February 12, 2018 – Hong Kong – Sharing Economy International Inc. (Nasdaq: SEII), a clean technology and sharing economy company that designs, manufactures and distributes of proprietary high and low temperature dyeing and finishing machinery to the textile industry, and is engaged in the development of sharing economy platforms and rental related businesses, today provided the following letter to shareholders:
Dear SEII Shareholders:
I would like to take this opportunity to wish you all a very happy, healthy and prosperous 2018.
Throughout 2017, we made significant changes in the overall direction of the company. Given the headwinds affecting our manufacturing business, we have made the decision to focus on high growth opportunities and have added new sharing economy business units into the group. Our new corporate name, Sharing Economy International Inc., which became effective a few weeks ago, reflects this shift in our strategic direction.
Historically, the company has focused on environmentally friendly solutions, and through the research and development of new sharing economy businesses, we remain true to that heritage.
Sharing Economy Developments
Today, the sharing economy is in the process of disrupting and transforming numerous industries, changing both business and consumer behavior. The sharing economy redefines how resources are being provided and utilizes them in a more efficient way. According to Juniper Research, total sharing economy revenue is predicted to reach $40.2 billion by 2022. PwC UK forecasts the five most prominent sharing economy sectors – collaborative finance, peer-to-peer accommodation, peer-to-peer transportation, on-demand household services and on-demand professional services, could see a 20-fold increase to €570 billion by 2025 in European markets, up from just €28 billion today. The sharing economy is spreading across different industries and regions, creating new market behavior.
Sharing economy business models are hosted through digital platforms that enable more precise, real-time measurement of spare capacity and have the ability to dynamically connect that capacity with those who need it. These digital platforms handle transactions that offer access over ownership through renting, lending, subscribing, reselling, swapping or donating. Consumers who use sharing economy business models are often more comfortable with transactions that involve deeper social interactions than traditional methods of exchange.
In 2017, SEII began studying and acquiring sharing economy platforms in different market disciplines. Following these efforts, we are now grouping our sharing economy markets in the following verticals: coworking and coliving communities, community consumer resource sharing, collaborative transportation, on-demand peer-to-peer services, and social referral recruitment.
Because the sharing economy will be built upon digital platforms to provide precise and real-time services to connect spare capacity with users, we need to apply advanced technologies to support a convenient and safe sharing economy ecosystem and build trust among the participants. SEII has established both in-house engineering teams and engaged with external technology partners and advisors to develop a common underlying information and transaction platform which can be used by different sharing economy vertical applications. Our technical teams and partners include experts in blockchain, artificial intelligence, big data, digital imaging and video technologies, eCommerce and UI/UX, among others. Blockchain is a technology which allows secured decentralized transactions to be possible and provides a digital platform solution for the development of a sharing economy ecosystem. We are working with our partners to develop SEII’s “Sharing Blocks,” a blockchain-based platform which provides functions for secured user profile information and transaction records through a “Blockchain as a Service” (BaaS) model, allowing third-party sharing economy applications to utilize and build a global consolidated and trustworthy sharing economy ecosystem.
The sharing economy is predicated on the trust of all participants. The best way to establish sharing behaviors is within communities. SEII continues to be in active discussions with ECrent Capital Holdings Limited (“ECrent”), a private company incorporated in the British Virgin Islands focusing on developing and operating of a global sharing and rental platform to promote sharing economy across 30 countries and regions, regarding a potential merger and acquisition or business cooperation. On the ECrent platform, users can share and locate items and services within or close to their community using the search, grouping and location services. With the global population of 7 billion individuals embracing sharing communities, we believe ECrent’s sharing community has the potential to provide significant user and revenue growth opportunity to the group.
Coworking and Coliving Development
According to Small Business Labs, the number of coworking spaces globally will exceed 30,000 by 2022, with over 5.1 million people utilizing coworking spaces. SEII is entering the coworking and coliving spaces market through partnerships and affiliations with current coworking and coliving space operators. Our recent acquisition of Anyworkspace, and potential acquisitions of Quikspace, and JoGeep, combined with the development of our item rental services “Rental Stations” within our EC Power subsidiary, will support our coworking and coliving rental community development.
