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Our business operations are subject to numerous risks, factors and uncertainties, including those outside of our control, that could cause our actual results to be harmed, including risks regarding the following:
+Added: • Unstable market and economic conditions may have serious adverse consequences on our business, financial condition, and share price.
• Our rapid revenue growth may not be indicative of our future revenue growth.
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If we are not able to grow in an efficient manner, our business, financial condition and results of operations could be harmed.
−Removed: • Failure to effectively develop and expand our sales and marketing capabilities could harm our ability to expand our customer base and achieve broader market adoption of our platform and products.
+Added: • Failure to effectively develop our sales and marketing capabilities could harm our ability to expand our customer base and achieve broader market adoption of our platform and products.
• We are dependent on a single platform, and the failure to achieve continued market acceptance of our platform could cause our results of operations to suffer.
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• We may need to reduce prices or change our pricing model to remain competitive.
−Removed: • Our business depends on our ability to send consumer engagement messages, including emails, SMS and mobile and web notifications, and any significant disruption in service with our third-party providers or on mobile operating systems could result in a loss of customers or less effective consumer-brand engagement, which could harm our business, financial condition and results of operations.
+Added: • Our business depends on our ability to send consumer engagement messages, including email, SMS and mobile and web notifications, and any significant disruption in service with our third-party providers or on mobile operating systems could result in a loss of customers or less effective consumer-brand engagement, which could harm our business, financial condition and results of operations.
• We rely upon third-party providers of cloud-based infrastructure, including Amazon Web Services, to host our products.
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• We employ third-party licensed software for use in or with our platform, and the inability to maintain these licenses or errors or vulnerabilities in the software we license could result in increased costs, or reduced service levels, which would adversely affect our business.
−Removed: • We have identified three material weaknesses in our internal control over financial reporting, and if we are unable to achieve and maintain effective internal control over financial reporting, the accuracy and timing of our financial reporting may be adversely affected.
+Added: • We have identified one material weakness in our internal control over financial reporting, and if we are unable to achieve and maintain effective internal control over financial reporting, the accuracy and timing of our financial reporting may be adversely affected.
• The dual class structure of our common stock has the effect of concentrating voting control with our executive officers, directors and significant holders of our capital stock, which limits the ability of holders of our Class A common stock to influence the outcome of important transactions.
Risks Related to Our Growth and Capital Requirements
+Added: Unstable market and economic conditions may have serious adverse consequences on our business, financial condition and share price.
+Added: The global economy, including credit and financial markets, has experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates, increases in inflation rates, higher interest rates and uncertainty about economic stability.
+Added: For example, the measures taken in response to the COVID-19 pandemic have been linked to inflation, the threat of an economic slowdown and extreme volatility in the capital markets.
+Added: Similarly, the ongoing military conflict between Russia and Ukraine has created extreme volatility in the global capital markets and is expected to have further global economic consequences, including disruptions of the global supply chain and energy markets.
+Added: Continued volatility and disruptions may have adverse consequences on us or the third-parties on whom we rely.
+Added: If the financial, equity or credit markets deteriorate, including as a result of the measures taken to combat inflation, volatility in the banking sector, political unrest or war, it may make any necessary debt or equity financing more difficult to obtain in a timely manner or on favorable terms, more costly or more dilutive.
+Added: Increased inflation rates can adversely affect us by increasing our costs, including labor and employee benefits costs.
+Added: In addition, higher inflation and macroeconomic turmoil and uncertainty could also adversely affect our customers, which could reduce demand for our products and services.
+Added: For instance, the financial services industry, particularly cryptocurrency exchanges that have been subject to significant turmoil in light of decreased consumer confidence in cryptocurrencies as investments and the high-profile collapse of certain exchanges, has encountered sustained and significant declines due to macroeconomic pressures.
+Added: We cannot predict how this instability may impact certain of our financial services customers or their demand for our products.
+Added: We were founded in 2011, but our business and revenue have grown rapidly over the last several years.
+Added: As a result of our limited history operating at our current scale, our ability to accurately forecast our future results of operations is limited and subject to a number of uncertainties, including our ability to plan for and model future growth, particularly in a softening economic environment.
+Added: Recent increases in inflation, economic volatility and related increases in interest rates have affected customer spending behavior.
+Added: Significant continued increases in inflation, continued economic volatility and related increases in interest rates could have a material adverse effect on our business, financial condition and results of operations.
+Added: To the extent there is a sustained general economic downturn and our customer engagement platform is perceived by customers and potential customers as too costly, or too difficult to deploy or migrate to, our revenue may be disproportionately affected by delays or reductions in general customer engagement technology spending.
+Added: This perception has previously, and may continue to, result in an extension of our sales cycle with potential customers, thus increasing the time and cost associated with our sales process.
+Added: Further, even if our customers choose to use our platform, they may nonetheless reduce their customer engagement technology spending and elect not to purchase additional products and services in the future due to budget limitations.
+Added: Also, competitors may respond to market conditions by lowering prices and attempting to lure away our current and potential customers.
+Added: In addition, macroeconomic uncertainty may result in an increased pace of consolidation in certain industries in which our customers operate.
+Added: If this were to occur it may result in reduced overall spending on our services, particularly if our customers are acquired by organizations that do not use our services.
+Added: We cannot predict the timing, strength or duration of any economic slowdown, instability or recovery, generally or within any particular industry.
+Added: If the economic conditions of the general economy or the markets in which we operate worsen from present levels, our business, results of operations and financial condition could be materially and adversely affected.
Our rapid revenue growth may not be indicative of our future revenue growth.
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Overall growth of our revenue depends on several factors, including our ability to:
−Removed: • expand subscriptions for our platform to our existing customers;
+Added: • expand subscriptions for additional functionality within our platform to our existing customers;
• expand the products for and functionality of our platform and achieve market acceptance for them;
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We may require additional capital to support business growth, and this capital might not be available on acceptable terms, if at all.
−Removed: We have funded our operations since inception primarily through equity financings and, more recently, sales of subscriptions to our platform.
+Added: We have funded our operations since inception primarily through equity financings, including through the public markets in our initial public offering, and sales of subscriptions to our platform.
We cannot be certain when or if our operations will generate sufficient cash to fully fund our ongoing operations or the growth of our business.
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Accordingly, we may need to engage in equity or debt financings to secure additional funds.
−Removed: Additional financing may not be available on terms favorable to us, if at all.
+Added: Additional financing may not be available on terms favorable to us, including as a result of inflationary pressure and a higher interest rate environment, if at all.
If adequate funds are not available on acceptable terms, we may be unable to invest in future growth opportunities, which could harm our business, financial condition and results of operations.
−Removed: If we incur debt, the debt holders would have
−Removed: rights senior to holders of our Class A common stock to make claims on our assets, and the terms of any debt could include restrictive covenants relating to our capital raising activities and other financial and operational matters, any of which may make it more difficult for us to obtain additional capital and to pursue business opportunities.
−Removed: Furthermore, if we issue equity securities, our stockholders will experience dilution, and the new equity securities could have rights senior to those of our Class A common stock.
+Added: If we incur debt, the debt holders would have rights senior to holders of our Class A and Class B common stock to make claims on our assets, and the terms of any debt could include restrictive covenants relating to our capital raising activities and other financial and operational matters, any of which may make it more difficult for us to obtain additional capital and to pursue business opportunities.
+Added: Furthermore, if we issue equity securities, our stockholders will experience dilution, and the new equity securities could have rights senior to those of our Class A common stock and Class B common stock.
Because our decision to issue securities in the future will depend on numerous considerations, including factors beyond our control, we cannot predict or estimate the amount, timing, or nature of any future issuances of debt or equity securities.
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We have a limited history operating at our current scale, and our future results of operations may fluctuate significantly due to a wide range of factors, which make it difficult to forecast our future results of operations.
−Removed: We were founded in 2011, but our business and revenue have grown rapidly over the last several years.
−Removed: As a result of our limited history operating at our current scale, our ability to accurately forecast our future results of operations is limited and subject to a number of uncertainties, including our ability to plan for and model future growth.
Our results of operations may fluctuate significantly from period to period due to many factors, many of which are outside of our control, including:
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Any one of these or other risks or uncertainties discussed elsewhere in this report or the cumulative effect of some of these factors may result in fluctuations in our revenue, results of operations and cash flows, meaning that quarter-to-quarter comparisons of our revenue, results of operations and cash flows may not necessarily be indicative of our future performance, may cause us to miss our guidance and analyst expectations and may cause the price of our Class A common stock to decline.
−Removed: Additionally, if our assumptions regarding these risks and uncertainties are incorrect or change, including as a result of the ongoing COVID-19 pandemic, including the emergence of new variant strains of COVID-19, or the ongoing geopolitical instability resulting from the conflict between Russia and Ukraine, or if we do not address these risks successfully, our revenue and results of operations could differ materially from our expectations, and our business, financial condition and results of operations may be adversely affected.
+Added: Additionally, if our assumptions regarding these risks and uncertainties are incorrect or change, including as a result of (1) global and domestic disruptions, such as the COVID-19 pandemic, the emergence of new variant strains of COVID-19 or any future similar pandemic and any uncertainties related to the recovery therefrom, (2) international conflicts that may impact international trade and global economic performance, such as the ongoing conflict between Russia and Ukraine and the related economic sanctions imposed by the United States and its trading partners against Russia and Belarus and (3) other macroeconomic trends, such as instability among financial institutions, international and domestic supply chain risks, inflationary pressure, interest rate increases and declines in consumer confidence, that impact us and our customers, or if we do not address these risks successfully, our revenue and results of operations could differ materially from our expectations, and our business, financial condition and results of operations may be adversely affected.
We have a history of operating losses and may not achieve or sustain profitability in the future.
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W h ile we have experienced significant revenue growth in recent periods, we are not certain whether or when we will achieve or maintain profitability in the future.
