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As filed with the Securities and Exchange
Commission on March 15, 2021.

Registration Statement No. 333-251234

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 3 to

Form F-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

Infobird
Co., Ltd

(Exact name of Registrant as specified
in its charter)

Not Applicable

(Translation of Registrant’s name
into English)

Cayman
Islands
7372 Not
Applicable

(State
or other jurisdiction of

incorporation or organization)

(Primary
Standard Industrial

Classification Code Number)

(I.R.S.
Employer

Identification Number)

Room 12A05, Block A, Boya International
Center, Building 2, No. 1 Courtyard, Lize Zhongyi Road

Chaoyang District, Beijing, China 100102

86-010-52411819

(Address, including zip code, and telephone
number, including area code, of Registrant’s principal executive offices)

Puglisi & Associates

850 Library Avenue, Suite 204

Newark, DE 19711

302-738-6680

(Name, address, including zip code, and
telephone number, including area code, of agent for service)

Copies
of all communications, including communications sent to agent for service, should be sent to
:

Clayton
E. Parker, Esq.

Matthew L. Ogurick, Esq.

Hillary O’Rourke, Esq.

K&L Gates LLP

Southeast Financial Center,
Suite 3900

200 South Biscayne Boulevard

Miami, Florida 33131-2399

Telephone: 305-539-3300

Fax: 305-358-7095

Richard
A. Friedman, Esq.

Stephen A. Cohen, Esq.

Sheppard, Mullin, Richter & Hampton
LLP

30 Rockefeller Plaza

New York, NY 10112

Telephone: 212-653-8700

Fax: 212-653-8701

Approximate date of commencement of
proposed sale to public:
As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered
on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as
amended, check the following box. x

If this Form is filed to register additional
securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration statement for the same offering. ¨

If this Form is a post-effective amendment
filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same offering. ¨

If this Form is a post-effective amendment
filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same offering. ¨

Indicate by check mark whether the registrant
is an emerging growth company as defined in Rule 405 of the Securities Act: Emerging growth company x

If an emerging growth company that prepares its financial statements
in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards† provided pursuant to Section 7(a)(2)(B) of the Securities
Act. ¨

† The term “new or revised
financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting
Standards Codification after April 5, 2012.

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered Amount to be
Registered(1)
Proposed
Maximum
Aggregate
Offering Price
Per Share(2)
Proposed
Maximum
Aggregate
Offering
Price(1)(2)
Amount of
Registration
Fee(5)
Ordinary shares, par value
$0.001 per share(2)(3)
7,187,500 $ 4.00 $ 28,750,000.00 $ 3,136.63
Representative’s Warrants(4)
Ordinary shares underlying Representative’s
Warrants(4)
625,000 $ 5.00 $ 3,125,000.00 $ 340.94
Total 7,812,500 $ $ 31,875,000.00 $ 3,477.57

(1) Includes
937,500 additional shares that the underwriters have the option to purchase to cover over-allotments, if any.
(2) Estimated solely for the purpose of calculating
the amount of the registration fee in accordance with Rule 457(a) under the Securities Act.
(3) In accordance
with Rule 416(a), we are also registering an indeterminate number of additional ordinary shares that shall be issuable pursuant
to Rule 416 to prevent dilution resulting from share splits, share dividends or similar transactions.
(4) We have agreed
to issue, on the closing date of this offering, warrants, or the representative’s warrants, to the representative of
the underwriters, WestPark Capital, Inc.., in an amount equal to 10% of the aggregate number of ordinary shares sold by us
in this offering, exclusive of the underwriters’ over-allotment option. The exercise price of the representative’s
warrants is equal to 125% of the price of our ordinary shares offered hereby. The representative’s warrants are exercisable
for a period of five years from the effective date of the registration statement of which this prospectus forms a part and
will terminate on the fifth anniversary of the effective date of the registration statement.
(5) Previously paid.

The Registrant hereby amends this registration
statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment
which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a)
of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Commission,
acting pursuant to such Section 8(a), may determine.

The information
in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed
with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not
soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

Subject
to Completion,
DATED MARCH 15, 2021

PRELIMINARY
PROSPECTUS

6,250,000 Ordinary Shares

Infobird Co., Ltd

We are offering 6,250,000
ordinary shares. This is the initial public offering of ordinary shares of Infobird Co., Ltd. The offering price of our ordinary
shares in this offering is expected to be $4.00 per share. Prior to this offering, there has been no public market for our ordinary
shares.

Our ordinary shares
have been approved for listing on the Nasdaq Capital Market under the symbol “IFBD.”

Investing in our ordinary shares is
highly speculative and involves a high degree of risk. Before buying any shares, you should carefully read the discussion of material
risks of investing in our ordinary shares in “Risk Factors” beginning on page 10 of this prospectus.

We are an “emerging
growth company” as defined under the federal securities laws and, as such, will be subject to reduced public company reporting
requirements. See “Prospectus Summary—Implications of Being an Emerging Growth Company and a Foreign Private Issuer”
for additional information.

Neither the Securities
and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy
or adequacy of this prospectus. Any representation to the contrary is a criminal offense.

PER SHARE TOTAL
Initial public offering price $ $
Underwriting discounts and commissions(1) $ $
Proceeds, before expenses, to us $ $

(1) We have agreed
to issue, on the closing date of this offering, warrants, or the representative’s warrants, to the representative of the
underwriters, WestPark Capital, Inc., in an amount equal to 10% of the aggregate number of ordinary shares sold by us in this
offering, exclusive of the underwriters’ over-allotment option. For a description of other terms of the representative’s
warrants and a description of the other compensation to be received by the underwriters, see “Underwriting” beginning
on page 105.

We expect our total
cash expenses for this offering (including cash expenses payable to our underwriters for their out-of-pocket expenses) to be approximately
$669,759, exclusive of the above discounts and commissions. In addition, we will pay additional items of value in connection with
this offering that are viewed by the Financial Industry Regulatory Authority, or FINRA, as underwriting compensation. These payments
will further reduce proceeds available to us before expenses. See “Underwriting.”

This offering is
being conducted on a firm commitment basis. The underwriters are obligated to take and pay for all of the shares if any such shares
are taken. We have granted the underwriters an option for a period of forty-five (45) days after the closing of this offering
to purchase up to 15% of the total number of our ordinary shares to be offered by us pursuant to this offering (excluding shares
subject to this option), solely for the purpose of covering over-allotments, at the initial public offering price less the underwriting
discounts and commissions. If the underwriters exercise the option in full, the total underwriting discounts and commissions payable
will be $2,012,500 based on an assumed initial public offering price of $4.00 per ordinary share, and the total gross proceeds
to us, before underwriting discounts and commissions and expenses, will be $28,750,000. If we complete this offering, net proceeds
will be delivered to us on the closing date. We will not be able to use such proceeds in China, however, until we complete capital
contribution procedures which require prior approval from each of the respective local counterparts of China’s Ministry
of Commerce, the State Administration for Market Regulation, and the State Administration of Foreign Exchange. See remittance
procedures in the section titled “Use of Proceeds” beginning on page 38.

The underwriters
expect to deliver the ordinary shares against payment as set forth under “Underwriting”, on or about     ,
2021.

WESTPARK
CAPITAL, INC.

GF
SECURITIES (HONG KONG) BROKERAGE LIMITED

The date of this prospectus is      ,
2021.

TABLE OF CONTENTS

We are responsible
for the information contained in this prospectus and any free writing prospectus we prepare or authorize. We have not, and the
underwriters have not, authorized anyone to provide you with different information, and we and the underwriters take no responsibility
for any other information others may give you. We are not, and the underwriters are not, making an offer to sell our ordinary
shares in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in this
prospectus is accurate as of any date other than the date on the front cover of this prospectus, regardless of the time of delivery
of this prospectus or the sale of any ordinary shares.

For investors outside
the United States: Neither we nor the underwriters have done anything that would permit this offering or possession or distribution
of this prospectus in any jurisdiction, other than the United States, where action for that purpose is required. Persons outside
the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating
to, the offering of the ordinary shares and the distribution of this prospectus outside the United States.

We
are incorporated under the laws of the Cayman Islands as an exempted company with limited liability and a majority of our outstanding
securities are owned by non-U.S. residents. Under the rules of the U.S. Securities and Exchange Commission, or the SEC, we currently
qualify for treatment as a “foreign private issuer.” As a foreign private issuer, we will not be required to file
periodic reports and financial statements with the Securities and Exchange Commission, or the SEC, as frequently or as promptly
as domestic registrants whose securities are registered under the Securities Exchange Act of 1934, as amended, or the Exchange
Act.

Until
and including       , 2021 (twenty-five (25) days after the date of this prospectus), all dealers
that buy, sell or trade our ordinary shares, whether or not participating in this offering, may be required to deliver a prospectus.
This delivery requirement is in addition to the obligation of dealers to deliver a prospectus when acting as underwriters and
with respect to their unsold allotments or subscriptions.

CONVENTIONS
THAT APPLY TO THIS PROSPECTUS

Unless
otherwise indicated or the context otherwise requires, all references in this prospectus to the terms the “Company,”
“we,” “us” and “our” refer to
Infobird Co., Ltd and its
subsidiaries, its variable interest entity and the subsidiaries of its variable interest entity.

“PRC”
or “China” refers to the People’s Republic of China, excluding, for the purpose of this prospectus, Taiwan,
Hong Kong and Macau. “RMB” or “Renminbi” refers to the legal currency of China. “$” or “U.S.
dollars” refers to the legal currency of the United States.

We have made rounding
adjustments to some of the figures included in this prospectus. Accordingly, numerical figures shown as totals in some tables
may not be an arithmetic aggregation of the figures that preceded them.

Unless the context
indicates otherwise, all information in this prospectus assumes no exercise by the underwriters of their over-allotment option
and no exercise of the representative’s warrants.

Our independent registered
public accounting firm has not yet reviewed our financial results for the second half of the 2020 fiscal year or the full 2020
fiscal year. Information included herein regarding financial results or expectations for the second half of the 2020 fiscal year,
the full 2020 fiscal year or the full 2021 fiscal year reflects our preliminary estimates of certain anticipated financial results
for such periods. The estimates included herein regarding certain anticipated results for the second half of the 2020 fiscal year,
the full 2020 fiscal year and the full 2021 represent the most current information available to management and do not present
all necessary information for an understanding of our expected financial condition as of, and our expected results of operations
for, such periods. Further, our actual results may differ from such preliminary estimates, and such preliminary estimates are
not necessarily indicative of any future period.

Our functional currency
is RMB. Our consolidated financial statements are presented in U.S. dollars. We use U.S. dollars as the reporting currency in
our consolidated financial statements and in this prospectus. Assets and liabilities are translated into U.S. dollars at the noon
buying rate in the City of New York for cable transfers of RMB as certified for customs purposes by the Federal Reserve Bank of
New York as of the balance sheet dates, the statements of income are translated using the average rate of exchange in effect during
the reporting periods, and the equity accounts are translated at historical exchange rates. Translation adjustments resulting
from this process are included in accumulated other comprehensive income (loss). Transaction gains and losses that arise from
exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results
of operations as incurred. The balance sheet amounts, with the exception of equity at June 30, 2020 and December 31, 2019, were
translated at RMB 7.0651 and RMB 6.9618, respectively. The equity accounts were stated at their historical rate. The average translation
rates applied to statement of income accounts for the six months ended June 30, 2020 and 2019 were RMB 7.0322 and RMB 6.7836 to
$1.00, respectively. Cash flows were also translated at average translation rates for the periods, therefore, amounts reported
on the statements of cash flows will not necessarily agree with changes in the corresponding balances on the consolidated balance
sheets.

With respect to amounts
not recorded in our consolidated financial statements included elsewhere in this prospectus, unless otherwise stated, all translations
from RMB to U.S. dollars were made at RMB 7.0651 to $1.00, the noon buying rate on June 30, 2020, as set forth in the H.10 statistical
release of the Board of Governors of the Federal Reserve System. We make no representation that the RMB or U.S. dollar amounts
referred to in this prospectus could have been or could be converted into U.S. dollars or RMB, as the case may be, at any particular
rate or at all.

PROSPECTUS SUMMARY

The following
summary highlights information contained elsewhere in this prospectus and does not contain all of the information you should consider
before investing in our ordinary shares. You should read the entire prospectus carefully, including “Risk Factors,”
“Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and our consolidated
financial statements and the related notes thereto, in each case included in this prospectus. You should carefully consider, among
other things, the matters discussed in the section of this prospectus titled “Business” before making an investment
decision.

Overview

We are a software-as-a-service,
or SaaS, provider of innovative AI-powered, or artificial intelligence enabled, customer engagement solutions in China. Leveraging
self-developed cloud-native architecture, AI and machine learning capabilities, patented Voice over Internet Protocol or VoIP,
application technologies, no-code development platform, and in-depth industry expertise, we primarily provide holistic software
solutions to help our corporate clients proactively deliver and manage end-to-end customer engagement activities at all stages
of the sales process including pre-sales and sales activities and post-sales customer support. We also offer AI-powered cloud-based
sales force management software including intelligent quality inspection and intelligent training software to help our clients
monitor, benchmark and improve the performances of agents. We empower our clients with our business value-driven solutions to
increase revenue, reduce cost, and enhance customer service quality and customer satisfaction. We currently specialize in serving
corporate clients in the finance industry and also cover a broad array of other industries, including the education, public services,
healthcare and consumer products industries. We believe we are one of the leading and long-standing domestic SaaS providers in
serving large enterprises in the finance industry in customer engagement with over 10 years of experience. We offer a comprehensive
portfolio of customer engagement SaaS solutions that are highly intelligent, customizable and with proof of stability and security
at scale with concurrence of over 10,000 agents. We continue to innovate by developing technologies that enable us to deliver
a series of solutions and services which address the evolving and changing needs of our corporate clientele.

According to the
Report on the Industry Trend of SaaS in China published by Business Partner Consulting in March 2020, the SaaS industry
is a fast-growing market in China, surging from approximately $2.3 billion in 2019 to $3.3 billion in 2020, and is expected to
grow to approximately $6.9 billion in 2022. We believe the growth of the SaaS industry is driven by the digital transformation
in the business world, in particular domestic PRC markets, and in particular, we believe that companies are investing significantly
in SaaS during such digital transformation. We also believe AI-powered customer engagement SaaS is disrupting traditional customer
engagement tools. The former proactively extracts, consolidates, analyzes, and predicts customer interactions in an omni-channel
environment with the assistance of AI, while the latter passively receives, records, reacts to, and reports on customer data without
the assistance of AI. We believe that a combination of industry expertise on SaaS and novel technologies, such as AI and machine
learning capabilities, is the progressing trend in the customer engagement industry.

We rely on the following
self-developed novel technologies to deliver customizable, high-quality, scalable, configurable, secure, and steady customer engagement
solutions:

· Cloud-native
architecture.
We use a cloud-native architecture as the basic infrastructure
for our software, which empowers us with flexible scale-out capabilities and high tolerance
of failures and default, and supports ultra-large-scale concurrence capabilities.
· AI
and machine learning capabilities.
We incorporate our self-developed natural
language processing, or NLP, licensed automatic speech recognition, or ASR, and text
to speech, or TTS, to empower our software to have the capability of conducting multiple
rounds of free conversations with customers, referring to the context for better understanding,
automatically capturing key words, recognizing the intentions of customers and accurately
converting voice to text or vice versa.
· Patented
VoIP technologies.
Our patented VoIP technologies ensure high-quality telecommunications
through intelligent routing, multi-voice coding support, and multi-endpoint access support.
The intelligent routing and multi-voice coding support enable us to provide optimal voice
transmission quality by monitoring network fluctuation to deploy voice routing notes
and adjusting voice coding based on the latest status of network bandwidth.
· No-code
development platform.
We developed a no-code development platform that is flexible
by design, enabling us to deploy pre-coded microservice modules and packages to quickly
respond and adjust to customer requirements, and we can also combine microservice modules
into customized end-to-end solutions, and thus, significantly reduce the time required
for our software engineers to program customized services and products for our clients.
Our software developed through the no-code development platform also supports open application
programming interface, or API, and software development kit, or SDK, and therefore allows
easy integration with our clients’ call centers, websites, and software.

Our customer engagement
services are founded on a series of our customer engagement software, and each may be used on an individual and/or integrated
basis. The following are the primary types of our fundamental software:

AI Customer Engagement
Software

· Cloud
call center
– proprietary technologies that ensure scalable, steady, secure,
and flexible access to accounts and also support functions which can automatically initiate
outbound calls by taking into account available agents, anticipated talk time, and anticipated
wait time, and then distribute the answered calls to the agents.
· Intelligent
telemarketing
– automatically initiate calls in batch files, which are files
often used to help load programs, run multiple processes at a time, perform
common or repetitive tasks, support AI voice Chatbot and collect information from interactions
between sales representatives and customers to create labels for each customer and to
analyze and predict customer behaviors.
· Intelligent
omni-channel customer service
– integrate interactions through telephone calls,
videos, emails, social media platforms, websites, and text messages, and provide tickets
that can promote business flows across different departments.
· AI
voice Chatbot and AI text Chatbot
– multiple rounds of free conversation with
customers, referring to the context for better understanding, and recognizing the intentions
of customers.

AI Sales Force
Management Software

· Intelligent
quality inspection
– monitoring and benchmarking performances of sales and
customer service representatives, and aiding in the fulfillment of obligations under
compliance regulations.
· Intelligent
training
– interactive training sessions and tests with computers for sales
and customer service representatives.

We value our proprietary
technologies and strong research and development capabilities, which we believe differentiate us from other software companies
in the customer engagement industry. As of December 31, 2020, we had an intellectual property portfolio consisting of 19 patents,
13 patents in various stages of the registration application process, 51 software copyrights, 1 artwork copyright in the registration
application process, 39 registered trademarks, 5 trademark applications and 27 domain names in the PRC and 3 registered trademarks
outside of the PRC.

We design our software
to be easy to use, customizable and self-operated. We allow our clients to incorporate their business needs and/or approach to
customer management in our software by using our self-developed no-code programming technology. Clients may also configure certain
parameters and scripts for agents. Our software also allows easy integration with our clients’ call centers, websites and
software. Through years of experience serving our clients and analyzing the interactions between our clients and their customers,
we have accumulated valuable vertical knowledge and know-how of our clients’ industries. We continually strive to understand
the objectives of our clients at different stages of their businesses to further our understanding on their operating industries.
We have integrated this knowledge with our technology to develop software that provides a comprehensive customer experience.

Industry Background

The SaaS industry
has been growing rapidly in China driven by the digital transformation in the business world and the favorable government policies.
According to the Report on the Industry Trend of SaaS in China published by Business Partner Consulting in March 2020,
the market size of the SaaS industry in China was approximately $2.3 billion in 2019 and grew to approximately $3.3 billion in
2020 at a compound annual growth rate of 43.5%. It is further estimated that the growth rate of SaaS industry will remain high
in the next two years and market size will grow to approximately $6.9 billion in 2022. The report also states that the industry
trend of SaaS is (i) to become more intelligent with artificial intelligence, or AI, and big data technologies; and (ii) to incorporate
industry expertise and vertically grow to penetrate markets in other industries including the finance, healthcare, education,
transportation, public services and retail industries.

The PRC government
has emphasized development and application of cloud computing, such as SaaS, and issued several supporting policy documents not
only on the big-picture level but also on the industry specific level. In July 2018, the Ministry of Industry and Information
Technology of the PRC, or the MIIT, issued the Three-year Action Plan for Expanding and Upgrading Information Consumption of
Enterprises (2018-2020)
and the Guidelines for Promoting Enterprises to Move Business to Cloud Platforms (2018-2020). The
former requires an increase on the scale of information consumption to reach approximately RMB 6.0 trillion (approximately $849.2
billion) by 2020, while the latter requires an additional one million enterprises in China to initiate digital transformation
and conduct business on cloud computing services in China by 2020. Regarding a specific industry, for instance, the finance industry,
People’s Bank of China issued the Development Plan for Financial Technology (FinTech) (2019-2021) in August 2019,
which stated the mission to upgrade the technologies applied in the finance industry, including cloud computing, AI, and big data
by 2021.

Businesses have been
investing heavily in digital transformation, with customer engagement as one of the largest areas of investment. AI-powered customer
engagement SaaS is disrupting the traditional customer engagement tools as the latter fails to satisfy the evolving needs of a
dynamic digital economy. The AI-powered customer engagement SaaS optimizes customers’ experiences and creates business value
by proactively extracting, consolidating, analyzing, and predicting customer interactions from an omni-channel environment. Conversely,
the traditional customer engagement tools passively receive, record, react to, and report on customer data. We believe that a
combination of industry expertise on SaaS and novel technologies, such as AI and machine learning capabilities, is the progressing
trend in the customer engagement industry.

The finance industry
has significant market potential in information technology, or IT, services, which includes SaaS. According to the industry report
released by Northeastern Securities in November 2019, the market potentials of IT services in the banking and insurance sectors
in 2018 were approximately RMB 111.7 billion (approximately $15.8 billion) and RMB 24.4 billion (approximately $3.5 billion),
respectively, and are expected to maintain an annual growth rate of over 20% in the next five years. International Data Corporation,
or IDC, predicted in 2019 that the total expenditures of Chinese financial institutions on IT will exceed $21.5 billion in 2020.

Artificial
Intelligence Industry in China

According to the
Baidu Brain Leadership White Paper jointly released by International Data Corporation, or IDC, and Baidu AI Industry Research
Center, as of March 2019, artificial intelligence technology is expected to penetrate various applications and business scenarios
of enterprises, which in turn is expected to inevitably change the traditional human resource structure, business processes and
industry structure of enterprises in China. IDC predicts that China’s AI market will reach $9.84 billion by 2022.

IDC tracked approximately
70 industry application scenarios and found that intelligent customer service was the most widely used service in various industries.
Furthermore, IDC found that automatic speech recognition technology and natural language understanding technology were the two
crucial AI technologies for intelligent customer service, which are also incorporated in our products. We believe our AI technologies
have great market potential and applications and are likely to increase the appeal of our SaaS products.

Competitive Strengths

We believe the following
competitive strengths differentiate us from our competitors and will continue to contribute to our success:

· Advanced
and Proprietary Technologies.
Our products and services are highly adaptable,
scalable and supported by our flexible technology infrastructures, enabling us to efficiently
address the needs of our clients.

· Innovative
No-code Development Platform
. Our
self-developed cloud-based no-code development platform significantly reduces the software
development period and allows us to quickly customize and package our SaaS to meet market
demand.

· Rich
experience in Serving Large Enterprises.
We believe we are one of the leading and long-standing domestic SaaS providers
in serving large enterprises in the finance industry with over 10 years of experience. We believe we have also accumulated
deep experiences in serving large enterprises in other industries such as IT, retail and education industries. We offer a
comprehensive portfolio of customer engagement SaaS services that are highly intelligent, customizable and we ensure stability
and security under large volume of services of concurrence of over 10,000 agents.

· Strong
Relationships with Clients, Industry Expertise and Diverse Client Base.
We value
our in-depth vertical knowledge in our clients’ industries, which we believe enables
us to better understand and predict the needs of our clients and their end users. Our
clients include enterprises across a broad range of industries.

· Strong
Research and Development Capabilities.
We have invested significant resources
in research and development. We have built a strong research and development team and,
as of December 31, 2020, we had a robust intellectual property portfolio consisting of
19 patents, 13 patents in various stages of the registration application process, 51
software copyrights, 1 artwork copyright in the registration application process, 39
registered trademarks, 5 trademark applications and 27 domain names in the PRC and 3
registered trademarks outside of the PRC.

· Award-winning
and Recognized Company.
We believe we have built a trusted brand with a history
of delivering value to our clients. We have received numerous industry, trade association
and governmental awards relating to our business and operations, which we believe serve
to enhance our brand and reputation.

· Visionary
and Experienced management team.
We have a visionary and experienced management
team with strong execution capability. We believe that the extensive experience, service
and product knowledge, strategic vision and execution capabilities of our management
team will allow us to continue to execute our growth strategies to achieve a high level
of success.

Our Strategy

Our goal is to become
one of the leading customer engagement SaaS solutions providers in China. We aim to achieve this goal by implementing the following
strategies:

· Expand
client base in the finance industry with enhanced sales and marketing and solutions.

· Penetrate
other mature industries.

· Strengthen
sales and marketing.
o Improve
clients’ lifecycle management.
o Deploy
further indirect sales channels.
o Increase
brand awareness.

· Continue
to invest in research and development to deploy further AI and machine learning capabilities.

Corporate History and Structure

Infobird Co., Ltd,
or Infobird Cayman, is a holding company incorporated on March 26, 2020 under the laws of the Cayman Islands. We have no substantive
operations other than holding all of the outstanding share capital of Infobird International Limited, or Infobird HK, which was
established in Hong Kong on April 21, 2020. Infobird HK is also a holding company holding all of the outstanding equity of Infobird
Digital Technology (Beijing) Co., Ltd, or Infobird WFOE, which was established on May 20, 2020 under the laws of the PRC.

We, through our variable
interest entity, or VIE, Beijing Infobird Software Co., Ltd, or Infobird Beijing, a PRC limited liability company, and through
its subsidiaries, principally engage in developing and providing customer engagement cloud-based services. The officers of Infobird
Beijing are (i) Yimin Wu, chairman of the board of directors and the chief executive officer of each of Infobird Beijing and Infobird
Cayman; (ii) Hsiaochien Tseng, executive vice president of each of Infobird Beijing and Infobird Cayman; and (iii) Chunhsiang
Chen, vice president of Infobird Beijing and chief technology officer and vice president of Infobird Cayman. The board of directors
of Infobird Beijing consists of three individuals: (i) Yimin Wu; (ii) Bing Weng, a shareholder of Infobird Beijing and the sole
director and shareholder of OmniConnect Limited, one of Infobird Cayman’s principal shareholders; and (iii) Dongliang Jiang,
one of Infobird Cayman’s directors and the sole director and shareholder of Orbitchannel Limited, one of Infobird Cayman’s
principal shareholders.

Infobird Beijing,
a PRC limited liability company, was established on October 26, 2001 under the laws of the PRC. On October 17, 2013, Infobird
Beijing established a 90.18% owned subsidiary, Guiyang Infobird Cloud Computing Co., Ltd, or Infobird Guiyang, a PRC limited liability
company, while Shengmin Wu, the brother of Yimin Wu, owns 0.82% and Lanlan Luo, an unrelated third party, owns 9.00% of the noncontrolling
interests in Infobird Guiyang. On June 20, 2012, Infobird Beijing established a 99.95% owned subsidiary, Anhui Infobird Software
Information Technology Co., Ltd, or Infobird Anhui, a PRC limited liability company, while Ji Meng, a shareholder of Infobird
Beijing and a shareholder of one of our principal shareholders, CRExperience Limited, owns 0.05% of the noncontrolling interests
in Infobird Anhui. Infobird Guiyang engages in software development and mainly provides business process outsourcing, or BPO,
services to customers, and Infobird Anhui engages in software development and mainly provides cloud services and technology solutions
to customers.

Reorganization

On May 27, 2020, Infobird
Cayman completed a reorganization of entities under common control of its then existing shareholders, who collectively owned all
of the equity interests of Infobird Cayman prior to the reorganization. Infobird Cayman and Infobird HK were established as the
holding companies of Infobird WFOE. Infobird WFOE is the primary beneficiary of Infobird Beijing and its subsidiaries. All of
these entities are under common control which results in the consolidation of Infobird Beijing and subsidiaries which have been
accounted for as a reorganization of entities under common control at carrying value. The consolidated financial statements are
prepared on the basis as if the reorganization became effective as of the beginning of the first period presented in the consolidated
financial statements of Infobird Cayman. The sale of Infobird Cayman’s securities in March 2020 was in the same proportion
as the ownership of Infobird Beijing prior to the reorganization. To our knowledge, such investors still currently own their same
interests in Infobird Beijing.

The charts below
summarize our corporate legal structure and identify our subsidiaries, our VIE and its subsidiaries as of the date of this prospectus
and upon completion of this offering:

Name Background Ownership
Infobird International Limited

· A Hong Kong company

· Incorporated on April 21, 2020

· A holding company

100% owned by Infobird Co., Ltd
Infobird Digital Technology (Beijing) Co., Ltd

· A
PRC limited liability company and deemed a wholly foreign owned enterprise, or WFOE

· Incorporated on May 20, 2020

· Registered capital of $15,000,000 (RMB 106,392,000)

· A holding company

100% owned by Infobird International Limited
Beijing Infobird Software Co., Ltd

· A PRC limited liability company

· Incorporated on October 26, 2001

· Registered capital of $2,417,947 (RMB 16,624,597)

VIE of Infobird Digital Technology (Beijing) Co., Ltd
Guiyang Infobird Cloud Computing Co., Ltd

· A PRC limited liability company

· Incorporated on October 17, 2013

· Registered capital of $1,777,645 (RMB 12,222,200)

90.18% owned by Beijing Infobird Software Co., Ltd
Anhui Infobird Software Information Technology Co., Ltd

· A PRC limited liability company

· Incorporated on June 20, 2012

· Registered capital of $1,454,440 (RMB 10,000,000)

99.95% owned by Beijing Infobird Software Co., Ltd

Contractual Arrangements

Due to legal restrictions
on foreign ownership and investment in, among other areas, the development and operation of information technology in China, including
cloud computing and big data analytics, we operate our businesses in which foreign investment is restricted or prohibited in the
PRC through certain PRC domestic companies. Neither we nor our subsidiaries own any equity interest in Infobird Beijing. As such,
Infobird Beijing is controlled through contractual arrangements in lieu of direct equity ownership by Infobird Cayman or any of
its subsidiaries. Such contractual arrangements consist of a series of three agreements, along with shareholders’ powers
of attorney, or POAs, and spousal consent letters, or collectively the Contractual
Arrangements, which were signed on May 27, 2020.

The significant terms
of the Contractual Arrangements are as follows:

Exclusive Business Cooperation Agreement

Pursuant to the exclusive
business cooperation agreement between Infobird WFOE and Infobird Beijing, Infobird WFOE has the exclusive right to provide Infobird
Beijing with technical support services, consulting services and other services, including technical support and training, business
management consultation, consultation, collection and research of technology and market information, marketing and promotion services,
customer order management and customer services, lease equipment or properties, provide legitimate rights to use software license,
provide deployment, maintenances and upgrade of software, design installation, daily management, maintenance and updating network
system, hardware and database, and other services requested by Infobird Beijing from time to time to the extent permitted under
PRC law. In exchange, Infobird WFOE is entitled to a service fee that equals to all of the consolidated net income. The service
fee may be adjusted by Infobird WFOE based on the actual scope of services rendered by Infobird WFOE and the operational needs
and expanding demands of Infobird Beijing. Pursuant to the exclusive business cooperation agreement, the service fees may be adjusted
based on the actual scope of services rendered by Infobird WFOE and the operational needs of Infobird Beijing.

The exclusive business
cooperation agreement remains in effect unless terminated in accordance with the following provision of the agreement or terminated
in writing by Infobird WFOE.

During the term of
the exclusive business cooperation agreement, Infobird WFOE and Infobird Beijing shall renew the operation term prior to the expiration
thereof so as to enable the exclusive business cooperation agreement to remain effective. The exclusive business cooperation agreement
shall be terminated upon the expiration of the operation term of either Infobird WFOE or Infobird Beijing if the application for
renewal of the operation term is not approved by relevant government authorities. If an application for renewal of the operation
term is not approved, according to the PRC Company Law, the expiration of the operation term may lead to the dissolution and cancellation
of such PRC company.

Exclusive Option Agreements

Pursuant to the exclusive
option agreements among Infobird WFOE, Infobird Beijing and the shareholders who collectively owned all of Infobird Beijing, such
shareholders jointly and severally grant Infobird WFOE an option to purchase their equity interests in Infobird Beijing. The purchase
price shall be the lowest price then permitted under applicable PRC laws. Infobird WFOE or its designated person may exercise
such option at any time to purchase all or part of the equity interests in Infobird Beijing until it has acquired all equity interests
of Infobird Beijing, which is irrevocable during the term of the agreements.

The exclusive option
agreements remain in effect until all equity interest held by shareholders in Infobird Beijing has been transferred or assigned
to Infobird WFOE and/or any other person designated by the Infobird WFOE in accordance with such agreement.

Equity Interest Pledge Agreements

Pursuant to the equity
interest pledge agreements, among Infobird WFOE, Infobird Beijing, and the shareholders who collectively owned all of Infobird
Beijing, such shareholders pledge all of the equity interests in Infobird Beijing to Infobird WFOE as collateral to secure the
obligations of Infobird Beijing under the exclusive business cooperation agreement and exclusive option agreements. These shareholders
are prohibited from transferring the pledged equity interests without the prior consent of Infobird WFOE unless transferring the
equity interests to Infobird WFOE or its designated person in accordance to the exclusive option agreements.

The equity interest
pledge agreements shall come into force the date on which the pledged interests are recorded, which is within three (3) days after
signing of the agreements on May 27, 2020, under Infobird Beijing’s register of shareholders and are registered with the
competent Administration for Market Regulation of Infobird Beijing until all of the obligations to Infobird WFOE have been fulfilled
completely by Infobird Beijing. We intend to register the pledges of equity interest of shareholders with the competent Administration
for Market Regulation in accordance with the Civil Code of the PRC.

Shareholders’ POAs

Pursuant to the shareholders’
POAs, the shareholders of Infobird Beijing give Infobird WFOE an irrevocable proxy to act on their behalf on all matters pertaining
to Infobird Beijing and to exercise all of their rights as shareholders of Infobird Beijing, including the (i) right to attend
shareholders meeting; (ii) to exercise voting rights and all of the other rights including but not limited to the sale or transfer
or pledge or disposition of the shares held in part or in whole; and (iii) designate and appoint on behalf of the shareholder
the legal representative, the directors, supervisors, the chief executive officer and other senior management members of Infobird
Beijing, and to sign transfer documents and any other documents in relation to the fulfillment of the obligations under the exclusive
option agreements and the equity interest pledge agreements. The shareholders’ POAs shall remain in effect while the shareholders
of Infobird Beijing hold the equity interests in Infobird Beijing.

Spousal Consent Letters

Pursuant to the spousal
consent letters, the spouses of the shareholders of Infobird Beijing commit that they have no right to make any assertions in
connection with the equity interests of Infobird Beijing, which are held by the shareholders. In the event that the spouses obtain
any equity interests of Infobird Beijing, which are held by the shareholders, for any reasons, the spouses of the shareholders
shall be bound by the exclusive option agreement, the equity interest pledge agreement, the shareholder POA and the exclusive
business cooperation agreement and comply with the obligations thereunder as a shareholder of Infobird Beijing. The letters are
irrevocable and shall not be withdrawn without the consent of Infobird WFOE.

Based on the foregoing
contractual arrangements, which grant Infobird WFOE effective control of Infobird Beijing and subsidiaries and enable Infobird
WFOE to receive all of their expected residual returns, we account for Infobird Beijing as a VIE. Accordingly, we consolidate
the accounts of Infobird Beijing and subsidiaries for the periods presented herein, in accordance with Regulation S-X-3A-02 promulgated
by the SEC, and Accounting Standards Codification, or ASC, 810-10, Consolidation.

Risks Associated with Our Business

Our business is subject
to a number of risks, including risks that may prevent us from achieving our business objectives or may materially and adversely
affect our business, financial condition, results of operations, cash flows and prospects that you should consider before making
a decision to invest in our ordinary shares. These risks are discussed more fully in “Risk Factors” beginning on page 10.
These risks include, but are not limited to, the following:

·

We depend upon the Contractual Arrangements in conducting
our business in China, which may not be as effective as direct ownership.

·

We face risks related to natural disasters, health
epidemics and other outbreaks, specifically the coronavirus, which could significantly disrupt our operations.

·

We have a limited
operating history. There is no assurance that our future operations will be profitable. If
we cannot generate sufficient revenues to operate profitably, we may suspend or cease operations.

·

We generate a significant portion
of our revenues primarily from a single major customer, China Guangfa Bank, which accounted for 75.5% and 77.3% of our
total revenues for the six months ended June 30, 2020 and for the year ended December 31, 2019, respectively, and loss
of business from such customer could reduce our revenues and significantly harm our business.

· We operate in highly competitive markets and the size and resources
of many of our competitors may allow them to compete more effectively than we can, preventing us from achieving profitability.

·

Our
future growth depends in part on new products and new technology innovation, and failure
to invent and innovate could materially and adversely impact our business prospects.

· Our directors, officers and principal shareholders have significant
voting power and may take actions that may not be in the best interests of our other shareholders.

· If we are not able to adequately protect our proprietary intellectual
property and information, and protect against third party claims that we are infringing on their intellectual property rights,
our results of operations could be adversely affected.

· Changes in China’s economic, political or social conditions
or government policies could have a material adverse effect on our business and operations.

· Uncertainties with respect to China’s legal system could
materially and adversely affect us.

·

Changes in international trade
policies, trade disputes, barriers to trade, or the emergence of a trade war may dampen growth in China and may have a
material adverse effect on our business.

As of the date of
this prospectus, our directors, officers and principal shareholders holding 5% or more of our ordinary shares, collectively, control
approximately 67.13% of our ordinary shares. After this offering, it is expected that our directors, officers and principal shareholders
holding 5% or more of our ordinary shares, collectively, will hold a controlling interest in our ordinary shares as they will
hold approximately 50.51% of our outstanding ordinary shares. As a result, these shareholders, if they act together, will be able
to control the management and affairs of our company and most matters requiring shareholder approval, including the election of
directors and approval of significant corporate transactions.

For the six months
ended June 30, 2020 and 2019, one customer, China Guangfa Bank, accounted for 75.5% and 81.0% of our total revenues, respectively,
and as of June 30, 2020, the same one customer, China Guangfa Bank, accounted for 91.5% of the total balance of our accounts receivable.
For the year ended December 31, 2019, one customer, China Guangfa Bank, accounted for 77.3% of our total revenues and the same
one customer, China Guangfa Bank, accounted for 77.6% and another customer accounted for 10.4%, respectively, of the total balance
of our accounts receivable. For the year ended December 31, 2018, one customer, China Guangfa Bank, accounted for 76.7% of our
total revenues and the same one customer, China Guangfa Bank, accounted for 88.4% of the total balance of our accounts receivable.
The decline in customized cloud-based services revenue, which is attributed to China Guangfa Bank, for the six months ended June
30, 2020 was due to the impact of COVID-19. Aside from the impact of COVID-19, China Guangfa Bank also changed its internal strategy
of telemarketing, which resulted in a decrease in the number of paid user accounts subscribed by China Guangfa Bank in the second
half of 2020 as compared to prior periods. Due to the impact of COVID-19 and China Guangfa Bank’s change in internal strategy
of telemarketing, our customized cloud-based services revenue in the fiscal year 2020 will be lower compared to the fiscal year
2019. We expect such revenue to continue declining in the fiscal year 2021 mainly due to China Guangfa Bank’s decrease in
its demand for, and usage of, our corresponding products and services. Currently, China Guangfa Bank’s internal telemarketing
strategy is to increase its internal IT capabilities. Therefore, China Guangfa Bank no longer procures such services from a third-party
provider, including us, which affects the services we provide to China Guangfa Bank. Due to our long-lasting relationship with
China Guangfa Bank, we have been actively communicating with China Guangfa Bank to explore cooperative opportunities involving
our standard cloud-based services in other business lines. In addition, our latest services contract with China Guangfa Bank was
effective on April 1, 2019 for a service period of fifteen months and expired on June 30, 2020. The termination of the latest
contract required mutual written consent from us and China Guangfa Bank. We were to provide China Guangfa Bank access to the customized
SaaS, which included telecommunications services, such as telephone calls and messaging, and technical support. China Guangfa
Bank has not renewed such agreement, and we and China Guangfa Bank are currently not operating under such agreement. In addition,
we entered into a separate services contract with China Guangfa Bank for the provision of data analysis and research services.
The contract had a three-year term from January 1, 2018 and expired on December 31, 2020. China Guangfa Bank could terminate this
contract at any time. China Guangfa Bank has not renewed such agreement, and we and China Guangfa Bank are currently not operating
under such agreement. We do not derive material amounts of revenue from such expired telecommunications services agreement with
China Guangfa Bank. We are negotiating with China Guangfa Bank to provide new products and services to China Guangfa Bank. It
is currently preliminarily anticipated that China Guangfa Bank will account for less than 5%, approximately 30% and approximately
5% of the Company’s total revenues for the second half of the 2020 fiscal year, the full 2020 fiscal year and the full 2021
fiscal year, respectively. In 2021 and beyond, we expect our revenues will not be largely solely driven from a single major customer,
and we expect our standard cloud-based services will constitute the major portion of our fiscal year 2021 revenue as compared
to customized cloud-based services.

Implications of Being an Emerging Growth Company and a Foreign
Private Issuer

As a company with
less than $1.07 billion in revenue during our last fiscal year, we qualify as an “emerging growth company” as defined
in the Jumpstart Our Business Startups Act, or JOBS Act, enacted in April 2012, and may take advantage of reduced reporting
requirements that are otherwise applicable to public companies. These provisions include, but are not limited to:

· being
permitted to present only two years of audited financial statements and only two years
of related Management’s Discussion and Analysis of Financial Condition and Results
of Operations in our filings with the SEC;

· not being
required to comply with the auditor attestation requirements in the assessment of our
internal control over financial reporting;

· reduced
disclosure obligations regarding executive compensation in periodic reports, proxy statements
and registration statements; and

· exemptions
from the requirements of holding a nonbinding advisory vote on executive compensation
and shareholder approval of any golden parachute payments not previously approved.

We may take advantage
of these provisions until the last day of our fiscal year following the fifth anniversary of the date of the first sale of our
ordinary shares pursuant to this offering. However, if certain events occur before the end of such five-year period, including
if we become a “large accelerated filer,” our annual gross revenues exceed $1.07 billion or we issue more than $1.0
billion of non-convertible debt in any three-year period, we will cease to be an emerging growth company before the end of such
five-year period.

In addition, Section
107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period
provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended, or the Securities Act, for complying with new or revised
accounting standards. We have elected to take advantage of the extended transition period for complying with new or revised accounting
standards and acknowledge such election is irrevocable pursuant to Section 107 of the JOBS Act.

We are a “foreign
private issuer,” as defined by the SEC. As a result, in accordance with the rules and regulations of The Nasdaq Stock Market
LLC, or Nasdaq, we may comply with home country governance requirements and certain exemptions thereunder rather than complying
with Nasdaq corporate governance standards. We may choose to take advantage of the following exemptions afforded to foreign private
issuers:

·

Exemption
from filing quarterly reports on Form 10-Q, from filing proxy solicitation materials
on Schedule 14A or 14C in connection with annual or special meetings of shareholders,
from providing current reports on Form 8-K disclosing significant events within four
(4) days of their occurrence, and from the disclosure requirements of Regulation FD.

· Exemption
from Section 16 rules regarding sales of ordinary shares by insiders, which will
provide less data in this regard than shareholders of U.S. companies that are subject
to the Exchange Act.

· Exemption
from the Nasdaq rules applicable to domestic issuers requiring disclosure within four
(4) business days of any determination to grant a waiver of the code of business conduct
and ethics to directors and officers. Although we will require board approval of any
such waiver, we may choose not to disclose the waiver in the manner set forth in the
Nasdaq rules, as permitted by the foreign private issuer exemption.

· Exemption
from the requirement that our board of directors have a compensation committee that is
composed entirely of independent directors with a written charter addressing the committee’s
purpose and responsibilities.

· Exemption
from the requirements that director nominees are selected, or recommended for selection
by our board of directors, either by (i) independent directors constituting a majority
of our board of directors’ independent directors in a vote in which only independent
directors participate, or (ii) a committee comprised solely of independent directors,
and that a formal written charter or board resolution, as applicable, addressing the
nominations process is adopted.

Furthermore, Nasdaq
Rule 5615(a)(3) provides that a foreign private issuer, such as us, may rely on our home country corporate governance practices
in lieu of certain of the rules in the Nasdaq Rule 5600 Series and Rule 5250(d), provided that we nevertheless comply with Nasdaq’s
Notification of Noncompliance requirement (Rule 5625), the Voting Rights requirement (Rule 5640) and that we have an audit committee
that satisfies Rule 5605(c)(3), consisting of committee members that meet the independence requirements of Rule 5605(c)(2)(A)(ii).
If we rely on our home country corporate governance practices in lieu of certain of the rules of Nasdaq, our shareholders may
not have the same protections afforded to shareholders of companies that are subject to all of the corporate governance requirements
of Nasdaq. If we choose to do so, we may utilize these exemptions for as long as we continue to qualify as a foreign private issuer.

Although we are
permitted to follow certain corporate governance rules that conform to Cayman Island requirements in lieu of many of the Nasdaq
corporate governance rules, we intend to comply with the Nasdaq corporate governance rules applicable to foreign private issuers,
including the requirement to hold annual meetings of shareholders.

Corporate Information

Our principal executive
office is located at Room 12A05, Block A, Boya International Center, Building 2, No. 1 Courtyard, Lize Zhongyi Road, Chaoyang
District, Beijing, China 100102. Our telephone number is 86-010-52411819. Our registered office in the Cayman Islands is located
at the office of Campbells Corporate Services Limited, Floor 4, Willow House, Cricket Square, Grand Cayman KY1-9010, Cayman Islands.

Our agent for service
of process in the United States is Puglisi & Associates, located at 850 Library Ave., Suite 204, Newark, DE 19711. Our website
is located at http://www.infobird.com. Information contained on, or that can be accessed through, our website is not a part of,
and shall not be incorporated by reference into, this prospectus.

The Offering(1)

Securities
being offered:
6,250,000
ordinary shares on a firm commitment basis (or 7,187,500 ordinary shares, if the underwriters exercise their over-allotment
option in full).
Initial public offering price: We estimate the
initial public offering price will be $4.00 per ordinary share.
Number of ordinary shares outstanding before
this offering:
19,000,000 ordinary
shares.
Number of ordinary shares outstanding after
this offering:

25,250,000
ordinary shares (or 26,187,500 ordinary shares if the underwriters exercise their over-allotment
option in full).

Underwriters’ over-allotment option: We have granted
the underwriters an option for a period of up to 45 days after the date of this prospectus to purchase up to 937,500 additional
ordinary shares.
Use of proceeds: We intend to use
approximately 50% of the net proceeds of this offering for strengthening sales and marketing, approximately 24% for research
and development, and the remainder for working capital and general corporate purposes, including for future capital expenditures,
such as the construction of the cloud computing facility in Guiyang, China, and increasing our liquidity, as further described
in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and elsewhere
in this prospectus. For more information on the use of proceeds, see “Use of Proceeds” on page 38.
Lock-up: All of our directors,
officers and principal shareholders (defined as owners of 5% or more of our ordinary shares) have agreed with the underwriters,
subject to certain exceptions, not to sell, transfer or dispose of, directly or indirectly, any of our ordinary shares or
securities convertible into or exercisable or exchangeable for our ordinary shares for a period of twelve (12) months after
the date of this prospectus. Certain of our other shareholders have agreed with the underwriters, subject to certain exceptions,
not to sell, transfer or dispose of, directly or indirectly, any of our ordinary shares or securities convertible into or
exercisable or exchangeable for our ordinary shares for a period of six (6) months after the date of this prospectus. See
“Shares Eligible for Future Sale” and “Underwriting” for more information.
Indemnification escrow: Net proceeds of
this offering in the amount of $600,000 shall be used to fund an escrow account for a period of twenty-four (24) months
following the closing date of this offering, which account shall be used in the event we have to indemnify the underwriters
pursuant to the terms of an underwriting agreement with the underwriters.
Representative’s warrants: Upon the closing
of this offering, we will issue to WestPark Capital, Inc., as representative of the underwriters, the representative’s
warrants entitling the representative to purchase 10% of the aggregate number of ordinary shares issued in this offering,
exclusive of the underwriters’ over-allotment option. The representative’s warrants, once issued, will be exercisable
for a period of five years from the effective date of the registration statement of which this prospectus forms a part and
may be exercised on a cash or cashless basis.
Nasdaq symbol: Our ordinary
shares have been approved for listing on the Nasdaq Capital Market under
the symbol “IFBD”.
Risk factors: Investing in
our ordinary shares is highly speculative and involves a high degree of risk.
As an investor you should be able to bear
a complete loss of your investment. You should carefully consider the information set forth in the “Risk Factors”
section beginning on page 10.

(1)
Unless otherwise indicated, all information contained in this prospectus assumes no exercise
of the underwriters’ over-allotment option or the representative’s warrants
and is based on 19,000,000 ordinary shares outstanding as of June 30, 2020 and as of
the date of this prospectus.

Summary Consolidated Financial Data

The following tables
summarize our consolidated financial data for the periods and as of the dates indicated. The summary consolidated statements of
income and comprehensive income for the six months ended June 30, 2020 and 2019 and for the years ended December 31, 2019
and 2018 and the summary consolidated balance sheet data as of June 30, 2020, December 31, 2019 and 2018 are derived from our
consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the
United States of America, or U.S. GAAP, and included elsewhere in this prospectus. Our historical results are not necessarily
indicative of the results that may be expected in the future, and the results for any interim period are not necessarily indicative
of the results that may be expected for a full year. The following summary consolidated financial data should be read in conjunction
with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Exchange
Rate Information” and our consolidated financial statements included elsewhere in this prospectus.

For the Six Months Ended
June 30,
For the Years Ended
December 31,
2020 2019 2019 2018
$ $ $ $
(Unaudited) (Unaudited)
Consolidated Statements of Income and Comprehensive Income:
Revenues 6,232,741 9,356,638 18,248,289 18,789,550
Cost of revenues 2,165,643 4,556,874 7,987,146 9,303,803
Gross profit 4,067,098 4,799,764 10,261,143 9,485,747
Operating expenses 2,315,061 2,503,060 4,222,263 6,418,079
Income from operations 1,752,037 2,296,704 6,038,880 3,067,668
Other expense, net 69,678 247,016 264,018 480,030
Provision for income taxes 109,818 95,261 673,034 145,263
Net income 1,572,541 1,954,427 5,101,828 2,442,375
Earnings per share, basic and diluted 0.08 0.10 0.26 0.14
Weighted average number of ordinary shares outstanding* 19,000,000 19,000,000 19,000,000 19,000,000

* Shares and per share data are presented
on a retroactive basis to reflect the nominal share issuance on March 26, 2020.

June 30,
2020
December 31,
2019
December 31,
2018
$ $ $
(Unaudited)
Consolidated Balance Sheet Data:
Current assets 6,115,689 5,944,254 6,608,143
Total assets 12,013,367 11,139,226 10,369,927
Current liabilities 6,645,631 7,343,064 10,003,872
Total liabilities 6,906,145 7,544,671 10,058,604
Total equity 5,107,222 3,594,555 311,323

RISK FACTORS

An investment
in our ordinary shares involves a high degree of risk. You should carefully consider the following information about these risks,
together with the other information appearing elsewhere in this prospectus, before deciding to invest in our ordinary shares.
The occurrence of any of the following risks could have a material adverse effect on our business, financial condition, results
of operations and future growth prospects. In these circumstances, the market price of our ordinary shares could decline, and
you may lose all or part of your investment.

Risks Related to Our Business and
Industry

We have a limited
operating history. There is no assurance that our future operations will be profitable. If we cannot generate sufficient revenues
to operate profitably, we may suspend or cease operations.

Given the limited
operating history of Infobird Cayman, there can be no assurance that we can maintain our business such that we can continuously
earn a significant profit or any profit at all. The future of our business will depend upon our ability to obtain and retain customers
and when needed, obtain sufficient financing and support from creditors, while we strive to achieve and maintain profitable operations.
The likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered
in connection with the operations that we undertake. There is no history upon which to base any assumption that our business will
prove to be successful, and there is significant risk that we will not be able to generate the sales volumes and revenues necessary
to achieve profitable operations. To the extent that we cannot achieve our plans and generate revenues which exceed expenses on
a consistent basis, our business, results of operations, financial condition and prospects will be materially adversely affected.

