenses could be construed in a manner that imposes unanticipated conditions or restrictions on our ability to market our platform. Under the terms of certain open-source licenses, if we combine our proprietary software with open-source software in a certain manner, we could be required to release the source code of our proprietary software and to make our proprietary software available under open-source licenses. If portions of our proprietary software are determined to be subject to an open-source license, we could be required to publicly release the affected portions of our source code, or to reengineer all or a portion of our technologies or otherwise be limited in the

licensing of our technologies, each of which could reduce or eliminate the value of our technologies and services. In addition to risks related to license requirements, usage of open-source software can lead to greater risks than use of third-party commercial software, as open-source licensors generally do not provide warranties or controls on the origin of the software. Many of the risks associated with usage of open-source software cannot be eliminated and could negatively affect our business and operating results.

We cannot assure you that we will not be subject to liability claims or legal or regulatory liability for any inappropriate or illegal content, which could subject us to liabilities and cause damages to our reputation.

The information displayed on our websites and various mobile applications may include content generated by our users and other third-party sources, which we do not independently verify. Failure to identify and fully appreciate such risks will negatively affect our reputation, client relationship, operations and prospects.

Although we implement various monitoring procedures to identify and remove inappropriate or illegal content, we cannot assure you that there will be no inappropriate or illegal content included in our websites and mobile applications. We may face civil, administrative or criminal liability or legal or regulatory sanctions, such as requiring us to restrict or discontinue our content or services, if an individual or corporate, governmental or other entity believes that any of the content on our websites and mobile applications violates any laws, regulations or governmental policies or infringes upon its legal rights. Even if such a claim were not successful, defending such a claim may cause us to incur substantial costs. Moreover, any accusation of inappropriate or illegal content in our content offerings could lead to significant negative publicity, which could harm our reputation, business, financial condition and results of operations.

The automobiles in our warehouses and other facilities may be stolen, vandalized or suffer weather-related damages. If any of these happens, our reputation, business and operating results may be adversely affected.

As part of our delivery services, we place automobiles from our customers in parking spaces and warehouses we rent from third parties. We may not be able to properly store these automobiles before they are purchased by consumers or disposed of. The automobiles stored at our parking space and warehouses may be stolen, vandalized or suffer weather-related damages. Furthermore, our customers or ultimate consumers may dispute as to whether we have properly stored and delivered their vehicles. If any of these were to occur, we may suffer losses and our brand image and relationship with customers may be harmed.

Failure to obtain licenses, permits and approvals from, or complete filings with, competent regulatory authorities required for our business operations may materially and adversely affect our business, financial condition and results of operations.

We are required to obtain various licenses, permits and approvals or complete necessary filings with the competent regulatory authorities in connection with our business operations under the applicable PRC laws and regulations. To obtain and maintain these licenses, permits and approvals or to complete such filings, we must demonstrate satisfactory compliance with the applicable laws and regulations to the competent regulatory authorities.

•   We operate our online platform through which we offer a diverse range of services, features and functions. We have obtained certain value-added telecommunications service licenses (the “ICP Licenses”) to operate our online platform in accordance with PRC laws and regulations. However, due to uncertainties in the interpretation and implementation of PRC laws and regulations and the enforcement practices of relevant government authorities, we cannot guarantee that we have obtained all the necessary licenses, permits or approvals, or have completed all the necessary filings, for our services, features and functions. For instance, to

enhance user experience, we allow users to engage in car transactions and make deposits on our platform. These transaction offerings may constitute “e-commerce services” under the PRC laws and regulations, which would require us to obtain a value-added telecommunications service license for an online data processing and transaction processing business (an “EDI License”). While we currently hold the required EDI Licenses, we have historically operated the aforesaid services without holding the required EDI Licenses, and we cannot assure you that we will not be penalized for such historical non-compliant practices. Any such penalties imposed on us may adversely affect our business, results of operations and financial condition. We also enable instant communication and transaction between users within our mobile applications and allow users to discuss car listing information as well as warehousing and delivery details in real time. These services may constitute “instant communication services,” which we may be required to expand the scope of our ICP License to cover. However, we cannot assure you that we are able to complete the update in a timely manner, or at all. Any failure by us to operate with the required licenses or within the permitted scope of business outlined in the licenses we have may subject us to confiscation of illegal income, fines, penalties and regulatory actions. In severe cases, it may lead to the closure of relevant business operations, which could significantly harm our business, financial condition and results of operations. Meanwhile, certain of our PRC operating entities historically offered services that required ICP Licenses without obtaining such required licenses. As of the date of this prospectus, these operating entities have either discontinued such operations or transferred the relevant businesses to our other operating entities that have obtained the proper licenses. However, we cannot assure you that we will not be penalized for our historical noncompliance, in which case our business, results of operations and financial condition may be adversely affected.

