Earlyworks Co., Ltd. Releases Letter to Shareholders

Tokyo, Japan, Sept. 20, 2023 (GLOBE NEWSWIRE) -- Earlyworks Co., Ltd. (Nasdaq: ELWS) (the “Company” or “Earlyworks”), a Japanese company operating its proprietary private blockchain technology, Grid Ledger System (“GLS”), today released a letter to shareholders from Mr. Satoshi Kobayashi, the Chief Executive Officer and Representative Director of the Company.

Dear Shareholders,

As a company that just successfully closed our initial public offering in July 2023, we are grateful about your support for Earlyworks. Our mission is to keep updating GLS and make it an infrastructure in the coming Web3/metaverse-like data society. To achieve that goal, we have been implementing our growth strategies of investing in research and development, securing talented employees, and pursuing alliances with partner companies.

While we are actively planning for the future of Earlyworks, we must acknowledge that there was a decrease in our revenue for the fiscal year of 2023, compared to the fiscal year of 2022. Such decrease was mainly because in the fiscal year of 2022, we entered into a number of contracts to the extent that we were unable to devote substantial resources to research and development activities; most of such contracts were for terms of one year or less and expired during 2023. During the fiscal year of 2023, we were more selective in entering into contracts and conducting projects in which we devoted our resources, and we were engaged in research and development projects that are expected to generate revenue in the future. In our previous business model, we were commissioned by our clients to work on specific projects, and our revenue from software and system development contracts was generally recognized over time as we created or enhanced the projects controlled by our clients. While we collected development fees from these one-off projects, we had to spend enormous resources to develop the products for each client from scratch.

To optimize our business model and stabilize future performance, we have been investing resources in the development of our System Development Kit (“SDK”). We are excited to launch the Phase 1 of the SDK package by the end of October 2023, a meaningful step toward the realization of our mission. With the upcoming introduction of the SDK package, large corporate clients will be able to adopt our software and integrate such software into their own systems with ease, saving us the resources previously dedicated to product customization. We also expect to generate recurring revenue through providing our new SDK package and receive licensing income for GLS.

We are actively engaged in discussions with several major companies to introduce the SDK package.

We remain confident in our business model and our capability to tap into the growth opportunities in the blockchain industry with our talented and dedicated team. We will continue our efforts in research and development projects, strengthen and expand our relationships with clients and solidify our position in the market. Most importantly, we believe that a key measure of our success will be the shareholder value we generate over the long term, in line with which we map out our strategies and make our decisions. Again, we would like to extend our heartfelt thanks to our valued shareholders for your continued support and encouragement. We look forward to seeing a growing future for Earlyworks together.

Satoshi Kobayashi

Chief Executive Officer and Representative Director

Earlyworks Co., Ltd.

About Earlyworks Co., Ltd.

Earlyworks Co., Ltd. is a Japanese company operating its proprietary private blockchain technology, GLS, to leverage blockchain technology in various applications in a wide range of industries. GLS is a hybrid blockchain that combines the technical advantages of blockchain and database technology. GLS features high-speed processing, which can reach 0.016 seconds per transaction, tamper-resistance, security, zero server downtime, and versatile applications. The applicability of GLS is verified in multiple domains, including real estate, advertisement, telecommunications, metaverse, and financial services. The Company’s mission is to keep updating GLS and make it an infrastructure in the coming Web3/metaverse-like data society. For more information, please visit the Company’s website: .

Forward-Looking Statements

Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company’s current expectations and projections about future events that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can find many (but not all) of these statements by the use of words such as “approximates,” “believes,” “hopes,” “expects,” “anticipates,” “estimates,” “projects,” “intends,” “plans,” “will,” “would,” “should,” “could,” “may,” or other similar expressions. The Company undertakes no obligation to update or revise publicly any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results in the Company’s registration statement and other filings with the SEC.

For more information, please contact:

Earlyworks Co., Ltd.

Investor Relations Department

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Ascent Investor Relations LLC

Tina Xiao

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