ツクルバ（2978） – [Delayed]Financial Results Q2 Fiscal Year 2021

T S E M o t h e r s : 2 9 7 8F i n a n c i a l R e s u l t sF Y 2 0 2 1 Q 2 ( N o v . – J a n . )M a r . 1 5 t h 2 0 2 2FY 2021Aug. 1 st 2021 to July 31 st 2022Agenda1．Financial Highlights for FY2021 Q22．Financial Results for FY2021 Q23．Forecast for FY20214．Reference© 2022 TSUKURUBA Inc.11. Financial Highlights for FY2021 Q2 © 2022 TSUKURUBA Inc.2HighlightsFinancial Results FY2021 Q2(Nov. 2021-Jan. 2022)• Continued growth with record revenue and gross profitRevenueJPY 653 million (+68% YoY)Gross ProfitJPY 419 million (+44% YoY)• Steady progress in cowcamo business in line with our goals for FY 2021GMVJPY 8,810 million (+62% YoY)Take Rate4.4 % (-0.5 pts YoY, +0.5 pts QoQ)Forecast forFY2021(Aug. 2021-Jul. 2022)• In light of the recent macro environment changes, we will review costs, focusing on fixed cost reductions, and plan to reduce next fiscal year’s deficit (see page 20)• At this time, we maintain our full-year forecast for FY2021 ending July 31, 2022.© 2022 TSUKURUBA Inc.32. Financial Results for FY 2021 Q2© 2022 TSUKURUBA Inc.4Companywide ｜ FY2021 Q2 – Quarterly Financial SummaryRevenue and gross profit reached a record high, and steady progress in investments are seen, in line with our plans(Unit: JPY million)FY2022 Q2(2021/11-2022/1)FY2021 Q2(2020/11-2021/1)YoYFY2022 H1(2021/8-2022/1)FY2021 H1(2020/8-2021/1)YoYRevenueGross Profit653419389+68%1,219760+60%290+44%768593+30%Operating Profit-251-496-118Ordinary Profit -253-506-112Net Profit-253-506-119-72-67-66——© 2022 TSUKURUBA Inc.5Companywide ｜ Progress towards our full-year forecast for FY2021Considering the seasonality factor and growth potential in the second half of FY2021, the first half has progressed as planned. The assumptions underlying our forecast are discussed on page 22. H1768(Rate of progress: 43%)進捗率: 72.8 %(Unit: JPY million)FY20212022年7月期Q1353 349Q2419 419Forecast1,780)lautca( tiforPssorG0%10%20%30%40%50%60%70%80%90%100%© 2022 TSUKURUBA Inc.6Companywide ｜Revenue and Gross ProfitRevenue and gross profit reached record highs.Revenue(Unit: JPY million)+68% YoYGross Profit(Unit: JPY million)+44% YoY700.0600.0500.0400.0200.0100.00.0653 450.0419 539 565 486 453 429 443 421 374 389 376 371 366 358 326 363 290 349 302 307 282 258 257 211 300.0One-timelarge transaction289 282 167 142 121 99 192 150 91 99 97 400.0350.0300.0250.0200.0150.0100.050.00.0Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2FY17FY18FY19FY20FY21FY17FY18FY19FY20FY21© 2022 TSUKURUBA Inc.7Segments ｜ FY 2021 Q2 – Financial Highlights by Business SegmentGross profit in cowcamo, our mainstay business, has been steady. Revenue increased due to purchases of in-house products.（Unit: JPY million)FY2021 Q2FY2020 Q2YoYFY2021 H1FY2020 H1YoYRevenue305+82%1,032581+78%cowcamoGross Profit268+44%544+32%BusinessSegment Profit-131-59-Revenue+17%186179+4%716-234PPDGross ProfitBusinessSegment Profit+46%+4,011%529482+8%+345%OthersCorporateExpenses-131-80–271-179-554387983111784210© 2022 TSUKURUBA Inc.8cowcamo ｜ KPIs for cowcamoFor better disclosure and understanding, we have changed the KPIs of cowcamo to the GMV and Take Rate. We will also continue to disclose the number of transactions and MAU as reference.Financial KPIGross ProfitGross Profit from cowcamoGMV*1Take RateBusiness KPIsGross Merchandise Valueon the platformGross Profit/GMVFor ReferenceNo. of transactions*1No. of transactionson cowcamoMAUMonthly Active Users of cowcamoGMV: Gross Merchandise Value is total circulation on the platform. GMV is the sum of the prices of all products and services traded on the cowcamo platform, including properties and renovation services.Take Rate: The commission rate charged under GMV, calculated by dividing the gross profit of cowcamo by GMV.*1 Calculated on a contract basis© 2022 TSUKURUBA Inc.9cowcamo ｜ Gross ProfitGross profit reached a record high, +44% YoY.(Unit: JPY million)+44% YoY450.0400.0350.0300.0250.0200.0150.0100.050.00.0344 327 268 282 234 175 268 276 227 275 176 387 331 328 79 87 110 84 Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2FY17FY18FY19FY20FY21© 2022 TSUKURUBA Inc.10cowcamo ｜ GMV・Take RateGMV remains high due to steady growth in services. Although the Take Rate remains low due to the lower number of condominiums in the market, the Take Rate has shown gradual improvement through the expansion of in-house products and a growing sales force (see p.14) We expect the Take Rate to improve over the medium to long term (see p.33)GMVTake Rate(Unit: JPY million)8,867 8,810 8,370 7,886 6,095 5,801 5,350 6,436 5,429 4,442 4,682 4,386 4,045 2,638 6.6%6.0% 5.9%6.1%5.3%4.4%5.2%4.9%4.4% 4.3%4.4%4.2%3.9%3.1%Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2FY18FY19FY20FY21FY18FY19FY20FY21© 2022 TSUKURUBA Inc.11For Reference ｜ Quarterly Financial and Business KPI(Unit: JPY million）FY18FY19FY20FY211Q421192175172441371491-522Q289258234242441481481133Q374282268142321401081494Q429326282443181891811071Q4533663442234120317120242Q5393583273034619314138113Q4432572273032719616114-694Q28221117634328198151141Q3713022752634822324992Q3892902682136326121803Q37630727630426298191074Q48636333132485335251241Q56534932820594432221392Q6534193873167051820131-117-45-72-118-121-244-2512,6384,4426,0954,6825,8015,3504,3864,0456,4365,4298,8677,8868,3708,810Take Rate (％)No. of transactions*1MAU*2（K）6.659255.398274.4119286.0105295.9123366.1121405.295444.493504.3130544.9118593.1166624.2159593.9180644.417957© 2022 TSUKURUBA Inc.12Operating ExpenseRevenueGross ProfitcowcamoPPDcowcamoPPDOtherOperating ProfitBusiness KPIGMV*1*1 – based on contracts*2 – Quarterly average registered MAUcowcamo ｜ Business conditions related to KPIs for FY2021 Q2In Q2, the GMV and Take Rate were solid due to steady growth in services and business on the seller’s side. Our full-year forecast forFY2021 for both the GMV and Take Rate remain unchanged*Results for FY2021 Q2Major developments in FY2021 Q2• A sudden shift in supply and demand caused by COVID-19 has subsided, and we expect continued growth in demand.GMVJPY 8,810 million+62% YoY•In addition with steady growth in existing services, especially for buyers, the development of the private seller channel contributed to our growth. The number of transactions reached 179 (+52% YoY), a high level for two consecutive quarters.