−Removed: We also expect our costs and expenses to
−Removed: increase in future periods, which could negatively affect our future results of operations if our revenue does not continue to increase.
+Added: We also expect our costs and expenses to increase in future periods, which could negatively affect our future results of operations if our revenue does not continue to increase.
In particular, we intend to continue to expend substantial financial and other resources on:
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• international expansion;
−Removed: • general administration, including increased insurance, legal and accounting expenses associated with being a public company.
+Added: • general administration, including increased insurance, legal and accounting expenses associated with being a public company and transitioning from an emerging growth company to a large accelerated filer.
These investments may not result in increased revenue.
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Our addressable market depends on a number of factors, including businesses’ desire to differentiate themselves through digital customer engagement, partnership opportunities, changes in the competitive landscape, technological changes, data security or privacy concerns, customer budgetary constraints, changes in business practices, changes in the regulatory environment and changes in economic conditions.
−Removed: Our estimates and forecasts relating to the size and expected growth of our market may prove to be inaccurate, and our ability to produce accurate estimates and forecasts may be impacted by economic uncertainty that is outside our control, including the uncertainty associated with (i) the ongoing COVID-19 pandemic, including the emergence of new variant strains of COVID-19, and any uncertainties related to the recovery therefrom, (ii) international conflicts that may impact international trade and global economic performance, such as the ongoing conflict between Russia and Ukraine and the related economic sanctions imposed by the United States and its trading partners against Russia and Belarus, and (iii) other macroeconomic trends, such as international and domestic supply chain risks that impact our customers.
+Added: Our estimates and forecasts relating to the size and expected growth of our market may prove to be inaccurate, and our ability to produce accurate estimates and forecasts may be impacted by economic uncertainty that is outside our control, including the uncertainty associated with (1) global and domestic disruptions, such as the COVID-19
+Added: pandemic, the emergence of new variant strains of COVID-19 or any future similar pandemic and any uncertainties related to the recovery therefrom, (2) international conflicts that may impact international trade and global economic performance, such as the ongoing conflict between Russia and Ukraine and the related economic sanctions imposed by the United States and its trading partners against Russia and Belarus, and (3) other macroeconomic trends, such as instability among financial institutions, international and domestic supply chain risks, inflationary pressure, interest rate increases and declines in consumer confidence, that impact us and our customers.
Any of these risks could have a significant impact on our business or the business of our customers, either of which could result in a material adverse effect on our results and operations and cause our current estimates and projections to be inaccurate.
Even if the market in which we compete meets the size estimates and growth rates we forecast, our business could fail to grow at similar rates, if at all.
+Added: We track certain operational metrics with internal systems and tools and do not independently verify such metrics.
+Added: Certain of our operational metrics are subject to inherent challenges in measurement, and any real or perceived inaccuracies in such metrics may adversely affect our business and reputation.
+Added: We track certain operational metrics, including the number of customers, monthly active users, platform enabled interactions, consumer generated data points, customer messages, annual recurring revenue and dollar-based net retention rate and Non-GAAP free cash flow.
+Added: Our operational metrics are tracked with internal systems and tools that are not independently verified by any third party and which may differ from estimates or similar metrics published by third parties due to differences in sources, methodologies, or the assumptions on which we rely.
+Added: Our internal systems and tools have a number of limitations, and our methodologies for tracking these metrics may change over time, which could result in unexpected changes to our metrics, including the metrics we publicly disclose.
+Added: If the internal systems and tools we use to track these metrics undercount or overcount performance or contain algorithmic or other technical errors, the data we report may not be accurate.
+Added: While these numbers are based on what we believe to be reasonable estimates of our metrics for the applicable period of measurement, there are inherent challenges in measuring how our platform is used across large populations.
+Added: In addition, limitations or errors with respect to how we measure data or with respect to the data that we measure may affect our understanding of certain details of our business, which could affect our long-term strategies.
+Added: If our operating metrics are not accurate representations of our business, if investors do not perceive our operating metrics to be accurate, or if we discover material inaccuracies with respect to these figures, we expect that our business, reputation, financial condition, and results of operations would be adversely affected.
Risks Related to Our Business and Our Brand
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There are several established and emerging competitors that address specific aspects of customer engagement.
−Removed: We face intense competition from software companies that offer marketing solutions, such as legacy marketing clouds like Adobe and Salesforce, and point solutions like Airship, Iterable, Leanplum, MailChimp and MoEngage.
+Added: We face intense competition from software companies that offer marketing solutions, such as legacy marketing clouds like Adobe and Salesforce, and point solutions like Airship, Iterable, Leanplum (CleverTap), MailChimp (Intuit) and MoEngage.
Many of our existing competitors have, and our potential competitors could have, substantial competitive advantages, such as greater name recognition, longer operating histories, larger sales and marketing budgets and resources, greater customer support resources, lower labor and development costs, larger and more mature intellectual property portfolios and substantially greater financial, technical and other resources than we do.
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Any such pricing advantages that our competitors have may negatively affect our ability to gain new customers and retain existing customers.
+Added: Additionally, to the extent there is a sustained general economic downturn, our customers and potential customers may experience delays and reductions in general customer engagement technology spending.
+Added: As a result, our competitors may respond to market conditions by lowering prices and attempting to lure away our current and potential customers.
With the introduction of new technologies and the entry of new competitors into the market, we expect competition to persist and intensify in the future.
−Removed: In addition, merger and acquisition activity in the technology industry could increase the likelihood that we compete with other large technology companies.
+Added: In addition, recently, there has been significant merger and acquisition activity among our competitors, including the acquisition of MailChimp by Intuit and the acquisition of Leanplum by CleverTap.
+Added: Continued merger and acquisition activity in the technology industry could further increase the likelihood that we compete with other large technology companies.
This could harm our ability to increase sales, maintain or increase subscription renewals, and maintain our prices.
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New start-up companies that innovate, and large companies that are making significant investments in research and development, may invent similar or superior products and technologies that compete with one or more of our platform offerings.
−Removed: In addition, some of our competitors may enter into new alliances with each other or may establish or strengthen cooperative relationships with agency partners, technology and application providers in complementary categories, or other parties.
+Added: In addition, some of our
+Added: competitors may enter into new alliances with each other or may establish or strengthen cooperative relationships with agency partners, technology and application providers in complementary categories, or other parties.
Competitors may also consolidate with existing service providers or strategic partners that we rely on, and as a result we could lose partnerships that are difficult to replace.
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To the extent our customers’ marketing strategies are not effective, they may reduce the use of our products and services or fail to renew their existing contracts.
+Added: Further, to the extent there is a sustained general economic downturn and our customers and potential customers experience delays or reductions in general customer engagement technology spending, potential customers may be unwilling to take on the additional cost associated with adopting our platform as an alternative to their existing products or service providers, and if they choose to adopt our platform, they may not purchase additional products and services in the future due to budget limitations.
As a result of these and other factors, we may be unable to attract new customers, which may have an adverse effect on our business, financial condition and results of operations.
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The market in which we compete is relatively new and subject to rapid technological change, evolving industry standards and changing regulations, as well as changing customer and consumer needs, requirements and preferences, including changes in the use of channels through which consumers desire to communicate with brands.
−Removed: For instance, the SEC has recently indicated that it may increase regulatory focus on the use of customer engagement tools in the financial services industry, and we cannot predict if other regulators will take similar actions in other markets in the future.
+Added: For instance, the SEC has previously indicated that it may increase regulatory focus on the use of customer engagement tools in the financial services industry, and we cannot predict if other regulators will take similar actions in other markets in the future.
Any regulatory restrictions on the use of customer engagement tools from the SEC or other domestic or foreign regulators could have the effect of reducing demand for our platform in this and other markets.
+Added: Further, recent major advances in, and the public availability of, generative artificial intelligence is likely to be a major disruptor in consumer engagement and marketing strategies.
The success of our business will depend, in part, on our ability to adapt and respond effectively to these changes on a timely basis.
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We expect that the number of integrations with our customers’ infrastructure that we will need to support will continue to expand as developers adopt new software solutions, and we will have to develop new versions of our platform to work with those new solutions.
−Removed: This development effort may require significant engineering, sales and marketing resources, all of which could adversely affect our business.
+Added: This development effort may require significant engineering, sales and marketing resources, all of which could adversely affect our
Any failure of our platform to operate effectively with customer infrastructures could reduce the demand for our platform, and our business, financial condition and results of operations may be adversely affected.
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Our ability to scale our business is dependent on our ability to maintain and grow our revenue through new and renewed customer subscriptions to our platform, from which we derive substantially all of our revenue.
−Removed: We cannot assure you that we will be able to renew subscriptions with any of our customers at the same or higher contract value.
+Added: We cannot assure you that we will be able to renew subscriptions with any of our customers at the same or higher contract value, particularly if our customers experience reductions or delays in general customer engagement technology spending in connection with a sustained general economic downturn.
In addition, some customers have multiple order forms with different divisions of their entities, which could increase the complexity of negotiating renewals.
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Further, some of our contracts limit the amount we can increase prices from period to period or include pricing guarantees.
−Removed: In the past, we have made certain pricing concessions for customers that were significantly negatively impacted by the COVID-19 pandemic.
+Added: Accordingly, these pricing restrictions may cause the revenue generated from these contracts to not keep pace with our costs, particularly if we are adversely affected by inflation increasing our costs, including labor and employee benefit costs In the past, we have also made certain pricing concessions for customers that were significantly negatively impacted by the COVID-19 pandemic, and we may be forced to make similar pricing concessions in the future if our customers face other economic challenges to their businesses.
If our customers do not renew their agreements, require pricing concessions, terminate their agreements as a result of a change of control or otherwise, renew their agreements on terms less favorable to us or fail to purchase additional product subscriptions, our revenue may decline, and as a result our ability to scale our business may be impaired and our business, financial condition and results of operations would likely be harmed as a result.
