Hapbee Technologies, Inc. (TSXV: HAPB) (OTCQB: HAPBF) (FSE: HA1) ("Hapbee" or the "Company"), a leading provider of wellness wearables and biostreaming technology, is pleased to provide the following shareholder letter from Hapbee CEO Yona Shtern.

Dear shareholders,

I'd like to begin this update by thanking all of our shareholders for your support and confidence in Hapbee. Although the current volatile macro environment has hindered the capital markets, we are full steam ahead in growing Hapbee's one-of-a-kind wellness platform. Shareholders' support of our mission during these volatile times has not gone unnoticed by our team. The best way to show our appreciation is to continue accelerating growth. 

Our team remains deeply focused on the four pillars of growing our business:

1. Getting Hapbee into more customers' hands so they can experience the wellness benefits for themselves
2. Expanding our product pipeline - the Hapbee Sleep & Relief Pillow just started selling on our website
3. Increasing our subscriber base - the most significant long-term value driver for Hapbee and our shareholders
4. Accelerating market penetration through enterprise sales

Hapbee's platform - for both consumer and enterprise channels -  is built upon a recurring revenue model (subscription for consumers and licensing for enterprise). This offers the most attractive value proposition from an investment perspective because of the long-term, predictable and repeatable nature of revenue streams matched with higher revenue multiples typically afforded ARR technology businesses. At the end of Q1, 2022 we had nearly 3,000 active subscribers on the platform, an increase of 246% over Q1 2021. Paid subscriber retention after six months increased from 22% in September 2021 to 65% in March 2022, driven by significant improvements to our in-app experience, expansion of blends, and investment in an automated back-end billing system. The monthly subscription fee ranges from $12 to $19 USD — a high-margin aspect of our business. I like to reiterate that we are a software subscription and licensing company first; hardware second.

Long story short, the platform is gaining traction and demonstrating stickiness. We continue to invest in improving user engagement and retention and will leverage critical customer feedback to enhance the user experience.

Over the last six months, we have learned a ton from the investments made in the marketing of our wellness platform. These learnings include: effective platforms to market the Hapbee Neckband; how to better educate prospective buyers before a call to action; more cost-effective lead generation, and how we should pursue our B2B strategy — which I believe will become a key driver of sales for Hapbee in 2023. I anticipate making significant progress on the B2B front in the nearer term and look forward to sharing any material developments.

The sleep market has quickly become our most important sector, which is why we are pursuing the launch of three new sleep-related products this year: The Sleepbee Mattress Topper, Sleepbee Sleep Mask, and the Hapbee Sleep & Relief Pillow (the "Pillow"). The Pillow, which launched on our website earlier this week, is specially designed to be compatible with and enhance the functionality of the Hapbee Neckband as a sleep and relief device. It helps position Hapbee as a sleep solution and provides new and existing Hapbee users with an affordable, product-enhancing accessory. At the same time, the Pillow will be another high-margin offering for our company. I anticipate the Sleepbee Mattress Topper will be a premium offering, and the Sleepbee Sleep Mask will have a mid-level price point.

The sleep-tech market is massive and anticipated to grow at a rapid clip. In 2021, the Sleep Tech Devices Market was valued at roughly $15 billion¹, and it is projected to reach $67 billion by 2030. We want to be a major player in this space within 24 months. It is a market with extreme potential for our platform, given the fact that over 60% of Hapbee customers primarily use Hapbee to optimize their sleep routines.

We conducted our first sleep-related user study/survey spanning roughly five months to highlight our platform's advantage within the sleep tech space. We now have quantifiable data that shows Hapbee helped improve consumer wearable sleep tracker scores (utilizing Oura Ring) for quality of sleep, length of sleep, reduced restlessness, and the time it took to fall asleep.

The results of our study amplified our motivation to focus on this opportune sector. I encourage everyone to read our press release dated May 9, 2022 to learn more about these initial study results.