• Steady progress was made in expanding the sales force, cultivating the private seller channel, and expanding in-house products. Full-year GMV growth forecast is in line with our forecast for FY2021.tiforPssorGTake Rate4.4％-0.5 pts YoY＋0.5 pts QoQ• With the rise in inventory for the second consecutive quarter, the pressure to lower commission rates caused by the external environment is gradually subsiding.• The Take Rate recovered to levels seen in the first half of FY2020, with steady improvement due to higher supply of our in-house products and a higher ratio of in-house agents.• Progress is being made on measures to structurally improve the Take Rate which is expected to remain steady from the second half of the year. * Full-year forecast for cowcamo: Expected YoY growth of about 30% in GMV and 10% in the Take Rate (see p.22)© 2022 TSUKURUBA Inc. 13cowcamo ｜ Major initiatives for FY2021 Q2For FY2021 Q2, based on our stated goals at the beginning of FY2021, we have been implementing various measures for sellers and buyers that contribute to improving the GMV and Take Rate.For sellersFor buyersDevelopment of individual seller channelsContinued improvement of services and products for buyersGMVDevelopment of services for individual sellersDExpansion of sales force for buyers(increase in the number of in-house agents)ABCtiforPssorGExpansion of supply of in-house productsPromotion of OMO* measures for buyersTake RateContinued support for flippersOMO: Online Merges with Offline. A customer-oriented approach to integrating online and offline to create a better customer experience.© 2022 TSUKURUBA Inc. 14cowcamo ｜ A. Development of individual seller channelsIn line with our goals stated at the beginning of FY2021, we have expanded the private seller channel. As a result, the number of appraisal requests from individual sellers and brokerage contracts, both key leading indicators, increased. We expect increased property sales for individual sellers to contribute to GMV for the full year.Attracting customersBrokerage contractSaleStatusPromoted the PDCA cycle centered on improve-Steadily increased the number of brokerage ment of our website and optimization of digital contracts with individual sellers by reinforcing advertising, resulting in steady growth in the the sales force and processes in conjunction number of appraisal requests.with the expansion of customer acquisition.Currently working to boost sales of acquired propertiesAppraisal requests from individual sellers*No. of brokerage contracts with individual sellers+193% YoY100+163% YoYResult ofleadingindicators300250200150100500806040200(GMV is expected to improve due to the sale of properties)FY20 Q2FY21 Q2FY20 Q2FY21 Q2*The total number of appraisal requests from individual sellers through cowcamo website or partner companies. In accordance with in-house standards, 20% of the actual number of appraisal requests is used to convert the number of appraisal requests by customers sent from partner companies.© 2022 TSUKURUBA Inc. 15cowcamo ｜ B. Development of services for individual sellersurucamo, the first matching platform for pre-sale, used real estate in Japan, was launched in February 2022. We expect the service to contribute to GMV expansion and structural Take Rate improvement through higher actual sales transactions (The impact of urucamo has not been factored into our earnings forecast for FY2021.)Service overview Business impactintent tobuy or selltransactionspostreactionProspectivesellersurucamoProspectivebuyersappraisalFast pass for private viewingconsultationprivate viewingContract• Aim to build a new property sales service in line with the sense of • This is part of our business expansion for sellers. We expect an values held by today’s potential sellers• Matching platform for those with the “intent to sell or buy” where prospective sellers can easily post their property information and receive feedback from prospective buyers.• After matching those with the intent to sell and buy, a smooth transition to the actual transaction is made with the full support of Tsukuruba’s agents.increase in actual sales transactions originating from urucamo, which will contribute to GMV expansion (not factored into the earnings forecast of FY2021)•In the mid-term, urucamo will contribute to the improvement in the structural Take Rate through end-to-end* integration of the distribution process, together with cowcamo service.• urucamo will contribute to “the formation of a new market with a high degree of liquidity.”* End-to-end: refers to the entire distribution process between the individual seller and the individual buyer. With urucamo, individual sellers can sense the intentions of individual buyers, and through cowcamo, they can conduct the actual transaction. Compared to the conventional multi-stage distribution structure, this will bring us closer to a distribution structure that connects individuals on both sides of the process more directly. This will also contribute to the improvement of our Take Rate by increasing the value of our company’s intervention.