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Any such expansion efforts may reduce revenue or may not bring the benefits we anticipate, and our business, financial condition and results of operations may be adversely affected.
−Removed: Failure to effectively develop and expand our sales and marketing capabilities could harm our ability to expand our customer base and achieve broader market adoption of our platform and products.
−Removed: Our ability to expand our customer base and achieve broader market adoption of our platform will depend on our ability to expand our sales and marketing operations.
−Removed: We plan to continue expanding our sales team and strategic partners, both domestically and internationally;
+Added: Failure to effectively develop our sales and marketing capabilities could harm our ability to expand our customer base and achieve broader market adoption of our platform and products.
+Added: Our ability to expand our customer base and achieve broader market adoption of our platform will depend on the productivity of our sales and marketing operations.
+Added: We plan to continue expanding our sales team and strategic partners over the long term, both domestically and internationally;
however, there is no assurance that we will be successful in attracting and retaining talented sales personnel or strategic partners or that any new sales personnel will be able to achieve productivity in a reasonable period of time or at all.
We also plan to dedicate significant resources to sales and marketing programs to drive new customer acquisition, as well as engage with customers to promote upsell and cross-sell opportunities.
−Removed: We also engage with industry analysts, consulting firms, marketing service providers, data and technology partners, marketing agencies and other solution
−Removed: partners, business and trade press, and other industry experts who exert considerable influence in our market to promote our platform and our brand.
+Added: We also engage with industry analysts, consulting firms, marketing service providers, data and technology partners, marketing agencies and other solution partners, business and trade press, and other industry experts who exert considerable influence in our market to promote our platform and our brand.
Our business, financial condition and results of operations may be harmed if our sales and marketing efforts do not generate a corresponding increase in revenue.
−Removed: In addition, we may not achieve anticipated revenue growth from expanding our sales team if we are unable to hire, develop and retain talented sales personnel, if our new sales personnel are unable to achieve desired productivity levels in a reasonable period of time, or if our sales and marketing programs are not effective.
+Added: In addition, we may not achieve anticipated revenue growth from expanding our sales team if we are unable to hire, develop and retain talented sales personnel, if our new sales personnel are unable to achieve desired productivity levels in a reasonable period of time, or if our sales and marketing
+Added: programs are not effective.
If the cost of marketing our platform and products increases or competition reduces the effectiveness of our marketing efforts, our business, financial condition and results of operations may be adversely affected.
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As a result, our results of operations could suffer due to:
−Removed: • any decline in demand for our platform;
+Added: • any decline in demand for our platform, including as a result of reductions or delays in general customer engagement technology spending by our customers and potential customers in connection with a sustained general economic downturn;
• the failure of our platform to achieve continued market acceptance;
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We outsource substantially all the infrastructure relating to our cloud-based platform to third-party hosting providers and, as a result, our services may be impacted in the future, and have been impacted in the past, by unscheduled downtime at such providers that is beyond our control.
−Removed: Our revenue could be
−Removed: significantly affected if we suffer unscheduled downtime that exceeds the allowed downtimes under our agreements with our customers.
+Added: Our revenue could be significantly affected if we suffer unscheduled downtime that exceeds the allowed downtimes under our agreements with our customers.
Because of the large amount of data that we collect, process, transmit, store and manage, it is possible that hardware failures or errors in our systems could result in data loss or cause the information that we collect to be incomplete which may result in breach of contract claims, damage our reputation or subject us to regulatory fines or investigations.
−Removed: Furthermore, the availability or performance of our platform could be adversely affected by a number of factors outside our control, including customers’ inability to access the internet, the failure of software systems caused by our third-party vendors, security breaches, cyberattacks or variability in user traffic for our services.
+Added: Furthermore, the availability or performance of our platform could be adversely affected by a number of factors outside our control, including
+Added: customers’ inability to access the internet, the failure of software systems caused by our third-party vendors, security breaches, cyberattacks or variability in user traffic for our services.
For example, our customers access our platform through their internet service providers.
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Work-from-home arrangements resulting from, and continuing after, the COVID-19 pandemic may cause a lengthening of these sales cycles or a reduction in sales cycle win rates as we have historically benefited from using face-to-face selling techniques.
+Added: Additionally, to the extent there is a sustained general economic downturn resulting in delays or reductions in general customer engagement technology spending by large enterprise customers, we may experience an extension of our sales cycle with potential customers or a reduction in sales cycle win rates due to budgetary constraints.
Any delays in our sales cycles may cause a delay between increasing operating expenses for such sales efforts and, upon successful sales, the generation of corresponding revenue.
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Successfully maintaining and enhancing our brand will depend largely on the effectiveness of our marketing efforts, our ability to provide reliable products that continue to meet the needs of our customers at competitive prices, our ability to maintain our customers’ trust, our ability to continue to develop new functionality and use cases, and our ability to successfully differentiate our products and platform capabilities from competitive products.
+Added: If we are not able to effectively differentiate our platform and its capabilities from those of our competitors, we may experience difficulty in attracting new customers.
Our brand promotion activities may not generate customer awareness or yield increased revenue and, even if they do, any increased revenue may not offset the expenses we incur in building our brand.
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Our success will depend in part on our ability to manage this growth effectively.
−Removed: We will require significant capital
−Removed: expenditures and valuable management resources to grow without undermining our culture of innovation, teamwork and attention to customer success, which has been central to our growth so far.
+Added: We will require significant capital expenditures and valuable management resources to grow without undermining our culture of innovation, teamwork and attention to customer success, which has been central to our growth so far.
We intend to continue to expand our international operations in the future.
−Removed: For example, we recently announced our plans to expand our international operations to include offices in Canada and France.
+Added: For example, we have recently expanded our international operations to include subsidiaries in Canada and France.
Our expansion will continue to place a significant strain on our managerial, administrative, financial and other resources.
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It is important that we maintain a high level of customer services, integration services, technical support and satisfaction as we expand our business.
−Removed: As our customer base continues to grow and as our penetration with existing customers expands, we will need to expand our account management, customer service and other personnel.
−Removed: Failure to manage growth could result in difficulty or delays in launching our platform, declines in quality or customer satisfaction, increases in costs, difficulties in introducing new features, or other operational difficulties.
+Added: As our customer base continues to grow and as our penetration within existing customers expands, we will need to expand our account management, customer service and other personnel.
+Added: Failure to manage growth could result in difficulty or delays in launching our platform, declines in quality or customer satisfaction, increases in costs, difficulties in
+Added: introducing new features, or other operational difficulties.
Any of these could adversely impact our business, financial condition and results of operations.
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Competition for these personnel is intense, especially for experienced software engineers and senior sales executives.
−Removed: In addition, partially in response to the COVID-19 pandemic, we have a large, remote workforce, which adds to the complexity and costs of our business operations.
+Added: In addition, as a result of our hybrid work model, called “The Way Braze Works,” we have a large, remote workforce, which adds to the complexity and costs of our business operations.
We expect to continue to experience difficulty in hiring and retaining employees with appropriate qualifications.
−Removed: Additional stay-at-home, business closure and other restrictive orders may also impact our ability to identify, hire and train new personnel.
−Removed: We recently completed our initial public offering, and potential candidates may not perceive our compensation package, including our equity awards, as favorably as employees hired prior to our initial public offering.
+Added: We implemented our hybrid work model in September 2022, and it may also impact our ability to identify, hire and train new personnel.
+Added: We also completed our initial public offering in November 2021, and potential candidates may not perceive our compensation package, including our equity awards, as favorably as employees hired prior to our initial public offering.
In addition, our recruiting personnel, methodology and approach may need to be altered to address a changing candidate pool and profile.
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Also, it is not uncommon for companies to see significant turnover in their workforce following an initial public offering, a trend which may only be further amplified by the competitive market for highly-skilled employees.
−Removed: If we fail to attract new personnel, experience significant turnover or the loss of key
−Removed: personnel or fail to retain and motivate our current personnel, it could adversely affect our business and future growth prospects.
+Added: If we fail to attract new personnel, experience significant turnover or the loss of key personnel or fail to retain and motivate our current personnel, it could adversely affect our business and future growth prospects.
Further, many of the companies with which we compete for experienced personnel have greater resources than we have.
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We may find it difficult to maintain these important aspects of our culture and core values.
−Removed: In addition, the growth of our remote workforce, partially in response to the COVID-19 pandemic, may impact our ability to preserve our culture and core values.
+Added: In addition, the growth of our remote workforce may impact our ability to preserve our culture and core values.
Any failure to preserve our culture or core values could negatively affect our future success, including our ability to retain and recruit personnel, and to effectively focus on and pursue our corporate objectives.
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A component of our growth strategy involves the further expansion of our operations and customer base internationally.
−Removed: We currently have customers in the United States, Canada, Europe, the Middle East, the Asia-Pacific region and Latin America.
+Added: We currently have customers in North America, Europe, the Middle East, the Asia-Pacific region and Latin America.
We are continuing to adapt and develop strategies to address international markets, but such efforts may not be successful.
−Removed: In addition, the ongoing COVID-19 pandemic, including the emergence of new variant strains COVID-19, and related stay-at-home, business closure and other restrictive orders and travel restrictions into and outside the United States, may pose additional challenges for international expansion and may impact our ability to launch new locations and further expand geographically.
+Added: In addition, any future stay-at-home, business closure and other restrictive orders and travel restrictions into and outside the United States as a result of the emergence of new variant strains of COVID-19 or any other highly infectious disease, if any, may pose additional challenges for international expansion and may impact our ability to launch new locations and further expand geographically.
We expect that our international activities will continue to grow over the foreseeable future as we continue to pursue opportunities in existing and new international markets.
−Removed: For example, we previously announced our plans to expand our international operations to include offices in Canada and France.
