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1、F-1/A 1 formf-1a.htm As filed with the U.S.Securities and Exchange Commission on January 14,2025 Registration No.333-283112 UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549 Amendment No.1toFORM F-1 REGISTRATION STATEMENTUNDERTHE SECURITIES ACT OF 1933 KNOREX LTD.(Exact name of reg
2、istrant as specified in its charter)Cayman Islands 7370 Not Applicable(State or Other Jurisdiction ofIncorporation or Organization)(Primary Standard IndustrialClassification Code Number)(I.R.S.EmployerIdentification Number)21 Merchant Road,#04-01 Singapore 058267+65 6956-7483(Address,including zip c
3、ode,and telephone number,including area code,of registrants principal executive offices)Cogency Global Inc.122 East 42nd Street,18th FloorNew York,NY 10168(800)221-0102(Name,address,including zip code,and telephone number,including area code,of agent for service)Copies to:Louise L.Liu,Esq.Morgan,Lew
4、is&Bockius19th Floor,Edinburgh Tower,The Landmark15 Queens Road CentralHong Kong SARTel.:+852 3551-8500 Joan Wu,Esq.Hunter Taubman Fischer&Li LLC950 Third Avenue,19th FloorNew York,NY 10022Tel.:(212)530-2208 Approximate date of commencement of proposed sale to the public:As soon as practicable after
5、 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 of1933,check the following box.If this Form is filed to register additional securities for an off
6、ering pursuant to Rule 462(b)under the Securities Act,check the following box and list theSecurities 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 Ac
7、t,check the following box and list the Securities Actregistration 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 Ac
8、tregistration statement number of the earliest 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 i
9、ts financial statements in accordance with U.S.GAAP,indicate by check mark if the registrant has electednot to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B)ofthe Securities Act.The term“new or revised f
10、inancial accounting standard”refers to any update issued by the Financial Accounting Standards Board to its AccountingStandards Codification after April 5,2012.The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until theRegi
11、strant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordancewith Section 8(a)of the Securities Act of 1933,as amended or until the registration statement shall become effective on such date as the Securitiesand Excha
12、nge Commission,acting pursuant to such Section 8(a),may determine.EXPLANATORY NOTE This registration statement contains two prospectuses,as set forth below.Public offering prospectus.A prospectus to be used for the initial public offering by us of 3,000,000 of our Class A ordinary shares(the“IPO”),o
13、rthe public offering prospectus,through the underwriters named in the“Underwriting”section of the public offering prospectus.Resale prospectus.A prospectus to be used for the potential resale by our existing shareholders,Ponlaphat Akaratharaseth,Yvonne Lee,Zeng Li Renand Peh Ee Hong(the“Resale Share
14、holders”)of 787,250 of our Class A ordinary shares.The resale prospectus is substantively identical to the public offering prospectus,except for the following principal points:they contain different front covers;all references in the public offering prospectus to“this offering”will be changed to“the
15、 IPO,”defined as the underwritten initial public offering ofour Class A ordinary shares,in the resale prospectus;all references in the public offering prospectus to“underwriters”will be changed to“underwriters of the IPO”in the resale prospectus;the“Capitalization”and“Dilution”sections from the publ
16、ic offering prospectus are are deleted from the resale prospectus;they contain different“Use of Proceeds”section;a“Resale Shareholders”section is included in the resale prospectus;they contain different“The Offering”section;the section“Shares Eligible for Future Sale Resale Prospectus”from the publi
17、c offering prospectus is deleted from the resale prospectus;the“Underwriting”section from the public offering prospectus is deleted from the resale prospectus and a“Plan of Distribution”section is insertedin its place;the“Legal Matters”section in the resale prospectus deletes the reference to counse
18、l for the underwriters;andthey contain different back covers.The registrant has included in this registration statement a set of alternate pages after the back cover page of the public offering prospectus,or the AlternatePages,to reflect the foregoing differences in the resale prospectus as compared
19、 to the public offering prospectus.The public offering prospectus will excludethe Alternate Pages and will be used for the public offering by the registrant.The resale prospectus will be substantively identical to the public offeringprospectus except for the addition or substitution of the Alternate
20、 Pages and will be used for the resale offering by the Resale Shareholders.The information in this preliminary prospectus is not complete and may be changed.We may not sell these securities until the registrationstatement filed with the Securities and Exchange Commission is effective.This preliminar
21、y prospectus is not an offer to sell these securities and it isnot soliciting an offer to buy these securities in any jurisdiction where such offer or sale is not permitted.SUBJECT TO COMPLETION PRELIMINARY PROSPECTUS DATED ,2025 KNOREX LTD.3,000,000 Class A Ordinary Shares This is the initial publi
22、c offering of Class A ordinary shares,par value US$0.0005 per share,of KNOREX LTD.We are offering 3,000,000 Class Aordinary shares.The Resale Shareholders are offering an additional 787,250 Class A ordinary shares.We will not receive any of the proceeds from the sale ofthe Class A ordinary shares by
23、 the Resale Shareholders.Prior to this offering,there has been no public market for our ordinary shares.We anticipate that the initial public offering price will be betweenUS$4.00 and US$5.50 per Class A ordinary share.We intend to apply to list our Class A ordinary shares on the NYSE American Marke
24、t,or NYSE American,under the symbol KNRX.No assurance canbe given that our application will be approved or that a trading market for our ordinary shares,will develop.This offering will not proceed unless ourordinary shares are accepted for listing on the NYSE American.Upon the completion of this off
25、ering,we will have 30,258,400 ordinary shares issued and outstanding,comprised of 25,477,825 Class A ordinary sharesand 4,780,575 Class B ordinary shares,assuming the underwriters do not exercise their option to purchase additional Class A ordinary shares.Holders of ourClass A ordinary shares and Cl
26、ass B ordinary shares will have the same rights except for voting and conversion rights.Upon the date that is five years afterthe date of issuance all Class B ordinary shares shall be automatically and immediately converted into Class A ordinary shares at a 1:1 ratio,unless holders ofClass A ordinar
27、y shares and Class B ordinary vote prior to that to extend the conversion date.Upon any transfer of Class B ordinary shares,they shall beautomatically and immediately converted into an equal number of Class A ordinary shares.Class A ordinary shares are not convertible into Class B ordinaryshares und
28、er any circumstances.Each Class A ordinary share shall entitle the holder to one vote and each Class B ordinary share shall entitle the holder tofive votes on all matters subject to vote at our general meetings,except that Class A ordinary share and Class B ordinary share shall each entitle the hold
29、er toone vote in relation to any resolutions to be passed for the purpose of extending the conversion date of the Class B ordinary shares as discussed above See“Description of Share CapitalOrdinary Shares”for more details.We will not be considered a“controlled company”under NYSE American corporatego
30、vernance rules as we do not currently expect that more than 50%of our voting power will be held by an individual,a group or another companyimmediately following the completion of this offering.We are an“emerging growth company”as defined in the Jumpstart Our Business Startups Act of 2012,as amended,
31、and a“foreign private issuer”underapplicable U.S.federal securities laws and,as such,are eligible for reduced public company reporting requirements.See“Prospectus Summary Implications of Being an Emerging Growth Company”and“Prospectus Summary Implications of Being a Foreign Private Issuer”beginning
32、on page 8 ofthis prospectus for more information.KNOREX LTD.was incorporated as an exempted company under the laws of the Cayman Islands without any operations of its own.We conduct ouroperations primarily in the United States,Singapore,Vietnam,India and Malaysia through our operating subsidiaries.T
33、he Class A ordinary shares offered inthis offering are shares of the Cayman Islands holding company,instead of shares of our operating subsidiaries.Investors in this offering will not directlyhold equity interests in our operating subsidiaries.This structure involves unique risks to investors.For a
34、detailed discussion of risks associated with ourcorporate structure,see“Risk Factors Risks Relating to Our Ordinary Shares and This Offering”beginning on page 28 of this prospectus.You should read this prospectus,together with additional information described under the heading“Where You Can Find Mor
35、e Information,”carefullybefore you invest in any of our securities.Investing in our securities involves a high degree of risks.See“Risk Factors”beginning on page 13 of this prospectus for a discussion ofinformation that should be considered in connection with an investment in our securities.Neither
36、the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities ordetermined if this prospectus is truthful or complete.Any representation to the contrary is a criminal offense.Per Share Total Initial public offering price US$US$Underwriting
37、 discount and commission(1)US$US$Proceeds,before expenses,to us US$US$(1)For additional information on underwriting compensation,see“Underwriting”beginning on page 94.We have granted Cathay Securities,Inc.a 45-day option to purchase from us up to an aggregate of 450,000 additional ordinary shares,re
38、presenting15%of the Class A ordinary shares sold in the offering,solely to cover over-allotments,if any,at the initial public offering price less theunderwriting discounts and commissions.The underwriters expect to deliver the Class A ordinary shares against payment in U.S.dollars in New York,New Yo
39、rk on or about,2025.Cathay Securities,Inc.PROSPECTUS DATED ,2025.TABLE OF CONTENTS PagePROSPECTUS SUMMARY5THE OFFERING10SUMMARY CONSOLIDATED FINANCIAL AND OPERATING DATA11RISK FACTORS13SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS AND INDUSTRY DATA35USE OF PROCEEDS36DIVIDEND POLICY37CAPITALIZATI
40、ON38DILUTION39ENFORCEABILITY OF CIVIL LIABILITIES40CORPORATE HISTORY AND STRUCTURE41MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS42BUSINESS55REGULATION62MANAGEMENT71PRINCIPAL SHAREHOLDERS76RELATED PARTY TRANSACTIONS77DESCRIPTION OF SHARE CAPITAL78SHARES ELIGIBL
41、E FOR FUTURE SALE86TAXATION88UNDERWRITING94EXPENSES OF THE OFFERING104LEGAL MATTERS105EXPERTS105WHERE YOU CAN FIND MORE INFORMATION105INDEX TO CONSOLIDATED FINANCIAL STATEMENTSF-1 You should rely only on the information contained in this prospectus or in any related free writing prospectus that we f
42、iled with the Securities andExchange Commission.We and the underwriters have not authorized anyone to provide any information other than that contained in this prospectus or in anyfree writing prospectus prepared by or on our behalf or to which we have referred you.We take no responsibility for and
