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United States securities and exchange commission logo





                            April 15, 2024

       Paul Kellenberger
       Chief Executive Officer
       zSpace, Inc.
       65 Nicholson Lane
       San Jose, CA 95134

                                                        Re: zSpace, Inc.
                                                            Amendment No. 2 to
Draft Registration Statement on Form S-1
                                                            Submitted April 1,
2024
                                                            CIK No. 0001637147

       Dear Paul Kellenberger:

            We have reviewed your amended draft registration statement and have
the following
       comments.

              Please respond to this letter by providing the requested
information and either submitting
       an amended draft registration statement or publicly filing your
registration statement on
       EDGAR. If you do not believe a comment applies to your facts and
circumstances or do not
       believe an amendment is appropriate, please tell us why in your
response.

               After reviewing the information you provide in response to this
letter and your amended
       draft registration statement or filed registration statement, we may
have additional
       comments. Unless we note otherwise, any references to prior comments are
to comments in our
       March 11, 2024 letter.

       Amendment No. 2 to Draft Registration Statement on Form S-1 submitted
April 1, 2024

       Capitalization, page 51

   1.                                                   We note your response
to prior comment 10. Please revise to include an adjustment to
                                                        eliminate the interest
expense and debt discount amortization on loans that were converted
                                                        into NCNV preferred
stock as part of the recapitalization transaction. Include similar
                                                        adjustments to the pro
forma consolidated balance sheet data on page 12.
       Dilution, page 54

   2.                                                   We note your response
to prior comment 11. As previously requested, please revise to
                                                        exclude deferred
offering costs from net tangible book value and net tangible book
                                                        value per share.
 Paul Kellenberger
zSpace, Inc.
April 15, 2024
Page 2
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Non-GAAP Financial Measures, page 60

3.     Your response to prior comment 12 indicates that the inventory
adjustments in 2022
       related to inventory write-offs associated with product and component
shortages due to
       pandemic-related supply chain disruptions, which you do not expect to
recur; however, it
       appears that there will be similar inventory adjustments in 2023. As
inventory write-offs
       are a normal, recurring operating expense necessary to operate your
business these
       adjustments are inconsistent with Question 100.01 of the Non-GAAP C&DIs.
Please
       revise your non-GAAP measures to remove these adjustments.
Consolidated Financial Statements
Note 7. Stock-based Compensation Expense
Determination of fair value of stock options, page F-27

4.     We note your responses to prior comments 20 and 21 and your revised
disclosures. Please
       tell us how you considered ASC 718-10-30-27 when determining your
accounting. In this
       regard, we note that when you determined the expected term of the stock
options with a
       performance condition, you considered the contractual date of the
performance condition
       and that the volatility was determined over the estimated time to the
liquidity event. ASC
       718-10-30-27 indicates that performance conditions which affect vesting
should not be
       reflected in estimating the fair value of an award at the grant date.
Please revise your
       disclosures and the valuations of any stock options containing
performance conditions
       accordingly. Also, as previously requested in prior comment 20, tell us
the fair value of
       the underlying common stock for the options granted in 2022.
September 2022 Stock Option Issuance, page F-28

5.     You disclose on page F-29 that you will begin recognizing expense
related to the
       September 2022 options upon the occurrence of a liquidity event and it
appears that this
       offering is a liquidity event. Please revise to disclose the amount of
expense you will
       record upon effectiveness of the offering.
       Please contact Dave Edgar at 202-551-3459 or Chris Dietz at 202-551-3408
if you have
questions regarding comments on the financial statements and related matters.
Please contact
Uwem Bassey at 202-551-3433 or Jan Woo at 202-551-3453 with any other
questions.



                                                            Sincerely,
FirstName LastNamePaul Kellenberger
                                                            Division of
Corporation Finance
Comapany NamezSpace, Inc.
                                                            Office of
Technology
April 15, 2024 Page 2
cc:       Evan Mendelsohn
FirstName LastName
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