+Added: For example, we recently expanded our international operations to include subsidiaries in Canada and France.
This and any other future expansion of our international activities and operations will require significant management attention and financial resources.
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• more stringent regulations relating to privacy and data security and the unauthorized collection, processing, transmission or use of, or access to, commercial and personal information, particularly in Europe;
−Removed: • differing labor regulations, especially in Canada and Europe, where labor laws are generally more advantageous to employees as compared to the United States, including deemed hourly wage and overtime regulations in these locations;
+Added: • differing labor regulations, especially in regions where labor laws are generally more advantageous to employees as compared to the United States, including deemed hourly wage and overtime regulations in some of these locations;
• difficulties in managing a business in new markets with diverse cultures, languages, customs, legal systems, alternative dispute systems and regulatory systems;
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domestic bribery statute contained in 18 U.S.C.
−Removed: § 201, the U.S.
Travel Act, the U.K.
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If we invest substantial time and resources to expand our international operations and are unable to do so successfully, our business, financial condition and results of operations may be adversely affected.
+Added: We have a limited history of operating with a substantial remote workforce and the long-term impact of this workplace arrangement on our financial results and business operations is uncertain.
+Added: In September 2022, we implemented our hybrid work model, called “The Way Braze Works,” pursuant to which each department may choose to have its employees function primarily as in-person, remote or hybrid workers.
+Added: We have also hired a large number of employees who are permanently remote, regardless of their department’s determination.
+Added: As a result, remote work has become the primary experience for a large number of our employees, and our intention is for our workforce to continue to have remote work opportunities into the future.
+Added: However, we have a limited history of operating with a large remote workforce and, while we anticipate that implementing The Way Braze Works will have a long-term positive impact on our financial results and business operations, the impact remains uncertain, particularly in the near term.
+Added: Additionally, there is no guarantee that we will realize any anticipated benefits to our business, including any cost savings, operational efficiencies or productivity.
+Added: Our continuing shift to hybrid and remote work may make it increasingly difficult to manage our business and adequately oversee our employees and business functions, potentially resulting in harm to our company culture, increased employee attrition, the loss of key personnel, difficulty in properly classifying employees and a potentially negative impact on product research and development, and the growth of our business.
+Added: We may also experience an increased risk of privacy and data security breaches and incidents involving our or our customers’ data as a result of the decentralization of the technology used to operate our business.
+Added: The mobility of our remote workers may also subject us to an increased risk of regulatory claims if our remote employees establish a nexus for our business in unanticipated jurisdictions.
+Added: This could cause us to be subject to tax and employment claims in the applicable jurisdiction.
+Added: Any of these factors could adversely affect our financial condition and operating results.
Acquisitions, strategic investments, partnerships or alliances could be difficult to identify, pose integration challenges, divert the attention of management, disrupt our business, dilute stockholder value and adversely affect our business, financial condition and results of operations.
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Our brand, reputation and ability to attract new customers depend on the reliable performance of our technology infrastructure and content delivery.
−Removed: Our platform engages with consumers through emails, SMS, mobile and web notifications.
−Removed: We are dependent on third-party services for delivery of emails and SMS, and we are dependent on Apple services and Google services for delivery of mobile and web notifications.
−Removed: For example, unrelated third parties are utilized throughout our industry to deliver email and SMS messages to consumers.
−Removed: If these third-party services change their policies regarding the delivery of certain email or SMS messages, some of our customers may no longer be able to use these channels through our platform.
+Added: Our platform engages with consumers through emails, SMS/MMS, mobile and web notifications (among other channels).
+Added: We are dependent on third-party services for delivery of emails and SMS/MMS, and we are dependent on Apple services and Google services for delivery of mobile and web notifications.
+Added: For example, unrelated third-parties are utilized throughout our industry to deliver email and SMS/MMS messages to consumers.
+Added: If these third-party services change their policies regarding the delivery of certain email or SMS/MMS messages, some of our customers may no longer be able to use these channels through our platform.
+Added: Further, if any of these third-party providers were to suffer extended service outages, then our customers may not be able to deliver email and SMS/MMS messages using our platform.
If this were to occur, it could lead to customer dissatisfaction, harm to our reputation or subject us to liability, any of which may harm our business, financial condition and results of operations.
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A prolonged disruption, cybersecurity event or any other negative event affecting Apple or Google could lead to customer dissatisfaction and could in turn damage our reputation with current and potential customers, expose us to liability and cause us to lose customers or otherwise harm our business, financial condition and results of operations.
+Added: We will also face similar risks as we add new channels to our platform that are supported by third-parties if such third-parties were to face similar challenges or disruptions with regard to their respective channels.
We depend in part on mobile operating systems, such as Android and iOS, and their respective infrastructures, to send notifications through various applications that utilize our platform.
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As new mobile devices and mobile, web and email platforms are released, there is no guarantee that these mobile devices and platforms will continue to support our platform or effectively roll out updates to our customers’ applications.
−Removed: The parties that control the operating systems for mobile devices and mobile, web and email platforms have no obligation to test the interoperability of new mobile devices or platforms with our platform, and third parties may produce new products that are incompatible with or not optimal for the operation of our platform.
+Added: The parties that control the operating systems for mobile devices and mobile, web and email platforms.
+Added: have no obligation to test the interoperability of new mobile devices or platforms with our platform, and third-parties may produce new products that are incompatible with or not optimal for the operation of our platform.
Additionally, in order to deliver high-quality customer engagement, we need to ensure that our platform is designed to work effectively with a range of mobile technologies, systems, networks and standards.
−Removed: If consumers choose to use products or platforms that do not support our platforms, or if we do not ensure our platform can work effectively with such products or platforms, our business and growth could be harmed.
+Added: If consumers choose to use products or platforms that do not support our platform, or if we do not ensure our platform can work effectively with such products or platforms, our business and growth could be harmed.
We also may not be successful in developing or maintaining relationships with key participants in the mobile industry that permit such interoperability.
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We outsource substantially all the infrastructure relating to our cloud-based platform to third-party hosting providers.
−Removed: Our customers need to be able to access our platform at any time, without interruption or degradation of performance, and we provide them with service-level commitments with respect to uptime and, occasionally, throughput.
+Added: Our customers need to be able to access our platform at any time, without interruption or degradation of performance, and we provide many of them with service-level commitments with respect to uptime and, occasionally, throughput.
Our products depend on protecting the virtual cloud infrastructure hosted by third-party hosting providers by maintaining its configuration, architecture, features and interconnection specifications, as well as the information stored in these virtual data centers, which is transmitted by third-party internet service providers.
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Each provider’s respective facilities may be vulnerable to damage or interruption from earthquakes, hurricanes, floods, fires, cybersecurity attacks, terrorist attacks, power losses, telecommunications failures and other events beyond our or their control.
−Removed: In the event that AWS’s or any other third-party provider’s systems or service abilities are hindered by any of the events
−Removed: discussed above, our ability to operate our platform may be impaired, our customers may be impacted, we may be subject to claims for refunds or terminations under our contracts, and our reputation and brand may be harmed.
+Added: In the event that AWS’s or any other third-party provider’s systems or service abilities are hindered
+Added: by any of the events discussed above, our ability to operate our platform may be impaired, our customers may be impacted, we may be subject to claims for refunds or terminations under our contracts, and our reputation and brand may be harmed.
A decision to close these facilities without adequate notice, or other unanticipated problems, could result in lengthy interruptions to our platform.
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Additionally, AWS or other cloud providers may experience threats or attacks from computer malware, ransomware, viruses, social engineering (including phishing attacks), denial of service or other attacks, employee error, theft or misuse and general hacking, including from state-sponsored or criminal hacking groups, which have become more prevalent in our industry.
−Removed: Any of these security incidents could result in unauthorized access or damage to, or the disablement, encryption, use or misuse, disclosure, modification, destruction or loss of our data or our partners’ data, including personal information, or disrupt our ability to provide our platform or service.
+Added: Any of these security incidents could result in unauthorized access or damage to, or the disablement, encryption, use or misuse, disclosure, modification, destruction or loss of our data or our partners’ data, including personal information, or disrupt our ability to provide our platform or services.
Our platform’s continuing and uninterrupted performance is critical to our success.
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Changes to mobile device operating systems may diminish the usefulness of marketing providers or require significant modifications or demands on our business to continue supporting those operating systems.
−Removed: Changes to developer platform policies related to third-party software, such as Apple or Google, creating restrictions that limit the ability of our existing or potential customers to use SDKs or that further limit the use of cookies could similarly adversely affect our business.
+Added: Changes to developer platform policies related to third-party software, such as Apple or
+Added: Google, creating restrictions that limit the ability of our existing or potential customers to use SDKs or that further limit the use of cookies could similarly adversely affect our business.
If we are unsuccessful in establishing or maintaining our relationships with third-parties, our ability to compete in the marketplace or to grow our revenue could be impaired and our business, financial condition and results of operations may suffer.
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The CCPA allows for statutory fines for noncompliance (up to $7,500 per violation).
−Removed: In addition, it is anticipated that the CPRA, effective January 1, 2023, will expand the CCPA.
−Removed: For example, the CPRA establishes a new California Privacy Protection Agency to implement and enforce the CCPA (as amended), which could increase the risk of an enforcement action.
+Added: The CCPA authorized the establishment of the regulator, the CPPA, which increases the risk of an enforcement action.
Other states have enacted data privacy laws.
−Removed: For example, Virginia passed the Consumer Data Protection Act, and Colorado passed the Colorado Privacy Act, both of which differ from the CPRA and become effective in 2023.
−Removed: If we become subject to new data privacy laws at the state level, the risk of enforcement action against us could increase because we may become subject to additional obligations, and the number of individuals or entities that can initiate actions against us may increase (including individuals, via a private right of action, and state actors).