43、can provide no assurance as to thereliability of,any other information that others may give you.We are offering to sell,and seeking offers to buy,the Class A ordinary shares only injurisdictions where such offers and sales are permitted.The information contained in this prospectus is accurate only a
44、s of the date of this prospectus,regardless of the time of delivery of this prospectus or the sale of any ordinary share.Neither we nor the underwriters have not taken any action to permit a public offering of the Class A ordinary shares outside the United States or topermit the possession or distri
45、bution of this prospectus outside the United States Persons outside the United States who came into possession of thisprospectus must inform themselves about and observe any restrictions relating to this offering of the Class A ordinary shares and the distribution of thisprospectus outside of the Un
46、ited States.Until,2025(the 25th day after the date of this prospectus),all dealers that buy,sell,or trade ordinary shares,whether or not participating in thisoffering,may be required to deliver a prospectus.This is in addition to the obligation of dealers to deliver a prospectus when acting as under
47、writers and withrespect to their unsold allotments or subscriptions.3Table of Contents Conventions That Apply to This Prospectus Unless otherwise indicated or the context otherwise requires and for purposes of this prospectus only:“Ad channel”or“advertising channel”means the medium used by the marke
48、ter to advertise.Examples of ad channel include social media,searchmarketing,CTV/OTT marketing,video marketing,audio marketing,display marketing,native display marketing,digital-out-of-home marketing,and email marketing;“AI/ML”means artificial intelligence and/or machine learning;“AMX”means advertis
49、ing management and execution,a term we use to represent a new category of software that provides end-to-end capabilitiesfor the modern digital advertising need;“API”means application programming interface;“B2B”means business-to-business where business is conducted between businesses,to be distinguis
50、hed from business to consumer;“CAGR”means compound annual growth rate;“Class A Ordinary Shares”means the Companys Class A ordinary shares of par value US$0.0005 each;“Class B Ordinary Shares”means the Companys Class B ordinary shares of par value US$0.0005 each;“CTV/OTT”means Connected Television(TV
51、),while OTT means for Over-the-Top.They both relate to how consumers are consuming TVcontent.CTV refers to televisions or devices that can connect to the Internet and stream digital content,for instance,smart TVs,gaming console,streaming players such as Apple TV or Roku.OTT refers to the delivery of
52、 film and TV content over the Internet,hence“over the top”of existingInternet infrastructure,directly to viewers.This includes streaming platforms like Netflix,Disney+,HBO Max,Prime Video,Viu,and others.;“India”means the Republic of India;“IT”means information technology;“Marketers”refers to adverti
53、sing agencies and brand advertisers;“Open Internet”refers to network of contents and media,outside of the Walled Gardens,which are built on the concept of neutrality where any useris free to access the open exchange of information across the web without much or any restrictions,commonly through the
54、use of a web browser.See the“Walled Garden”for comparison;“ROAS”means return on advertising spending,a metric that lets marketers measure the efficacy of an advertising campaign or advertising based onrevenue that is earned given the advertising budget being spent;“Securities Act”means the U.S.Secur
55、ities Act of 1933,as amended;“SEO”means searching engine optimization,an iterative practice of improving the quantity and quality of traffic to a website from search engines;“Singapore”means the Republic of Singapore;“S$”and“SGD”mean Singapore dollar(s),the lawful currency of Singapore;“UI”means use
56、r interface;“US$”and“USD”mean United States dollar(s),the lawful currency of the United States;“U.S.”or“United States”means the United States of America;“U.S.GAAP”means generally accepted accounting principles in the United States;“Walled Garden”or“Native Platforms”means a closed platform or ecosyst
57、em in which the provider fully controls the access to their applications,audience,content,and ad inventory.The typical way to access them is via the providers designated APIs often requiring various forms ofcertifications governed by the provider.Examples include Apples ecosystem,Metas Facebook and
58、Instagram,Googles YouTube and PlayStore,and so on.See the“Open Internet”for comparison;“XPO”or“Knorex XPO”refers to our company flagship platform.In this prospectus,unless the context otherwise requires,references to“Knorex,”“we,”“our,”“us,”“the Company,”“our Company,”“our Group,”ortheir other gramm
59、atical variations are to KNOREX LTD.,a Cayman Islands company,and its subsidiaries.Internet site addresses in this prospectus are included for reference only and the information contained in any website,including our website,is notincorporated by reference into,and does not form part of,this prospec
60、tus.The Company is an exempted company incorporated on May 9,2023,under the laws of the Cayman Islands with no substantial operations of its ownother than holding all the outstanding share capital of its subsidiaries.For the years ended December 31,2023 and 2022 and up to the date hereof,we havebeen
61、 conducting our business through Knorex Pte.Ltd.(“Knorex SG”),a company incorporated under the laws of Singapore,which owns 100%equityinterests in our operating subsidiaries in the United States,Malaysia,and China,and 99.99%and 99%,respectively,of the equity interests in our operatingsubsidiaries in
62、 India and Vietnam.The Company implemented a reverse capitalization on September 30,2024 by way of entering into a restructuringagreement with the shareholders of Knorex SG(“Reorganization”),upon the completion of which the current shareholders of Knorex SG and certain otherpersons became shareholde
63、rs of the Company and as of the date of this prospectus,the Reorganization was completed and the Company now owns 100%ofKnorex SG as the same shareholders effectively control our Group(including the Company and its subsidiaries)before and after the Reorganization,it hasbeen treated as a reorganizati
64、on of entities under common control,and our financial statements have accounted for the consolidation of the Company and itssubsidiaries at historical cost and have been prepared on the basis as if the Reorganization had become effective as of January 1,2021.For a detaileddiscussion,see note 1 to ou
65、r consolidated financial statements included in this prospectus.As of June 30,2024,the Company had 20 ordinary shares issued and outstanding,and Knorex SG had 1,090,336 outstanding ordinary shares on an as-converted basis.Following the completion of the Reorganization,the capital structure of the Co
66、mpany mirrors the current capital structure of Knorex SG ona beneficial shareholder basis.4Table of Contents PROSPECTUS SUMMARY This summary highlights selected information from this prospectus.It may not contain all the information that is important to you.You should carefullyread the entire prospe
67、ctus and the other documents referred to in this prospectus before making an investment in our Class A Ordinary Shares.You shouldcarefully consider,among other things,our consolidated financial statements and the related notes and the sections titled“Risk Factors,”“Business”and“Managements Discussio
68、n and Analysis of Financial Condition and Results of Operations”included elsewhere in this prospectus.For additionalinformation,see“Where You Can Find More Information”in this prospectus.Overview We are a B2B technology company specializing in providing programmatic advertising products and solution
69、s to marketers to streamline and automatetheir advertising and marketing workflows.Our software offers marketers cost-effective solutions and productivity-enhancing capabilities to target theirdesired audience across various advertising channels and devices through automated processes and algorithms
70、,which is known as“programmaticadvertising”in our industry.Leveraging our proprietary AI/ML technology and steered by the marketers directive,our cloud-based software canautonomously execute split-second advertisement purchasing transactions,strategically acquiring advertising placements and optimiz
71、ing onlineadvertisement from the global advertisement and data marketplaces using the insights gleamed from diverse data points consolidated across various adchannels,including the Open Internet and the Walled Gardens.It is critical for marketers to connect to as many online ad channels as possible
72、to attain thesufficient reach to engage with their desired audience at the right time to effectively promote their products and services.However,advertising to two ormore of these disparate and siloed ad channels and to enable tracking between offline and online channels,or“omni-channel advertising”
73、,is a complex andcostly operation.Our mission is to simplify the increasingly complex digital marketing landscape to help accelerate our customers business growth througha data-driven approach.Our flagship product,Knorex XPOSM,is a self-service enterprise-grade cloud platform with a comprehensive su
74、ite of advertising management andexecution(AMX)applications.Our highly differentiated platform empowers marketers to orchestrate omni-channel advertising across the Open Internet,andthe Walled Gardens or the Native Platforms owned by the big tech giants,and to streamline and automate manual processe
75、s to drive advertising efficiencyand performance.XPO enables intelligent automation and scaling,allowing marketers to seamlessly manage and control core mission-critical onlineadvertising processes from a centralized UI,to advertise across a diverse range of ad channels including search,social media
76、,apps,websites,desktop,mobile,smart TVs or connected televisions,streaming devices,and digital billboards.Our AI/ML-powered platform revolutionizes digital advertisingmanagement by offering marketers a truly integrated solution for omni-channel orchestration.It seamlessly consolidates the key functi
77、ons of planning,creation,measurement,monitoring,management,and optimization of advertisements across the worlds leading ad channels,into a singular unified platform.This eliminates the need for marketers to grapple with multiple siloed platforms,creating XPO as an all-encompassing system of record t
78、hat closes thecustomer marketing analytics loop.Marketers use XPO to gain access to real-time actionable insights and effectively execute cross-channel and in-channel optimization to drive advertisingperformance.XPO harnesses the power of AI/ML to ingest vast amounts of real-time data,providing a da
79、ta-driven solution.XPO integrates data collection,processing,analysis,and advertising delivery to optimize advertising performance through continuous decision-making on budget allocation and advertisingplacements across various ad channels,platforms,and devices.This systematic data-driven approach e
80、nables marketers to effectively target their desiredaudience at scale across the Internet and native platforms.To help marketers maximize their use of XPO,we provide add-on services including managed activations where we support marketers in launching andmonitoring advertising campaigns using XPO.Ou
81、r professional services further extend our support into technical and business consultation,staff trainingand technical support,to assist their immediate business challenges.For customers preferring campaign-driven engagements without any long-term platformcommitment,we offer managed activations to
82、fully manage end-to-end of their advertising campaigns.Since our inception in September 2009 in Singapore,we have expanded our operation to the U.S.,Vietnam,India,and Malaysia,where the U.S.is nowby far our largest market.Over the years,we have consistently made substantial investments in research a