© 2022 TSUKURUBA Inc. 16cowcamo ｜ C. Higher supply of self-designed propertiesIn line with our goals, we have increased the supply of our own planned products. In FY2021 H1, the number of such properties on sale increased by 267%*1 compared to the same period last year. We expect to see a steady increase in supply, as well as a contribution to the GMV and Take Rate*2 for the full year through the closing of property transactions.Change in the number of our planned products(No. of properties on sale)+267% YoYProperties purchased and plannedby TSUKURUBA• Expanded gradually on a trial basis from the end of FY2020• For the time being, limited to transactions where risk control is possible; in the medium-to long-term, we aim to create a scalable structure through off-balancing, etc.Planned properties in cooperation with flipping companies•In line with our goal at the beginning of FY2021, promote the growing supply of properties designed by Tsuruba• Working to stabilize supply, including better planning and sales capabilities based on customer needs33上期FY21 H1FY229上期FY20 H1FY21*1 “on sale” refers to when a property is released on cowcamo after procurement, planning, and development. In general, it takes 2-3 months from purchase to start of sale, and 4-5 months from start of sale to settlement (recording of sale)*2 Properties purchased and sold by Tsukuruba will make an additional contribution to revenue. © 2022 TSUKURUBA Inc. 17cowcamo ｜ D. Expansion of sales force dedicated to buyers Steady progress was made in expanding the sales force throughout the first half. The number of in-house agents* at the end of the second quarter was up 76% and the number of working agents also increased 30% from the same period last year. We expect this to contribute to GMV through higher transactions.Change in the number of in-house agentsNo. of agents in trainingNo. of working agents6050403020100+76% YoY+30% YoYContribute to GMV growth through higher transactions by putting them to work in the future.The higher number of working agents has begun to contribute to GMV growth through higher transactions.Q1Q2Q3Q4Q1Q2FY20FY21FY21FY22* The term “in-house agent” refers to an individual engaged in brokerage sales who is employed by TSUKURUBA. The number of agents on this page reflects those engaged in brokerage sales for buyers.© 2022 TSUKURUBA Inc. 183．Forecast for FY2021© 2022 TSUKURUBA Inc. 19The Macroeconomic Environment and Tsukuruba’s GoalsAlthough the impact of recent changes in the macroeconomic environment has been limited, we will review our costs, focusing on controlling fixed costs, and plan to reduce our losses in the next fiscal year.Change in the macro environment• Tighter monetary policy and deteriorating sentiment in the capital markets due to concerns over inflation, especially in the US, are expected. Japan has seen continued low inflation, and an immediate change in interest rates is unlikely. However, we will keep a close eye on the indirect effects on the domestic economy.• Assumed changes in the economic environment due to the war in Ukraine, including a sharp rise in global commodity prices, the impact on supply chains, and lower demand due to falling consumer confidence.Impact on the real estate market: Real estate prices are expected to fall when interest rates rise, and construction prices are expected to rise when material prices soar. However, actual demand for real estate is expected to remain ••stable over the long term.Impact on our business environmentImpact on the home distribution business: This impact on real estate is expected to have a relatively large impact on new condominium market. In our main business domain, or the used condo distribution business, we expect demand substitution from the new condo market. In addition, the “flipping” business model will incur more risk as real estate prices decline, and therefore, we will need to control inventory risk.•Impact on the financial environment: We recognize the need for more prudent financial management in light of the uncertain macro environment and declining procurement environment.Management Goals and Forecastfocusing on controlling fixed costs.• Management Goals: Although the direct impact on our business will be limited at this time, we will closely monitor the impact on our financial environment. We plan to reduce our losses in the next fiscal year by reviewing costs, • Forecast for FY2021: As mentioned above, we will continue to review costs through the second half of the year. However, at this time, the full-year forecast for FY2021 remains unchanged.© 2022 TSUKURUBA Inc. 20Reference ｜Impact of the macro environment on the used real estate marketCompared to the supply of new condos, the number of transactions for used condos has shown a continuous increase without being significantly affected by the economic environment. We assume that growth will continue over the mid- to long-term as existing condominiums accumulate as stock.Change in the number of new and used condos in circulation in the Tokyo metropolitan areasales tax increasethe financial crisisGreat East Japan Earthquakesales tax increasesales tax increase（No. of transaction）140,000120,000100,00080,00060,00040,00020,0000The resilient used property market -background• Actual demand for housing is less affected by the economic environment as it is generated by changes in various life stages such as childbirth, transfers and inheritance amongst families.• New condos are a “flow” supply and are strongly affected by the economic environment through changes in land price and material supply, while used condos are supplied from accumulated “stock” and function as a substitute for new condos even as the macro environment changes.