Our management team
has limited public company experience. We have never operated as a public company in the United States and several of our senior
management positions are currently held by employees who have been with us for a short period of time. Our entire management team,
as well as other company personnel, will need to devote substantial time to compliance, and may not effectively or efficiently
manage our transition into a public company. If we are unable to effectively comply with the regulations applicable to public
companies or if we are unable to produce accurate and timely financial statements, which may result in material misstatements
in our consolidated financial statements or possible restatement of financial results, our stock price may be materially and adversely
affected, and we may be unable to maintain compliance with the listing requirements of Nasdaq. Any such failures could also result
in litigation or regulatory actions by the SEC or other regulatory authorities, loss of investor confidence, delisting of our
securities, harm to our reputation and diversion of financial and management resources from the operation of our business, any
of which could materially and adversely affect our business, financial condition, results of operations and growth prospects.
Additionally, the failure of a key employee to perform in his or her current position could result in our inability to continue
to grow our business or to implement our business strategy.

The growth
and success of our business depends on our ability to develop new services and enhance existing services in order to keep pace
with rapid changes in technology.

The market for our
services is characterized by rapid technological change, evolving industry standards, changing customer preferences and new product
and service introductions. Our future growth and success depends significantly on our ability to anticipate developments in technologies,
and develop and offer new services to meet our customers’ evolving needs. We may not be successful in anticipating or responding
to these developments in a timely manner, or if we do respond, the services or technologies we develop may not be successful in
the marketplace. The development of some of the services and technologies may involve significant upfront investments and the
failure of these services and technologies may result in our being unable to recover these investments, in part or in full. Further,
services or technologies that are developed by our competitors may render our services uncompetitive or obsolete. In addition,
new technologies may be developed that allow our customers to more cost-effectively perform the services that we provide, thereby
reducing demand for our services. Should we fail to adapt to the rapidly changing technologies or if we fail to develop suitable
services to meet the evolving and increasingly sophisticated requirements of our customers in a timely manner, our business and
results of operations may be materially and adversely affected.

We may be forced
to reduce the prices of our services due to increased competition and reduced bargaining power with our customers, which could
lead to reduced revenues and profitability.

The customer engagement
industry in China is developing rapidly and related technology trends are constantly evolving. This results in the frequent introduction
of new services and significant price competition from our competitors. We may be unable to offset the effect of declining average
sales prices through increased sales volumes and or reductions in our costs. Furthermore, we may be forced to reduce the prices
of our services in response to offerings made by our competitors. Finally, we may not have the same level of bargaining power
we have enjoyed in the past when it comes to negotiating for the prices of our services, all of which may lead to reduced revenues
and profitability.

We generate
a significant portion of our revenues primarily from a single major customer, China Guangfa Bank, which accounted for 75.5% and
77.3% of our total revenues for the six months ended June 30, 2020 and for the year ended December 31, 2019, respectively, and
loss of business from such customer could reduce our revenues and significantly harm our business.

We generate a significant
portion of our revenues primarily from a single major customer, China Guangfa Bank, and loss of business from such customer could
reduce our revenues and significantly harm our business. We believe that in the foreseeable future we will continue to derive
a significant portion of our revenues from a small number of major customers.

For the six months
ended June 30, 2020 and 2019, one customer, China Guangfa Bank, accounted for 75.5% and 81.0% of our total revenues, respectively,
and as of June 30, 2020, the same one customer, China Guangfa Bank, accounted for 91.5% of the total balance of our accounts receivable.
For the year ended December 31, 2019, one customer, China Guangfa Bank, accounted for 77.3% of our total revenues and the same
one customer, China Guangfa Bank, accounted for 77.6% and another customer accounted for 10.4%, respectively, of the total balance
of our accounts receivable. For the year ended December 31, 2018, one customer, China Guangfa Bank, accounted for 76.7% of our
total revenues and the same one customer, China Guangfa Bank, accounted for 88.4% of the total balance of our accounts receivable.
The decline in customized cloud-based services revenue, which is attributed to China Guangfa Bank, for the six months ended June
30, 2020 was due to the impact of COVID-19. Aside from the impact of COVID-19, China Guangfa Bank also changed its internal strategy
of telemarketing, which resulted in a decrease in the number of paid user accounts subscribed by China Guangfa Bank in the second
half of 2020 as compared to prior periods. Due to the impact of COVID-19 and China Guangfa Bank’s change in internal strategy
of telemarketing, our customized cloud-based services revenue in the fiscal year 2020 will be lower compared to the fiscal year
2019. We expect such revenue to continue declining in the fiscal year 2021 mainly due to China Guangfa Bank’s decrease in
its demand for, and usage of, our corresponding products and services. Currently, China Guangfa Bank’s internal telemarketing
strategy is to increase its internal IT capabilities. Therefore, China Guangfa Bank no longer procures such services from a third-party
provider, including us, which affects the services we provide to China Guangfa Bank. Due to our long-lasting relationship with
China Guangfa Bank, we have been actively communicating with China Guangfa Bank to explore cooperative opportunities involving
our standard cloud-based services in other business lines. In addition, our latest services contract with China Guangfa Bank was
effective on April 1, 2019 for a service period of fifteen months and expired on June 30, 2020. The termination of the latest
contract required mutual written consent from us and China Guangfa Bank. We were to provide China Guangfa Bank access to the customized
SaaS, which included telecommunications services, such as telephone calls and messaging, and technical support. China Guangfa
Bank has not renewed such agreement, and we and China Guangfa Bank are currently not operating under such agreement. In addition,
we entered into a separate services contract with China Guangfa Bank for the provision of data analysis and research services.
The contract had a three-year term from January 1, 2018 and expired on December 31, 2020. China Guangfa Bank could terminate this
contract at any time. China Guangfa Bank has not renewed such agreement, and we and China Guangfa Bank are currently not operating
under such agreement. We do not derive material amounts of revenue from such expired telecommunications services agreement with
China Guangfa Bank. We are negotiating with China Guangfa Bank to provide new products and services to China Guangfa Bank. It
is currently preliminarily anticipated that China Guangfa Bank will account for less than 5%, approximately 30% and approximately
5% of the Company’s total revenues for the second half of the 2020 fiscal year, the full 2020 fiscal year and the full 2021
fiscal year, respectively.

Our ability to maintain
close relationships with major customers, specifically China Guangfa Bank, is essential to the growth and profitability of our
business. However, the volume of work performed for a specific customer is likely to vary from year to year, in particular since
we are generally not our customers’ exclusive technology services provider and we do not have long-term commitments from
any of our customers to purchase our services. A major customer in one year may not provide the same level of revenues for us
in any subsequent year. The services we provide to our customers, and the revenues and income from those services, may decline
or vary as the type and quantity of services we provide changes over time. In addition, our reliance on any individual customer
for a significant portion of our revenues may give that customer a certain degree of pricing leverage against us when negotiating
contracts and terms of service. In addition, a number of factors other than our performance could cause the loss of or reduction
in business or revenues from a customer, and these factors are not predictable. These factors may include organization restructuring,
pricing pressure, changes to its technology strategy, switching to another services provider or returning work in-house. The loss
of any of our major customers could adversely affect our financial condition and results of operations.

We primarily
rely on a limited number of vendors, and the loss of any such vendor could harm our business.

For the six months
ended June 30, 2020, two vendors accounted for 11.8% and 11.4%, respectively, of our total purchases, and also accounted for 37.5%
and 11.0%, respectively, of the total balance of our accounts payable. For the year ended December 31, 2019, three vendors accounted
for 16.0%, 13.1% and 10.3%, respectively, of our total purchases, and also accounted for 18.6%, 12.9% and 12.3%, respectively,
of the total balance of our accounts payable. For the year ended December 31, 2018, three vendors accounted for 21.6%, 12.4% and
11.2%, respectively, of our total purchases, and also accounted for 27.3%, 23.8% and 12.5%, respectively, of the total balance
of our accounts payable. Such vendors are telecommunications carriers and our purchases from such vendors are value-added telecommunications
services, such as voice lines and research services. We enter into agreements with vendors in the ordinary course of our business.
Such agreements generally have initial terms ranging from two to three years and typically contain automatic renewal provisions.
Any difficulty in replacing such vendors could negatively affect our performance. If we are prevented or delayed in obtaining
services, products, or components for products, due to political, civil, labor or other factors beyond our control that affect
our vendors, including natural disasters or pandemics, our operations may be substantially disrupted, potentially for a significant
period of time. Such delays may significantly reduce our revenues and profitability and harm our business while alternative sources
of supply are secured.

We operate
in highly competitive markets and the size and resources of many of our competitors may allow them to compete more effectively
than we can, preventing us from achieving profitability.

The markets we compete
in are highly competitive. Competition may result in pricing pressures, reduced profit margins or lost market share, or a failure
to grow our market share, any of which could substantially harm its business and results of operations. We compete for customers
primarily on the basis of our brand name, price and the range of products and services that we offer. Across our business, we
face competitors who are constantly seeking ideas which will appeal to customers and introducing new products that compete with
our products. Many of our competitors have significant competitive advantages, including longer operating histories, larger and
broader customer bases, less-costly production, more established relationships with a broader set of suppliers and customers,
greater brand recognition and greater financial, research and development, marketing, distribution and other resources than we
do. We cannot assure that we will be able to successfully compete against new or existing competitors. If we fail to maintain
our reputation and competitiveness, customers demand for our products may decline.

In addition to existing
competitors, new participants with a popular product or service idea could gain access to customers and become a significant source
of competition in a short period of time. These existing and new competitors may be able to respond more rapidly than us to changes
in customer preferences. Our competitors’ products may achieve greater market acceptance than our products and potentially
reduce demand for our products, lower our revenues and lower our profitability.

Our future
growth depends in part on new products and new technology innovation, and failure to invent and innovate could materially and
adversely impact our business prospects.

Our future growth
depends in part on maintaining our current products in new and existing markets, as well as our ability to develop new products
and technologies to serve such markets. To the extent that competitors develop competitive products and technologies, or new products
or technologies that achieve higher customer satisfaction, our business prospects may be materially and adversely impacted. In
addition, regulatory approvals for new products or technologies may be required, these approvals may not be obtained in a timely
or cost effective manner, which may also materially and adversely impact our business prospects.

If we fail to increase our brand
recognition, we may face difficulty in obtaining new customers.

Although we believe
our brand is reputable in the PRC customer engagement industry, we still believe that maintaining and enhancing our brand recognition
in a cost-effective manner outside of that market is critical to achieving widespread acceptance of our current and future products
and services and is an important element in our effort to increase our customer base. Successful promotion of our brand will depend
largely on our ability to maintain a sizeable and active customer base, our marketing efforts and ability to provide reliable
and useful products and services at competitive prices. Brand promotion activities may not yield increased revenue, and even if
they do, any increased revenue may not offset the expenses we will incur in building our brand. If we fail to successfully promote
and maintain our brand, or if we incur substantial expenses in an unsuccessful attempt to promote and maintain our brand, we may
fail to attract enough new customers or retain our existing customers to the extent necessary to realize a sufficient return on
our brand-building efforts, in which case our business, operating results and financial condition, would be materially and adversely
affected.

Any failure
to offer high-quality customer support may materially and adversely affect our relationships with our customers.

Our ability to retain
existing customers and attract new customers depends on our ability to maintain a consistently high level of customer service
and technical support. Our customers depend on our service support team to assist them in utilizing our services effectively and
to help them to resolve issues quickly and to provide ongoing support. If we are unable to hire and train sufficient support resources
or are otherwise unsuccessful in assisting our customers effectively, it may materially and adversely affect our ability to retain
existing customers and could prevent prospective customers from adopting to our services. We may be unable to respond quickly
enough to accommodate short-term increases in demand for customer support. We also may be unable to modify the nature, scope and
delivery of our customer support to compete with changes in the support services provided by our competitors. Increased demand
for customer support, without corresponding revenue, could increase our costs and adversely affect our business, results of operations
and financial condition. Our sales are highly dependent on our business reputation and on positive recommendations from customers.
Any failure to maintain high-quality customer support, or a market perception that we do not maintain high-quality customer support,
may materially and adversely affect our reputation, business, results of operations and financial condition.

Incorrect or
improper implementation or use of our services could result in customer dissatisfaction and negatively affect our business, results
of operations, financial condition, and growth prospects.

Our services are
deployed in a wide variety of increasingly complex technology environments, including on premises, in the cloud or in hybrid environments.
We believe our future success will depend on our ability to increase sales of our services for use in such deployments. We must
often assist our customers in achieving successful implementations of our services, which we do through our professional consulting
and technical support services. If our customers are unable to implement our services successfully, or unable to do so in a timely
manner, customer perceptions of our services may be harmed, our reputation and brand may suffer, and customers may choose to cease
usage of our services or not to expand their use of our services. Our customers may need training in the proper use of and the
variety of benefits that can be derived from our services to maximize their benefits. If our services are not effectively implemented
or used correctly or as intended, or if we fail to adequately train customers on how to efficiently and effectively use our services,
our customers may not be able to achieve satisfactory outcomes. This could result in negative publicity and legal claims against
us, which may cause us to generate fewer sales to new customers and reductions in renewals or expansions of the use of our services
with existing customers, any of which would harm our business and results of operations.

Failure to
adhere to regulations that govern our customers’ businesses could result in breaches of contracts with our customers. Failure
to adhere to the regulations that govern our business could result in our being unable to effectively perform our services.

Our customers’
business operations are subject to certain rules and regulations in China or elsewhere. Our customers may contractually require
that we perform our services in a manner that would enable them to comply with such rules and regulations. Failure to perform
our services in such manner could result in breaches of contract with our customers and, in some limited circumstances, civil
fines and criminal penalties for us.

In addition, the
internet industry in China is highly regulated, and we are required under various Chinese laws to obtain and maintain permits
and licenses to conduct our business.

Pursuant to the PRC
Regulations on Telecommunications, in order to engage in value-added telecommunications services, or VATS, a services provider
must obtain a value-added telecommunications business operating license, or VATS License, from the MIIT or its provincial level
counterparts. For example, pursuant to the Catalogue of Telecommunications Business, the call center business refers to the provision
of business consultation, information consultation and data query services to users, with the entrustment of enterprises or institutions,
based on the call center system and database technology connected to public communication network or the internet and the information
database established by information collection, processing and storage. Therefore, a VATS License with the business scope of “Nationwide
Domestic Call Center Services” is required for the provision of call center services all over China. As of December 31,
2020, Infobird Guiyang has obtained a VATS License with the business scope of “Domestic Call Center Services in Guizhou
Province only” while a broader scope covering national service is required. In addition, Infobird Beijing has obtained a
VATS License with the business scope of “Nationwide Domestic Call Center Services”. We are currently in the process
of switching the counterparty on our relevant existing agreements with customers from Infobird Guiyang to Infobird Beijing in
order to be compliant with such restrictions. If the relevant PRC government authority decides that we are operating without the
proper license, we may be subject to penalties such as confiscation of the revenues that were generated through the unlicensed
activities, the imposition of fines and the discontinuation of our operations.

As of December 31, 2020, we have not been
subject to any material penalties from the relevant government authorities for failure to obtain any license for our business
operations in the past. We cannot assure you, however, that the government authorities will not do so in the future. If we do
not obtain, hold or maintain our licenses or other qualifications to provide our services, we may not be able to provide services
to existing customers or be able to attract new customers and could lose revenues, and we may also be subject to penalties, which
could have a material and adverse effect on our business and results of operations.

Failure to
disclose the outsourcing of our BPO services to customers or reach an agreement on the outsourcing with customers could result
in breaches and terminations of contracts with our customers, and may substantially harm our business and results of operations.

We provide BPO services
partially through outsourced service providers, in which event the BPO services are actually provided by the outsourced service
providers to our customers. However, we do not disclose the outsourcing to our customers, nor do we reach an agreement with our
customers on the outsourcing in the BPO services contracts signed between our customers and us. Such failure could result in breaches
and terminations of BPO services contracts, and we may also be subject to liabilities for breach of contracts, which may have
a material adverse effect on our business and results of operations.

If our new
enhancements to our services do not achieve sufficient market acceptance, our financial results and competitive position will
suffer.

We spend substantial
amounts of time and money to research and develop new enhancements of our services to incorporate additional features, improve
functionality or other enhancements in order to meet our customers’ rapidly evolving demands. When we develop an enhancement
to our services, we typically incur expenses and expend resources upfront to develop, market and promote the new enhancements.
Therefore, when we develop and introduce new enhancements to our services, they must achieve high levels of market acceptance
in order to justify the amount of our investment in developing and bringing them to market. If our new enhancements to our services
do not garner widespread market adoption and implementations, our business, business prospects, future financial results and competitive
position may be materially and adversely affected.

If we cause
disruptions to our customers’ businesses or provide inadequate service, our customers may have claims for substantial damages
against us, and as a result our profits may be substantially reduced.

If we make errors
in the course of delivering services to our customers or fail to consistently meet service requirements of a customer, these errors
or failures could disrupt the customer’s business, which could result in a reduction in our net revenues or a claim for
substantial damages against us. In addition, a failure or inability to meet a contractual requirement could seriously damage our
reputation and affect our ability to attract new business.

The services we provide
are often critical to our customers’ businesses. We generally provide customer support after our customized application
is delivered. Certain of our customer contracts require us to comply with security obligations including maintaining system security,
ensuring our system is virus-free, maintaining business continuity procedures, and verifying the integrity of employees that work
with our customers by conducting background checks. Any failure in a customer’s system or breach of security relating to
the services we provide to the customer could damage our reputation or result in a claim for substantial damages against us. Any
significant failure of our systems could impede our ability to provide services to our customers, have a negative impact on our
reputation, which may materially and adversely affect our business, financial conditional and results of operations.

Interruptions
or performance problems associated with our technology and infrastructure may materially and adversely affect our business, results
of operations, and financial condition.

Our continued growth
depends in part on the ability of our existing customers and new customers to access our SaaS services, at any time and within
an acceptable amount of time. We may in the future experience, service disruptions, outages and other performance problems due
to a variety of factors, including infrastructure changes, human or software errors or capacity constraints. In some instances,
we may not be able to identify the cause or causes of these performance problems within an acceptable period of time. It may become
increasingly difficult to maintain and improve our performance as our SaaS services become more complex. If our services are unavailable
or if our customers are unable to access features of our services within a reasonable amount of time or at all, our business,
results of operations, and financial condition may be materially and adversely affected would be negatively affected.

We currently provide
our SaaS services via designated data centers. We expect that in the future we may experience interruptions, delays and outages
in service and availability from time to time due to a variety of factors, including infrastructure changes, human or software
errors, website hosting disruptions and capacity constraints. Capacity constraints could be due to a number of potential causes
including technical failures, natural disasters, fraud or security attacks. In addition, if our security, or that of our data
center providers, is compromised, our services are unavailable or our customers are unable to use our services within a reasonable
amount of time or at all, then our business, results of operations and financial condition may be materially and adversely affected.
In some instances, we expect that we may not be able to identify the cause or causes of these performance problems within a period
of time acceptable to our customers. It may become increasingly difficult to maintain and improve our service performance, in
particular during peak usage times, as the features of our services become more complex and the usage of our services increases.
Any of the above circumstances or events may harm our reputation, cause customers to stop using our services, or impair our ability
to increase revenue from existing customers, impair our ability to grow our customer base, our business, results of operations,
and financial condition may be materially and adversely affected.

Unauthorized
disclosure, destruction or modification of data, through cybersecurity breaches, computer viruses or otherwise or disruption of
our services could expose us to liability, protracted and costly litigation and damage our reputation.

Our business involves
the collection, storage, processing and transmission of customers’ business data. An increasing number of organizations,
including large merchants and businesses, other large technology companies, financial institutions and government institutions,
have disclosed breaches of their information technology systems, some of which have involved sophisticated and highly targeted
cybersecurity attacks, including on portions of their websites or infrastructure. We may also be subjected to breaches of cybersecurity
by hackers. Threats may derive from human error, fraud or malice on the part of employees or third parties, or may result from
accidental technological failure. Concerns about cybersecurity are increased when we transmit information. Electronic transmissions
can also be subjected to cybersecurity attacks, interception or loss. Also, computer viruses and malware can be distributed and
spread rapidly over the internet and could infiltrate our systems or those of our associated participants, which can impact the
confidentiality, integrity and availability of information, and the integrity and availability of our products, services and systems,
among other effects. Denial of service or other cybersecurity attacks could be targeted against us for a variety of purposes,
including interfering with our products and services or creating a diversion for other malicious activities. These types of actions
and attacks could disrupt our delivery of products and services or make them unavailable, which could damage our reputation, force
us to incur significant expenses in remediating the resulting impacts, expose us to uninsured liabilities, subject us to lawsuits,
fines or sanctions, distract our management or increase our costs of doing business.

Our encryption of
data and other protective measures may not prevent unauthorized access or use of sensitive data. A breach of our system or that
of one of our associated participants may subject us to material losses or liability. A misuse of such data or a cybersecurity
breach could harm our reputation and deter customers from using our products and services, thus reducing our revenue. In addition,
any such misuse or breach could cause us to incur costs to correct the breaches or failures, expose us to uninsured liabilities,
increase our risk of regulatory scrutiny, subject us to lawsuits, result in the imposition of material penalties and fines under
applying laws or regulations.

We cannot assure
that there are written agreements in place with every associated participant or that such written agreements will prevent the
unauthorized use, modification, destruction or disclosure of data or enable us or our customers to obtain reimbursement in the
event we should suffer incidents resulting in unauthorized use, modification, destruction or disclosure of data. Any unauthorized
use, modification, destruction or disclosure of data could result in protracted and costly litigation, which could have a material
and adverse effect on our business, financial condition and results of operations.

Cybersecurity attack
incidents are increasing in frequency and evolving in nature and include, but are not limited to, installation of malicious software,
unauthorized access to data and other electronic security breaches that could lead to disruptions in systems, unauthorized release
of confidential or otherwise protected information and the corruption of data. Given the unpredictability of the timing, nature
and scope of information technology disruptions, there can be no assurance that the procedures and controls we employ will be
sufficient to prevent security breaches from occurring and we could be subject to manipulation or improper use of our systems
and networks or financial losses from remedial actions, any of which could have a material and adverse effect on our business,
financial condition and results of operations.

The PRC Cyber Security
Law, effective on June 1, 2017, stipulates that a network operator must adopt technical measures and other necessary measures
in accordance with applicable laws and regulations as well as compulsory national and industrial standards to safeguard the safety
and stability of network operations, effectively respond to network security incidents, prevent illegal and criminal activities,
maintain the integrity, confidentiality and availability of network data. We are making efforts to comply with the applicable
laws, regulations and standards, but there can be no assurance that our measures will be effective and sufficient under the PRC
Cyber Security Law. If we were found by the regulatory authorities to have failed to comply with the PRC Cyber Security Law, we
would be subject to warning, fines, confiscation of illegal revenue, revocation of licenses, cancellation of filings, shutdown
of our platform or even criminal liability and our business, results of operations and financial condition would also be adversely
affected. In addition, in light of the evolving regulatory framework of China for the protection of information in cyberspace,
we may be subject to uncertainties of and adjustments to our business practices, which may incur additional operating expenses
and adversely affect our results of operations and financial condition.

We face intense
competition from onshore and offshore customer engagement service providers, and, if we are unable to compete effectively, we
may lose customers and our revenues may decline.

The market for customer
engagement services is highly competitive and we expect competition to persist and intensify. We believe that the principal competitive
factors in our markets are industry expertise, breadth and depth of service offerings, quality of the services offered, reputation
and track record, marketing and selling skills, scalability of technology infrastructure and price. In the customer engagement
market, customers tend to engage multiple service providers instead of using an exclusive service provider, which could reduce
our revenues to the extent that customers obtain similar or substituted services from other competing providers. Our ability to
compete also depends in part on a number of factors beyond our control, including the ability of our competitors to recruit, train,
develop and retain highly skilled employees, in particular research and development employees, the price at which our competitors
offer comparable services and our competitors’ responsiveness to customer needs and market trends. Therefore, we cannot
assure you that we will be able to retain our customers while competing against such competitors. Increased competition, our inability
to compete successfully against competitors, pricing pressures or loss of market share may materially and adversely affect our
business, financial condition and results of operations.

We have engaged
in transactions with related parties, and such transactions present possible conflicts of interest that could have a material
and adverse effect on our business, financial condition and results of operations.

We have entered into
a number of transactions with related parties. See “Certain Relationships and Related Party Transactions” for further
details on related party transactions. We may in the future enter into additional transactions with entities in which members
of our board of directors and other related parties hold ownership interests.

Transactions with
related parties present potential for conflicts of interest, as the interests of related parties may not align with the interests
of our shareholders. Although we believe that these transactions were in our best interests, we cannot assure you that these transactions
were entered into on terms as favorable to us as those that could have been obtained in an arms-length transaction. We may also
engage in transactions with related parties in the future. Conflicts of interests may arise when we transact business with related
parties. These transactions, individually or in the aggregate, may have a material and adverse effect on our business, financial
condition and results of operations or may result in litigation.

Changes in
demand for our products and business relationships with key customers and vendors may materially and adversely affect operating
results.

To achieve our objectives,
we must develop and sell products that are subject to the demands of our customers. This is dependent on several factors, including
managing and maintaining relationships with key customers, responding to the rapid pace of technological change and obsolescence,
which may require increased investment by us or result in greater pressure to commercialize developments rapidly or at prices
that may not fully recover the associated investment, and the effect on demand resulting from customers’ research and development,
capital expenditure plans and capacity utilization. If we are unable to keep up with our customers’ demands, our sales,
earnings and operating results may be materially and adversely affected.

Our future
success depends in part on our ability to retain key executives and to attract, retain and motivate qualified personnel.

We are highly dependent
on the principal members of our executive team listed in the section entitled “Management” located elsewhere in this
prospectus, the loss of whose services may materially and adversely impact the achievement of our objectives. Recruiting and retaining
other qualified employees for our business, including technical personnel, will also be critical to our success. Competition for
skilled personnel is intense and the turnover rate can be high. We may not be able to attract and retain personnel on acceptable
terms given the competition among numerous companies for individuals with similar skill sets. The inability to recruit or loss
of the services of any executive or key employee may materially and adversely affect our business.

We may need
to expand our organization, and we may experience difficulties in managing this growth, which could disrupt our operations.

As of December 31,
2020, we had 305 employees, all of whom were full-time employees and were located in China. As our company continues to grow,
we also expect to expand our employee base. In addition, we intend to grow by expanding our business, increasing market penetration
of our existing products and developing new products. Future growth would impose significant additional responsibilities on our
management, including the need to develop and improve our existing administrative and operational systems and our financial and
management controls and to identify, recruit, maintain, motivate, train, manage and integrate additional employees, consultants
and contractors. Also, our management may need to divert a disproportionate amount of its attention away from our day-to-day activities
and devote a substantial amount of time to managing these growth activities. We may not be able to effectively manage the expansion
of our operations, which may result in weaknesses in our infrastructure, give rise to operational mistakes, loss of business opportunities,
loss of employees and reduced productivity among remaining employees. Future growth could require significant capital expenditures
and may divert financial resources from other projects, such as the development of our existing or future product candidates.
If our management is unable to effectively manage our growth, our expenses may increase more than expected, our ability to generate
and grow revenue could be reduced, and we may not be able to implement our business strategy. Our future financial performance
and our ability to compete effectively will depend, in part, on our ability to effectively manage any future growth.

Failure of
beneficial owners of our shares who are PRC residents to comply with certain PRC foreign exchange regulations could restrict our
ability to distribute profits, restrict our overseas and cross-border investment activities and subject us to liability under
PRC law.

The State Administration
of Foreign Exchange, or SAFE, has promulgated regulations, including the Notice on Relevant Issues Relating to Foreign Exchange
Control on Domestic Residents’ Investment and Financing and Round-Trip Investment through Special Purpose Vehicles, or SAFE Circular
37, and its appendices. These regulations require PRC residents, including PRC institutions and individuals, to register with
local branches of SAFE in connection with their direct establishment or indirect control of an offshore entity, for the purpose
of overseas investment and financing, with such PRC residents’ legally owned assets or equity interests in domestic enterprises
or offshore assets or interests, referred to in SAFE Circular 37 as a « special purpose vehicle », or SPV. The term « control »
under SAFE Circular 37 is broadly defined as the operation rights, beneficiary rights or decision-making rights acquired by the
PRC residents in the offshore SPVs by such means as acquisition, trust, proxy, voting rights, repurchase, convertible bonds or
other arrangements. SAFE Circular 37 further requires amendment to the registration in the event of any significant changes with
respect to the SPV, such as increase or decrease of capital contributed by PRC individuals, share transfer or exchange, merger,
division or other material event. In the event that a PRC shareholder holding interests in a SPV fails to fulfill the required
SAFE registration, the PRC subsidiaries of that SPV may be prohibited from making profit distributions to the offshore parent
and from carrying out subsequent cross-border foreign exchange activities, and the SPV may be restricted in its ability to contribute
additional capital into its PRC subsidiaries. Further, failure to comply with the various SAFE registration requirements described
above could result in liability under PRC law for foreign exchange evasion.

These regulations
apply to our direct and indirect shareholders who are PRC residents and may apply to any offshore acquisitions or share transfers
that we make in the future if our shares are issued to PRC residents. However, in practice, different local SAFE branches may
have different views and procedures on the application and implementation of SAFE regulations, and there remains uncertainty with
respect to its implementation. We cannot assure you that these direct or indirect shareholders of our company who are PRC residents
will be able to successfully update the registration of their direct and indirect equity interest as required in the future. If
they fail to update the registration, our PRC subsidiaries could be subject to fines and legal penalties, and SAFE could restrict
our cross-border investment activities and our foreign exchange activities, including restricting our PRC subsidiaries’
ability to distribute dividends to, or obtain loans denominated in foreign currencies from, our company, or prevent us from contributing
additional capital into our PRC subsidiaries. As a result, our business operations and our ability to make distributions to you
could be materially and adversely affected. In addition, non-U.S. shareholders may experience unfavorable tax consequences if
such non-U.S. shareholders are determined to be a resident enterprise for PRC tax purposes. See “Regulations – Regulations
on Tax in the PRC” and “Material Income Tax Considerations – PRC Taxation” for further information.

As of the date of this
prospectus, to our knowledge, all of our shareholders had registered according to SAFE Circular 37.

Failure to
make adequate contributions to various employee benefits plans as required by PRC regulations may subject us to penalties.

Companies operating
in China are required to participate in various government sponsored employee benefit plans, including certain social insurance,
housing funds and other welfare-oriented payment obligations, and contribute to the plans in amounts equal to certain percentages
of salaries, including bonuses and allowances, of employees up to a maximum amount specified by the local government from time
to time at locations where they operate their businesses. The requirement of employee benefit plans has not been implemented consistently
by the local governments in China given the different levels of economic development in different locations. As of December 31,
2020, we have not made adequate employee benefit payments in strict compliance with the relevant PRC regulations for and on behalf
of our employees. Our failure in making contributions to various employee benefits plans in strict compliance with applicable
PRC labor-related laws and regulations may subject us to late payment penalties, and we could also be required to make up the
contributions for these plans as well as to pay late fees and fines. If we are subject to late fees or fines in relation to the
underpaid employee benefits, our financial condition and results of operations may be adversely affected.

We do not have
business insurance coverage. Any future business liability, disruption or litigation we experience might divert management focus
from our business and could significantly impact our financial results.

Availability of business
insurance products and coverage in China is limited, and most such products are expensive in relation to the coverage offered.
We have determined that the risks of disruption, cost of such insurance and the difficulties associated with acquiring such insurances
on commercially reasonable terms make it impractical for us to maintain such insurance. As a result, we do not have any business
liability, disruption or litigation insurance coverage for our operations in China. Accordingly, a business disruption, litigation
or natural disaster may result in substantial costs and divert management’s attention from our business, which would have
an adverse effect on our results of operations and financial condition.

We may require
additional financing in the future and our operations could be curtailed if we are unable to obtain required additional financing
when needed.

In addition to the
proceeds to be raised in this offering, we may need to obtain additional debt or equity financing to fund future capital expenditures.
While we do not anticipate seeking additional financing in the immediate future, any additional equity financing may result in
dilution to the holders of our outstanding ordinary shares. Additional debt financing may impose affirmative and negative covenants
that restrict our freedom to operate our business. We cannot guaranty that we will be able to raise proceeds in this offering
or obtain additional financing on terms that are acceptable to us, or any financing at all, and the failure to obtain sufficient
financing could materially and adversely affect our business operations.

We are subject
to risks relating to our leased properties, which in turn could materially and adversely affect our business, results of operations
and financial condition.

Currently, all of
our offices are located on leased premises. As of December 31, 2020, some of the lessors of our leased properties in China have
not provided us with their property ownership certificates. If our lessors are not the owners of the properties, or if they have
not obtained the proper authorization from the legal owners of the properties, our leases could be invalidated. If this occurs,
we may have to renegotiate the leases with the owners or other parties who have the right to lease the properties, and the terms
of the new leases may be less favorable to us. Although we may seek damages from such lessors, such leases may be void and we
may be forced to relocate. Any relocation would require us to locate and secure additional facilities, expenditures of additional
funds in connection with the relocation and preparation of replacement facilities. This could affect our ability to provide uninterrupted
services to our customers and harm our reputation, which in turn could materially and adversely affect our business, results of
operations and financial condition.

Risks Related to Intellectual Property

If we are not
able to adequately protect our proprietary intellectual property and information, and protect against third party claims that
we are infringing on their intellectual property rights, our results of operations could be adversely affected.

The value of our
business depends in part on our ability to protect our intellectual property and information, including our patents, copyrights,
trademarks, trade secrets, and rights under agreements with third parties, in China and around the world, as well as our customer,
employee, and customer data. Third parties may try to challenge our ownership of our intellectual property in China and around
the world. In addition, intellectual property rights and protections in China may be insufficient to protect material intellectual
property rights in China. Further, our business is subject to the risk of third parties counterfeiting our products or infringing
on our intellectual property rights. The steps we have taken may not prevent unauthorized use of our intellectual property. We
may need to resort to litigation to protect our intellectual property rights, which could result in substantial costs and diversion
of resources. If we fail to protect our proprietary intellectual property and information, including with respect to any successful
challenge to our ownership of intellectual property or material infringements of our intellectual property, this failure could
have a significant adverse effect on our business, financial condition, and results of operations.

If we are unable
to adequately protect our intellectual property rights, or if we are accused of infringing on the intellectual property rights
of others, our competitive position could be harmed or we could be required to incur significant expenses to enforce or defend
our rights.

Our commercial success
will depend in part on our success in obtaining and maintaining patents, copyrights, trademarks, trade secrets and other intellectual
property rights in China and elsewhere and protecting our proprietary technology. If we do not adequately protect our intellectual
property and proprietary technology, competitors may be able to use our technologies or the goodwill we have acquired in the marketplace
and erode or negate any competitive advantage we may have, which could harm our business and ability to achieve profitability.

We
cannot make any assurances that our core trademarks include a scope sufficient to protect our services and products. For example,
our key trademarks “

(Infobird), “

(Xun Niao), “” (Yun Tong Bao) and “

(Qi Tong Bao) are not registered under the category “Software as a Service (SaaS)” in Class 42, in which event third
parties would be able to use such logos under category “Software as a Service (SaaS)” in Class 42 without our authorization,
and we may even be subjected to claims by third parties for infringement by using such logos. In addition, we did not enter into
a trademark transfer agreement with the transferor on trademark “” in 2012, in which event
the transferor may claim that the historical transfer of the trademark is flawed and file a claim against the ownership of the
transferred trademark.

We cannot make any
assurances that the protection of our copyrights are sufficient. For example, our core technology, our no-code development platform,
is not registered as a software copyright, which makes the technology vulnerable to the risk of third party’s infringement.
Even though we intend to submit an application for copyright registration for our no-code development platform, we cannot assure
you when the application will be submitted or the registration will be completed, if at all, and whether the application will
be rejected by the National Copyright Administration of the PRC once submitted.

We cannot provide
any assurances that any of our patents have, or that any of our pending patent applications that mature into issued patents will
include, claims with a scope sufficient to protect our products, any additional features we develop for our products or any new
products. Other parties may have developed technologies that may be related or competitive to our system, may have filed or may
file patent applications and may have received or may receive patents that overlap or conflict with our patent applications, either
by claiming the same methods or devices or by claiming subject matter that could dominate our patent position. Our patent position
may involve complex legal and factual questions, and, therefore, the scope, validity and enforceability of any patent claims that
we may obtain cannot be predicted with certainty. Patents, if issued, may be challenged, deemed unenforceable, invalidated or
circumvented. Proceedings challenging our patents could result in either loss of the patent or denial of the patent application
or loss or reduction in the scope of one or more of the claims of the patent or patent application. In addition, such proceedings
may be costly. Thus, any patents that we may own may not provide any protection against competitors. Furthermore, an adverse decision
in an interference proceeding can result in a third party receiving the patent right sought by us, which in turn could affect
our ability to commercialize our products.

Though an issued
patent is presumed valid and enforceable, its issuance is not conclusive as to its validity or its enforceability and it may not
provide us with adequate proprietary protection or competitive advantages against competitors with similar products. Competitors
could purchase our products and attempt to replicate some or all of the competitive advantages we derive from our development
efforts, willfully infringe our intellectual property rights, design around our patents, or develop and obtain patent protection
for more effective technologies, designs or methods. We may be unable to prevent the unauthorized disclosure or use of our technical
knowledge or trade secrets by consultants, suppliers, vendors, former employees and current employees.

Our ability to enforce
our patent rights depends on our ability to detect infringement. It may be difficult to detect infringers who do not advertise
the components that are used in their products. Moreover, it may be difficult or impossible to obtain evidence of infringement
in a competitor’s or potential competitor’s product. We may not prevail in any lawsuits that we initiate and the damages or other
remedies awarded if we were to prevail may not be commercially meaningful.

In addition, proceedings
to enforce or defend our patents could put our patents at risk of being invalidated, held unenforceable or interpreted narrowly.
Such proceedings could also provoke third parties to assert claims against us, including that some or all of the claims in one
or more of our patents are invalid or otherwise unenforceable. If any of our patents covering our products are invalidated or
found unenforceable, or if a court found that valid, enforceable patents held by third parties covered one or more of our products,
our competitive position could be harmed or we could be required to incur significant expenses to enforce or defend our rights.

The degree of future
protection for our proprietary rights is uncertain, and we cannot ensure that:

· any
of our patents, or any of our pending patent applications, if issued, will include claims
having a scope sufficient to protect our products;

· any
of our pending patent applications will be issued as patents;

· we
will be able to successfully commercialize our products on a substantial scale, if approved,
before our relevant patents we may have expire;

· we
were the first to make the inventions covered by each of our patents and pending patent
applications;

· we
were the first to file patent applications for these inventions;

· others
will not develop similar or alternative technologies that do not infringe our patents;
any of our patents will be found to ultimately be valid and enforceable;

· any
patents issued to us will provide a basis for an exclusive market for our commercially
viable products, will provide us with any competitive advantages or will not be challenged
by third parties;

· we
will develop additional proprietary technologies or products that are separately patentable;
or

· our
commercial activities or products will not infringe upon the patents of others.

We rely, in part,
upon unpatented trade secrets, unpatented know-how and continuing technological innovation to develop and maintain our competitive
position. Further, our trade secrets could otherwise become known or be independently discovered by our competitors.

Litigation
or other proceedings or third-party claims of intellectual property infringement could require us to spend significant time and
money and could prevent us from selling our products or affect our stock price.

Our commercial success
will depend in part on not infringing the patents or copyrights, or otherwise violating the other proprietary rights, of others.
Significant litigation regarding patent rights and copyright rights occur in our industry. Our competitors in both the United
States and abroad, many of which have substantially greater resources and have made substantial investments in patent portfolios
and competing technologies, may have applied for or obtained or may in the future apply for and obtain, patents that will prevent,
limit or otherwise interfere with our ability to make, use and sell our products. We do not always conduct independent reviews
of patents issued to third parties. In addition, patent applications in China and elsewhere can be pending for many years before
issuance, or unintentionally abandoned patents or applications can be revived, so there may be applications of others now pending
or recently revived patents of which we are unaware. These applications may later result in issued patents, or the revival of
previously abandoned patents, that will prevent, limit or otherwise interfere with our ability to make, use or sell our products.
Third parties may, in the future, assert claims that we are employing their proprietary technology without authorization, including
claims from competitors or from non-practicing entities that have no relevant product revenue and against whom our own patent
portfolio may have no deterrent effect. As we continue to commercialize our products in their current or updated forms, launch
new products and enter new markets, we expect competitors may claim that one or more of our products infringe their intellectual
property rights as part of business strategies designed to impede our successful commercialization and entry into new markets.
The large number of patents, the rapid rate of new patent applications and issuances, the complexities of the technology involved,
and the uncertainty of litigation may increase the risk of business resources and management’s attention being diverted to patent
litigation. We have, and we may in the future, receive letters or other threats or claims from third parties inviting us to take
licenses under, or alleging that we infringe, their patents.

Moreover, we may
become party to future adversarial proceedings regarding our patent portfolio or the patents of third parties. Patents may be
subjected to opposition, post-grant review or comparable proceedings lodged in various foreign, both national and regional, patent
offices. The legal threshold for initiating litigation or contested proceedings may be low, so that even lawsuits or proceedings
with a low probability of success might be initiated. Litigation and contested proceedings can also be expensive and time-consuming,
and our adversaries in these proceedings may have the ability to dedicate substantially greater resources to prosecuting these
legal actions than we can. We may also occasionally use these proceedings to challenge the patent rights of others. We cannot
be certain that any particular challenge will be successful in limiting or eliminating the challenged patent rights of the third
party.

Any lawsuits resulting
from such allegations could subject us to significant liability for damages and invalidate our proprietary rights. Any potential
intellectual property litigation also could force us to do one or more of the following:

· stop
making, selling or using products or technologies that allegedly infringe the asserted
intellectual property;

· lose
the opportunity to license our technology to others or to collect royalty payments based
upon successful protection and assertion of our intellectual property rights against
others; incur significant legal expenses;

· pay
substantial damages or royalties to the party whose intellectual property rights we may
be found to be infringing;

· pay
the attorney’s fees and costs of litigation to the party whose intellectual property
rights we may be found to be infringing;

· redesign
those products that contain the allegedly infringing intellectual property, which could
be costly, disruptive and infeasible; and

· attempt
to obtain a license to the relevant intellectual property from third parties, which may
not be available on reasonable terms or at all, or from third parties who may attempt
to license rights that they do not have.

Any litigation or
claim against us, even those without merit, may cause us to incur substantial costs, and could place a significant strain on our
financial resources, divert the attention of management from our core business and harm our reputation. If we are found to infringe
the intellectual property rights of third parties, we could be required to pay substantial damages (which may be increased up
to three times of awarded damages) and/or substantial royalties and could be prevented from selling our products unless we obtain
a license or are able to redesign our products to avoid infringement. Any such license may not be available on reasonable terms,
if at all, and there can be no assurance that we would be able to redesign our products in a way that would not infringe the intellectual
property rights of others. We could encounter delays in product introductions while we attempt to develop alternative methods
or products. If we fail to obtain any required licenses or make any necessary changes to our products or technologies, we may
have to withdraw existing products from the market or may be unable to commercialize one or more of our products.

If we are unable
to protect the confidentiality of our trade secrets, our business and competitive position could be harmed.

We rely on copyright,
patent, trade secret, and trademark protection as well as confidentiality agreements with our employees, consultants and third
parties, and we may in the future rely on additional intellectual property protection, to protect our confidential and proprietary
information. In addition to contractual measures, we try to protect the confidential nature of our proprietary information using
commonly accepted physical and technological security measures. Such measures may not, for example, in the case of misappropriation
of a trade secret by an employee or third party with authorized access, provide adequate protection for our proprietary information.
Our security measures may not prevent an employee or consultant from misappropriating our trade secrets and providing them to
a competitor, and recourse we take against such misconduct may not provide an adequate remedy to protect our interests fully.
Unauthorized parties may also attempt to copy or reverse engineer certain aspects of our products that we consider proprietary.
Enforcing a claim that a party illegally disclosed or misappropriated a trade secret can be difficult, expensive and time-consuming,
and the outcome is unpredictable. Even though we use commonly accepted security measures, trade secret violations are often a
matter of state law, and the criteria for protection of trade secrets can vary among different jurisdictions. In addition, trade
secrets may be independently developed by others in a manner that could prevent legal recourse by us. If any of our confidential
or proprietary information, such as our trade secrets, were to be disclosed or misappropriated, or if any such information was
independently developed by a competitor, our business and competitive position could be harmed.

Third parties
may assert ownership or commercial rights to inventions we develop, which could have a material adverse effect on our business.

Third parties may
in the future make claims challenging the inventorship or ownership of our intellectual property. Any infringement claims or lawsuits,
even if not meritorious, could be expensive and time consuming to defend, divert management’s attention and resources, require
us to redesign our products and services, if feasible, require us to pay royalties or enter into licensing agreements in order
to obtain the right to use necessary technologies, and/or may materially disrupt the conduct of our business.

In addition, we may
face claims by third parties that our agreements with employees, contractors or third parties obligating them to assign intellectual
property to us are ineffective or in conflict with prior or competing contractual obligations of assignment, which could result
in ownership disputes regarding intellectual property we have developed or will develop and interfere with our ability to capture
the commercial value of such intellectual property. Litigation may be necessary to resolve an ownership dispute, and if we are
not successful, we may be precluded from using certain intellectual property or may lose our exclusive rights in that intellectual
property. Either outcome could harm our business and competitive position.

Third parties
may assert that our employees or contractors have wrongfully used or disclosed confidential information or misappropriated trade
secrets, which could result in litigation.

We may employ individuals
who previously worked with other companies, including our competitors or potential competitors. Although we try to ensure that
our employees and contractors do not use the proprietary information or know-how of others in their work for us, we may be subject
to claims that we or our employees or contractors have inadvertently or otherwise used or disclosed intellectual property or personal
data, including trade secrets or other proprietary information, of a former employer or other third party. Litigation may be necessary
to defend against these claims. If we fail in defending any such claims or settling those claims, in addition to paying monetary
damages or a settlement payment, we may lose valuable intellectual property rights or personnel. Even if we are successful in
defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees.

Our computer
systems and operations may be vulnerable to security breaches, which could materially and adversely affect our business
.

We believe the safety
of our computer network and our secure transmission of information over the internet will be essential to our operations and our
services. Our network and our computer infrastructure are potentially vulnerable to physical breaches or to the introduction of
computer viruses, abuse of use and similar disruptive problems and security breaches that could cause loss (both economic and
otherwise), interruptions, delays or loss of services to our users. It is possible that advances in computer capabilities or new
technologies could result in a compromise or breach of the technology we use to protect user transaction data. A party that is
able to circumvent our security systems could misappropriate proprietary information, cause interruptions in our operations or
utilize our network without authorization. Security breaches also could damage our reputation and expose us to a risk of loss,
litigation and possible liability. We cannot guarantee you that our security measures will prevent security breaches.

Risks Related to Our Corporate Structure

We depend upon
the Contractual Arrangements in conducting our business in China, which may not be as effective as direct ownership.

Our affiliation with
Infobird Beijing is managed through the Contractual Arrangements, which agreements may not be as effective in providing us with
control over Infobird Beijing as direct ownership in controlling entities organized in the PRC, which often hold the licenses
necessary to conduct business in the PRC. The Contractual Arrangements are governed by and would be interpreted in accordance
with the laws of the PRC. If Infobird Beijing fails to perform the obligations under the Contractual Arrangements, we may have
to rely on legal remedies under the laws of the PRC, including seeking specific performance or injunctive relief, and claiming
damages. There is a risk that we may be unable to obtain any of these remedies. The legal environment in the PRC is not as developed
as in other jurisdictions. As a result, uncertainties in the PRC legal system could limit our ability to enforce the Contractual
Arrangements, or could affect the validity of the Contractual Arrangements.

We may not
be able to consolidate the financial results of some of our affiliated companies or such consolidation could materially and adversely
affect our operating results and financial condition.

Our business is conducted
through Infobird Beijing, which is considered a VIE for accounting purposes, and we, through Infobird WFOE, are considered the
primary beneficiary, thus enabling us to consolidate our financial results in our consolidated financial statements. In the event
that in the future a company we hold as a VIE no longer meets the definition of a VIE under applicable accounting rules, or we
are deemed not to be the primary beneficiary, we would not be able to consolidate line by line that entity’s financial results
in our consolidated financial statements for reporting purposes. Also, if in the future an affiliate company becomes a VIE and
we become the primary beneficiary, we would be required to consolidate that entity’s financial results in our consolidated
financial statements for accounting purposes. If such entity’s financial results were negative, this would have a corresponding
negative impact on our operating results for reporting purposes.

Because we
rely on the Contractual Arrangements for our revenue, the termination of these agreements would severely and detrimentally affect
our continuing business viability under our current corporate structure.

We are a holding
company and all of our business operations are conducted through the Contractual Arrangements. Although Infobird Beijing does
not have termination rights pursuant to the Contractual Arrangements, it could terminate, or refuse to perform under, the Contractual
Arrangements. Because neither we, nor our subsidiaries, own equity interests of Infobird Beijing, the termination or non-performance
of the Contractual Arrangements would sever our ability to receive payments from Infobird Beijing under our current holding company
structure. While we are currently not aware of any event or reason that may cause the Contractual Arrangements to terminate, we
cannot assure you that such an event or reason will not occur in the future. In the event that the Contractual Arrangements are
terminated, this would have a severe and detrimental effect on our continuing business viability under our current corporate structure,
which, in turn, would affect the value of your investment.

Contractual
arrangements in relation to our VIE may be subject to scrutiny by the PRC tax authorities and they may determine that we or our
VIE owe additional taxes, which could negatively affect our financial condition and the value of your investment.

Under applicable
PRC laws and regulations, arrangements and transactions among related parties may be subject to audit or challenge by the PRC
tax authorities within ten years after the taxable year when the transactions are conducted. We could face material and adverse
tax consequences if the PRC tax authorities determine that the VIE contractual arrangements were not entered into on an arm’s-length
basis in such a way as to result in an impermissible reduction in taxes under applicable PRC laws, rules and regulations, and
adjust the income of our VIE in the form of a transfer pricing adjustment. The PRC tax authorities could effectively disregard
our VIE structure, resulting in increased tax liabilities. A transfer pricing adjustment could, among other things, result in
a reduction of expense deductions recorded by our VIE for PRC tax purposes, which could in turn increase tax liabilities without
reducing our tax expenses. In addition, the PRC tax authorities may impose late payment fees and other penalties on our VIE for
the adjusted but unpaid taxes according to the applicable regulations. Our financial position could be materially and adversely
affected if our VIE’s tax liabilities increase or if it is required to pay late payment fees and other penalties.

We conduct
our business through Infobird Beijing by means of Contractual Arrangements. If the PRC courts or administrative authorities determine
that these contractual arrangements do not comply with applicable regulations, we could be subject to severe penalties and our
business could be adversely affected. In addition, changes in such PRC laws and regulations may materially and adversely affect
our business.

There are uncertainties
regarding the interpretation and application of PRC laws, rules and regulations, including the laws, rules and regulations governing
the validity and enforcement of the Contractual Arrangements between Infobird WFOE and Infobird Beijing. We have been advised
by our PRC counsel, Fangda Partners, based on their understanding of the current PRC laws, rules and regulations, that (i) the
structure for operating our business in China (including our corporate structure and Contractual Arrangements with Infobird WFOE,
Infobird Beijing and its shareholders) will not result in any violation of PRC laws or regulations currently in effect; and (ii)
the Contractual Arrangements among Infobird WFOE and Infobird Beijing and its shareholders governed by PRC law are valid, binding
and enforceable, and will not result in any violation of PRC laws or regulations currently in effect. However, there are substantial
uncertainties regarding the interpretation and application of current or future PRC laws and regulations concerning foreign investment
in the PRC, and their application to and effect on the legality, binding effect and enforceability of the contractual arrangements.
In particular, we cannot rule out the possibility that PRC regulatory authorities, courts or arbitral tribunals may in the future
adopt a different or contrary interpretation or take a view that is inconsistent with the opinion of our PRC legal counsel. Therefore,
the Contractual Arrangements may be determined by PRC authorities to be inconsistent with the laws and regulations of the PRC,
including those related to foreign investment in certain industries.