+Added: Virginia, Colorado, Connecticut and Utah have all passed data privacy laws that become effective in 2023.
+Added: If we become subject to further new data privacy laws at the state level, the risk of enforcement action against us could increase because we may become subject to additional obligations, and the number of individuals or entities that can initiate actions against us may increase (including individuals, via a private right of action, and state actors).
Outside the United States, an increasing number of laws, regulations, and industry standards apply to data privacy and security.
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Under the EU GDPR, government regulators may impose temporary or definitive bans on data processing, as well as fines of up to 20 million euros or 4% of annual global revenue, whichever is greater.
−Removed: Further, individuals may initiate litigation related to our processing of their personal data.
−Removed: In Canada, the Personal Information Protection and Electronic Documents Act, or PIPEDA, and various related provincial laws, as well as Canada’s Anti-Spam Legislation, or CASL, also apply to our operations.
+Added: Furthermore, individuals may initiate litigation related to our processing of their personal data.
+Added: In Canada, the Personal Information Protection and Electronic Documents Act and various related provincial laws, as well as Canada’s Anti-Spam Legislation also apply to our operations.
In addition, many jurisdictions have enacted data localization laws and cross-border personal data transfer laws.
These laws may make it more difficult for us to transfer personal data across jurisdictions, which could impede our business.
−Removed: For example, absent appropriate safeguards or other circumstances, the EU GDPR generally restricts the transfer of personal data to
−Removed: countries outside of the EEA, such as the United States, which the European Commission does not consider providing an adequate level of data privacy and security.
−Removed: The European Commission released a set of “Standard Contractual Clauses” that are designed to be a valid mechanism by which entities can transfer personal data out of the EEA to jurisdictions that the European Commission has not found to provide an adequate level of protection.
−Removed: Currently, these Standard Contractual clauses are a valid mechanism to transfer personal data outside of the EEA.
−Removed: The Standard Contractual Clauses, however, require parties that rely upon that legal mechanism to comply with additional obligations, such as conducting transfer impact assessments to determine whether additional security measures are necessary to protect the personal data being transferred.
−Removed: Moreover, due to potential legal challenges, there exists some uncertainty regarding whether the Standard Contractual Clauses will remain a valid mechanism for transfers of personal data out of the EEA.
−Removed: In addition, laws in Switzerland and the U.K.
−Removed: similarly restrict transfers of personal data outside of those jurisdictions to countries such as the United States that do not provide an adequate level of personal data protection.
+Added: For example, following the Schrems II decision of the European Court of Justice in July 2020, absent appropriate safeguards or other circumstances, the EU GDPR generally restricts the transfer of personal data to countries outside of the EU, such as the United States, which the European Commission does not believe provides an adequate level of data privacy and security protections.
+Added: The European Commission released a set of updated “Standard Contractual Clauses,” in 2021, the 2021 SCCs, that are designed to be a valid mechanism by which entities can transfer personal data out of the EU to non-adequate countries.
+Added: While these 2021 SCCs are currently viewed as a valid mechanism to transfer personal data outside of the EU, the authorities have also stated that the party transferring data (the “data exporter”) from the EU to a jurisdiction without an adequate data protection regulatory environment, must be satisfied that the party receiving the personal data (the “data importer”) has in place sufficient “supplementary measures” to protect the personal data, including from access from sovereign states, in addition to the 2021 SCCs.
+Added: Various legal challenges throughout Europe have questioned what are acceptable “supplementary measures” that would allow data importers and data exporters to validly rely on the 2021 SCCs and sufficiently protect the data from public
+Added: This emerging case law sets a very high standard for acceptable supplementary measures.
+Added: It is therefore possible that the supplementary measures we have implemented will not be deemed to be adequate.
+Added: The validity of relying on the 2021 SCCs as a transfer mechanism is expected to be the subject of further litigation in the EU.
+Added: The EU and US are in discussions to facilitate the flows of personal data across these borders, which has resulted in the EU-U.S.
+Added: Data Privacy Framework.
+Added: At this time, the European Commission has launched the process to adopt an adequacy decision for the EU-U.S.
+Added: but there are several rounds of approval that must be passed for the adequacy decision to come into effect.
+Added: Other jurisdictions around the world are also developing their own unique set of restrictions and mechanisms to allow cross border data flows.
+Added: For instance, in March 2022, the U.K.
+Added: adopted both its own “International Data Transfer Agreement” and a “UK Addendum” to the 2021 SCCs as the valid transfer mechanism for sending U.K.
+Added: personal data to those countries that the U.K.
+Added: does not recognize as providing an adequate level of protection, such as the United States.
In addition to European restrictions on cross-border transfers of personal data, other jurisdictions have enacted or are considering similar cross-border personal data transfer laws and local personal data residency laws, any of which could increase the cost and complexity of doing business in those jurisdictions.
−Removed: If we cannot implement a valid compliance mechanism for cross-border privacy and security transfers, we may face increased exposure to regulatory actions, substantial fines, and injunctions against processing or transferring personal data from Europe or elsewhere.
+Added: If we cannot implement a workable, valid compliance mechanism for cross-border privacy and security transfers, we may face increased exposure to regulatory actions, substantial fines, and injunctions against processing or transferring personal data from Europe or elsewhere.
The inability to import personal data to the United States could significantly and negatively impact our business operations, including by limiting our ability to offer our full range of services in Europe and elsewhere;
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Any of these events could have a material adverse effect on our reputation, business, or financial condition, including, but not limited to, loss of customers, interruptions or stoppages in our business operations, inability to process personal data or to operate in certain jurisdictions, limited ability to develop or commercialize our products, expenditure of time and resources to defend any claim or inquiry, adverse publicity or revision or restructuring of our operations.
+Added: Operating our business and platform involves the collection, use, processing, storage, transfer and sharing of sensitive, proprietary, confidential, regulated and personal information, including such information that we handle on behalf of our customers.
+Added: These activities subject us to numerous data privacy and security obligations, such as various laws, regulations, guidance, industry standards, external and internal privacy and security policies, contracts, and other obligations that govern the processing of personal data by us and on our behalf.
If we or our third-party service providers experience a security breach or unauthorized parties otherwise obtain access to our customers’ data, our data or our platform, our solution may be perceived as not being secure, our reputation may be harmed, demand for our platform and products may be reduced and we may incur significant liabilities.
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In addition to traditional computer “hackers,” threat actors, personnel (such as through theft or misuse), sophisticated nation-states, and nation-state-supported actors now engage in cyberattacks, including, without limitation, nation-state actors for geopolitical reasons and in conjunction with military conflicts and defense activities.
−Removed: We may be subject to a variety of evolving threats, including but not limited to social-engineering attacks (including through phishing attacks), malicious code (such as viruses and worms), malware (including as a result of advanced persistent threat intrusions), denial-of-service attacks (such as credential stuffing), personnel misconduct or error, ransomware attacks, supply-chain attacks, software bugs, server malfunctions, software or hardware failures, loss of data or other information technology assets, adware, telecommunications failures, earthquakes, fires, floods, and other similar threats.
+Added: We may be subject to a variety of evolving threats, including, but not limited to, social-engineering attacks (including through phishing, vishing and hybrid phishing attacks), malicious code (such as viruses and worms), malware (including as a result of advanced persistent threat intrusions), denial-of-service attacks (such as credential stuffing), personnel misconduct or error, ransomware attacks, supply-chain attacks, software bugs, server malfunctions, software or hardware failures, loss of data or other information technology assets, adware, telecommunications failures, earthquakes, fires, floods, and other similar threats.
+Added: Additionally, our customers have been and may be in the future, targeted by similar cyberthreats, and bad actors have accessed, and may in the future, access our platform and services using such customer’s credentials.
+Added: Accordingly, the failure of our customers to use appropriate cybersecurity technology and practices can
+Added: result in unauthorized parties breaching or otherwise obtaining access to our platform and customer data.
Ransomware attacks, including those perpetrated by organized criminal threat actors, nation-states, and nation-state-supported actors, are becoming increasingly prevalent and severe and can lead to significant interruptions in our operations, loss of data and income, reputational harm, and diversion of funds.
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Additionally, the risk of these threats may increase for us and our third-party service providers due to ongoing international instability.
−Removed: In the past, nation-states have sponsored cybersecurity attacks against private companies in response to U.S.
+Added: In the past, nation-states have sponsored cyberattacks against private companies in response to U.S.
governmental actions or for other strategic purposes.
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Moreover, we or our third-party service providers may be more vulnerable to such attacks in remote work environments, which have increased in response to the COVID-19 pandemic and will likely continue into the foreseeable future.
−Removed: If we or our third-party service providers suffer, or are perceived to have suffered, a security breach or other security incident, we may experience adverse consequences.
+Added: If we, our customers or our third-party service providers suffer, or are perceived to have suffered, a security breach or other security incident, we may experience adverse consequences.
Applicable data privacy and security obligations may require us to notify relevant stakeholders of security incidents.
Such disclosures are costly, and the disclosures or the failure to comply with such requirements could lead to adverse consequences.
−Removed: If we (or a third party upon whom we rely) experience a security incident or are perceived to have experienced a security incident, we may experience adverse consequences.
+Added: If we, our customers or a third party upon whom we rely experience a security incident or are perceived to have experienced a security incident, we may experience adverse consequences.
These consequences may include, but are not limited to, government enforcement actions (for example, investigations, fines, penalties, audits, and inspections), additional reporting requirements or oversight, restrictions on processing data (including personal data), litigation (including class action claims), indemnification obligations, negative publicity, reputational harm, monetary fund diversions, interruptions in our operations (including availability of data to us and our customers), financial loss and other similar harms.
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In addition, the use of the internet as a business tool could be adversely affected due to delays in the development or adoption of new standards and protocols to handle increased demands of internet activity, security, reliability, cost, ease of use, accessibility and quality of service.