• Therefore, even as macroeconomic changes described on the previous page become apparent, stable growth of the used condo market is expected to continue.60%50%40%30%20%10%0%299139914991599169917991899199910002100220023002400250026002700280029002010211022102310241025102610271028102910202021202No. of transactions for 中古マンション成約数used condosSupply of new 新築供給戸数condosRatio of used 中古率condosSource: Real Estate Information Network for East Japan “Trends in the Metropolitan Area Real Estate Distribution Market”, Real Estate Economic Institute Co. © 2022 TSUKURUBA Inc. 21FY 2021 Forecast – key assumptions (updated)In accordance with our management goals, we have updated our assumptions and have reviewed our costs, focusing on controlling fixed costs. We maintain our forecast for FY2021: net sales of JPY 2,450 million, gross profit of JPY 1,780 million, and an operating loss of JPY 890 million.Key assumptions (as of Sep. 13, 2021)Updates since Sep. 13, 2021Market: The sudden change in the business environment caused Market: In addition to the left, watch for the impact of sudden by COVID-19 has subsided. We expect continued growth in demand.changes in the macroeconomic environment on both supply and GMV: We expect approx. 30% growth YoY due to an increase in the demand (though any impact on this fiscal year’s performance is number of customers, expansion of the sales force and services, expected to be limited)cowcamoand higher property supply.GMV: No change in assumptionsTake Rate: Expected to rise by approx. 10% YoY by expanding Take rate: No change in assumptionsprivate brand products and increasing the ratio of in-house agentsExpenses: Partial review of upfront investments (mainly recruiting, Cost: Incorporate upfront investments for continued growth in personnel and outsourcing expenses) in the second half of FY2021, gross profitwith a focus on investments for the mid- to long-term• We have not taken into account major changes in both gross • No change in assumptionsPPDprofit and SG&A expenses as we prioritize the growth of cowcamo.• We will continue to provide logistical support for cowcamo and conduct business trials for the medium to long term.Expenses••Incorporate expenses for recruitment, personnel and stock-based • Curbed hiring and personnel expenses in the second half of compensation (reinforcement of organization for continued growth)FY2021, as a certain level of reinforcement of the organization Impact of a new service with Money Forward has yet to be seen. Only costs are considered into the forecast (Medium-term growth was completed in the first half of FY2021.Othersinvestment)• No change in assumptions• Pending large-scale transactions, extreme market fluctuations, new businesses and M&A are not taken into account.* Note: ( ) in the above corresponds to each item in “Upfront investments in SG&A expenses” on slide 23.© 2022 TSUKURUBA Inc. 22Companywide ｜ Progress in upfront investments in FY2021 H1Upfront investments were made throughout the first half of FY2021 as initially planned. In accordance with our management goals, we will review some investments, focusing on curbing fixed costs.Upfront investment of SG&A expensesActual upfront investment in FY2021 H1cowcamoPPDCorporate Expense（Unit: JPY million）Medium-term investment for growthItemActual(Forecast for FY2021)CommentsUpfront investments expected to be recovered in FY2022Mid-term investment for growth(recovery expected in about 3 years)JPY 225 million(JPY 370-470 million)Personnel and costs related to the development of services and products for buyers, and personnel and advertising costs related to the development of business for sellersomacwocetaroproCesnepxEUpfront investments expected to be recovered in FY2022JPY 120 million(JPY 180-230 million)Expenses related to offices and personnel costs associated with the expansion of customer service offices and the sales force (mainly for buyers) and advertising expenses to acquire customersReinforcing the organization for continued growthJPY 90 million(JPY 190-220 million)Mainly recruitment and personnel expenses for executives, managers, and stock-based compensation expensesReinforcing the organization for continued growth1,26522512090FY22.上期FY22 H1FY22(E)FY22 (est.)© 2022 TSUKURUBA Inc.234. Reference© 2022 TSUKURUBA Inc. 24Tsukuruba – a technology company specializing in residential real estateTSUKURUBA is a technology company in the residential real estate business. It operates two business segments: 1) the cowcamo business, a distribution platform for used and renovated properties, and 2) property planning and design (PPD), which collaborates with other companies to create the next core pillar of our business.cowcamoProperty Planning & Design (PPD)We work on the innovation of the housing redistribution structure by planning, developing and running “cowcamo”, our end-to-end real estate brokerage platform for used and renovated properties.We create new businesses by using our accumulated expertise cultivated in our spatial design and consulting business, and our own shared workplace business, and by actively collaborating with external partners.