If any of our PRC
entities or their ownership structure or the Contractual Arrangements are determined to be in violation of any existing or future
PRC laws, rules or regulations, or any of our PRC entities fail to obtain or maintain any of the required governmental permits
or approvals, the relevant PRC regulatory authorities would have broad discretion in dealing with such violations, including:

· revoking
the business and operating licenses;

· discontinuing
or restricting the operations;

· imposing
conditions or requirements with which the PRC entities may not be able to comply;

· requiring
us and our PRC entities to restructure the relevant ownership structure or operations,
including termination of the contractual agreements with our VIE and deregistering the
equity pledge of our VIE, which in turn would affect our ability to consolidate, derive
economic interests from, or exert effective control our VIE;

· restricting
or prohibiting our use of the proceeds from this offering to finance our business and
operations in China, and taking other regulatory or enforcement actions that could be
harmful to our business; or

· imposing
fines or confiscating the income from our PRC subsidiaries or our VIE.

The imposition of any of these penalties
would severely disrupt our ability to conduct business and have a material adverse effect on our financial condition, results
of operations and prospects.

The shareholders
of our VIE may have actual or potential conflicts of interest with us and as a result may refuse to perform, or may breach, the
Contractual Arrangements, which may materially and adversely affect our business and financial condition.

The shareholders
of our VIE may have actual or potential conflicts of interest with us. These shareholders may refuse to perform or sign or may
breach, or cause our VIE to breach, or refuse to renew, the existing Contractual Arrangements, which would have a material and
adverse effect on our ability to effectively control our VIE and receive economic benefits from it. As a result, control over,
and funds due from, our VIE may be jeopardized if the shareholders of our VIE breach, or refuse to renew, the Contractual Arrangements.
For example, the shareholders may be able to cause our agreements with our VIE to be performed in a manner adverse to us by, among
other things, failing to remit payments due under the contractual arrangements to us on a timely basis. We cannot assure you that
when conflicts of interest arise any or all of these shareholders will act in the best interests of our company or such conflicts
will be resolved in our favor. Currently, we do not have any arrangements to address potential conflicts of interest between these
shareholders and our company. If we cannot resolve any conflict of interest or dispute between us and these shareholders, we would
have to rely on legal proceedings, which could result in disruption of our business and subject us to substantial uncertainty
as to the outcome of any such legal proceedings.

Any failure
by our VIE or its shareholders to perform their obligations under the Contractual Arrangements, or any unauthorized use of indicia
of corporate power or authority, would have a material adverse effect on our business.

If our VIE or its
shareholders fail to perform their respective obligations under the Contractual Arrangements or if any physical instruments, such
as chops and seals, or other indicia of corporate power or authority, are used without our authorization, we may have to incur
substantial costs and expend additional resources to seek legal remedies under PRC laws, including specific performance or injunctive
relief, and/or claiming damages, which we cannot assure you will be effective under PRC laws. For example, if the shareholders
of our VIE were to refuse to transfer their equity interest in the VIEs to us or our designee if we exercise the purchase option
pursuant to the Contractual Arrangements, or if they were otherwise to act in bad faith toward us, then we may have to take legal
action to compel them to perform their contractual obligations.

The Contractual Arrangements
are governed by PRC laws. Accordingly, any disputes would be resolved in accordance with PRC legal procedures. The legal environment
in the PRC is not as developed as in other jurisdictions, such as the U.S. As a result, uncertainties in the PRC legal system
could limit our ability to enforce the Contractual Arrangements or could affect the validity of the Contractual Arrangements,
and as a result we may not be able to exert effective control over our VIE, and our ability to conduct our business may therefore
be materially adversely affected.

Our current
corporate structure and business operations may be affected by the newly enacted Foreign Investment Law.

On March 15, 2019,
the National People’s Congress approved the Foreign Investment Law, which took effect on January 1, 2020. Since it is relatively
new, uncertainties exist in relation to its interpretation and its implementation rules that are yet to be issued. The Foreign
Investment Law does not explicitly classify whether variable interest entities that are controlled through contractual arrangements
would be deemed as foreign-invested enterprises if they are ultimately “controlled” by foreign investors. However,
it has a catch-all provision under definition of “foreign investment” that includes investments made by foreign investors
in China through other means as provided by laws, administrative regulations or the State Council of the PRC, or the State Council.
Therefore, it still leaves leeway for future laws, administrative regulations or provisions of the State Council to provide for
contractual arrangements as a form of foreign investment. Therefore, there can be no assurance that our control over our VIE through
contractual arrangements will not be deemed as foreign investment in the future.

The Foreign Investment
Law grants national treatment to foreign-invested entities, except for those foreign-invested entities that operate in industries
specified as either “restricted” or “prohibited” from foreign investment in a “negative list”.
The Foreign Investment Law provides that foreign-invested entities operating in “restricted” or “prohibited”
industries will require market entry clearance and other approvals from relevant PRC government authorities. If our control over
our VIE through contractual arrangements are deemed as foreign investment in the future, and any business of our VIE is “restricted”
or “prohibited” from foreign investment under the “negative list” effective at the time, we may be deemed
to be in violation of the Foreign Investment Law, the contractual arrangements that allow us to have control over our VIE may
be deemed as invalid and illegal, and we may be required to unwind such contractual arrangements and/or restructure our business
operations, any of which may have a material adverse effect on our business operations.

Furthermore, if future
laws, administrative regulations or provisions mandate further actions to be taken by companies with respect to existing contractual
arrangements, we may face substantial uncertainties as to whether we can complete such actions in a timely manner, or at all.
Failure to take timely and appropriate measures to cope with any of these or similar regulatory compliance challenges could materially
and adversely affect our current corporate structure and business operations.

If any of our
affiliated entities becomes the subject of a bankruptcy or liquidation proceeding, we may lose the ability to use and enjoy assets
held by such entity, which could materially and adversely affect our business, financial condition and results of operations.

We currently conduct
our operations in China through our Contractual Arrangements. As part of these arrangements, substantially all of our assets that
are significant to the operation of our business are held by our affiliated entities. If any of these entities becomes bankrupt
and all or part of their assets become subject to liens or rights of third-party creditors, we may be unable to continue some
or all of our business activities, which could materially and adversely affect our business, financial condition and results of
operations. In addition, if any of our affiliated entities undergoes a voluntary or involuntary liquidation proceeding, its equity
owner or unrelated third-party creditors may claim rights relating to some or all of these assets, which would hinder our ability
to operate our business and could materially and adversely affect our business, our ability to generate revenue and the market
price of our ordinary shares.

Risks Related to Doing Business
in China

We face risks
related to natural disasters, health epidemics and other outbreaks, specifically the coronavirus, which could significantly disrupt
our operations.

In recent years,
there have been outbreaks of epidemics in various countries, including China. Recently, there was an outbreak of a novel strain
of coronavirus (COVID-19) in China, which has spread rapidly to several parts of the world. COVID-19 has resulted in quarantines,
travel restrictions, and the temporary closure of stores and facilities throughout China and several other parts of the world.
In March 2020, the World Health Organization declared COVID-19 a pandemic.

Substantially all
of our revenues and our workforce are concentrated in China. Consequently, our results of operations will likely be adversely,
and may be materially, affected, to the extent that the COVID-19 pandemic or any other epidemic harms the Chinese and global economy
in general. Any potential impact to our results will depend on, to a large extent, future developments and new information that
may emerge regarding the duration and severity of the COVID-19 pandemic and the actions taken by government authorities and other
entities to contain the COVID-19 pandemic or treat its impact, almost all of which are beyond our control. Current and potential
impacts include, but are not limited to, the following:

·
We temporarily closed our offices and implemented a work-from-home
policy beginning in February 2020, as required by relevant PRC regulatory authorities. We reopened our offices in April 2020;

·
Due to the nature of our business, the impact of the closure on
our operational capabilities was insignificant, as most of our work force continued working offsite during such office closures;

·
Our customers could potentially be negatively impacted by COVID-19,
which may reduce their budgets for customer services in 2021 and beyond. We experienced a decrease in revenue in the first half
of 2020, and although revenue was back to our expected level in June 2020, our overall revenue, gross profit and net income may
be negatively impacted in 2020; and

·
The situation may worsen if the COVID-19 pandemic continues.
We have not yet experienced significant late payments from our customers, but we may if the situation worsens. We will continue
to closely monitor our payment collections throughout 2021 and beyond.

Because of the uncertainty
surrounding the COVID-19 pandemic, the financial impact related to COVID-19 cannot be reasonably estimated at this time. Although
our consolidated results for the first half of 2020 have been adversely affected, we expect our total revenues in the fiscal year
2021 to increase as compared to the majority of 2020 due to demand for our standard cloud-based services, but there is no guarantee
that our total revenues for the fiscal year 2021 will grow or remain at a similar level compared to the fiscal year 2019 and such
results of operations for the fiscal year 2021 may still be adversely impacted by the COVID-19 pandemic compared to the fiscal
year 2019 and the majority of 2020.

In general, our business
could be adversely affected by the effects of epidemics, including, but not limited to, COVID-19, avian influenza, severe acute
respiratory syndrome (SARS), the influenza A virus, Ebola virus, severe weather conditions such as a snowstorm, flood or hazardous
air pollution, or other outbreaks. In response to an epidemic, severe weather conditions, or other outbreaks, government and other
organizations may adopt regulations and policies that could lead to severe disruption to our daily operations, including temporary
closure of our offices and other facilities. These severe conditions may cause us and/or our partners to make internal adjustments,
including but not limited to, temporarily closing down business, limiting business hours, and setting restrictions on travel and/or
visits with clients and partners for a prolonged period of time. Various impacts arising from severe conditions may cause business
disruption, resulting in material, adverse impact to our financial condition and results of operations.

Changes in
China’s economic, political or social conditions or government policies could have a material adverse effect on our business and
operations.

Substantially all
of our assets and operations are located in China. Accordingly, our business, financial condition, results of operations and prospects
may be influenced to a significant degree by political, economic and social conditions in China generally and therefore by the
significant discretion of Chinese governmental authorities. The Chinese economy differs from the economies of most developed countries
in many respects, including the level of government involvement, level of development, growth rate, control of foreign exchange
and allocation of resources. Although the PRC government has implemented measures emphasizing the utilization of market forces
for economic reform, the reduction of state ownership of productive assets, and the establishment of improved corporate governance
in business enterprises, a substantial portion of productive assets in China is still owned by the government. In addition, the
PRC government continues to play a significant role in regulating industry development by imposing industrial policies. The PRC
government also exercises significant control over China’s economic growth through allocating resources, controlling payment
of foreign currency-denominated obligations, setting monetary policy, and providing preferential treatment to particular industries
or companies. The increased global focus on environmental and social issues and China’s potential adoption of more stringent
standards in these areas may adversely impact the operations of China-based issuers, including us.

While the Chinese
economy has experienced significant growth over past decades, growth has been uneven, both geographically and among various sectors
of the economy, and the rate of growth has been slowing since 2012. Any adverse changes in economic conditions in China, in the
policies of the PRC government or in the laws and regulations in China could have a material adverse effect on the overall economic
growth of China. Such developments could materially and adversely affect our business and operating results, lead to a reduction
in demand for our services and adversely affect our competitive position. The PRC government has implemented various measures
to encourage economic growth and guide the allocation of resources. Some of these measures may benefit the overall Chinese economy,
but may have a negative effect on us. For example, our financial condition and results of operations may be adversely affected
by government control over capital investments or changes in tax regulations. In addition, in the past the PRC government has
implemented certain measures, including interest rate adjustment, to control the pace of economic growth. These measures may cause
decreased economic activity in China, which may materially and adversely affect our business and operating results.

If we become
subject to the recent scrutiny, criticism and negative publicity involving U.S.-listed China-based companies, we may have to expend
significant resources to investigate and resolve the matter which could harm our business operations, this offering and our reputation
and could result in a loss of your investment in our ordinary shares, in particular if such matter cannot be addressed and resolved
favorably.

Recently, U.S. public
companies that have substantially all of their operations in China have been the subject of intense scrutiny, criticism and negative
publicity by investors, financial commentators and regulatory agencies. Much of the scrutiny, criticism and negative publicity
has centered around financial and accounting irregularities, a lack of effective internal controls over financial accounting,
inadequate corporate governance policies or a lack of adherence thereto and, in some cases, allegations of fraud. As a result
of the scrutiny, criticism and negative publicity, the publicly traded stock of many U.S.-listed China-based companies has decreased
in value and, in some cases, has become virtually worthless. Many of these companies are now subject to shareholder lawsuits and
SEC enforcement actions and are conducting internal and external investigations into the allegations. It is not clear what effect
this sector-wide scrutiny, criticism and negative publicity will have on us, our business and this offering. If we become the
subject of any unfavorable allegations, whether such allegations are proven to be true or untrue, we will have to expend significant
resources to investigate such allegations and/or defend our company. This situation may be a major distraction to our management.
If such allegations are not proven to be groundless, our business operations will be severely hindered and your investment in
our ordinary shares could be rendered worthless.

U.S. regulatory
bodies may be limited in their ability to conduct investigations or inspections of our operations in China.

Any disclosure of
documents or information located in China by foreign agencies may be subject to jurisdiction constraints and must comply with
China’s state secrecy laws, which broadly define the scope of « state secrets » to include matters involving economic
interests and technologies. There is no guarantee that requests from U.S. federal or state regulators or agencies to investigate
or inspect our operations will be honored by us, by entities who provide services to us or with whom we associate, without violating
PRC legal requirements, particularly those entities that are located within China. Furthermore, under the current PRC laws, an
on-site inspection of our facilities by any of these regulators may be limited or prohibited.

There are uncertainties
under the PRC laws relating to the procedures for U.S. regulators to investigate and collect evidence from companies located in
the PRC.

Shareholder claims
that are common in the United States, including securities law class actions and fraud claims, generally are difficult to pursue
as a matter of law or practicality in China. For example, in China, there are significant legal and other obstacles to obtaining
information needed for shareholder investigations or litigation outside China or otherwise with respect to foreign entities. Although
the local authorities in China may establish a regulatory cooperation mechanism with the securities regulatory authorities of
another country or region to implement cross-border supervision and administration, such regulatory cooperation with the securities
regulatory authorities in the Unities States have not been efficient in the absence of mutual and practical cooperation mechanism.
According to Article 177 of the PRC Securities Law, which became effective in March 2020, or Article 177, the securities regulatory
authority of the State Council may collaborate with securities regulatory authorities of other countries or regions in order to
monitor and oversee cross border securities activities. Article 177 further provides that overseas securities regulatory authorities
are not allowed to carry out investigation and evidence collection directly within the territory of the PRC, and that any Chinese
entities and individuals are not allowed to provide documents or materials related to securities business activities to overseas
agencies without prior consent of the securities regulatory authority of the State Council and the competent departments of the
State Council.

Our principal business
operations are conducted in the PRC. In the event that the U.S. regulators carry out investigations on us and there is a need
to conduct investigation or collect evidence within the territory of the PRC, the U.S. regulators may not be able to carry out
such investigation or evidence collection directly in the PRC under the PRC laws. The U.S. regulators may consider cross-border
cooperation with securities regulatory authority of the PRC by way of judicial assistance, diplomatic channels or regulatory cooperation
mechanism established with the securities regulatory authority of the PRC. However, there is no assurance that the U.S. regulators
could succeed in establishing such cross-border cooperation in a specific case or could establish the cooperation in a timely
manner. If U.S. regulators are unable to conduct such investigations, such U.S. regulators may determine to suspend and ultimately
delist our ordinary shares from the Nasdaq Capital Market or choose to suspend or de-register our SEC registration.

Uncertainties
with respect to China’s legal system could materially and adversely affect us.

The PRC legal system
is a civil law system based on written statutes. Unlike the common law system, prior court decisions under the civil law system
may be cited for reference but have limited precedential value.

In 1979, the PRC
government began to promulgate a comprehensive system of laws and regulations governing economic matters in general. The overall
effect of legislation over the past three decades has significantly enhanced the protections afforded to various forms of foreign
investments in China. However, PRC law still restricts certain foreign investments in China, and such laws are continually evolving,
as more fully described under “Regulation – Regulations Relating to Foreign Investment”. China has not developed a
fully integrated legal system, and recently enacted laws and regulations may not sufficiently cover all aspects of economic activities
in China. In particular, the interpretation and enforcement of these laws and regulations involve uncertainties. Since PRC administrative
and court authorities have significant discretion in interpreting and implementing statutory provisions and contractual terms,
it may be difficult to evaluate the outcome of administrative and court proceedings and the level of legal protection we enjoy.
These uncertainties may affect our judgment on the relevance of legal requirements and our ability to enforce our contractual
arrangements and rights, including under the Contractual Arrangements, or tort claims. In addition, the regulatory uncertainties
may be exploited through unmerited or frivolous legal actions or threats in attempts to extract payments or benefits from us.

Furthermore, the
PRC legal system is based in part on government policies and internal rules, some of which are not published on a timely basis
or at all and may have a retroactive effect. As a result, we may not be aware of our violation of any of these policies and rules
until sometime after the violation. In addition, any administrative and court proceedings in China may be protracted, resulting
in substantial costs and diversion of resources and management attention. Further, such evolving laws and regulations and the
inconsistent enforcement thereof could also lead to failure to obtain or maintain licenses and permits to do business in China,
which would adversely affect us.

Changes in
international trade policies, trade disputes, barriers to trade, or the emergence of a trade war may dampen growth in China and
may have a material adverse effect on our business.

Political events,
international trade disputes, and other business interruptions could harm or disrupt international commerce and the global economy,
and could have a material adverse effect on us and our customers, service providers, and other partners. International trade disputes
could result in tariffs and other protectionist measures which may materially and adversely affect our business. Tariffs could
increase the cost of the goods and products which could affect customers’ spending levels. In addition, political uncertainty
surrounding international trade disputes and the potential of the escalation to trade war and global recession could have a negative
effect on customer confidence, which could materially and adversely affect our business. We may have also access to fewer business
opportunities, and our operations may be negatively impacted as a result. In addition, the current and future actions or escalations
by either the United States or China that affect trade relations may cause global economic turmoil and potentially have a negative
impact on our markets, our business, or our results of operations, and we cannot provide any assurances as to whether such actions
will occur or the form that they may take.

We must remit
the offering proceeds to China before they may be used to benefit our business in China, and we cannot assure that we can finish
all necessary governmental registration processes in a timely manner.

The proceeds of this
offering must be sent back to China, and the process for sending such proceeds back to China may take several months after the
closing of this offering. In utilizing the proceeds of this offering in the manner described in “Use of Proceeds,”
as an offshore holding company of our PRC subsidiaries, we may make loans to our PRC subsidiaries, or we may make additional capital
contributions to our PRC subsidiaries. Any shareholder loan or additional capital contribution are subject to PRC regulations.
For example, loans by us or making additional capital contribution to our subsidiaries in China, which are FIEs, to finance their
activities cannot exceed statutory limits, while the shareholder loan must be also registered with the SAFE. The statutory limit
for the total amount of foreign debts of a foreign-invested company is the difference between the amount of total investment as
approved by MOFCOM or its local counterpart and the amount of registered capital of such foreign-invested company.

To remit the proceeds
of this offering, we must take the steps legally required under the PRC laws. In light of the various requirements imposed by
PRC regulations on loans to, and direct investment in, PRC entities by offshore holding companies, we cannot assure you that we
will be able to complete the necessary government registrations or obtain the necessary government approvals on a timely basis,
if at all, with respect to future loans by us to our PRC subsidiaries or with respect to future capital contributions by us to
our PRC subsidiaries. If we fail to complete such registrations or obtain such approvals, our ability to use the proceeds from
this offering and to capitalize or otherwise fund our PRC operations may be negatively affected, which could materially and adversely
affect our liquidity, our ability to fund and expand our business and our ordinary shares.

You may experience
difficulties in effecting service of legal process, enforcing foreign judgments, including those obtained in the U.S., or bringing
actions in China against us or our management named in the prospectus based on foreign laws.

We are a holding
company incorporated under the laws of the Cayman Islands. We conduct substantially all of our operations in China and substantially
all of our assets are located in China. In addition, all our senior employees reside within China for a significant portion of
the time and most are PRC residents. As a result, it may be difficult for our shareholders to effect service of process upon us
or those persons inside mainland China, including our management. In addition, China does not have treaties providing for the
reciprocal recognition and enforcement of judgments of courts with the Cayman Islands and many other countries and regions. Therefore,
recognition and enforcement in China of judgments of a court in any of these non-PRC jurisdictions, including the U.S., in relation
to any matter not subject to a binding arbitration provision may be difficult or impossible.

We may rely
on dividends and other distributions on equity paid by our PRC subsidiaries to fund any cash and financing requirements we may
have, and any limitation on the ability of our PRC subsidiaries to make payments to us could have a material and adverse effect
on our ability to conduct our business.

We are a Cayman Islands
holding company and we rely principally on dividends and other distributions on equity from our PRC subsidiaries for our cash
requirements, including for services of any debt we may incur. Our PRC subsidiaries’ ability to distribute dividends is
based upon its distributable earnings. Current PRC regulations permit our PRC subsidiaries to pay dividends to its respective
shareholders only out of their accumulated profits, if any, determined in accordance with PRC accounting standards and regulations.
In addition, each of our PRC subsidiaries is required to set aside at least 10% of its after-tax profits each year, if any, to
fund a statutory reserve until such reserve reaches 50% of its registered capital. Each of our PRC subsidiaries as a FIE is also
required to further set aside a portion of its after-tax profits to fund the employee welfare fund, although the amount to be
set aside, if any, is determined at its discretion. These reserves are not distributable as cash dividends. If our PRC subsidiaries
incur debt on their own behalf in the future, the instruments governing the debt may restrict their ability to pay dividends or
make other payments to us. Any limitation on the ability of our PRC subsidiaries to distribute dividends or other payments to
their respective shareholders could materially and adversely limit our ability to grow, make investments or acquisitions that
could be beneficial to our businesses, pay dividends or otherwise fund and conduct our business.

In addition, the
Enterprise Income Tax Law and its implementation rules provide that a withholding tax rate of up to 10% will be applicable to
dividends payable by Chinese companies to non-PRC-resident enterprises unless otherwise exempted or reduced according to treaties
or arrangements between the PRC central government and governments of other countries or regions where the non-PRC resident enterprises
are incorporated.

PRC regulation
of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion
may delay us from using the proceeds of this offering to make loans or additional capital contributions to our PRC subsidiaries,
which could materially and adversely affect our liquidity and our ability to fund and expand our business.

Any funds we transfer
to our PRC subsidiaries, either as a shareholder loan or as an increase in registered capital, are subject to approval by or registration
with relevant governmental authorities in China. According to the relevant PRC regulations on FIEs in China, capital contributions
to our PRC subsidiaries are subject to the approval of the Ministry of Commerce of the PRC, or the MOFCOM, or its local branches
and registration with other governmental authorities in China. In addition, (a) any foreign loan procured by our PRC subsidiaries
is required to be registered with SAFE or its local branches, and (b) our PRC subsidiaries may not procure loans which exceed
the statutory amount as approved by the MOFCOM or its local branches. Any medium-or long- term loan to be provided by us to our
PRC subsidiaries must be approved by the National Development and Reform Commission, or NDRC and the SAFE or its local branches.
We may not obtain these government approvals or complete such registrations on a timely basis, with respect to future capital
contributions or foreign loans by us to our PRC subsidiaries. If we fail to receive such approvals or complete such registration,
our ability to use the proceeds of this offering and to capitalize our PRC operations may be negatively affected, which could
materially and adversely affect our liquidity and our ability to fund and expand our business.

In 2008, SAFE promulgated
the Circular on the Relevant Operating Issues Concerning the Improvement of the Administration of the Payment and Settlement of
Foreign Currency Capital of Foreign-Invested Enterprises, or SAFE Circular 142. SAFE Circular 142 regulates the conversion by
FIEs of foreign currency into Renminbi by restricting the usage of converted Renminbi. SAFE Circular 142 provides that any Renminbi
capital converted from registered capitals in foreign currency of FIEs may only be used for purposes within the business scopes
approved by PRC governmental authority and such Renminbi capital may not be used for equity investments within China unless otherwise
permitted by PRC law. In addition, the SAFE strengthened its oversight of the flow and use of Renminbi capital converted from
registered capital in foreign currency of FIEs. The use of such Renminbi capital may not be changed without SAFE approval, and
such Renminbi capital may not in any case be used to repay Renminbi loans if the proceeds of such loans have not been utilized.
On July 4, 2014, SAFE issued the Circular of the SAFE on Relevant Issues Concerning the Pilot Reform in Certain Areas of the Administrative
Method of the Conversion of Foreign Exchange Funds by Foreign-invested Enterprises, or SAFE Circular 36, which launched the pilot
reform of administration regarding conversion of foreign currency registered capitals of FIEs in 16 pilot areas. According to
SAFE Circular 36, some of the restrictions under SAFE Circular 142 will not apply to the settlement of the foreign exchange capitals
of an ordinary FIE in the pilot areas, and such FIE is permitted to use Renminbi converted from its foreign-currency registered
capital to make equity investments in the PRC within and in accordance with the authorized business scope of such FIEs, subject
to certain registration and settlement procedure as set forth in SAFE Circular 36. On March 30, 2015, the SAFE promulgated the
Circular on Reforming the Management Approach Regarding the Foreign Exchange Capital Settlement of Foreign-Invested Enterprises,
or SAFE Circular 19. SAFE Circular 19 took effect as of June 1, 2015 and superseded SAFE Circular 36 and SAFE Circular 142 on
the same date. SAFE Circular 19 launched a nationwide reform of the administration of the settlement of the foreign exchange capitals
of FIEs and allows FIEs to settle their foreign exchange capital at their discretion, but continues to prohibit FIEs from using
the Renminbi fund converted from their foreign exchange capitals for expenditure beyond their business scopes, providing entrusted
loans or repaying loans between non-financial enterprises. Violations of these Circulars could result in severe monetary or other
penalties. SAFE Circular 19 may significantly limit our ability to use Renminbi converted from the net proceeds of this offering
to fund the establishment of new entities in China by our subsidiaries, to invest in or acquire any other PRC companies through
our PRC subsidiaries, or to establish variable interest entities in the PRC, which may materially and adversely affect our business,
financial condition and results of operations. In light of the various requirements imposed by PRC regulations on loans to and
direct investment in PRC entities by offshore holding companies, we cannot assure you that we will be able to complete the necessary
registration or obtain the necessary approval on a timely basis, or at all. If we fail to complete the necessary registration
or obtain the necessary approval, our ability to make loans or equity contributions to our PRC subsidiaries may be negatively
affected, which could materially and adversely affect our PRC subsidiaries’ liquidity and its ability to fund its working
capital and expansion projects and meet its obligations and commitments.

Fluctuations
in exchange rates could have a material and adverse effect on our results of operations and the value of your investment.

The value of the
Renminbi against the U.S. dollar and other currencies may fluctuate and is affected by, among other things, changes in political
and economic conditions in China and by China’s foreign exchange policies. On July 21, 2005, the PRC government changed its decade-old
policy of pegging the value of the Renminbi to the U.S. dollar, and the Renminbi appreciated more than 20% against the U.S. dollar
over the following three years. Between July 2008 and June 2010, this appreciation halted and the exchange rate between the Renminbi
and the U.S. dollar remained within a narrow band. Since June 2010, the Renminbi has fluctuated against the U.S. dollar, at times
significantly and unpredictably. On November 30, 2015, the Executive Board of the International Monetary Fund (IMF) completed
the regular five-year review of the basket of currencies that make up the Special Drawing Right, or the SDR, and decided that
with effect from October 1, 2016, Renminbi is determined to be a freely usable currency and will be included in the SDR basket
as a fifth currency, along with the U.S. dollar, the Euro, the Japanese yen and the British pound. With the development of the
foreign exchange market and progress towards interest rate liberalization and Renminbi internationalization, the PRC government
may in the future announce further changes to the exchange rate system, and we cannot assure you that the Renminbi will not appreciate
or depreciate significantly in value against the U.S. dollar in the future. It is difficult to predict how market forces or PRC
or U.S. government policy may impact the exchange rate between the Renminbi and the U.S. dollar in the future.

Significant revaluation
of the Renminbi may have a material and adverse effect on your investment. For example, to the extent that we need to convert
U.S. dollars we receive from this offering into Renminbi for our operations, appreciation of the Renminbi against the U.S. dollar
would have an adverse effect on the Renminbi amount we would receive from the conversion. Conversely, if we decide to convert
our Renminbi into U.S. dollars for the purpose of making payments for dividends on our ordinary shares or for other business purposes,
appreciation of the U.S. dollar against the Renminbi would have a negative effect on the U.S. dollar amount available to us. In
addition, appreciation or depreciation in the value of the Renminbi relative to U.S. dollars would affect our financial results
reported in U.S. dollar terms regardless of any underlying change in our business or results of operations.

Very limited hedging
options are available in China to reduce our exposure to exchange rate fluctuations. To date, we have not entered into any hedging
transactions in an effort to reduce our exposure to foreign currency exchange risk. While we may decide to enter into hedging
transactions in the future, the availability and effectiveness of these hedges may be limited, and we may not be able to adequately
hedge our exposure, or at all. In addition, our currency exchange losses may be magnified by PRC exchange control regulations
that restrict our ability to convert Renminbi into foreign currency. As a result, fluctuations in exchange rates may have a material
and adverse effect on your investment.

Governmental
control of currency conversion may limit our ability to utilize our net revenues effectively and affect the value of your investment.

The PRC government
imposes controls on the convertibility of the Renminbi into foreign currencies and, in certain cases, the remittance of currency
into or out of China, which essentially may restrict the ability to transfer funds into or out of China. We receive substantially
all of our revenues in Renminbi. Under our current corporate structure, our Cayman Islands holding company primarily relies on
dividend payments from our PRC subsidiaries to fund any cash and financing requirements we may have. Under existing PRC foreign
exchange regulations, payments of current account items, including profit distributions, interest payments and trade and service-related
foreign exchange transactions, can be made in foreign currencies without prior approval of the SAFE by complying with certain
procedural requirements. Specifically, under the existing exchange restrictions, without prior approval of SAFE, cash generated
from the operations of our PRC subsidiaries in China may be used to pay dividends to our company. However, approval from or registration
with appropriate government authorities is required where Renminbi is to be converted into foreign currency and remitted out of
China to pay capital expenses such as the repayment of loans denominated in foreign currencies. As a result, we need to obtain
SAFE approval to use cash generated from the operations of our PRC subsidiaries to pay off their respective debt in a currency
other than Renminbi owed to entities outside China, or to make other capital expenditure payments outside China in a currency
other than Renminbi. The PRC government may at its discretion restrict access to foreign currencies for current account transactions
in the future. If the foreign exchange control system prevents us from obtaining sufficient foreign currencies to satisfy our
foreign currency demands, we may not be able to pay dividends in foreign currencies to our shareholders.

Certain PRC
regulations may make it more difficult for us to pursue growth through acquisitions.

Among other things,
the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors, or the M&A Rules, adopted by six
PRC regulatory agencies in 2006 and amended in 2009, established additional procedures and requirements that could make merger
and acquisition activities by foreign investors more time-consuming and complex. Such regulation requires, among other things,
that the MOFCOM be notified in advance of any change-of-control transaction in which a foreign investor acquires control of a
PRC domestic enterprise or a foreign company with substantial PRC operations, if certain thresholds under the Provisions on Thresholds
for Prior Notification of Concentrations of Undertakings, issued by the State Council in 2008, are triggered. Moreover, the Anti-Monopoly
Law promulgated by the Standing Committee of the NPC which became effective in 2008 requires that transactions which are deemed
concentrations and involve parties with specified turnover thresholds must be cleared by the MOFCOM before they can be completed.
In addition, PRC national security review rules which became effective in September 2011 require acquisitions by foreign investors
of PRC companies engaged in military related or certain other industries that are crucial to national security be subject to security
review before consummation of any such acquisition. We may pursue potential strategic acquisitions that are complementary to our
business and operations. Complying with the requirements of these regulations to complete such transactions could be time-consuming,
and any required approval processes, including obtaining approval or clearance from the MOFCOM, may delay or inhibit our ability
to complete such transactions, which could affect our ability to expand our business or maintain our market share.

PRC regulations
relating to the establishment of offshore special purpose companies by PRC residents may subject our PRC resident beneficial owners
or our PRC subsidiaries to liability or penalties, limit our ability to inject capital into our PRC subsidiaries, limit our PRC
subsidiaries’ ability to increase their registered capital or distribute profits to us, or may otherwise adversely affect
us.

In July 2014, SAFE
promulgated the Circular on Relevant Issues Concerning Foreign Exchange Control on Domestic Residents’ Offshore Investment and
Financing and Roundtrip Investment Through Special Purpose Vehicles, or SAFE Circular 37, to replace the Notice on Relevant Issues
Concerning Foreign Exchange Administration for Domestic Residents’ Financing and Roundtrip Investment Through Offshore Special
Purpose Vehicles, or SAFE Circular 75, which ceased to be effective upon the promulgation of SAFE Circular 37. SAFE Circular 37
requires PRC residents (including PRC individuals and PRC corporate entities) to register with SAFE or its local branches in connection
with their direct or indirect offshore investment activities. SAFE Circular 37 is applicable to our shareholders who are PRC residents
and may be applicable to any offshore acquisitions that we make in the future.

Under SAFE Circular
37, PRC residents who make, or have prior to the implementation of SAFE Circular 37 made, direct or indirect investments in offshore
SPVs will be required to register such investments with the SAFE or its local branches. In addition, any PRC resident who is a
direct or indirect shareholder of a SPV is required to update its filed registration with the local branch of SAFE with respect
to that SPV, to reflect any material change. Moreover, any subsidiary of such SPV in China is required to urge the PRC resident
shareholders to update their registration with the local branch of SAFE. If any PRC shareholder of such SPV fails to make the
required registration or to update the previously filed registration, the subsidiary of such SPV in China may be prohibited from
distributing its profits or the proceeds from any capital reduction, share transfer or liquidation to the SPV, and the SPV may
also be prohibited from making additional capital contributions into its subsidiary in China. On February 13, 2015, the SAFE promulgated
a Notice on Further Simplifying and Improving Foreign Exchange Administration Policy on Direct Investment, or SAFE Circular 13,
which became effective on June 1, 2015. Under SAFE Circular 13, applications for foreign exchange registration of inbound foreign
direct investments and outbound overseas direct investments, including those required under SAFE Circular 37, will be filed with
qualified banks instead of the SAFE. The qualified banks will directly examine the applications and accept registrations under
the supervision of the SAFE.

We cannot assure
you that all of our shareholders that may be subject to SAFE regulations have completed all necessary registrations with the local
SAFE branch or qualified banks as required by SAFE Circular 37, and we cannot assure you that these individuals may continue to
make required filings or updates on a timely manner, or at all. We can provide no assurance that we are or will in the future
continue to be informed of identities of all PRC residents holding direct or indirect interest in our company. Any failure or
inability by such individuals to comply with the SAFE regulations may subject us to fines or legal sanctions, such as restrictions
on our cross-border investment activities or our PRC subsidiaries’ ability to distribute dividends to, or obtain foreign
exchange-denominated loans from, our company or prevent us from making distributions or paying dividends. As a result, our business
operations and our ability to make distributions to you could be materially and adversely affected.

Furthermore, as these
foreign exchange regulations are still relatively new and their interpretation and implementation has been constantly evolving,
it is unclear how these regulations, and any future regulation concerning offshore or cross-border transactions, will be interpreted,
amended and implemented by the relevant government authorities. For example, we may be subject to a more stringent review and
approval process with respect to our foreign exchange activities, such as remittance of dividends and foreign-currency-denominated
borrowings, which may materially and adversely affect our financial condition and results of operations. In addition, if we decide
to acquire a PRC domestic company, we cannot assure you that we or the owners of such company, as the case may be, will be able
to obtain the necessary approvals or complete the necessary filings and registrations required by the foreign exchange regulations.
This may restrict our ability to implement our acquisition strategy and could adversely affect our business and prospects.

As of the date of this
prospectus, to our knowledge, all of our shareholders had registered according to SAFE Circular 37.

We face uncertainty
with respect to indirect transfers of equity interests in PRC resident enterprises by their non-PRC holding companies.

On February 3, 2015,
the State Administration of Taxation of the PRC, or the SAT, issued the Announcement of the State Administration of Taxation on
Several Issues Relating to Enterprise Income Tax on Indirect Transfers of Assets by Non-resident Enterprises, or SAT Bulletin
7, which was partially abolished on December 1, 2017 and December 29, 2017. SAT Bulletin 7 extends its tax jurisdiction to transactions
involving transfer of taxable assets through the offshore transfer of a foreign intermediate holding company. In addition, SAT
Bulletin 7 has introduced safe harbors for internal group restructurings and the purchase and sale of equity through a public
securities market. SAT Bulletin 7 also brings challenges to both foreign transferor and transferee (or other person who is obligated
to pay for the transfer) of taxable assets.

On October 17, 2017,
the SAT issued the Announcement of the State Administration of Taxation on Issues Concerning the Withholding of Non-resident Enterprise
Income Tax at Source, or SAT Bulletin 37, which was partially revised. SAT Bulletin 37 came into effect on December 1, 2017. The
SAT Bulletin 37 further clarifies the practice and procedure of withholding of non-resident enterprise income tax.

Where a non-resident
enterprise transfers taxable assets indirectly by disposing of the equity interests of an overseas holding company, which is an
Indirect Transfer, the non-resident enterprise as either transferor or transferee, or the PRC entity that directly owns the taxable
assets, may report such Indirect Transfer to the relevant tax authority. Using a « substance over form » principle, the
PRC tax authority may disregard the existence of the overseas holding company if it lacks a reasonable commercial purpose and
was established for the purpose of reducing, avoiding or deferring PRC tax. As a result, gains derived from such Indirect Transfer
may be subject to PRC enterprise income tax, and the transferee or other person who is obligated to pay for the transfer is obligated
to withhold the applicable taxes, currently at a rate of 10% for the transfer of equity interests in a PRC resident enterprise.
Both the transferor and the transferee may be subject to penalties under PRC tax laws if the transferee fails to withhold the
taxes and the transferor fails to pay the taxes.

We face uncertainties
as to the reporting and other implications of certain past and future transactions where PRC taxable assets are involved, such
as offshore restructuring, sale of the shares in our offshore subsidiaries and investments. Our company may be subject to filing
obligations or taxed if our company is transferor in such transactions, and may be subject to withholding obligations if our company
is transferee in such transactions, under SAT Bulletin 7 and/or SAT Bulletin 37. For transfer of shares in our company by investors
who are non-PRC resident enterprises, our PRC subsidiaries may be requested to assist in the filing under SAT Bulletin 7 and/or
SAT Bulletin 37. As a result, we may be required to expend valuable resources to comply with SAT Bulletin 7 and/or SAT Bulletin
37 or to request the relevant transferors from whom we purchase taxable assets to comply with these circulars, or to establish
that our company should not be taxed under these circulars, which may have a material adverse effect on our financial condition
and results of operations.

Additional
factors outside of our control related to doing business in China could negatively affect our business.

Additional factors
that could negatively affect our business include a potential significant revaluation of the Renminbi, which may result in an
increase in the cost of producing products in China, labor shortages and increases in labor costs in China as well as difficulties
in moving products manufactured in China out of the country, whether due to port congestion, labor disputes, slowdowns, product
regulations and/or inspections or other factors. Prolonged disputes or slowdowns can negatively impact both the time and cost
of transporting goods. Natural disasters or health pandemics impacting China can also have a significant negative impact on our
business. Further, the imposition of trade sanctions or other regulations against products imported by us from, or the loss of
“normal trade relations” status with, China, could significantly increase our cost of products exported outside of
China and harm our business.

The recent
joint statement by the SEC and the Public Company Accounting Oversight Board, or the PCAOB, proposed rule changes submitted by
Nasdaq, and the Holding Foreign Companies Accountable Act all call for additional and more stringent criteria to be applied to
emerging market companies upon assessing the qualification of their auditors, especially non-U.S. auditors who are not inspected
by the PCAOB. These developments could add uncertainties to our offering.

On April 21, 2020,
SEC Chairman Jay Clayton and PCAOB Chairman William D. Duhnke III, along with other senior SEC staff, released a joint statement
highlighting the risks associated with investing in companies based in or have substantial operations in emerging markets including
China. The joint statement emphasized the risks associated with lack of access for the PCAOB to inspect auditors and audit work
papers in China and higher risks of fraud in emerging markets.

On May 18, 2020,
Nasdaq filed three proposals with the SEC to (i) apply minimum offering size requirement for companies primarily operating in
a “Restrictive Market”, (ii) adopt a new requirement relating to the qualification of management or board of director
for Restrictive Market companies, and (iii) apply additional and more stringent criteria to an applicant or listed company based
on the qualifications of the company’s auditors.

On May 20, 2020,
the U.S. Senate passed the Holding Foreign Companies Accountable Act requiring a foreign company to certify it is not owned or
controlled by a foreign government if the PCAOB is unable to audit specified reports because the company uses a foreign auditor
not subject to PCAOB inspection. If the PCAOB is unable to inspect the company’s auditors for three consecutive years, the
issuer’s securities are prohibited to trade on a national exchange. On December 2, 2020, the U.S. House of Representatives
approved the Holding Foreign Companies Accountable Act. On December 18, 2020, the Holding Foreign Companies Accountable Act was
signed into law.

The lack of access
to the PCAOB inspection in China prevents the PCAOB from fully evaluating audits and quality control procedures of the auditors
based in China. As a result, investors may be deprived of the benefits of such PCAOB inspections. The inability of the PCAOB to
conduct inspections of auditors in China makes it more difficult to evaluate the effectiveness of these accounting firms’
audit procedures or quality control procedures as compared to auditors outside of China that are subject to the PCAOB inspections,
which could cause existing and potential investors in our stock to lose confidence in our audit procedures and reported financial
information and the quality of our financial statements.

Our auditor, the
independent registered public accounting firm that issues the audit report included elsewhere in this prospectus, as an auditor
of companies that are traded publicly in the United States and a firm registered with the PCAOB, is subject to laws in the United
States pursuant to which the PCAOB conducts regular inspections to assess our auditor’s compliance with the applicable professional
standards. Our auditor is headquartered in Manhattan, New York, and has been inspected by the PCAOB on a regular basis with the
last inspection in June 2018. However, the recent developments would add uncertainties to our offering and we cannot assure you
whether Nasdaq or regulatory authorities would apply additional and more stringent criteria to us after considering the effectiveness
of our auditor’s audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency of
resources, geographic reach or experience as it relates to the audit of our financial statements.

Risks Related to our Ordinary Shares
and this Offering

If we fail
to implement and maintain an effective system of internal control, we may be unable to accurately report our operating results,
meet our reporting obligations or prevent fraud.

Prior to this offering,
we were a private company with limited accounting personnel and other resources with which to address our internal controls and
procedures. Our management has not completed an assessment of the effectiveness of our internal control over financial reporting,
and our independent registered public accounting firm has not conducted an audit of our internal control over financial reporting.

In the course of
auditing our consolidated financial statements as of and for the years ended December 31, 2019 and 2018, we and our independent
registered public accounting firm identified two material weaknesses in our internal control over financial reporting as well
as other control deficiencies. As defined in standards established by the Public Company Accounting Oversight Board (United States),
a “material weakness” is a deficiency, or a combination of deficiencies, in internal control over financial reporting,
such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not
be prevented or detected on a timely basis. The material weaknesses identified relate to (i) a lack of accounting staff and resources
with appropriate knowledge of generally accepted accounting principles in the United States (“U.S. GAAP”) and SEC
reporting and compliance requirements; (ii) a lack of independent directors, an audit committee and internal audit function to
establish formal risk assessment process and internal control framework; and (iii) the absence of policies and procedures and
related risk mitigations surrounding our IT policies and procedures and the access to system and data. We are seeking to remediate
these material weaknesses by actively seeking qualified independent directors who possess U.S. GAAP and SEC reporting knowledge,
hiring more qualified accounting personnel and we have started the process of preparing a systematic policies and procedures manual
for our IT processes. We have hired external financial consultants proficient in U.S. GAAP and SEC reporting to assist us with
financial reporting. In addition, our board of directors is currently composed of a majority of independent directors and we have
established an audit committee of our board of directors which will have the responsibilities and authority necessary to comply
with applicable Nasdaq and SEC rules. Our audit committee is chaired by Harry D. Schulman who has extensive
experience in accounting and other senior management roles including chief financial officer of a NYSE-listed company. We also
intend to form an internal audit function and have plans to hire internal auditors to strengthen our overall governance. All internal
auditors will be independent of our operations and will report directly to the audit committee.

Upon completion of
this offering, we will become a public company in the United States subject to the Sarbanes-Oxley Act of 2002. Section 404 of
the Sarbanes-Oxley Act of 2002 will require that we include a report of management on our internal control over financial reporting
in our annual report on Form 20-F beginning with our first required annual report for the prior fiscal year after completion of
this offering. In addition, once we cease to be an “emerging growth company” as such term is defined under the JOBS
Act, our independent registered public accounting firm must attest to and report on the effectiveness of our internal control
over financial reporting. Our management may conclude that our internal control over financial reporting is not effective. Moreover,
even if our management concludes that our internal control over financial reporting is effective, our independent registered public
accounting firm, after conducting its own independent testing, may issue a report that is qualified if it is not satisfied with
our internal controls or the level at which our controls are documented, designed, operated or reviewed, or if it interprets the
relevant requirements differently from us. In addition, after we become a public company, our reporting obligations may place
a significant strain on our management, operational and financial resources and systems for the foreseeable future. We may be
unable to timely complete our evaluation testing and any required remediation.

During the course
of documenting and testing our internal control procedures, in order to satisfy the requirements of Section 404 of the Sarbanes-Oxley
Act of 2002, we may identify other weaknesses and deficiencies in our internal control over financial reporting. In addition,
if we fail to maintain the adequacy of our internal control over financial reporting, as these standards are modified, supplemented
or amended from time to time, we may not be able to conclude on an ongoing basis that we have effective internal control over
financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act of 2002. Generally, if we fail to achieve and maintain
an effective internal control environment, we could suffer material misstatements in our consolidated financial statements and
fail to meet our reporting obligations, which would likely cause investors to lose confidence in our reported financial information.
This could in turn limit our access to capital markets, and harm our results of operations. Additionally, ineffective internal
control over financial reporting could expose us to increased risk of fraud or misuse of corporate assets and subject us to potential
delisting from the stock exchange on which we list, regulatory investigations and civil or criminal sanctions.

There has been
no prior public market for our ordinary shares and an active trading market may never develop or be sustained.

Prior to this offering,
there has been no public market for our ordinary shares. An active trading market for our ordinary shares may never develop following
completion of this offering or, if developed, may not be sustained. The lack of an active trading market may impair the value
of your shares and your ability to sell your shares at the time you wish to sell them. An inactive trading market may also impair
our ability to raise capital by selling our ordinary shares and entering into strategic partnerships or acquiring other complementary
products, technologies or businesses by using our ordinary shares as consideration. In addition, if we fail to satisfy exchange
listing standards, we could be delisted, which would have a negative effect on the price of our ordinary shares.

We expect that the
price of our ordinary shares will fluctuate substantially and you may not be able to sell the shares you purchase in this offering
at or above the initial public offering price.

The initial public
offering price for our ordinary shares sold in this offering is determined by negotiation between the representative of the underwriters
and us. This price may not reflect the market price of our ordinary shares following this offering. In addition, the market price
of our ordinary shares is likely to be highly volatile and may fluctuate substantially due to many factors, including:

· the volume and timing of sales of our products;

· the introduction of new products or product enhancements
by us or others in our industry;

· disputes or other developments with respect to our
or others’ intellectual property rights;

· our ability to develop, obtain regulatory clearance
or approval for, and market new and enhanced products on a timely basis;

· product liability claims or other litigation;

· quarterly variations in our results of operations
or those of others in our industry;

· media exposure of our products or of those of others
in our industry;

· changes in governmental regulations or in reimbursement;

· changes in earnings estimates or recommendations
by securities analysts; and

· general market conditions and other factors, including
factors unrelated to our operating performance or the operating performance of our competitors.

In recent years,
the stock markets generally have experienced extreme price and volume fluctuations that have often been unrelated or disproportionate
to the operating performance of those companies. Broad market and industry factors may significantly affect the market price of
our ordinary shares, regardless of our actual operating performance. These fluctuations may be even more pronounced in the trading
market for our ordinary shares shortly following this offering. If the market price of our ordinary shares after this offering
does not ever exceed the initial public offering price, you may not realize any return on your investment in us and may lose some
or all of your investment.

In addition, in the
past, class action litigation has often been instituted against companies whose securities have experienced periods of volatility
in market price. Securities litigation brought against us following volatility in our stock price, regardless of the merit or
ultimate results of such litigation, could result in substantial costs, which would hurt our financial condition and operating
results and divert management’s attention and resources from our business.

Our stock is
expected to initially trade under $5.00 per ordinary share and thus could be known as a penny stock, subject to certain exceptions.
Trading in penny stocks has certain restrictions and these restrictions could negatively affect the price and liquidity of our
ordinary shares.

Our stock is expected
to initially trade below $5.00 per share. As a result, our stock could be known as a “penny stock”, subject to certain
exceptions, which is subject to various regulations involving disclosures to be given to you prior to the purchase of any penny
stock. The SEC has adopted regulations which generally define a “penny stock” to be any equity security that has a
market price of less than $5.00 per share, subject to certain exceptions. Depending on market fluctuations, our ordinary shares
could be considered to be a “penny stock”, subject to certain exceptions. A penny stock is subject to rules that impose
additional sales practice requirements on broker/dealers who sell these securities to persons other than established members and
accredited investors. For transactions covered by these rules, the broker/dealer must make a special suitability determination
for the purchase of these securities. In addition, a broker/dealer must receive the purchaser’s written consent to the transaction
prior to the purchase and must also provide certain written disclosures to the purchaser. Consequently, the “penny stock”
rules may restrict the ability of broker/dealers to sell our ordinary shares, and may negatively affect the ability of holders
of shares of our ordinary shares to resell them, if the “penny stock” rules apply. These disclosures require you to
acknowledge that you understand the risks associated with buying penny stocks and that you can absorb the loss of your entire
investment. Penny stocks generally do not have a very high trading volume. Consequently, the price of the stock is often volatile
and you may not be able to buy or sell the stock when you want to.

If we fail
to meet applicable listing requirements, Nasdaq may delist our ordinary shares from trading, in which case the liquidity and market
price of our ordinary shares could decline.

Assuming our ordinary
shares are listed on Nasdaq, we cannot assure you that we will be able to meet the continued listing standards of Nasdaq in the
future. If we fail to comply with the applicable listing standards and Nasdaq delists our ordinary shares, we and our shareholders
could face significant material adverse consequences, including:

· a limited availability of market quotations for
our ordinary shares;

· reduced liquidity for our ordinary shares;

· a determination that our ordinary shares are “penny
stock”, which would require brokers trading in our ordinary shares to adhere to more stringent rules and possibly result
in a reduced level of trading activity in the secondary trading market for our ordinary shares;

· a limited amount of news about us and analyst coverage
of us; and

· a decreased ability for us to issue additional equity
securities or obtain additional equity or debt financing in the future.

The National Securities
Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain
securities, which are referred to as “covered securities.” Because we expect that our ordinary shares will be listed
on Nasdaq, such securities will be covered securities. Although the states are preempted from regulating the sale of our securities,
the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding
of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. Further, if we
were no longer listed on Nasdaq, our securities would not be covered securities and we would be subject to regulations in each
state in which we offer our securities.

If you purchase
our ordinary shares in this offering, you will incur immediate and substantial dilution in the book value of your shares.

Investors purchasing
our ordinary shares in this offering will pay a price per share that substantially exceeds the pro forma as adjusted net tangible
book value per share. As a result, investors purchasing ordinary shares in this offering will incur immediate dilution of $3.03
per share, representing the difference between our assumed initial public offering price of $4.00 per share and our pro forma
as adjusted net tangible book value of $0.97 per share as of June 30, 2020. For more information on the dilution you may experience
as a result of investing in this offering, see “Dilution.”

A significant
portion of our total outstanding shares are restricted from immediate resale but may be sold into the market in the near future.
This could cause the market price of our ordinary shares to drop significantly, even if our business is doing well.