•        We have historically offered articles and videos relating to the automobile market for which we may be required by the competent regulatory authorities to obtain additional licenses, permits or approvals that we currently do not possess. As of the date of this prospectus, we have discontinued the offerings of the foregoing articles and videos relating to the automobile market on our online platforms and are not aware of any action, claim, or investigation being conducted or threatened by the competent regulatory authorities relating to our failure to obtain necessary licenses, permits or approvals for any of the above-mentioned offerings. However, in the event that our historical practices were considered non-compliant with relevant PRC laws and regulations, we may be subject to fines, suspension of business, confiscation of relevant equipment and other administrative penalties, which may adversely affect our business, financial condition and results of operations.

•   We have utilized a payment structure for our auction and certain other services where we received payments from buyers for used cars listed on our platform, and then settled with the sellers through our own account. We are able to deduct fees related to used car inspection and certification and other transaction services that we provide to the buyers and/or the sellers directly from the payments made by buyers before we settle payments with the sellers. The People’s Bank of China, or the PBOC, generally prohibits nonfinancial institutions from engaging in payment or settlement services without obtaining the necessary payment business license. Since June 2022, we have engaged a third-party financial institution that possesses the required payment business license to handle payments for our users. We plan to cease our own settlement practices gradually and rely solely on the financial institution for settlement. However, there remains a possibility that our practices could be subject to enforcement actions, in which case our reputation, business and results of operations may be adversely affected. If the PBOC or other regulatory authorities determine that our past or current payment practices do not comply with applicable laws and regulations, we may face regulatory actions, investigations, fines and penalties, which could significantly harm our business, financial condition and results of operations.

•   Historically, certain of our PRC operating entities were engaged in the used car-related business but did not complete necessary filings with the Ministry of Commerce of the PRC, or MOFCOM, at the provincial level as required under current PRC laws and regulations. As of the date of this prospectus, these operating entities either completed the necessary filings or discontinued such operations. However, we cannot assure you that we will not be penalized for our historical noncompliance and any such penalty may adversely affect our business, results of operations and financial condition.

•        Moreover, we have historically failed to fulfill the required fire protection procedures, specifically the filing of fire control acceptance, for certain of our offline stores. This non-compliance with fire-related regulatory requirements exposes us to the potential risk of penalties and legal consequences, including administrative fines and orders to suspend the operation of affected premises. Besides, a number of our PRC subsidiaries have historically been fined for their failure to meet applicable fire-related regulatory requirements.

There is uncertainty surrounding the interpretation and implementation of current and future laws and regulations that govern our business activities. If we fail to complete, obtain, maintain, or renew any required licenses, permits or approvals or make necessary filings, we may be subject to various penalties, such as the confiscation of illegal gains, fines, and the discontinuation or restriction of our operations. These penalties may disrupt our business operations and have a material adverse effect on our business, financial condition and results of operations.

Any failure by us or our business counterparties to comply with applicable anti-money laundering laws and regulations could damage our reputation.

We and our business counterparties are subject to anti-money laundering obligations under applicable anti-money laundering laws and regulations and are regulated in that respect by the PBOC. If we or any of our business counterparties fail to comply with such laws and regulations, our reputation could suffer and we could become subject to regulatory action, which could have a material adverse effect on our business, financial condition and results of operations. Any negative perception of the industry, such as that arises from any failure of other loan referral service providers, consumer finance marketplaces or e-commerce platform for buying and selling used cars to detect or prevent money laundering activities, even if factually incorrect or based on isolated incidents, could compromise our image or undermine the trust and credibility we have established.

We may be subject to intellectual property infringement claims or other allegations by third parties, which may materially and adversely affect our business, results of operations and prospects.