83、nd development,forging robust partnerships withleading media,data,and technology partners across the United States,Europe,and Asia.These efforts have been pivotal in shaping our commercialdevelopment and product roadmap as we actively pursue expansion initiatives.Our commitment to excellence has bee
84、n recognized by our industry partners,including recently being enlisted as a Meta Business Partner and GooglePremier Partner(among the top 3%exclusive tier)in recognition of our technical,operation,and business excellence.We were awarded the MarTechBreakthrough Awards for“Best Remarketing Platform”i
85、n 2022 and named a Top 10 Marketing Automation Solution Provider in 2021 by MarTech Outlook.To date,our customers primarily comprising marketers from the advertising agencies,have been utilizing XPO to successfully automate and optimizeoutcomes for over 6,777 advertiser accounts and growing.Spanning
86、 diverse industry verticals such as automotive,healthcare,e-commerce,business-to-business,retail,consumer packaged goods,travel and hospitality,our platform has demonstrated its versatility,scalability,and effectiveness in meeting thedynamic demands of various businesses.Our goal is to further expan
87、d our business,fostering wider adoption of XPO and extending its benefits to a broaderarray of customers.Our revenue increased by 38.1%from US$6.3 million for the year ended December 31,2022 to US$8.7 million for the year ended December 31,2023,primarily due to increased adoption of our platform giv
88、en the strong demand from our customers to pursue automation and scaling efficiency.Our grossprofit increased by 78.5%from US$1.8 million for the year ended December 31,2022 to US$3.2 million for the year ended December 31,2023.Our net lossincreased by 18.9%from US$7.0 million for the year ended Dec
89、ember 31,2022 to US$8.0 million for the year ended December 31,2022,primarily due toincreases in platform operations expenses relating to scaling of our XPO platform and general and administration expenses.Our Competitive Strengths We attribute our growing success to the following competitive streng
90、ths,and we believe that they will continue to provide us with a wide variety oflong-term competitive advantages:Our highly differentiated XPO platform is an all-encompassing omni-channel programmatic advertising management and execution(AMX)platform that is unparallel in terms of depth(being feature
91、-rich and deep integration with the Native Platforms and data partners)and breadthcovering the ad channels across the Open Internet and Native Platforms,thus providing marketers with the sophistication and comprehensiveness toefficiently and effectively target desired global audience in real-time.Ou
92、r strong technology capabilities,our deep expertise and domain knowledge in the fields of advertising technologies(or“adtech”),naturallanguage processing,AI/ML and data science,and our relentless focus on innovation over a decade enable us to consistently deliver differentiatedproducts and solutions
93、.We have established a long track record in delivering quality customer experience and service to our customers,and our continued strong emphasison customer centricity,allow us to retain and grow with our customers.5Table of Contents We have built our customer base and partnerships by being aligned
94、with our customers needs and independent,competitive and transparent in ouroffering.We have a caring,committed,and experienced management team that has worked together for over a decade with proven track record of deliveringresults.Our Growth Strategies Our objective is to accelerate the growth of o
95、ur business and further our technological leadership in the nascent AMX solutions market by leveraging onour proprietary technologies to expand into more markets and applications as customers seek out integrated cross-channel cloud platform.We intend toachieve this goal by pursuing the following str
96、ategies:Expand customer base and deepen market penetration;Broaden adoption through innovation;Expand through strategic partnerships and acquisitions;and Explore new markets and increase global presence.Summary of Risk Factors An investment in our securities involves a high degree of risk.You should
97、 carefully consider the risks summarized below.These risks are discussedmore fully in the“Risk Factors”section on page 13 of this prospectus.These risks include,but are not limited to,the following:Risks Relating to Our Business and Industry We are dependent on key management personnel for our futur
98、e success and growth.The loss of services of any of our key management personnel orskilled employees without suitable and timely replacement may materially and adversely affect our business,financial condition,and results ofoperations.The digital advertising industry is highly competitive,and if we
99、do not effectively compete against our current and future competitors,or if we failto improve and enhance our service offerings and solutions to meet our customers evolving needs,or technological developments or industrychanges,our business,financial condition and results of operations could be harm
100、ed.Our success depends on acquiring new customers,effectively retaining our existing customers on how to fully utilize our platform and increasingtheir usage on our platform.We are highly dependent on having continuous connectivity and access to advertising inventory,data,and certain technology serv
101、ices to provide ourplatform and services to customers.Any disruption,curtailment or termination to these resources can adversely impact our revenue and growth.Operational and performance issues with our platform may adversely affect our business,financial condition,and results of operations.Continue
102、d operation of our business depends on the performance and reliability of the internet,mobile networks,cloud providers and otherinfrastructure that is not under our control.We often have relatively long sales cycles,resulting in considerable lead time between initial contact,execution of sales agree
103、ment and subsequentrevenue commitment,making it challenging to ultimately project when we will generate revenue from the customers,if at all.Our contracts with marketers are not exclusive,may be terminated upon relatively short notice,and generally do not require long-termcommitments.If the marketer
104、s representing a significant portion of our revenue decide to materially reduce their use of our platform,we couldexperience an immediate and significant decline in our revenue and profitability which could harm our business,operating results,and financialoperations.Our historical growth may not be
105、indicative of our future growth,and we may fail to properly manage future growth.We may not be successful in implementing important new strategic initiatives,which may have an adverse impact on our business and financialresults.We may fail to effectively maintain,promote and enhance our brand.Our bu
106、siness expansion may not be successful.Future strategic alliances or acquisitions may expose us to a variety of risks,which may have a material and adverse effect on our business,financialcondition and results of operations.Inadvertent disclosure or improper use or breach of confidential and/or pers
107、onal information we hold,or of the security of our or our customers,orother partners computer systems,could subject us to significant reputational,financial,legal and operational consequences.We face risks associated with security breaches as well as privacy and data protection regulations.We are su
108、bject to stringent,changing and continuous regulations,audits and governance related to data privacy,data protection and anti-fraud.Ourfailure to comply with such obligations or to renew our certifications could lead to termination of access,regulatory investigations or actions,litigation,fines and
109、penalties,disruptions to our business operations,reputational damage,loss of customers and revenue,increased cost,reductionin availability of data,reduce our ability to utilize or disclose data,adversely affect the demand for our products and services,or other adversebusiness consequences.Failure to
110、 detect advertising fraud could harm our reputation and hurt our ability to execute our business plan.Our platform might be used for illegal or improper purposes,which could expose us to additional liability and harm our business.If the non-proprietary technology,software,products and services that
111、we use are unavailable,or have future terms we cannot agree to,or do notperform as we expect,our business,financial condition and results of operations could be harmed.We may not be able to protect our intellectual property rights.Our technology,software and systems are highly complex and may contai
112、n undetected errors or vulnerabilities.Errors or inaccuracies in our business data and algorithms may adversely affect our business decisions and the customer experience.Unfavorable publicity and negative public perception about the advertising industry,particularly concerns regarding data privacy a
113、nd securityrelating to the advertising industrys technology and practices,and perceived failure to comply with laws and industry self-regulation,couldadversely affect our business,operating results,and financial condition.6Table of Contents We are subject to risks related to litigation,including int
114、ellectual property infringement claims,consumer protection actions and regulatory disputes.We may not have sufficient insurance to protect ourselves against substantial losses.We have identified three material weaknesses in our internal control over financial reporting as of December 31,2023.If we f
115、ail to implement andmaintain an effective system of internal control over financial reporting,we may be unable to accurately report our results of operations,meet ourreporting obligations or prevent fraud,and investor confidence and the market price of our shares may be materially and adversely affe
116、cted.Our revenue and results of operations are highly dependent on the overall demand for advertising.Pandemics and epidemics,natural disasters,terrorist activities,political unrest and other factors that affect the amount of advertising spending can make it difficult for us to predict our revenue,a
117、nd could materially and adversely affect our business,financial condition,results of operations and prospects;Seasonal fluctuations in advertising activity could have a negative impact on our business,financial condition and results of operations.Economic downturns and market conditions beyond our c
118、ontrol could adversely affect our business,financial condition and results of operations.The estimates of market opportunity and forecasts of market growth included in this prospectus may prove to be inaccurate,and even if the marketsin which we compete achieve the forecasted growth,our business may
119、 not grow at similar rates,or at all.Risks Relating to Doing Business in the Jurisdictions Where We Operate We are exposed to risks arising from fluctuations of foreign currency exchange rates.Changes in taxation rates,audit regulations,investigations and tax proceedings could have a material advers
120、e effect on our financial condition andresults of operations.We face exposure to various risks including acts of war,terrorist attacks,epidemics,political instability,natural disasters,adverse weatherconditions and unforeseeable events.We face susceptibility to events such as terrorist attacks,acts
121、of violence and natural calamities.Risks Relating to Our Class A Ordinary Shares and This Offering You may face difficulties in protecting your interests,and your ability to protect your rights through U.S.courts may be limited,because we areincorporated in the Cayman Islands.As a company incorporat