Sales of a substantial
number of our ordinary shares in the public market could occur at any time. These sales, or the perception in the market that
these sales may occur, could result in a decrease in the market price of our ordinary shares. Immediately after this offering,
we will have 25,250,000 outstanding ordinary shares, based on the number of ordinary shares outstanding as of June 30, 2020, assuming
no exercise of the underwriters’ over-allotment option. This includes the shares that we are selling in this offering, which may
be resold in the public market immediately without restriction, unless purchased by our affiliates or existing shareholders. Of
that amount, 19,000,000 shares are currently restricted as a result of securities laws and/or lock-up agreements, but will be
able to be sold after the closing of this offering, subject to securities laws and/or lock-up agreements. If held by one of our
affiliates, the resale of those securities will be subject to volume limitations under Rule 144 of the Securities Act. See « Shares
Eligible for Future Sale. »

Our directors,
officers and principal shareholders have significant voting power and may take actions that may not be in the best interests of
our other shareholders.

As of the date of
this prospectus, our directors, officers and principal shareholders holding 5% or more of our ordinary shares, collectively, control
approximately 67.13% of our ordinary shares. After this offering, our directors, officers and principal shareholders holding 5%
or more of our ordinary shares, collectively, will control approximately 50.51% of our outstanding ordinary shares. As a result,
these shareholders, if they act together, will be able to control the management and affairs of our company and most matters requiring
shareholder approval, including the election of directors and approval of significant corporate transactions. The interests of
these shareholders may not be the same as or may even conflict with your interests. For example, these shareholders could attempt
to delay or prevent a change in control of us, even if such change in control would benefit our other shareholders, which could
deprive our shareholders of an opportunity to receive a premium for their ordinary shares as part of a sale of us or our assets,
and might affect the prevailing market price of our ordinary shares due to investors’ perceptions that conflicts of interest may
exist or arise. As a result, this concentration of ownership may not be in the best interests of our other shareholders.

We will have
broad discretion in the use of proceeds of this offering designated for working capital and general corporate purposes.

We intend to use
the net proceeds from this offering for strengthening sales and marketing, research and development, and working capital and general
corporate purposes, including future capital expenditures, such as the construction of the cloud computing facility in Guiyang,
China, and increasing our liquidity. Within those categories, we have not determined the specific allocation of the net proceeds
of this offering. Our management will have broad discretion over the use and investment of the net proceeds of this offering within
those categories. Accordingly, investors in this offering have only limited information concerning management’s specific intentions
and will need to rely upon the judgment of our management with respect to the use of proceeds.

We expect to
incur significant additional costs as a result of being a public company, which may materially and adversely affect our business,
financial condition and results of operations.

Upon completion of
this offering, we expect to incur costs associated with corporate governance requirements that will become applicable to us as
a public company, including rules and regulations of the SEC, under the Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform
and Consumer Protection Act of 2010, and the Exchange Act, as well as the rules of the Nasdaq. These rules and regulations are
expected to significantly increase our accounting, legal and financial compliance costs and make some activities more time-consuming.
We also expect these rules and regulations to make it more expensive for us to obtain and maintain directors’ and officers’ liability
insurance. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our board of directors
or as executive officers. Accordingly, increases in costs incurred as a result of becoming a publicly traded company may materially
and adversely affect our business, financial condition and results of operations.

Our disclosure
controls and procedures may not prevent or detect all errors or acts of fraud.

Upon the closing
of this offering, we will become subject to the periodic reporting requirements of the Exchange Act. We will design our disclosure
controls and procedures to provide reasonable assurance that information we must disclose in reports we file or submit under the
Exchange Act is accumulated and communicated to management, and recorded, processed, summarized and reported within the time periods
specified in the rules and forms of the SEC. We believe that any disclosure controls and procedures, no matter how well-conceived
and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

These inherent limitations
include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or
mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people
or by an unauthorized override of the controls. Accordingly, because of the inherent limitations in our control system, misstatements
due to error or fraud may occur and not be detected.

Because we
do not anticipate paying any cash dividends on our capital stock in the foreseeable future, capital appreciation, if any, will
be your sole source of gain.

We have never declared
or paid cash dividends. We currently intend to retain all of our future earnings, if any, to finance the growth and development
of our business. As a result, capital appreciation, if any, of our ordinary shares will be your sole source of gain for the foreseeable
future.

Securities
analysts may not publish favorable research or reports about our business or may publish no information at all, which could cause
our stock price or trading volume to decline.

If a trading market
for our ordinary shares develops, the trading market will be influenced to some extent by the research and reports that industry
or financial analysts publish about us and our business. We do not control these analysts. As a newly public company, we may be
slow to attract research coverage and the analysts who publish information about our ordinary shares will have had relatively
little experience with us or our industry, which could affect their ability to accurately forecast our results and could make
it more likely that we fail to meet their estimates. In the event we obtain securities or industry analyst coverage, if any of
the analysts who cover us provide inaccurate or unfavorable research or issue an adverse opinion regarding our stock price, our
stock price could decline. If one or more of these analysts cease coverage of us or fail to publish reports covering us regularly,
we could lose visibility in the market, which in turn could cause our stock price or trading volume to decline and result in the
loss of all or a part of your investment in us.

The approval
of the China Securities Regulatory Commission, or the CSRC, may be required in connection with this offering under PRC law.

The M&A Rules
purport to require offshore SPVs that are controlled by PRC companies or individuals and that have been formed for the purpose
of seeking a public listing on an overseas stock exchange through acquisitions of PRC domestic companies or assets to obtain CSRC
approval prior to publicly listing their securities on an overseas stock exchange. In September 2006, the CSRC published a notice
on its official website specifying documents and materials required to be submitted to it by a SPV seeking CSRC approval of its
overseas listings. The interpretation and application of the regulations remain unclear, and this offering may ultimately require
approval from the CSRC. If CSRC approval is required, it is uncertain whether it would be possible for us to obtain the approval,
and any failure to obtain or delay in obtaining CSRC approval for this offering would subject us to sanctions imposed by the CSRC
and other PRC regulatory agencies.

Our PRC legal counsel
has advised us that, based on its understanding of the current PRC laws and regulations, we will not be required to submit an
application to the CSRC for the approval of the listing and trading of our ordinary shares on Nasdaq because (i) we established
our WFOE by means of direct investment and not through a merger or acquisition of the equity or assets of a “PRC domestic
company” as such term is defined under the M&A Rules; and (ii) no provision in the M&A Rules classifies the contractual
arrangements under the Contractual Arrangements as a type of acquisition transaction falling under the M&A Rules.

However, our PRC
legal counsel has further advised us that there remains some uncertainty as to how the M&A Rules will be interpreted or implemented
in the context of an overseas offering, and its opinions summarized above are subject to any new laws, rules and regulations or
detailed implementations and interpretations in any form relating to the M&A Rules. We cannot assure you that relevant PRC
government agencies, including the CSRC, would reach the same conclusion as our PRC legal counsel, and hence we may face regulatory
actions or other sanctions from the CSRC or other PRC regulatory agencies. These regulatory agencies may impose fines and penalties
on our operations in China, limit our ability to pay dividends outside of China, limit our operating privileges in China, delay
or restrict the repatriation of the proceeds from this offering into China or take other actions that could have a material adverse
effect on our business, financial condition, results of operations and prospects, as well as the trading price of the ordinary
shares. The CSRC or other PRC regulatory agencies also may take actions requiring us, or making it advisable for us, to halt this
offering before settlement and delivery of the ordinary shares offered hereby. Consequently, if you engage in market trading or
other activities in anticipation of and prior to settlement and delivery, you do so at the risk that settlement and delivery may
not occur. In addition, if the CSRC or other regulatory agencies later promulgate new rules or explanations requiring that we
obtain their approvals for this offering, we may be unable to obtain a waiver of such approval requirements, if and when procedures
are established to obtain such a waiver. Any uncertainties and/or negative publicity regarding such approval requirement could
have a material adverse effect on the trading price of the ordinary shares.

Recently introduced
economic substance legislation of the Cayman Islands may impact us and our operations.

The Cayman Islands,
together with several other non-European Union jurisdictions, has recently introduced legislation aimed at addressing concerns
raised by the Council of the European Union as to offshore structures engaged in certain activities which attract profits without
real economic activity. With effect from January 1, 2019, the International Tax Co-operation (Economic Substance) Law, 2018, or
the Substance Law, and issued Regulations and Guidance Notes came into force in the Cayman Islands introducing certain economic
substance requirements for “relevant entities” which are engaged in certain “relevant activities,” which
in the case of exempted companies incorporated before January 1, 2019, will apply in respect of financial years commencing July
1, 2019 and onwards. A “relevant entity” includes an exempted company incorporated in the Cayman Islands, as is Infobird
Cayman; however, it does not include an entity that is tax resident outside of the Cayman Islands. Accordingly, for so long as
Infobird Cayman is a tax resident outside of the Cayman Islands, we are not required to satisfy the economic substance test set
out in the Substance Law. Although it is presently anticipated that the Substance Law will have little material impact on us and
our operations, as the legislation is new and remains subject to further clarification and interpretation, it is not currently
possible to ascertain the precise impact of these legislative changes on us and our operations.

You may face
difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because
we are incorporated under Cayman Islands law.

We are an exempted
company incorporated under the laws of the Cayman Islands. Our corporate affairs are governed by our memorandum and articles of
association, the Companies Act (2021 Revision) of the Cayman Islands and the common law of the Cayman Islands. The rights of shareholders
to take action against our directors, actions by our minority shareholders and the fiduciary duties of our directors to us under
Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands
is derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from the common law of England
and Wales, the decisions of whose courts are of persuasive authority, but are not binding, on a court in the Cayman Islands. The
rights of our shareholders and the fiduciary duties of our directors under Cayman Islands law are not as clearly established as
they would be under statutes or judicial precedent in some jurisdictions in the United States. In particular, the Cayman Islands
have a less developed body of securities laws than the United States. Some U.S. states, such as Delaware, have more fully developed
and judicially interpreted bodies of corporate law than the Cayman Islands. In addition, Cayman Islands companies may not have
standing to initiate a shareholder derivative action in a federal court of the United States. Moreover, while under Delaware law,
controlling shareholders owe fiduciary duties to the companies they control and their minority shareholders, under Cayman Islands
law, our controlling shareholders do not owe any such fiduciary duties to our company or to our minority shareholders. Accordingly,
our controlling shareholders may exercise their powers as shareholders, including the exercise of voting rights in respect of
their shares, in such manner as they think fit.

Shareholders of
Cayman Islands exempted companies like us have no general rights under Cayman Islands law to inspect corporate records (other
than the memorandum and articles of association) or to obtain copies of lists of shareholders of these companies. Our amended
and restated memorandum and articles of association, or our post-offering memorandum and articles of association, will become
effective and replace our current memorandum and articles of association in its entirety immediately prior to the completion of
this offering. Our directors have discretion under our post-offering memorandum and articles of association to determine whether
or not, and under what conditions, our corporate records may be inspected by our shareholders, but are not obliged to make them
available to our shareholders unless required by the Companies Act of the Cayman Islands or other applicable law or authorized
by the directors or by ordinary resolution. This may make it more difficult for you to obtain the information needed to establish
any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy contest.

Certain corporate
governance practices in the Cayman Islands, which is our home country, differ significantly from requirements for companies incorporated
in other jurisdictions such as the United States. Currently, we do not plan to rely on home country practices with respect
to any corporate governance matter. To the extent we choose to follow home country practices with respect to corporate governance
matters, our shareholders may be afforded less protection than they otherwise would under rules and regulations applicable to
U.S. domestic issuers.

As a result of all
of the above, our public shareholders may have more difficulty in protecting their interests in the face of actions taken by our
management, members of our board of directors or controlling shareholders than they would as public shareholders of a company
incorporated in the United States. For a discussion of significant differences between the provisions of the Companies Act of
the Cayman Islands and the laws applicable to companies incorporated in the United States and their shareholders, see “Description
of Share Capital and Governing Documents — Comparison of Cayman Islands Corporate Law and U.S. Corporate Law.”

Certain judgments
obtained against us by our shareholders may not be enforceable.

We are a Cayman Islands
company and substantially all of our assets are located outside of the United States. Substantially all of our current operations
are conducted in China. In addition, most of our current directors and officers are nationals and residents of countries other
than the United States. Substantially all of the assets of these persons are located outside the United States. As a result, it
may be difficult or impossible for you to bring an action against us or against these individuals in the United States in the
event that you believe that your rights have been infringed under the U.S. federal securities laws or otherwise. Even if you are
successful in bringing an action of this kind, the laws of the Cayman Islands and of China may render you unable to enforce a
judgment against our assets or the assets of our directors and officers.

We are an emerging
growth company within the meaning of the Securities Act and may take advantage of certain reduced reporting requirements.

We are an « emerging
growth company, » as defined in the JOBS Act, and we may take advantage of certain exemptions from requirements applicable
to other public companies that are not emerging growth companies, including, most significantly, not being required to comply
with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 for so long as we remain an emerging
growth company. As a result, if we elect not to comply with such auditor attestation requirements, our investors may not have
access to certain information they may deem important.

The JOBS Act also
provides that an emerging growth company does not need to comply with any new or revised financial accounting standards until
such date that a private company is otherwise required to comply with such new or revised accounting standards. We do not plan
to « opt out » of such exemptions afforded to an emerging growth company. As a result of this election, our financial
statements may not be comparable to those of companies that comply with public company effective dates.

We qualify
as a foreign private issuer and, as a result, we will not be subject to U.S. proxy rules and will be subject to Exchange Act reporting
obligations that permit less detailed and less frequent reporting than that of a U.S. domestic public company.

Upon the closing
of this offering, we will report under the Exchange Act as a non-U.S. company with foreign private issuer status. Because
we qualify as a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the Exchange Act that
are applicable to U.S. domestic public companies, including (i) the sections of the Exchange Act regulating the solicitation
of proxies, consents or authorizations in respect of a security registered under the Exchange Act; (ii) the sections of the
Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders
who profit from trades made in a short period of time; and (iii) the rules under the Exchange Act requiring the filing with
the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specified information, or current
reports on Form 8-K upon the occurrence of specified significant events. In addition, our officers, directors and principal
shareholders are exempt from the reporting and “short-swing” profit recovery provisions of Section 16 of the
Exchange Act and the rules thereunder. Therefore, our shareholders may not know on a timely basis when our officers, directors
and principal shareholders purchase or sell our ordinary shares. In addition, foreign private issuers are not required to file
their annual report on Form 20-F until one hundred twenty (120) days after the end of each fiscal year, while U.S. domestic
issuers that are accelerated filers are required to file their annual report on Form 10-K within seventy-five (75) days after
the end of each fiscal year. Foreign private issuers also are exempt from Regulation Fair Disclosure, aimed at preventing issuers
from making selective disclosures of material information. As a result of the above, you may not have the same protections afforded
to shareholders of companies that are not foreign private issuers.

If we lose our status
as a foreign private issuer, we would be required to comply with the Exchange Act reporting and other requirements applicable
to U.S. domestic issuers, which are more detailed and extensive than the requirements for foreign private issuers. We may also
be required to make changes in our corporate governance practices in accordance with various SEC and Nasdaq rules. The regulatory
and compliance costs to us under U.S. securities laws if we are required to comply with the reporting requirements applicable
to a U.S. domestic issuer may be significantly higher than the cost we would incur as a foreign private issuer. As a result, we
expect that a loss of foreign private issuer status would increase our legal and financial compliance costs and would make some
activities highly time consuming and costly. We also expect that if we were required to comply with the rules and regulations
applicable to U.S. domestic issuers, it would make it more difficult and expensive for us to obtain and maintain directors’
and officers’ liability insurance, and we may be required to accept reduced coverage or incur substantially higher costs
to obtain coverage. These rules and regulations could also make it more difficult for us to attract and retain qualified members
of our board of directors.

As a foreign
private issuer, we are permitted to adopt certain home country practices in relation to corporate governance matters that differ
significantly from Nasdaq corporate governance listing standards. These practices may afford less protection to shareholders than
they would enjoy if we complied fully with corporate governance listing standards.

As a foreign private
issuer, we are permitted to take advantage of certain provisions in the Nasdaq rules that allow us to follow our home country
law for certain governance matters. Certain corporate governance practices in our home country, the Cayman Islands, may differ
significantly from corporate governance listing standards. Currently, we do not plan to rely on home country practices with respect
to our corporate governance after we complete this offering. If we choose to follow home country practices in the future, our
shareholders may be afforded less protection than they would otherwise enjoy under the Nasdaq corporate governance listing standards
applicable to U.S. domestic issuers.

There can be
no assurance that we will not be a passive foreign investment company, or PFIC, for U.S. federal income tax purposes for any taxable
year, which could result in adverse U.S. federal income tax consequences to U.S. holders of our ordinary shares.

A non-U.S. corporation
will be a PFIC for any taxable year if either (i) at least 75% of its gross income for such year consists of certain types of
« passive » income; or (ii) at least 50% of the value of its assets (based on an average of the quarterly values of the
assets) during such year is attributable to assets that produce passive income or are held for the production of passive income,
or the asset test. Based on our current and expected income and assets (taking into account the expected cash proceeds and our
anticipated market capitalization following this offering), we do not presently expect to be a PFIC for the current taxable year
or the foreseeable future. However, no assurance can be given in this regard because the determination of whether we are or will
become a PFIC is a fact-intensive inquiry made on an annual basis that depends, in part, upon the composition of our income and
assets. In addition, there can be no assurance that the Internal Revenue Service, or IRS, will agree with our conclusion or that
the IRS would not successfully challenge our position. Fluctuations in the market price of our ordinary shares may cause us to
become a PFIC for the current or subsequent taxable years because the value of our assets for the purpose of the asset test may
be determined by reference to the market price of our ordinary shares. The composition of our income and assets may also be affected
by how, and how quickly, we use our liquid assets and the cash raised in this offering. If we were to be or become a PFIC for
any taxable year during which a U.S. Holder holds our ordinary shares, certain adverse U.S. federal income tax consequences could
apply to such U.S. Holder. See “Taxation— Passive Foreign Investment Company Consequences.”

We may lose
our foreign private issuer status in the future, which could result in significant additional costs and expenses.

As discussed above,
we are a foreign private issuer, and therefore, we are not required to comply with all of the periodic disclosure and current
reporting requirements of the Exchange Act. The determination of foreign private issuer status is made annually on the last business
day of an issuer’s most recently completed second fiscal quarter. We would lose our foreign private issuer status if, for
example, more than 50% of our ordinary shares are directly or indirectly held by residents of the United States and we fail to
meet additional requirements necessary to maintain our foreign private issuer status. If we lose our foreign private issuer status
on this date, we will be required to file with the SEC periodic reports and registration statements on U.S. domestic issuer forms,
which are more detailed and extensive than the forms available to a foreign private issuer. We will also have to mandatorily comply
with U.S. federal proxy requirements, and our officers, directors and principal shareholders will become subject to the short-swing
profit disclosure and recovery provisions of Section 16 of the Exchange Act. In addition, we will lose our ability to rely upon
exemptions from certain corporate governance requirements under the Nasdaq rules. As a U.S. listed public company that is not
a foreign private issuer, we will incur significant additional legal, accounting and other expenses that we will not incur as
a foreign private issuer, and accounting, reporting and other expenses in order to maintain a listing on a U.S. securities exchange.

SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains
forward-looking statements that involve substantial risks and uncertainties. In some cases, you can identify forward-looking statements
by the words “may,” “might,” “will,” “could,” “would,” “should,”
“expect,” “intend,” “plan,” “goal,” “objective,” “anticipate,”
“believe,” “estimate,” “predict,” “potential,” “continue” and “ongoing,”
or the negative of these terms, or other comparable terminology intended to identify statements about the future. These statements
involve known and unknown risks, uncertainties and other important factors that may cause our actual results, levels of activity,
performance or achievements to be materially different from the information expressed or implied by these forward-looking statements.
The forward-looking statements and opinions contained in this prospectus are based upon information available to us as of the
date of this prospectus and, while we believe such information forms a reasonable basis for such statements, such information
may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into,
or review of, all potentially available relevant information. Forward-looking statements include statements about:

· timing of the development of future business;

· capabilities of our business operations;

· expected future economic performance;

· competition in our market;

· continued market acceptance of our services and products;

· protection of our intellectual property rights;

· changes in the laws that affect our operations;

· inflation and fluctuations in foreign currency exchange rates;

· our ability to obtain and maintain all necessary government certifications, approvals, and/or
licenses to conduct our business;

· continued development of a public trading market for our securities;

· the cost of complying with current and future governmental regulations and the impact of
any changes in the regulations on our operations;

· managing our growth effectively;

· projections of revenue, earnings, capital structure and other financial items;

· fluctuations in operating results;

· dependence on our senior management and key employees; and

· other factors set forth under “Risk Factors.”

You should refer
to the section titled “Risk Factors” for a discussion of important factors that may cause our actual results to differ
materially from those expressed or implied by our forward-looking statements. As a result of these factors, we cannot assure you
that the forward-looking statements in this prospectus will prove to be accurate. Furthermore, if our forward-looking statements
prove to be inaccurate, the inaccuracy may be material. In light of the significant uncertainties in these forward-looking statements,
you should not regard these statements as a representation or warranty by us or any other person that we will achieve our objectives
and plans in any specified time frame, or at all. We undertake no obligation to publicly update any forward-looking statements,
whether as a result of new information, future events or otherwise, except as required by law.

You should read this
prospectus and the documents that we reference in this prospectus and have filed as exhibits to the registration statement, of
which this prospectus forms a part, completely and with the understanding that our actual future results may be materially different
from what we expect. We qualify all of our forward-looking statements by these cautionary statements.

INDUSTRY AND MARKET
DATA

This prospectus includes
statistical and other industry and market data that we obtained from industry publications and research, surveys and studies conducted
by third parties, as well estimates by our management based on such data. The market data and estimates used in this prospectus
involve a number of assumptions and limitations, and you are cautioned not to give undue weight to such data and estimates. While
we believe that the information from these industry publications, surveys and studies is reliable, the industry in which we operate
is subject to a high degree of uncertainty and risk due to a variety of important factors, including those described in the section
titled “Risk Factors.” These and other factors could cause results to differ materially from those expressed in the
estimates made by the independent parties and by us.

USE OF PROCEEDS

We estimate that the
net proceeds from the sale of 6,250,000 ordinary shares in this offering will be approximately $22,330,241 after deducting the
underwriting discounts and commissions, non-accountable expense allowance and estimated offering expenses payable by us, based
on the assumed initial public offering price of $4.00 per ordinary share. If the underwriters exercise their over-allotment option
in full, we estimate that the net proceeds to us from this offering will be approximately $25,817,741, after deducting the underwriting
discounts and commissions, non-accountable expense allowance and estimated offering expenses payable by us.

Each $1.00 increase
(decrease) in the assumed initial public offering price of $4.00 per share would increase (decrease) the net proceeds to us from
this offering by $5,750,000, assuming that the number of ordinary shares offered by us, as set forth on the cover page of this
prospectus, remains the same, and after deducting the underwriting discounts and commissions, non-accountable expense allowance
and estimated offering expenses payable by us. An increase (decrease) of 1.0 million in the number of ordinary shares we are offering
would increase (decrease) the net proceeds to us from this offering by $3,680,000, assuming the assumed initial public offering
price remains the same, and after deducting the underwriting discounts and commissions, non-accountable expense allowance and
estimated offering expenses payable by us.

The primary purposes
of this offering are to create a public market for our shares for the benefit of all shareholders, retain talented employees,
and obtain additional capital. We plan to use the net proceeds of this offering as follows:

· approximately 50% for strengthening sales and marketing;
· approximately 24% for research and development; and
· the remainder for working capital and general corporate purposes,
including future capital expenditures, such as the construction of the cloud computing facility in Guiyang, China, and increasing
our liquidity.

This expected use
of the net proceeds from this offering represents our intentions based upon our current plans and prevailing business conditions,
which could change in the future as our plans and prevailing business conditions evolve. As a result, our management will retain
broad discretion over the allocation of the net proceeds from this offering and we reserve the right to change the use of proceeds
that we presently anticipate and describe herein.

Pending any use described
above, we plan to invest the net proceeds in short-term, interest-bearing, debt instruments.

We have agreed with
the underwriters in this offering to establish an escrow account in the United States and to fund such account with $600,000 from
this offering that may be utilized by the underwriters to fund any bona fide indemnification claims of the underwriters arising
during a twenty-four (24) month period following the closing of this offering. All funds that are not subject to an indemnification
claim will be returned to us after the applicable period expires.

The net proceeds
from this offering must be remitted to China before we will be able to use the funds to grow our business. The procedure to remit
funds may take several months after completion of this offering, and we will be unable to use the offering proceeds in China until
remittance is completed. See “Risk Factors” for further information.

DIVIDEND POLICY

We have never declared
or paid a dividend, and we do not anticipate declaring or paying dividends in the foreseeable future. We intend to retain all
available funds and any future earnings to fund the development and expansion of our business.

We are a holding
company incorporated in the Cayman Islands. We may rely on dividends from our subsidiaries in the PRC for our cash requirements,
including any payment of dividends to our shareholders. PRC and Hong Kong regulations may restrict the ability of our PRC and
Hong Kong subsidiaries to pay dividends to us.

CAPITALIZATION

The following table
sets forth our capitalization as of June 30, 2020 on:

· an actual basis; and

· a pro forma as adjusted basis to give effect to
the sale of 6,250,000 ordinary shares in this offering at the assumed initial public offering price of $4.00 per ordinary
share after deducting the underwriting discounts and commissions, non-accountable expense allowance and estimated offering
expenses payable by us, assuming the underwriters do not exercise the over-allotment option.

You should read this
information together with our audited consolidated financial statements appearing elsewhere in this prospectus and the information
set forth under the sections titled “Selected Consolidated Financial Data,” “Exchange Rate Information,”
“Use of Proceeds” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

As
of June 30, 2020
Actual Pro
Forma As
Adjusted (1)
(Unaudited)
Ordinary
shares, $0.001 par value per share: 50,000,000 shares authorized; 19,000,000 shares issued and outstanding; 25,250,000 shares
issued and outstanding pro forma
$ 19,000 $ 25,250
Additional paid-in capital 5,852,089 28,176,080
Statutory reserves 107,735 107,735
Accumulated deficit (1,080,715 ) (1,080,715 )
Accumulated other comprehensive loss (29,281 ) (29,281 )
Total equity attributable to Infobird Co.,
Ltd
4,868,828 27,199,069
Noncontrolling interests 238,394 238,394
Total equity 5,107,222 27,437,463
Total capitalization $ 5,107,222 $ 27,437,463

(1) Reflects the sale
of ordinary shares in this offering at an assumed initial public offering price of $4.00 per share, and after deducting the underwriting
discounts and commissions, non-accountable expense allowance and estimated offering expenses payable by us. The pro forma as adjusted
information is illustrative only, and we will adjust this information based on the actual initial public offering price and other
terms of this offering determined at pricing. Additional paid-in capital reflects the net proceeds we expect to receive, after
deducting the underwriting discounts and commissions (7%), non-accountable expense allowance (1%) and estimated offering expenses
payable by us ($669,759). We estimate that such net proceeds will be approximately $22,330,241. For an itemization of an estimation
of the total offering expenses payable by us, see “Expenses Related to this Offering”.

Each $1.00 increase
(decrease) in the assumed initial public offering price of $4.00 per ordinary share would increase (decrease) the pro forma as
adjusted amount of total capitalization by $5,750,000, assuming that the number of ordinary shares offered by us, as set forth
on the cover page of this prospectus, remains the same, and after deducting underwriting discounts and commissions, non-accountable
expense allowance and estimated offering expenses payable by us. An increase (decrease) of 1.0 million in the number of ordinary
shares offered by us, as set forth on the cover page of this prospectus, would increase (decrease) the pro forma as adjusted amount
of total capitalization by $3,680,000, assuming no change in the assumed initial public offering price per ordinary share as set
forth on the cover page of this prospectus.

DILUTION

If you invest in
our ordinary shares in this offering, your interest will be immediately diluted to the extent of the difference between the initial
public offering price per ordinary share in this offering and the net tangible book value per ordinary share after this offering.
Dilution results from the fact that the initial public offering price per ordinary share is substantially in excess of the net
tangible book value per ordinary share. As of June 30, 2020, we had a historical net tangible book value of $2,208,833, or $0.12
per ordinary share. Our net tangible book value per share represents total tangible assets less total liabilities, all divided
by the number of ordinary shares outstanding as of June 30, 2020

After giving effect
to the sale of ordinary shares in this offering at the assumed initial public offering price of $4.00 per ordinary share, we will
have 25,250,000 ordinary shares outstanding, and after deducting the underwriting discounts and commissions, non-accountable expense
allowance and estimated offering expenses payable by us, our pro forma as adjusted net tangible book value at June 30, 2020 would
have been $24,539,074, or $0.97 per ordinary share. This represents an immediate increase in pro forma as adjusted net tangible
book value of $0.85 per ordinary share to existing investors and immediate dilution of $3.03 per ordinary share to new investors.
The following table illustrates this dilution to new investors purchasing ordinary shares in this offering:

Post-
Offering
(1)
Full
Exercise
of Over-
allotment

Option(2)
Assumed initial public offering price
per ordinary share
$ 4.00 $ 4.00
Net tangible book value per ordinary share as of June 30, 2020 $ 0.12 $ 0.12
Increase in pro forma as adjusted net tangible book
value per ordinary share attributable to new investors purchasing ordinary shares in this offering
$ 0.85 $ 0.95
Pro forma as adjusted net tangible book value per
ordinary share after this offering
$ 0.97 $ 1.07
Dilution per ordinary share to new investors in
this offering
$ 3.03 $ 2.93

(1) Assumes gross proceeds
from the offering of 6,250,000 ordinary shares, and assumes that the underwriters’ over-allotment option has not
been exercised.

(2) Assumes gross proceeds
from the offering of 7,187,500 ordinary shares, and assumes that the underwriters’ over-allotment option has been
exercised in full.

Each $1.00 increase
(decrease) in the assumed initial public offering price of $4.00 per ordinary share would increase (decrease) our pro forma as
adjusted net tangible book value as of June 30, 2020 after this offering by approximately $0.23 per ordinary share, and would
increase (decrease) dilution to new investors by $0.77 per ordinary share, assuming that the number of ordinary shares offered
by us, as set forth on the cover page of this prospectus, remains the same, and after deducting the underwriting discounts and
commissions, non-accountable expense allowance and estimated offering expenses payable by us. An increase (decrease) of 1.0 million
ordinary shares in the number of ordinary shares we are offering would increase (decrease) our pro forma as adjusted net tangible
book value as of June 30, 2020 after this offering by approximately $0.11 per ordinary share, and would decrease (increase) dilution
to new investors by approximately $0.11 per ordinary share, assuming the assumed initial public offering price per ordinary share,
as set forth on the cover page of this prospectus remains the same, and after deducting the estimate underwriting discounts and
commissions, non-accountable expense allowance and estimated offering expenses payable by us. The pro forma as adjusted information
is illustrative only, and we will adjust this information based on the actual initial public offering price and other terms of
this offering determined at pricing.

If the underwriters
exercise their over-allotment option in full, the pro forma as adjusted net tangible book value per ordinary share after this
offering would be $1.07 per share, the increase in net tangible book value per ordinary share to existing shareholders would be
$0.95 per share, and the immediate dilution in net tangible book value per ordinary share to new investors in this offering would
be $2.93 per share.

The table and discussion
above is based on 19,000,000 ordinary shares outstanding as of June 30, 2020.

To the extent that
we issue additional ordinary shares in the future, there will be further dilution to new investors participating in this offering.

EXCHANGE RATE INFORMATION

Our business is primarily
conducted in China, and the financial records of our subsidiaries in China are maintained in RMB, their functional currency. However,
we use the U.S. dollar as our reporting and functional currency; therefore, reports made to shareholders will include current
period amounts translated into U.S. dollars using the then-current exchange rates, for the convenience of the readers. Our consolidated
financial statements have been translated into U.S. dollars in accordance with ASC Topic 830, “Foreign Currency Matters.”
The financial information is first prepared in RMB and then is translated into U.S. dollars at period-end exchange rates as to
assets and liabilities and average exchange rates as to statements of income. Equity accounts are translated at their historical
exchange rates when the equity transactions occurred. Translation adjustments resulting from this process are included in accumulated
other comprehensive income (loss). Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated
in a currency other than the functional currency are included in the results of operations as incurred. The balance sheet amounts,
with the exception of equity at June 30, 2020 and December 31, 2019, were translated at RMB 7.0651 and RMB 6.9618, respectively.
The equity accounts were stated at their historical rate. The average translation rates applied to statement of income accounts
for the six months ended June 30, 2020 and 2019 were RMB 7.0322 and RMB 6.7836 to $1.00, respectively. Cash flows were also translated
at average translation rates for the periods, therefore, amounts reported on the statements of cash flows will not necessarily
agree with changes in the corresponding balances on the consolidated balance sheets.

We make no representation
that any RMB or U.S. dollar amounts could have been, or could be, converted into U.S. dollars or RMB, as the case may be, at any
particular rate, or at all. The PRC government imposes control over its foreign currency reserves in part through direct regulation
of the conversion of RMB into foreign exchange and through restrictions on foreign trade. We do not currently engage in currency
hedging transactions.

With respect to amounts
not recorded in our consolidated financial statements included elsewhere in this prospectus, unless otherwise stated, all translations
from RMB to U.S. dollars were made at RMB 7.0651 to $1.00, the noon buying rate on June 30, 2020, as set forth in the H.10 statistical
release of the Board of Governors of the Federal Reserve System. We make no representation that the RMB or U.S. dollar amounts
referred to in this prospectus could have been or could be converted into U.S. dollars or RMB, as the case may be, at any particular
rate or at all.

CORPORATE HISTORY
AND STRUCTURE

Corporate History and Structure

Infobird Co., Ltd,
or Infobird Cayman, is a holding company incorporated on March 26, 2020 under the laws of the Cayman Islands. We have no substantive
operations other than holding all of the outstanding share capital of Infobird International Limited, or Infobird HK, which was
established in Hong Kong on April 21, 2020. Infobird HK is also a holding company holding all of the outstanding equity of Infobird
Digital Technology (Beijing) Co., Ltd, or Infobird WFOE, which was established on May 20, 2020 under the laws of the PRC.

We, through our variable
interest entity, or VIE, Beijing Infobird Software Co., Ltd, or Infobird Beijing, a PRC limited liability company, and through
its subsidiaries, principally engage in developing and providing customer engagement cloud-based services. The officers of Infobird
Beijing are (i) Yimin Wu, chairman of the board of directors and the chief executive officer of each of Infobird Beijing and Infobird
Cayman; (ii) Hsiaochien Tseng, executive vice president of each of Infobird Beijing and Infobird Cayman; and (iii) Chunhsiang
Chen, vice president of Infobird Beijing and chief technology officer and vice president of Infobird Cayman. The board of directors
of Infobird Beijing consists of three individuals: (i) Yimin Wu; (ii) Bing Weng, a shareholder of Infobird Beijing and the sole
director and shareholder of OmniConnect Limited, one of Infobird Cayman’s principal shareholders; and (iii) Dongliang Jiang,
one of Infobird Cayman’s directors and the sole director and shareholder of Orbitchannel Limited, one of Infobird Cayman’s
principal shareholders.

Infobird Beijing,
a PRC limited liability company, was established on October 26, 2001 under the laws of the PRC. On October 17, 2013, Infobird
Beijing established a 90.18% owned subsidiary, Guiyang Infobird Cloud Computing Co., Ltd, or Infobird Guiyang, a PRC limited liability
company, while Shengmin Wu, the brother of Yimin Wu, owns 0.82% and Lanlan Luo, an unrelated third party, owns 9.00% of the noncontrolling
interests in Infobird Guiyang. On June 20, 2012, Infobird Beijing established a 99.95% owned subsidiary, Anhui Infobird Software
Information Technology Co., Ltd, or Infobird Anhui, a PRC limited liability company, while Ji Meng, a shareholder of Infobird
Beijing and a shareholder of one of our principal shareholders, CRExperience Limited, owns 0.05% of the noncontrolling interests
in Infobird Anhui. Infobird Guiyang engages in software development and mainly provides business process outsourcing, or BPO,
services to customers, and Infobird Anhui engages in software development and mainly provides cloud services and technology solutions
to customers.

Reorganization

On May 27, 2020,
Infobird Cayman completed a reorganization of entities under common control of its then existing shareholders, who collectively
owned all of the equity interests of Infobird Cayman prior to the reorganization. Infobird Cayman and Infobird HK were established
as the holding companies of Infobird WFOE. Infobird WFOE is the primary beneficiary of Infobird Beijing and its subsidiaries.
All of these entities are under common control which results in the consolidation of Infobird Beijing and subsidiaries which have
been accounted for as a reorganization of entities under common control at carrying value. The consolidated financial statements
are prepared on the basis as if the reorganization became effective as of the beginning of the first period presented in the consolidated
financial statements of Infobird Cayman. The sale of Infobird Cayman’s securities in March 2020 was in the same proportion
as the ownership of Infobird Beijing prior to the reorganization. To our knowledge, such investors still currently own their same
interests in Infobird Beijing.

The charts below
summarize our corporate legal structure and identify our subsidiaries, our VIE and its subsidiaries as of the date of this prospectus
and upon completion of this offering:

Name Background Ownership
Infobird HK

· A Hong Kong company

· Incorporated on April 21, 2020

· A holding company

100% owned by Infobird Cayman
Infobird WFOE

·  A
PRC limited liability company and deemed a wholly foreign owned enterprise, or WFOE

· Incorporated on May 20, 2020

· Registered capital of $15,000,000 (RMB 106,392,000)

· A holding company

100% owned by Infobird HK
Beijing Infobird Software Co., Ltd

·  A PRC limited liability company

· Incorporated on October 26, 2001

· Registered capital of $2,417,947 (RMB 16,624,597)

VIE of Infobird WFOE
Guiyang Infobird Cloud Computing Co., Ltd

·  A PRC limited liability company

· Incorporated on October 17, 2013

· Registered capital of $1,777,645 (RMB 12,222,200)

90.18% owned by Infobird Beijing
Anhui Infobird Software Information Technology Co., Ltd

·  A PRC limited liability company

· Incorporated on June 20, 2012

· Registered capital of $1,454,440 (RMB 10,000,000)

99.95%

owned by Infobird Beijing

Contractual Arrangements

Due to legal restrictions
on foreign ownership and investment in, among other areas, the development and operation of information technology in China, including
cloud computing and big data analytics, we operates our businesses in which foreign investment is restricted or prohibited in
the PRC through certain PRC domestic companies. Neither we nor our subsidiaries own any equity interest in Infobird Beijing. As
such, Infobird Beijing is controlled through contractual arrangements in lieu of direct equity ownership by Infobird Cayman or
any of its subsidiaries. Such contractual arrangements consist of a series of three agreements, along with shareholders’
powers of attorney, or POAs, and spousal consent letters, or collectively the Contractual
Arrangements, which were signed on May 27, 2020.

The significant terms
of the Contractual Arrangements are as follows:

Exclusive Business Cooperation Agreement

Pursuant to the exclusive
business cooperation agreement between Infobird WFOE and Infobird Beijing, Infobird WFOE has the exclusive right to provide Infobird
Beijing with technical support services, consulting services and other services, including technical support and training, business
management consultation, consultation, collection and research of technology and market information, marketing and promotion services,
customer order management and customer services, lease equipment or properties, provide legitimate rights to use software license,
provide deployment, maintenances and upgrade of software, design installation, daily management, maintenance and updating network
system, hardware and database, and other services requested by Infobird Beijing from time to time to the extent permitted under
PRC law. In exchange, Infobird WFOE is entitled to a service fee that equals to all of the consolidated net income. The service
fee may be adjusted by Infobird WFOE based on the actual scope of services rendered by Infobird WFOE and the operational needs
and expanding demands of Infobird Beijing. Pursuant to the exclusive business cooperation agreement, the service fees may be adjusted
based on the actual scope of services rendered by Infobird WFOE and the operational needs of Infobird Beijing.

The exclusive business
cooperation agreement remains in effect unless terminated in accordance with the following provision of the agreement or terminated
in writing by Infobird WFOE.

During the term of
the exclusive business cooperation agreement, Infobird WFOE and Infobird Beijing shall renew the operation term prior to the expiration
thereof so as to enable the exclusive business cooperation agreement to remain effective. The exclusive business cooperation agreement
shall be terminated upon the expiration of the operation term of either Infobird WFOE or Infobird Beijing if the application for
renewal of the operation term is not approved by relevant government authorities. If an application for renewal of the operation
term is not approved, according to the PRC Company Law, the expiration of the operation term may lead to the dissolution and cancellation
of such PRC company.

Exclusive Option Agreements

Pursuant to the exclusive
option agreements among Infobird WFOE, Infobird Beijing and the shareholders who collectively owned all of Infobird Beijing, such
shareholders jointly and severally grant Infobird WFOE an option to purchase their equity interests in Infobird Beijing. The purchase
price shall be the lowest price then permitted under applicable PRC laws. Infobird WFOE or its designated person may exercise
such option at any time to purchase all or part of the equity interests in Infobird Beijing until it has acquired all equity interests
of Infobird Beijing, which is irrevocable during the term of the agreements.

The exclusive option
agreements remain in effect until all equity interest held by shareholders in Infobird Beijing has been transferred or assigned
to Infobird WFOE and/or any other person designated by the Infobird WFOE in accordance with such agreement.

Equity Interest Pledge Agreements

Pursuant to the equity
interest pledge agreements, among Infobird WFOE, Infobird Beijing, and the shareholders who collectively owned all of Infobird
Beijing, such shareholders pledge all of the equity interests in Infobird Beijing to Infobird WFOE as collateral to secure the
obligations of Infobird Beijing under the exclusive business cooperation agreement and exclusive option agreements. These shareholders
are prohibited from transferring the pledged equity interests without the prior consent of Infobird WFOE unless transferring the
equity interests to Infobird WFOE or its designated person in accordance to the exclusive option agreements.

The equity interest
pledge agreements shall come into force the date on which the pledged interests are recorded, which is within three (3) days after
signing of the agreements on May 27, 2020, under Infobird Beijing’s register of shareholders and are registered with the
competent Administration for Market Regulation of Infobird Beijing until all of the obligations to Infobird WFOE have been fulfilled
completely by Infobird Beijing. We intend to register the pledges of equity interest of shareholders with the competent Administration
for Market Regulation in accordance with the Civil Code of the PRC.

Shareholders’ POAs

Pursuant to the shareholders’
POAs, the shareholders of Infobird Beijing give Infobird WFOE an irrevocable proxy to act on their behalf on all matters pertaining
to Infobird Beijing and to exercise all of their rights as shareholders of Infobird Beijing, including the (i) right to attend
shareholders meeting; (ii) to exercise voting rights and all of the other rights including but not limited to the sale or transfer
or pledge or disposition of the shares held in part or in whole; and (iii) designate and appoint on behalf of the shareholder
the legal representative, the directors, supervisors, the chief executive officer and other senior management members of Infobird
Beijing, and to sign transfer documents and any other documents in relation to the fulfillment of the obligations under the exclusive
option agreements and the equity interest pledge agreements. The shareholders’ POAs shall remain in effect while the shareholders
of Infobird Beijing hold the equity interests in Infobird Beijing.

Spousal Consent Letters

Pursuant to the spousal
consent letters, the spouses of the shareholders of Infobird Beijing commit that they have no right to make any assertions in
connection with the equity interests of Infobird Beijing, which are held by the shareholders. In the event that the spouses obtain
any equity interests of Infobird Beijing, which are held by the shareholders, for any reasons, the spouses of the shareholders
shall be bound by the exclusive option agreement, the equity interest pledge agreement, the shareholder POA and the exclusive
business cooperation agreement and comply with the obligations thereunder as a shareholder of Infobird Beijing. The letters are
irrevocable and shall not be withdrawn without the consent of Infobird WFOE.

Based on the foregoing
contractual arrangements, which grant Infobird WFOE effective control of Infobird Beijing and subsidiaries and enable Infobird
WFOE to receive all of their expected residual returns, we account for Infobird Beijing as a VIE. Accordingly, we consolidate
the accounts of Infobird Beijing and subsidiaries for the periods presented herein, in accordance with Regulation S-X-3A-02 promulgated
by the SEC, and Accounting Standards Codification, or ASC, 810-10, Consolidation.

SELECTED CONSOLIDATED
FINANCIAL DATA

The following tables
summarize our selected consolidated financial data for the periods and as of the dates indicated. The summary consolidated statements
of income and comprehensive income for the six months ended June 30, 2020 and 2019, and for the years ended December 31, 2019
and 2018, and the summary consolidated balance sheet data as of June 30, 2020, December 31, 2019 and 2018 are derived from our
consolidated financial statements, which have been prepared in accordance with U.S. GAAP, and included elsewhere in this prospectus.
The condensed financial statements include all adjustments, consisting only of normal and recurring adjustments, that we consider
necessary for a fair representation of our June 30, 2020 financial position and operating results for the periods presented. Our
consolidated financial statements are prepared and presented in accordance with U.S. GAAP. Our historical results are not necessarily
indicative of the results that may be expected in the future, and the results for any interim period are not necessarily indicative
of the results that may be expected for a full year. The following summary consolidated financial data should be read in conjunction
with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated
financial statements included elsewhere in this prospectus.

For the Six Months Ended June
30,
For the Years Ended December
31,
2020 2019 2019 2018
$ $ $ $
(Unaudited) (Unaudited)
Consolidated Statements of Income
and Comprehensive Income:
Revenues 6,232,741 9,356,638 18,248,289 18,789,550
Cost of revenues 2,165,643 4,556,874 7,987,146 9,303,803
Gross profit 4,067,098 4,799,764 10,261,143 9,485,747
Operating expenses 2,315,061 2,503,060 4,222,263 6,418,079
Income from operations 1,752,037 2,296,704 6,038,880 3,067,668
Other expense, net 69,678 247,016 264,018 480,030
Provision for income taxes 109,818 95,261 673,034 145,263
Net income 1,572,541 1,954,427 5,101,828 2,442,375
Earnings per share, basic and diluted 0.08 0.10 0.26 0.14
Weighted average number of ordinary shares outstanding* 19,000,000 19,000,000 19,000,000 19,000,000

* Shares and per share data are presented
on a retroactive basis to reflect the nominal share issuance on March 26, 2020.

June 30, 2020 December 31,
2019
December 31,
2018
Consolidated Balance Sheet Data: $ $ $
(Unaudited)
Current assets 6,115,689 5,944,254 6,608,143
Total assets 12,013,367 11,139,226 10,369,927
Current liabilities 6,645,631 7,343,064 10,003,872
Total liabilities 6,906,145 7,544,671 10,058,604
Total equity 5,107,222 3,594,555 311,323

MANAGEMENT’S
DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following
discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated
financial statements and related notes included elsewhere in this prospectus. This discussion and analysis and other parts of
this prospectus contain forward-looking statements based upon current beliefs, plans and expectations that involve risks, uncertainties
and assumptions. Our actual results and the timing of selected events could differ materially from those anticipated in these
forward-looking statements as a result of several factors, including those set forth under “Risk Factors” and elsewhere
in this prospectus. You should carefully read the “Risk Factors” section of this prospectus to gain an understanding
of the important factors that could cause actual results to differ materially from our forward-looking statements.

Overview

We are a software-as-a-service,
or SaaS, provider of innovative AI-powered, or artificial intelligence enabled, customer engagement solutions in China. Leveraging
self-developed cloud-native architecture, AI and machine learning capabilities, patented Voice over Internet Protocol, or VoIP,
application technologies, no-code development platform, and in-depth industry expertise, we primarily provide holistic software
solutions to help our corporate clients proactively deliver and manage end-to-end customer engagement activities at all stages
of the sales process including pre-sales and sales activities and post-sales customer support. We also offer AI-powered cloud-based
sales force management software including intelligent quality inspection and intelligent training software to help our clients
monitor, benchmark and improve the performances of agents. We empower our clients with our business value-driven solutions to
increase revenue, reduce cost, and enhance customer service quality and customer satisfaction. We currently specialize in corporate
clients in the finance industry and also cover a broad array of other industries, including the education, public services, healthcare
and consumer products industries. We believe we are one of the leading and long-standing domestic SaaS providers in serving large
enterprises in the finance industry in customer engagement with over 10 years of experience. We offer a comprehensive portfolio
of customer engagement SaaS solutions that are highly intelligent, customizable and with proof of stability and security at scale
with concurrence of over 10,000 agents. We continue to innovate by developing technologies that enable us to deliver a series
of solutions and services which address the evolving and changing needs of our corporate clientele.

We generate revenues
primarily from providing standard and customized cloud-based SaaS and BPO services. For the six months ended June 30, 2020 and
2019, total revenues were approximately $6.2 million and $9.4 million, respectively. Our gross profit and net income were approximately
$4.1 million and $1.6 million, respectively, for the six months ended June 30, 2020 as compared to our gross profit and net income
of $4.8 million and $2.0 million, respectively, for the six months ended June 30, 2019. For the years ended December 31, 2019
and 2018, total revenues were approximately $18.2 million and $18.8 million, respectively. Our gross profit and net income were
$10.3 million and $5.1 million, respectively, for the year ended December 31, 2019 as compared to our gross profit and net income
of $9.5 million and $2.4 million, respectively, for the year ended December 31, 2018.

Our current emphasis
and goals primarily include execution of business strategies, improvement of cost structure, and product and service performance,
among others. We expect such emphasis and goals to remain largely the same following consummation of this offering.

We experienced a
slowdown in revenue growth in the first half of 2020 as our business was negatively impacted by the COVID-19 pandemic. We expect
our total revenues in the fiscal year 2021 to increase to at least our fiscal year 2019 level as compared to the majority of 2020
due to demand for our standard cloud-based services as discussed below. However, there is no guarantee that our total revenues
for the fiscal year 2021 will grow or remain at a similar level compared to the fiscal year 2019 and such results of operations
for the fiscal year 2021 may still be adversely impacted by the COVID-19 pandemic compared to the fiscal year 2019 and the majority
of 2020. For a detailed description of the risks associated with the novel coronavirus, see “COVID-19 Update” and
« Risk Factors—Risks Related to Doing Business in China— We face risks related to natural disasters, health epidemics
and other outbreaks, specifically the coronavirus, which could significantly disrupt our operations. » Because of the significant
uncertainties surrounding the COVID-19 pandemic, the extent of the business disruptions and the related financial impacts cannot
be reasonably estimated at this time.

Key Factors that Affect Operating Results

Our management team
monitors the following key operating metrics:

Our revenue is affected by the number of
average monthly paid user accounts our customers subscribed to and the average revenue per user account

For the six months
ended June 30, 2020 and 2019, customized cloud-based services accounted for approximately 74.8% and 70.7% of our total revenues,
respectively. All of our revenue from customized cloud-based services was from our significant customer, China Guangfa Bank. Due
to the negative impact of the COVID-19 pandemic on our business operations and that of our customers, our revenue from customized
cloud-based services decreased by 27.0% in our functional currency of approximately RMB 12.1 million (approximately $1.7 million)
to approximately RMB 32.8 million (approximately $4.7 million) for the six months ended June 30, 2020 from approximately RMB 44.9
million (approximately $6.6 million) for the six months ended June 30, 2019. Average monthly paid user accounts decreased by 18.5%
from 7,418 to 6,043 due to decreased usage, especially in the first quarter of 2020, while our significant customer reduced its
sales call activities. Paid user accounts are the number of active accounts that our customers subscribed to based on contracts
which specify a fixed fee per user account per specified period. Average monthly paid user accounts are the sum of the numbers
of paid user accounts per month divided by twelve months for yearly amounts or six months for half-year amounts, as applicable.
Average monthly paid user accounts is the operating metric that we utilize rather than paid user accounts. The average revenue
per user account decreased by approximately 10.4% in our functional currency was also due to reduced sales call activities which
normally utilize higher price products. Average revenue per user account is our total revenue for the year or half-year, as applicable,
divided by average monthly paid user accounts.