We depend to a large extent on our ability to develop and maintain the intellectual property rights relating to our technology and online businesses. We have devoted considerable resources to the development and improvement of our car inspection technology and digitalization capabilities, mobile applications, mobile sites and websites and information technology systems. We cannot be certain that third parties will not claim that our business infringes upon or otherwise violates patents, trademarks, copyrights or other intellectual property rights that they hold. Companies operating online businesses and providing technology-based services are frequently involved in litigation related to allegations of infringement of intellectual property rights. The validity, enforceability and scope of protection of intellectual property rights in China are still evolving. We were subject to several trademark claims in the past and may in the future be subject to intellectual property infringement claims from time to time. As we face increasing competition and as litigation becomes a more common method for resolving commercial disputes in China, we face a higher risk of being the subject of intellectual property infringement claims.

Defending against intellectual property claims is costly and can impose a significant burden on our management attention and resources, and favorable final outcomes may not be obtained in all cases. Such claims, even if they do not result in liability, may harm our reputation. Any resulting

liability or expenses, or changes required to our services to reduce the risk of future liability, may have a material adverse effect on our business, results of operations and prospects.

We may be unable to adequately protect, and may incur significant costs in defending, our intellectual property and other proprietary rights, which could negatively impact our businesses.

We believe our patents, trademarks, software copyrights, trade secrets, brand and other intellectual property rights and proprietary information are critical to our success. Any unauthorized use of intellectual property rights and proprietary information could harm our business, reputation and competitive advantages. We rely on a combination of patent, trademark, trade secret and copyright law, our internal control mechanism, and contractual arrangements to protect our intellectual property.

Legal protection may not always be effective. Infringement of intellectual property rights continues to pose a risk in doing business. Monitoring and preventing unauthorized use is difficult. Furthermore, like many other countries where legal systems are developing, the application of laws governing intellectual property rights in China involves uncertainties and continues to evolve, which could involve risks to us. The practice of intellectual property rights enforcement action by Chinese regulatory authorities is in its early stage of development as in many other countries. In the event that we have to resort to litigation and other legal proceedings to enforce our intellectual property rights, such action, litigation or other legal proceedings could result in substantial costs and diversion of our management’s attention and resources and could disrupt our business. There is no assurance that we will be able to enforce our intellectual property rights effectively or otherwise prevent others from the unauthorized use of our intellectual property.

We try, to the extent possible, to protect our intellectual property, technology and confidential information by requiring our employees, third-party service providers and consultants to enter into confidentiality and assignment of inventions agreements. Due to potential willful or unintentional conduct of personnel who have access to our confidential and proprietary information, these agreements and control measures may not effectively prevent unauthorized disclosure or use of our confidential information, or unauthorized use of our intellectual property or technology, and may not provide an adequate remedy in the event of such unauthorized disclosure or use. The enforceability of confidentiality agreements may vary from jurisdiction to jurisdiction. Failure to obtain or maintain trade secrets and/or confidential know-how protection could adversely affect our competitive position.

Competitors may adopt service names or trademarks that are similar to ours, thereby harming our ability to build brand identity and possibly leading to user confusion. Our competitors may independently develop substantially equivalent proprietary information and may even apply for patent protection. If successful in obtaining such patent protection, our competitors could limit our use of our trade secrets and confidential know-how, and our financial condition and operating results would be adversely affected.

Increases in labor costs, including wages, and enforcement of stricture labor laws and regulations in the PRC, could adversely affect our business, financial condition and results of operations.

China’s overall economy and the average wage in China have increased in recent years and are 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 those who pay for our services, our profitability and results of operations may be materially and adversely affected.

In addition, we have been subject to certain regulatory requirements in terms of entering into labor contracts with our employees and paying various statutory employee benefits, including pensions, housing fund, 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 certain requirements in terms of signing labor contracts, minimum wages, paying remuneration, determining the term of employees’ 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, financial condition and results of operations.

As the interpretation and implementation of labor-related laws and regulations may further evolve, we cannot assure you that our 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. We cannot assure you that we have complied or will be able to comply with all labor-related law and regulations regarding those relating to obligations to make social insurance payments and contribute to the housing funds. If we are deemed to have violated relevant labor laws and regulations, we could be required to provide additional compensation to our employees and our business, financial condition and results of operations will be adversely affected.