122、ed in the Cayman Islands,we are permitted to adopt certain home country practices in relation to corporate governancematters that differ significantly from the NYSE American listing standards;these practices may afford less protection to shareholders than theywould enjoy if we complied fully with th
123、e NYSE American listing standards.We are a foreign private issuer within the meaning of the rules under the Exchange Act,and as such we are exempt from certain provisionsapplicable to U.S.domestic public companies.We may lose our foreign private issuer status in the future,which could result in sign
124、ificant additional costs and expenses.7Table of Contents We are an“emerging growth company,”and the reduced disclosure requirements applicable to emerging growth companies may make our Class AOrdinary Shares less attractive to investors.The market price of our shares may be volatile,which could resu
125、lt in substantial losses to investors.Corporate History and Structure The chart below illustrates our corporate structure as of the date of this prospectus.For a more detailed description of our history,see“Corporate History and Structure”in this prospectus.Holding Company Structure The Company is a
126、n exempted company incorporated in the Cayman Islands with no material operations of its own.We conduct our operations primarilyin the U.S.,Singapore,Vietnam,India,and Malaysia through our operating subsidiaries.The Class A Ordinary Shares offered in this offering are shares ofthe Cayman Islands hol
127、ding company,instead of shares of our operating subsidiaries.Investors in our Class A Ordinary Shares should be aware that theymay never directly hold equity interests in our operating subsidiaries.As a result of our corporate structure,our ability to pay dividends to our shareholders depends upon d
128、ividends paid by our operating subsidiaries.If ourexisting operating subsidiaries or any newly formed ones incur debt on their own behalf in the future,the instruments governing their debt may restrict theirability to pay dividends to us.Corporate Information We were incorporated in the Cayman Islan
129、ds on May 9,2023.The principal executive office of our operating subsidiaries is located at 21 MerchantRoad,#04-01 Singapore 058267.Our telephone number at this address is+65 6956 7483.Investors should submit any inquiries to the address and telephonenumber of our principal executive office.Our regi
130、stered office in the Cayman Islands is located at Harneys Fiduciary(Cayman)Limited,4th Floor,HarbourPlace,103 South Church Street,P.O.Box 10240,Grand Cayman KY1-1002,Cayman Islands.Our agent for service of process in the U.S.is Cogency GlobalInc.located at 122 East 42nd Street,18th Floor New York,NY
131、 10168.Our principal website is https:/.The information contained on our website is not a part of this prospectus.Implications of Being an Emerging Growth Company As a company with less than US$1.235 billion in revenue for our last fiscal year,we qualify as an“emerging growth company”pursuant to the
132、 JumpstartOur Business Startups Act of 2012,as amended,or the JOBS Act.An emerging growth company may take advantage of specified reduced reporting andother requirements compared to those that are otherwise applicable generally to public companies.These provisions include exemption from the auditora
133、ttestation requirement under Section 404 of the Sarbanes-Oxley Act of 2002,or Section 404,in the assessment of the emerging growth companys internalcontrol over financial reporting.The JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financialacc
134、ounting standards until such date that a private company is otherwise required to comply with such new or revised accounting standards.We have electedto take advantage of the benefits of this extended transition period provided under the JOBS Act for complying with new or revised accounting standard
135、s.Asa result,our operating results and financial statements may not be comparable to the operating results and financial statements of other companies who haveadopted the new or revised accounting standards.8Table of Contents We will remain an emerging growth company until the earliest of(i)the last
136、 day of the fiscal year during which we have total annual gross revenue of atleast US$1.235 billion;(ii)the last day of our fiscal year following the fifth anniversary of the completion of this offering;(iii)the date on which we have,during the preceding three-year period,issued more than US$1.0 bil
137、lion in non-convertible debt;or(iv)the date on which we are deemed to be a“largeaccelerated filer”under the Securities Exchange Act of 1934,as amended,or the Exchange Act,which would occur if the market value of the Class AOrdinary Shares that are held by non-affiliates exceeds US$700 million as of
138、the last business day of our most recently completed second fiscal quarter.Oncewe cease to be an emerging growth company,we will not be entitled to the exemptions provided in the JOBS Act discussed above.We are an“emerginggrowth company”as the term is used in the JOBS Act and,as such,we are subject
139、to certain reduced public company reporting requirements.See theapplicable disclosure under the section captioned“Risk Factors Risks Relating to Our Class A Ordinary Shares and This Offering.”Implications of Being a Foreign Private Issuer We are a foreign private issuer within the meaning of the rul
140、es under the Exchange Act,and as such we are exempt from certain provisions of thesecurities rules and regulations in the U.S.that are applicable to U.S.domestic issuers.Moreover,the information we are required to file with or furnish tothe U.S.Securities and Exchange Commission,or the SEC,will be l
141、ess extensive and less timely compared to that required to be filed with the SEC by U.S.domestic issuers.In addition,as a company incorporated in the Cayman Islands,we are permitted to adopt certain home country practices in relation tocorporate governance matters that differ significantly from the
142、NYSE American corporate governance listing standards.These practices may afford lessprotection to shareholders than they would enjoy if we complied fully with the NYSE corporate governance listing standards.Currently,we plan to rely onhome country practices with respect to our corporate governance a
143、fter we complete this offering.Market and Industry Data This prospectus contains market data,industry data,estimates and forecasts concerning our industry that were obtained from third-party sourcesincluding market research databases,publicly available information,and industry publications and repor
144、ts,including internal surveys and industry forecasts.We have relied on certain data from such sources we believe to be reliable based on our managements knowledge of the industry,but the accuracy andcompleteness of such information is not guaranteed.We have not sought the consent of the sources to r
145、efer to such publicly available information in thisprospectus,and we have not independently verified the accuracy or completeness of the data.In addition,we do not necessarily know what assumptions andlimitations regarding general economic growth were used or were applicable in preparing the third-p
146、arty forecasts we cite,and you are cautioned not to placeundue reliance on these estimates.The industry in which we operate is subject to a high degree of uncertainty and risk due to a variety of factors,includingthose described in the“Risk Factors”section.These and other factors could cause results
147、 to differ materially from those expressed in these publications andreports.9Table of Contents THE OFFERING Offering priceWe currently estimate that the initial public offering price will be betweenUS$4.00 and US$5.50 per share Class A Ordinary Shares offered by us3,000,000 Class A Ordinary Shares(o
148、r 3,450,000 Class A Ordinary Shares ifthe underwriters exercise the option to purchase additional Class A OrdinaryShares in full)Class A Ordinary Shares offered by the Resale Shareholders787,250 Class A Ordinary Shares Class A Ordinary Shares outstanding immediately before this offering22,477,825 Cl
149、ass A Ordinary Shares Ordinary shares outstanding immediately after this offering30,258,400 ordinary shares,comprised of 25,477,825 Class A Ordinary Sharesand 4,780,575 Class B Ordinary Shares(or 30,708,400 ordinary shares,comprised of 25,927,825 Class A Ordinary Shares and 4,780,575 Class BOrdinary
150、 Shares if the underwriters exercise the option to purchase additionalClass A Ordinary Shares in full)Over-allotment option to purchase additional Class A Ordinary SharesWe have granted the Representative an option to purchase up to 450,000additional Class A Ordinary Shares,representing 15%of the Cl
151、ass A OrdinaryShares sold in the offering,at the initial public offering price within 45 days ofthe date of this prospectus,less underwriting discounts and commissions,solely for the purpose of covering over-allotments.Use of proceedsWe intend to use our net proceeds from this offering as follows:ap
152、proximately 35%is expected to be used for recruitment of sales stafffor market expansion primarily in the U.S.;approximately 15%is expected to be used for marketing and brandbuilding activities;approximately 15%,is expected to be used for improvement andenhancement of our products;and the balance of
153、 the net proceeds for other working capital and generalcorporate purposes.We will not receive any of the proceeds from the sale of Class A ordinaryshares by the Resale Shareholders.Lock-upWe,our directors,officers and the majority of existing holders of ouroutstanding ordinary shares immediately pri
154、or to this offering have agreedwith the underwriters not to offer,issue,sell,encumber,grant any option forthe sale of or otherwise dispose of any of the securities for a period of twelvemonths after the completion of this offering without the written consent of theRepresentative.See“Shares Eligible
155、for Future Sale”and“Underwriting.”ListingWe intend to apply for the listing of the Class A Ordinary Shares on the NYSEAmerican Market under the symbol KNRX.The Class A Ordinary Shares willnot be listed on any other stock exchange or traded on any automatedquotation system.Risk FactorsSee“Risk Factor
156、s”and other information included in this prospectus for adiscussion of the risks you should carefully consider before deciding to investin the Class A Ordinary Shares.Transfer AgentSecurities Transfer Corporation Payment and settlementThe underwriters expect to deliver the Class A Ordinary Shares ag
157、ainstpayment on or about,2025.10Table of Contents SUMMARY CONSOLIDATED FINANCIAL AND OPERATING DATA The following summary consolidated statements of operations and comprehensive loss data and cash flows data for the years ended December 31,2023and 2022 and summary consolidated balance sheets data as
158、 of December 31,2023 and 2022 have been derived from our audited consolidated financialstatements included elsewhere in this prospectus.Our audited consolidated financial statements are prepared and presented in accordance with the U.S.generally accepted accounting principles,or U.S.GAAP.Our histori
159、cal results are not necessarily indicative of results to be expected for any future period.The following summary consolidated financial datafor the periods and as of the dates indicated are qualified by reference to,and should be read in conjunction with,our consolidated financial statements andthe
160、related notes and“Managements Discussion and Analysis of Financial Condition and Results of Operations”included elsewhere in this prospectus.Summary Consolidated Statements of Operations and Comprehensive Loss For the Six Months EndedJune 30,For the Year EndedDecember 31,2024 2023 2023 2022 US$US$US
161、$US$Revenue 5,497,418 3,895,827 8,725,816 6,316,380 Cost of revenue (3,268,901)(2,666,495)(5,496,119)(4,506,573)Gross profit 2,228,517 1,229,332 3,229,697 1,809,807 Total operating expenses (5,037,431)(5,391,946)(11,187,992)(8,245,243)Loss from operations (2,808,914)(4,162,614)(7,958,295)(6,435,436)