−Removed: The performance of the internet and its acceptance as a business tool have been adversely affected by “viruses,” “worms” and similar malicious programs, along with distributed denial of service and similar attacks.
+Added: The performance of the internet and its acceptance as a business tool have been adversely
+Added: affected by “viruses,” “worms” and similar malicious programs, along with distributed denial of service and similar attacks.
As a result, the internet has experienced a variety of outages and other delays as a result of such damage to or attacks on portions of its infrastructure.
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These encryption products and the underlying technology are currently considered “publicly available” by the Export Administration Regulations and may be exported outside of the United States.
−Removed: However, if they cease to be considered “publicly available,” then these encryption products and underlying technology may be exported outside of the United States only with the required export authorizations, including by license, a license exception or other appropriate government authorizations.
+Added: However, if they cease to be considered “publicly available,” then these encryption products and underlying technology may be exported outside of the United States
+Added: only with the required export authorizations, including by license, a license exception or other appropriate government authorizations.
Furthermore, our activities are subject to U.S.
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Additionally, U.S.
−Removed: embargoes and sanctions can change rapidly and unpredictably in response to international events, such as the recent application of new and broad sanctions against Russia and Belarus in connection with the invasion of Ukraine.
+Added: embargoes and sanctions can change rapidly and unpredictably in response to international events, such as the application of new and broad sanctions against Russia and Belarus in connection with the invasion of Ukraine.
Future embargoes or sanctions could have a significant impact on our business or the business of our customers, either of which could have a material adverse effect on our financial results and operations.
Violations of U.S.
−Removed: sanctions or export control laws can result in significant fines or penalties and possible incarceration for responsible employees and managers could be imposed for criminal violations of these laws.
+Added: sanctions or export control laws can result in incarceration for responsible employees and managers or the imposition of significant fines or penalties.
If our partners fail to obtain appropriate import, export or re-export licenses or permits, we may also be adversely affected through reputational harm as well as other negative consequences, including government investigations and penalties.
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A lack of future taxable income would adversely affect our ability to utilize NOLs incurred in tax years beginning on or before December 31, 2017, before they expire.
−Removed: In general, under Section 382 of the Internal Revenue Code of 1986, as amended, or the Code, a corporation that undergoes an “ownership change” (which generally is defined under Section 382 of the Code and applicable Treasury Regulations as a greater than 50%
−Removed: change, by value, in its equity ownership over a three-year period) is subject to limitations on its ability to utilize its pre-change NOLs to offset future taxable income.
−Removed: We have experienced ownership changes in the past and we may experience a future ownership change under Section 382 of the Code that could affect our ability to utilize the NOLs to offset our income, some of which may be outside of our control.
+Added: In general, under Section 382 of the Internal Revenue Code of 1986, as amended, the IRC or the Code, a corporation that undergoes an “ownership change” (which generally is defined under Section 382 of the Code and applicable Treasury Regulations as a greater than 50% change, by value, in its equity ownership over a three-year period) is subject to limitations on its ability to utilize its pre-change NOLs to offset future taxable income.
+Added: We have experienced ownership changes in the past and we may experience a future ownership change under Section 382 of the Code that could affect our ability to utilize the NOLs to offset
+Added: our income, some of which may be outside of our control.
Furthermore, our ability to utilize NOLs of companies that we have acquired or may acquire in the future may be subject to limitations.
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et al, or Wayfair, that online sellers can be required to collect sales and use tax despite not having a physical presence in the buyer’s state.
−Removed: In response to Wayfair, or otherwise, state or local governments may adopt, or begin to enforce, laws requiring us to calculate, collect and remit taxes on sales in their jurisdictions.
+Added: In response to Wayfair, or otherwise, state or local governments have adopted and may continue to adopt, or begin to enforce, laws requiring us to calculate, collect and remit taxes on sales in their jurisdictions.
In addition, we are subject to indirect taxes in foreign jurisdictions, such as value-added tax and goods and services tax, in connection with certain foreign sales transactions.
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In addition, integration of the third-party software used in our software with new third-party software may require significant work and require substantial investment of our time and resources, or require downtime affecting our service level commitments.
−Removed: Also, any undetected errors or defects, or security vulnerabilities, in third-party software could prevent the deployment or impair the functionality of our software, delay new updates or enhancements to our platform, result in a failure of our platform and injure our reputation.
+Added: Also, any undetected errors, defects or security vulnerabilities in third-party software could prevent the deployment or impair the functionality of our software, delay new updates or enhancements to our platform, result in a failure of our platform and injure our reputation.
We use open-source software in our products, which could negatively affect our ability to sell our services or subject us to litigation or other actions.
We use open-source software in our products, and we expect to continue to incorporate open-source software in our services in the future.
−Removed: Few of the licenses applicable to open-source software have been interpreted by courts, and there is a risk that these licenses could be construed in a manner that could impose unanticipated conditions or restrictions on our ability to commercialize our products or to maintain the confidentiality of our proprietary source code.
+Added: Few of the licenses applicable to open-source software have been interpreted by courts, and there is a risk
+Added: that these licenses could be construed in a manner that could impose unanticipated conditions or restrictions on our ability to commercialize our products or to maintain the confidentiality of our proprietary source code.
Moreover, we may encounter instances in which we have incorporated additional open-source software in our proprietary software in a manner that is inconsistent with the terms of the applicable license or our current policies and procedures.
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To safeguard these rights, we rely on a combination of patent, trademark, copyright and trade secret laws and contractual protections, all of which provide only limited protection and may not now or in the future provide us with a competitive advantage.
−Removed: As of January 31, 2022, we had 19 granted patents and seven p atents pending related to our platform and its technology.
+Added: As of January 31, 2023, we had 23 granted patents related to our platform and its technology and two p atent applications pending for examination in the United States and no non-U.S.
+Added: patents or patent applications pending.
Our patent applications may not result in the issuance of a patent, or the examination process may require us to narrow our claims.
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Further, the contractual provisions that we enter into may not prevent unauthorized use or disclosure of our proprietary technology or intellectual property rights and may not provide an adequate remedy in the event of unauthorized use or disclosure of our proprietary technology or intellectual property rights.
−Removed: Moreover, policing unauthorized use of our technologies, trade secrets and intellectual property is difficult, expensive and time-consuming, particularly in countries where the laws may not be as protective of intellectual property rights as those in the United States and where mechanisms for enforcement of intellectual property rights may be weak.
+Added: Moreover, policing unauthorized use of our technologies, trade secrets and intellectual property is difficult, expensive and time-consuming, particularly in countries where the laws may not be as
+Added: protective of intellectual property rights as those in the United States and where mechanisms for enforcement of intellectual property rights may be weak.
For instance, in response to U.S.
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In addition, we may in the future be subject to claims that employees or contractors, or we, have inadvertently or otherwise used or disclosed trade secrets or other proprietary information of our competitors or other parties.
−Removed: Because patent applications can take
−Removed: years to issue and are often afforded confidentiality for some period of time, there may currently be pending applications, unknown to us, that later result in issued patents that could cover one or more of our products.
+Added: Because patent applications can take years to issue and are often afforded confidentiality for some period of time, there may currently be pending applications, unknown to us, that later result in issued patents that could cover one or more of our products.
To the extent that intellectual property claims are made against our customers based on their usage of our technology, we have certain obligations to indemnify and defend such customers from those claims.
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Intellectual property claims could also result in our having to stop making, selling, offering for sale or using technology found to be in violation of a third party’s rights.
−Removed: We might be required to seek a license for the third-party intellectual property rights, which may not be available on reasonable terms or at all.
+Added: We might be required to seek a license for the third-party intellectual property rights, which may not be available on
+Added: reasonable terms or at all.
Even if a license is available to us, we may be required to pay significant upfront fees, milestone payments or royalties, which would increase our operating expenses.
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Our future revenue and results of operations could be harmed if the increases in demand we have seen from certain industries as a result of the COVID-19 pandemic fail to continue after the pandemic ends.
−Removed: In response to the COVID-19 pandemic, including the emergence of new variant strains of COVID-19, governments have instituted shelter-in-place orders, social distancing requirements, travel restrictions and similar measures to slow infection rates.
+Added: In response to the COVID-19 pandemic, including the emergence of new variant strains of COVID-19, governments previously instituted shelter-in-place orders, social distancing requirements, travel restrictions and similar measures to slow infection rates.
These restrictions have prompted shifts from physical commerce to ecommerce, from in-room dining to take out and delivery, from gyms to at home health and fitness and from the theaters to in-home media streaming services.
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We may also experience decreases or decreased growth rates in sales of new subscriptions to some of our customers, which would adversely affect our business, financial condition and results of operations.
−Removed: In light of the uncertain and rapidly evolving situation relating to the spread of COVID-19, in the past we have taken measures intended to help minimize the risk of the virus to our employees and the communities in which we participate, including promoting a remote work environment for our employees.
−Removed: While we have reopened many of our offices, a significant portion of our employees continue to work remotely.
+Added: In light of the uncertain and rapidly evolving situation relating to the spread of COVID-19, in the past we have taken measures intended to help minimize the risk of the virus to our employees and the communities in which we participate,
+Added: including promoting a remote work environment for our employees.
+Added: While we have reopened many of our offices, a significant portion of our employees continue to work remotely under our hybrid work model.
We have a distributed workforce and our employees are accustomed to working remotely and working with others who are working remotely.
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For instance, due to the prior emergence of variant strains of COVID-19, we had to previously alter our office reopening plans and modified or cancelled anticipated events.
−Removed: If a new variant strain of COVID-19 were to arise, we might be forced to take similar actions again in the future.
−Removed: Further, the emergence of new variant strains of COVID-19 could also adversely affect workforces, economies and financial markets globally, potentially leading to an economic downturn and a reduction in customer spending on our products or an inability for our customers, partners, suppliers or vendors or other parties with whom we do business to meet their contractual obligations.