Standard cloud-based
services and BPO services accounted for approximately 23.9% and 18.7% of our total revenues for the six months ended June 30,
2020 and 2019, respectively. Our revenue from standard cloud-based services and BPO services decreased by approximately RMB 1.4
million (approximately $0.2 million) or 11.8% in our functional currency to approximately RMB 10.5 million (approximately $1.5
million) for the six months ended June 30, 2020 from approximately RMB 11.9 million (approximately $1.7 million) for the six months
ended June 30, 2019. Average monthly paid user accounts increased by 32.6% from 3,978 (3,791 for standard cloud-based services
and 187 for BPO services) to 5,276 (5,121 for standard cloud-based services and 155 for BPO services) while our average revenue
per user account decreased by approximately 33.5% in our functional currency. In order to stay competitive during the COVID-19
pandemic and maintain continuing partnerships with our existing customers, we offered volume discounts to our existing standard
cloud-based services customers who renewed service contracts during the six months ended June 30, 2020 and who committed to higher
volume usage. As such, we have seen customer usage increase since March 2020 as well as our revenue from standard cloud-based
services. Our goal was primarily to generate cash flow for the six months ended June 30, 2020 instead of optimizing profits. As
the COVID-19 pandemic is currently largely under control in China, we believe our pricing will gradually resume to normal levels
for existing customers with less discounts while new customers are based on full price.

For the years ended
December 31, 2019 and 2018, customized cloud-based services accounted for approximately 70.5% and 67.4% of our total revenues,
respectively. All of our revenue from customized cloud-based services was from our significant customer, China Guangfa Bank. Our
revenue increased by 6.2% in our functional currency of approximately RMB 5.2 million (approximately $0.7 million) to approximately
RMB 88.9 million (approximately $12.9 million) for year ended December 31, 2019 from approximately RMB 83.7 million (approximately
$12.7 million) for the year ended December 31, 2018. For the year ended December 31, 2019, average monthly paid user accounts
for customized cloud-based services increased by 15.7% from 6,095 for the year ended December 31, 2018 to 7,053 for the year ended
December 31, 2019. Our average revenue per user account decreased by approximately 8.2% in our functional currency. Due to the
nature of upfront customization and setup, our products for customized cloud-based services were not as flexible for changes which
affected our ability to offer new products and increase our prices. As part of our strategic plan, we are focusing on marketing
our standard cloud-based services and BPO services where we typically can charge higher prices for our new products and in order
to reduce our dependence on our largest customer.

Standard cloud-based
services and BPO services accounted for approximately 22.1% and 21.6% of our total revenues for the year ended December 31, 2019
and 2018, respectively. Our revenues from standard cloud-based services and BPO services increased by RMB 990,903 (approximately
$0.1 million), or 3.7%, in our functional currency to RMB 27.8 million (approximately $4.0 million) for the year ended December
31, 2019 from RMB 26.8 million (approximately $4.1 million) for the year ended December 31, 2018. For the year ended December
31, 2019, average monthly paid user accounts decreased by 22.2% from 5,408 (5,222 for standard cloud-based services and 186 from
BPO services) for the year ended December 31, 2018 to 4,208 (4,027 for standard cloud-based services and 181 from BPO services)
for the year ended December 31, 2019, while our average revenue per user account increased by approximately 33.3% in our functional
currency. The increase in average revenue per user account was mainly due to new products and functions being offered to customers
which had higher unit prices. While employing AI based customer service application solutions, we believe customers will gain
more efficiency in customer engagement than traditional SaaS. Our revenues for standard cloud-based services and BPO services
have been affected by the COVID-19 pandemic and our revenues decreased in the first half of 2020. With the completion of our self-developed
products in the no-code development platform and AI based customer services applications, we expect our revenues to increase for
the second half of 2020 and we also expect our revenues from standard cloud-based services and BPO services to increase both in
amount and as a percentage of our total revenues. Standard cloud-based services and BPO services are discussed together in this
key operating metrics section as they have the same direction, with less average monthly paid user accounts year over year, but
higher average revenue per user account year over year, as compared to customized cloud-based services, which has a separate direction.

Our revenue is
affected by the demands and usages from our major customer

For the six months
ended June 30, 2020 and 2019, China Guangfa Bank accounted for 75.5% and 81.0% of our total revenues, respectively. For the years
ended December 31, 2019 and 2018, China Guangfa Bank accounted for 77.3% and 76.7% of our total revenues, respectively. In the
second half of 2020, China Guangfa Bank changed its internal strategy of telemarketing, which resulted in a decrease in its demand
for, and usage of, our corresponding products and services. Currently, China Guangfa Bank’s internal telemarketing strategy
is to increase its internal IT capabilities. Therefore, China Guangfa Bank no longer procures such services from a third-party
provider, including us, which affects the services we provide to China Guangfa Bank. Due to our long-lasting relationship with
China Guangfa Bank, we have been actively communicating with China Guangfa Bank to explore cooperative opportunities involving
our standard cloud-based services in other business lines. We also plan to shift the focus of our business from customized cloud-based
services to standard cloud-based services in 2021 as standard cloud-based services require no customization efforts and can therefore
enable SaaS providers to quickly expand client bases as well as penetrate the market. We devoted research and development resources
into, and successfully launched, several intelligent standard cloud-based services, including intelligent quality inspection and
AI Chatbots in 2019. Our sales and marketing team has also been developing customers from multiple large- to medium-sized companies
in the finance, healthcare, and retail industries. In addition, some top banks have invited us to conduct proof-of-concept, or
PoC, tests to provide our standard cloud-based services, which is the first step before entering into a service agreement. In
2021 and beyond, we expect our revenues will not be largely solely driven from a single major customer, and we expect our standard
cloud-based services will constitute the major portion of our fiscal year 2021 revenue as compared to customized cloud-based services.
We expect such trends regarding customized cloud-based services will continue until more customers require additional demand for,
and usage of, our customized cloud-based services.

Our ability to
compete effectively

Our business and
results of operations depend on our ability to compete effectively in the industry in which we operate. Our competitive position
may be affected by, among other things, the scope of our products, the quality of our solutions and our ability to customize our
products to meet customers’ business needs. We believe that our proprietary technologies and research and development capabilities
help us to develop products tailored to our customers and we are able to retain and develop business with existing customers and
to attract new customers. However, if are unable to keep up with our product development or innovation, we might not be able to
develop new customers or expand our business effectively. In addition, we are subject to competition from within our industry.
Increased competition could materially and adversely affect our business and results of operations.

The PRC economy

Although the PRC
economy has grown in recent years, the pace of growth has slowed in recent years, and rate of growth may not continue in the future.
According to the PRC National Bureau of Statistics, the annual rate of growth in the PRC declined from 7.7% in 2013 to 6.1% in
2019. A further slowdown in overall economic growth, an economic downturn or recession or other adverse economic developments
in the PRC may materially reduce the purchase power of the consumers of our products and lead to the decrease of demand for our
products and services and may have a material and adverse effect on our business.

In December 2019,
a novel strain of coronavirus, or COVID-19, surfaced and spread rapidly over the globe, including China and the United States.
The epidemic has resulted in quarantines, travel restrictions, and the temporary closure of stores and facilities in China and
elsewhere. Substantially all of our revenue is concentrated in China. Consequently, the COVID-19 pandemic may materially and adversely
affect our business operations, financial condition and operating results for 2020. For a detailed description of the risks associated
with COVID-19, see “Risk Factors – Risks Related to Doing Business in China – We face risks related to natural
disasters, health epidemics and other outbreaks, specifically the coronavirus, which could significantly disrupt our operations.”

The PRC government

Our PRC entities
are incorporated, and their operations and assets are located, in China. Accordingly, our results of operations, financial condition
and prospects are affected by China’s regulation conditions in the following factors: (a) economic policies and initiatives
undertaken by the PRC government; (b) changes in the Chinese or regional business or regulatory environment affecting the purchase
power of consumers of our products; and (c) changes in Chinese government policy affecting our industry. Unfavorable changes could
affect demand for products that we sell and for products that we provide and could materially and adversely affect the results
of operations.

Key Components of Our Results of Operations

Revenues consist
of revenues from customized and standard cloud-based services, business processing outsourcing services and others.

Revenue from customized
cloud-based services

We provide customized
cloud-based customer engagement services which includes customized SaaS, voice/data plan, which includes telecommunication usage
such as telephone calls and messaging that our customers can subscribe for, and technical support. The provision of customized
SaaS, voice/data plan and technical support is considered as one performance obligation as the services provided are not distinct
within the context of the contract whereas the customers can only obtain benefit when the services are provided together. We use
monthly utilization records based on the number of user accounts subscribed by customers, an output measure, to recognize revenue
over time as there is simultaneous consumption and delivery of services.

As of June 30, 2020
and December 31, 2019, we derived all of our customized cloud-based revenues from China Guangfa Bank. We have previously entered
into contracts with China Guangfa Bank where the amounts charged per user account were fixed and determinable, and the specific
terms of the contracts were agreed to by us and China Guangfa Bank. Contract performance periods are generally fifteen months,
and payment terms are generally a specified percentage prepaid based on estimated usage, and the remaining to be billed monthly
based on actual usage. Contracts generally do not contain significant financing components or variable consideration. The latest
customized cloud-based services contract and telecommunications services contract with China Guangfa Bank expired on June 30,
2020 and December 31, 2020, respectively, and such contracts have not been renewed by China Guangfa Bank. See “Risk Factors—Risks
Related to Our Business and Industry— We generate a significant portion of our revenues primarily from a single major customer,
China Guangfa Bank, which accounted for 75.5% and 77.3% of our total revenues for the six months ended June 30, 2020 and for the
year ended December 31, 2019, respectively, and loss of business from such customer could reduce our revenues and significantly
harm our business” for additional information.

Revenue from standard
cloud-based services

We also provide standard
cloud-based solutions that provide customers the right to access our software through the internet. Our cloud-based solutions
represent a series of services such as calling, voice recording and technical support. These services are made available to the
customer continuously throughout the contractual period, however, the extent to which the customer uses the services may vary
at the customers’ discretion. The standard cloud-based services are considered to have one single performance obligation.
We use monthly utilization records based on the number of user accounts subscribed by customers, an output measure, to recognize
revenue over time as there is simultaneous consumption and delivery of services. We also have some contracts with customers where
the customer subscribes for a fix number of user accounts over certain contract periods, therefore the customers receive and consume
the benefits of the cloud services throughout the subscription period so revenue is recognized ratably over the contractual subscription
period in which the services are delivered, beginning on the date the service is made available to the customers. Contract performance
periods generally are one year, and pursuant to the contracts, full payments are generally collected in advance, with payment
to be made within three months after execution of the contract. Contracts generally do not contain significant financing components
or variable consideration.

Revenue from BPO
services

Revenue from BPO
services is generated from assisting customers to operate the call centers services. Customers using these services are not permitted
to take possession of our software and physical resources and the contract is for a defined period, where customers pay a monthly
service fee. These services are considered as one performance obligation as the customers does not obtain benefit for each separate
services. Revenues are recognized over time over contractual period using the time elapsed output method as BPO services are provided.
Contract performance periods generally are one year, and pursuant to the contracts, full payments for several months of services
are generally collected in advance. Contracts generally do not contain significant financing components or variable consideration.

Professional services
and other revenues

We also generate
revenue from data analysis services and other professional services. The service revenue from data analysis services and other
professional services is recognized over time as services are performed and delivered to customers. Contract performance periods
generally range from month to month, completion of service (software license) to one year, and payment terms are generally prepaid
to 30 days. Contracts generally do not contain significant financing components or variable consideration.

Revenue categories
are summarized as follows:

For the Six Months
Ended
June 30,
Change For the Years Ended
December 31,
Change
2020 % 2019 % % 2019 % 2018 % %
(Unaudited) (Unaudited)
Standard cloud-based services $ 658,142 10.6 % $ 778,949 8.3 % (15.5 )% $ 2,018,919 11.1 % $ 2,064,669 11.0 % (2.2 )%
Customized cloud-based services 4,660,918 74.8 % 6,617,204 70.7 % (29.6 )% 12,865,074 70.5 % 12,663,985 67.4 % 1.6 %
BPO services 830,170 13.3 % 970,412 10.4 % (14.5 )% 2,007,919 11.0 % 1,994,501 10.6 % 0.7 %
Other revenues 83,511 1.3 % 990,073 10.6 % (91.6 )% 1,356,377 7.4 % 2,066,395 11.0 % (34.4 )%
Total operating revenues $ 6,232,741 100 % $ 9,356,638 100 % (33.4 )% $ 18,248,289 100 % $ 18,789,550 100 % (2.9 )%

Cost of revenues

Cost of revenues
consists primarily of costs (including salaries, social insurance and benefits) for employees involved with our operations and
products and services support, third party service fees including cloud and data usage, hosting fees, and amortization and depreciation
expenses associated with our capitalized software, platform system and hardware. In addition, cost of revenues also include outsourcing
contracted customer service representatives, customer surveys and allocated share costs, primarily including facilities, information
technology and security costs.

Cost of revenues
from revenue categories are summarized as follows:

For the Six Months
Ended  June 30,
Change For the Years Ended
 December 31,
Change
2020 2019 % 2019 2018 %
(Unaudited) (Unaudited)
Standard and customized cloud-based services $ 1,394,070 $ 2,793,488 (50.1 )% $ 5,121,529 $ 5,252,081 (2.5 )%
BPO services 707,979 939,423 (24.6 )% 1,773,993 2,427,169 (26.9 )%
Other revenues 63,594 823,963 (92.3 )% 1,091,624 1,624,553 (32.8 )%
Total cost of revenues $ 2,165,643 $ 4,556,874 (52.5 )% $ 7,987,146 $ 9,303,803 (14.2 )%

Operating expenses

Our operating expenses
consist of selling expenses, general and administrative expenses, and research and development expenses.

Selling expenses
consist of personnel costs (including salaries, social insurance, and benefits), office and travel expenses for employees associated
with our sales and marketing organizations, and costs of marketing activities. Marketing activities include both online and offline
marketing initiatives, including digital advertising, such as search engines, paid social, email and product marketing, content
marketing, web marketing and optimization. We focus our sales and marketing efforts on generating awareness of our services and
products, establishing and promoting our brand, and cultivating a community of customers. Our selling expenses as a percentage
of our revenue were approximately 12.6% and 8.3% for the six months ended June 30, 2020 and 2019, respectively. Our selling expenses
as a percentage of our revenue were approximately 8.4% and 10.2% for the years ended December 31, 2019 and 2018, respectively.

General and administrative
expenses consist primarily of rent, office expenses and personnel costs (including salaries, social insurance, and benefits) for
our executive, finance, legal, human resources, and other administrative employees. In addition, general and administrative expenses
include amortization expense from land used rights. Our general and administrative expenses as a percentage of our revenue were
approximately 13.5% and 6.0% for the six months ended June 30, 2020 and 2019, respectively. Our general and administrative expenses
as a percentage of our revenue were approximately 6.5% and 7.9% for the years ended December 31, 2019 and 2018, respectively.

Research and development
expenses consist primarily of salaries and other compensation-related expenses for our research and product development personnel,
as well as office rental, depreciation, amortization and related expenses for our research and product development team. We focus
our research and development efforts on the continued development of our services and products, including the development and
deployment of new features and functionality and enhancements to our software architecture and integration across our services
and products. Our research and development expenses as a percentage of our revenue were approximately 11.1% and 12.4% for the
six months ended June 30, 2020 and 2019, respectively. Our research and development expenses as a percentage of our revenue were
approximately 8.2% and 16.0% for the years ended December 31, 2019 and 2018, respectively.

Results of Operations

Comparison
of Six Months Ended June 30, 2020 and June 30, 2019 and Years Ended December 31, 2019 and December 31, 2018

For the Six
Months Ended

June
30,

Change

For the
Years Ended

December
31,

Change
2020 2019 % 2019 2018 %
(Unaudited) (Unaudited)
Revenues $ 6,232,741 $ 9,356,638 (33.4 )% $ 18,248,289 $ 18,789,550 (2.9 )%
Cost of revenues 2,165,643 4,556,874 (52.5 )% 7,987,146 9,303,803 (14.2 )%
Gross profit 4,067,098 4,799,764 (15.3 )% 10,261,143 9,485,747 8.2 %
Selling expenses 783,945 778,505 0.7 % 1,533,255 1,918,418 (20.1 )%
General and administrative expenses 838,995 564,179 48.7 % 1,192,429 1,488,802 (19.9 )%
Research and development expenses 692,121 1,160,376 (40.4 )% 1,496,579 3,010,859 (50.3 )%
Income from operations 1,752,037 2,296,704 (23.7 )% 6,038,880 3,067,668 96.9 %
Other expense, net 69,678 247,016 (71.8 )% 264,018 480,030 (45.0 )%
Provision for income taxes 109,818 95,261 15.3 % 673,034 145,263 363.3 %
Net income $ 1,572,541 $ 1,954,427 (19.5 )% $ 5,101,828 $ 2,442,375 108.9 %

Six
Months Ended June 30, 2020 Compared to Six Months Ended June 30, 2019

Revenues

Total revenues decreased
by approximately $3.1 million, or 33.4%, to approximately $6.2 million for the six months ended June 30, 2020 from approximately
$9.4 million for the six months ended June 30, 2019. The decrease was mainly due to the negative impact of the COVID-19 pandemic
on our business operations, as we had to comply with the temporary closure of facilities in the first quarter of 2020. Our customers
have also been negatively impacted by office closures and reductions in customer service activities. In April 2020, our offices
were reopened. The change for each revenue stream was as follows:

For the six months
ended June 30, 2020 and 2019, our standard cloud-based services revenue decreased by approximately $0.1 million, or 15.5%, to
approximately $0.7 million for the six months ended June 30, 2020 compared to approximately $0.8 million for the same period in
2019. Standard cloud-based services revenue represented approximately 10.6% and 8.3% of our total revenues for the six months
ended June 30, 2020 and 2019, respectively. The average monthly paid user accounts for standard cloud-based services increased
to 5,121 for the six months ended June 30, 2020 from 3,791 for the six months ended June 30, 2019. In order to stay competitive
during the COVID-19 pandemic and maintain continuing partnerships with our existing customers, we offered volume discounts to
our existing standard cloud-based services customers who renewed service contracts during the six months ended June 30, 2020 and
who committed to higher volume usage. As such, we have seen customer usage increase since March 2020 as well as our revenue from
standard cloud-based services. Our goal was primarily to generate cash flow for the six months ended June 30, 2020 instead of
optimizing profits. As the pandemic is currently largely under control in China, we believe our pricing will gradually resume
to normal levels for existing customers with less discounts while new customers are based on full price.

Customized cloud-based
services revenue decreased by approximately $2.0 million, or 29.6%, to approximately $4.7 million for the six months ended June
30, 2020 compared to approximately $6.6 million for the same period in 2019. The decrease was due to the decrease of 1,375 average
monthly paid user accounts being subscribed by our customers, of which such decrease was from one customer, China Guangfa Bank.
The average monthly paid user accounts decreased to 6,043 for the six months ended June 30, 2020 from 7,418 for the six months
ended June 30, 2019, representing an approximate 18.5% decrease and was primarily because our significant customer, China Guangfa
Bank, reduced the demand for our services due to the impact of the COVID-19 pandemic. Our decrease in revenue was also affected
by the fee rates we charged. The fee rate variation depends on products offered and other factors in a competitive market. Customers
may choose different products based on their needs which will affect the fee rates we charge. In addition, we have also adjusted
our pricing based on our cost savings and our competitive strategies. The combined effect of the decrease in average monthly paid
user accounts and the lowered fee rates has decreased our revenue from customized cloud-based services by 29.6%. For the six months
ended June 30, 2020 and 2019, customized cloud-based services revenue represented approximately 74.8% and 70.7% of our total revenues,
respectively. Due to the impact of COVID-19 and China Guangfa Bank’s change in internal strategy of telemarketing, our customized
cloud-based services revenue in the fiscal year 2020 will be lower compared to the fiscal year 2019. We expect such revenue to
continue declining in the fiscal year 2021 mainly due to China Guangfa Bank’s decrease in its demand for, and usage of,
our corresponding products and services. Currently, China Guangfa Bank’s internal telemarketing strategy is to increase
its internal IT capabilities. Therefore, China Guangfa Bank no longer procures such services from a third-party provider, including
us, which affects the services we provide to China Guangfa Bank. Due to our long-lasting relationship with China Guangfa Bank,
we have been actively communicating with China Guangfa Bank to explore cooperative opportunities involving our standard cloud-based
services in other business lines. We also plan to shift the focus of our business from customized cloud-based services to standard
cloud-based services in 2021 as standard cloud-based services require no customization efforts and can therefore enable SaaS providers
to quickly expand client bases as well as penetrate the market. We devoted research and development resources into, and successfully
launched, several intelligent standard cloud-based services, including intelligent quality inspection and AI Chatbots in 2019.
Our sales and marketing team has also been developing customers from multiple large- to medium-sized companies in finance, healthcare,
and retail industries. In addition, some top banks have invited us to conduct PoC tests to provide our standard cloud-based services,
which is the first step before entering into a service agreement. In 2021 and beyond, we expect our revenues will not be largely
solely driven from a single major customer, and we expect our standard cloud-based services will constitute the major portion
of our fiscal year 2021 revenue as compared to customized cloud-based services. We expect such trends regarding customized cloud-based
services will continue until more customers require additional demand for, and usage of, our customized cloud-based services.

BPO service fees
decreased by approximately $0.1 million, or 14.5%, to approximately $0.8 million for the six months ended June 30, 2020 compared
to approximately $1.0 million for the same period in 2019, representing approximately 13.3% and 10.4% of our total revenues for
the six months ended June 30, 2020 and 2019, respectively. The average monthly paid user accounts for BPO services decreased to
155 for the six months ended June 30, 2020 from 187 for the six months ended June 30, 2019 due to decreased usage as a result
of impact from the COVID-19 pandemic.

Other revenues amounted
to approximately $0.1 million and $1.0 million for the six months ended June 30, 2020 and 2019, respectively, representing approximately
1.3% and 10.6% of our total revenues for the six months ended June 30, 2020 and 2019, respectively. Due to the COVID-19 pandemic,
our customers have further reduced non-essential projects which lead to our revenue decrease. As we focus our operations on cloud-based
SaaS, we expect other revenues, which consist of sales of software, data analysis and other technical consulting services, will
continue to decrease and represent an insignificant portion of our total revenues.

Cost of Revenues

Total cost of revenues
decreased significantly by approximately $2.4 million, or 52.5%, to approximately $2.2 million for the six months ended June 30,
2020 from approximately $4.6 million for the six months ended June 30, 2019.

Cost of revenues
incurred by standard and customized cloud-based services decreased significantly by approximately $1.4 million, or 50.1%, for
the six months ended June 30, 2020 compared to the same period in 2019. The significant decrease was in line with the decrease
of our revenue which had been adversely affected by the COVID-19 pandemic for the six months ended June 30, 2020. As a result,
our cloud and data usage decreased accordingly.

Cost of sales for
BPO services decreased by approximately $0.2 million, or 24.6%, for the six months ended June 30, 2020 compared to the same period
in 2019. The decrease was in line with the decrease of BPO services revenue which had been adversely affected by the COVID-19
pandemic for the six months ended June 30, 2020. As of June 30, 2020, we had a total of 173 customer service representatives to
serve our clients compared to 229 customer services representatives as of June 30, 2019. The number of customer services representatives
are adjusted periodically based on our business needs.

Cost of sales for
other revenues decreased by approximately $0.8 million, or 92.3%, for the six months ended June 30, 2020 compared to the same
period in 2019. The decrease was in line with the decrease in other revenues as we focused more on our cloud-based SaaS operations.

Gross Profit

Our gross profit
from our major revenue categories are summarized as follows:

For the Six
Months

Ended

June 30, 2020

For the Six
Months

Ended

June 30, 2019

Change

Percentage

Change

(Unaudited) (Unaudited)
Standard and customized cloud-based services
Gross profit $ 3,924,990 $ 4,602,665 $ (677,675 ) (14.7 )%
Gross margin 73.8 % 62.2 % 11.6 %
BPO services
Gross profit $ 122,191 $ 30,989 $ 91,202 294.3 %
Gross margin 14.7 % 3.2 % 11.5 %
Other services
Gross profit $ 19,917 $ 166,110 $ (146,192 ) (88.0 )%
Gross margin 23.8 % 16.8 % 7.1 %
Total
Gross profit $ 4,067,098 $ 4,799,764 $ (732,666 ) (15.3 )%
Gross margin 65.3 % 51.3 % 14.0 %

Our gross profit
decreased by approximately $0.7 million, or 15.3%, to approximately $4.1 million for the six months ended June 30, 2020 from approximately
$4.8 million for the six months ended June 30, 2019. The decrease of the gross profit was primarily caused by the negative impact
from the COVID-19 pandemic on our business operations. For the six months ended June 30, 2020 and 2019, our overall gross margin
was approximately 65.3% and 51.3%, respectively, representing a 14.0% increase. The increase of gross margin was primarily caused
by the decrease in cost of revenues as discussed above and improvement in functionality of our software and infrastructure which
resulted in more efficiency in providing services to our customers.

Operating Expenses

During the six months
ended June 30, 2020, we incurred a total of approximately $2.3 million operating expenses, a decrease of approximately $0.2 million,
or 7.5%, as compared to a total of approximately $2.5 million during the six months ended June 30, 2019.

Selling expenses
remained consistent as they amounted to approximately $0.8 million for both the six months ended June 30, 2020 and 2019.

General and administrative
expenses increased by approximately $0.2 million, or 48.7%, to approximately $0.8 million for the six months ended June 30, 2020
from approximately $0.6 million for the six months ended June 30, 2019. The increase was mainly attributable to an approximate
$0.2 million increase in professional fees, such as audit fees, as we continue the process of becoming a publicly traded company
in the United States.

Research and development
expenses decreased by approximately $0.5 million, or 40.4%, to approximately $0.7 million for the six months ended June 30, 2020
from approximately $1.2 million for the six months ended June 30, 2019. The decrease was mainly because for the six months ended
June 30, 2020, we incurred more expenses in the development stage of our product development cycle which typically lasts about
6 to 18 months. During the initial planning and resource allocation stage of product development, we expensed all costs incurred
for research and development activities and while we entered the product development stage, all related costs were capitalized.
We had several new products in development as of June 30, 2020 which primarily related to our no-code development platform and
artificial intelligence customer services applications solutions. Our no-code development platform enables rapid application development
and delivery which brings abstraction and automation to the complete application lifecycle, providing an efficient way for our
engineers to build applications. Artificial intelligence customer services applications solutions are applications that will be
built on our no-code development platform. We initiated the planning and resource allocations and determined performance requirements
and initial design stages of the products in early 2019 and all related costs were expensed in accordance with ASC 350-40. When
the products entered the development stage, all costs related to specific programming and coding of the products were capitalized.
We did not have as many new products in development for the six months ended June 30, 2019 as compared to the same period in 2020.

Other income (expense), net

Total other expenses,
net were approximately $0.1 million and $0.2 million for the six months ended June 30, 2020 and 2019, respectively.

Interest income remained
consistent for the six months ended June 30, 2020 and 2019 as it amounted to approximately $4,000 for both the six months ended
June 30, 2020 and 2019. Interest income consists of bank interest income.

Interest expense
decreased to approximately $0.1 million for the six months ended June 30, 2020 from approximately $0.3 million for the six months
ended June 30, 2019 as we renewed our loans from Bank of Beijing in April 2019 with a lower interest rate of 5.2% as compared
to an interest rate of 5.7% on our loans from Bank of Beijing that were renewed in 2018.

Other income included
cash received from government grant and VAT credits. Other income increased to approximately $62,000 for the six months ended
June 30, 2020 from approximately $25,000 for the six months ended June 30, 2019.

Cash received from
government subsidies increased by approximately $29,000 to approximately $32,000 for the six months ended June 30, 2020 from approximately
$3,000 for the six months ended June 30, 2019, as we applied for, and received, more government subsidies for new technology for
our effort to promote local technology and economic growth.

Other income also
included approximately $19,000 of input VAT credit that we redeemed during the six months ended June 30, 2020. As part of the
PRC VAT reform in 2019, taxpayers in certain service industries were allowed to reclaim additional 10% of input VAT credit against
the amount of VAT payable from April 1, 2019 to December 31, 2021.

Provision for income taxes

We recorded income
tax expense of approximately $110,000 for the six months ended June 30, 2020 compared to income tax expense of approximately $95,000
for the six months ended June 30, 2019. The approximate $15,000 increase is primarily due to an increase of provision for deferred
income tax of approximately $43,000 to approximately $110,000 for the six months ended June 30, 2020 from approximately $67,000
for the six months ended June 30, 2019, as we incurred more research and development expenses that were required to be capitalized
into intangible assets for the six months ended June 30, 2020 compared to the same period in 2019.

Net income

Our net income decreased
by approximately $0.4 million, or 19.5%, to approximately $1.6 million for the six months ended June 30, 2020, from approximately
$2.0 million for the six months ended June 30, 2019. Such change was the result of the combination of the changes as discussed
above.

Year
Ended December 31, 2019 Compared to Year Ended December 31, 2018

Revenues

Total revenues decreased
by approximately $0.5 million, or 2.9%, to approximately $18.2 million for the year ended December 31, 2019 from approximately
$18.8 million for the year ended December 31, 2018. The decrease was mainly due to an approximate 4.5% decrease of average exchange
rate applied to statement of income. The average exchange rate accounts for the years ended December 31, 2019 and 2018 were RMB
6.91 and RMB 6.61 to $1.00, respectively. Total revenues in functional currency increased by RMB 1,881,581 (approximately $0.3
million), or 1.5%, to RMB 126,061,717 (approximately $18.2 million) for the year ended December 31, 2019 from RMB 124,180,136
(approximately $18.8 million) for the year ended December 31, 2018. The change for each revenue stream was as follows:

For the years ended
December 31, 2019 and 2018, our standard cloud-based services revenue decreased by approximately $46,000, or 2.2%, to approximately
$2.0 million for the year ended December 31, 2019 compared to approximately $2.1 million for the same period in 2018. Excluding
the effect of exchange rate change, standard cloud-based services revenue increased by approximately RMB 0.3 million (approximately
$44,000), or 2.2%, to approximately RMB 13.9 million (approximately $2.0 million) for year ended December 31, 2019 from approximately
RMB 13.6 million (approximately $2.1 million) for the year ended December 31, 2018 in our functional currency. The average monthly
paid user accounts for standard cloud-based services decreased to 4,027 for the year ended December 31, 2019 from 5,222 for the
year ended December 31, 2018. Standard cloud-based services revenue represented approximately 11.1% and 11.0% of our total revenues
for the years ended December 31, 2019 and 2018, respectively. Our focus on standard cloud-based services for the year ended 2019
and 2018 was to maintain and service our existing clients as we were in development of several new products which we expect to
be fully developed and launched in 2021. We expect our revenue to increase when such new products are released.

Customized cloud-based
services revenue increased by approximately $0.2 million, or 1.6%, to approximately $12.9 million for the year ended December
31, 2019 compared to approximately $12.7 million for the same period in 2018. Excluding the effect of exchange rate change, customized
cloud-based services revenue increased by approximately RMB 5.2 million (approximately $0.7 million), or 6.2%, to approximately
RMB 88.9 million (approximately $12.9 million) for the year ended December 31, 2019 from RMB 83.7 million (approximately $12.7
million) for the year ended December 31, 2018. The increase was partly due to the increase of 958 average monthly paid user accounts
being subscribed by our major customer, China Guangfa Bank. The average monthly paid user accounts for customized cloud-based
services increased to 7,053 for the year ended December 31, 2019 from 6,095 for the year ended December 31, 2018, representing
an approximate 15.7% increase. Our revenue was also affected by the fee rates we charged and our adjustment in pricing. We adjusted
our pricing based on our cost savings and our competitive strategies. The fee rate variation depends on products offered and other
factors in the competitive market. Therefore, our increase in average monthly paid user accounts of 15.7% was offset by the lowered
fee rates that we charged to our major customer, which resulted in the increase of revenue by approximately 6.2%. For the years
ended December 31, 2019 and 2018, customized cloud-based services revenue represented approximately 70.5% and 67.4% of our total
revenues, respectively.

BPO service fees
remained stable at approximately $2.0 million for the years ended December 31, 2019 and 2018, respectively, representing approximately
11.0% and 10.6% of our total revenues for the years ended December 31, 2019 and 2018, respectively. The average monthly paid user
accounts for BPO services decreased to 181 for the year ended December 31, 2019 from 186 for the year ended December 31, 2018.

Other revenues amounted
to approximately $1.4 million and $2.1 million for the years ended December 31, 2019 and 2018, respectively, representing approximately
7.4% and 11.0% of our total revenues for the years ended December 31, 2019 and 2018, respectively. As we focus our operations
on cloud-based SaaS, we expect other revenues, which consist of sales of software, data analysis and other technical consulting
services, will continue to decrease and represent an insignificant portion of our total revenues.

Cost of Revenues

Total cost of revenues
decreased by approximately $1.3 million, or 14.2%, to approximately $8.0 million for the year ended December 31, 2019 from approximately
$9.3 million for the year ended December 31, 2018.

Cost of revenues
incurred by standard and customized cloud-based services decreased by approximately $0.1 million, or 2.5%, for the year ended
December 31, 2019 compared to the same period in 2018. As we improved our functionality of software and infrastructure, we believe
we were able to provide the services more efficiently and achieve economy of scale as our paid users increased.

Cost of sales for BPO
services decreased by approximately $0.7 million, or 26.9%, for the year ended December 31, 2019 compared to the same period in
2018. The decrease was because we increased outsourcing of customer service representatives to third party contractors as compared
to our in-house operators. The outsourced operators usually perform more basic customer service requirements. As of December 31,
2019, we maintained 148 in-house customer service representatives compared to 48 outsourced customer service representatives.
Our in-house customer service representatives typically have more experience and better knowledge of our software in order to
service clients who require a high level of customer service, such as our clients in the finance industry. Our in-house representatives
also assist in supervising the outsourced customer service representatives. The number of in-house customer services representatives
may decrease if we have less customer demands for in-house representatives.

Cost
of sales for other revenues decreased by approximately $0.5 million, or 32.8%, for the year ended December 31, 2019 compared to
the same period in 2018. The decrease was in line with the decrease in other revenues as we focus more on our cloud-based SaaS
operations.

Gross Profit

Our gross profit
from our major revenue categories are summarized as follows:

For
the Year ended
December 31,  2019
For
the Year ended
December 31,  2018
Change

Percentage

Change

Standard and customized cloud-based services
Gross profit $ 9,762,464 $ 9,476,573 $ 285,891 3.0 %
Gross margin 65.6 % 64.3 % 1.3 %

BPO services

Gross profit $ 233,926 $ (432,668) $ 666,594 154.1 %
Gross margin 11.7 % (21.7 )% 33.4 %
Other services
Gross profit $ 264,753 $ 441,842 $ (177,089 ) (40.1 )%
Gross margin 19.5 % 21.4 % (1.9) %
Total
Gross profit $ 10,261,143 $ 9,485,747 $ 775,396 8.2 %
Gross margin 56.2 % 50.5 % 5.7 %

Our gross profit
increased by approximately $0.8 million to approximately $10.3 million for the year ended December 31, 2019 from approximately
$9.5 million for the year ended December 31, 2018. For the years ended December 31, 2019 and 2018, our overall gross margin was
approximately 56.2% and 50.5%, respectively. The increase was primarily caused by the decrease in the cost of revenues as discussed
above.

Operating Expenses

During the year ended
December 31, 2019, we incurred a total of approximately $4.2 million operating expenses, a decrease of approximately $2.2 million,
or 34.2%, as compared to a total of approximately $6.4 million during the year ended December 31, 2018.

Selling expenses
decreased by approximately $0.4 million, or 20.1%, to approximately $1.5 million for the year ended December 31, 2019 from approximately
$1.9 million for the year ended December 31, 2018. The decrease was mainly due to a decrease in marketing and promotion expenses
as we focus on investing in cost-effective marketing initiatives and continuously evaluate the effectiveness of various marketing
channels to optimize the allocation of our marketing spending.

General and administrative
expenses decreased by approximately $0.3 million, or 19.9%, to approximately $1.2 million for the year ended December 31, 2019
from approximately $1.5 million for the year ended December 31, 2018. The decrease was mainly due to a decrease in salary, social
security and disability insurance expenses paid to our management team. We expect our general and administrative expenses to increase
in 2020 due to estimated expenses associates with becoming a public company.

Research and
development expenses decreased by approximately $1.5 million, or 50.3%, to approximately $1.5 million for the year ended December
31, 2019 from approximately $3.0 million for the year ended December 31, 2018. The decrease was mainly because in 2019 we incurred
more expenses in the development stage of our product development cycle which typically lasts about 6 to 18 months. During the
initial planning and resource allocation stage of product development, we expensed all costs incurred for research and development
activities and while we entered the product development stage, all related costs were capitalized. We had several new products
in development as of December 31, 2019 which primarily related to our no-code development platform and artificial intelligence
customer services applications solutions. Our no-code development platform enables rapid application development and delivery
which brings abstraction and automation to the complete application lifecycle, providing an efficient way for our engineers to
build applications. Artificial intelligence customer services applications solutions are applications that will be built on our
no-code development platform. We initiated the planning and resource allocations and determined performance requirements and initial
design stages of the products in early 2019 and all related costs were expensed in accordance with ASC 350-40. When the products
entered the development stage, all costs related to specific programming and coding of the products were capitalized. We did not
have as many new products in development in 2018 as compared to 2019. Most of our research and development activities were focused
on our existing SaaS software and systems maintenance in 2018, with related costs expensed and recorded as research and development
expenses.

Other income (expense), net

Total other expenses,
net were approximately $0.3 million and $0.5 million for the years ended December 31, 2019 and December 31, 2018, respectively.

Interest income increased
to approximately $9,000 for the year ended December 31, 2019 from approximately $5,000 for the year ended December 31, 2018. Interest
income consists of bank interest income.

Interest expense
decreased to approximately $0.4 million for the year ended December 31, 2019 from approximately $0.5 million for the year ended
December 31, 2018 as we renewed our loans from Bank of Beijing in 2019 with a lower interest rate of 5.2% as compared to an interest
rate of 5.7% on our loans from Bank of Beijing that were renewed in 2018.

Other income included
cash received from government grant and VAT credits. Other income increased to approximately $146,000 for the year ended December
31, 2019 from approximately $61,000 for the year ended December 31, 2018.

Cash received from
government subsidies increased by approximately $32,000 to approximately $89,000 for the year ended December 31, 2019 from approximately
$57,000 for the year ended December 31, 2018, as we applied for, and received, more government subsidies for new technology for
our effort to promote local technology and economic growth.

Other income also included
approximately $49,000 of input VAT credit that we redeemed during the year ended December 31, 2019. As part of the PRC VAT reform
in 2019, taxpayers in certain service industries were allowed to reclaim additional 10% of input VAT credit against the amount
of VAT payable from April 1, 2019 to December 31, 2021.

Provision for income taxes

We recorded income tax
expense of approximately $0.7 million for the year ended December 31, 2019 compared to income tax expense of approximately $0.1
million for the year ended December 31, 2018. The approximate $0.6 million increase is primarily a result of an increase of approximately
$3.2 million, or 123.2%, of net income before tax to approximately $5.8 million for the year ended December 31, 2019 from approximately
$2.6 million for the year ended December 31, 2018.

Net income

Our net income increased
by approximately $2.7 million, or 108.9%, to approximately $5.1 million for the year ended December 31, 2019, from approximately
$2.4 million for the year ended December 31, 2018. Such change was the result of the combination of the changes as discussed above.

Liquidity and Capital Resources

In assessing our
liquidity, we monitor and analyze our cash on-hand and our operating expenditure commitments. Our liquidity needs are to meet
our working capital requirements and operating expense obligations. To date, we have financed our operations primarily through
cash flows from operations and short-term borrowing from banks and related parties. Our major customer, China Guangfa Bank, accounted
for 75.5% and 81.0% of our total revenues for the six months ended June 30, 2020 and 2019, respectively, of which we collected
approximately $2.3 million and $7.8 million in cash, respectively. The loss of our major customer or a reduction in usage by our
major customer would adversely impact our liquidity. However, in 2021 and beyond, we expect our revenues will not be largely solely
driven from a single major customer, and we expect our standard cloud-based services will constitute the major portion of our
fiscal year 2021 revenue as compared to customized cloud-based services.

As of June 30, 2020,
our working capital deficit was approximately $0.5 million and cash amounted to $1.2 million. Although our working capital deficit
was approximately $0.5 million as of June 30, 2020, approximately $1.5 million of which was deferred revenue which we expect to
realize as we do not expect to make any significant refund based on historical experience. Excluding deferred revenue, our working
capital was approximately $1.0 million. Our management believes that we will require a minimum of approximately $4.0 million over
the next twelve months to operate at our current level, either from revenues or funding. Given our expected expenditures in the
foreseeable future, together with our cash flow from the financing activities, we have comprehensively considered our available
sources of funds as follows:

· financial
support and credit guarantee from related parties; and
· additional
equity or debt financing.

Based on the above
considerations, our board of directors is of the belief that we are able to obtain sufficient funds to meet our working capital
requirements and debt obligations as they become due over the next twelve (12) months.

We intend to use
the funds raised from this offering to grow our business primarily through:

· strengthening
sales and marketing;
· enhancing
our research and development; and
· investing
in working capital and general corporate purposes, including future capital expenditures,
such as the construction of the cloud computing facility in Guiyang, China, and increasing
our liquidity.

Although we consolidate
the results of our VIE and its subsidiaries, we only have access to cash balances or future earnings of our VIE and its subsidiaries
through our contractual arrangements with our VIE.

Current foreign exchange
and other regulations in the PRC may restrict our PRC entities in their ability to transfer their net assets to us and our subsidiaries
in the Cayman Islands and Hong Kong. However, these restrictions will likely have no impact on the ability of these PRC entities
to transfer funds to us as we have no present plans to declare dividends as we plan to retain our retained earnings to continue
to grow our business. In addition, these restrictions will likely have no impact on our ability to meet our cash obligations as
all of our current cash obligations are due within the PRC.

As of June 30, 2020,
we had the following short-term bank loans outstanding:

Bank Name

Maturities Interest
Rate
Collateral/Guarantee June
30, 2020
Bank
of Beijing
March
and April 2021
5.2%
– 5.7%
Guarantee
by Beijing SMEs Credit Re-guarantee Co., Ltd
$ 2,830,816

In March 2020, we
renewed our line of credit for a two-year period. In March and April 2020, we renewed two loan contracts with Bank of Beijing
under the line of credit to obtain loans in a total amount of approximately $2.9 million (RMB 20,000,000) for operation purposes.
The loans bear interest rates ranging from 4.8% to 5.0% with the maturity dates in March and April 2021.

The following summarizes
the key components of our cash flows for the six months ended June 30, 2020 and 2019 and for the years ended December 31, 2019
and 2018.

For the Six
Months Ended
June 30
For the Years
Ended
December 31
2020 2019 2019 2018
(Unaudited) (Unaudited)
Net cash (used in) provided
by operating activities
$(1,246,977) $1,472,302 $6,321,227 $(1,162,798)
Net cash
used in investing activities
(924,117 ) (930,356 ) (2,037,364 ) (55,324 )
Net cash (used in) provided
by financing activities
(83,788 ) (226,552 ) (3,445,761 ) 2,431,084
Effect of exchange rate
change
(40,808 ) 409 (40,048 ) (123,997 )
Net change in cash $ (2,295,690 ) $ 315,803 $ 798,054 $ 1,088,965

Operating activities

Net cash used in
operating activities was approximately $1.2 million for the six months ended June 30, 2020 and was primarily attributable to the
increase of accounts receivables of approximately $2.6 million as we experienced a longer collection cycle from credit sales,
which was caused by staffing shortages. As the COVID-19 pandemic has adversely impacted
our business operations and that of our customers, we experienced a longer collection cycle.
The cash outflow was also attributable to the decrease of accounts payables of approximately $0.6 million. Cash flow used
in operating activities was offset by net income of approximately $1.6 million and various non-cash items of approximately $0.4
million, such as depreciation and amortization expense, provision for allowance for doubtful accounts, and deferred tax expense.

Net cash provided
by operating activities was approximately $1.5 million for the six months ended June 30, 2019 and was primarily attributable to
net income of approximately $2.0 million and various non-cash items of approximately $0.3 million, such as depreciation and amortization
expense, provision for allowance for doubtful accounts, and deferred tax expense. Cash inflow was offset by the increase of account
receivables of approximately $0.3 million as we granted more credit sales to existing customers.

Net cash provided
by operating activities was approximately $6.3 million for the year ended December 31, 2019 and was primarily attributable to
net income of approximately $5.1 million and various non-cash items of approximately $0.6 million, such as depreciation and amortization
expense, provision for allowance for doubtful accounts, and deferred tax expense. The cash inflow was also attributable to the
decrease of accounts receivables of approximately $1.4 million as we have taken more measures to collect outstanding balances.

Cash inflow was offset
by the decrease of deferred revenue of approximately $0.8 million as we granted more credit sales to existing customers and the
decrease of accounts payable of approximately $0.1 million as we have more operating cash flow to pay off our liabilities.

Net cash used in
operating activities was approximately $1.2 million for the year ended December 31, 2018 and was primarily a result of cash inflow
from net income of approximately $2.4 million and various non-cash items of approximately $0.3 million, such as depreciation and
amortization expense, provision for allowance for doubtful accounts, and deferred tax expense. Cash inflow was offset by the decrease
of accounts payable of approximately $1.7 million and the decrease of other payables and accrued liabilities of approximately
$2.2 million. As we obtained approximately $3.0 million in short-term bank loans, we were able to pay off our trade and other
liabilities more timely.

Investing activities

Net cash used in
investing activities was approximately $0.9 million for the six months ended June 30, 2020 and was primarily attributable to approximately
$0.9 million of salary and benefits payment on capitalized software.

Net cash used in
investing activities was approximately $0.9 million for the six months ended June 30, 2019 and was primarily attributable to approximately
$0.4 million of salary and benefits payment on capitalized software and approximately $0.5 million payment on equipment and construction
in progress.

Net cash used in
investing activities was approximately $2.0 million for the year ended December 31, 2019 and was primarily attributable to approximately
$1.5 million of salary and benefits payment on capitalized software and approximately $0.6 million payment on equipment and construction
in progress.

Net cash used in
investing activities was approximately $55,000 for the year ended December 31, 2018 and was primarily attributable to approximately
$0.5 million of salary and related payments on capitalized software, and approximately $0.2 million payment on equipment, offset
by repayments from related party of approximately $0.6 million.

Financing activities

Net cash used in
financing activities was approximately $0.1 million for the six months ended June 30, 2020 and was primarily attributable to approximately
$0.1 million in payments of deferred offering costs as we continue the process of becoming a publicly traded company in the United
States.

Net cash used in
financing activities was approximately $0.2 million for the six months ended June 30, 2019 and was primarily attributable to approximately
$0.2 million in repayment to related parties, and repayment of short-term bank loans of approximately $2.9 million, offset by
proceeds received from short-term bank loans of approximately $2.9 million.

Net cash used in
financing activities was approximately $3.4 million for the year ended December 31, 2019 and was primarily attributable to approximately
$1.3 million in repayment to related parties, approximately $1.8 million payment of acquisition of noncontrolling interests, payments
of deferred offering costs of approximately $0.4 million and repayment of short-term bank loans of approximately $2.9 million,
offset by proceeds received from short-term bank loans of approximately $2.9 million.

Net cash provided
by financing activities was approximately $2.4 million for the year ended December 31, 2018 and was a result of approximately
$0.2 million in capital contributions from our shareholders, proceeds from short-term bank loans of approximately $3.0 million
from Bank of Beijing, and proceeds from a short-term loan provided by a related party of approximately $76,000, offset by repayments
to related parties of approximately $0.9 million.

Commitments and Contingencies

Capital expenditures

Our capital expenditures
were incurred primarily in connection with payment of property and equipment and software. Our capital expenditures were approximately
$0.9 million in the six months ended June 30, 2020 and 2019. Our capital expenditures were approximately $2.1 million and $0.6
million in the years ended December 31, 2019 and 2018, respectively. We are in the process of constructing a cloud computing facility
in Guiyang, China. The facility is expected to have two buildings consisting of approximately 43,000 square meters in total, which
is expected to house our cloud and BPO services operations and also fulfill the purposes of offices, research centers, logistics
and employee dormitories. This facility is intended to replace our current facilities in Guiyang and some of our facilities in
Beijing and Hefei, China, which are currently leased. We have completed demolition, underground structure and design. We are currently
awaiting approval from the relevant governmental authorities to begin construction, and we expect the costs to complete the facility
will be approximately $10 million. As we are in the process of selecting contractors, we had no material existing capital expenditure
commitments as of June 30, 2020 or December 31, 2019. We intend to fund our future capital expenditures with our existing cash
balance, cash generated from operating activities and net proceeds from this offering. We are currently awaiting approval from
the relevant governmental authorities and expect to begin construction within three months following such approval, and the project
is estimated to be completed by August 2022. We will continue to make capital expenditures to meet the expected growth of our
business.

Lease commitments

We entered into fourteen
non-cancellable operating lease agreements for nine offices and five employee dormitories for the six months ended June 30, 2020.
Our commitment for minimum lease payments under the ten remaining operating leases as of June 30, 2020 for the next five years
is as follows:

Twelve months ending June
30,
Minimum lease payment
2021 $ 342,290
2022 211,953
Thereafter
Total minimum payments required $ 554,243

Contingencies

From time to time,
we are party to certain legal proceedings, as well as certain asserted and un-asserted claims. Amounts accrued, as well as the
total amount of reasonably possible losses with respect to such matters, individually and in the aggregate, are not deemed to
be material to the consolidated financial statements.

On July 20, 2012,
Infobird Anhui signed a leasing agreement with Hefei Shushan Economic Development District Management Committee, or Hefei Shushan,
to lease certain properties in the industry park managed by Hefei Shushan. A supplemental agreement was subsequently signed on
August 6, 2012 which amended the term of the lease and provided certain incentives and subsidies to Infobird Anhui. In June 2019,
Hefei Shushan filed a lawsuit in Shushan District People’s Court against Infobird Anhui claiming the incentives and subsidies
provided to Infobird Anhui was indeed a loan and Infobird Anhui was in default of loan contract of approximately $0.9 million
(RMB 6,400,000). On August 1, 2019, Shushan District People’s Court issued a civil judgment against Hefei Shushan. Hefei
Shushan subsequently filed an appeal in Anhui Province Hefei City Intermediary People’s Court. The Court ruled against Hefei
Shushan on December 3, 2019. The case was concluded and no contingent loss was recorded on our consolidated financial statements.

Contractual Obligations

In the normal course
of business, we are subject to loss contingencies, such as legal proceedings and claims arising out of our business, that cover
a wide range of matters, including, among others, government investigations and tax matters. In accordance with ASC No. 450-20,
“Loss Contingencies”, we will record accruals for such loss contingencies when it is probable that a liability has
been incurred and the amount of loss can be reasonably estimated.

The following table
summarizes our contractual obligations as of June 30, 2020:

Payments due by period
Contractual obligations Total

Less
than 1

year

1 – 3 years 3 – 5 years

More
than 5

years

Short-term loans – banks $ 2,830,816 $ 2,830,816 $ $ $
Operating lease obligation 554,243 342,290 211,953
Total $ 3,385,059 $ 3,173,106 $ 211,953 $ $

Off-Balance Sheet Arrangements

We have no off-balance
sheet arrangements including arrangements that would affect our liquidity, capital resources, market risk support and credit risk
support or other benefits.

Critical Accounting Policies and Estimates

Our financial statements
and accompanying notes have been prepared in accordance with U.S. GAAP. The preparation of these financial statements and accompanying
notes requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses,
and related disclosure of contingent assets and liabilities. We base our estimates on historical experience and on various other
assumptions that are believed to be reasonable under the circumstances, the results of which form the basis of making judgments
about the carrying values of assets and liabilities that are not readily apparent from other sources. We have identified certain
accounting policies that are significant to the preparation of our financial statements. These accounting policies are important
for an understanding of our financial condition and results of operation. Critical accounting policies are those that are most
important to the portrayal of our financial conditions and results of operations and require management’s difficult, subjective,
or complex judgment, often as a result of the need to make estimates about the effect of matters that are inherently uncertain
and may change in subsequent periods. Certain accounting estimates are particularly sensitive because of their significance to
financial statements and because of the possibility that future events affecting the estimate may differ significantly from management’s
current judgments. While our significant accounting policies are more fully described in Note 2 to our consolidated financial
statements included elsewhere in this registration statement, we believe the following critical accounting policies involve the
most significant estimates and judgments used in the preparation of our financial statements.