162、Other(expense)income,net (110,832)366,802 26,762 (219,503)Loss before income tax expenses (2,919,746)(3,795,812)(7,931,533)(6,654,939)Provision for income tax (16,248)(2,954)(32,239)(43,928)Net loss (2,935,994)(3,798,766)(7,964,772)(6,698,867)Less:net(income)loss attributable to noncontrolling inter
163、est (540)4,562 3,248 (790)Net loss attributable to Knorex (2,936,534)(3,794,204)(7,961,524)(6,699,657)Loss per share basic and diluted (0.11)(0.16)(0.33)(0.31)Summary Consolidated Balance Sheets As of June 30,As of December 31,2024 2023 2022 US$US$US$Cash and cash equivalents 706,015 1,862,781 511,7
164、19 Total current assets 3,175,482 4,007,981 2,988,105 Total non-current assets 1,917,549 1,700,618 1,028,785 Total assets 5,093,031 5,708,599 4,016,890 Total current liabilities 5,816,191 4,971,314 11,378,227 Total non-current liabilities 516,281 585,596 1,045,731 Total liabilities 6,332,472 5,556,9
165、10 12,423,958 Total shareholders(deficit)equity (1,239,441)151,689 (8,407,068)Total liabilities and shareholders(deficit)equity 5,093,031 5,708,599 4,016,890 11Table of Contents Summary Consolidated Statements of Cash Flows For the Six Months EndedJune 30,For the Year EndedDecember 31,2024 2023 2023
166、 2022 US$US$US$US$Net cash used in operating activities (3,439,549)(2,784,709)(5,508,254)(6,853,948)Net cash used in investing activities (445,057)(443,385)(878,219)(708,599)Net cash provided by financing activities 2,798,422 3,424,924 7,848,654 7,413,323 Effect of exchange rate changes (70,582)(239
167、,704)(111,119)18,977 Net change in cash and cash equivalents (1,156,766)(42,874)1,351,062 (130,247)Cash and cash equivalents,at the beginning of year/period 1,862,781 511,719 511,719 641,966 Cash and cash equivalents,at the end of year/period 706,015 468,845 1,862,781 511,719 12Table of Contents RIS
168、K FACTORS An investment in our Class A Ordinary Shares involves a high degree of risk.Before deciding whether to invest in our Class A Ordinary Shares,youshould consider carefully the risks described below,together with all the other information set forth in this prospectus,including the section tit
169、led“Managements Discussion and Analysis of Financial Condition and Results of Operations”and our consolidated financial statements and related notes.Ifany of these risks actually occurs,our business,financial condition,results of operations or cash flow could be materially and adversely affected,whi
170、chcould cause the trading price of our Class A Ordinary Shares to decline,resulting in a loss of all or part of your investment.The risks described below andelsewhere in the prospectus as referenced above are not the only ones that we face.Additional risks not presently known to us or that we curren
171、tly deemimmaterial may also affect our business.You should only consider investing in our Class A Ordinary Shares if you can bear the risk of loss of your entireinvestment.Risks Relating to Our Business and Industry We are dependent on key management personnel for our future success and growth.The l
172、oss of services of any of our key management personnel orskilled employees without suitable and timely replacement may materially and adversely affect our business,financial condition,and results ofoperations.Our Company is led by a strong management team with extensive experience in the technology
173、and digital marketing sectors.Our success and growth asa Company significantly depend on the leadership,knowledge,skills and continued services of our key management team and other key personnel.We alsorely on skilled employees in our product development,support,and sales teams to attract and keep k
174、ey clients.The loss of any of these persons couldadversely affect our business.Our future success also depends on our ability to retain,attract,and motivate highly skilled technical,managerial,marketing and customer servicepersonnel.We may incur significant costs to attract and retain qualified empl
175、oyees,including significant expenditures related to salaries and benefits andcompensation expenses related to equity awards.New employees often require training and,in many cases,take significant time before they achieve fullproductivity.We may lose new or existing employees to our competitors or ot
176、her companies before we realize the benefit of our investment in recruiting ortraining them.Competition for personnel is intense,particularly in the technology and software industries.Employee turnover,including changes in ourmanagement team,and our inability to attract and retain qualified personne
177、l could adversely affect our business,financial condition,and results ofoperations.To maintain and grow our business,we will need to identify,hire,develop,motivate,and retain highly skilled employees.Identifying,recruiting,training,integrating,and retaining qualified individuals requires significant
178、 time,expense,and attention.In addition,from time to time,there may bechanges in our management team that may be disruptive to our business.We may also be subject to local hiring restrictions in certain markets,particularly inconnection with the hiring of foreign employees,which may affect the flexi
179、bility of our management team.If our management team,including any new hiresthat we make,fail to effectively work together,and execute our plans and strategies,or if we are not able to effectively recruit and retain employees,ourability to achieve our strategic objectives will be adversely affected
180、and our business and growth prospects will be harmed.Competition for highly skilled personnel,particularly software engineers and technology professionals,is intense,especially in the U.S.,Singapore,Vietnam,India,and Malaysia where our business operations and research and development centers are loc
181、ated.We may need to invest significant amounts ofcash and equity to attract and retain new employees and we may not be able to realize returns on these investments.The digital advertising industry is highly competitive,and if we do not effectively compete against our current and future competitors,o
182、r if we fail toimprove and enhance our service offerings and solutions to meet our customers evolving needs,or technological developments or industry changes,ourbusiness,financial condition,and results of operations could be harmed.We operate in a competitive and rapidly changing industry that is su
183、bject to changing technology,regulations and customer demands with manycompanies providing competing solutions.With the introduction of new and evolving technologies and the influx of new entrants into the market,we expectcompetition to persist.This could potentially impact our ability to generate h
184、igher revenue and sustain profitability.Furthermore,as market participantsstrive to introduce new products and services to capture advertisement spending,the emergence of new advertising technologies and purchasing methodsposes a dynamic competitive challenge.Our ability to design and deploy service
185、s and solutions that anticipate and adapt to rapid and continual changes intechnology and industry advances and offerings to meet the increasing needs of our clients is critical to our success.If we fail to understand and anticipatecustomer needs,our new products and services may fail,and our revenu
186、es and earnings may suffer.Our growth plan is centered on responding to these typesof advancements by fostering innovation that will allow us to expand our business into new areas of growth.We have made and will continue to make significant investments in research,development and marketing for exist
187、ing services and technologies as wellas new technology or new applications of existing technology.Investments in new technology and new services contain certain amount of risk.Platformdevelopment,new products and services development,or infrastructure modifications,may necessitate significant capita
188、l expenditures.We cannot guaranteethat we will be able to secure funding to cover such costs.The process of creating,developing,acquiring new technology products and services,as well asimproving existing ones,is time-consuming,costly,and uncertain.Any delay in the development,acquisition,marketing,o
189、r launch of a new offering orenhancement to an existing offering could cause customer attrition or limit our ability to attract new customers and might have material and negative impacton our business,financial position and operating performance.For several years,if at all,we may not see significant
190、 revenue from such new service orproduct,or new applications of current new service,or product.New services and products may not be successful,and even if they are,operating margins forcertain new products and businesses may be lower than those we have seen in the past.Our business faces competition
191、 from both private companies and from public companies.Some of our current and potential competitors may havesignificantly more financial,technical,marketing,and other resources than we have,allowing them to devote greater resources to the development,promotion,sale and support of their products and
192、 services.They may also have more extensive customer bases and broader supplier relationships than wehave.As a result,these competitors may have an advantage in quickly adapting to new technologies,developing deeper marketer relationships,or offeringservices at lower prices.Increased competition may
193、 lead to lower pricing for our XPO platform,increased sales and marketing expense,longer sales cycles,or a decrease of our market share,any of which could negatively affect our revenue and future operating results and our ability to grow our business.In addition,our competitors may also have greater
194、 brand recognition than we have and actively target our market and have the power to significantlychange the nature of the marketplace to their advantage.Some of our larger competitors may have a broader range of products and services and they canleverage such comprehensive offerings to gain a compe
195、titive edge,including by selling at a lower margin or bundling of product with services at a reducedprice.These larger competitors often have broader product lines and market focus,making them less vulnerable to market fluctuations.We may alsoexperience negative market perception for being a smaller
196、 company than our larger competitors.New technological entrants are and will continue to enter.We may face competition from companies that are currently unknown to us or do not yet exist.If these companies develop,market,or resell competitive high-value marketing products or services,acquire one of
197、our existing competitors or form astrategic partnership with one of our competitors,our ability to compete effectively could be significantly hindered and our results of operations could beharmed.Their new services or technology may make our offers less differentiated or competitive in comparison to
198、 other options,negatively impacting ouroperating results.Our products and services,our results of operations and our ability to develop and maintain a competitive advantage and continue to grow could beharmed if we do not adequately invest in new technology and industry developments or evolve and ex
199、pand our business at a sufficient speed and scale,or ifwe do not make the right strategic investments to respond to these developments and successfully drive innovation.Our success depends on acquiring new customers,effectively retaining our existing customers and increasing their usage of our platf
200、orm.Our success and revenue growth depend on constantly acquiring new customers and increasing our current customers usage of our XPO platform.Ourcontracts and relationships with customers generally do not include long-term or exclusive obligations requiring them to use our platform or maintain orin
