1. Investment Snapshot
2. Thesis
3. Valuation & Price Target
4. Business & Product Moat
5. People & Governance
6. Market & Macro
7. Financial Quality
8. Risk Register
9. Prediction Market
10. 𝕏 Posts
Discussion
1. Investment Snapshot
2. Thesis
3. Valuation & Price Target
4. Business & Product Moat
5. People & Governance
6. Market & Macro
7. Financial Quality
8. Risk Register
9. Prediction Market
10. 𝕏 Posts
Discussion
1. Investment Snapshot
2. Valuation
Discussion
Symbol
ELWS
Event Date
2023-07-25
Sector
Information Technology
Subsector
IT Services
Offer Range
$5.00
Shares Offered
1.2M
1.38M
$75.2M
87.0%
Implied Upside vs Midpoint
Description
We are a Japanese company operating our proprietary private blockchain technology, Grid Ledger System (“GLS”), to leverage blockchain technology in various applications in a range of industries. In Japan, there have been several incidents of information leakage from the databases of various companies, and there is a demand in Japan for stronger information security. In order to provide stronger information security, various companies in Japan are conducting tests of systems utilizing blockchain technology. Among those continuing tests, as of the date of this prospectus, very few systems have been completed and are fully operating. We believe that Japan is lagging behind the international progress of blockchain system development. One reason for the slow development progress is the extremely small number of engineers in Japan who can handle blockchain technology and the high cost of learning. There is an assumption in Japan that no blockchain technology in use can process a large number of transactions at high speed while guaranteeing security. Public blockchains generally have slow transaction processing speeds and poor real-time data processing capacity, and since there is no administrator on public blockchains, users are responsible for dealing with any problems that may arise in transactions. In order to address these challenges, we believe blockchain technology needs to be transformed to facilitate high-speed and real-time data processing, while ensuring security and usability. We believe our proprietary blockchain technology, GLS, can provide a solution to those challenges. GLS has the characteristics of traditional blockchains, such as tamper-resistance, security, and reliability; in addition, GLS also demonstrates high-speed processing capacity. Since our founding in May 2018, we have continued our research and development efforts. Such efforts have been led by our Chief Technology Officer, Hiroki Yamamoto, with advice from large Japanese companies such as NTT Docomo, Inc. and NEC Communication Systems, Ltd., and academia representatives such as Professor Shudo who is currently affiliated with Kyoto University, among others. We have verified the applicability of GLS in virtual space (Metaverse), financial domain and other domains. Currently, we are working with AMBITION DX HOLDINGS Co., Ltd., which is a listed company in Japan, to apply our GLS to an online lease signing system. We aim to increase the number of use cases of GLS, and offer a general-purpose System Development Kit (“SDK”) for external engineers to improve GLS. SDKs are software development tools for developers to create applications for platforms and systems. Our mission is to keep updating GLS and make it an infrastructure in the coming Web3/metaverse-like data society. We primarily generate revenue from our software and system development services and consulting and solution services. For the six months ended October 31, 2022 and 2021, and the fiscal years ended April 30, 2022 and 2021, we had total revenue of approximately JPY32.2 million (US$0.2 million), JPY190.8 million, JPY463.7 million (US$3.1 million) and JPY216.2 million, respectively. For the same fiscal periods, revenue generated from our software and system development services accounted for approximately 35.3%, 46.2%, 50.6% and 44.1% of our total revenue, respectively, and revenue generated from our consulting and solution services accounted for approximately 64.7%, 53.8%, 49.4% and 55.9% of our total revenue, respectively. For the same fiscal periods, we had net loss of approximately JPY213.3 million (US$1.4 million), JPY644.4 million, JPY602.5 million (US$4.1 million) and JPY70.5 million, respectively. --- Our principal executive office is located at 5-7-11, Ueno, Taito-ku, Tokyo, Japan 110-0005, and our telephone number is +81 03-5614-0978. Our website is www.e-arly.works. Our agent for service of process in the United States is Cogency Global Inc., at 122 East 42nd Street, 18th Floor, New York, NY 10168.
Earlyworks Co., Ltd. annual income statement and balance sheet, FY 2022 to FY 2025, as reported in SEC filings (JPY).
| Metric | FY 2022 | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|---|
| Revenue | JPY 464M | $342K | JPY 179M | JPY 440M |
| Gross profit | JPY 355M | $118K | JPY 142M | JPY 227M |
| Operating income | (JPY 572M) | ($2.9M) | (JPY 381M) | (JPY 246M) |
| Net income | (JPY 4.4M) | ($2.8M) | (JPY 336M) | (JPY 257M) |
| Metric | FY 2022 | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|---|
| Total assets | JPY 752M | $3.3M | JPY 576M | JPY 191M |
| Total liabilities | JPY 161M | $1.8M | JPY 245M | JPY 116M |
| Total equity | JPY 4.3M | $1.5M | JPY 331M | JPY 74.0M |
| Cash & equivalents | JPY 4.8M | $1.3M | JPY 338M | JPY 104M |