SecProbe.io

CORRESP
1
filename1.htm

Youxin
Technology Ltd

Room
802, 803

No.
13 Hai’an Road, Tianhe District, Guangzhou, Guangdong Province ♦  People’s Republic of China

September
7, 2023

Mr.
Matthew Derby

Ms.
Alexandra Barone

Ms.
Kathleen Collins

Mr.
Chen Chen

Office
of Technology

Division
of Corporate Finance

U.S.
Securities and Exchange Commission

Mail
Stop 4631

100
F Street, N.E.

Washington,
D.C. 20549-4631

    Re:
    Youxin
    Technology Ltd

Registration
Statement on Form F-1

Submitted
September 7, 2023

CIK
No. 0001964946

Dear
Mr. Derby, Ms. Barone, Ms. Collins, and Mr. Chen:

This
letter is in response to the letter dated August 23, 2023, from the staff (the “Staff”) of the Securities and Exchange Commission
(the “Commission”) addressed to Youxin Technology Ltd (the “Company,” “we,” and “our”).
For ease of reference, we have recited the Staff’s comments in this response and numbered them accordingly. A registration statement
on Form F-1 (the “F-1”) is being filed to accompany this letter.

Amendment
No. 2 to Draft Registration Statement on Form F-1

Cover
Page

    1.
    We
    note from your disclosure on page ii that you exclude Hong Kong and Macau from your definition of “PRC” or “China”
    for the purpose of your annual report. Please revise to remove the exclusion of Hong Kong and Macau from such definition. Clarify
    that all the legal and operational risks associated with having operations in the People’s Republic of China (PRC) also apply
    to operations in Hong Kong and Macau. In this regard, ensure that your disclosure does not narrow risks related to operating in the
    PRC to mainland China only. Where appropriate, you may describe PRC law and then explain how law in Hong Kong and Macau differs from
    PRC law and describe any risks and consequences to the company associated with those laws.

Response:
We respectfully advise Staff that the definition of “China” or “PRC” disclosed on page ii refers to the People’s
Republic of China which includes Macau and Hong Kong. We have further revised throughout the disclosure to clarify that various legal
and operational risks associated with operating in the Mainland China also apply to operations in Macau and Hong Kong to the extent
applicable. As currently disclosed in the F-1, we respectfully advise Staff that the Company conducts all business operations in
Mainland China. In cases where the distinction between Mainland China and the Hong Kong and Macau Special Administrative Regions of the
People’s Republic of China remain legally or economically relevant, references to “Mainland China” have been retained.

Capitalization,
page 51

    2.
    It
    appears from your disclosures on page F-53 that on April 28, 2023 the Mezzanine Equity Holders redeemed their preferred equities
    in Guangzhou Youxin and held ordinary shares issued by Youxin Cayman. Please revise here to give effect to such redemption or explain
    why you believe pro forma effect to such transaction is not necessary. Also, revise the Summary Consolidated Financial Data on page
    13 and provide pro forma EPS for the latest year and interim period reflecting the impact of such redemption. Refer to Rule 11-01(a)(8)
    of Regulation S-X.

Response:
We have revised the disclosure on page 51 to give effect to the redemption referenced on page F-53. Additionally, we have further revised
page 13 to provide the pro forma EPS for the latest year and interim period reflecting the impact of such redemption in compliance
with Rule 11-01(a)(8) of Regulation S-X.

Management’s
Discussion and Analysis of Financial Conditions and Results of Operations Overview

Factors
Affecting Our Performance, page 54

    3.
    Please address the following as it relates to your response to prior comment 6:

    ●
    Revise
    to describe how you calculate customer renewal rate.

    ●
    Clarify
    how your measure of net dollar expansion rate supports your discussion of new customer acquisitions. In this regard, based on how
    you define the calculation, this measure appears to reflect revenue from existing customers that you retained and/or grew during
    the period. If true, consider moving the discussion of this measure to your “expanding usage by existing customer” discussion
    or explain how such measure supports new customer growth.

    ●
    Disclose
    the total number of customers as of each period included in the filing rather than stating you had “over 50 customers.”

    ●
    Tell
    us, and consider disclosing, the number of customers you have lost as a result of reducing operating Customized CRM system development
    service and the related additional function development service.

Response:
We have revised our disclosure on pages 54 and 55 to further clarify that:

    ●
    The
    customer renewal rate is calculated by dividing the number of customers who renew their contracts by the total number of customers;

    ●
    The
    net dollar expansion rate is measured by comparing revenue from customers at the start of a period with the revenue generated by
    those same customers at the end of a period. Per Staff’s suggestion, we have moved the disclosure to our “Expanding Usage
    by Existing Customer” discussion;

    ●
    We
    have revised throughout the disclosure to further clarify that we had 25 customers using professional services and 183 customers
    using our payment channel services in fiscal year 2022;

    ●
    We
    have added to our disclosure on page 55 relative to the number of customers we have lost as a result of certain reduced development
    services.

Results
of Operations

Comparison
of Results of Operations for the Six Months Ended March 31, 2023 and 2022, page 62

    4.
    We
    note the significant decline in your Customized CRM system development service revenue and additional function development service
    revenue from the six months ended March 31, 2022 compared to the same period in fiscal 2023, which you attribute to “the Company
    gradually reducing operating its Customized CRM system development service and the related additional function development service.”
    Please revise to clarify what is meant by “reducing operating” efforts. Also, revise your Overview section to include
    a discussion of any known trends or uncertainties that are reasonably likely to have a material effect on your business or results
    of operations as a result of such effort. Refer to Item 5(D) of Form 20-F.

Response:
We have revised the disclosure on page 62 to remove reference to “reducing operating” efforts in order to clarify that “the
decrease was mainly due to the PRC government’s gradual removal of COVID-19 prevention and control policies, and all of our
company’s employees were infected with COVID-19 and our company ceased operations for nearly three months.

 General

    5.
    We
    note the changes you made to your disclosure appearing on the cover page, Summary and Risk Factor sections relating to legal and
    operational risks associated with operating in China and PRC regulations. It is unclear to us that there have been changes in the
    regulatory environment in the PRC since the amendment that was filed on July 17, 2023 warranting revised disclosure to mitigate the
    challenges you face and related disclosures. The Sample Letters to China-Based Companies sought specific disclosure relating to the
    risk that the PRC government may intervene in or influence your operations at any time, or may exert control over operations of your
    business, which could result in a material change in your operations and/or the value of the securities you are registering for sale.
    The Sample Letters also sought specific disclosures relating to uncertainties regarding the enforcement of laws and that the rules
    and regulations in China can change quickly with little advance notice. We do not believe that your revised disclosure referencing
    the PRC government’s intent to strengthen its regulatory oversight conveys the same risk. Please revise.

Response:
We have revised the disclosure on the cover page, Summary and Risk Factor sections relating to legal and operational risks associated
with operating in China and PRC regulations to bolster the risks posed by the PRC government’s intent to strengthen its regulatory
oversight.

Thank
you in advance for your assistance in reviewing this response and the DRS/A. Should you have any questions with respect to the above
responses, please contact me or our U.S. legal counsel, Anthony W. Basch.

    Sincerely,

    /s/
    Shaozhang Lin

    Shaozhang
    Lin