201、crease their use of our platform.Our customers may have relationships with numerous providers and can use both our platform and those of ourcompetitors without incurring significant costs or disruption.Our customers may also choose to decrease their overall advertising spend for any reason.According
202、ly,we must continually strive to acquire new customers and retain existing ones,increase their usage of our platform,and capture a larger share oftheir advertising spend.However,we may not be successful at training customers,particularly our newer customers,on how to use our platform to get themost
203、benefit from our platform and increase their usage.If these efforts are unsuccessful or if our customers decide to halt or reduce their usage of ourplatform for any other reason,or if we fail to attract new customers,our revenue could fail to grow or decline,which would materially and adversely harm
204、our business,financial condition,and results of operations.In addition,we derive a substantial part of our total revenues from a limited number of customers.For the year ended December 31,2023,three customers accounted for approximately 40.1%,20.0%and 14.6%,respectively,of our total revenues.For the
205、 year ended December 31,2022,threecustomers accounted for approximately 17.4%,15.1%and 10.5%,respectively,of our total revenues.Except for these major customers set forth above,noother customers accounted for more than 10%of our sales during the respective periods.We cannot assure you that our custo
206、mers will continue to use and increase their spending on our platform or that we will be able to attract enough newcustomers to continue to grow our business and revenue.If any of our major customers or a substantial portion of our businesss customers decide tomaterially reduce or cease their use of
207、 our platform,it could have a material adverse effect on our business,financial condition,and results of operations.Furthermore,we may not be able to replace in a timely manner,or at all,customers who decrease or cease their usage of our platform with new customersthat will use our platform to the s
208、ame extent.13Table of Contents We are highly dependent on having continuous connectivity and access to advertising inventory,data,and certain technology services to provide ourplatform and services to customers.Any disruption,curtailment or termination to these resources can adversely impact our rev
209、enue and growth.We depend on various media,data,technology,software,products,and services from third parties or available as open source,including critical featuresand functionality of our platform,API technology,payment processing,payroll,and other professional services.For example,for location-bas
210、ed targeting,we use a combination of third-party data and geolocation services to serve advertisements relevant to their geographic area.Identifying,negotiating,complying with and integrating with third-party terms and technology are complex,costly and time-consuming matters.We must maintain consist
211、ent access to advertising inventory,data and certain technology services.Our success depends on our ability to secure access toquality inventory on reasonable terms across a broad range of advertising networks,media,and platforms,including video,display,CTV/OTT,audio andmobile inventory.The amount,q
212、uality,and cost of inventory available to us may change at any time.A few inventory suppliers hold a significant portion ofthe programmatic inventory either generally or concentrated in a particular channel,such as audio and social media.In addition,we compete with companieswith which we have busine
213、ss relationships.If our relationships with certain of our suppliers were to cease,or if the material terms of these relationships wereto change unfavorably,our business would be adversely impacted.Our relationships with suppliers of advertising inventory,data and certain technology services may not
214、involve long-term contracts,which means thereis no assurance of consistent access to high-quality inventory on favorable terms.This lack of guarantee poses a potential challenge to our ability to secureadvertising inventory,data and technology on real-time advertising exchanges and find alternative
215、sources with comparable consumer demographics andtraffic patterns in a timely manner.Additionally,despite our and our suppliers efforts to prevent fraud and conduct quality assurance checks,there is a risk ofencountering low-quality or misrepresented inventory through real-time advertising exchanges
216、.The failure of third-party providers to uphold the maintenance,support,and security of their technology,whether in a general context or pertaining toour accounts specifically,or experiencing downtime,errors,or defects in their products or services,has the potential to significantly and negatively a
217、ffect ourplatform,our administrative responsibilities,and various other aspects of our business.In such cases,the need to substitute these third-party providers ortheir technology,products,or services may lead to service interruptions and operational challenges that hinder our service delivery capab
218、ilities,or at times itmay not be possible to replace them with another third-party provider.In the event these third-party providers experience any interruption in operations orcease business for any reason,or if we are unable to agree on satisfactory terms for ongoing partnerships,we would be compe
219、lled to engage with alternativeservice providers or take on certain hosting responsibilities internally.Furthermore,even a brief disruption has the potential to adversely affect marketplaceactivities and could therefore result in a loss of revenue.If we encounter challenges in establishing or sustai
220、ning our relationships with these third-partyproviders or are required to seek replacements,it may necessitate diverting internal resources and could have repercussions on our business,financialstanding,and operational performance.Inventory suppliers control the bidding process,rules,and procedures
221、for the inventory they supply,and their processes may not always work in ourfavor.For example,suppliers may place restrictions on the use of their inventory,including prohibiting the placement of advertisements on behalf of specificadvertisers.Through the bidding process,we may not win the right to
222、deliver advertising to the inventory that is selected through our products and may notbe able to replace inventory that is no longer made available to us.Our success depends on consistently adding valuable inventory in a cost-effective manner.If we are unable to maintain a consistent supply of quali
223、tyinventory for any reason,client retention and loyalty,and our financial condition and operating results could be harmed.Also,as new types of inventoriesbecome available,we may need to expend significant resources to ensure we have access to such new inventory.14Table of Contents Operational and pe
224、rformance issues with our platform may adversely affect our business,financial condition,and results of operations.We depend upon the sustained and uninterrupted performance of our XPO platform to collect,process and interpret data,deliver digital marketingservices across different channels,optimize
225、 campaign performance in real time,and provide billing information to our financial systems.We may from time-to-time face operational and performance issues,whether real or perceived,including a failure to respond to technological changes or to upgrade ourtechnology systems.If our platform cannot sc
226、ale to meet demand,if there are errors in our execution of any of these functions on our platform,or if weexperience outages,our business may be harmed.Our XPO platform is complex and multifaceted.Operational and performance issues could arise from the platform itself or from external factors,such a
227、sdisruption in connectivity,no or limited access to providers,cyberattacks or other third-party attacks.Real or perceived errors,malfunctions,failures,vulnerabilities,or bugs have been found in the past,and may be found in the future.It is also often used in connection with computing environments ut
228、ilizingdifferent operating systems,system management software,equipment,and networking configurations,which may cause errors in,or failures of,our platformor such other computing environments.Our services are delivered via multi-cloud providers;all of which may experience errors or failures in the o
229、peratingenvironment where they are deployed.For example,we are dependent on third-party cloud providers to provide the XPO platform to our customers as asoftware-as-a-service(SaaS)and we rely on them to ensure service and data availability,security,and scalability,which are integral to the XPO platf
230、ormsperformance and continuity of our services.Operational and performance issues with our platform could include the failure of our UI,outages,errors duringupgrades or patches,unanticipated volume overwhelming our databases,server failure or catastrophic events affecting one or more server faciliti
231、es.Somefailures may shut our platform down completely or partially.We provide service level agreements to our customers,and if our platform is not available forspecified amounts of time or if there are failures in the interaction between our platform,partner system and third-party technologies,we ma
232、y be required toprovide credits or other financial compensation to our customers.Despite our testing,real or imagined mistakes,failures,or problems in our customer solutions,software or technology,or third-party technology orsoftware,including open-source software,may not be discovered until our cus
233、tomers utilize our services.As our business grows,we expect to further invest in technology services and equipment.Failure to implement these enhancements may result inunanticipated system disruptions,slow transaction processing,unreliable service levels,impaired quality,or delays in reporting accur
234、ate informationregarding transactions in our platform,any of which could negatively affect our reputation and ability to attract and retain customers.In addition,theexpansion and improvement of our systems and infrastructure may require us to commit substantial financial,operational,and technical re
235、sources,with noassurance our business will grow.If we fail to respond to technological change or to adequately maintain,expand,upgrade and develop our systems andinfrastructure in a timely manner,our growth prospects and results of operations could be adversely affected.Operational and performance i
236、ssues with our platform may also lead to negative publicity,damage to our brand and reputation,reluctance of the marketto accept our platform,increased costs or loss of revenue,unavailability of our platform,loss of competitive position or customer claims for losses incurred.Addressing such issues c
237、ould require significant expenditures of capital and other resources and could cause interruptions,delays,or the cessation of ourbusiness,any of which may adversely affect our financial condition and results of operations.Continued operation of our business depends on the performance and reliability
238、 of the internet,mobile networks and other infrastructure that is notunder our control.Our platform and business depend on the performance and reliability of the internet,mobile networks and other infrastructure that is not under ourcontrol.Disruptions in such infrastructure,including as the result
239、of power outages,telecommunications delay or failure,security breach,or computer virus,as well as failure by telecommunications network operators to provide us with the bandwidth we need to provide our products and offerings,could causedelays or interruptions to our services,offerings,and platforms.
