What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2024-02-29 compared with 2023-03-23 · 67 added, 64 removed, 172 unchanged (43% of the section changed)

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In addition, a portion of our revenue for the years ended December 31, 2023, 2022, and 2021 was generated indirectly and is categorized as other revenue on our Consolidated Statements of Operations and Comprehensive Loss.

Indirect revenue includes the sale of data insights from our member base and the sale of third-party products and services, including through targeted ads within our platform.

Indirect revenue includes revenue from the sale of aggregated data (non-personally identifiable information) for the purposes of data insights from our member base to our partners, and revenue from the sale of third-party products and services, including through the placement of ads within our platform.

For example, we generate revenue through the display of auto insurance products within the Life360 Platform.

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Our Growth Strategy

We plan to grow members in new and existing markets, increase monetization of our member base, and pursue disciplined expansion in new use cases, including entering new verticals.

We also plan to remain a trusted brand and indispensable safety membership for families by continuing to offer a suite of safety services that span every life stage of the family.

Our members are our best acquisition engine, and we believe that word-of-mouth referrals will continue to drive strong new member growth for Life360.

We plan to drive further market penetration through increased investments in marketing and brand awareness, member acquisition initiatives, and the provision of new features in new and existing markets.

Our primary strategy for subscriber conversion is to continue to invest in our product offering, provide the highest levels of member service and deepen our engagement with our member base.

Our growth is driven by member engagement and customer value, so our priority is driving continued innovation, delight, and value that continues to broaden our audience and enrich the role we play in their lives.

We believe these investments will help us grow membership in new and existing markets so that we remain a trusted brand and indispensable tool for families at every life stage.

Our members are our best acquisition engine.

We believe that word of mouth referrals, coupled with increased investments in marketing and member acquisition initiatives will drive strong new member growth for Life360.

We are also increasing our subscription value propositions and improving customer awareness of these benefits to grow subscription adoption and revenue per Paying Circle.

Further, we are opening new revenue streams, including advertising, that leverage our highly engaged base of 61 million monthly active users, while taking a cautious approach to ensure that we maintain the highest levels of customer satisfaction for free and paid customers.

Life360 Subscription Offerings

The Life360 mobile application operates under a “freemium” model where the core offering is available to users at no charge.

The Life360 mobile application operates under a “freemium” model where its core offering is available to users at no charge.

In addition, three paid membership subscription options are available for users looking for a wider variety of features, such as additional safety features for the everyday family:

Life360 Silver, Life360 Gold, and Life360 Platinum, which offer users a comprehensive suite of premium safety services.

Pricing for the paid memberships of the Life360 Platform currently ranges from $7.99 per month for Life360 Silver to $24.99 per month for Life360 Platinum.

Memberships are available in the United States and Canada.

Outside of these two markets, Life360 offers the free membership and a single paid membership option, which is priced at $4.99 per month in local currency equivalent and offers place alerts, location history and individual driver reports.

Pricing for the paid memberships in the United States of the Life360 Platform currently ranges from $7.99 per month for Life360 Silver to $24.99 per month for Life360 Platinum.

Memberships are available in the United States, United Kingdom and Canada.

Outside of these three markets, Life360 offers the free membership and a single paid membership option, which is priced at $4.99 per month in local currency equivalent and offers place alerts, location history and individual driver reports.

Life360 Platform

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The Tile mobile application offers a free service as well as two paid subscription options:

Premium and Premium Protect, which offers additional services such as warranties and item reimbursement.

Premium and Premium Protect, which offer additional services such as warranties and item reimbursement.

Jiobit Product Line

The Jiobit product line offers wearable location devices for young children, pets, and seniors.

Currently, Jiobit is offered exclusively in the United States via online retailers and brick and mortar retail channels.

Currently, Jiobit is offered exclusively in the United States via online retailers.

Customers purchase a Jiobit device at the current retail price of $129.99 and a monthly subscription to access Jiobit location tracking services.

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The Jiobit device requires a monthly subscription plan to stay connected to the Jiobit services.