While still in a very early stage, we are also exploring opportunities to invest in integrated coworking and coliving communities through the restructuring of existing hotels, resorts, service apartments and commercial and residential properties. Our aim is to revitalize these types of properties into one-stop coworking and coliving facilities where people can live and work within one building – a true community. People can fulfill their daily needs through short and long term rental models for items and services within the community such as computer equipment, appliances, cars, meeting and party rooms, video rooms, cinema/auditorium and more. All transactions will be processed through a virtual bank facility and through a secured cryptocurrency – Ecoin. We truly believe this has the potential to be a revolutionary property asset and sharing economy project, which can offer attractive property asset investments along with growth potential of the sharing economy. The way people live and work will change.
On-Demand Services and Referral Recruitment
Another area that SEII group is currently exploring is on-demand services and referral recruitment. The ways people work and how services are provided has been changing, and there is a growing need for short-term services and workforces in the market. With our newly completed acquisition of Inspirit Studio, a new sharing platform, Buddigo, will be launched in mid-2018. Buddigo will allow everyone to share their daily trips by providing delivery, pick-up and errand services for a fee. In terms of referral recruitment, we see strong potential here as well. Not only will it reduce the costs of recruitment, it will increase trust and reliability for employers. Users can share their professional networks and act as headhunters for extra income opportunities, while corporations will benefit from lower costs and have more confidence in candidates due to endorsements and references.
Sharing Transportation and Smart City
Transportation is an important part of our daily lives, but it is also one of the major causes of pollution. Sharing transportation can help reduce the unnecessary growth of vehicles. We are working with partners both in technology development and taxi operators to develop a sharing taxi platform that provides passengers with the option to share taxi trips together. Our design will allow users to call a taxi that is already occupied but identified as shareable. Through a location service and route planning system, the best sharing taxi can be suggested to the user. While working with taxi operators to enhance taxi services, we are also planning to build a taxi-based city WiFi network. With taxis as the access points, users can access the network easily, especially travelers arriving at new locations. Further plans include expanding the network access points to other types of public transportation. Establishing a city network will keep us closer to our users, allow us to offer additional services and provide opportunities for monetization through targeted media and advertising in the future.
Going forward, we will focus on these new efforts and opportunities in sharing economy development. We believe further M&A has the potential to grow the company rapidly and aggressively in new market opportunities, technology, products and platforms, and the more importantly– teams and talent. We have strong confidence that these business strategies and expansion plans will provide a long-term future for SEII and build value for our investors.
It was an eventful year in 2017. We want to thank our employees and partners for all their efforts to help establish a new and solid foundation for 2018 and beyond. We look forward to providing you with more frequent shareholder updates as we move forward.
Mr. Jianhua Wu
Chairman and CEO
Sharing Economy International Inc.
About Sharing Economy International Inc.
Sharing Economy International Inc., through its affiliated companies, designs, manufactures and distributes a line of proprietary high and low temperature dyeing and finishing machinery to the textile industry. The Company’s latest business initiatives are focused on targeting the technology and global sharing economy markets, by developing online platforms and rental business partnerships that will drive the global development of sharing through economical rental business models. Moreover, the Company will actively pursue blockchain technology in its existing and to-be-acquired business, enabling the general public to realize the beauty of resource sharing. For more information visit www.seii.com.
Safe Harbor Statement
This release contains certain “forward-looking statements” relating to the business of the Company and its subsidiary and affiliated companies and certain potential transactions that they may enter into. These forward looking statements are often identified by the use of forward looking terminology such as “believes,” “expects” or similar expressions. Such forward looking statements involve known and unknown risks and uncertainties that may cause actual results to be materially different from those described herein as anticipated, believed, estimated or expected. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company’s periodic reports that are filed with the Securities and Exchange Commission and available on its website, including factors described in “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Form 10-K for the year ended December 31, 2016 and in our Form 10-Q for the quarter ended September 30, 2017. All forward-looking statements attributable to the Company or to persons acting on its behalf are expressly qualified in their entirety by these factors other than as required under the securities laws. The Company does not assume a duty to update these forward-looking statements.
Sharing Economy International Inc.
Parkson Yip, COO
Director of Investor Relations