Use of Estimates and Assumptions

The preparation of
consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated
financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates
reflected in our consolidated financial statements include the useful lives of plant and equipment and intangible assets, capitalized
development costs, impairment of long-lived assets, allowance for doubtful accounts, revenue recognition, allowance for deferred
tax assets and uncertain tax position. Actual results could differ from these estimates.

Revenue Recognition

In May 2014, the
Financial Accounting Standards Board, or FASB, issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)”,
or ASU 2014-09. ASU 2014-09 requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer
of promised goods or services to customers. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when
it becomes effective and permits the use of either the retrospective or cumulative effect transition method. We adopted Topic
606 on January 1, 2018 using the modified retrospective transition method, and the adoption did not have a material impact on
our consolidated financial statements.

We recognize revenue
which represents the transfer of goods and services to customers in an amount that reflects the consideration to which we expect
to be entitled in such exchange. We identify contractual performance obligations and determines whether revenue should be recognized
at a point in time or over time, based on when control of goods and services are provided to customers.

We use a five-step
model to recognize revenue from customer contracts. The five-step model requires us to (i) identify the contract with the customer;
(ii) identify the performance obligations in the contract; (iii) determine the transaction price, including variable consideration
to the extent that it is probable that a significant future reversal will not occur; (iv) allocate the transaction price to the
respective performance obligations in the contract; and (v) recognize revenue when (or as) we satisfy the performance obligation.

We derive our revenues from sales contracts
with our customers with revenues being recognized upon performance of services. Our contracts with customers generally do not
include a general right of return relative to the delivered products or services. We applied practical expedient when sales taxes
were collected from customers, meaning sales tax is recorded net of revenue, instead of cost of revenue, which are subsequently
remitted to governmental authorities and are excluded from the transaction price.

Revenue recognition
policies for each type of revenue stream are as follow:

Revenue from customized
cloud-based services

We generate revenue
from customized cloud-based customer engagement software which includes customized SaaS, voice/data plan, which includes telecommunication
usage such as telephone calls and messaging that our customers can subscribe for, and technical support. The provision of customized
SaaS, voice/data plan and technical support is considered as one performance obligation as the services provided are not distinct
within the context of the contract whereas the customer can only obtain benefit when the services are provided together. We use
monthly utilization records based on the number of user accounts subscribed for by customers, an output measure, to recognize
revenue over time as there is simultaneous consumption and delivery of services. As of June 30, 2020 and December 31, 2019, we
derived all of our customized cloud-based revenues from China Guangfa Bank. We have previously entered into contracts with China
Guangfa Bank where the amounts charged per user account were fixed and determinable, and the specific terms of the contracts were
agreed to by us and China Guangfa Bank. Contract performance periods are generally fifteen months, and payment terms are generally
a specified percentage prepaid based on estimated usage, and the remaining to be billed monthly based on actual usage. Contracts
generally do not contain significant financing components or variable consideration. The latest customized cloud-based services
contract and telecommunications services contract with China Guangfa Bank expired on June 30, 2020 and December 31, 2020, respectively,
and such contracts have not been renewed by China Guangfa Bank. See “Risk Factors—Risks Related to Our Business and
Industry— We generate a significant portion of our revenues primarily from a single major customer, China Guangfa Bank,
which accounted for 75.5% and 77.3% of our total revenues for the six months ended June 30, 2020 and for the year ended December
31, 2019, respectively, and loss of business from such customer could reduce our revenues and significantly harm our business”
for additional information.

Revenue from standard
cloud-based services

We provide standard
cloud-based solutions that provide customers the right to access our software through the internet. Our cloud-based solutions
represent a series of services such as calling, voice recording and technical support. These services are made available to the
customer continuously throughout the contractual period, however, the extent to which the customer uses the services may vary
at the customers’ discretion. The standard cloud-based services are considered to have one single performance obligation.
We use monthly utilization records based on the number of user accounts subscribed for by customers, an output measure, to recognize
revenue over time as there is simultaneous consumption and delivery of services. We also had some contracts with customers where
the customer subscribes for a fixed number of user accounts over certain periods as specified in the contracts, therefore the
customer receives and consumes the benefits of the cloud services throughout the contract periods so revenue is recognized ratably
over the contractual period that the services are delivered, beginning on the date the service is made available to the customers.
Contract performance periods generally are one year, and pursuant to the contracts, full payments are generally collected in advance,
with payment to be made within three months after execution of the contract. Contracts generally do not contain significant financing
components or variable consideration.

Revenue from BPO
services

Revenue from BPO
services is generated from assisting customers to operate the call centers services. Customers using these services are not permitted
to take possession of our software and physical resources and the contract is for a defined period, where customers pay a monthly
service fee. These services are considered as one performance obligation as the customers does not obtain benefit for each separate
services. Revenues are recognized over time over contractual period using the time elapsed output method as BPO services are provided.
Contract performance periods generally are one year, and pursuant to the contracts, full payments for several months of services
are generally collected in advance. Contracts generally do not contain significant financing components or variable consideration.

Professional services
and other revenues

We also generate
revenue from data analysis services and other professional services. The service revenue from data analysis services and other
professional services is recognized over time as services are performed and delivered to customers. Contract performance periods
generally range from month to month, completion of service (software license) to one year, and payment terms are generally prepaid
to 30 days. Contracts generally do not contain significant financing components or variable consideration.

Contract balances

We record receivables
related to revenue when we have an unconditional right to invoice and receive payment.

We invoice our customers
for our services on a monthly basis. Deferred revenue consists primarily of customer billings made in advance of performance obligations
being satisfied and revenue being recognized.

Cost of revenues

Cost of revenues
consists primarily of personnel costs (including salaries, social insurance and benefits) for employees involved with our operations
and products and services support, third party service fees including cloud and data usage, hosting fees, and amortization and
depreciation expenses associated with our capitalized software, platform system and hardware. In addition, cost of revenues also
include outsourcing contracted customer service representatives, customer surveys and allocated share costs, primarily including
facilities, information technology and security costs.

Accounts receivable, net

Accounts receivable
include trade accounts due from customers. Accounts are considered overdue after thirty (30) days. In establishing the required
allowance for doubtful accounts, management considers historical collection experience, aging of the receivables, the economic
environment, industry trend analysis, and the credit history and financial conditions of the customers. We review our receivables
on a regular basis to determine if the bad debt allowance is adequate, and adjust the allowance when necessary. Delinquent account
balances are written off against allowance for doubtful accounts after management has determined that the likelihood of collection
is not probable.

Intangible assets

Our intangible assets
with definite useful lives primarily consist of licensed software, capitalized development costs, platform system, and land-use
rights. We amortize our intangible assets with definite useful lives over their estimated useful lives and reviews these assets
for impairment. We typically amortize our intangible assets with definite useful lives on a straight-line basis over the shorter
of the contractual terms or the estimated useful lives.

Capitalized development
costs

We follow the provisions
of ASC 350-40, “Internal Use Software”, to capitalize certain direct development costs associated with internal-used
software. ASC 350-40 provides guidance on capitalization of the costs incurred for computer software developed or obtained for
internal use. We expense all costs incurred during the preliminary project stage of development and capitalize costs incurred
during the application development stage. Costs incurred relating to upgrades and enhancements to the application are capitalized
if it is determined that these upgrades or enhancements add additional functionality to the application. Development costs cease
capitalization upon completion of all substantial testing when the software is substantially complete and ready for its intended
use and are amortized on a straight-line basis over the estimated useful life, which is generally five years. Amortization of
internal-use software begins when the software is ready for its intended use. We evaluate the useful lives of these assets on
an annual basis and test for impairment whenever events or changes in circumstances occur that could impact the recoverability
of these assets.

Land use rights

All land in the PRC
is owned by the government. However, the government grants “land use rights.” The land use rights are for 40 years
and expire in 2055. We amortize the land use rights over the forty-year term of the land use rights on a straight-line basis.
The carrying value of the land use rights was reduced by government grant received when the conditions stipulated under the grant
were fulfilled.

On June 3, 2015,
Infobird Guiyang signed a cloud computing development agreement with the local Guiyang government to promote development of the
local cloud computing industry. We obtained 40-year land use rights in Guiyang, China for 9,760.8 square meters of land for approximately
$4.7 million (RMB 32,532,746) through public bidding. The land is for building of technology related infrastructure only. In return,
the Guiyang government will subsidize the cost of land through a form of cash grant in the amount of approximately $4.5 million
(RMB 31,068,626). We received such grant in 2015. The grant was given to promote the local cloud computing industry, there are
no services to perform on our part, and the grant was given without restriction. The only condition is that the land use right
acquired was to be used for the cloud computing industry only. We recorded the grant as a reduction of the cost of related land
use rights. See “Capital Expenditures” above for further information.

Income taxes

We account for current
income taxes in accordance with the laws of the relevant tax authorities. The charge for taxation is based on the results for
the fiscal year as adjusted for items, which are non-assessable or disallowed. It is calculated using tax rates that have been
enacted or substantively enacted by the balance sheet date.

Deferred taxes are
accounted for using the asset and liability method in respect of temporary differences arising from differences between the carrying
amount of assets and liabilities in the consolidated financial statements and the corresponding tax basis used in the computation
of assessable tax profit. In principle, deferred tax liabilities are recognized for all taxable temporary differences. Deferred
tax assets are recognized to the extent that it is probable that taxable profit will be available against which deductible temporary
differences can be utilized. Deferred tax is calculated using tax rates that are expected to apply to the period when the asset
is realized or the liability is settled. Deferred tax is charged or credited in the income statement, except when it is related
to items credited or charged directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets
are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of
the deferred tax assets will not be realized. Current income taxes are provided for in accordance with the laws of the relevant
taxing authorities. We present deferred tax assets and liabilities as noncurrent in the balance sheet based on an analysis of
each taxpaying component within a jurisdiction.

An uncertain tax
position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained
in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit
that is greater than 50% likely of being realized on examination. For tax positions not meeting the “more likely than not”
test, no tax benefit is recorded. No penalties and interest incurred related to underpayment of income tax are classified as income
tax expense in the period incurred. PRC tax returns filed in 2019 are subject to examination by any applicable tax authorities.

Recent Accounting Pronouncements

See note 2 of our
notes to the consolidated financial statements for a discussion of recently issued accounting standards.

Quantitative and Qualitative Disclosures
about Market Risk

Inflation risk

Inflationary factors,
such as increases in personnel and overhead costs, could impair our operating results. Although we do not believe that inflation
has had a material impact on our financial position or results of operations to date, a high rate of inflation in the future may
have an adverse effect on our ability to maintain current levels of gross margin and operating expenses as a percentage of sales
revenue if the revenues do not increase with such increased costs.

Interest Rate Risk

We are exposed to
interest rate risk while we have short-term bank loans outstanding. Although interest rates for our short-term loans are typically
fixed for the terms of the loans, the terms are typically twelve (12) months and interest rates are subject to change upon renewal.

Credit Risk

Credit risk is controlled
by the application of credit approvals, limits and monitoring procedures. We manage credit risk through in-house research and
analysis of the Chinese economy and the underlying obligors and transaction structures. We identify credit risk collectively based
on industry, geography and customer type. In measuring the credit risk of our sales to our customers, we mainly reflect the “probability
of default” by the customer on its contractual obligations and consider the current financial position of the customer and
the current and likely future exposures to the customer.

Liquidity Risk

We are also exposed
to liquidity risk, which is risk that we will be unable to provide sufficient capital resources and liquidity to meet our commitments
and business needs. Liquidity risk is controlled by the application of financial position analysis and monitoring procedures.
When necessary, we will turn to other financial institutions and related parties to obtain short-term funding to cover any liquidity
shortage.

Foreign Exchange Risk

While our reporting
currency is the U.S. dollar, almost all of our consolidated revenues and consolidated costs and expenses are denominated in RMB.
All of our assets are denominated in RMB. As a result, we are exposed to foreign exchange risk as our revenues and results of
operations may be affected by fluctuations in the exchange rate between the U.S. dollar and RMB. If the RMB depreciates against
the U.S. dollar, the value of our RMB revenues, earnings and assets as expressed in our U.S. dollar financial statements will
decline. We have not entered into any hedging transactions in an effort to reduce our exposure to foreign exchange risk.

BUSINESS

Overview

We are a software-as-a-service,
or SaaS, provider of innovative AI-powered, or artificial intelligence enabled, customer engagement solutions in China. Leveraging
self-developed cloud-native architecture, AI and machine learning capabilities, patented Voice over Internet Protocol or VoIP
application technologies, no-code development platform, and in-depth industry expertise, we primarily provide holistic software
solutions to help our corporate clients proactively deliver and manage end-to-end customer engagement activities at all stages
of the sales process including pre-sales and sales activities and post-sales customer support. We also offer AI-powered cloud-based
sales force management software including intelligent quality inspection and intelligent training software to help our clients
monitor, benchmark and improve the performances of agents. We empower our clients with our business value-driven solutions to
increase revenue, reduce cost, and enhance customer service quality and customer satisfaction. We currently specialize in serving
corporate clients in the finance industry and also cover a broad array of other industries, including the education, public services,
healthcare and consumer products industries. We believe we are one of the leading and long-standing domestic SaaS providers in
serving large enterprises in the finance industry in customer engagement with over 10 years of experience. We offer a comprehensive
portfolio of customer engagement SaaS solutions that are highly intelligent, customizable and with proof of stability and security
at scale with concurrence of over 10,000 agents. We continue to innovate by developing technologies that enable us to deliver
a series of solutions and services which address the evolving and changing needs of our corporate clientele.

According to the
Report on the Industry Trend of SaaS in China published by Business Partner Consulting in March 2020, the SaaS industry
is a fast-growing market in China, surging from approximately $2.3 billion in 2019 to $3.3 billion in 2020, and is expected to
grow to approximately $6.9 billion in 2022. We believe the growth of the SaaS industry is driven by the digital transformation
in the business world, in particular domestic PRC markets, and in particular, we believe that companies are investing significantly
in SaaS during such digital transformation. We also believe AI-powered customer engagement SaaS is disrupting traditional customer
engagement tools. The former proactively extracts, consolidates, analyzes, and predicts customer interactions in an omni-channel
environment with the assistance of AI, while the latter passively receives, records, reacts to, and reports on customer data without
the assistance of AI. We believe that a combination of industry expertise on SaaS and novel technologies, such as AI and machine
learning capabilities, is the progressing trend in the customer engagement industry.

We rely on the following
self-developed novel technologies to deliver customizable, high-quality, scalable, configurable, secure, and steady customer engagement
solutions.

· Cloud-native
architecture.
We use a cloud-native architecture as the basic infrastructure for our software, which empowers us with
flexible scale-out capabilities and high tolerance of failures and default, and supports ultra-large-scale concurrence capabilities.
· AI
and machine learning capabilities.
We incorporate our self-developed natural
language processing, or NLP, licensed automatic speech recognition, or ASR, and text
to speech, or TTS, to empower our software to have the capability of conducting multiple
rounds of free conversations with customers, referring to the context for better understanding,
automatically capturing key words, recognizing the intentions of customers and accurately
converting voice to text or vice versa.
· Patented
VoIP technologies.
Our patented VoIP technologies ensure high-quality telecommunications
through intelligent routing, multi-voice coding support, and multi-endpoint access support.
The intelligent routing and multi-voice coding support enable us to provide optimal voice
transmission quality by monitoring network fluctuation to deploy voice routing notes
and adjusting voice coding based on the latest status of network bandwidth.
· No-code
development platform.
We developed a no-code development platform that is flexible
by design, enabling us to deploy pre-coded microservice modules and packages to quickly
respond and adjust to customer requirements, and we can also combine microservice modules
into customized end-to-end solutions, and thus, significantly reduce the time required
for our software engineers to program customized services and products for our clients.
Our software developed through the no-code development platform also supports open application
programming interface, or API, and software development kit, or SDK, and therefore allows
easy integration with our clients’ call centers, websites and software.

Our customer engagement
services are founded on a series of our customer engagement software, and each may be used on an individual and/or integrated
basis. The following are the primary types of our fundamental software:

AI Customer Engagement Software

· Cloud
call center
– proprietary technologies that ensure scalable, steady, secure,
and flexible access to accounts and also support functions which can automatically initiate
outbound calls by taking into account available agents, anticipated talk time, and anticipated
wait time, and then distribute the answered calls to the agents.
· Intelligent
telemarketing
– automatically initiate calls in batch files, which are files
often used to help load programs, run multiple processes at a time, and perform
common or repetitive tasks, support AI voice Chatbot and collect information from interactions
between sales representatives and customers to create labels for each customer and to
analyze and predict customer behaviors.
· Intelligent
omni-channel customer service
– integrate interactions through telephone calls,
videos, emails, social media platforms, websites, and text messages, and provide tickets
that can promote business flows across different departments.
· AI
voice Chatbot and AI text Chatbot
– multiple rounds of free conversation with customers,
referring to the context for better understanding, and recognizing the intentions of
customers.

AI Sales Force Management Software

· Intelligent
quality inspection
– monitoring and benchmarking performances of sales and
customer service representatives, and aiding in the fulfillment of obligations under
compliance regulations.
· Intelligent
training
– interactive training sessions and tests with computers for sales
and customer service representatives

We design our software
to be easy to use, customizable and self-operated. We allow our clients to incorporate their business needs and/or approach to
customer management in our software by using our self-developed no-code programming technology. Clients may also configure certain
parameters and scripts for agents. Our software also allows easy integration with our clients’ call centers, websites and
software. Through years of experience serving our clients and analyzing the interactions between our clients and their customers,
we have accumulated valuable vertical knowledge and know-how of our clients’ industries. We continually strive to understand
the objectives of our clients at different stages of their businesses to further our understanding on their operating industries.
We have integrated this knowledge with our technology to develop software that provides a comprehensive customer experience.

We value our proprietary
technologies and strong research and development capabilities, which we believe differentiate us from other software companies
in the customer engagement industry. As of December 31, 2020, we had an intellectual property portfolio consisting of 19 patents,
13 patents in various stages of the registration application process, 51 software copyrights, 1 artwork copyright in the registration
application process, 39 registered trademarks, 5 trademark applications and 27 domain names in the PRC and 3 registered trademarks
outside of the PRC.

Our research and
development department was composed of 122 personnel, including software engineers and internet technology specialists, as of
December 31, 2020, which accounted for approximately 40.0% of our total employees. We have invested significantly in research
and development and intend to continue to do so. For the six months ended June 30, 2020 and the years ended December 31, 2019
and 2018, our research and development expenses amounted to approximately $0.7 million, $1.5 million and $3.0 million, respectively.

As of June 30,
2020, we had over 10,000 paid user accounts from 358 customers for our SaaS services – standard cloud-based services (330 customers)
and customized cloud-based services (1 customer), BPO services (15 customers) and other services (including sales of software
license, data analysis services and other professional services) (12 customers). Our clients are companies and organizations,
primarily in the finance, education, public services, healthcare, and consumer products industries. Our ability to maintain close
relationships with our clients is essential to the growth and profitability of our business. Through constant technological innovation
and accumulated vertical knowledge in our clients’ industries, we continue to build strong relationships with our clients.
Once a client utilizes our solutions, we subsequently seek to deepen such relationships through cross-selling and upselling our
services and products. We deploy both direct and indirect sales approaches, including outreach by our sales team, organizing and
participating in forums and seminars, online advertising, and cooperating with referral and reseller partners. The majority of
our sales team is based in four major cities in China: Beijing, Shanghai, Guangzhou, and Guiyang, which cover the most developed
and populated cities of China.

We intend to further
expand our client base and increase our market share in the finance industry, as well as penetrating other industries with our
enhanced sales and marketing efforts. We plan to conduct a better client lifecycle management, expand our sales team, cooperate
with referral or reseller partners, continue to organize and participate in forums and seminars, launch online and offline advertising
campaigns, and improve our website and social media accounts. We also plan to attract new clients, and retain existing clients,
by continuing to innovate our products and services. In addition, we intend to construct the following capabilities in our AI
applications: customer engagement hub, one single view of customer, knowledge graphs, and customer journey maps, in order to facilitate
proactive customer engagement through consolidation of interactions with customers from various channels, including telephone,
email, social media platforms, websites and text messages, among others, along with predictions of customers’ intentions
and behaviors.

Industry Background

The SaaS industry
has been growing rapidly in China driven by the digital transformation in the business world and the favorable government policies.
According to the Report on the Industry Trend of SaaS in China published by Business Partner Consulting in March 2020,
the market size of the SaaS industry in China was approximately $2.3 billion in 2019 and grew to approximately $3.3 billion in
2020 at a compound annual growth rate of 43.5%. It is further estimated that the growth rate of SaaS industry will remain high
in the next two years and market size will grow to approximately $6.9 billion in 2022. The report also states that the industry
trend of SaaS is (i) to become more intelligent with artificial intelligence, or AI, and big data technologies; and (ii) to incorporate
industry expertise and vertically grow to penetrate markets in other industries including the finance, healthcare, education,
transportation, public services and retail industries.

The PRC government
has emphasized development and application of cloud computing, such as SaaS, and issued several supporting policy documents not
only on the big-picture level but also on the industry specific level. In July 2018, the Ministry of Industry and Information
Technology of the PRC, or the MIIT, issued the Three-year Action Plan for Expanding and Upgrading Information Consumption of
Enterprises (2018-2020)
and the Guidelines for Promoting Enterprises to Move Business to Cloud Platforms (2018-2020). The
former requires an increase on the scale of information consumption to reach approximately RMB 6.0 trillion (approximately $849.2
billion) by 2020, while the latter requires an additional one million enterprises in China to initiate digital transformation
and conduct business on cloud computing services in China by 2020. Regarding a specific industry, for instance, the finance industry,
People’s Bank of China issued the Development Plan for Financial Technology (FinTech) (2019-2021) in August 2019,
which stated the mission to upgrade the technologies applied in the finance industry, including cloud computing, AI, and big data
by 2021.

Businesses have been
investing heavily in digital transformation, with customer engagement as one of the largest areas of investment. AI-powered customer
engagement SaaS is disrupting the traditional customer engagement tools as the latter fails to satisfy the evolving needs of a
dynamic digital economy. The AI-powered customer engagement SaaS optimizes customers’ experiences and creates business value
by proactively extracting, consolidating, analyzing, and predicting customer interactions from an omni-channel environment. Conversely,
the traditional customer engagement tools passively receive, record, react to, and report on customer data. We believe that a
combination of industry expertise on SaaS and novel technologies, such as AI and machine learning capabilities, is the progressing
trend in the customer engagement industry.

The finance industry
has significant market potential in information technology, or IT, services, which includes SaaS. According to the industry report
released by Northeastern Securities in November 2019, the market potentials of IT services in the banking and insurance sectors
in 2018 were approximately RMB 111.7 billion (approximately $15.8 billion) and RMB 24.4 billion (approximately $3.5 billion),
respectively, and are expected to maintain an annual growth rate of over 20% in the next five years. International Data Corporation,
or IDC, predicted in 2019 that the total expenditures of Chinese financial institutions on IT will exceed $21.5 billion in 2020.

Artificial
Intelligence Industry in China

According to the
Baidu Brain Leadership White Paper jointly released by International Data Corporation, or IDC, and Baidu AI Industry Research
Center, as of March 2019, artificial intelligence technology is expected to penetrate various applications and business scenarios
of enterprises, which in turn is expected to inevitably change the traditional human resource structure, business processes and
industry structure of enterprises in China. IDC predicts that China’s AI market will reach $9.84 billion by 2022.

IDC tracked approximately
70 industry application scenarios and found that intelligent customer service was the most widely used service in various industries.
Furthermore, IDC found that automatic speech recognition technology and natural language understanding technology were the two
crucial AI technologies for intelligent customer service, which are also incorporated in our products. We believe our AI technologies
have great market potential and applications and are likely to increase the appeal of our SaaS products.

Our Competitive Strengths

We believe the following
competitive strengths differentiate us from our competitors and will continue to contribute to our success:

Advanced and
Proprietary Technologies.

Our products and
services are highly adaptable, scalable and supported by our flexible technology infrastructures, enabling us to efficiently address
the needs of our clients. As of December 31, 2020, we possessed 19 patents, 13 patents in various stages of the registration application
process and 51 software copyrights. Our technologies are all designed and deployed on our self-developed cloud-native architecture,
which can achieve flexible expansion and support ultra-large-scale concurrent applications. We have developed our proprietary
cloud-native communication technologies such as VoIP technologies. We believe our technologies can support flexible expansion
of services depending on our clients’ needs, ensure the stability and security of our software and make communication over
the internet easier and more convenient with better quality.

Innovative
No-code Development Platform

Our self-developed
cloud-based no-code development platform significantly reduces the software development period with relatively low cost and allows
us to quickly customize and package our SaaS to meet market demand. On the no-code development platform, our software engineers
program and store configurable, sharable, and scalable microservice modules and packages, which can be configured inwardly, composed
within each other or integrated into outside applications to create new software to handle new issues. We have built a database
of microservice modules and packages throughout the years serving our clients and continuously enhance existing microservice modules
and add new modules into our database to respond to the dynamic customer engagement market.

Rich Experience
in Serving Large Enterprises.

We believe we are
one of the leading and long-standing domestic SaaS providers in serving large enterprises in the finance industry in customer
engagement with over 10 years of experience. We believe we have also accumulated deep experiences in serving large enterprises
in other industries such as IT, retail and education industries. We offer a comprehensive portfolio of customer engagement SaaS
services that are highly intelligent, customizable and we ensure stability and security under large volume of services of concurrence
of over 10,000 agents. Our cloud native communication technology is capable of fault and disaster tolerance, and our no-code development
platform can support complex application integration as well as various types of API and SDK to better meet the changing needs
of large enterprises. We have accumulated valuable industry expertise, understanding client’s needs and compliance requirements
from business perspective rather than pure IT perspective, combining business plan with IT development plan. Monitoring the industry
trends, we continue to elevate the service level by improving our SaaS capability and providing new solutions, through upselling
or cross-selling, as the client’s business evolves. Further, we believe we are one of the leading domestic SaaS providers
in serving large enterprises in the finance industry in customer engagement primarily due to the following reasons:

The AI SaaS customer
engagement industry is a newly emerging industry
. There are few specific industry reports analyzing this industry. To our
knowledge, the domestic companies in this industry are all small- to medium-scaled private enterprises and there is no enterprise
that currently dominates this industry.

Infobird Beijing
was one of the first enterprises to enter the AI SaaS customer engagement industry in China, particularly in the finance industry.
Our services to China Guangfa Bank date back to 2011, and we believe this was one of the first cases of a large banking enterprise
adopting SaaS solutions in customer engagement in China. Even though we began small as a trial service for China Guangfa Bank,
we have successfully expanded the average monthly paid user accounts for China Guangfa Bank to over 6,000 for the six months ended
June 30, 2020. We believe this is a result of the excellent performance of our solutions and lack of replacement solutions that
are capable of supporting high concurrence of accounts on the cloud. Our experience with China Guangfa Bank is very rewarding
to us because we believe that we, together with our client, pioneered the market without realizing it at the time. Although the
latest customized cloud-based services contract and telecommunications services contract with China Guangfa Bank expired on June
30, 2020 and December 31, 2020, respectively, and such contracts have not been renewed by China Guangfa Bank, due to our long-lasting
relationship with China Guangfa Bank, we have been actively communicating with China Guangfa Bank to explore cooperative opportunities
involving our standard cloud-based services in other business lines, and in 2021 and beyond, we expect our revenues will not be
largely solely driven from a single major customer, and we expect our standard cloud-based services will constitute the major
portion of our fiscal year 2021 revenue as compared to customized cloud-based services.

We believe we
have proven our technological and service capabilities to serve demanding large financial enterprises in the long-term.
Due
to our self-developed cloud-native architecture, our products have flexible scale-out capabilities, high tolerance of failures
and default, and support ultra-large-scale concurrence capabilities. We believe our technological capability exceeds most of the
current domestic customer engagement SaaS providers since most providers use an open source to provide services. With an open
source, they typically have lower tolerance of failures and default and support a concurrence of approximately 2,000 agents with
one soft switch. Under the same conditions and with the same resources, we could provide high tolerance of failures and default
and can support a large volume of services of concurrence of over 10,000 agents with a cloud-native architecture. Even if such
providers added additional soft switch to support a concurrence of more agents, we believe there would still be problems with
timely response. In addition, based on feedback from our large financial enterprise clients, we believe we have successfully met
the high stability and service requirements of large financial enterprises.

Strong Relationships
with Clients, Industry Expertise and Diverse Client Base.

Our clients include
enterprises across a broad range of industries. We value our in-depth vertical knowledge in our clients’ industries, which
we believe enables us to better understand and predict the needs of our clients and their end users. In particular, we have accumulated
extensive experience in the finance industry, in which our largest clients operate in, and we have established strong relationships
with our clients due to our customer-centric culture. Our diversified customer base enables us to continually cross-sell and upsell
our products and services and to expand our market share.

Strong Research
and Development Capabilities.

We have invested
significant resources in research and development. For the six months ended June 30, 2020 and the years ended December 31, 2019
and 2018, our research and development expenses amounted to approximately $0.7 million, $1.5 million and $3.0 million, respectively.
We have built a strong research and development team and, as of December 31, 2020, we had a robust intellectual property portfolio
consisting of 19 patents, 13 patents in various stages of the registration application process, 51 software copyrights, 1 artwork
copyright in the registration application process, 39 registered trademarks, 5 trademark applications and 27 domain names in the
PRC and 3 registered trademarks outside of the PRC. As of December 31, 2020, our research and development team was composed of
122 personnel, including software engineers and internet technology specialists, which accounted for approximately 40.0% of our
total employees. Our research and development team has years of technology know-how in developing and launching products and services
in response to market demands. We believe this can lead to a shorter time to market which in turn may allow us to fully capture
opportunities presented by shifts in industry trends.

Award-winning
and Recognized Company.

We believe we have
built a trusted brand with a history of delivering value to our clients. We have received numerous industry, trade association
and governmental awards relating to our business and operations, which we believe serve to enhance our brand and reputation, including:

· Top 100
Global High-Tech Growth Company
by Red Herring (2008);
· Deloitte
Technology Fast 50 China
by Deloitte (2012);
· The Best
Cloud Computing Solutions, Cloud China
by the Ministry of Industry and Information
Technology of the PRC (2017);
· Best Solutions
in Cloud Customer Communication in China
by CCIDNet.com and “Internet Economy”
Magazine (2018);
· Top 100
Quasi Unicorn Company (Intelligent Cloud Customer Services)
by “China Internet
Week” of Chinese Academy of Sciences, Center for Informatization Study, and eNet
Research (2019); and
· Top
100 Artificial Intelligence Company
by “China Enterprise News” Group
and “China Internet Week” of Chinese Academy of Sciences (2019).

Visionary and
Experienced Management Team.

We have a visionary
and experienced management team with strong execution capability. We benefit from the extensive experience and expertise of our
management team, which has an average of over 20 years of experience. Multiple members of our key management team, who have many
years of experiences in vertical industries or very strong technological background, have worked with us for several years. We
believe our management team has enabled us to accumulate valuable operational experience, deep vertical knowledge and strong technological
expertise, while building and maintaining close relationships with our key clients. We believe that the extensive experience,
service and product knowledge, strategic vision and execution capabilities of our management team will allow us to continue to
execute our growth strategies to achieve a high level of success.

Our Strategies

Our mission is to
help our clients to make their customer engagement smart and personalized. Our goal is to become one of the leading customer engagement
SaaS providers in China. We aim to achieve this goal by implementing the following strategies:

Expand client
base in the finance industry with enhanced sales and marketing and solutions.

We have demonstrated
our capabilities to deliver a comprehensive portfolio of products and services at scale to large financial institutions. As more
market opportunities arise with the digital transformation and localization of cloud technologies deployment of key IT infrastructure
in the finance industry, we intend to acquire new clients and to cross-sell and/or upsell our AI-powered SaaS to existing clients.

We also intend to
recruit a group of sales personnel and consultants who have backgrounds in the finance industry and strong resources. Furthermore,
we will seek strategic partnerships with other service providers, including those that provide software services such as risk
management software services, with established relationships with financial institutions. We believe such strategic partnerships
will benefit us in acquiring new clients and will benefit such service providers in offering a more holistic solution in the open
bidding and invitation to tender processes and elevating the customer engagement services with our proprietary and novel technologies.

We intend to closely
track and pursue the SaaS open bidding and invitation to tender processes in the market. In particular, we have over 10 years
of industry experience providing customer engagement solutions in the finance industry. Our SaaS is capable of flexible scale-out
and has high tolerance for system failure due to our cloud infrastructure. We believe our successful track record has demonstrated
our quality of service and in-depth understanding of the finance industry, which we believe has established us as a competitive
candidate in the open bidding and invitation to tender processes for the provision of SaaS to financial institutions.

We will continue
to enhance our AI customer engagement solutions in the finance industry, in particular our AI Chatbots and intelligent quality
inspection software. For instance, we are in the process of further enhancing our AI capability in our intelligent quality inspection,
by leveraging our industry experiences, to assess the real time performances of the agents by automatically recording data from
their interactions with customers and therefore increasing customer satisfaction rate and net promotion rate. We believe by combining
our in-depth knowledge in the finance industry and our AI SaaS services, we can provide more business value-driven solutions to
help our existing and potential clients that are large financial institutions by continuing to improve our intelligent quality
inspection software in terms of its accuracy and efficiency, which is designed to support financial institutions to aid in the
fulfillment of their obligations under compliance regulations, and to input AI-driven models which can measure the performances
of agents.

Penetrate other
mature industries.

In addition to the
finance industry, we recognize that there are further opportunities in several other industries that are also facing the challenges
of digital transformation. We intend to focus on further penetrating the customer engagement market in more industries, such as
the healthcare and retail industries, in 2021 due to our experiences and the maturity and stability of such industries. We intend
to designate a team to segment potential clients in, and to compose customized proposals for, targeted industries based on their
needs and characteristics. We expect this approach will increase our client conversion rate in other industries. We also intend
to engage consultants with in-depth knowledge of these industries in the design of our solutions to ensure the appropriate customization
and applications.

Strengthen
sales and marketing.

We intend to strengthen
our sales and marketing efforts by conducting better lifecycle management of our clients, expanding our sales team, devoting more
resources to managing key clients, cooperating with referral and/or reseller partners (indirect sales channels), organizing and
participating in forums and seminars, launching online and offline advertising campaigns, and improving our website and social
media accounts. We also believe that an efficient form of sales and marketing is viral sales and marketing. Through continuous
improvement of our service quality and users’ experience, we rely on our satisfied users to contribute to strong word-of-mouth
marketing. We plan to strengthen our sales and marketing efforts by utilizing the following strategies, among others:

· Improve
clients’ lifecycle management.
We plan to conduct better client lifecycle
management, which includes analyzing customers’ information during the sales process,
managing post-sales customer services, concluding contract closures and implementing
further business opportunities, in order to keep track of the clients’ needs and
usage experiences, and therefore creating further opportunities to cross-sell and/or
up-sell to our clients. At the same time, we plan to put further effort into managing
our key clients and therefore enhancing key client value in the long run. We define our
key clients as mid to large enterprises or enterprises with large potential in their
respective industries. For key clients that use a small quantity of our products or services,
we plan to conduct site visits or carry out telephone conversations on a monthly basis
to keep track of their needs as well as obtain their user experiences regarding use of
our products and services, and then to manage and adjust our internal resources to provide
them with the appropriate level of service to foster improved business relationships
and to potentially create further sales opportunities of more value-added products and
services through cross-selling and/or up selling. For key clients that previously terminated
their usage of our products and services, we also intend to contact them to understand
their reasons for termination and then evaluate and prepare plans to regain potential
business opportunities to provide products and services to them in the near future.

· Expand
sales team.
We plan to recruit additional employees to expand our sales team
to approximately 50 sales representatives by the end of 2021. We also plan to allocate
our sales representatives to the existing four sales teams in Beijing, Shanghai, Guangzhou,
and Guiyang to cover a broad geographic market in the PRC. With an increased sales workforce,
we will be able to pursue further business opportunities with our key clients as well
as target additional new clients.

· Deploy
further indirect sales channels.
We plan to build or further expand on the strategic relationships with telecommunications
carriers, SaaS system integrators, and platforms of SaaS providers which will refer us to, or resell our services to, their
customers to further drive sales. We intend to establish cooperative relationships with several telecommunications carriers
that own and operate certain nationwide service telephone numbers. These nationwide service telephone numbers are assigned
by the MIIT to particular institutions, such as national and commercial banks and insurance enterprises. These carriers have
connections with some of the companies that may use our services and products. We also plan to partner with SaaS system integrators
with a focus in certain industries, including the finance, healthcare, and retail industries, to jointly deliver our services
to potential large enterprise customers. With platforms of SaaS providers, we partner with such providers on the basis that
we share similar target customers and offer supplementary services, For example, if the SaaS provider is already providing
financial collection services to a client, we can assist in providing AI-related services or customer services. Through open
API, our services can also be embedded with products of other software companies.

· Increase
brand awareness.
We intend to enhance our brand awareness by organizing and participating
in forums and seminars, launching online and offline advertising campaigns, and improving
our website and social media accounts. We also plan to continue to organize and participate
in well-known forums, conferences, and seminars in advanced technologies, such as artificial
intelligence and big data, as well as in our clients’ industries, such as the finance
industry, in order to obtain an updated in-depth insight of market demands and build
our brand image in China. Furthermore, we intend to engage independent third-party consulting
and rating companies to generate industry research reports on us. We believe such reports
will help increase our brand awareness. We also plan to launch advertising campaigns
in airport and railway stations, as well as through online channels. In addition, we
intend to continue to improve the content and design of our website and social media
accounts through which our clients can quickly understand our services and easily reach
our sales representatives.

Continue to
invest in research and development to further develop AI and machine learning capabilities.

We also intend to
continue focusing our research and development on upgrading our AI and machine learning capabilities in order to enhance our existing
service and product offerings and to incubate new technological breakthroughs and business initiatives. We intend to construct
the following capabilities in our AI applications to help predict customers’ intentions and behaviors: customer engagement
hub, one single view of customer, knowledge graphs, and customer journey maps.

· Customer
engagement hub:
An architectural framework that combines one single view of customer,
knowledge graphs, and customer journey maps to initiate proactive engagement with each
customer regarding timing, communication channel, and content as derived from the data
of previous interactions.

· One
single view of customer:
A consolidation of interactions with a particular customer
from all communication channels into one master database, along with records of information
and preferences of the customer, in an effort to offer consistent and timely information
and suggestions to the customer. As such, customers will not be required to repeat themselves
each time that they reach a different customer service representative as their records
will be stored in the one master database that can be accessed by all customer service
representatives.

· Knowledge
graphs:
A collection of interlinked descriptions of objects, events, situations
and abstract concepts, based on graph database technology. The knowledge graphs enable
our AI to better prioritize keywords and understand complicated sentences. A graph database
is a type of non-relational, or NoSQL, database that is suitable for very large sets
of distributed data. Instead of tables that are found in relational databases, a graph
database uses graph structures with nodes, properties and edges to represent and store
data. We plan to leverage the foundational technology of knowledge graphs from outside
providers and our own industry specific knowledge to design industry knowledge graphs.
We intend to invest human resources as well as use machine learning capabilities to organize
and summarize the industry knowledge. With the industry knowledge graphs, we expect to
be able to automatically and instantly provide personalized suggestions to our clients’
agents and end customers.

· Customer
journey maps:
Capabilities to understand the scenario a customer is in and predict
the upcoming behavior of the customer. Our algorithms, combined with a knowledge graph,
can provide dynamic analyses of the customer’s intentions and generate suggested
answers for our customer service representatives.

We plan to offer
an open API of our no-code development platform to our corporate clients and to third-party developers and integrators, allowing
them to integrate our pre-programed microservice modules and packages into their applications on a self-service basis combined
with their vertical knowledge in various industries in order to create new solutions. We hope to contribute to creating a customer
engagement ecosystem by empowering more solution providers to generate creative, industry-focused, and value-driven solutions
through our services and products.

Our Products and Services

We offer cloud-based
standard and customized customer engagement services with various SaaS and BPO services to corporate clients. Our customer engagement
services are generally categorized into (i) standard cloud-based services, which are our standard SaaS or assembly of some of
our fundamental SaaS to meet our clients’ needs, which generally requires less resources than our customized cloud-based
services, and (ii) customized cloud-based services, which involve preliminary research of clients’ businesses and their
objective of customer engagement, along with design, modification, and integration of some of our fundamental SaaS in order to
fit seamlessly with our clients’ actual business processes in a short period of time and with low cost through our no-code
development platform. Customized cloud-based services include customized SaaS, voice/data plan, which includes telecommunication
usage such as telephone calls and messaging that our customers can subscribe for, and technical support. Clients that use either
standard or customized cloud-based services generally enter into contracts that range between one to three years. Dependent on
the contractual arrangements, once a contract has been entered into, the clients are subscribed to our paid user accounts and
we will charge them either a one-off subscription fee or we will charge them based on the usage of our services.

The cornerstone of
our customer engagement cloud-based services is a series of customer engagement SaaS. Our SaaS is accessible from multiple types
of devices, including personal computers, tablets and mobile devices. We programmed our SaaS in the languages of Java, C++, PHP,
Objective-C and Python and to support and run on Windows, macOS, Linux, Android and iOS operating systems.

We offer the flexibility
of three methods of deployment of our SaaS: public cloud, hybrid cloud and private cloud. In a public cloud, we rent and leverage
cloud resources from third parties and therefore do not need to supply supporting infrastructure, such as hardware, storage, and
servers, and deliver the services over the internet to clients. Clients share the computing resources with others in the public
domain, which is the nature of public cloud services. In a private cloud, the infrastructure is physically located at a client’s
facility and the services are dedicated solely to such client. A hybrid cloud combines a private cloud with a public cloud. In
a hybrid cloud, data and applications can move between private and public clouds for greater flexibility and additional deployment
options. Upon clients’ requests, we also provide necessary hardware and middleware, which is software that provides services
to software applications beyond those available from the operating system, installation and maintenance services, and uptime monitoring
for our clients who choose hybrid and private clouds. We also maintain a technical support team that is responsible for installation
and maintenance. We procure or rent all infrastructure equipment from third parties. Our standard cloud-based services are typically
deployed on public clouds whereas our customized cloud-based services are typically deployed on hybrid or private clouds.

We have obtained
the national compliance operation qualification of internet information service provider and call center service provider from
the MIIT and its provincial level counterparts to conduct call center businesses. We have also obtained the international ISO27001
Certificate of Information Security Management System from China Cybersecurity Review Technology and Certification Center to meet
high cybersecurity standards required to conduct customer engagement services in certain industries such as the finance industry.

We have categorized
our primary SaaS into two groups: AI customer engagement software and AI sales force management software.

AI Customer
Engagement Software

Cloud Call Center

Our cloud call center
services are delivered over the internet. Our clients access their accounts and take inbound or outbound calls through applications
on mobile devices, tablets, and personal computers. Our cloud call center is our longest standing product and we take pride in
the stability and high quality of telephone calls, as well as the add-on services we have provided since its introduction, such
as intelligent interactive voice response, batch inbound or outbound calls, and recording. Infobird Beijing began as a cloud-based
call center-focused company. We believe our business is differentiated from other cloud call centers as a result of our all-software
approach and patented VoIP technologies. We utilize software throughout the process from session initiation, transmission and
switching to endpoints, which requires no physical investment on the client’s part and, at the same time, ensures a high
tolerance of failures and default and flexible scale-out capabilities, and supports ultra-large-scale concurrence capabilities.
By leveraging intelligent routing and multi-voice coding support, our VoIP technologies enable us to provide high voice transmission
quality by monitoring network fluctuation to deploy voice routing notes and adjusting voice coding to the latest status of network
bandwidth. To better meet user habits, we can also emulate the use of certain telephone service equipment, such as digitized telephone
sets and fax machines, with a VoIP network.

We also incorporate
the predictive dialing robot, a dialing robot that can help agents automatically dial numbers and transfer connected phone calls
to the next available agent, in our cloud call center, which can significantly increase the working efficiency of agents by reducing
the time spent on waiting for calls to be answered. It automatically initiates outbound calls by taking into account available
agents, anticipated talk time, and anticipated wait time, and then distributes the answered calls to the agents. Our clients often
further opt to configure the AI voice Chatbot with the predictive dialing robot in an attempt to increase efficiency and reduce
costs.

We have also embedded
data analytics in our cloud call center. It can provide insights of performances for our clients by generating charts that display
several items of key data such as number of calls, percentage of occupancy of agents, and level of satisfaction of customers.

Intelligent Telemarketing

Our intelligent telemarketing
software is a tool for initiating follow-up calls with sales leads. It utilizes our cloud call center and can be packaged with
other intelligent application software such as AI voice Chatbot and the predictive dialing robot. Our clients are able to automatically
initiate calls in batch files, starting the conversation with AI, and redirect prospective customers to sales representatives.
With our intelligent telemarketing software, our clients may reduce marketing costs by increasing the efficiency of sales representatives.
Depending on the clients’ needs, we also have the capability to collect information from the interactions between the sales
representatives and the customers to create labels for each customer and to analyze and predict customer behaviors.

Intelligent Omni-Channel Customer
Service

Our intelligent omni-channel
customer service software enables our clients to interact with their customers through common channels that individuals in the
China market typically use to communicate, including telephone calls, videos, websites, e-mails, social media platforms, such
as WeChat, a popular Chinese multi-purpose messaging, social media and mobile payment application, and Weibo, a popular Chinese
microblogging site, and text messages. This software creates a customer database and can label each customer with their properties
for screening. It also offers customizable worksheets and ticket management, which can be used to organize customer service issues
across different departments within the organization.

Our intelligent omni-channel
customer service software typically produces optimal outcomes when it is packaged with our intelligent application software, including
AI voice Chatbot, AI text Chatbot, intelligent form filling, and intelligent quality inspection. Intelligent form filling is an
important tool used for documenting interactions with customers and for communication between various departments within our corporate
clients. We collect information from the interactions and provide data analytics services that automatically generate summaries
of indicators of our client’s customer services. The summaries are fundamental for our clients to understand and improve
the performance of their customer service representatives.

AI voice Chatbot and AI text Chatbot

We have developed
two AI Chatbots that are voice-based and text-based. By leveraging AI technologies such as our self-developed natural language
processing, or NLP, licensed automatic speech recognition, or ASR, and text to speech, or TTS, our AI voice and text Chatbots
are able to perform various tasks while engaging in different scenarios in customer engagement such as announcing notifications,
obtaining confirmations, carrying out limited conversations, asking questions to collect basic information, and providing answers
to commonly raised questions. Our AI Chatbots can support the customer services and sales agents to increase the working efficiency
as they can carry out pre-programmed, simple and repetitive tasks automatically without human intervention. With designed work
flows, our AI Chatbots support human and AI collaborative working scenarios, for example, our AI Chatbots interact or carry out
conversations first to collect basic information and then transfer such information to human agents for further services. Both
AI voice and text Chatbots can be add-on software to our omni-channel customer service software or other companies’ software,
as they are embedded with open API, and they can also be independent software for sale. AI text Chatbot can help answer questions
using a text-based approach, and AI voice Chatbot can help answer questions using a voice-based approach.

After years of research
and development, our AI Chatbots also encompass advanced functions. For example, they can analyze real-time conversation, understand
conversation context and flows and proactively recommend products and services. Our AI voice Chatbot also has the capability to
recognize when the customer starts and finishes talking so it will not interrupt the customer. We also implement human voice recording
in our AI voice Chatbot, in particular in the finance industry.

AI Sales Force
Management Software

Intelligent Quality Inspection

Our intelligent quality
inspection software is designed to input AI-driven models which can measure the performances of agents and to support financial
institutions to aid in the fulfillment of their obligations under compliance regulations. Our intelligent quality inspection software
conducts mass quality inspection of recordings of conversations between agents and customers through AI and then generates results
and data analytics in minutes. The speed of inspection is cost sensitive and clients can choose their desired speed. The inspection
software examines multiple criteria of a recording including keywords, specific sentence pattern, speech speed, silence, call
duration, and interruptions. The criteria are highly customizable and we can combine multiple criteria to customize the intelligent
quality inspection software to serve in several scenarios.

We believe that our
intelligent quality inspection is highly efficient and thorough compared to traditional manual inspection. Companies that use
traditional manual inspection typically hire inspectors to sample the recordings and listen to each recording one by one. The
process can be expensive, time-consuming, and prone to error. However, with our intelligent quality inspection software, companies
can perform real-time inspections of all recordings. If our intelligent quality inspection software detects a violation of a specified
criteria, it will send a notification to the agent with an excerpt of the relevant portion of the recording within minutes. The
excerpt is also converted into text, with the violation denoted in red text, so that the agent is able to efficiently read a transcript
of the relevant text during the telephone call.

We also offer interactive
data analytics with intelligent quality inspection in order to empower our clients to monitor and benchmark the performances of
agents. For example, our clients can quantify the performances of agents by scoring recordings, listing the recurring violations,
or generating infographics showing violation trends over time.

Intelligent Training

Our intelligent training
software is designed for standardized training for sales representatives and customer service representatives. It may reduce costs
associated with training new recruits, providing online lectures and virtual tests, and interactive training with virtual customers.
It also allows customization in contents, management of training plans, and data analytics of test results.

The signature function
of our intelligent training software is the interactive training with virtual customers. By pre-programming training materials
in our interactive training section, it can simulate real-life interactions with a potential customer. For instance, the virtual
customer would begin by asking interactive questions with the newly recruited agents or existing agents that require further training.
After answering the interactive questions, the agents will receive a final score as well as detailed score for every question
answered during the training session. They will also be provided with the correct answer for each question they answered incorrectly.
This interactive training session can assist the management team in training newly recruited agents on a cost-efficient basis
and targeting specific areas that they aim to improve for agents’ performance by providing focused training sessions. It
can also provide the agents more training flexibility as it can be accessed on mobile phones and desktops, which can result in
skill improvement within a short time frame.

BPO Services

We provide BPO services
through utilization of the technologies used in our cloud call center and our experiences in customer engagement. BPO is the contracting
of business activities and functions to third-party providers, such as technical support, sales and marketing, customer service
and BPO operation management. Our BPO services consist of call center outsourcing operation services. We supply a full set of
resources for such services, including the physical space, physical agents, call center equipment, fixed line and internet network,
system management, maintenance and other services to meet our clients’ needs. Either way, clients can choose whether to
empower such call center with our intelligent application software. We also offer data analytics on qualified indicators of performances
of BPO for clients. Revenue from BPO services is generated from assisting customers to operate the call centers services. Customers
using these services are not permitted to take possession of our software and physical resources and the contract is for a defined
period, where customers pay a monthly service fee. For the six months ended June 30, 2020 and the year ended December 31, 2019,
our BPO service fees amounted to approximately $0.8 million and approximately $2.0 million, representing approximately 13.3% and
11.0% of our total revenues, respectively.

We have provided
BPO services exclusively through Infobird Guiyang, subsidiary of our VIE, since 2015. As of October 31, 2020, we employed 119
agents and outsourced 67 agents in connection with our BPO services, and we had over 65 corporate clients in the finance, consumer
products, and information technology services industries that utilized our BPO services.

Our Clients

As of June 30,
2020, we had over 10,000 paid user accounts from 358 customers for our SaaS services – standard cloud-based services (330 customers)
and customized cloud-based services (1 customer), BPO services (15 customers) and other services (including sales of software
license, data analysis services and other professional services) (12 customers). Our clients are companies and organizations,
primarily in the finance, education, public services, healthcare, and consumer products industries.