Subscription prices vary based on the duration of the contract and range from $8.99 per month with a two-year commitment to $14.99 per month with no commitment.

Subscription prices vary based on the duration of the contract and range from $8.33 per month with a one-year commitment to $16.99 per month with no commitment.

Monthly contracts offer features such as location history, SOS notifications, and access to the Jiobit desktop portal.

Paid subscriptions are available for either $8.99 per month or $14.99 per month, depending on the subscription term.

Our Technology Platform

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We have designed an end-to-end location technology solution that allows us to deliver real-time location-based experiences and includes functionality such as storage, processing and communication of events, locations, drives, maps, places, networking and visualization of device characteristics for people, pets and things.

The Tile finding network, which allows Tile users to locate their devices via the Tile app, has been integrated into the Life360 Platform.

This integration allows members and Circles to keep track of their things and connect with each other through one seamless Life360 Platform.

We utilize third-party services for our backend platform and infrastructure to connect to our apps and custom hardware devices.

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This enhances our offerings with capabilities and features such as contextual auto insurance ads, identity theft protection, data breach alerts, and voice service integrations.

The Tile finding network, which allows Tile users to locate their devices via the Tile app, has been integrated into the Life360 Platform.

This integration allows members and Circles to keep track of their things and connect with each other through one seamless Life360 Platform.

Our competitors include both large competitors with various product and service offerings and smaller competitors, including (i) direct competitors with location sharing products that target family safety, (ii) competitors providing location sharing platforms that are not focused on family safety, (iii) competitors in the item tracking technology market and (iv) competitors that have, or may in the future have, overlapping offerings (for example, companies in industries related to roadside assistance and crash detection, identity theft protection, phone insurance and travel, disaster and medical assistance).

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We are in a fast moving and competitive environment and we have a team that is in it to win it.

As of December 31, 2022, we had approximately 400 full-time employees and approximately 200 contractors, all of whom have the flexibility to work remotely or out of our San Mateo and Chicago offices.

Life360 aims to provide a work environment in which all of our people can excel regardless of race, religion, age, disability, gender, sexual preference or marital status.

As of December 31, 2023, we had approximately 383 full-time employees and approximately 125 contractors, all of whom have the flexibility to work remotely or out of our San Mateo, California and Vancouver, Canada offices.

Life360 aims to provide a work environment in which all of our people can excel regardless of race, religion, age, disability, gender identity, sexual orientation or marital status.

Our Diversity Policy reflects a strong commitment to diversity, and a recognition of the value of attracting people with different backgrounds, knowledge, experience and abilities.

We believe that diversity contributes to our business success, and benefits all of our stakeholders.

As of December 31, 2022, approximately 37% of Life360 employees were female and 49% were people of color.

As of December 31, 2023, our company wide employees consisted of approximately 37% female, 62% male, and 1% non-binary.

employees consisted of approximately 33% Asian, 3% Black/African-American, 8% Hispanic or Latino, 5% of two or more races, and 51% White.

We are committed to implementing further initiatives to increase the diversity of our workforce.

We view the quality of our products and services as our key long-term strategic differentiator, and as such, we are committed to providing continuous learning and development opportunities for our people.

We provide peer training, including our standing Thursday “deep-dives” where our people can learn from the expertise of their colleagues.

Employees are provided access to career ladders and are encouraged to create individual development plans to focus on growth to the next level in their role.

Our standing Thursday “deep-dives” are where our people can learn from the expertise of their colleagues.

We also provide full day and full week-long courses in “best practices” and broad and specialist business training to further promote personal and professional growth.

In addition, our people have opportunities for cohort learning as well as personalized learning via the LinkedIn Learning Platform throughout the year.

Environmental, Social and Corporate Governance

Our core mission is the social good of simplifying safety for families through ESG initiatives based on four key areas:

We accomplish our core mission of simplifying safety for families through ESG initiatives based on four key areas:

people, environment, community and governance.

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We recognize that climate change will have an increasingly significant impact on all aspects of society.

