On June 15, 2021, we announced that we will receive a 500 million yen investment from Trusco Nakayama Co., Ltd. and enter into a capital and business alliance (*1). This partnership will promote the creation of an open distribution platform that will permanently support Trusco Nakayama's manufacturing in Japan, and will also help Trusco Nakayama to innovate its customers' core operations and promote digital transformation (hereinafter referred to as DX). We will greatly support the realization of the value provision of "promotion".

Cinnamon AI provides AI consulting and AI products with the mission of "creating a creative society together with AI" and aiming to innovate the core business of our customers and promote DX. Cinnamon AI has a track record of dealing with over 100 companies, mainly major domestic companies, and its strength is its ability to respond to a wide range of unstructured data utilization, which is the key to promoting DX. In the future, we will link the Harvest Loop (a loop structure: architecture in which data is automatically accumulated and leads to sustainable business growth), which we advocate as the core of a company's growth strategy, with the "purpose" of our client companies. By doing so, we will draw up AI strategy designs that give our client companies a competitive advantage and strengthen our ability to support their sustainable growth.

Trusco Nakayama has announced that it will build a new distribution platform, ``Trusco Platform,'' with the aim of reforming and developing its own distribution infrastructure. In addition, the efforts to realize this new "Trusco Platform" are called "Trusco DX2.0" (*2), which includes logistics DX using a unique AI model using data-driven technology and the latest robots, expansion of product data, and customer experience ( We aim to create a new distribution platform where ``the best is already there'' by acquiring overwhelming speed and responsiveness to change in UX).

Our company will promote the realization of "Trusco DX2.0" by providing AI models centered on the use of a wide range of unstructured data. Furthermore, in order to further increase the momentum toward realizing "Trusco DX2.0," both companies decided that deeper collaboration in strategy development and execution is essential, leading to this alliance. This partnership will greatly support our ability to provide value by ``innovating our customers' core operations and promoting DX,'' and is a very important step for our company.

Specifically, we plan to expand the scope of AI utilization by starting with expanding product data, optimizing inventory, and automating operations. In addition, in order to realize Trusco Nakayama's vision of creating an open distribution platform that permanently supports Japanese manufacturing, we will introduce AI, which is essential to all management fields such as technology, human resources, and organization. We will strengthen our business over the medium to long term.

<Comment from Mirai Hirano, our representative director, president and CEO>
Trusco Nakayama's passion for the strategic challenge of DXing the entire distribution industry, Cinnamon AI's diverse technologies and track record, and possibilities for the future met, resulting in this bold partnership. Given the scale of the company to revolutionize the industry itself and the speed that only a startup can offer, I feel that the mutual complementarity and compatibility of the management is excellent. The AI strategy based on the Harvest Loop (a loop structure: architecture in which data is automatically accumulated and leads to sustainable business growth), which Cinnamon AI proposes as the core of its growth strategy, is expected to make a major contribution. It's a sobering feeling. We are starting with three themes: expanding product data, optimizing inventory, and automating operations, but we feel the possibilities are limitless in expanding these areas.

I met Trusco Nakayama at a breakfast party hosted by Mr. Kajiyama, Minister of Economy, Trade and Industry, who won the DX Grand Prix. I am deeply grateful to the IPA Unexplored Software Creation Project, NEDO, J-Startup, etc., as well as this encounter and the various supports from the Japanese government, including the Ministry of Economy, Trade and Industry.

We believe that this partnership is the embodiment of the teaming of diverse participants with large companies, academia, and other startups that are transforming Japan's logistics and digital, while leveraging support from the government. We will do our best to serve as an example of multi-stakeholders coming together to take on global issues, and to help create a sustainable world.

<Comment from Tetsuya Nakayama, President and Representative Director of Trusco Nakayama>
In order to improve convenience for our customers, we have made investments in areas such as logistics and digital technology.

In addition to approximately 100 highly skilled AI personnel, Cinnamon AI has a clear track record of implementing AI in financial institutions and other areas, and is putting into practice its unique theory called Harvest Loop. Our company has made digital investments in the past, but in order to further expand product data and improve operational efficiency, advanced AI technology will be essential. Since Cinnamon AI has built an AI model that is suitable for solving our company's problems, we have decided to enter into a capital and business alliance with the aim of further developing both companies in the future.

In the future, we will work with Cinnamon AI to utilize AI to expand product data, which is the source of our competitiveness, optimize inventory, automate operations, and introduce AI that is essential to all management fields such as technology, human resources, and organization. By doing so, we will strengthen our business over the medium to long term.

*1: This investment and capital and business alliance will be approved at the shareholders' meeting and board of directors resolution scheduled for late June.
*2: "Trusco DX2.0" Since 2018, we have been promoting and strengthening DX, including the renewal of core systems, but we have positioned the efforts so far as "Trusco DX1.0" and will realize the future "Trusco Platform". A general term for efforts to achieve this goal.

[Trusco Nakayama Co., Ltd. Company Profile]
Company name: Trusco Nakayama Co., Ltd.
URL:http://www.trusco.co.jp/
Address: Tokyo Head Office: Trusco Fiorito Building, 4-28-1 Shinbashi, Minato-ku, Tokyo
Established: March 1964
Representative: Tetsuya Nakayama, Representative Director and President

[Cinnamon Co., Ltd. Company Profile]
Company name: Cinnamon Co., Ltd.
URL:https://cinnamon.is/
Address: 6th floor, Spirit Building, 3-19-13 Toranomon, Minato-ku, Tokyo
Established: October 2016
Representative: Mirai Hirano, Representative Director, President and CEO

Recruitment page (please see here for available positions and how to apply):
http://cinnamon.is/recruiting/

■Business content: Artificial intelligence consulting business, artificial intelligence product business
Cinnamon AI's mission is to "create a world full of creativity with AI," and we are working on developing advanced business AI solutions, and we have a track record of providing them to many major domestic companies. In addition, we have established artificial intelligence laboratories in Vietnam (Hanoi and Ho Chi Minh City) and Taiwan, and have succeeded in recruiting a large number of AI engineers. Recently, in addition to the AI OCR "Flax Scanner," we have begun commercializing the specialized voice recognition technology "Rossa Voice," and have begun selling it mainly to major companies. In addition, Cinnamon AI has many advanced AI algorithms based on three unique research areas: “Digitize,” “Structure,” and “Understand.” We are continuously developing business AI solutions that utilize unstructured data.