For the six months
ended June 30, 2020 and the years ended December 31, 2019 and 2018, China Guangfa Bank accounted for 75.5%, 77.3% and 76.7%, respectively,
of our total revenues. We have entered into services contracts with China Guangfa Bank since 2011. Our latest services contract
with China Guangfa Bank was effective on April 1, 2019 for a service period of fifteen months and expired on June 30, 2020. The
termination of the latest contract required mutual written consent from us and China Guangfa Bank. We were to provide China Guangfa
Bank access to the customized SaaS, which included telecommunications services, such as telephone calls and messaging, and technical
support. Billing for customized cloud-based services is generally as follows as: (i) a specified percentage prepayment based on
estimate usage each month; and (ii) monthly billing of the remaining balance based on actual monthly usage of different product
mix, and the payment term is generally a specified number of working days upon receipt of our invoice. China Guangfa Bank has
not renewed such agreement, and we and China Guangfa Bank are currently not operating under such agreement. In addition, we entered
into a separate services contract with China Guangfa Bank for the provision of data analysis and research services. The contract
had a three-year term from January 1, 2018 and expired on December 31, 2020. China Guangfa Bank could terminate this contract
at any time. Billing is generally done on a monthly basis based on the monthly output with a fixed price as specified in the contract,
and the payment term is generally a specified number of working days upon receipt of our invoice. China Guangfa Bank has not renewed
such agreement, and we and China Guangfa Bank are currently not operating under such agreement. We do not derive material amounts
of revenue from such expired telecommunications services agreement with China Guangfa Bank. We are negotiating with China Guangfa
Bank to provide new products and services to China Guangfa Bank. It is currently preliminarily anticipated that China Guangfa
Bank will account for less than 5%, approximately 30% and approximately 5% of the Company’s total revenues for the second
half of the 2020 fiscal year, the full 2020 fiscal year and the full 2021 fiscal year, respectively. In 2021 and beyond, we expect
our revenues will not be largely solely driven from a single major customer, and we expect our standard cloud-based services will
constitute the major portion of our fiscal year 2021 revenue as compared to customized cloud-based services.

In the second half
of the 2020 fiscal year, we retained our client base and actively enhanced our sales and marketing by increasing our team size
and marketing efforts in China. We have also been expanding our client base with our cloud-based call center and intelligent AI-powered
products and have obtained some new large contracts. Such new clients are primarily in the internet, BPO and telecommunications
industries. We have also been engaging with clients in the finance, healthcare, retail, and consumer products industries and have
entered into contracts with several of these clients. We believe these new contracts will increase our revenue for the 2021 fiscal
year while diversifying our client base.

Sales and Marketing

We deploy both direct
and indirect sales approaches to market our services to both existing and potential clients.

We utilize the direct
approaches with our sales team, which includes 37 sales representatives strategically located in four major geographic markets
in China: Beijing, Shanghai, Guangzhou, and Guiyang. We have currently recruited five experienced sales representatives with rich
resources in the industries we serve, including finance, and the industries we intend to focus on further serving, including healthcare,
who we believe can proactively create new sales leads. Our key sales representatives have served with us for over 10 years and
have profound knowledge of our services and the services of our large clients. Our sales team is also responsible for the renewal
of existing contracts and the promotion of new products to existing clients. Once we have established relationships with clients,
we subsequently seek to deepen such relationships through cross-selling and upselling our solutions, so that we become an integral
part of our clients’ operations.

We also cooperate
with various online advertising networks and have been promoting our services and products on widely used search engines in China
primarily to pursue small and mid-sized clients. The search engines will automatically forward the sales leads to our sales team
who will respond to the queries. Our sales team will continue to follow up with clients who have expressed interest in our services,
identify clients’ needs, and engage our software engineers to develop tailored proposals for our clients.

We also directly
engage clients through attending and organizing forums and seminars for senior management personnel in our targeted industries,
including the finance industry. During such forums and seminars, we initiate contact with such senior management to understand
their specific needs in customer engagement and develop customized solutions. For example, in May 2019, we organized the FINTECH
Intelligent Finance Forum of China International Big Data Industry Expo 2019 in Guiyang, sponsored by the Guiyang municipality
government, which attracted hundreds of attendees.

We have also adopted
indirect approaches to sales and marketing, such as relationships with telecommunications carriers. For example, we have established
relationships with certain telecommunications carriers that have immense client bases. Through proactive communication, the carriers
facilitate cooperation between us and their customers who have expressed needs in cloud-based customer engagement.

Generally, we focus
our sales and marketing efforts on increasing awareness of our company, establishing and promoting our brand, creating sales leads
and supporting our community of customers. We also work with multiple online media outlets to publish press releases about our
business, including our services and products and industry insights. We intend to continue to invest in sales and marketing by
expanding our sales team, managing clients’ lifecycles, cooperating with referral and reseller partners, engaging independent
third-party consulting and rating companies, organizing and participating in forums and seminars, launching online and offline
advertising campaigns, and improving our website and social media accounts.

Research and Development

We invest significant
resources in research and development—not only to support our existing business and enhance our service and product offerings—but
also to incubate new technological breakthroughs and business initiatives. As of December 31, 2020, our research and development
team consisted of 122 personnel, including software engineers and internet technology specialists, which accounted for approximately
40.0% of our total employees. We have invested significant resources to maintain our technological advantages and intend to continue
to extensively invest in our research and development capabilities. For the six months ended June 30, 2020 and the years ended
December 31, 2019 and 2018, our research and development expenses amounted to approximately $0.7 million, $1.5 million and $3.0
million, respectively.

Our Technologies

Our key technologies include the following:

· Cloud-native
architecture.
We believe we are one of the first SaaS companies in the customer engagement industry in China that
uses cloud-native architecture throughout the lifecycle of our software. Due to the self-developed cloud-native architecture,
our products have flexible scale-out capabilities, high tolerance of failures and default, and support ultra-large-scale concurrence
capabilities.
· AI
and machine learning capabilities.
Our software is capable of conducting multiple
rounds of free conversation with customers, analyzing the context for better understanding,
and automatically capturing key words and recognizing the intentions of customers. We
use self-developed NLP, licensed ASR and TTS.
· Patented
VoIP technologies.
Our patented VoIP technologies feature self-developed intelligent
routing, multi-voice coding support and multi-endpoint access support. The intelligent
routing and multi-voice coding support enable us to provide the most optimal voice transmission
quality by monitoring network fluctuation to deploy voice routing notes and adjusting
voice coding based on the latest status of network bandwidth. In addition, our patented
VoIP technologies are able to provide multi-endpoint access supports to mobile applications,
computer software, website, session initiation protocol, or SIP, soft-phone and hard-phone,
and simultaneously, support multi-endpoint software’s SDK and API, making it easily
integrated to third-party software.
· Self-developed
cloud-based no-code development platform.
Our self-developed cloud-based no-code
development platform allows us to quickly develop new SaaS, customize and package our
SaaS to meet market demand. Our no-code development platform fundamentally changes how
our software engineers develop new products. It is a “middle platform” where
our software engineers write codes and algorithms to generate microservice modules, further
integrate the modules to generate microservice packages, and store such pre-programmed
modules and packages. The microservice module is the smallest unit that a client can
use, and the microservice package is the smallest unit that a client can subscribe. All
of our modules and packages are configurable, sharable, and scalable. Our software engineers
can easily modify the parameters of the pre-programmed microservice modules and packages
and use drag-and-drop tools to configure the modules and packages to create new or customized
software. Therefore, our no-code development platform has significantly shortened the
time required to develop new products compared to the traditional way of going through
the complete lifecycle of software development from designing and coding every time.
We have built a database of microservice modules and packages that cover the recurring
issues throughout the years serving our clients and continuously enhance existing modules
and add new modules to respond to newly emerged market opportunities.

Intellectual Property

Our success and future
revenue growth depend, in part, on our ability to protect our intellectual property. We rely primarily on patent, copyright, trademark
and trade secret laws, as well as confidentiality procedures, to protect our proprietary technologies and processes.

We believe that the
core of our business is comprised of our proprietary technologies, including our patented VoIP and other internet technologies
and software copyrights. As a result, we strive to maintain a robust intellectual property portfolio. Our success and future revenue
growth may depend, in part, on our ability to protect our intellectual property as products and services that are material to
our operating results incorporate patented technology.

We have pursued rights
in intellectual property since our founding and we focus our intellectual property efforts in China. Our patent strategy is designed
to provide a balance between the need for coverage in our strategic market and the need to maintain reasonable costs.

We believe our rights
to patents, copyrights, trademarks and other intellectual property rights serve to distinguish and protect our products from infringement
and contribute to our competitive advantages. As of December 31, 2020, we had rights to 19 patents, 13 patents in various stages
of the registration application process, 51 software copyrights, 1 artwork copyright in the registration application process,
39 registered trademarks, 5 trademark applications and 27 domain names in the PRC and 3 registered trademarks outside of the PRC.

We cannot assure
you that any patents or copyrights will be issued from any of our pending applications. In addition, any rights granted under
any of our existing or future patents, copyrights or trademarks may not provide meaningful protection or any commercial advantage
to us. With respect to our other proprietary rights, it may be possible for third parties to copy or otherwise obtain and use
proprietary technology without authorization or to develop similar technology independently. We may in the future initiate claims
or litigation against third parties to determine the validity and scope of proprietary rights of others. In addition, we may in
the future initiate litigation to enforce our intellectual property rights or to protect our trade secrets. Additional information
about the risks relating to our intellectual property is provided under “Risk Factors—Risks Related to Intellectual
Property.”

Competition

We face significant
competition in our evolving market from numerous competitors, particularly cloud-based customer engagement SaaS providers in China.
We believe that the SaaS customer engagement industry in China is still at the beginning of the growth phase in the industry lifecycle,
where the market is segmented and no large players have yet dominated the market. To differentiate us from other SaaS providers
in the industry, we provide more intelligent and customized solutions with an industry focus on finance. We embed our SaaS with
AI and machine learning capabilities, and our no-code development platform allows easy customization and significantly decreases
our time to market.

Participants in the
cloud-based customer engagement service industry include call center providers, software developers focusing on customer engagement,
traditional technology companies providing customized development, implementation and support services, and several other categories
of competitors. Many of our competitors developed cloud-based software similar to us. We may also face competition from new and
emerging companies.

Compared to our company,
our current and potential competitors may have:

· better
established credibility and market reputations, and broader service and product offerings;
· greater
financial, technical, marketing and other resources, which may allow them to pursue enhanced
design, development, sales, marketing, distribution and support for their services and
products; and
· more
extensive customer and partner relationships, which may position them to identify and
respond more successfully to market developments and changes in customer demands.

However, we believe
we are well positioned to compete in this developing market as a result of our comprehensive service and product portfolio, research
and development capabilities, diverse sales and marketing network and experienced management team. We also focus on the customer
engagement SaaS in the finance industry where there are high thresholds of existing entry barriers due to strict compliance and
security requirements and capabilities to handle large volumes of services with stability.

The principal competitive factors in our
market include:

· intelligent
and comprehensive service and product portfolio that meets the demand of both small and
medium sized businesses and large enterprises;
· efficient
customization of services and products;
· in-depth
industry expertise, in particular in the finance industry;
· brand
recognition and reputation;
· efficacy,
reliability and ease of use of services and products;
· ability
to build customer loyalty, retain existing customers and attract new customers;
· strength
of sales and marketing efforts; and
· advancement
of innovation and research and development of services and products.

We believe we compete favorably with respect
to the factors mentioned above.

Facilities

Our principal executive
office is located at Room 12A05, Block A, Boya International Center, Building 2, No. 1 Courtyard, Lize Zhongyi Road, Chaoyang
District, Beijing, China 100102, where we lease two units, Room 12A05 and 12A06, consisting of approximately 656 and 210 square
meters of office space, respectively. We lease these spaces under two leases that will both terminate on March 31, 2022. We also
lease units under four leases located at 25th Floor, Building 9, Zone C, Huaguoyuan Project, No. 1, Huaguoyuan Street, Nanming
District, Guiyang City, China, 550002 ranging from approximately 115 to 612 square meters of office space under leases that will
terminate on October 7, October 8 and October 10, 2021.

We also lease other
spaces that we do not view to be material to our business. We believe that our facilities are adequate to meet our needs for the
immediate future, and that, should it be needed, suitable additional space will be available on commercially reasonable terms
to accommodate any expansion of our operations.

We are also in the
process of constructing a cloud computing facility in Guiyang, China. The facility is expected to have two buildings consisting
of approximately 43,000 square meters in total which is expected to house our cloud and BPO services operations as well as offices,
research centers, logistics and employee dormitories. This facility is intended to replace our current facilities in Guiyang and
some of our facilities in Beijing and Hefei, China, which are currently leased. We have completed demolition, underground structure
and design. We are currently awaiting approval from the relevant governmental authorities to begin construction, and we expect
the costs to complete the facility will be approximately $10 million. We are currently awaiting approval from the relevant governmental
authorities and expect to begin construction within three months following such approval, and the project is estimated to be completed
in late 2022.

Employees

As of December 31,
2020, we had 305 employees, all of whom were full-time employees and were located in China. None of our employees are represented
by a labor union or covered by a collective bargaining agreement. We have never experienced any employment related work stoppages,
and we consider our relations with our employees to be good.

COVID-19 Update

In December 2019,
a novel strain of coronavirus, or COVID-19, surfaced and spread rapidly over the globe, including China and the United States.
The epidemic has resulted in quarantines, travel restrictions, and the temporary closure of stores and facilities in China and
elsewhere. Substantially all of our revenue is concentrated in China. Consequently, the COVID-19 pandemic has materially and adversely
affected our business operations, financial condition and operating results for first half of 2020 and may adversely affect the
result of operations for the second half of 2020 and/or the full year 2020. Current and potential impacts include, but are not
limited to, the following:

·
We temporarily closed our offices and implemented a work-from-home policy beginning in February 2020, as required by relevant
PRC regulatory authorities. We reopened our offices in April 2020;

·
Due to the nature of our business, the impact of the closures
on our operational capabilities was insignificant, as most of our work force continued working offsite during such office closures;

·
Our customers could potentially be negatively impacted by COVID-19, which may reduce their budgets for customer services
in 2021 and beyond. We experienced a decrease in revenue in the first half of 2020, and although revenue was back to our expected
level in June 2020, our overall revenue, gross profit and net income may be negatively impacted in 2020; and

·
The situation may worsen if the COVID-19 pandemic continues.
We have not yet experienced significant late payments from our customers, but we may if the situation worsens. We will continue
to closely monitor our payment collections throughout 2021 and beyond.

For a detailed description
of the risks associated with COVID-19, see “Risk Factors – Risks Related to Doing Business in China – We face
risks related to natural disasters, health epidemics and other outbreaks, specifically the coronavirus, which could significantly
disrupt our operations.”

Legal Proceedings

On July 20, 2012,
Infobird Anhui signed a leasing agreement with Hefei Shushan Economic Development District Management Committee, or Hefei Shushan,
to lease certain properties in the industry park managed by Hefei Shushan. A supplemental agreement was subsequently signed on
August 6, 2012 which amended the term of the lease and provided certain incentives and subsidies to Infobird Anhui. In June 2019,
Hefei Shushan filed a lawsuit in Shushan District People’s Court against Infobird Anhui claiming the incentives and subsidy
provided to Infobird Anhui was indeed a loan and Infobird Anhui was in default of loan contract of approximately $0.9 million
(RMB 6,400,000). On August 1, 2019, Shushan District People’s Court issued a civil judgment against Hefei Shushan. Hefei
Shushan subsequently filed an appeal in Anhui Province Hefei City Intermediary People’s Court. The Court ruled against Hefei
Shushan on December 3, 2019. The case was concluded and no contingent loss was recorded on our consolidated financial statements.

Other than the above
mentioned concluded legal proceeding, we are not a party to any legal proceedings that in the opinion of our management would
have a material adverse effect on our business. However, from time to time we may become involved in legal proceedings or may
be subject to claims arising in the ordinary course of our business. Although the results of litigation and claims cannot be predicted
with certainty, we believe that the final outcome of ordinary course matters will not have a material adverse effect on our business,
operating results, financial condition or cash flows.

REGULATION

The following sets
forth a summary of the most significant rules and regulations that affect our business activities in China.

Regulations on Value-added Telecommunications
Services

The Telecommunications
Regulations of the PRC, or the Telecom Regulations, implemented on September 25, 2000 and amended on July 29, 2014 and February
6, 2016, are the primary PRC law governing telecommunications services and set out the general framework for the provision of
both “basic telecommunication services” and “value-added telecommunication services” by domestic PRC companies.
“Value-added telecommunication services” is defined as telecommunications and information services provided through
public networks, and, according to the Telecom Regulations, operators of value-added telecommunications services shall obtain
operating licenses prior to commencing operations from the MIIT, or its provincial level counterparts. Enterprises operating telecommunication
business in absence of operating license shall be ordered by the MIIT, or its provincial level counterparts, to rectify the violations,
the illegal income shall be confiscated, and a penalty between three times and five times of the illegal income shall be imposed.
If there is no illegal income or the illegal income is lower than RMB 50,000 (approximately $7,100), a penalty between RMB 100,000
(approximately $14,200) and RMB 1,000,000 (approximately $142,000) shall be imposed. In a serious case, the business shall be
suspended.

The Catalogue of
Telecommunications Business, or the Catalogue, which was issued as an attachment to the Telecom Regulations and recently revised
and promulgated on June 6, 2019, further identifies information services and online data processing and transaction processing
services as value-added telecommunications services. Pursuant to the Catalogue, the call center business refers to the provision
of business consultation, information consultation and data query services to users, with the entrustment of enterprises or institutions,
based on the call center system and database technology connected to public communication network or the internet and the information
database established by information collection, processing and storage. We engage in business activities that are value-added
telecommunications services as defined and described by the Telecom Regulations and the Catalogue.

On March 5, 2009,
the MIIT issued the Measures on the Administration of Telecommunications Business Operating Permits, or the Telecom License Measures,
which initially became effective on April 10, 2009 and was amended on July 3, 2017, effective on September 1, 2017, to supplement
the Telecom Regulations. The Telecom License Measures provide that there are two types of telecommunications operating licenses,
or the VAT Licenses for operators in China, one for basic telecommunications services and one for value-added telecommunications
services. A distinction is also made to licenses for value-added telecommunications services as to whether a license is granted
for “intra-provincial” or “trans-regional” (inter-provincial) activities. An appendix to each license
granted will detail the permitted activities of the enterprise to which it was granted. An approved telecommunications services
operator must conduct its business (whether basic or value-added) in accordance with the specifications recorded in its VAT License.

Regulations on Foreign Direct Investment
in Value-Added Telecommunications Companies

Foreign direct investment
in telecommunications companies in China is governed by the Provisions on the Administration of Foreign-Invested Telecommunications
Enterprises, or the FITE Regulations, which were issued by the State Council on December 11, 2001, became effective on January
1, 2002 and recently amended and issued on February 6, 2016, and the Industry Guidelines on Encouraged Foreign Investment (Year
2020), or the 2020 Encouraged Guidelines, which were promulgated by the NDRC and the MOFCOM on December 27, 2020 and became effective
on January 27, 2021, and the 2020 Negative List, which were issued by NDRC, and the MOFCOM, on June 23, 2020, replacing the Catalogue
of Industries for Guiding Foreign Investment (Year 2017), or the Foreign Investment Catalogue, which was revised and promulgated
by the NDRC and the MOFCOM on June 28, 2017. Under the aforesaid regulations, foreign invested telecommunications enterprises
in the PRC, or FITEs, are generally required to be established as Sino-foreign equity joint ventures with limited exceptions.
In general, the foreign party to a FITE engaging in value-added telecommunications services may hold up to 50% of the equity of
the FITE, of which the geographical area it may conduct telecommunications services is provided by the MIIT in accordance with
relevant provisions as mentioned above. In addition, the major foreign investor in a value-added telecommunications business in
China must satisfy a number of stringent performance and operational experience requirements, including demonstrating a good track
record and experience in operating a value-added telecommunications business overseas.

On June 30, 2016,
the MIIT issued an Announcement of the Ministry of Industry and Information Technology on Issues concerning the Provision of Telecommunication
Services in Mainland China by Service Providers from Hong Kong and Macau, or the MIIT Announcement, which provides that investors
from Hong Kong and Macau may hold no more than 50% of the equity in FITEs engaging in certain specified categories of value-added
telecommunications services.

On July 13, 2006,
the MIIT issued the Notice of the Ministry of Information Industry on Intensifying the Administration of Foreign Investment in
Value-added Telecommunications Services, or the MIIT Notice, which reiterates certain provisions of the FITE Regulations. In addition
to the provisions stated in FITE Regulations, the MIIT Notice further provide that a domestic company that holds a value-added
telecommunications license, is prohibited from leasing, transferring or selling the value-added telecommunications license to
foreign investors in any form, and from providing any assistance, including providing resources, sites or facilities, to foreign
investors to conduct value-added telecommunications businesses illegally in China. The MIIT Notice also requires each value-added
telecommunications license holder to have appropriate facilities for its approved business operations and to maintain such facilities
in the regions covered by its license, and specifically, with regard to the domain names and trademarks, the MIIT Notice required
that trademarks and domain names that are used in the provision of Internet content services must be owned by the VAT License
holder or its shareholders.

Regulations on Internet Information
Services

The Administrative
Measures on Internet Information Services, or the Internet Information Measures, which was issued by the State Council on September
25, 2000 and amended on January 8, 2011, set out guidelines on the provision of internet information services. Pursuant to the
Internet Information Measures, « internet information services » are defined as services that provide information to online
users through the internet. The Internet Information Measures classifies internet information services into commercial internet
information services and non-commercial Internet information services. The commercial internet information services refer to services
that provide information or services to internet users with charge. The Internet Information Measures requires commercial internet
information services operators to obtain a value-added telecommunications business operating license, or the ICP License, from
the relevant government authorities before engaging in any commercial internet information services operations in China.

In addition, internet
information service providers are required to monitor their websites to ensure that they do not contain content prohibited by
laws or regulations. Internet information service providers are prohibited from producing, copying, publishing or distributing
information that is humiliating or defamatory to others or that infringes the legal rights of others. The PRC government may require
corrective actions to address non-compliance by ICP License holders or revoke their ICP License for serious violations. Furthermore,
the MIIT Circular on Regulating the Use of Domain Names in Internet Information Services, issued on November 27, 2017 and that
took effect on January 1, 2018, requires internet information service providers to register and own the domain names they use
in providing internet information services.

Regulations on Mobile Internet Application
Information Services

The Cyberspace Administration
of China, or CAC, issued the Administrative Provisions on Mobile Internet Application Information Services on June 28, 2016, which
took effect on August 1, 2016, requiring internet information service providers, or ICPs, who provide information services through
mobile internet applications, or APPs, i.e. mobile application providers, to authenticate the identity of the registered users,
establish procedures for protection of user information, establish procedures for information content censorship and management,
ensure that users are given adequate information concerning an APP and are able to choose whether an APP is installed and whether
or not to use an installed APP and its functions, protect intellectual property rights concerned and keep records of users’ logs
for sixty (60) days. Mobile application providers and application store service providers are prohibited from engaging in any
activity that may endanger national security, disturb the social order, or infringe the legal rights of third parties, and may
not produce, copy, issue or disseminate through mobile applications any content prohibited by laws and regulations. If an ICP
violates these regulations, mobile app stores through which the ICP distributes its APPs may issue warnings, suspend the release
of its APPs, or terminate the sale of its APPs, and/or report the violations to governmental authorities.

ICPs are also required
under the Interim Measures on the Administration of Pre-Installation and Distribution of Applications for Mobile Smart Terminals,
which was issued on December 16, 2016 and took effect on July 1, 2017, to ensure that APPs, as well as its ancillary resource
files, configuration files and user data, can be conveniently uninstalled by a user, unless it is a basic function software (i.e.,
software that supports the normal functioning of hardware and operating system of a mobile smart device).

Regulations Relating to Information
Security and Privacy Protection

Regulations on Information Security

In recent years,
PRC government authorities have enacted laws and regulations with respect to internet information security and protection of personal
information from abusing or unauthorized disclosure. Pursuant to the Decision on the Maintenance of Internet Security issued by
the NPC Standing Committee on December 28, 2000, which was amended on August 27, 2009, persons may be subject to criminal liabilities
in China for any attempt to: (i) gain improper entry into a computer or system of strategic importance; (ii) disseminate
politically disruptive information; (iii) leak state secrets; (iv) spread false commercial information; (v) infringe
upon intellectual property rights or damage business credit or reputation of others; (vi) intentionally make, spread computer
viruses and other destructive programs, attack computer systems and communication networks which lead to damages to such systems
and networks; (vii) carry out theft, fraud, racketeering through internet; and (viii) other activities prohibited by relevant
laws and regulations.

The Administration
Measures on the Security Protection of Computer Information Network with International Connections, issued by the Ministry of
Public Security of the PRC, or MPS, on December 16, 1997 and amended by the State Council on January 8, 2011, prohibits using
the internet in ways that result in a leak of state secrets or a spread of socially destabilizing content. The MPS has supervision
and inspection powers and relevant local security bureaus may also have jurisdiction. If a value-added-telecommunications service
license holder violates these measures, the government of the PRC may revoke its value-added-telecommunications service license
and shut down its websites.

On November 7, 2016,
the NPC Standing Committee promulgated the Cyber Security Law of the PRC, or the PRC Cyber Security Law, which took effect on
June 1, 2017, pursuant to which, network operators must comply with laws and regulations and fulfil their obligations to safeguard
security of the network when conducting business and providing services. Those who provide services through networks must take
technical measures and other necessary measures pursuant to laws, regulations and compulsory national requirements to safeguard
the safe and stable operation of the networks, respond to network security incidents effectively, prevent illegal and criminal
activities, and maintain the integrity, confidentiality and usability of network data. It also states that network operator may
not collect personal information that is irrelevant to the services it provides or collect or use the personal information in
violation of the provisions of laws or agreements between both parties. Under the Cyber Security Law, network operators are subject
to various security protection-related obligations, including:

· complying
with security protection obligations in accordance with tiered requirements with respect
to maintenance of the security of Internet systems, which include formulating internal
security management rules and developing manuals, appointing personnel who will be responsible
for internet security, adopting technical measures to prevent computer viruses and activities
that threaten Internet security, adopting technical measures to monitor and record status
of network operations, holding Internet security training events, retaining user logs
for at least six (6) months, and adopting measures such as data classification, key data
backup, and encryption for the purpose of securing networks from interference, vandalism,
or unauthorized visits, and preventing network data from leakage, theft, or tampering;

· verifying
users’ identities before signing agreements or providing services such as network
access, domain name registration, landline telephone or mobile phone access, information
publishing, or real-time communication services;

· clearly
indicating the purposes, methods and scope of the information collection, the use of
information collection, and obtain the consent of those from whom the information is
collected when collecting or using personal information;

· strictly
preserving the privacy of user information they collect, and establish and maintain systems
to protect user privacy; and

· strengthening
management of information published by users. When the network operators discover information
prohibited by laws and regulations from publication or dissemination, they shall immediately
stop dissemination of that information, including taking measures such as deleting the
information, preventing the information from spreading, saving relevant records, and
reporting to the relevant governmental agencies.

On May 2, 2017, the
CAC issued the Measures for the Security Review of Network Products and Services (Trial), or the Cyber Security Review Measures,
which took effect on June 1, 2017, to provide for more detailed rules regarding cyber security review requirements. Under the
Cyber Security Review Measures, the following cyber products and services shall be subject to cybersecurity review:

· important
cyber products and services purchased by networks, and information systems related to
national security; and

· the
purchase of cyber products and services by operators of critical information infrastructure
in key industries and fields, such as public communications and information services,
energy, transportation, water resources, finance, public service, and electronic administration,
and other critical information infrastructure, that may affect national security.

The CAC is responsible
for organizing and implementing cybersecurity reviews, while the competent departments in key industries such as finance, telecommunications,
energy, and transport are responsible for organizing and implementing security review of cyber products and services in their
respective industries and fields.

On November 15, 2018,
the CAC issued the Provisions on Security Assessment of the Internet Information Services with Public Opinion Attributes or Social
Mobilization Capacity, which came into effect on November 30, 2018. The provisions require Internet information providers to conduct
security assessments on their Internet information services if their services include forums, blogs, microblogs, chat rooms, communication
groups, public accounts, short-form videos, online live-streaming, information sharing, mini programs or other functions that
provide channels for the public to express opinions or have the capability of mobilizing the public to engage in specific activities.
Internet information providers must conduct self-assessment on, among other things, the legality of new technology involved in
the services and the effectiveness of security risk prevention measures, and file the assessment report with the local competent
cyberspace administration authority and public security authority.

The Regulations on
Cyber Security Supervision and Inspection of Public Security Organs, which was issued by the MPS on September 15, 2018 and came
into effect on November 1, 2018, is an important basis for the Public Security Bureau to strengthen the enforcement of the Cyber
Security Law.

Internet security
in China is also regulated and restricted from a national security standpoint. On July 1, 2015, the SCNPC promulgated the new
National Security Law, which took effect on the same date and replaced the former National Security Law promulgated in 1993. According
to the new National Security Law, the state shall ensure that the information system and data in important areas are secure and
controllable. In addition, according to the new National Security Law, the state shall establish national security review and
supervision institutions and mechanisms, and conduct national security reviews of key technologies and IT products and services
that affect or may affect national security. There are uncertainties on how the new National Security Law will be implemented
in practice.

Pursuant to the Ninth
Amendment to the Criminal Law issued by the NPC Standing Committee on August 29, 2015, which took effect on November 1, 2015,
any Internet service provider that fails to fulfil the obligations related to internet information security administration as
required by applicable laws and refuses rectification orders is subject to criminal liability for (i) any dissemination of illegal
information in large scale, (ii) any severe effect due to leakage of the client’s information, (iii) any serious loss of criminal
evidence, or (iv) other severe situation. These amendments also state that any individual or entity that (i) sells or provides
personal information to others that violates applicable law, or (ii) steals or illegally obtains any personal information, is
subject to criminal penalty for severe violations.

On May 8, 2017, the
Supreme People’s Court and the Supreme People’s Procuratorate released the Interpretations of the Supreme People’s Court and the
Supreme People’s Procuratorate on Several Issues Concerning the Application of Law in the Handling of Criminal Cases Involving
Infringement of Citizens’ Personal Information, which took effect on June 1, 2017. It clarifies several concepts regarding the
crime of « infringement of citizens’ personal information, » including « citizen’s personal information, » « provision, »
and « unlawful acquisition. »

In addition, the
Civil Code of the PRC, which was issued by the NPC on May 28, 2020 and took effect on January 1, 2021, requires personal information
of individuals to be protected. Any organization or individual requiring personal information of others shall obtain such information
legally and ensure the security of such information, and shall not illegally collect, use, process, or transmit such personal
information, or illegally buy, sell, provide, or publish such personal information.

Pursuant to the Announcement
of Conducting Special Supervision against the Illegal Collection and Use of Personal Information by APP, which was issued on January
23, 2019, APP operators should collect and use personal information in compliance with the Cyber Security Law and should be responsible
for the security of personal information obtained from users and take effective measures to strengthen the personal information
protection. Furthermore, APP operators should not force their users to make authorization by means of bundling, suspending installation
or in other default forms and should not collect personal information in violation of laws, regulations or breach of user agreements.
Such regulatory requirements were emphasized by the Notice on the Special Rectification of APPs Infringing upon User’s Personal
Rights and Interests, which was issued by MIIT on October 31, 2019.

On October 21, 2019,
the Supreme People’s Court and the Supreme People’s Procuratorate jointly issued the Interpretations on Certain Issues Regarding
the Applicable of Law in the Handling of Criminal Case Involving Illegal Use of Information Networks and Assisting Committing
Internet Crimes, which came into effect on November 1, 2019, and further clarifies the meaning of Internet service provider and
the severe situations of the relevant crimes.

Regulations on Privacy Protection

On December 13, 2005,
the MPS issued the Regulations on Technological Measures for Internet Security Protection, or the Internet Protection Measures,
which took effect on March 1, 2006, requiring internet service providers to utilize standard technical measures for internet security
protection. and to keep records of certain information about their users (including user registration information, log-in and
log-out time, IP address, content and time of posts by users) for at least sixty (60) days and submit the above information as
required by laws and regulations.

Under the Several
Provisions on Regulating the Market Order of Internet Information Services issued by the MIIT on December 29, 2011 and that took
effect on March 15, 2012, ICPs are also prohibited from collecting any personal user information or providing any information
to third parties without the consent of the user. The Cyber Security Law provides an exception to the consent requirement where
the information is anonymous, not personally identifiable and unrecoverable. ICPs must expressly inform the users of the method,
content and purpose of the collection and processing of user personal information and may only collect information necessary for
its services. ICPs are also required to properly maintain user personal information, and in case of any leak or likely leak of
user personal information, ICPs must take remedial measures immediately and report any material leak to the telecommunications
regulatory authority.

In addition, the
Decision on Strengthening Network Information Protection issued by the NPC Standing Committee on December 28, 2012 emphasizes
the need to protect electronic information that contains individual identification information and other private data. The decision
requires ICPs to expressly inform their users of the internet service providers’ collection and use of user personal information,
establish and publish policies regarding the purpose, manner and scope of Internet service providers’ collection and use
of personal electronic information standards, collect and use user personal information only with the consent of the users and
only within the scope of such consent and to take necessary measures to ensure the security of the information and to prevent
leakage, damage or loss. The decision also mandates that Internet services providers and their employees must keep strictly confidential
user personal information that they collect.

Furthermore, MIIT’s
Order on Protection of Personal Information of Telecommunications and Internet Users, or the Order, which was issued on July 16,
2013 and took effect on September 1, 2013, contains detailed requirements on the use and collection of personal information as
well as the security measures to be taken by ICPs. Most of the requirements under the Order that are relevant to Internet services
providers are consistent with the requirements already established under the MIIT provisions discussed above, except that under
the Order the requirements are more strict and have a wider scope. If an Internet services provider wishes to collect or use personal
information, it may do so only if such collection is necessary for the services it provides. Further, it must disclose to its
users the purpose, method and scope of any such collection or use, and must obtain consent from the users whose information is
being collected or used. Internet services providers are also required to establish and publish their protocols relating to personal
information collection or use, keep any collected information strictly confidential, and take technological and other measures
to maintain the security of such information. Internet services providers are also required to cease any collection or use of
the user personal information, and de-register the relevant user account, when a given user stops using the relevant Internet
service. Internet services providers are further prohibited from divulging, distorting or destroying any such personal information,
or selling or providing such information unlawfully to other parties. The Order states, in broad terms, that violators may face
warnings, fines, and disclosure to the public and, in the most severe cases, criminal liability.

On January 5, 2015,
the SAIC promulgated the Measures on Punishment for Infringement of Consumer Rights, which was revised on October 23, 2020, pursuant
to which business operators collecting and using personal information of consumers must comply with the principles of legitimacy,
propriety and necessity, specify the purpose, method and scope of collection and use of the information, and obtain the consent
of the consumers whose personal information is to be collected. Business operators may not (i) collect or use personal information
of consumers without their consent, (ii) unlawfully divulge, sell or provide personal information of consumers to others or (iii)
send commercial information to consumers without their consent or request, or when a consumer has explicitly declined to receive
such information.

On August 22, 2019,
the Cyberspace Administration of China promulgated the Provisions on the Cyber Protection of Children’s Personal Information,
which took effect on October 1, 2019, requiring that before collecting, using, transferring or disclosing the personal information
of a child, any Internet service operator should inform that child’s guardians in a noticeable and clear manner and obtain their
consents. Meanwhile, Internet service operators should take measures like encryption when storing children’s personal information.

Regulations Relating to Product Liability

Manufacturers and
vendors of defective products in the PRC may incur liability for losses and injuries caused by such products. Under the Civil
Code of the PRC, which was promulgated on May 28, 2020 and became effective on January 1, 2021, manufacturers or retailers of
defective products that cause property damage or physical injury to any person will be subject to civil liability.

The Product Quality
Law of the PRC (as amended in 2000, 2009 and 2018) and the Law of the PRC on the Protection of the Rights and Interests of Consumers
(as amended in 2009 and 2013), which were enacted to protect the legitimate rights and interests of end-users and consumers and
to strengthen the supervision and control of the quality of products. If our products are defective and cause any personal injuries
or damage to assets, our customers have the right to claim compensation from us.

Regulations on Intellectual Property in the PRC

Copyright

Pursuant to the Copyright
Law of the PRC, which was first promulgated by the Standing Committee of the National People’s Congress on September 7,
1990 and became effective from June 1, 1991, and was last amended on February 26, 2010 and became effective as of April 1, 2010,
copyrights include personal rights such as the right of publication and that of attribution as well as property rights such as
the right of production and that of distribution. Reproducing, distributing, performing, projecting, broadcasting or compiling
a work or communicating the same to the public via an information network without permission from the owner of the copyright therein,
unless otherwise provided in the Copyright Law of the PRC, constitute infringements of copyrights. The amended Copyright Law extends
copyright protection to Internet activities, products disseminated over the internet and software products. In addition, there
is a voluntary registration system administered by the China Copyright Protection Center.

In order to further
implement the Computer Software Protection Regulations, promulgated by the State Council on June 4, 1991 and amended on January
30, 2013, the National Copyright Administration, or the NCA, issued the Computer Software Copyright Registration Procedures on
April 6, 1992 and amended on February 20, 2002, which specify detailed procedures and requirements with respect to the registration
of software copyrights. The China Copyright Protection Center shall grant registration certificates to the computer software copyrights
applicants which meet the requirements of both the software copyright registration procedures and the computer software protection
regulations.

Trademark

Pursuant to the Trademark
Law of the PRC, or the Trademark Law, which was first promulgated by the Standing Committee of the National People’s Congress
on August 23, 1982 and became effective from March 1, 1983, and was most recently amended on April 23, 2019 and became effective
on November 1, 2019, the right to exclusive use of a registered trademark shall be limited to trademarks which have been approved
for registration and to goods and/or services for which the use of such trademark has been approved. The period of validity of
a registered trademark shall be ten years, counted from the day the registration is approved, and may be renewed for another ten
years provided relevant application procedures have been completed within twelve (12) months before the end of the validity period.
According to this law, using a trademark that is identical to or similar to a registered trademark in connection with the same
or similar goods and/or services without the authorization of the owner of the registered trademark constitutes an infringement
of the exclusive right to use a registered trademark.

The Implementation
Regulation for the Trademark Law promulgated by the State Council came into effect on September 15, 2002 and was further amended
on April 29, 2014. Under the Trademark Law and the implementing regulation, the Trademark Office of the State Administration for
Market Regulation, or the Trademark Office, is responsible for the registration and administration of trademarks. The Trademark
Office handles trademark registrations. As with patents, China has adopted a “first-to-file” principle for trademark
registration. If two or more applicants apply for registration of identical or similar trademarks for the same or similar commodities,
the application that was filed first will receive preliminary approval and will be publicly announced. A registrant may apply
to renew a registration within twelve (12) months before the expiration date of the registration. If the registrant fails to apply
in a timely manner, a grace period of six (6) additional months may be granted. If the registrant fails to apply before the grace
period expires, the registered trademark shall be deregistered. Renewed registrations are valid for ten years.

In addition to the
above, a Trademark Review and Adjudication Board was established for resolving trademark disputes. According to the Trademark
Law, within three (3) months since the date of the announcement of a preliminarily validated trademark, if a titleholder is of
the view that such trademark in application is identical or similar to its registered trademark for the same type of commodities
or similar commodities which violates relevant provisions of the Trademark Law, such titleholder may raise an objection to the
Trademark Office within the aforesaid period. In such event, the Trademark Office shall consider the facts and grounds submitted
by both the dissenting party and the party being challenged and shall decide on whether the registration is allowed within twelve
(12) months upon the expiration of the announcement after investigation and verification, and notify the dissenting party and
the person challenged in writing.

Patent

Pursuant
to the Patent Law of the PRC, which was promulgated by the Standing Committee of the National People’s Congress on March
12, 1984 and became effective from April 1, 1985, and was most recently amended on December 27, 2008, and was most recently amended
on December 27, 2008 and became effective on October 1, 2009
, patents in China are classified
into three categories, namely, inventions, utility models and designs. The protection period of a patent right is 10 years for
utility models and designs, and 20 years for inventions from the date of application. A patentable invention, utility model or
design must meet three conditions: novelty, inventiveness and practical applicability. Patents cannot be granted for scientific
discoveries, rules and methods for intellectual activities, methods used to diagnose or treat diseases, animal and plant breeds
or substances obtained by means of nuclear transformation. The Patent Office under the State Intellectual Property Office is responsible
for receiving, examining and approving patent applications. A patent is valid for a twenty-year term for an invention and a ten-year
term for a utility model or design, starting from the application date. After the grant of the patent right for an invention or
utility model, except where otherwise provided for in the Patent Law, no entity or individual may, without the authorization of
the patent owner, exploit the patent, that is, make, use, offer to sell, sell or import the patented product, or use the patented
process, or use, offer to sell, sell or import any product which is a direct result of the use of the patented process, for production
or business purposes. And after a patent right is granted for a design, no entity or individual shall, without the permission
of the patent owner, exploit the patent, that is, for production or business purposes, manufacture, offer to sell, sell, or import
any product containing the patented design.

Domain Name

Pursuant to the Administrative
Measures on Internet Domain Names of China, which was recently amended by the MIIT on August 24, 2017 and became effective on
November 1, 2017, « domain name » shall refer to the character mark of hierarchical structure, which identifies and locates
a computer on the internet and corresponds to the internet protocol (IP) address of that computer. The principle of « first
come, first serve » is followed for the domain name registration service. Applicants for registration of domain names shall
provide the true, accurate and complete information of their identifications to domain name registration service institutions.
After completing the domain name registration, the applicant becomes the holder of the domain name registered by him/it. Furthermore,
the holder shall pay operation fees for registered domain names on schedule. If the domain name holder fails to pay the corresponding
fees as required, the original domain name registrar shall write it off and notify the holder of the domain name in written form.

Laws and Regulations on Labor
Protection in the PRC

According to the
Labor Law of the PRC, or the Labor Law, which was promulgated by the Standing Committee of the NPC on July 5, 1994, came into
effect on January 1, 1995, and was most recently amended on December 29, 2018, an employer shall develop and improve its rules
and regulations to safeguard the rights of its workers. An employer shall develop and improve its labor safety and health system,
stringently implement national protocols and standards on labor safety and health, conduct labor safety and health education for
workers, guard against labor accidents and reduce occupational hazards. Labor safety and health facilities must comply with relevant
national standards. An employer must provide workers with the necessary labor protection gear that complies with labor safety
and health conditions stipulated under national regulations, as well as provide regular health checks for workers that are engaged
in operations with occupational hazards. Laborers engaged in special operations shall have received specialized training and have
obtained the pertinent qualifications. An employer shall develop a vocational training system. Vocational training funds shall
be set aside and used in accordance with national regulations and vocational training for workers shall be carried out systematically
based on the actual conditions of the company.

The Labor Contract
Law of the PRC, which was promulgated by the SCNPC on June 29, 2007, came into effect on January 1, 2008, and was amended on December
28, 2012 and became effective as of July 1, 2013, and the Implementation Regulations on Labor Contract Law, which was promulgated
on September 18, 2008, and became effective since the same day, regulate both parties through a labor contract, namely the employer
and the employee, and contain specific provisions involving the terms of the labor contract. It is stipulated under the Labor
Contract Law and the Implementation Regulations on Labor Contract Law that a labor contract must be made in writing. if labor
relationships are to be or have been established between employers and the employees An employer and an employee may enter into
a fixed-term labor contract, an un-fixed term labor contract, or a labor contract that concludes upon the completion of certain
work assignments, after reaching agreement upon due negotiations. An employer may legally terminate a labor contract and dismiss
its employees after reaching agreement upon due negotiations with the employee or by fulfilling the statutory conditions. Labor
contracts concluded prior to the enactment of the Labor Law and subsisting within the validity period thereof shall continue to
be honored. With respect to a circumstance where a labor relationship has already been established but no formal written contract
has been made, a written labor contract shall be entered into within one (1) month from the commencement date of the employment.
Employers are prohibited from forcing employees to work above certain time limit and employers shall pay employees for overtime
work in accordance to national regulations. In addition, employee wages shall be no lower than local standards on minimum wages
and shall be paid to employees timely.

According to the
Interim Regulations on the Collection and Payment of Social Insurance Premiums, the Regulations on Work Injury Insurance, the
Regulations on Unemployment Insurance and the Trial Measures on Employee Maternity Insurance of Enterprises, enterprises in the
PRC shall provide benefit plans for their employees, which include basic pension insurance, unemployment insurance, maternity
insurance, work injury insurance and basic medical insurance. An enterprise must provide social insurance by processing social
insurance registration with local social insurance agencies, and shall pay or withhold relevant social insurance premiums for
or on behalf of employees. The Law on Social Insurance of the PRC, which was promulgated by the Standing Committee of the National
People’s Congress on October 28, 2010, and became effective on July 1, 2011, and was most recently updated on December 29,
2018, has consolidated pertinent provisions for basic pension insurance, unemployment insurance, maternity insurance, work injury
insurance and basic medical insurance, and has elaborated in detail the legal obligations and liabilities of employers who do
not comply with relevant laws and regulations on social insurance. Where an employer fails to fully pay social insurance premiums,
relevant social insurance collection agency shall order it to make up for any shortfall within a prescribed time limit, and may
impose a late payment fee at the rate of 0.05% per day of the outstanding amount from the due date. If such employer still fails
to make up for the shortfalls within the prescribed time limit, the relevant administrative authorities shall impose a fine of
one to three times the outstanding amount upon such employer.

According to the
Interim Measures for Participation in the Social Insurance System by Foreigners Working within the Territory of China, which was
promulgated by the Ministry of Human Resources and Social Security of the PRC on September 6, 2011, and became effective on October
15, 2011, or the Interim Measures for Foreigners, employers who employ foreigners shall participate in the basic pension insurance,
unemployment insurance, basic medical insurance, occupational injury insurance, and maternity insurance in accordance with the
relevant law, with the social insurance premiums to be contributed respectively by the employers and foreigner employees as required.
In accordance with Interim Measures for Foreigners, the social insurance administrative agencies shall exercise their right to
supervise and examine the legal compliance of foreign employees and employers and the employers who do not pay social insurance
premiums in conformity with the laws shall be subject to the administrative provisions provided in the Social Insurance Law and
the relevant regulations and rules mentioned above.

According to the
Regulations on the Administration of Housing Provident Fund, which was promulgated by the State Counsel and became effective on
April 3, 1999, and was amended on March 24, 2002 and was partially revised on March 24, 2019 by Decision of the State Council
on Revising Some Administrative Regulations (Decree No. 710 of the State Council), housing provident fund contributions by an
individual employee and housing provident fund contributions by his or her employer shall belong to the individual employee. Registration
by PRC companies at the applicable housing provident fund management center is compulsory and a special housing provident fund
account for each of the employees shall be opened at an entrusted bank.

The employer shall
timely pay up and deposit housing provident fund contributions in full amount and late or insufficient payments shall be prohibited.
Under the circumstances where financial difficulties do exist due to which an employer is unable to pay or pay up house provident
funds, permission of labor union of the employer and approval of the local house provident funds commission must first be obtained
before the employer can suspend or reduce their payment of house provident funds. The employer shall process housing provident
fund payment and deposit registrations with the housing provident fund administration center. The minimum standard for housing
provident funds is 5% of employees’ average monthly salary of the preceding year, and such percentage rate may be uplifted
by the local housing provident funds management commissions if examined by the people’s government of same level and approved
by people’s government of provincial, or autonomous region or municipality level. With respect to companies who violate
the above regulations and fail to process housing provident fund payment and deposit registrations or open housing provident fund
accounts for their employees, such companies shall be ordered by the housing provident fund administration center to complete
such procedures within a designated period. Those who fail to process their registrations within the designated period shall be
subject to a fine ranging from RMB 10,000 (approximately $1,400) to RMB 50,000 (approximately $7,100). When companies breach these
regulations and fail to pay up housing provident fund contributions in full amount as due, the housing provident fund administration
center shall order such companies to pay up within a designated period, and may further apply to the People’s Court for mandatory
enforcement against those who still fail to comply after the expiry of such period.

According to Interpretation
IV of the Supreme People’s Court of Several Issues on the Application of Law in the Trail of Labor Dispute Cases, employees
who perform the non-competition obligations after the termination of the labor contract can claim a monthly payment of economic
indemnity from the employer as per 30% of the employee’s average monthly salary for the 12 months before the termination
of the labor contract. If the employer refuses to pay the economic indemnity, the employee can refuse to perform the non-competition
obligations.

Regulations
on Tax in the PRC

Income
Tax

In January 2008, the
PRC Enterprise Income Tax Law took effect, which was last amended by the Standing Committee of the National People’s Congress
on December 29, 2018. On December 6, 2007, the State Council enacted the Regulations for the Implementation of the Law on Enterprise
Income Tax, which was recently amended on April 23, 2019, together with the PRC Enterprise Income Tax Law, the EIT Law. Under
the EIT Law, both resident enterprises and non-resident enterprises are subject to tax in the PRC. Resident enterprises are defined
as enterprises that are established in China in accordance with PRC laws, or that are established in accordance with the laws
of foreign countries but are actually or in effect controlled within the PRC. Non-resident enterprises are defined as enterprises
that are organized under the laws of foreign countries and whose “de facto management body” is conducted outside the
PRC, but have established institutions or premises in the PRC, or have no such established institutions or premises but have income
generated from inside the PRC. The EIT Law applies a uniform 25% enterprise income tax rate to both resident enterprises and non-resident
enterprises, except where tax incentives are granted to special industries and projects. However, if non-resident enterprises
have not formed permanent establishments or premises in the PRC, or if they have formed permanent establishment or premises in
the PRC but there is no actual relationship between the relevant income derived in the PRC and the established institutions or
premises set up by them, enterprise income tax is set at the rate of 20% with respect to their income sourced from inside the
PRC. According to the EIT Law and the Announcement on Issues concerning the Implementation of the Preferential Income Tax Policies
regarding High-Tech Enterprises promulgated by the SAT on June 19, 2017, enterprises qualified as “high-tech enterprises”
are entitled to a 15% enterprise income tax rate rather than the 25% uniform statutory tax rate. The preferential tax treatment
continues as long as an enterprise can retain its “high-tech enterprise” status.

The implementation
rules define the term “de facto management body” as the body that exercises full and substantial control and overall
management over the business, productions, personnel, accounts, and properties of an enterprise. Under the EIT Law and its implementation
regulations, dividends generated from the business of a PRC subsidiary after January 1, 2008, and payable to its foreign investor
may be subject to a withholding tax rate of 10 percent if the PRC tax authorities determine that the foreign investor is a non-resident
enterprise which do not have an establishment or place of business in the PRC, or which have such establishment or place of business
but the relevant income is not effectively connected with the establishment or place of business, to the extent such dividends
are derived from sources within the PRC, unless there is a tax treaty with China that provides for a preferential withholding
tax rate. Distributions of earnings generated before January 1, 2008, are exempt from PRC withholding tax.

In January 2009, the
SAT promulgated the Provisional Measures for the Administration of Withholding of Enterprise Income Tax for Non-resident Enterprises,
or the Non-resident Enterprises Measures, which was repealed by Announcement of the State Administration of Taxation on Issues
Relating to Withholding at Source of Income Tax of Non-resident Enterprises in December 2017. According to the new announcement,
which was amended on June 15, 2018, it shall apply to handling of matters relating to withholding at source of income tax of non-resident
enterprises pursuant to the provisions of Article 37, Article 39 and Article 40 of the Enterprise Income Tax Law. According to
Article 37, Article 39 of the Enterprise Income Tax Law, income tax over non-resident enterprise income pursuant to the provisions
of the third paragraph of Article 3 shall be subject to withholding at the source, where the payer shall act as the withholding
agent. The tax amount for each payment made or due shall be withheld by the withholding agent from the amount paid or payable.
Where a withholding agent fails to withhold tax or perform tax withholding obligations pursuant to the provisions of Article 37,
the taxpayer shall pay tax at the place where the income is derived. Where the taxpayer fails to pay tax pursuant to law, the
tax authorities may demand payment of the tax amount payable, from a payer of the taxpayer with payable tax amounts from other
taxable income items in China.

On April 30, 2009,
the Ministry of Finance of the PRC, or the MOF, and the SAT jointly issued the Circular on Issues Concerning Treatment of Enterprise
Income Tax in Enterprise Restructuring Business, or Circular 59, which became effective retroactively as of January 1, 2008 and
was partially revised on January 1, 2014. By promulgating and implementing this circular, the PRC tax authorities have enhanced
their scrutiny over the direct or indirect transfer of equity interests in a PRC resident enterprise by a non-resident Enterprise.