© 2022 TSUKURUBA Inc. 25A management team with background in technology, business and designTSUKURUBA is managed by members experienced in technology with a wealth of knowledge in design to create added value in real estate.Hiroki MurakamiCEOFormerly involved with the development and management of Lifull Home’s, Japan’s no.1 portal site for real estate and housing. Founded Tsukuruba in August 2011 with Masahiro Nakamura. Graduate of Rikkyo University.Shin TakeuchiExternal DirectorStarted his career at Fujisoft and became a freelancer in March 2007. Served as Director of BizReach and serves as Director of the Japan CTO Association. Appointed as Director and CTO of Visional since Feb. 2020. Keiko HattoriAuditor (Full-time)Japan and Delaware CPA. Worked at Mizuho Bank, JP Morgan, BNP Paribas, Ernst & Young ShinNihonand later started her own accounting firm. Joined Tsukuruba as an auditor in 2016.Hiroshi KitaharaCOOPhD in engineering from the Tokyo Institute of Technology, and an MBA from Université Paris-Dauphine. Worked at Corporate Directions, Deloitte Tohmatsu Consulting and Deloitte Consulting Southeast Asia. Joined Tsukuruba in 2016 and was appointed COO in 2018. Hidekazu SuzukiExternal DirectorWorked at Daiwa Securities, conducting advisory services for internal control systems to deal with assessments by the TSE, as well as valuation and fundraising. Joined Atrae in Dec. 2018 as CFO.Shinichi TakanoAuditorServed as an Executive Officer at Cosmos Initia before working for Recruit. In 2010, appointed as Executive Director at Nihon Kotsu after serving as an Executive Director and General Manager at Gyosei. Appointed as External Director of Tsukuruba in 2015.Masahiro NakamuraDirector and Co-founderOne of Nikkei Architecture’s “100 Next Generation Innovators”. Founded Tsukuruba in August 2011 with Hiroki Murakami after working in design studios. Received a MA in architecture and building engineering from the Tokyo Institute of Technology.Yoshinori FukushimaExternal DirectorFounded Gunosy in 2012 which was listed on TSE Mothers in just 2.5 years, followed by a promotion to the TSE 1st Section. Became CEO of Layer X in 2018. Selected as one of Forbes Asia’s 30 under 30 category.Keiko HatanoExternal AuditorAttorney at Mori Law Office since 2008. A member of the JFBA Housing Dispute Settlement Agency Examination Committee and a Corporate Compliance Committee Advisor. Appointed Auditor of Star Festival. © 2022 TSUKURUBA Inc. 26cowcamo ｜ Social issues addressed by cowcamoBy providing user-oriented real estate services and improving the efficiency of the distribution process based on accumulated data, we seek to reduce distribution structure friction and to optimize the matching of supply and demand, thereby creating a new market that is free and highly liquid. Through these activities, we seek to solve a key social issue through the redistribution of accumulated high-quality housing stock.Issues with the existing distribution system• High level of exploitation due to the involvement of too many intermediaries•Inefficient distribution process due to lack of IT• Difficulty in incorporating the value of renovation and qualitative utility into property prices.• An operator-oriented industrial structure makes it difficult to supply products and services that meet user needs.Automationof planning andconstruction Improving the efficiency of distribution processesPricing based on unique renovationassessmentPromotion of change ofresidenceOptimal matching of supply anddemandFinance for real estate distributionFrictionless distribution structureCreate a new, free and liquid marketUser-oriented real estate servicesUnique distribution dataLifetime management of housing history© 2022 TSUKURUBA Inc. 27cowcamo ｜ Strong potential in the Tokyo Metropolitan Areacowcamo, a marketplace-type platform that mediates between sellers and buyers, targets the used home and renovation market. Currently, we are focusing on the Tokyo metropolitan area, but there is strong potential nationwide.Japan nationwide(Long-term government goal)JPY 20 trillion*4Tokyo metropolitan area*3JPY 5.6 trillion (2020)*2Condominiums over 40㎡Tokyo metropolitan area*3JPY 2.2 trillion (2020)*220+ year-old condominiums over 40㎡Pre and post purchase renovationTokyoJPY 1.4 trillion (2020)*220+ year-old condominiums over 40㎡Pre and post purchase renovationcowcamo’s share in Tokyo*1approx. ２％ tekraMgndnapxEiTokyo metropolitan areaJPY 5.6 trillionTokyometropolitan areaJPY 2.2 trillionTokyoJPY 1.4 trillion*1 Calculated by dividing cowcamo’s FY21 GMV by the estimated 2020 market size of existing condominiums in Tokyo that are 20 years old or older, over 40 m2 , and renovated in pre and post purchase.*2 Estimated by TSUKURUBA based on East Japan Real Estate Information Network’s “Annual Report Market Watch FY2020”, Real Estate Information Center’s “2019 Real Estate Industry Statistics (March revision) 3 Real Estate Distribution“, and “Used House Renovation Market Data Book” by Reform Sangyo Shimbun.*3 The Tokyo Metropolitan Area includes Tokyo, Saitama, Chiba and Kanagawa prefectures.*4 Ministry of Land, Infrastructure, Transport and Tourism, “Basic Plan for Housing and Living” (March 9, 2021), total of existing home distribution market and renovation marketNote: The above is an image and does not necessarily accurately represent the difference in values by area ratio.© 2022 TSUKURUBA Inc. 28cowcamo｜Structural changes in the market due to the expansion of used housingBy 2025, homes “over 25 years old” will account for half of the market, and renovated homes are expected to become a common choice.Properties that are 25+ years old will take up half of the marketRenovation will become a mainstream optionThe share of such properties will increase from 22% to 50% by 2025A number of changes are expected as renovation becomes mainstream in the Tokyo metropolitan areaShare of used condos in the Tokyo metropolitan area by age (2005-2025)PurchasedSupplyEvolution of a renovated condo market Fairer pricing of renovated properties Buying renovated condos to suit lifestyles and preferences, and for their priceDiversification of types of used condos Condos to be renovated Renovated condos Renovated condos with additional renovation32%32%50%Changes in the used property businesses Increase in the number of flippers