PostPrime Inc.

In the event of an economic slowdown or sharp market fluctuations, revenue may be adversely affected through reduced investment appetite among individual investors and lower advertising spend by financial institutions. Although the Company seeks to stabilize revenue through long-term Prime registration and long-term membership programs, it is difficult to completely prevent declines in new user registrations and usage of paid services.

If major SNS operators with strong capital resources, marketing power, and development capabilities develop or modify services to acquire users in the investment and economic fields, there is a risk that active user numbers could decline due to intensified competition and increased costs. The Company strives for early detection and response through competitor and market research, but the timing and extent of any such risk materializing are difficult to predict.

The Company depends heavily on a single business, the SNS "PostPrime," for the majority of its revenue, so a slowdown or contraction of this business due to changes in the business environment or other factors would have a significant impact on performance. Since August 2025, the Company has launched a trading platform business to diversify its revenue structure, but as this new business is still in a nascent development stage, the dependency risk remains ongoing.

The provision of smartphone applications depends on the platforms of Apple Inc. and Google Inc., creating a risk that changes to in-app purchase terms, fees, or business policies could increase costs or make continued app provision difficult. In FY2025 (ended May 2025), smartphone app revenue accounted for approximately 20% of total sales, and the Company is working to diversify this risk by increasing the proportion of sales via web browsers.

On an SNS platform used by an unspecified large number of users, it is difficult to completely prevent illegal or inappropriate conduct such as unauthorized investment advisory solicitation, copyright infringement, or defamation, and the Company may be held responsible as the platform provider if such issues arise. The Company has established and operates terms of use, a violation reporting system, and a post-monitoring framework (in-house customer support and an external specialist team), but there are limits to comprehensively monitoring all posts.

System failures caused by natural disasters, outsourcing partner failures, computer viruses, hacking intrusions, or sudden surges in access could disrupt service continuity, leading to reduced reliability and complaints. Although the Company implements preventive measures such as regular backups and system redundancy, the risk of delayed recovery in the event of a large-scale failure remains.

The Company collects personal information and My Number data from paying users and is subject to obligations under the Personal Information Protection Act and the Number Act. Although it has implemented measures such as obtaining ISMS certification, publishing a privacy policy, establishing internal regulations, and conducting regular training, in the event of an information leak, the Company could face significant impacts on its business, performance, and financial condition due to liability for damages and loss of public trust.

Since the SNS "PostPrime" features a large amount of investment- and economy-related content, it constantly carries the risk of conflicting with the Financial Instruments and Exchange Act as it relates to investment advisory business. In addition, the consolidated subsidiary TakaTrade Co., Ltd., as a commodity futures trading operator, is legally required to maintain a net assets ratio of 120% or higher, and failure to meet this standard could result in administrative sanctions such as business improvement orders or registration revocation. Amendments to laws such as the Telecommunications Business Act, the Copyright Act, and the Payment Services Act, as well as the formulation of new guidelines, also pose risks of new constraints on the business.

The Company's tradable share market capitalization and tradable share ratio are close to the listing maintenance criteria of the Tokyo Stock Exchange, and if these metrics decline for any reason, the Company could fall short of the listing maintenance criteria, potentially leading to reduced market trading activity and a deterioration in supply-demand balance. In addition, against a total of 10,252,060 issued shares, 1,201,940 stock options (a ratio of 10.49%) have been granted, and their exercise could dilute per-share value and affect the supply-demand balance.

Daniel Kei Takahashi, the founder and Representative Director, possesses deep expertise in global finance and economics and plays a key role as a featured presenter on the SNS "PostPrime" and the Company's YouTube channels; in FY2025 (ended May 2025), channels related to him accounted for approximately 30% of total revenue. If he were to become unable to continue his duties, the impact on the business and performance would be significant. While the Company is strengthening information sharing at the Board of Directors level and improving its management organization, reducing this dependency remains a work in progress.