240、Any of these events could damage our reputation,resulting in fewer users actively using ourplatform,disrupt our operations,and subject us to liability,which could adversely affect our business,financial condition,and results of operations.We often have relatively long sales cycles,resulting in consi
241、derable lead time between initial contact,execution of sales agreement and subsequentrevenue commitment,making it challenging to ultimately project when we will generate revenue from the customers,if at all.Our sales cycles,from initial contact to execution of sales agreement and implementation,ofte
242、n involves long cycles,which means there is a significantamount of time between initial contact,finalizing the sales agreement,and generating revenue from the agreement.Our sales efforts involve educating ourcustomers about the use,technical capabilities,and benefits of our XPO platform.Some of our
243、customers undertake an evaluation process that involvesreviewing the offerings of our competitors in addition to our platform.As a result,it is difficult to predict when we will begin onboarding new customers andgenerating revenue from these new customers.Even if our sales efforts successfully secur
244、e a new customer,we can only start generating the bulk of ourrevenue when our customers are onboarded and starting to advertise on our XPO platform under our usage-based pricing model;the client retains controlover when and to what extent it uses the XPO platform.As a result,this introduces a level
245、of unpredictability in our ability to add new customers andpromptly generate revenue,which has the potential to adversely impact or restrict the predictability of our growth.Further,we have encountered and maycontinue to face disputes with marketers regarding billing matters related to our services,
246、the operation of XPO,and the terms of our agreements.In caseswhere we are unable to recover payments or make necessary adjustments to customer bills,we may incur write-offs for bad debt or revenue reductions.These events could significantly impact our operating results during the periods in which su
247、ch write-offs or revenue adjustments occur.Moreover,there is apossibility that bad debt may exceed reserves set aside for such contingencies,resulting in an increase in our exposure to bad debt over time.Any escalationin write-offs for bad debt or reductions in revenue due to adjustments could have
248、a substantial negative effect on our business,financial condition,andoperating results.In addition,we are generally contractually required to pay suppliers of advertising inventory and data within a negotiated period,regardless of whetherour customers pay us on time,or at all.While we attempt to neg
249、otiate long payment periods with our suppliers and shorter periods from our customers,weare not always successful.As a result,our accounts payable with certain suppliers may be due in shorter cycles than our accounts receivables with certaincustomers,requiring us to remit payments from our own funds
250、.15Table of Contents Such payment process will increasingly consume working capital if we continue to be successful in growing our business.In addition,like manycompanies in the advertising technology industry,advertising agencies are often slow to remit payment to us,which may cause us to be unable
251、 to borrowagainst our accounts receivables on commercially acceptable terms,our working capital availability could be reduced,and consequently our operating resultsand financial condition would be adversely impacted.Additionally,we may need to rely on borrowings to partially fund our working capital
252、 requirements.We cannot assure you that our business will generate sufficient cash flow from operations or that future borrowings will be available to us in an amountsufficient to fund our working capital needs,if at all.If our cash flows and borrowings are insufficient to fund our working capital r
253、equirements,we may notbe able to grow at the rate we currently expect or at all.In addition,in the absence of sufficient cash flows from operations,we might be unable to meet ourobligations and we may therefore be at risk of default under any borrowing arrangements.We cannot assure you that it will
254、be able to access additionalfinancing or increase our borrowing or borrowing capacity on commercially reasonable terms or at all.Our sales cycle,from initial contact to contract execution and implementation,can take up to 120 days or longer.As part of our sales cycle,we mayincur significant expenses
255、 before we can generate any revenue from a prospective customer.We have no assurance that the substantial time and money spenton our sales efforts will generate significant revenue.If conditions in the marketplace,generally or with a specific prospective customer,change negatively,itis possible that
256、 we will be unable to recover any of these expenses.Our sales efforts involve educating our customers about the use,technical capabilities,and benefits of our products.As a result,it is difficult to predict when we will obtain new customers and begin generating revenue from these new customers.Even
257、if our sales efforts result in obtaining a new customer,the customer controls when and to what extent it uses our products and therefore the amount ofrevenue that we generate,and it may not sufficiently justify the expenses incurred to acquire the customer and the related training support.As a resul
258、t,wemay not be able to add customers,or generate revenue,as quickly as we may expect or need,which could harm our growth prospects,business,operatingresults,and financial condition.Our contracts with marketers are not exclusive,may be terminated upon relatively short notice,and generally do not requ
259、ire long-term commitments.Ifthe marketers representing a significant portion of our revenue decide to materially reduce their use of our platform,we could experience an immediateand significant decline in our revenue and profitability which could harm our business,operating results,and financial ope
260、rations.Marketers may do business with our competitors as well as with us and,in many instances may reduce or cancel their business with us or terminate ourcontracts without penalty and may bypass us and transact directly with each other or through other intermediaries that compete with us.According
261、ly,ourbusiness is highly vulnerable to changes in the macro environment,price competition,and development of new or more compelling offerings by ourcompetitors,which could reduce business generally or motivate publishers or advertisers to migrate to competitors offerings.Publishers and marketers may
262、 seek to change the terms on which they do business with us or allocate their advertising inventory or demand to ourcompetitors who provide advertising demand and supply to them on more favorable terms or whose offerings are considered more beneficial.Supply ofadvertising inventory is also limited f
263、or some publishers,such as special sites or new technologies,and publishers may request higher prices,fixed pricearrangements or guarantees that we cannot provide as effectively as our competitors,or that would reduce the profitability of that business.In addition,publishers sometimes place signific
264、ant restrictions on the sale of their advertising inventory,such as strict security requirements,limitations on data sharing,prohibitions on advertisements from specific advertisers or specific industries,and restrictions on the use of specified creative content or format.Finally,withthe proliferati
265、on of header bidding,which is the process by which multiple advertisers participate simultaneously in a digital auction to win advertising spaceon a website,publishers inventory is available for purchase through multiple exchanges simultaneously.Marketers,in turn,are free to direct their spend tous
266、or one or more of our competitors,and increasingly are seeking price concessions,or other consideration to direct more spend towards us.If a marketer or group of marketers representing a significant portion of the demand on our products,decides to materially reduce use of our solutions,itcould cause
267、 an immediate and significant decline in our revenue and profitability and harm to our business.It could be difficult for us to replace the lossesfrom any marketers whose relationships with us diminish or terminate in short time.Additionally,if we overestimate future usage,we may incur additionalexp
268、enses in adding infrastructure without a commensurate increase in revenue,which would harm our profitability and other operating results.Our historical growth may not be indicative of our future growth,and we may fail to properly manage future growth.Our business has experienced strong growth in rec
269、ent years.We generated revenue of US$8.7 million and US$6.3 million for the year ended December31,2023 and 2022,respectively,reflecting year-over-year growth of 38.1%.Despite the aforementioned rapid revenue growth,we may not be successful inexecuting our growth strategy,and even if we achieve our s
270、trategic plan,we may not be able to sustain profitability.In future periods,our revenue coulddecline or grow more slowly than we expect.We may also incur significant losses in the future for several reasons,including the materialization of thefollowing risks and the other risks described in this pro
271、spectus.Additionally,we may encounter unforeseen difficulties,complications,delays and otherunknown factors,such as:we may be unsuccessful in predicting and capturing industry trends and consumer preferences;we may be unable to introduce new services that appeal to customers;we may be unsuccessful i
272、n protecting or enhancing the recognition and reputation of our brands;we may be unsuccessful in competing for market share with our existing or new competitors;our ability to maintain existing relationships and to create new relationships with business partners;we may not be able to maintain and im
273、prove our customer experience;we may experience service interruptions,data corruption,cyber-based attacks or network security breaches which may result in the disruption of ouroperating systems or the loss of confidential information of our consumers;and we may be unable to retain key members of our
274、 senior management team or attract and retain other qualified personnel.Thus,there can be no assurance that we will be able to reach profitability on a quarterly or annual basis.We believe that our revenue and operatingresults will continue to fluctuate,and that period-to-period comparisons are not
275、necessarily indications of future performance.Our revenue and operatingresults may fail to meet the expectations of public market analysts or investors,which could have a material adverse effect on the price of our common stock.Our plans for implementing our business strategy and achieving profitabi
276、lity are based upon the experience,judgment and assumptions of our keymanagement personnel,and available information concerning the communications and technology industries.If managements assumptions prove to beincorrect,it could have a material adverse effect on our business,financial condition,and
277、 results of operations.We may not be successful in implementing important new strategic initiatives,which may have an adverse impact on our business and financial results.There is no assurance that we will be able to implement important strategic initiatives in accordance with our expectations,which
278、 may result in anadverse impact on our business and financial results.Our management may lack the required experience,knowledge,insight,or human and capital resources to carry out the effective implementation toexpand into new spaces outside of our current focuses.As such,we may not be able to reali
279、ze our expected growth,and our business and financial resultswill be adversely impacted.We may fail to effectively maintain,promote,and enhance our brand.We feel that protecting and enhancing our brand is critical to our Companys long-term success.It is critical to have a well-known brand to attract
280、clients,especially in this new and growing market.Our brand is promoted via our marketing team and word-of-mouth recommendations.The efficiency ofour marketing activities and the number of word-of-mouth referrals we receive from delighted clients will determine how well our brand is promoted.Wemay h
281、ave to spend more money to promote our brand.However,our brand promotion and marketing efforts may not result in greater sales,and even if they do,such additional revenues may not be enough tocover the costs of promoting our brand.Because we work in such a competitive field,our ability to sustain ou
282、r market position is directly influenced by ourbrand recognition.We may fail to attract enough new customers or retain our existing customers if we fail to successfully promote and maintain our brand,orif we incur additional expenses in an unsuccessful attempt to promote and maintain our brand,and o
283、ur business and results of operations may be materiallyand adversely affected.16Table of Contents Our business expansion may not be successful.Currently,we are pursuing multiple business strategies simultaneously,including expanding into more markets and business sectors,increasingpenetration in exi
284、sting markets with new solution offerings and accelerating the growth in the adoption of our XPO platform.We believe pursuing thesemultiple business strategies offers financial and operational synergies,but these diversified operations place increased demands on our limited resources.Furthermore,we
285、expect to experience growth in the number of our employees and the scope of our operations.To manage our anticipated future growth,wemust continue to implement and improve our managerial,operational,and financial systems,expand our facilities,and continue to recruit and train additionalqualified per
286、sonnel.Due to our limited financial resources and our management teams limited attention,we may not be able to effectively manage theexpansion of our operations or recruit and train additional qualified personnel.The expansion of our operations may lead to significant costs and may divertour managem