and resale brokers Growth of services, specific for renovated condos~15 ~15年years old15~25 15年~25年years old25年~25~ years old22%2005Source: Above graph was created using data provided by Real Estate Information Network for East Japan201520152025© 2022 TSUKURUBA Inc. 29cowcamoPromoting growth of the real estate brokerage platform for used and renovated propertiescowcamo’s business model is based on a virtuous cycle: as the number of buyers increases, transactions increase, the incentive for sellers to participate increases, and the number of properties that buyers want increases. Leveraging our existing buyer user base, we will boost measures to attract sellers and expand our supply.Suppliers (Sellers)increaseData-driven supportConsistent UX based on dataUsers (Buyers)increaseMore homes based on user preferencesCarefully select listed properties using dataAccumulated business assets(Users, data and knowhow)Effectively match users with properties using dataAppealing marketplace© 2022 TSUKURUBA Inc. 30cowcamo ｜ Business modelcowcamo is a marketplace-type platform that mediates between sellers and buyers of used and renovated housing. By using accumulated data of buyers’ preferences and spatial data, and by intervening in the distribution of properties supplied by sellers, cowcamo provides unique value to both sellers and buyers and builds a growth cycle of property transactions.Proposals for sale and renovation based on our needs dataAccumulation of needs data“Sell quickly at a fair price”“Easy access to good properties”SellersValueFeeA marketplace that connects Marketplace that connects both sellers and buyerssides of the selling/buyingBased on a cumulative total of over Based on a cumulative total of over 11,000 11,000 listed propertiesproperties listedAccumulation of unique data on Accumulation of unique data on used home distributionused home distribution• Customer preference data• Customer preference data• Trading data• Trading data• Space/planning data• Space/planning dataValueFeeVast user base accumulated through sophisticated UXcowcamousersSupply properties based on user needsAppeal through attractive property ads and articles and sell at a fair price© 2022 TSUKURUBA Inc. 31cowcamo ｜ FY2021 Business policy for the growth of gross profitIn order to achieve high growth in gross profit, we will work to improve GMV and Take Rate from both the seller and buyer sides. In FY2021, we will focus on increasing the supply of properties and improving Take Rate structurally through development of business for sellers.For SellersFor BuyerstiforPssorGExpansion of property supply by building business Promote user acquisition, improve CX, and for sellers (A)expand scale of operations as beforeGMV• Develop individual seller channel• Expand supply by strengthening cooperation with • Continue to grow user base• Continuously improve services and productsflipping companies• Continue to develop new services for sellers through the alliance with Money Forward• Expansion of operation area•Improve CX at OMO* (customer service locations, seminars, etc.)Promotion of structural Take Rate improvement (B)• Expansion of support services for flipping companies (increase in planning fees, etc.)• Expansion of private brand properties (acquisition of added value related to the development and Take Rateplanning)• Trial of additional services for sellers• Expansion of additional services for buyers (up-selling to buyers)• Expansion of sales force (increase in ratio of in-house agents due to improved outlook for COVID-19)OMO: Abbreviation for Online Merges with Offline. It is a customer-oriented concept that integrates online and offline to create a better customer experience.© 2022 TSUKURUBA Inc. 32cowcamo ｜ Improving the structural Take Ratecowcamo has been developing its business by focusing on brokerage fees received from intermediaries between flipping companies and individual buyers. From FY2021, we plan to reinforce our business for sellers, and through expansion, we will structurally improve the Take Rate of cowcamo in the distribution process between sellers and buyers.Value-added structure in the distribution process of used properties(Figures in parentheses indicate the Take Rate)Service for sellers(～3%)Renovation andflipping service(approx. 10%)Servicefor buyers(～3%)Brokerage services for sellers(3～6%)Brokerage services(Implemented as a secondary business)Brokerage services for buyers(3～6%)Brokerage of renovated propertiesSupport service for flippersImprovement of in-house agents ratioAncillary services for buyersMain business areas from the pastVerified/expansion phaseomacwocnoetaRekaTehtgnivorpmIDevelopment phase with upfront investmentAncillary services for sellersBrokerage services(strategically implemented)Expansion of private brand properties by Tsukuruba or through an alliance with flippersScope of “business development for sellers” to be reinforced from FY2021Vision for the futureFinancial services, etc. for sellersFinancial services, etc. for buyers© 2022 TSUKURUBA Inc.33cowcamo ｜ Competitive environmentBy integrating its real estate portal site with its brokerage business, cowcamo has built a unique position based on a “fun-to-view customer experience” and “fast and appropriate matching” based on accumulated users and data.Housing and condominium developersReal-estate portal siteLarge conglomerate-affiliated realtors,small and medium-sized realtorsFlippers (resale realtors)srelleS“Renovation + real estate brokerage” companiesResale property investorssreyuBsrotsevnI© 2022 TSUKURUBA Inc. 34cowcamo ｜ KPI’sFinancialKPIBusinessKPIThe KPI’s for cowcamo’s business is as follows. From FY2021, we have set Gross Profit as the financial KPI, and GMV and