On February 3, 2015,
the SAT issued the Announcement of the State Administration of Taxation on Several Issues Relating to Enterprise Income Tax on
Indirect Transfers of Assets by Non-resident Enterprises, or SAT Bulletin 7, which was partially abolished on December 1, 2017
and December 29, 2017. SAT Bulletin 7 extends its tax jurisdiction to transactions involving transfer of immovable property in
China and assets held under the establishment, and placement in China, of a foreign company through the offshore transfer of a
foreign intermediate holding company. SAT Bulletin 7 also addresses transfer of the equity interest in a foreign intermediate
holding company broadly. In addition, SAT Bulletin 7 introduces safe harbor scenarios applicable to internal group restructurings.
However, it also brings challenges to both the foreign transferor and transferee of the indirect transfer as they have to assess
whether the transaction should be subject to PRC tax and to file or withhold the PRC tax accordingly.

On October 17, 2017,
the SAT issued the Announcement of the State Administration of Taxation on Issues Concerning the Withholding of Non-resident Enterprise
Income Tax at Source, or SAT Bulletin 37, which came into effect on December 1, 2017 and was revised on June 15, 2018. The SAT
Bulletin 37 further clarifies the practice and procedure of withholding of non-resident enterprise income tax and provides that:

· for
the income from equity investment assets, the competent tax authority for the income
tax of the invested enterprise shall be the competent tax authority, while for the income
from the dividends, extra dividends and other equity investment, the competent tax authority
for the income tax of the enterprise distributing the income shall be the competent tax
authority;

· the
withholding obligator shall declare and pay the withheld tax to the competent tax authority
in the place where such withholding obligator is located within seven (7) days from the
date of occurrence of the withholding obligation;

· where
the income obtained by the withholding obligator and required to be withheld at source
is in the form of dividends, extra dividends or any other equity investment gains, the
date of occurrence of the obligation for withholding relevant payable tax is the date
of actual payment of the dividends, extra dividends or other equity investment gains;

· for
the income tax required to be withheld under Article 37 of the Enterprise Income Tax
Law, if the withholding obligator fails to withhold in accordance with the law or is
unable to perform withholding obligation, the non-resident enterprise obtaining the income
shall declare and pay the tax not withheld to the competent tax authority of the place
of the occurrence of the income in accordance with Article 39 of the Enterprise Income
Tax Law and complete the Form of Report on Withholding of Enterprise Income Tax of the
People’s Republic of China; where the non-resident enterprise fails to declare
and pay tax in accordance with Article 39 of the Enterprise Income Tax Law, the tax authority
may order it to pay the tax within a specified time limit and the non-resident enterprise
shall declare and pay the tax within the time limit determined by the tax authority;
the non-resident enterprise that declares and pays the tax voluntarily before the tax
authority orders it to pay tax within a specified time limit shall be deemed as having
paid tax as scheduled;

· the
competent tax authority may require the taxpayer, withholding obligator and relevant
parties with knowledge of relevant information to provide the contracts and other relevant
materials relating to the withholding of tax;

where the withholding
obligator fails to withhold the tax required to be withheld under Article 37 of the Enterprise Income Tax Law, the competent tax
authority of the place where the withholding agent is located shall order the withholding obligator to make up for the withholding
of tax in accordance with Article 23 of the Administrative Punishment Law of the People’s Republic of China and hold the
withholding agent liable in accordance with the law; if recovery of tax payment from the taxpayer is necessary, the competent
tax authority of the place where the income occurs shall implement the recovery in accordance with the law. If the place where
the withholding obligator is located is different from the place where the income occurs, the competent tax authority of the place
of occurrence of the income that is responsible for recovering the tax payment shall give notice to the competent tax authority
of the place where the withholding obligator is located for verifying relevant information. The competent tax authority of the
place where the withholding agent is located shall, within five (5) working days from the date.

If non-resident investors
were involved in our private equity financing, if such transactions were determined by the tax authorities to lack reasonable
commercial purpose, we and our non-resident investors may be at risk of being required to file a return and be taxed under SAT
Bulletin 7 and we may be required to expend valuable resources to comply with SAT Bulletin 7 or to establish that we should not
be held liable for any obligations under SAT Bulletin 7.

Pursuant to an Arrangement
Between the Mainland of China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and the Prevention
of Fiscal Evasion with respect to Taxes on Income, or the Double Tax Avoidance Arrangement promulgated by the State Administration
of Taxation on 21 August, 2006, and other applicable PRC laws, if a Hong Kong resident enterprise is determined by the competent
PRC tax authority to have satisfied the relevant conditions and requirements under such Double Tax Avoidance Arrangement and other
applicable laws, the 10% withholding tax on the dividends the Hong Kong resident enterprise receives from a PRC resident enterprise
may be reduced to 5%. However, based on the Circular on Certain Issues with Respect to the Enforcement of Dividend Provisions
in Tax Treaties, or the SAT Circular 81, issued on February 20, 2009 by the SAT, if the relevant PRC tax authorities determine,
in their discretion, that a company benefits from such reduced income tax rate due to a structure or arrangement that is primarily
tax-driven, such PRC tax authorities may adjust the preferential tax treatment.

Value-Added
Tax

According to the
Temporary Regulations on Value-added Tax, which was promulgated by the State Council on December 13, 1993 and was most recently
amended on November 19, 2017, and the Detailed Implementing Rules of the Temporary Regulations on Value-added Tax, which was promulgated
by the MOF on December 25, 1993 and was amended on October 28, 2011, and became effective on November 1, 2011, all taxpayers selling
goods, providing processing, repair or replacement services or importing goods within the PRC shall pay Value-Added Tax. The tax
rate of 17% shall be levied on general taxpayers selling or importing various goods and providing processing, repairing or replacement
service; the applicable rate for the export of goods and cross-border sale of services and intangible assets by domestic organizations
and individuals within the scope stipulated by the State Council shall be nil, unless otherwise stipulated. On April 4, 2018,
the MOF and the SAT jointly issued the Notice of Adjustment of Value-added Tax Rates which declared that the VAT tax rate in regard
to the sale of goods, provision of processing, repairs and replacement services and importation of goods into China shall be reduced
from the previous 17% to 16% from May 1, 2018.  According to the PRC VAT Regulations, the VAT rate for sale of services
and sale of intangible properties is 6% unless otherwise specified.

Furthermore, according
to the Trial Scheme for the Conversion of Business Tax to Value-added Tax, which was promulgated by the MOF and the SAT on November
16, 2011, the PRC began to launch taxation reforms in a gradual manner from January 1, 2014, whereby the collection of value-added
tax in lieu of business tax items was implemented on a trial basis in regions showing significant radiating effects in economic
development and providing outstanding reform examples, beginning with production service industries such as transportation and
certain modern service industries.

In accordance with
the Circular on Notice of Comprehensive Promotion of Conversion of Business Tax to Value-added Tax promulgated by the SAT and
the MOF which took effect on May 1, 2016, upon approval of the State Council, the pilot program of the collection of value-added
tax in lieu of business tax shall be promoted nationwide in a comprehensive manner starting May 1, 2016, and all taxpayers of
business tax engaged in the building industry, the real estate industry, the financial industry and the life service industry
shall be included in the scope of the pilot program with regard to payment of value-added tax instead of business tax. Our main
business is included in the scope of the pilot program with regard to payment of value-added tax instead of business tax.

On November 19, 2017,
the State Council promulgated the Decision of State Council on Abolition of the Provisional Regulations of the PRC on Business
Tax and Revision of the Provisional Regulations of the PRC on Value-added Tax, which took effective on the same date, to formally
abolish the Provisional Regulations of the People’s Republic of China on Business Tax and amend the Temporary Regulations
on Value-added Tax accordingly.

Regulations
on Foreign Exchange

Foreign
Currency Exchange

Pursuant to the Foreign
Currency Administration Rules, as amended, and various regulations issued by SAFE and other relevant PRC government authorities,
Renminbi is freely convertible to the extent of current account items, such as trade related receipts and payments, interest and
dividends. Capital account items, such as direct equity investments, loans and repatriation of investment, unless expressly exempted
by laws and regulations, still require prior approval from SAFE or its provincial branch for conversion of Renminbi into a foreign
currency, such as U.S. dollars, and remittance of the foreign currency outside of the PRC. Payments for transactions that take
place within the PRC must be made in Renminbi. Foreign currency revenues received by PRC companies may be repatriated into China
or retained outside of China in accordance with requirements and terms specified by SAFE. Foreign exchange proceeds under the
current accounts may be either retained or sold to a financial institution engaged in settlement and sale of foreign exchange
pursuant to relevant SAFE rules and regulations. For foreign exchange proceeds under the capital accounts, approval from the SAFE
is generally required for the retention or sale of such proceeds to a financial institution engaged in settlement and sale of
foreign exchange.

Pursuant to the Circular
of the SAFE on Further Improving and Adjusting Foreign Exchange Administration Policies for Direct Investment, or the SAFE Circular
59 promulgated by SAFE on November 19, 2012, which became effective on December 17, 2012 and was further amended on May 4, 2015
and October 10, 2018, approval is not required for opening a foreign exchange account and depositing foreign exchange into the
accounts relating to the direct investments. SAFE Circular 59 also simplified foreign exchange-related registration required for
the foreign investors to acquire the equity interests of PRC companies and further improve the administration on foreign exchange
settlement for FIEs.

On February 13, 2015,
the SAFE promulgated the Circular on Simplifying and Improving the Foreign Currency Management Policy on Direct Investment, or
the SAFE Circular 13, effective from June 1, 2015, which cancels the administrative approvals of foreign exchange registration
of direct domestic investment and direct overseas investment. In addition, SAFE Circular 13 simplifies the procedure of foreign
exchange-related registration, under which investors shall register with banks for direct domestic investment and direct overseas
investment.

On April 10, 2020
the SAFE issued the Notice of the SAFE on Optimizing Foreign Exchange Administration to Support the Development of Foreign-related
Business, or the SAFE Circular 8. The SAFE Circular 8 provides that under the condition that the use of the funds is genuine and
compliant with current administrative provisions on use of income relating to capital account, enterprises are allowed to use
income under capital account such as capital funds, foreign debts and overseas listings for domestic payment, without submission
to the bank prior to each transaction of materials evidencing the veracity of such payment.

Dividend
Distribution

The principal laws
and regulations regulating the dividend distribution of dividends by FIEs in the PRC include the Company Law of the PRC, as recently
amended in 2018 and Foreign Investment Law promulgated by SCNPC on March 15, 2019 and recently came into effect on January 1,
2020.

Wholly foreign-owned
enterprises and Sino-foreign equity joint ventures in the PRC may pay dividends only out of their accumulated profits, if any,
as determined in accordance with PRC accounting standards and regulations. Additionally, these FIEs may not pay dividends unless
they set aside at least 10% of their respective accumulated profits after tax each year, if any, to fund certain reserve funds,
until such time as the accumulative amount of such fund reaches 50% of the enterprise’s registered capital. These reserves are
not distributable as cash dividends. A PRC company shall not distribute any profits until any losses from prior fiscal years have
been offset. Profits retained from prior fiscal years may be distributed together with distributable profits from the current
fiscal year. In addition, these companies also may allocate a portion of their after-tax profits based on PRC accounting standards
to employee welfare and bonus funds at their discretion.

Regulations
Related to Mergers and Acquisitions and Overseas Listings

On August 8, 2006,
six PRC governmental and regulatory agencies, including MOFCOM and the China Securities Regulatory Commission, or the CSRC, promulgated
the Rules on Acquisition of Domestic Enterprises by Foreign Investors, or the M&A Rules, governing the mergers and acquisitions
of domestic enterprises by foreign investors that became effective on September 8, 2006 and was revised on June 22,
2009. The M&A Rules, among other things, requires that offshore special purpose vehicles that are controlled by PRC companies
or individuals and that have been formed for overseas listing purposes through acquisitions of PRC domestic interest held by such
PRC companies or individuals, to obtain the approval of the CSRC prior to publicly listing their securities on an overseas stock
exchange.

Regulations
Relating to Foreign Exchange Registration of Overseas Investment by PRC Residents

The Circular of the
State Administration of Foreign Exchange on Issues Concerning the Foreign Exchange Administration over the Overseas Investment
and Financing and Round-trip Investment by Domestic Residents via Special Purpose Vehicles, or the SAFE Circular 37, issued by
SAFE and effective on July 4, 2014, regulates foreign exchange matters in relation to the use of special purpose vehicles, or
SPVs by PRC residents or entities to seek offshore investment and financing and conduct round trip investment in China. Under
Circular 37, a SPV refers to an offshore entity established or controlled, directly or indirectly, by PRC residents or entities
for the purpose of seeking offshore financing or making offshore investment, using legitimate domestic or offshore assets or interests,
while « round trip investment » refers to the direct investment in China by PRC residents or entities through SPVs, namely,
establishing foreign invested enterprises to obtain the ownership, control rights and management rights. SAFE Circular 37 requires
that, before establishing, controlling and making contribution into a SPV, PRC residents or entities are required to complete
foreign exchange registration with the SAFE or its local branch.15

PRC residents or
entities who have contributed legitimate domestic or offshore interests or assets to SPVs but have yet to obtain SAFE registration
before the implementation of SAFE Circular 37 shall register their ownership interests or control in such SPVs with SAFE or its
local branch. An amendment to the registration is required if there is a material change in the registered SPV, such as any change
of basic information (including change of such PRC « resident’s name » and operation term), increases or decreases in
investment amounts, transfers or exchanges of shares, or mergers or divisions. Failure to comply with the registration procedures
set forth in SAFE Circular 37, or making misrepresentation on or failure to disclose controllers of a FIE that is established
through round-trip investment, may result in restrictions on the foreign exchange activities of the relevant FIEs, including payment
of dividends and other distributions, such as proceeds from any reduction in capital, share transfer or liquidation, to its offshore
parent or affiliate, and the capital inflow from the offshore parent, and may also subject relevant PRC residents or entities
to penalties under PRC foreign exchange administration regulations. On February 13, 2015, SAFE further promulgated the Circular
on Further Simplifying and Improving the Administration of the Foreign Exchange Concerning Direct Investment, or SAFE Circular
13, which took effect on June 1, 2015. SAFE Circular 13 has amended SAFE Circular 37 by requiring PRC residents or entities to
register with qualified banks rather than SAFE or its local branch in connection with their establishment or control of an offshore
entity established for the purpose of overseas investment or financing.

As of the date of
this prospectus, to our knowledge, all of our shareholders had registered according to SAFE Circular 37.

On March 30, 2015,
the SAFE promulgated Circular 19, which came into effect on June 1, 2015 and was partially repealed on December 30, 2019. According
to Circular 19, the foreign exchange capital of FIEs shall be subject to the Discretional Foreign Exchange Settlement. The Discretional
Foreign Exchange Settlement refers to the foreign exchange capital in the capital account of a FIE for which the rights and interests
of monetary contribution has been confirmed by the local foreign exchange bureau (or the book-entry registration of monetary contribution
by the banks) can be settled at the banks based on the actual operational needs of the FIE. The proportion of Discretional Foreign
Exchange Settlement of the foreign exchange capital of a FIE is temporarily determined to be 100%. The Renminbi converted from
the foreign exchange capital will be kept in a designated account and if a FIE needs to make further payment from such account,
it still needs to provide supporting documents and go through the review process with the banks. Circular 19 allows all foreign-invested
enterprises established in China to use their foreign exchange capitals to make equity investment and prohibits foreign-invested
enterprises from, among other things, using Renminbi fund converted from its foreign exchange capitals for expenditure beyond
its business scope and providing entrusted loans or repaying loans between non-financial enterprises.

SAFE issued the Circular
on Reforming and Regulating Policies on the Control over Foreign Exchange Settlement of Capital Accounts, or Circular 16, on June
9, 2016, which became effective simultaneously. Pursuant to Circular 16, enterprises registered in the PRC may also convert their
foreign debts from foreign currency to Renminbi on a discretionary basis. Circular 16 provides an integrated standard for conversion
of foreign exchange under capital account items (including foreign currency capital and foreign debts) on a discretionary basis
which applies to all enterprises registered in the PRC. Circular 16 reiterates the principle that Renminbi converted from foreign
currency-denominated capital of a company may not be directly or indirectly used for purposes beyond its business scope or prohibited
by PRC laws or regulations, while such converted Renminbi shall not be provided as loans to its non-affiliated entities. As Circular
16 is newly issued and SAFE has not provided detailed guidelines with respect to its interpretation or implementations, it is
uncertain how these rules will be interpreted and implemented. Circular 19, Circular 16 and other related regulations may delay
or limit us from using the proceeds of offshore offerings to make additional capital contributions or loans to our PRC subsidiaries
and any violations of these circulars could result in severe monetary or other penalties.

Regulations
on loans to and direct investment in the PRC entities by offshore holding companies

According to the
Implementation Regulations on Statistics and Supervision of Foreign Debt promulgated by SAFE on September 24, 1997 and the Interim
Measures on the Management of Foreign Debts promulgated by SAFE, the NDRC and the MOF and effective from March 1, 2003, loans
by foreign companies to their subsidiaries in China, which accordingly are FIEs, are considered foreign debt, and such loans must
be registered with the local branches of the SAFE. Under the provisions, the total amount of accumulated medium-term and long-term
foreign debt and the balance of short-term debt borrowed by a FIE is limited to the difference between the total investment and
the registered capital of the foreign invested enterprise.

On January 12, 2017,
the People’s Bank of China promulgated the Circular of the People’s Bank of China on Matters relating to the Macro-prudential
Management of Comprehensive Cross-border Financing, or PBOC Circular 9, which took effect on the same date. The PBOC Circular
9 established a capital or net assets-based constraint mechanism for cross-border financing. Under such mechanism, a company may
carry out cross-border financing in Renminbi or foreign currencies at their own discretion. The total cross-border financing of
a company shall be calculated using a risk-weighted approach and shall not exceed an upper limit. The upper limit is calculated
as capital or assets multiplied by a cross-border financing leverage ratio and multiplied by a macro-prudential regulation parameter.

In addition, according
to PBOC Circular 9, as of the date of the promulgation of PBOC Circular 9, a transition period of one year is set for foreign-invested
enterprises and during such transition period, FIEs may apply either the current cross-border financing management mode, namely
the mode provided by Implementation Rules for the Provisional Regulations on Statistics and Supervision of Foreign Debt and the
Interim Provisions on the Management of Foreign Debts, or the mode in this PBOC Circular 9 at its sole discretion. After the end
of the transition period, the cross-border financing management mode for FIEs will be determined by the People’s Bank of China
and SAFE after assessment based on the overall implementation of this PBOC Circular 9. However, although the transitional period
ended on January 10, 2018, as of the date of this prospectus, neither PBOC nor SAFE has issued any new regulations regarding the
appropriate means of calculating the maximum amount of foreign debt for foreign-invested enterprises. Domestic-invested enterprises,
have only been subject to the Net Assets Limit in calculating the maximum amount of foreign debt they may hold from the date of
promulgation of PBOC Circular 9.

Regulations Relating to Foreign Investment

The Guidance Catalogue of Industries
for Foreign Investment

Investment activities
in the PRC by foreign investors are governed by the Guidance Catalogue of Industries for Foreign Investment, or the Catalogue,
which was promulgated and is amended from time to time by the MOFCOM and the NDRC. The latest version of the Catalogue became
effective on July 23, 2020. The Guidance Catalogue stipulates restricted industries for foreign investment. The Negative List
stipulates the prohibited and restricted industries for foreign investment. The Encouragement Catalogue stipulates the encouraged
industries for foreign investment. The purpose of the Catalogue is to direct foreign investment into certain priority industry
sectors while restricting or prohibiting investment in other sectors. If the investment falls within the “encouraged”
category, foreign investment can be conducted through the establishment of a wholly foreign-owned enterprise. If the investment
falls within the “restricted” category, foreign investment may be conducted through the establishment of a wholly
foreign-owned enterprise if certain requirements are met or in some cases must be conducted through the establishment of a joint
venture enterprise, with varying minimum shareholdings for the Chinese party, depending on the particular industry. If the investment
falls within the “prohibited” category, foreign investment of any kind is not allowed. Any investment that occurs
within an industry not falling into any of three categories is classified as a permitted industry for foreign investment According
to the Negative List, other than E-commerce, domestic multiparty communication, store and forward, and call center services, the
permitted foreign investment in value-added telecommunications service providers may not be more than 50%.

The Foreign Investment Law

On March 15, 2019,
the National People’s Congress approved the Foreign Investment Law, which took effect on January 1, 2020 and replaced three
existing laws on foreign investments in China, namely, the PRC Sino-foreign Equity Joint Ventures Law, the PRC Sino-foreign Cooperative
Enterprises Law and the PRC Wholly Foreign-owned Enterprises Law, together with their implementation rules and ancillary regulations.
The Foreign Investment Law embodies an expected PRC regulatory trend to rationalize its foreign investment regulatory regime in
line with prevailing international practice and the legislative efforts to unify the corporate legal requirements for both foreign
and domestic invested enterprises in China. The Foreign Investment Law establishes the basic framework for the access to, and
the promotion, protection and administration of foreign investments in view of investment protection and fair competition.

According to the
Foreign Investment Law, “foreign investment” refers to investment activities directly or indirectly conducted by one
or more natural persons, business entities, or otherwise organizations of a foreign country (collectively referred to as “foreign
investor”) within China, and the investment activities include the following situations: (i) a foreign investor, individually
or collectively with other investors, establishes a foreign-invested enterprise within China; (ii) a foreign investor acquires
stock shares, equity shares, shares in assets, or other like rights and interests of an enterprise within China; (iii) a foreign
investor, individually or collectively with other investors, invests in a new project within China; and (iv) investments in other
means as provided by laws, administrative regulations, or the State Council.

According to the
Foreign Investment Law, the State Council will publish or approve to publish the “negative list” for special administrative
measures concerning foreign investment. The Foreign Investment Law grants national treatment to FIEs, except for those FIEs that
operate in industries deemed to be either “restricted” or “prohibited” in the “negative list”.
Because the “negative list” for year 2021 has yet to be published, it is unclear whether it will differ from the current
2020 Negative List The Foreign Investment Law provides that FIEs operating in foreign restricted industries will require market
entry clearance and other approvals from relevant PRC governmental authorities. If a foreign investor is found to invest in any
prohibited industry in the “negative list”, such foreign investor may be required to, among other aspects, cease its
investment activities, dispose of its equity interests or assets within a prescribed time limit and have its income confiscated.
If the investment activity of a foreign investor is in breach of any special administrative measure for restrictive access provided
for in the “negative list”, the relevant competent department shall order the foreign investor to make corrections
and take necessary measures to meet the requirements of the special administrative measure for restrictive access.

On December 27, 2020,
the NDRC and the MOFCOM promulgated the Catalog of Industries for Encouraging Foreign Investment (2020 Version), or the Encouragement
Catalogue, which became effective on January 27, 2021, replacing the previous encouragement catalogue. On June 23, 2020, the NDRC
and the MOFCOM promulgated the Special Management Measures (Negative List) for the Access of Foreign Investment (2020 Version),
or the Negative List, which became effective on July 23, 2020, replacing previous negative list. According to the Negative List
and the Encouragement Catalogue, the value-added telecommunications business that we are operating, other than call center business,
falls into the restricted category.

On December 30, 2019,
the MOFCOM and the State Administration for Market Regulation (formerly known as the State Administration for Industry and Commerce)
jointly promulgated the Measures for Reporting of Foreign Investment Information, or the Foreign Investment Reporting Measures,
which came into effect on January 1, 2020 and replaced the Interim Administrative Measures for the Record-filing of the Establishment
and Modification of Foreign-invested Enterprises. The Foreign Investment Reporting Measures establish an online reporting system
for foreign investment instead of the previous requirement of the Ministry of Commerce of the PRC filing and/or approval procedures.
Pursuant to the Foreign Investment Reporting Measures, for foreign investment carried out directly or indirectly within the mainland
China, foreign investors or foreign-invested enterprises shall submit investment information for establishments, modifications
and dissolution and annual reports of the foreign-invested enterprises on the online. Meanwhile, the PRC establishes foreign investment
security review system under which the security review shall be conducted on foreign investments affecting or likely to affect
the state security, a decision legally made on security review will be considered as final. Furthermore, the Foreign Investment
Law provides that FIEs established according to the previous PRC Sino-foreign Equity Joint Ventures Law, the PRC Sino-foreign
Cooperative Enterprises Law and the PRC Wholly Foreign-owned Enterprises Law before the Foreign Investment Law took effect may
maintain their structure and corporate governance within five years after the implementing of the Foreign Investment Law.

In addition, the
Foreign Investment Law also provides several protective rules and principles for foreign investors and their investments in the
PRC, including, among others, that a foreign investor may freely transfer into or out of China, in Renminbi or a foreign currency,
its contributions, profits, capital gains, income from disposition of assets, royalties of intellectual property rights, indemnity
or compensation lawfully acquired, and income from liquidation, among others, within China; local governments shall abide by their
commitments to the foreign investors; governments at all levels and their departments shall enact local normative documents concerning
foreign investment in compliance with laws and regulations and shall not impair legitimate rights and interests, impose additional
obligations onto FIEs, set market access restrictions and exit conditions, or intervene with the normal production and operation
activities of FIEs; except for special circumstances, in which case statutory procedures shall be followed and fair and reasonable
compensation shall be made in a timely manner, expropriation or requisition of the investment of foreign investors is prohibited;
and mandatory technology transfer is prohibited.

On December 19, 2020,
the NDRC and the MOFCOM promulgated Measures for Security Review of Foreign Investment, with an effective date of January 18,
2021. The Foreign Investment Security Review Mechanism (the “Security Review Mechanism”) in charge of organization,
coordination and guidance of foreign investment security review is thereunder established. A working mechanism office shall be
established under the NDRC and led by the NDRC and the Ministry of Commerce to undertake routine work on the security review of
foreign investment. According to the Security Review Mechanism, foreign investment activities falling in the scope such as important
cultural products and services, important information technologies and Internet products and services, important financial services,
key technologies and other important fields that concern state security while obtaining the actual control over the enterprises
invested in, a foreign investor or a party concerned in the PRC shall take the initiative to make a declaration to the working
mechanism office prior to making the investment.

Company Law

Pursuant to the PRC
Company Law, promulgated by the Standing Committee of the National People’s Congress on December, 29 1993, effective as
of July 1, 1994, and as revised on December 25, 1999, August 28, 2004, October 27, 2005, December 28, 2013 and October 26, 2018,
the establishment, operation and management of corporate entities in the PRC are governed by the PRC Company Law. The PRC Company
Law defines two types of companies: limited liability companies and companies limited by shares. Our PRC operating subsidiary
is a limited liability company. Unless otherwise stipulated in the related laws on foreign investment, foreign invested companies
are also required to comply with the provisions of the PRC Company Law.

Laws and Regulations on the Protection
of Consumer Rights and Interests

Business operators
in the business of supplying and selling manufactured goods or services to consumers, shall comply with the Law of the PRC on
the Protection of Consumer Rights and Interests, or the Consumer Rights Protection Law, promulgated by the SCNPC on October 31,
1993, and effective as of January 1, 1994, and revised on August 27, 2009 and October 25, 2013.

According to the
Consumer Rights Protection Law, business operators must ensure that the goods or services provided by them meet the requirements
for safeguarding personal and property safety. For goods and services that may endanger personal and property safety, consumers
should be provided with a true description and an explicit warning, as well as a description and indication of the proper way
to use the goods or accept the services and the methods of preventing the occurrence of a hazard. If the goods or services provided
by the business operators cause personal injuries to consumers or third parties, the business operators shall compensate the injured
parties for their losses.

Laws on Contracts

On May 28, 2020,
the Civil Code of the PRC was issued by the NPC and became effective on January 1, 2021 and replaced the General Principles of
the Civil Law of the PRC, the Security Law of the PRC, the Contract Law of the PRC, the Real Right Law of the PRC, the General
Rules of the Civil Law of the PRC and several other basic civil laws in the PRC. All of our contracts are subject to the Civil
Code of the PRC. Under the Civil Code of the PRC, a natural person, legal person or other legally established organization shall
have full capacity of civil right and civil conduct in order to enter into a valid contract. Except as otherwise required by other
laws and regulations, the formation, validity, performance, modification, assignment, termination, and liability for breach of
a contract are governed by the Civil Code of the PRC. A contracting party who failed to perform or failed to fulfill its contractual
obligation shall bear the responsibility of a continued duty to perform or to provide remedies and compensation as provided by
PRC laws.

Standardization Law of the People’s
Republic of China

Standardization Law
of the People’s Republic of China was passed by the fifth session of the Standing Committee of the Seventh National People’s
Congress on December 29, 1988, and revised on November 4, 2017. This law is formulated for the purposes of enhancing standardization
work, promoting scientific and technological advancement, improving the quality of products and services, safeguarding personal
health and life and property security, protecting state security and ecological environmental security, raising the level of economic
and social development. This law applies to technical requirements that need to be unified for agricultural field, industrial
field, service industry, social undertakings industry, and others. Enterprises which manufacture, sell, import products or provide
services that fail to meet the mandatory standards, and enterprises which manufacture products or provide services that fail to
meet the technical requirements under their publicized standardization, shall undertake civil liabilities.

Regulations of the People’s Republic
of China on Certification and Accreditation

Regulations of the
People’s Republic of China on Certification and Accreditation became effective as of September 3, 2003, and was later revised
on February 6, 2016. This regulation is formulated for the purposes of standardizing certification and accreditation, improving
the quality of products and services and management standard. This regulation applies to all certification agencies, certification
services and accreditation services in the PRC, excluding certification on quality management standardization of enterprises engaging
in pharmaceutical productions and/or operations, certification on quality of laboratory animals, certification of military products,
accreditation on laboratories and personnel engaging in the calibration and testing of military products.

MANAGEMENT

Directors and Executive Officers

The following table
sets forth information regarding our directors and executive officers as of the date of this prospectus. Unless otherwise stated,
the business address for our directors and executive officers is that of our principal executive offices located at Room 12A05,
Block A, Boya International Center, Building 2, No. 1 Courtyard, Lize Zhongyi Road, Chaoyang District, Beijing, China 100102.

Name Age Position
Yimin Wu 54 Chairman of the Board of Directors and Chief Executive Officer
Lianfang Zhou 43 Chief Financial Officer
Chunhsiang Chen 59 Chief Technology Officer and Vice President
Hsiaochien Tseng 49 Executive Vice President
Dongliang Jiang 55 Director
Hanbin Xiao 50 Director
Harry D. Schulman(1) 69 Independent Director
Feng Liu(1)(2) 52 Independent Director
Zhixiong Wang(1)(2)(3) 57 Independent Director
Xuan Li(3) 53

Independent Director

(1) Member of audit committee.

(2) Member of compensation committee.

(3) Member of nomination and governance
committee.

Yimin Wu has
served as a member of our board of directors since March 2020, the chairman of our board of directors since June 2020, and our
chief executive officer since May 2020. Mr. Wu founded Infobird Beijing, our VIE, in October 2001 and has served as the chairman
of the board of directors and chief executive officer of Infobird Beijing since such time. Mr. Wu is also a shareholder of Infobird
Beijing. From August 1990 to March 1993, Mr. Wu served as software engineer of the Software Center of Tsinghua University and
was sent to the United States to co-develop HP_UX operating system at HP, Inc., an American multinational information technology
company. From April 1993 to May 2000, Mr. Wu served as general manager of Beijing Jing Zhou Computers, Co., Ltd., a company responsible
for marketing and developing interactive voice response systems. From July 2000 to October 2001, Mr. Wu served as general manager
of Beijing Jing Zhou Rong Hua Internet Technology, Co., Ltd., a company responsible for developing middleware for call centers.
Mr. Wu received a Bachelor’s Degree and a Master’s Degree in Computer Sciences from Tsinghua University. We believe
Mr. Wu’s over 30 years of experience qualifies him to serve as the chairman of our board of directors and as our chief executive
officer.

Lianfang Zhou
has served as our chief financial officer since May 2020 and as the finance director of Infobird Beijing since May 2020.
Mrs. Zhou also served as the finance manager of Infobird Beijing from February 2010 to April 2020. With over 10 years of services
at Infobird Beijing, Mrs. Zhou is profoundly experienced and familiar with the general management and operation of the finance
and accounting department. From September 2004 to July 2008, Mrs. Zhou served as head of accounting of Beijing Saishuo Technology
Co., Ltd., a software development company that specializes in port services. From August 2008 to December 2009, Mrs. Zhou served
as head of accounting of Beijing Lianhe Lida Investment Co., Ltd., a property management services company. Mrs. Zhou holds the
intermediate accountant qualification certificate issued by the Ministry of Finance of the PRC. Mrs. Zhou received a Bachelor’s
Degree in Accounting from Renmin University of China. We believe Mrs. Zhou’s extensive experience qualifies her to serve
as our chief financial officer.

Chunhsiang
Chen
has served as our chief technology officer and vice president since May 2020 and as the vice president of Infobird
Beijing since April 2012. From June 1990 to February 1993, Mr. Chen served as advisory programmer of International Business Machines
Corporation, during which he participated in the design and development of Multiple Protocol Transport Network. From February
1993 to September 1996, Mr. Chen served as an associate professor in the Information Education Department of the National Taiwan
Normal University. Mr. Chen founded GenNet Technology Co., Ltd., an information technology company, in June 1993 and served as
its president until March 2012. Mr. Chen received a Bachelor’s Degree in Computer Sciences from the National Chiao Tung
University and a Master’s Degree and Doctoral Degree in Computer Sciences from Northwestern University. We believe Mr. Chen’s
extensive experience qualifies him to serve as our chief technology officer and vice president.

Hsiaochien
Tseng
has served as our executive vice president since May 2020 and as the executive vice president of Infobird Beijing
since January 2020. From March 2010 to September 2018, Mr. Tseng served as sales director of the Credit Card Center of China Guangfa
Bank where he integrated and managed online and offline sales channels, established overall and regional sales strategies, and
constructed training systems to significantly increase the client base. From October 2018 to January 2020, Mr. Tseng served as
senior vice president of Hua Tuo Digital Technology Group Co., Ltd., a financial informational technology company, and was responsible
for building platforms for credit card sales and services, such as the payment aggregation platform, the installment payment platform,
and the benefits platform. Prior to that, Mr. Tseng accumulated experience in sales and marketing of credit cards while serving
as the head of the business development department of Far Eastern International Bank Co., Ltd. (TWSE: 2881) from January 2001
to November 2007 and as the head of the sales department of Fubon Financial Holding Co., Ltd. (TWSE: 2881; LSE: FBND), a financial
investment holding company, from November 2007 to March 2010. Mr. Tseng received a Bachelor’s Degree in Information Management
from Fu Jen Catholic University and a Master’s Degree in Business Administration from San Diego State University. We believe
Mr. Tseng’s extensive experience qualifies him to serve as our executive vice president.

Dongliang Jiang
has served as a member of our board of directors since June 2020 and as a director of Infobird Beijing since October 2001.
Mr. Jiang is also a shareholder of Infobird Beijing. Mr. Jiang founded Anhui Laolinju Internet Technology Co., Ltd., a fresh food
e-commerce platform, in October 2016 and has served as chief executive officer since such time. From March 2001 to September 2016,
Mr. Jiang served as vice president of Infobird Beijing, during which he was responsible for constructing the sales and marketing
team. He successfully led the sales and marketing team to initially acquire several large and reputable clients. Prior to that,
Mr. Jiang served as manager of Bioute International Engineering and Development Co., Ltd., a road construction company, from September
1885 to March 2001, and as associate researcher of Research Institute of Highway Ministry of Transport from October 1990 to August
1995. Mr. Jiang received a Bachelor’s Degree in Hydraulic Engineering from Tsinghua University and a Master’s Degree
in Civil Engineering from Zhejiang University. We believe Mr. Jiang’s extensive experience qualifies him to serve as our
director.

Hanbin Xiao
has served as a member of our board of directors since June 2020. Mr. Xiao has served as general manager of Jiangxi Yurun
Lida Equity Investment Management Co., Ltd., or Lida Equity Investment, since October 2014, where he was responsible for screening,
due diligence, negotiation, and post-investment management of target companies. Mr. Xiao has led the team of Lida Equity Investment
to complete several transactions. Mr. Xiao has also served as a member of the board of directors of several investment targets
of Lida Equity Investment, including Shanghai Kuiyue Electronic Technology Co., Ltd., Shanghai Shengzhi Photoelectric Technology
Co., Ltd., Beijing Sanwei Xin’an Technology Development Co., Ltd., and Wenzhou Fanbo Laser Co., Ltd. Mr. Jiang received
a Bachelor’s Degree in Electronic Engineering from Jiangxi Science and Technology Normal University. We believe Mr. Xiao’s
extensive experience qualifies him to serve as our director.

Harry D. Schulman,
a U.S. citizen, has served as a member of our board of directors since June 2020. Mr. Schulman has served as the chief executive
officer of HairClinical LLC, a consumer product company, since November 2016, a director nominee of Hezhong International (Holding)
Limited, an online peer-to-peer lending company, from August 2018 to June 2020, and a director of CDT Environmental Technology
Investment Holdings Limited, a waste treatment company, since March 2020. From April 2018 to November 2018, he also served as
a director of Q.E.P. Co., Inc., a worldwide manufacturer, marketer and distributor of a broad line of flooring tools and accessories
for the home improvement market. Since 2008, he has also served as President of HDS Consulting, LLC. From August 2008 to June
2010, he served as a director and chairman of the audit committee of Hancock Fabrics, Inc., a specialty retailer of crafts and
fabrics. From February 2008 to July 2014, he served as the operating partner of Baird Capital Partners, a private equity and venture
capital firm, during which he served on the board and advisory board of various companies Baird Capital Partners have invested
in, including Backyard Leisure, a BCP Fund IV portfolio company, Amoena GmbH, New Vitality LLC and Eckler’s LLC. Prior to
that, Mr. Schulman held various senior management roles in Applica Incorporated (NYSE: APN), a manufacturer and distributor of
a broad range of household appliances, from January 1989 to January 2007, including vice president (1989-1993), chief financial
officer (1989-1998), executive vice president (1994-1998), chief operating officer (1998-2004) and president and chief executive
officer (2004-2007). Mr. Schulman received a Bachelor’s Degree in Business Administration-Accounting from the University
of Dayton and a Master’s Degree in International Business from the University of Miami, Florida. We believe that Mr. Schulman’s
extensive experience qualifies him to serve as our director.

Feng Liu has
served as a member of our board of directors since June 2020. Mr. Liu has served as the chairman of the board of directors of
China Convoy (Beijing) Information Technology Group Co., Ltd., a one-stop service provider for Chinese students and volunteers
abroad, since July 2016. In July 2018, Mr. Liu also led the team to build the Center for International Exchange Personnel and
the International Talent Entrepreneurship Center in Chaoyang District, Beijing, aiming to gather talents with charitable activities.
Since December 2016 and July 2017, respectively, he has also served as the founder and managing director of two funds under China
Children and Teenagers’ Fund. From November 2006 to June 2010, Mr. Liu served as chief executive officer of Shizun (Beijing)
Electronic Technology Co., Ltd., during which he introduced advanced video compression technologies into the Chinese market. From
June 2010 to August 2012, Mr. Liu served as the chairman of the board of directors of Beijing Zhong Guang Xing Qiao Media Technology
Co., Ltd., a company that focuses on carrying out over-the-top television services, which are services that focus on the delivery
of television content via the internet. From October 2013 to May 2016 and from October 2015 to May 2016, Mr. Liu served as the
chairman of the board of directors of two media companies, Overseas Chinese Culture Media Co., Ltd. and Qiaowang Network Technology
Co., Ltd., where Mr. Liu led the team to provide Chinese culture television services, aiming to provide television services to
the Chinese community and to promote cultural exchange around the globe. Mr. Liu received a Bachelor’s Degree in Composition
from China Conservatory of Music and a Master’s Degree in Business Administration from New York Institute of Technology.
We believe Mr. Liu’s extensive experience qualifies him to serve as our director.

Zhixiong Wang
has served as a member of our board of directors since June 2020. Mr. Wang founded Ningbo Play Capital Investment Management
Co., Ltd., a private equity firm, in July 2017. Mr. Wang has also served as a member of the board of directors of Beijing Lion-Mark
Information Interactive Ltd. since June 2010. From November 2006 to January 2010, Mr. Wang served as managing director of the
China Office of International Game Technology (NYSE: IGT), a multinational gaming company. Prior to that, Mr. Wang served multiple
roles in various industries from January 1988 to June 2006, including assistant professor of Beijing Machinery Institute (1988-1991),
analyst of Euro-American Group Plc., Cal Futures (1991-1994), China analyst of Far Eastern Economic Review, Dow Jones & Co.
in Hong Kong (1994-1995), senior consultant of Claydon Gescher Associates Ltd (1995-1998), senior vice president of MIH Asia (1998-2001),
and managing director of Celestial Movie Channel (China) (2002-2006) Mr. Wang received a Bachelor’s Degree in Computer Science
and Technology from Tsinghua University and a Master’s Degree in Artificial Intelligence Management from University of Aeronautics
&Astronautics. We believe Mr. Wang’s extensive experience qualifies him to serve as our director.

Xuan Li has
served as a member of our board of directors since June 2020. Mr. Li has served as chief executive officer of IntelliCredit Co.,
Ltd since September 2013. IntelliCredit Co., Ltd is one of the companies accredited by People’s Bank of China (Central Bank)
to prepare for obtaining Consumer Credit Reporting Agency licenses. From October 2002 to April 2005, Mr. Li served as domain expert
in the credit bureau of People’s Bank of China. From April 2005 to September 2007, Mr. Li served as director of Technology
and Operations of Greater China of Experian Plc., a multinational consumer credit reporting company. From April 2008 to October
2009, Mr. Li served as the China Head of RCM Capital Management LLC, an affiliate of Allianz Global Investors Fund Management
LLC. From October 2009 to September 2013, Mr. Li served as chief executive officer of IntelliTrust Company, an anti-fraud software
development company. Mr. Li received a Bachelor’s Degree in Computer Science and Technology from Tsinghua University and
a Doctoral Degree in Management Science from Rutgers, The State University of New Jersey. We believe Mr. Li’s extensive
experience qualifies him to serve as our director.

None of the events
listed in Item 401(f) of Regulation S-K has occurred during the past ten years that is material to the evaluation of the ability
or integrity of any of our directors or executive officers.

Employment Agreements, Director Agreements
and Indemnification Agreements

We have entered into
employment agreements with each of our executive officers, pursuant to which such individuals have agreed to serve as our executive
officers until May 24, 2021. Such terms will be automatically extended for twelve-month periods, unless the agreements are terminated
in accordance with their terms. We may terminate the employment for cause at any time for certain acts, such as conviction or
plea of guilty to a felony or any crime involving moral turpitude, negligent or dishonest acts to our detriment, or misconduct
or a failure to perform agreed duties. We may also terminate the employment without cause at any time upon 60 days’ advance
written notice. Each executive officer may resign at any time upon 60 days’ advance written notice.

Each executive officer
has agreed to hold, both during and after the termination or expiry of his employment agreement, in strict confidence and not
to use, except as required in the performance of his duties in connection with the employment or pursuant to applicable law, any
of our confidential or proprietary information or the confidential or proprietary information of any third party received by us
and for which we have confidential obligations. Each executive officer has also agreed to disclose in confidence to us all inventions,
designs and trade secrets which he conceives, develops or reduces to practice during his employment with us and to assign all
right, title and interest in them to us, and assist us in obtaining and enforcing patents, copyrights and other legal rights for
these inventions, designs and trade secrets.

In addition, each
executive officer has agreed to be bound by non-competition and non-solicitation restrictions during the term of the employment
and for one year following the last date of employment. Specifically, each executive officer has agreed not to: (i) engage or
assist others in engaging in any business or enterprise that is competitive with our business, (ii) solicit, divert or take away
the business of our clients, customers or business partners, or (iii) solicit, induce or attempt to induce any employee or independent
contractor to terminate his or her employment or engagement with us. The employment agreements also contain other customary terms
and provisions.

We have also entered
into indemnification agreements with each of our executive officers and directors. Under these agreements, we have agreed to indemnify
our directors and executive officers against certain liabilities and expenses incurred by such persons in connection with claims
made by reason of their being a director or officer of our company.

We have also entered
into director agreements with each of our directors which agreements set forth the terms and provisions of their engagement. We
have also agreed to issue ordinary shares to Harry D. Schulman, an independent director, after the consummation of this offering
in accordance with the terms of his director agreement, the form of which is filed as an exhibit to the registration statement
of which this prospectus forms a part.

Board of Directors

Duties of Directors

Under Cayman Islands
law, our board of directors has the powers necessary for managing, and for directing and supervising, our business affairs. The
functions and powers of our board of directors include, among others:

· convening shareholders’ annual and extraordinary general meetings
and reporting its work to shareholders at such meetings;

· declaring dividends and distributions;

· appointing officers and determining the term of office of the
officers;

· exercising the borrowing powers of our company and mortgaging
the property of our company; and

· approving the transfer of shares in our company, including the
registration of such shares in our share register.

Under Cayman Islands
law, all of our directors owe fiduciary duties to our company, including a duty of loyalty, a duty to act honestly and a duty
to act in what they consider in good faith to be in our best interests. Our directors must also exercise their powers only for
a proper purpose. Our directors also have a duty to exercise the skill they actually possess and such care and diligence that
a reasonably prudent person would exercise in comparable circumstances. In fulfilling their duty of care to us, our directors
must ensure compliance with our memorandum and articles of association, as amended from time to time. Our company has the right
to seek damages if a duty owed by any of our directors is breached. You should refer to “Description of Share Capital and
Governing Documents — Comparison of Cayman Islands Corporate Law and U.S. Corporate Law” for additional information
on the standard of corporate governance under Cayman Islands law.

Composition of our Board of Directors

Our board of directors
currently consists of seven directors. Our board of directors has determined that each of Harry D. Schulman, Feng Liu, Zhixiong
Wang and Xuan Li is an “independent director” as defined under the Nasdaq rules. Our board of directors is composed
of a majority of independent directors.

A director is not
required to hold any of our shares to qualify to serve as a director.

Family Relationships

There are no family
relationships between our directors or executive officers.

Committees of our Board of Directors

Our board of directors
has established an audit committee, a compensation committee and a nomination and governance committee, which have the responsibilities
and authority necessary to comply with applicable Nasdaq and SEC rules. The audit committee is comprised of Harry D. Schulman,
Feng Liu and Zhixiong Wang. The compensation committee is comprised of Feng Liu and Zhixiong Wang. The nomination and governance
committee is comprised of Zhixiong Wang and Xuan Li.

Audit Committee

Harry D. Schulman,
Feng Liu and Zhixiong Wang serve as members of the audit committee. Harry D. Schulman serves as the chair of the audit committee.
The audit committee members satisfy the independence requirements of the Nasdaq rules and the independence standards of Rule 10A-3
under the Exchange Act. Our board of directors has determined that Harry D. Schulman possesses accounting or related financial
management experience that qualifies him as an “audit committee financial expert” as defined by the rules and regulations
of the SEC and Nasdaq. The audit committee will oversee our accounting and financial reporting processes and the audits of our
financial statements. The audit committee will be responsible for, among other things:

· appointing the independent auditors and pre-approving all auditing
and non-auditing services permitted to be performed by the independent auditors;
· reviewing with the independent auditors any audit problems or
difficulties and management’s response;

· discussing the annual audited financial statements with management
and the independent auditors;
· reviewing the adequacy and effectiveness of our accounting and
internal control policies and procedures and any steps taken to monitor and control major financial risk exposures;
· reviewing and approving all proposed related party transactions;
· meeting separately and periodically with management and the
independent auditors; and
· monitoring compliance with our code of business conduct and
ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance.

Compensation Committee

Feng Liu and Zhixiong
Wang serve as members of the compensation committee. Feng Liu serves as the chair of the compensation committee. The compensation
committee members satisfy the independence requirements of the Nasdaq rules and the independence standards of Rule 10A-3 under
the Exchange Act. The compensation committee will assist our board of directors in reviewing and approving the compensation structure,
including all forms of compensation, relating to our directors and executive officers. Our chief executive officer shall not be
present during voting or deliberations regarding his or her compensation. The compensation committee will be responsible for,
among other things:

· reviewing and making recommendations to our board of directors
regarding the salaries and other compensation of our executive officers;

· reviewing and making recommendations to our board of directors
regarding compensation of our directors;

· reviewing and approving, or making recommendations to our board
of directors, regarding, equity incentive plans, compensation plans and similar programs or arrangements; and

· selecting, at its discretion, compensation consultants, legal
counsel and other advisors.

Nomination and Governance Committee

Zhixiong Wang and
Xuan Li serve as members of the nomination and governance committee. Zhixiong Wang serves as the chair of the nomination and governance
committee. The nomination and governance committee members satisfy the independence requirements of the Nasdaq rules and the independence
standards of Rule 10A-3 under the Exchange Act. The nomination and governance committee will assist our board of directors in
selecting individuals qualified to become our directors and in determining the composition of our board of directors and its committees.
The nomination and governance committee will be responsible for, among other things:

· recommending nominees to our board of directors for election
or re-election to our board of directors and for appointment to fill any vacancy on our board of directors;

· reviewing periodically the composition of our board of directors
and its committees;

· recommending directors to serve as members of the committees
of our board of directors;

· reviewing and recommending corporate governance principles applicable
to us; and

· overseeing evaluations of our board of directors, individual
directors and the committees of our board of directors.

The composition of
these committees meets the criteria for independence under, and the functioning of these committees will comply with the applicable
requirements of, the Nasdaq and SEC rules and regulations. We intend to comply with future requirements as they become applicable
to us.

Code of Business Conduct and Ethics

In connection with
this offering, we have adopted a code of business conduct and ethics, which is applicable to all of our directors, executive officers
and employees and is publicly available.

Foreign Private Issuer Exemption

We are a “foreign
private issuer,” as defined by the SEC. As a result, in accordance with the rules and regulations of Nasdaq, we may choose
to comply with home country governance requirements and certain exemptions thereunder rather than complying with Nasdaq corporate
governance standards. We may choose to take advantage of the following exemptions afforded to foreign private issuers:

· Exemption
from filing quarterly reports on Form 10-Q, from filing proxy solicitation materials on Schedule 14A or 14C in connection
with annual or special meetings of shareholders, from providing current reports on Form 8-K disclosing significant events
within four (4) days of their occurrence, and from the disclosure requirements of Regulation FD.

· Exemption
from Section 16 rules regarding sales of ordinary shares by insiders, which will
provide less data in this regard than shareholders of U.S. companies that are subject
to the Exchange Act.

· Exemption
from the Nasdaq rules applicable to domestic issuers requiring disclosure within four
(4) business days of any determination to grant a waiver of the code of business conduct
and ethics to directors and officers. Although we will require board approval of any
such waiver, we may choose not to disclose the waiver in the manner set forth in the
Nasdaq rules, as permitted by the foreign private issuer exemption.

· Exemption
from the requirement that our board of directors have a compensation committee that is
composed entirely of independent directors with a written charter addressing the committee’s
purpose and responsibilities.

· Exemption
from the requirements that director nominees are selected, or recommended for selection
by our board of directors, either by (i) independent directors constituting a majority
of our board of directors’ independent directors in a vote in which only independent
directors participate, or (ii) a committee comprised solely of independent directors,
and that a formal written charter or board resolution, as applicable, addressing the
nominations process is adopted.

Furthermore, Nasdaq
Rule 5615(a)(3) provides that a foreign private issuer, such as us, may rely on our home country corporate governance practices
in lieu of certain of the rules in the Nasdaq Rule 5600 Series and Rule 5250(d), provided that we nevertheless comply with Nasdaq’s
Notification of Noncompliance requirement (Rule 5625), the Voting Rights requirement (Rule 5640) and that we have an audit committee
that satisfies Rule 5605(c)(3), consisting of committee members that meet the independence requirements of Rule 5605(c)(2)(A)(ii).
If we rely on our home country corporate governance practices in lieu of certain of the rules of Nasdaq, our shareholders may
not have the same protections afforded to shareholders of companies that are subject to all of the corporate governance requirements
of Nasdaq. If we choose to do so, we may utilize these exemptions for as long as we continue to qualify as a foreign private issuer.