−Removed: While it is not possible at this time to predict the duration and extent of the impact that COVID-19 or the emergence of new variant strains of COVID-19 could have on worldwide economic activity and our business in particular, the continued spread of COVID-19, especially in light of the emergence of new variant strains of COVID-19, the timing, distribution, rate of public acceptance and efficacy of vaccines and other treatments, and the measures taken by governments, businesses and other organizations in response to COVID-19 could adversely impact our business, financial condition and results of operations.
−Removed: Moreover, to the extent the COVID-19 pandemic adversely affects our business, financial condition, and results of operations, it may also have the effect of heightening many of the other risks described in this “Risk Factors” section, including, but not limited to, those related to our ability to expand within our existing customer base, acquire new customers, develop and expand our sales and marketing capabilities, and expand internationally.
−Removed: Natural catastrophic events and human-made problems such as power disruptions, computer viruses, global pandemics, data security breaches and terrorism may disrupt our business.
+Added: If a new variant strain of COVID-19 or another highly infectious disease were to arise, we might be forced to take similar actions again in the future.
+Added: Further, the emergence of new variant strains of COVID-19 or other highly infectious diseases could also adversely affect workforces, economies and financial markets globally, potentially leading to an economic downturn and a reduction in customer spending on our products or an inability for our customers, partners, suppliers or vendors or other parties with whom we do business to meet their contractual obligations.
+Added: While it is not possible at this time to predict the duration and extent of the impact that COVID-19, the emergence of new variant strains of COVID-19 or any other highly infectious disease could have on worldwide economic activity and our business in particular, the continued spread of COVID-19, especially in light of the emergence of new variant strains of COVID-19, the timing, distribution, rate of public acceptance and efficacy of vaccines and other treatments, and the measures taken by governments, businesses and other organizations in response to COVID-19 or any other highly infectious disease could adversely impact our business, financial condition and results of operations.
+Added: Moreover, to the extent the COVID-19 pandemic or any other future health pandemic adversely affects our business, financial condition, and results of operations, it may also have the effect of heightening many of the other risks described in this “Risk Factors” section, including, but not limited to, those related to our ability to expand within our existing customer base, acquire new customers, develop our sales and marketing capabilities, and expand internationally.
+Added: Natural catastrophic events and human-made problems such as climate change, power disruptions, computer viruses, global pandemics, data security breaches and terrorism may disrupt our business.
We rely heavily on our network infrastructure and information technology systems for our business operations.
−Removed: An online attack, damage as a result of civil unrest, earthquake, fire, terrorist attack, power loss, global pandemics (such as the COVID-19 pandemic, including the emergence of new variant strains of COVID-19), telecommunications failure or other similar catastrophic event could cause system interruptions, delays in accessing our service, reputational harm and loss of critical data.
+Added: An online attack, damage as a result of civil unrest, earthquake, fire, terrorist attack, power loss, global pandemics (such as the COVID-19 pandemic, including the emergence of new variant strains of COVID-19), telecommunications failure, climate change-related events or other similar catastrophic event could cause system interruptions, delays in accessing our service, reputational harm and loss of critical data.
Such events could prevent us from providing our platform and products to our customers.
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In addition, many companies that provide cloud-based services have reported a significant increase in cyberattack activity since the beginning of the COVID-19 pandemic.
−Removed: Risks Related to Being a Public Company
−Removed: We are an “emerging growth company,” and we cannot be certain if the reduced reporting and disclosure requirements applicable to emerging growth companies will make our Class A common stock less attractive to investors.
−Removed: We are an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act, and we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including the auditor attestation requirements of Section 404, or Section 404, of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
−Removed: Pursuant to Section 107 of the JOBS Act, as an emerging growth company, we have elected to use the extended transition period for complying with new or revised accounting standards until those standards would otherwise apply to private companies.
−Removed: As a result, our consolidated financial statements may not be comparable to the financial statements of issuers who are required to comply with the effective dates for new or revised accounting standards that are applicable to public companies, which may make our Class A common stock less attractive to investors.
−Removed: In addition, if we cease to be an emerging growth company, we will no longer be able to use the extended transition period for complying with new or revised accounting standards.
−Removed: We will remain an emerging growth company until the earliest of (1) the last day of the fiscal year following the fifth anniversary of our initial public offering, (2) the last day of the first fiscal year in which our annual gross revenue is $1.07 billion or more, (3) the date on which we have, during the previous rolling three-year period, issued more than $1 billion in non-convertible debt securities and (4) the last day of the fiscal year in which the market value of our Class A common stock held by non-affiliates exceeded $700 million as of July 31 of such fiscal year.
−Removed: We cannot predict if investors will find our Class A common stock less attractive if we choose to rely on these exemptions.
−Removed: For example, if we do not adopt a new or revised accounting standard as a result of our election to use the extended transition period, our future results of operations may not be as comparable to the results of operations of certain other companies in our industry that adopted such standards.
−Removed: If some investors find our Class A common stock less attractive as a result, there may be a less active trading market for our Class A common stock, and our share price may be more volatile.
−Removed: We have identified three material weaknesses in our internal control over financial reporting, and if we are unable to achieve and maintain effective internal control over financial reporting, the accuracy and timing of our financial reporting may be adversely affected.
+Added: Further, events outside of our control, including natural disasters, climate change-related events, pandemics (such as the COVID-19 pandemic) or health crises may arise from time to time and be accompanied by governmental actions.
+Added: Any such events and responses, including regulatory developments, may cause significant volatility and declines in the global markets, disproportionate impacts to certain industries or sectors, disruptions to commerce (including to economic activity, travel and supply chains), loss of life and property damage, and may materially and adversely affect the global economy or capital markets, as well as our business and results of operations.
+Added: Risks Related to Public Company Reporting
+Added: We have an unremediated material weakness in our internal control over financial reporting, and if we are unable to achieve and maintain effective internal control over financial reporting, the accuracy and timing of our financial reporting may be adversely affected.
Prior to our initial public offering, we were a private company with limited accounting personnel and other resources with which to address our internal controls and procedures.
−Removed: In connection with the audits and preparation of our consolidated financial statements, we identified three material weaknesses in our internal controls, one over the financial statement close process specifically related to insufficient written policies and procedures for accounting and financial reporting and related controls, and the second over the lack of properly designed controls related to accounting for revenue recognition in accordance with standards under Accounting Standards Codification Topic 606, Revenue from Contracts with Customers, and the third related to our inadequate information technology controls for systems that are relevant to the preparation of financial statements.
−Removed: A “material weakness” is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
−Removed: We are working to remediate these material weaknesses through the development and implementation of processes and controls over the financial reporting process.
−Removed: Specifically, we have:
−Removed: • invested in and continue to hire additional internal resources with appropriate knowledge and expertise to effectively operate financial reporting processes and internal controls;
−Removed: • engaged external resources to assist with the remediation efforts and internal control execution, including the development of policies and procedures in certain areas;
−Removed: • begun adopting new information security policies and procedures, including training for users to further educate them on best practices for information security procedures;
−Removed: • begun developing program change management controls to ensure that IT program and data changes affecting financial IT applications and underlying accounting records are authorized and implemented appropriately;
−Removed: • begun developing financial application user access controls designed to ensure appropriate segregation of duties, restriction and privileges to personnel;
−Removed: • begun developing computer operations controls designed to ensure system interfaces and batch jobs process completely and accurately;
−Removed: • begun training application users to further educate them on best practices for information security procedures;
−Removed: • implemented a revenue recognition system designed to reduce the number of manual controls required to recognize revenue.
−Removed: We will also continue to invest in financial operations and reporting applications on an ongoing basis.
−Removed: While we have designed and are implementing new controls to remediate these material weaknesses, they have not been in operation for a sufficient period of time to demonstrate that the material weaknesses have been remediated.
−Removed: We cannot assure you that the measures we have taken to date will be sufficient to remediate the material weaknesses we identified or avoid the identification of additional material weaknesses in the future.
−Removed: If the steps we take do not remediate the material weaknesses in a timely manner, there could continue to be a reasonable possibility that our internal control deficiencies or others could result in a material misstatement of our financial statements that would not be prevented or detected on a timely basis.
+Added: In connection with the audit and preparation of our audited consolidated financial statements for the fiscal year ended January 31, 2023, we determined that our material weakness related to the lack of properly designed controls related to accounting for revenue recognition in accordance with standards under Accounting Standards Codification Topic 606, Revenue from Contracts with Customers , was unremediated as of January 31, 2023.
+Added: While we are working to remediate the material weakness through the development and implementation of processes and controls over the revenue process, they have not been in operation for a sufficient period of time to demonstrate that the
+Added: material weakness has been remediated.
+Added: We cannot assure you that the measures we have taken to date will be sufficient to remediate the material weakness we identified or avoid the identification of additional material weaknesses in the future.
+Added: If the steps we take do not remediate the material weakness in a timely manner, there could continue to be a reasonable possibility that our internal control deficiencies or others could result in a material misstatement of our financial statements that would not be prevented or detected on a timely basis.
As a public company, we are required to further design, document and test our internal control over financial reporting to comply with Section 404.
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Our Class B common stock has ten votes per share and our Class A common stock, which is the stock listed on the Nasdaq Global Select Market, has one vote per share.
−Removed: As a result, as of January 31, 2022, holders of our Class B common stock collectively beneficially owned, in the aggregate, shares representing approximately 97.6% of the voting power of our outstanding capital stock, and our executive officers, directors and holders of 5% or more of our common stock collectively beneficially owned, in the aggregate, outstanding shares representing approximately 76.3% of the total voting power of our outstanding capital stock.
−Removed: As a result, the holders of our Class B common stock, and in particular our executive officers, directors and holders of 5% or more of our common stock, will be able to exercise considerable influence over matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions, such as a merger or other sale of our company or our assets, even if their stock holdings represent less than 50% of the outstanding shares of our capital stock.