In March 2021, Hapbee entered into agreements with two U.S. military non-profit groups to collect feedback on the impact of Hapbee signals on users' stress and productivity levels. The results after one year were inspiring and edifying. In March of this year, The Hapbee Neckband was selected as an integral and essential part of Grey Team's (U.S. veterans support group) wellness solution for military veterans. Again, if you haven't read our press release about this project from March 22, 2022, I encourage you to do so. This was a gratifying project that I think will open other doors for Hapbee to help military veterans in the future.

This May, Hapbee was recognized in Fast Company's 2022 World Changing Ideas Awards as an honorable mention for our innovative platform in the Wellness Category.

When I meet with Hapbee customers, be it one-on-one or at conferences and gatherings, their feedback from using the Hapbee Neckband energizes me. I know from meeting with customers that we are already having a profound impact on many. That inspires us to continually advance our wellness platform while improving our ability to educate new audiences on the potential benefits of this one-of-a-kind technology.

There is a technology adoption curve for an innovative platform like ours, and I can appreciate people's questions when first learning about Hapbee. There's nothing else like it on the market today. One strategy to encourage people to try our product, especially if they have a healthy degree of skepticism, is the recent implementation of our 90-day money-back guarantee. As I stated near the onset of this update, we are focused on getting Hapbee into as many people's hands as possible to help mainstream our brand and transformative wellness platform.

I look forward to updating our shareholders over the coming months. Thank you for your continued support.

Sincerely,

Yona Shtern
CEO & Chairman, Hapbee Technologies, Inc.

Hapbee products are available for purchase at Hapbee.com and through a growing network of authorized Hapbee dealers.

For more information about Hapbee, please visit Hapbee.com. Hapbee is a leading wearable wellness technology platform with a mission to help people improve their wellbeing and enhance how they feel. The Company is the creator of the Hapbee Neckband, the Sleepbee Sleep Mask, and the Sleepbee Bed Topper, which are all powered by an ultra-low radio frequency energy (ulRFE®) biostreaming platform that delivers low-power electro-magnetic signals and blends designed to help optimize users' sleep, productivity, recovery, and downtime.

Certain statements in this news release may constitute "forward-looking information" within the meaning of applicable securities laws (also known as forward-looking statements). Forward-looking information involves known and unknown risks, uncertainties and other factors, and may cause actual results, performance or achievements or industry results, or results on certain individuals to be materially different from any future results, performance or achievements or industry results expressed or implied by such forward-looking information. Forward-looking information generally can be identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "feel", "intend", "may", "plan", "predict", "project", "subject to", "will", "would", and similar terms and phrases, including references to assumptions.

Forward-looking information is based on a number of key expectations and assumptions made by Hapbee, including, without limitation: the growth of the worldwide sleep and wellness market; the suitability of the Hapbee Neckband, Sleep products and blends for users; no change to laws or regulations that negatively affect Hapbee's business; the ability of Hapbee to source supplies required to manufacture its products; all necessary approvals will be received and all conditions will be satisfied or waived; and Hapbee will be able to operate its business as planned. Hapbee is not a medical device and is not to be used for medical purposes. Although the forward-looking information contained in this news release is based upon what Hapbee believes to be reasonable assumptions and reasonable testing, it cannot assure investors and or users that actual results will be consistent with such information.

Forward-looking information is provided for the purpose of presenting information about management's current expectations and plans relating to the future and readers are cautioned that such statements may not be appropriate for other purposes. Forward-looking information involves significant risks and uncertainties and should not be read as a guarantee of future performance or results as actual results may differ materially from those expressed or implied in such forward-looking information. Management believes that the expectations reflected in the forward-looking information contained herein are based upon reasonable assumptions and information currently available; however, management can give no assurance that actual results will be consistent with such forward-looking information.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

1. https://www.gminsights.com/industry-analysis/sleep-tech-devices-market