In 2021, we committed to quantifying the environmental footprint of our business operations by measuring the following emissions:

direct greenhouse emissions that occur from sources that are controlled or owned by us (“Scope 1 Emissions”), indirect greenhouse emissions associated with the purchase of electricity, steam, heat or cooling (“Scope 2 Emissions”) and results of activities from assets not owned or controlled by us, but that indirectly impact our value chain (“Scope 3 Emissions”).

We are committed to quantifying the environmental footprint of our business operations by measuring the following emissions:

direct greenhouse gas emissions that occur from sources that are controlled or owned by us (“Scope 1 Emissions”), indirect greenhouse gas emissions associated with the purchase of electricity, steam, heat or cooling (“Scope 2 Emissions”) and results of activities from assets not owned or controlled by us, but that indirectly impact our value chain (“Scope 3 Emissions”).

By quantifying our impact, we will be able to implement an emission reduction plan that targets the greatest contributors to our carbon footprint.

We achieved carbon neutrality across Scope 1, 2, and 3 Emissions for calendar years 2021 and 2020.

We did not achieve carbon neutrality across Scope 1, 2, or 3 Emissions for the 2022 calendar year.

We are in the process of finalizing the reporting of Scope 1, 2 and 3 Emissions for the 2023 calendar year.

We achieved a carbon neutral status for the 2021 and 2020 calendar years by purchasing EcoAustralia credits that blend InfraVest Guanyin Wind carbon credits with Mount Sandy Conservation biodiversity protection units.

By purchasing EcoAustralia credits, we neutralize our emissions and promote conservation partnerships between traditional landowners and non-indigenous Australians.

Carbon neutral is a term used to describe when the greenhouse gas emissions released into the atmosphere by an organization over a certain time period, for example, calendar year, are negated through the purchase and retirement of carbon offsets.

We aim to simplify safety so families can live fully.

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Additionally, we engage in community outreach by supporting and matching employee contributions to three non-profit organizations committed to supporting families:

the Make-a-Wish Foundation, the American Society for the Prevention of Cruelty to Animals and Team Rubicon.

UNICEF USA, Best Friends Animal Society and St.

Jude Children’s Research Hospital.

We are committed to robust governance frameworks and responsible business practices to ensure the financial sustainability of the Company for all stakeholders including shareholders, employees, customers and suppliers.

We have established a disciplined process to identify, assess and analyze risk, and ensure appropriate risk monitoring and reporting.

Our 2021 and 2020 calendar year ESG reports are available at https://investors.life360.com/investor-relations, which is provided for reference only and is not incorporated by reference into this Annual Report on Form 10-K.

Our 2022 calendar year ESG report will be available on March 31, 2023.

Our ESG reports are available at https://investors.life360.com/investor-relations, which is provided for reference only and is not incorporated by reference into this Annual Report on Form 10-K.

We expect our 2023 calendar year ESG report to be available on March 31, 2024.

Research and Development

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Under the terms of the agreement, the agreement may be terminated (i) by mutual written consent, (ii) by advanced written notice from either party, (iii) for cause by either party after written notice of a material breach and failure by the other party to cure such breach within thirty days or (iv) immediately upon written notice by either party upon the bankruptcy or insolvency of the other party.

Our agreement with Jabil expired in March 2022.

We are currently in the process of renewing our agreement.

As of December 31, 2023, we are operating under an extension agreement to our initial agreement with Jabil, which expired in March 2022, and are in the process of negotiating a new agreement.

Jabil has provided us with written confirmation of its intention to continue our relationship on the same terms as our original manufacturing agreement, and to enter into a new agreement with us on similar terms.

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Further, in some foreign countries, the mechanisms to establish and enforce intellectual property rights may be inadequate to protect our technology.

To protect our brand, as of December 31, 2022, we owned a trademark portfolio comprising U.S.

registered trademarks including our primary mark “Life360” and various versions of the Life360 logo, in addition to other Life360 word marks and logos, as well as registered and pending trademarks for our “Tile” and “Jiobit” marks in the United States and certain foreign jurisdictions.