+Added: As a result, as of January 31, 2023, holders of our Class B common stock collectively beneficially owned, in the aggregate, shares representing approximately 84.8% of the voting power of our outstanding capital stock, and our executive officers, directors and holders of 5% or more of our common stock (by voting power) collectively beneficially owned, in the aggregate, outstanding shares representing approximately 87.0% of the total voting power of our outstanding capital stock.
+Added: As a result, the holders of our Class B common stock, and in particular our executive officers, directors and holders of 5% or more of our common stock (by voting power), will be able to exercise considerable influence over matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions, such as a merger or other sale of our company or our assets, even if their stock holdings represent less than 50% of the outstanding shares of our capital stock.
This concentration of ownership will limit the ability of other stockholders to influence corporate matters and may cause us to make strategic decisions that could involve risks to holders of our Class A common stock or that may not be aligned with the interests of holders of our Class A common stock.
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We cannot predict whether our dual class structure, combined with the concentrated control of certain stockholders, including our executive officers, employees and directors, investors and their affiliates, will result in a lower or more volatile market price of our Class A common stock or in adverse publicity or other adverse consequences.
−Removed: For example, certain index providers have announced restrictions on including companies with multiple class share structures in certain of their indexes.
+Added: For example, certain index
+Added: providers have announced restrictions on including companies with multiple class share structures in certain of their indexes.
In July 2017, FTSE Russell and Standard & Poor’s announced that they would cease to allow most newly public companies utilizing dual or multi-class capital structures to be included in their indices.
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These provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it more difficult for stockholders to replace members of our board of directors, which is responsible for appointing the members of our management.
−Removed: In addition, because we are incorporated in Delaware, we are governed by the
−Removed: provisions of Section 203 of the Delaware General Corporation Law, or DGCL, which generally, subject to certain exceptions, prohibits a Delaware corporation from engaging in any of a broad range of business combinations with any “interested” stockholder for a period of three years following the date on which the stockholder became an “interested” stockholder.
+Added: In addition, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporation Law, or DGCL, which generally, subject to certain exceptions, prohibits a Delaware corporation from engaging in any of a broad range of business combinations with any “interested” stockholder for a period of three years following the date on which the stockholder became an “interested” stockholder.
Any of the foregoing provisions could limit the price that investors might be willing to pay in the future for shares of our Class A common stock, and they could deter potential acquirers of our company, thereby reducing the likelihood that holders of our Class A common stock would receive a premium for their shares of our Class A common stock in an acquisition.
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We are unable to predict the effect that such sales may have on the prevailing market price of our Class A common stock.
−Removed: In connection with our initial public offering, all of our directors, executive officers and the holders of substantially all of our capital stock issued prior to our initial public offering are subject to lock-up agreements or agreements with market standoff provisions that restrict their ability to transfer shares until the earlier of (a) the commencement of trading on May 15, 2022 or (b) two full trading days following our second public release of quarterly or annual financial results (which for this purpose shall not include “flash” numbers or preliminary, partial earnings) following November 16, 2021, subject to certain exceptions.
−Removed: On January 5, 2022, 20% of the then outstanding securities (including shares of Class A common stock, stock options and other equity) held by our current and former employees, contractors, consultants an d advisors (excluding our directors, executive officers and individuals associated or affiliated with any of our institutional investors) were released from these transfer
−Removed: restrictions.
−Removed: These transfer restrictions will end with respect to all other securities that remain subject to these lock-up restrictions at the commencem ent of trading on April 4, 2022.
−Removed: All such securities will then become eligible for immediate sale in the public market, subject to trading limitations on shares held by our affiliates, or other limitations imposed by Rule 144 under the Securities Act, continued vesting of any unvested equity awards as of such date and our insider trading policies.
−Removed: As a result, a substantial number of shares of our Class A common stock will become eligible for sale in the public market in April 2022.
−Removed: We have registered all of our common stock issuable upon exercise of outstanding stock options, settlement of outstanding restricted stock units, or RSUs, or otherwise issuable pursuant to the terms of any equity incentives we may grant in the future, for public resale under the Securities Act.
−Removed: Such underlying common stock will become eligible for sale in the public market to the extent such options are exercised or RSUs are settled, subject to the lock-up agreements described above and compliance with applicable securities laws.
+Added: We have registered all of our common stock issuable upon exercise of outstanding stock options, settlement of outstanding restricted stock units, or RSUs, or otherwise issuable pursuant to the terms of the purchase rights under our employee stock purchase plan or any equity incentives we may grant in the future, for public resale under the Securities Act.
+Added: Such underlying common stock will become eligible for sale in the public market to the extent such options or purchase rights are exercised or RSUs are settled, subject to compliance with applicable securities laws.
Further, the holders of Class A and Class B common stock issued in connection with the conversion of our previously outstanding convertible preferred stock immediately prior to the completion of our initial public offering have rights, subject to some conditions, to require us to file registration statements covering the sale of their shares or to include their shares in registration statements that we may file for ourselves or other stockholders.
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• our involvement in any material litigation;
−Removed: • future sales of our Class A common stock by us or our stockholders, as well as the anticipation of lockup releases, or our sales of other securities in the future;
+Added: • future sales of our Class A common stock by us or our stockholders or our sales of other securities in the future;
• changes in senior management or key personnel;
2 unchanged sentences
• general economic, regulatory and market conditions;
−Removed: • technical factors in the public trading market for our Class A common stock that may produce price movements that may or may not comport with macro, industry, or company-specific fundamentals, including, without limitation, the sentiment of retail investors, the amount and status of short interest in our securities, access to margin debt, trading in options and other derivatives on our common stock and other technical trading factors.
+Added: • technical factors in the public trading market for our Class A common stock that may produce price movements that may or may not comport with macro, industry, or company-specific fundamentals, including, without limitation, the sentiment of retail investors, the amount and status of short interest in our securities, access to margin debt, trading in options and other derivatives on our Class A common stock and other technical trading factors.
Accordingly, we cannot assure you of the liquidity of an active trading market, your ability to sell your shares of our Class A common stock when desired, or the prices that you may obtain for your shares of our Class A common stock.
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These fluctuations have often been unrelated or disproportionate to the operating performance of those companies.
+Added: Additionally, the recent and acute volatility among certain financial institutions have raised questions regarding the stability of the banking sector and, while such volatility has not adversely affected our operations, it has had an adverse impact on the equity and credit markets.
Broad market and industry fluctuations, as well as general economic, political, regulatory and market conditions, may negatively impact the market price of our Class A common stock.
3 unchanged sentences
We expect to issue additional capital stock in the future that will result in dilution to all other stockholders.
−Removed: We expect to grant equity awards to employees, directors and consultants under our equity incentive plans.
+Added: We expect to grant equity awards to employees, directors and consultants under our equity incentive plans and purchase rights to our employees under our employee stock purchase plan.
We may also raise capital through equity financings in the future.
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If our financial performance fails to meet analyst estimates or one or more of the analysts who cover us downgrade our shares or change their opinion of our shares, our share price would likely decline.
−Removed: Our business results may vary significantly from such analyst estimates or any analyst consensus due to a number of factors, many of which are outside of our control, including due to the global economic uncertainty and financial market conditions caused by the COVID-19 pandemic or by geopolitical instability resulting from the conflict between Russia and Ukraine and resulting sanctions imposed by the United States and other countries against Russia and Belarus, which could adversely affect our business, financial condition and results of operations.
+Added: Our business results may vary significantly from such analyst estimates or any analyst consensus due to a number of factors, many of which are outside of our control, including due to the global economic uncertainty and financial market conditions, including as a result of (1) global and domestic disruptions, such as the COVID-19 pandemic or the emergence of new variant strains of COVID-19 and any uncertainties related to the recovery therefrom, (2) international conflicts that may impact international trade and global economic performance, such as the ongoing conflict between Russia and Ukraine and the related economic sanctions imposed by the United States and its trading partners against Russia and Belarus and (3) other macroeconomic trends, such as instability of financial institutions, international and domestic supply chain risks, inflationary pressure, interest rate increases and declines in consumer confidence, that impact us and our customers, which could adversely affect our business, financial condition and results of operations.
If one or more of these analysts cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our share price or trading volume to decline.
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We have only recently become a public company.
−Removed: Accordingly, we have incurred, and expect to continue to incur, significant finance, legal, accounting and other expenses, including director and officer liability insurance, that we did not incur as a private company, which we expect to further increase after we are no longer an “emerging growth company.” The Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, stock exchange listing requirements, and other applicable securities rules and regulations impose various requirements on public companies in the United States.
+Added: Accordingly, we have incurred, and expect to continue to incur, significant finance, legal, accounting and other expenses, including director and officer liability insurance, that we did not incur as a private company.
+Added: Additionally, we expect our finance, legal, accounting and other expenses related to being a public company to increase as we are no longer an “emerging growth company,” and we can no longer take advantage of the scaled
+Added: reporting obligations available to emerging growth companies.
+Added: Our management and other personnel will also be required to devote a substantial amount of time to support compliance with these additional requirements.
+Added: We cannot predict or estimate the amount of additional costs we will incur as a result of no longer qualifying as an emerging growth company.
+Added: The Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act, stock exchange listing requirements, and other applicable securities rules and regulations impose various requirements on public companies in the United States.
Our management and other personnel devote a substantial amount of time to support compliance with these requirements.
Moreover, these rules and regulations will increase our legal and financial compliance costs and will make some activities more time-consuming and costly.
+Added: For example, SEC proposals on climate-related disclosures may require us to update our accounting or operational policies, processes, or systems to reflect new or amended financial reporting standards.
We cannot predict or estimate the amount of additional costs we will incur as a public company or the specific timing of such costs.
1 unchanged sentence
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.