Take Rate as the business KPI. We will continue to work to maximize Gross Profit by expanding GMV and improving the Take Rate.Gross ProfitGMV*1Take RateReference indicatorsNo. of transactions*1MAUMAU CVRAveragePurchasePriceGMV: Gross Merchandise Value refers to total circulation on the platform. GMV is the sum of the prices of all products and services traded on the cowcamo platform, including properties and renovation services.Take Rate: The commission rate charged for GMV, calculated by dividing the gross profit of cowcamo by GMV.MAU: Monthly Active Users*1 calculated based on contracts© 2022 TSUKURUBA Inc. 35Topics ｜ The number of registered cowcamo members exceeded 300,000 in Sept. 2021The number of registered cowcamo members exceeded 300,000 in Sept. 2021. The number of platform users surpassed 2 million* in the past year. We are steadily growing as a platform.Accumulating users and dataDistribution of customerscowcamo users• cowcamo was launched in June 2015 and has grown 1.5 times in a year after surpassing 200,000 registered members in September of last year.• The service has grown to include one out of every six people considering buying a used home in the Tokyo metropolitan area and parts of Yokohama, where it mainly posts information.* Including customers who browse for information without registering as a member (actual results for August 1, 2020 to July 31, 2021)Percentage of customers who renovate their own homesPartial & fullrenovation* Survey of people who bought homes through cowcamo in the second half of FY20203930%%61%No renovationby customers© 2022 TSUKURUBA Inc.36cowcamo ｜ Effective sales and property creation using our user databaseAs shown in the previous slide, cowcamo employs user data to provide sellers with the value of “selling quickly at a fair price” and buyers with the value of “getting a good deal with ease. As a result, we have achieved the following:Selling quickly at a fair priceCreate properties that meet user needsSold at desired price*185 %Reference: Of the properties in the Tokyo metropolitan area sold within 3 months, 20% sold at the listing price, and those which had price reductions of 5% or less were 37% of total*2.Listing period• Contracts closed in an average of 2.03 months*3compared to the average of 4.15 months*2 in the Tokyo metropolitan area*2• Compared to the average of 55%,*2 79% of listings sold within 3 months41%28%10%21%250.0200.0150.0100.050.00.0• The key is “the number of attractive properties that match user needs.”• “The number of attractive properties that match user needs” ≒ “the number of properties receiving many requests for viewing” is steadily increasing.The number of properties that meet the number of requests for viewing required for completing a sale within two weeks*5(The index is calculated using FY2019 as 100)218 122 100 ~1 month1~2months2~3 months more than 3 months*1 The percentage of contracts concluded at “the upper limit of a challenging price range” or “the price range at which inquiries were received”.*2 The Tokyo metropolitan area average: https://www.kantei.ne.jp/report/108kairi_shuto.pdf (Tokyo Kantei, July 29, 2021) *3 cowcamo average: The average number of days during FY2020 in which cowcamo acted as intermediary for contracted properties and published articles. *4 Distribution of the number of days it took from mediation to contract signing for FY2020. *5 Number of properties that received 9 or more inquiries within two weeks. 9 was the median number of inquiries received before a property was sold.FY2018FY2019FY2020© 2022 TSUKURUBA Inc. 37cowcamo ｜ Happy customersHere are some examples of what users say about cowcamo. By providing not only quantitative but also qualitative information including the surrounding area, we are able to support our customers to transact quickly at a fair price.Sellers’ FeedbackBuyers’ Feedback A broker we dealt with told us that our price was too high, and I only received one private viewing through them. …but after an article was published on cowcamo, we received private viewings one after another. Within a week, we were able to finalize a deal with the current owner. The broker above was surprised by this. We enjoyed viewing the wonderful properties listed on cowcamo, along with a wealth of photos and information. The app was easy to use, and the chat function was convenient. I was able to easily create a renovation plan that suited my needs.© 2022 TSUKURUBA Inc. 38cowcamo｜Long-term goal of improving QOL & leading the Used Property MarketIn the long term, cowcamo will promote residential upgrades in accordance with lifestyles through the evaluation of home renovations, thereby contributing to the improvement in QOL (quality of life), and through expansion of the used property market.Increase Home PricesIncrease frequency of home purchases= Expand TAM• Fair valuation of renovated properties through Promote new home purchases to suit changing data accumulationlifestyles Improve the economics of new purchases by • Optimal matching through a vast user baseremoving intermediary feesTodayOur goal20s30s40s～UPProperty as a lifelong assetRentedOwnedPurchase priceSales pricePurchase priceSales priceRenovated properties have Achieve distribution athistorically been valued low optimal prices through fair at the time of sale, leading to valuation based on data a large depreciation in priceand matching by user basePurchase property to suit changing lifestylesOwnedOwnedOwnedTodayOurgoal© 2022 TSUKURUBA Inc.39Reference: Balance SheetSince the issuance of new shares through a 3rd party allocation in August 2021, we have actively invested to generate consistent growth in gross profits. As a result, the company holds in excess of JPY 