To protect our brand, we hold and maintain a global trademark portfolio.

In the U.S., we own trademark registrations for our “Life360”, “Jiobit”, and “Tile” marks and logos.

We also own applications and registrations for “Tile”, “Tile-formative” and other trademarks in certain foreign jurisdictions.

Trademark registrations can generally be renewed as long as the marks are in use.

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We further protect the use of our proprietary technology and intellectual property through provisions in both our customer terms of use on our website and in our vendor terms and conditions.

For information regarding risks related to our intellectual property, please see “Risk Factors—Risks Related to Our Technology and Intellectual Property.”

For information regarding risks related to our intellectual property, please see “Item 1A.

Risk Factors—Risks Related to Our Technology and Intellectual Property.”

Life360 subscriptions have historically experienced member and subscription growth seasonality in the third quarter of each calendar year, which includes the return to school for many of our members.

Hardware sales have historically experienced revenue seasonality in the fourth quarter of each calendar year, which includes the important selling periods in November (Black Friday and Cyber Monday) and December (Christmas and Hanukkah) in large part due to seasonal holiday demand.

During the year ended December 31, 2022, the Company leased real estate space under non-cancellable operating lease agreements in San Francisco, San Diego and San Mateo, California and Chicago, Illinois.

As of December 31, 2022, the Company had terminated the operating lease agreements in San Francisco and San Diego, California and relocated its corporate headquarters to San Mateo, California.

Our offices in San Mateo and Chicago generally accommodate principal, development, engineering, marketing and administrative activities.

Hardware sales have historically experienced comparatively higher seasonal growth in the fourth quarter of each calendar year, which includes the important selling periods in November (Black Friday and Cyber Monday) and December in large part due to seasonal holiday demand.

During the year ended December 31, 2023, the Company leased real estate space under non-cancellable operating lease agreements in San Mateo, California and Chicago, Illinois.

As of December 31, 2023, the Company had terminated the operating lease agreement in Chicago, Illinois.

As of December 31, 2022, the Company relocated its corporate headquarters to San Mateo, California.

Our office in San Mateo generally accommodates principal, development, engineering, marketing and administrative activities.

Beginning in 2020 at the start of the COVID-19 pandemic, we began operating as a remote-first company with plans to continue as such indefinitely.

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Further, it is possible that certain governments may seek to block or limit our products or otherwise impose other restrictions that may affect the accessibility or usability of any or all our products for an extended period of time or indefinitely.

For additional information, see the section entitled “Risk Factors—Risks Related to Legal Matters and Our Regulatory Environment.”

For additional information, see the section entitled “Item 1A.

Risk Factors—Risks Related to Legal Matters and Our Regulatory Environment.”

Government Regulation of Data Privacy and Security

In the ordinary course of our business, we may process personal or other sensitive data.

This data may relate to our users, employees, partners, vendors, and others.

This data may include contact details, payment card information, geolocation data, as well as information collected from and about children and minors.

Accordingly, we are or may become subject to numerous data privacy and security obligations, including federal, state, local, and foreign laws, regulations, guidance, and industry standards related to data privacy and security.

Such obligations may include, without limitation, the Federal Trade Commission Act, the Telephone Consumer Protection Act of 1991 (“TCPA”), the Children’s Online Privacy Protection Act of 1998 (“COPPA”), the Controlling the Assault of Non-Solicited Pornography And Marketing Act of 2003 (“CAN-SPAM”), the California Consumer Privacy Act of 2018 (“CCPA”), the European Union’s General Data Protection Regulation 2016/679 (“EU GDPR”), the EU GDPR as it forms part of United Kingdom (“UK”) law by virtue of section 3 of the European Union (Withdrawal) Act 2018 (“UK GDPR”), the Age Appropriate Design Code enacted by the UK Information Commissioner’s Office, the Privacy and Electronic Communications Directive 2002/58/EC on Privacy and Electronic Communications (the “ePrivacy Directive”), and the Payment Card Industry Data Security Standard (“PCI DSS”).

