Yuanbao (YB) Registration Filing summary

Company overview and business model

• Operates as a technology-driven online insurance distributor in China, leveraging a proprietary consumer service cycle engine and advanced data analytics to match consumers with insurance products from partnered carriers.

• Utilizes a VIE structure due to PRC restrictions on foreign ownership in certain sectors; business is consolidated for accounting purposes but no direct equity in the VIE.

• Offers both insurance distribution and system services, generating revenue from commissions and technical services to insurance carriers.

• Focuses on short-term medical, critical illness, and life insurance products, with a growing consumer base in underdeveloped regions.

Financial performance and metrics

• Revenue grew 140.5% from RMB850.3 million in 2022 to RMB2,045.2 million (US$281.4 million) in 2023; 58.7% increase to RMB1,529.0 million (US$210.4 million) in the first half of 2024.

• Achieved profitability in 2023 with net income from continuing operations of RMB205.2 million (US$28.2 million); net income of RMB328.7 million (US$45.2 million) in the first half of 2024.

• Operating cash flow was RMB55.1 million in 2022, RMB426.6 million in 2023, and RMB581.6 million in the first half of 2024.

• Key operating metrics: 8.1 million insurance consumers and 12.5 million new policies in 2023; first year premiums of RMB17.6 billion.

Use of proceeds and capital allocation

• Net proceeds will be allocated: 40% to enhance the consumer service cycle engine, 30% to invest in core technology and data insights, 20% to extend consumer reach and geographic coverage, and 10% for working capital and general corporate purposes.

• Proceeds may be used for loans or capital contributions to PRC subsidiaries, subject to regulatory approvals.