2.5 billion in cash and deposits as of the end of January 2022. Whilst considering the macro environment, we will review our costs with a focus on fixed costs.As of Oct. 31, 2021As of Jan. 31, 2022（Unit: JPY million)（Unit: JPY million)（単位：百万円）AssetsLiabilitiesAssets資産Liabilities負債OthersShort-termborrowingsLong-term borrowings232259 966 700Cash and deposits2,745 Convertible bonds (with a conversion price of JPY 1,200per share)Cash and deposits2,557 Others851 1,438 Net assetsOthers821 1,203 Net assets257303 915 700OthersShort-termborrowingsLong-term borrowingsConvertible bonds (with a conversion price of JPY 1,200per share)© 2022 TSUKURUBA Inc.40Reference: Share Price and Trading VolumeSince the beginning of 2022, the share price has been weak due to concerns over rising global interest rates and uncertainty. However, we aim to improve our share price and trading volume over the medium to long term by increasing awareness and an understanding of our company through ongoing IR activities.6/30/2021Announcement of 3rd party allocation of new shares2021/6/30第三者割当増資リリース（JPY）1,6001,4001,2001,0008006004002000（No. of shares）Trading Volume出来高（右軸）800,000株価（左軸）Stock price 700,000600,000500,000400,000300,000200,000100,000021/321/421/521/621/721/821/921/1021/1121/1222/122/222/3© 2022 TSUKURUBA Inc. 41Q&ACategoryQuestionsAnswersCompanyRevenue was +60% YoY, exceeding the guidance announced at the beginning of the fiscal year. However, why was gross profit +30% YoY?CompanyWhat are the company’s thoughts on the outlook for future upfront investments?cowcamoWhat is the impact of the war in Ukraine on your business?cowcamoWhat are the growth indicators for cowcamo?cowcamoThe MAU declined. Was there a problem? What is your policy regarding MAU in the future?The 60% YoY increase in revenue was due to the impact of purchase and sales transactions of cowcamo’s own products. Gross profits are being generated as expected, and our full-year growth forecast is +43%. In addition, we will be expanding our staffing structure throughout the year, and believe that the company’s performance will be skewed more towards the second half of the year than the first half.Since the beginning of FY2021, the company has been aggressively investing upfront in order to achieve high gross profit growth. While the results are apparent, in light of the recent macro environment, the company has decided to review its costs, focusing on controlling fixed costs. In accordance with the above, we will continue to review costs in the second half of FY2021. However, we will maintain our earnings forecast for FY2021.There has been an impact stemming from the supply of lumber and semiconductor products. As for lumber, prices will rise by 15~20%. As for semiconductor products, the supply of stoves, hot water heaters, dishwashers, down lights, etc. will be affected. At this point, delivery of these items may be delayed by 1-3 months. However, the market inventory of properties are rising, and demand for property purchases is firm. Thus, at this point, there is no impact on our earnings forecast for FY2021.In the past, we used MAU as a leading indicator. But now that we have acquired a sufficient user base, we ask that investors look at our gross profit as a financial KPI, and GMV and Take Rate as business KPIs as growth indicators.MAU has been rising higher than originally planned, and there are still enough inquiries to raise the number of transactions and achieve our earnings forecast. Therefore, we believe that there is no problem. Currently, we are focusing on attracting inquiries rather than registered members. While it will gradually increase MAUs, we are more focused on improving the closing rate per MAU.cowcamoWhy is there quarterly volatility in the GMV?Quarterly volatility in GMV occurs as a result of market conditions, which are affected by seasonal factors. © 2022 TSUKURUBA Inc.42Company OverviewNameTSUKURUBA Inc.FoundedAugust 2011FounderHiroki MurakamiAddress2F Ikura Building, 1-1-5 Kami-meguro, Meguro-ku, Tokyo 153-0051 JapanEmployees201 full-time employees (as of January 2022)Businesses“cowcamo Business”, an end-to-end real estate online brokerage platform for used and renovated properties- cowcamo Platform Business- cowcamo Agent Service Business “Property, Planning and Design (PPD) Business“- Mission: producing new value in the real estate domain- Operation of “co-ba”, subscription-based co-working offices- Spatial design and consulting businessAwardsDeloitte Technology Company Japan Technology Fast 50 (2017-2020)2021 The 4th WOMAN’s VALUE AWARD, Excellence Award© 2022 TSUKURUBA Inc.43Corporate Philosophy© 2022 TSUKURUBA Inc.44Disclaimerfactors. under which TSUKURUBA operates. becomes available or events take place. This material includes forward-looking statements which were made based on information available at the time of writing. They donot guarantee future results and may involve certain risks and uncertainties. Please note that actual results may differ materially from those discussed in the forward-looking statements due to changes in the environment surrounding TSUKURUBA and other The factors which may affect actual results include, but are not limited to, Japanese and global economic and market conditions TSUKURUBA is not obligated to update or revise its forward-looking statements in this material, even when new information Information within this material on topics other than TSUKURUBA is quoted from published information and other sources. As such, the accuracy, appropriateness, etc. of such information has not been verified, nor are any guarantees provided thereof.Contact:email: ir@tsukuruba.comIR information: https://tsukuruba.com/ir/© 2022 TSUKURUBA Inc.45