Such obligations may include, without limitation, the Federal Trade Commission Act, the Telephone Consumer Protection Act of 1991 (“TCPA”), the Children’s Online Privacy Protection Act of 1998 (“COPPA”), the Controlling the Assault of Non-Solicited Pornography And Marketing Act of 2003 (“CAN-SPAM”), the California Consumer Privacy Act of 2018 (“CCPA”), the European Union’s General Data Protection Regulation 2016/679 (“EU GDPR”), the EU GDPR as it forms part of United Kingdom (“UK”) law by virtue of section 3 of the European Union (Withdrawal) Act 2018 and the Data Protection Act 2018 (collectively the “UK GDPR”, with the EU GDPR and UK GDPR together referred to as the “GDPR”), EU Digital Services Act (“DSA”), the Age Appropriate Design Code enacted by the UK Information Commissioner’s Office, the Privacy and Electronic Communications Directive 2002/58/EC on Privacy and Electronic Communications (the “ePrivacy Directive”), and the Payment Card Industry Data Security Standard (“PCI DSS”).

Several states within the United States have enacted or proposed data privacy laws.

For example, Virginia passed the Consumer Data Protection Act, and Colorado passed the Colorado Privacy Act.

Additionally, we are or may become subject to various U.S.

federal and state consumer protection laws which require us to publish statements that accurately and fairly describe how we handle personal data and choices individuals may have about the way we handle their personal data.

The CCPA and EU GDPR are examples of the increasingly stringent and evolving regulatory frameworks related to personal data processing that may increase our compliance obligations and exposure for any noncompliance.

For example, the CCPA imposes obligations on covered businesses to provide specific disclosures related to a business’s collecting, using, and disclosing personal data and to respond to certain requests from California residents related to their personal data (for example, requests to know of the business’s personal data processing activities, to delete the individual’s personal data, and to opt out of certain personal data disclosures to third parties).

Also, the CCPA provides for civil penalties and a private right of action for data breaches which may include an award of statutory damages.

In addition, the California Privacy Rights Act of 2020 (“CPRA”), effective January 1, 2023, expands the CCPA.

For example, the CPRA gives California residents the ability to limit use of certain sensitive personal data, establishes restrictions on personal data retention, expands the types of data breaches that are subject to the CCPA’s private right of action, and establishes a new California Privacy Protection Agency to implement and enforce the new law.

Foreign data privacy and security laws (including but not limited to the EU GDPR and UK GDPR) impose significant and complex compliance obligations on entities that are subject to those laws.

As one example, the EU GDPR applies to any company established in the European Economic Area (“EEA”) and to companies established outside the EEA that process personal data in connection with the offering of goods or services to data subjects in the EEA or the monitoring of the behavior of data subjects in the EEA.

These obligations may include limiting personal data processing to only what is necessary for specified, explicit, and legitimate purposes;

requiring a legal basis for personal data processing;

requiring the appointment of a data protection officer in certain circumstances;

increasing transparency obligations to data subjects;

requiring data protection impact assessments in certain circumstances;

limiting the collection and retention of personal data;

increasing rights for data subjects;

formalizing a heightened and codified standard of data subject consents;

requiring the implementation and maintenance of technical and organizational safeguards for personal data;

mandating notice of certain personal data breaches to the relevant supervisory authority(ies) and affected individuals;

and mandating the appointment of representatives in the UK and/or the EU in certain circumstances.

The CCPA and the GDPR are examples of the increasingly stringent and evolving regulatory frameworks related to personal data processing that may increase our compliance obligations and exposure for any noncompliance.

Similar laws have been enacted or proposed in the past few years in other U.S.

states (including in Colorado, Connecticut, Utah and Virginia) and other foreign jurisdictions.

These laws impose certain data privacy and security obligations on covered businesses.

Generally, these and similar laws obligate covered businesses to provide specific disclosures in privacy notices and afford relevant individuals with certain rights concerning their personal data.

As applicable, such rights may include the right to access, correct, or delete certain personal data, and to opt-out of certain personal data processing activities, such as targeted advertising, profiling, or automated decision-making.