287、ent and business development resources.In addition,to meet our obligations as a public company and to support our anticipated long-termgrowth,we will need to increase our general and administrative capabilities.Our management,personnel and systems may not be adequate to support thisfuture growth.Any
288、 inability to manage our growth could delay the execution of our business plans or disrupt our operations.Future strategic alliances or acquisitions may expose us to a variety of risks,which may have a material and adverse effect on our business,financialcondition,and results of operations.From time
289、 to time,we may form strategic relationships with various third parties to promote our business goals,such as joint ventures,minority,ormajority equity investments.These agreements could expose us to a variety of risks,including risks associated with disclosing proprietary information,third-party no
290、n-performance,and higher costs involved with forming new strategic alliances,all of which could have a material and negative impact on ourbusiness.We may have limited ability to monitor or control these third parties actions.If any of these strategic partners receive negative publicity or sufferrepu
291、tational harm due to events related to their business,we may also face negative publicity or reputational harm due to our association with them.In addition,we may acquire other assets,goods,technologies,or businesses that are complementary to our existing business when appropriateopportunities occur
292、.Furthermore,prior and future acquisitions,as well as the subsequent integration of new assets and businesses,necessitate a considerableamount of attention from our management and may cause a diversion of resources away from our core business,which might negatively impact ouroperations.It is possibl
293、e that newly acquired assets or enterprises will not produce the expected financial outcomes.Acquisitions may necessitate the deployment of large sums of cash,potentially dilutive issuances of stock securities,hefty goodwill impairment charges,amortization expenses for other intangible assets and ex
294、posure to the acquired businesss potential unknown liabilities.Furthermore,the costs of locating andcompleting purchases may be substantial.Any negative developments could have a significant negative impact on our business,reputation,operating results,and financial position.Inadvertent disclosure,im
295、proper use,or breach of confidential and/or personal information we hold,or of the security of our or our customers,or otherpartners computer systems,could subject us to significant reputational,financial,legal and operational consequences.Our business involves the collection,storage,transmission,an
296、d utilization of data,including access to certain personal data,much of which must bemaintained on a confidential basis.These activities may in the future make us a target of cyber-attacks by third parties seeking unauthorized access to thedata we maintain and to which we provide access,including ou
297、r customer data,or to disrupt our ability to provide service through our platform.We take commercially reasonable measures to protect the security of information that we collect,use and disclose in the operation of our business,andto offer privacy protections with respect to such information,includi
298、ng subjecting ourselves to regular third-party audits of our privacy practices andreviewing our privacy policy,information security protection and practices through certifications.However,our efforts to protect our personal and/orconfidential information or our customers or partners personal or conf
299、idential information may be unsuccessful due to the actions of third parties,softwarebugs or other technical malfunctions,employee error or malfeasance,hacking,viruses,or other factors.In recent years,the frequency,severity and sophistication of cyber-attacks,computer malware,viruses,social engineer
300、ing,and other intentionalmisconduct by computer hackers has significantly increased,and government agencies and security experts across the world have warned about the growingrisks of hackers,cyber criminals and other potential attackers targeting information technology,or IT,systems.Such third part
301、ies could attempt to gain entryto our systems for the purpose of stealing data or disrupting the systems.In addition,our security measures may also be breached due to employee error,malfeasance,system errors or vulnerabilities.Third parties may also attempt to fraudulently induce employees or custom
302、ers into disclosing sensitiveinformation such as usernames,passwords,or other information to gain access to our customers data or our data,including intellectual property and otherconfidential business information.We currently store and process all the data through our XPO platform using third-party
303、 cloud providers.We store certain data in the XPO platform andthere are data that are also transmitted,shared and/or stored with suppliers/other parties for any data-related service.While we and our third-party cloudproviders have implemented security measures designed to protect against security br
304、eaches,these measures could fail or may be insufficient,particularly astechniques used to sabotage or obtain unauthorized access to systems change frequently and generally are not recognized until launched against a target,resulting in the unauthorized disclosure,modification,misuse,destruction,or l
305、oss of our or our customers data or other sensitive information.Any failure toprevent or mitigate security breaches and improper access to or disclosure of the data we maintain,including personal information,could result in litigation,indemnity obligations,regulatory enforcement actions,investigatio
306、ns,fines,penalties,mitigation and remediation costs,disputes,reputational harm,diversion of managements attention and other liabilities and damage to our business.Any unauthorized or improper disclosure of such personal and/orconfidential information violates our privacy policy,terms of service or o
307、ther policies,or the perception that an incident has occurred,whether it pertains toour company,customers,or partners,can cause us reputational harm and adversely impact our competitive position.The trust and confidence thatstakeholders,including clients,investors and the public,place in our ability
308、 to protect their information is of paramount importance.Any lapse insafeguarding this trust can lead to a loss of goodwill,customer attrition and diminished brand credibility.Hackers,bad actors and other unauthorized entrants use and plan a wide range of techniques that may not be detected until a
309、breach has occurred.As aresult,despite our best efforts,we may find it difficult or impossible to implement measures that fully prevent such attacks or respond in a timely manner.Unauthorized parties may attempt to gain access to our systems or facilities in the future through a variety of means,inc
310、luding hacking into our or ourclients systems or facilities,or fraudulently inducing our employees,clients,or others to disclose usernames,passwords,or other sensitive information,which may then be used to access our IT systems and gain access to our data or other confidential,proprietary,or proprie
311、tary information.Such efforts maybe state-sponsored and supported by significant financial and technological resources,making detection and prevention even more difficult.There can be noassurance that any security or other operational measures implemented by us or our third-party providers will be e
312、ffective against any of the aforementionedthreats or issues.The aftermath of a security or data breach can disrupt our regular operations.The need to investigate the breach,secure the affected systems,and rectifythe vulnerabilities can divert significant internal resources.These disruptions can affe
313、ct productivity,customer service and overall business continuity.17Table of Contents We have experienced cybersecurity incidents in the past and may experience further cybersecurity incidents or security breaches of its systems or IT(including third-party systems or IT that we rely on to operate its
314、 business)in the future,which may result in system disruptions,shutdowns,or unauthorizedaccess to or disclosure of confidential or personal information.We believe we have taken appropriate measures to protect our systems from intrusion,but we cannot be certain that advances in criminal capabilities,
315、discovery of new vulnerabilities in our systems and attempts to exploit those vulnerabilities,physical system or facility break-ins and data thefts or otherdevelopments will not compromise or breach the technology protecting our systems and the information we possess.We may incur significant costs i
316、n protecting against or remediating cyber-attacks.Any security breach could result in operational disruptions that impairour ability to meet our customers requirements,which could result in decreased revenue.Also,whether there is an actual or a perceived breach of oursecurity,our reputation could su
317、ffer irreparable harm,causing our current and prospective customers to reject our products and services in the future,deterring data suppliers from supplying us data or customers from uploading their data on our platform,or changing consumer behaviors and use of ourtechnology.Further,we could be for
318、ced to expend significant resources in response to a security breach,including those expended in notifying individualsand providing mitigating services,repairing system damage,increasing cyber security protection costs by deploying additional personnel and protectiontechnologies,and litigating and r
319、esolving legal claims or governmental inquiries and investigations,all of which could divert the attention of ourmanagement and key personnel away from our business operations.Our customers and other partners are primarily responsible for the security of their IT environments,and we rely heavily on
320、them and other third partiesto supply clean data content and/or to utilize our products and services in a secure manner.Each of these third parties may face risks relating to cybersecurity,which could disrupt their businesses and therefore materially impact ours.While we provide guidance and specifi
321、c requirements in some cases,wedo not directly control any of such parties cyber security operations,or the amount of investment they place in guarding against cyber security threats.Accordingly,we are subject to any flaws in or breaches of their systems,which could materially impact our business,fi
322、nancial condition and results ofoperations.We face risks associated with security breaches as well as privacy and data protection regulations.Our business involves the collection,storage,processing,and transmission of personal and sensitive data as discussed above.We are subject tonumerous laws and
323、regulations designed to protect such data,which may be updating from time to time.Laws and regulations that impact our business,andparticularly laws,regulations and other measures governments may take based on privacy and data protection concerns,are increasingly strict and complex,change frequently
324、 and at times are in conflict among the various jurisdictions where we do business.The industry self-regulatory bodies and governments,including the federal and state governments of the U.S.,continue to consider and implement lawsand regulations addressing data privacy,cybersecurity,and data protect
325、ion laws,which include provisions relating to breaches.For example,statutorydamages may be available to users through a private right of action for certain data breaches under the California Privacy Rights Act and potentially otherstates laws in the U.S.,the General Data Protection Regulation in the
326、 European Union and the European Economic Area,the Singapore Personal DataProtection Act 2012 in Singapore,the Digital Personal Data Protection Act in India,Vietnam Personal Data Protection Decree in Vietnam,and the PersonalData Protection Act 2010 in Malaysia,in relation to the collection,use and/o
327、r disclosure of personal data.In certain jurisdictions there are laws andregulations that restrict the flow of data outside the country which may also constrain our activities and require the use of local servers.In any event,asignificant security breach could materially harm our business,financial
328、condition,and results of operations.We may also be required to disclose personal data about an individual to a public agency,where the disclosure is necessary in the public interest,or forthe purposes of policy formulation or review.Some of these disclosures may put us in a disadvantaged position,es
329、pecially if the provided data is repurposedfor another intent,or adequate protection is not accorded to such data.As such laws increase in their complexity and impose new requirements,we may berequired to incur increased costs to comply with data privacy laws and could incur penalties for any non-co
330、mpliance or breaches.These laws may also limithow we are able to use data.Although we maintain and continue to improve internal access control mechanisms and other security measures to ensure secure and appropriate accessto and storage and use of our sensitive,business,personal,financial or confiden
331、tial information by anyone including our employees,customers,partners andother relevant third parties,our IT and infrastructure can be attacked by hackers,computer malware,viruses,social engineering(including phishing andransomware attacks),or breached due to software bugs,human error,employee theft
332、,misuse,misconduct,or malfeasance,system failure,or otherdisruptions.Any such breach could compromise our networks,and the data stored there could be accessed,held for ransom,publicly disclosed,misappropriated,lost,or stolen.Some of our systems will not be fully redundant,and any issues at our third
333、-party providers data centers may cause lengthy serviceinterruptions.Such a breach,misappropriation,or disruption could also disrupt our operations and the services we provide to customers,harm our reputation,andcause a loss of confidence in our tools and services,as well as necessitate significant expenditures to protect against future breaches and to correct problemscaused by these events.Any su