The exercise of these rights may impact our business and ability to provide our products and services.

These laws may also allow for regulators to impose statutory fines or allow private claimants to recover damages for noncompliance.

The European Union is also focused on the regulation of digital services.

The DSA came into force in 2022, with the majority of the substantive provisions taking effect in 2024.

The DSA may increase our compliance costs, require changes to our user interfaces, processes, operations, and business practices which may adversely affect our ability to attract, retain and provide our services to users, and may otherwise adversely affect our business, operations and financial condition.

Some European jurisdictions and the UK have also proposed or intend to pass legislation that imposes new obligations and liabilities on platforms with respect to certain types of harmful content.

While the scope and timing of these proposals are currently uncertain, if the rules, doctrines or currently available defenses change, if international jurisdictions refuse to apply similar protections that are currently available in the United States, or the European Union or if a court were to disagree with our application of those rules to our service, we could be required to expend significant resources to try to comply with the new rules or incur liability, and our business, financial condition and results of operations could be harmed.

For additional information about the laws and regulations to which we are or may become subject and about the risks to our business associated with such laws and regulations, see the section entitled “Risk Factors—Risks Related to Privacy and Cybersecurity.”

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The SEC maintains a website that contains reports, proxy and information statements and other information regarding our filings at www.sec.gov.

The ASX maintains a website that contains documents required under Australian securities laws and other information regarding our filings at www.asx.com.au.

Additionally, the Company routinely posts additional important information, including press releases, on its website and recognizes its website as a channel of distribution to reach public investors and as a means of disclosing material non-public information for complying with disclosure obligations under Regulation FD.

Accordingly, investors should monitor our website in addition to our SEC filings and public webcasts.

These items are available at investors.life360.com under “Results and reports”.

Accordingly, investors should monitor our website in addition to our SEC filings, ASX filings and public webcasts.

These items are available at investors.life360.com under “Financials and Filings”.

The information found on our website is not incorporated by reference into this Annual Report on Form 10-K or any other report we file with or furnish to the SEC.

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As a foreign Company registered in Australia, the Company is subject to different reporting and regulatory regimes than Australian companies.

As a foreign Company registered in Australia, the Company is not subject to Chapters 6, 6A, 6B and 6C of the Corporations Act 2001 (Cth) of Australia (“Corporations Act”) dealing with the acquisition of shares (including substantial shareholdings and takeovers).

Delaware Law, Certificate of Incorporation and Bylaws

As a foreign Company registered in Australia, the Company is not subject to Chapters 6, 6A, 6B and 6C of the Corporations Act dealing with the acquisition of shares (including substantial shareholdings and takeovers).

Under the provisions of Delaware General Corporation Law (“DGCL”), shares are freely transferable and subject to restrictions imposed by the U.S.

federal or state securities laws, by the Company’s certificate of incorporation, as amended (“Amended and Restated Certificate of Incorporation”) or bylaws (“Bylaws”), or by an agreement signed with the holders of the shares at issuance.

The Company’s Amended and Restated Certificate of Incorporation and Bylaws do not impose any specific restrictions on transfer.

federal or state securities laws, by the Company’s certificate of incorporation, as amended (“Certificate of Incorporation”) or bylaws (“Bylaws”), or by an agreement signed with the holders of the shares at issuance.

The Company’s Certificate of Incorporation and Bylaws do not impose any specific restrictions on transfer.

However, provisions of the DGCL, the Company’s Certificate of Incorporation and the Company’s Bylaws could make it more difficult to acquire the Company by means of a tender offer (takeover), a proxy contest or otherwise, or to remove incumbent officers and Directors of the Company.

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The Company believes that the benefits of increased protection of its ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure the Company outweigh the disadvantages of discouraging takeover or acquisition proposals because, among other things, negotiation of these proposals could result in an improvement of their terms.

Chess Depository Interests (“CDIs”)

Life360’s CDIs are issued in reliance on the exemption from registration contained in Regulation S of the U.S.

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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.

What changed 10-K

Item 1. Business