What changed in this filing

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Item 1. Business

2025-02-26 compared with 2024-02-23 · 379 added, 318 removed, 202 unchanged (78% of the section changed)

Sprout Social — Powering the Evolution of Customer Experience

With more than 5.0 billion global users consuming and sharing billions of posts per day, social media has fundamentally changed the customer experience.

Sprout Social — Driving Smarter, Faster Business Impact

With more than 5.22 billion global users consuming and sharing billions of posts per day, social media has fundamentally changed the customer experience and the way the world communicates.

Social media has become mission-critical to the way organizations reach, engage and understand their target audience and customers.

Sprout Social is a powerful, centralized platform that provides the critical business layer to unlock the massive commercial value of social media.

We have made it increasingly easy to standardize on Sprout Social as the centralized system of record for social and to help customers maximize the value of this mission critical channel.

Currently, more than 31,000 customers across more than 100 countries rely on our platform.

Sprout Social empowers businesses to tap into the power and opportunity presented by the shift to social communication.

Social media reaches almost half of the world’s population, influences buying behaviors and has changed the way the world communicates.

Billions of users are sharing their interests, opinions and values with their social networks every day and are using social media to communicate with and about businesses, organizations and causes on an unprecedented scale.

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We offer our customers a centralized, secure and powerful platform that can scale horizontally across an organization to drive maximum business value.

Introduced in 2011, our cloud software brings together social messaging, data and workflows in a unified system of record, intelligence and action.

Operating across major networks, including X (formerly known as Twitter), Facebook, Instagram, TikTok, Pinterest, LinkedIn, Google, Reddit, Glassdoor and YouTube, and commerce platforms Facebook Shops, Shopify and WooCommerce, we provide organizations with a centralized platform to manage their social media efforts across stakeholders and business functions.

Our platform is easy-to-use and can be deployed rapidly by new customers without direct engagement from our sales or services teams.

In 2023, the majority of our new customer revenue resulted from our trials and other inbound sources.

Our 30-day free trial model allows prospective customers to set up and use our software within minutes and without assistance.

We operate a single code-base without the need for customizations or professional services, allowing us to efficiently scale our platform and quickly react to changes in the market.

Relative to our primary competitors, our platform is the top user-rated social media management software across all major categories and customer segments according to G2, reinforcing our leading market position and brand.

For almost 15 years, Sprout Social has helped companies command their market on social media.

Our human-centric AI and advanced analytics deliver real-time insights from more than 1 billion daily messages, driving impact quickly and boosting productivity.

With straight-forward onboarding, powerful integrations, and ease of use, our platform is designed to scale to meet even the largest enterprise needs.

Our AI-led suite of solutions helps brands maximize the value of social, connect meaningfully with their audience, and leverage insights to enhance business strategies and customer retention.

Currently, approximately 30,000 customers across more than 100 countries rely on our platform.

The exceptional value we deliver is bolstered by our recognition as a Leader by IDC in the 2024 Marketscape for Social Marketing software for large enterprises, and our consistently high user ratings on G2.

We have proven success in the SMB, Mid-market and Enterprise segments.

Each of our segments is growing, but we expect that our current and future growth will likely be driven by outsized contributions from Mid-market and Enterprise.

We estimate that less than 5% of the millions of businesses on social media have adopted software solutions to centrally manage their social media efforts, providing a large, nascent opportunity to drive significantly increased market adoption of our solution and continued growth across all customer segments.

We have a highly efficient, product-driven go-to-market strategy that has enabled us to scale rapidly, attracting more than 31,000 current customers from small businesses to global brands as well as marketing agencies and government, non-profit and educational institutions.

In 2023, the strength of our brand, content marketing, and search engine optimization resulted in the majority of our inbound trials generated through unpaid marketing.

However, we expect that our current and future growth will likely be driven by outsized contributions from Mid-market and Enterprise.

We estimate that less than 5% of businesses have adopted social media management software, providing a large, nascent opportunity to drive significantly increased market adoption of our solution.

We have an efficient, product-driven go-to-market strategy that has enabled us to scale rapidly, attracting customers from small businesses to global brands as well as marketing agencies and government, non-profit and educational institutions.

With over 99% of our revenue in 2024 from software subscriptions, we have experienced strong unit economics across all customer segments as we continue to grow and refine our sales and marketing efforts.

In 2024, the majority of our inbound trials were generated through unpaid marketing due to the strength of our brand, content marketing, and search engine optimization.

The scale of these trials allows us to rapidly test, adapt and optimize our go-to-market approach for sustained, capital-efficient growth.

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As social becomes a critical channel for virtually all aspects of the customer experience, including brand awareness, influencer marketing, customer acquisition, social customer care, commerce, advocacy and reputation management, we expect that our customers will increase adoption of our platform across departments.

With our efficient go-to-market model and over 99% of our revenue in 2023 from software subscriptions, we have experienced strong unit economics across all customer segments as we continue to grow and refine our sales and marketing efforts.

Our single code-base also creates a scalable and capital-efficient model that enables us to add new customers at little incremental cost.

We believe that the single code-base and scalability of our technology are also meaningful technology differentiators.

Our success and innovation are driven by an experienced leadership team and award-winning culture with a reputation for caring deeply about the success of our customers and employees.

This strong employer brand allows us to attract and retain high-quality talent and deliver a premium experience for our customers.

In 2024, we were recognized as a Built In “Best Place to Work” for the sixth consecutive year.

Glassdoor has recognized us as one of the “Best Places to Work” in 2017, 2018, 2020, 2021, 2022 and 2023.

In 2023, we were also recognized by Great Place to Work and PEOPLE magazine on the 2023 PEOPLE Companies that Care list, which is based on data from companies representing more than 7.5 million U.S.

Sprout Social was also recognized as the #2 Best Workplace in Chicago and #18 Best Workplace for Parents by Great Place to Work.

Our strong culture, world-class management team, leading platform and efficient go-to market strategy have led to revenue of $405.9 million, $333.6 million and $253.8 million during the years ended December 31, 2024, 2023 and 2022, respectively, representing growth of 22% from 2023 to 2024 and representing growth of 31% from 2022 to 2023.

Additionally, we generated over $385 million in annualized recurring revenue, or ARR, as of December 31, 2023.

For more information on how we define and calculate ARR, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Business Metrics—ARR.” We generated net losses of $66.4 million, $50.2 million and $28.7 million during the years ended December 31, 2023, 2022 and 2021, respectively.

We generated net losses of $62.0 million, $66.4 million and $50.2 million during the years ended December 31, 2024, 2023 and 2022, respectively.

Social media began as a way for individuals to connect and share experiences.

Networks like X, Facebook, LinkedIn and subsequent major networks allowed individuals to more easily communicate with friends, family, colleagues and those who shared common interests.

Networks like X (formerly known as Twitter), Facebook, LinkedIn and subsequent major networks allowed individuals to more easily communicate with friends, family, colleagues and those who shared common interests.

As social media grew, savvy businesses recognized its power as a channel to market to consumers at scale.

A new form of advertising was born and brands rushed to establish a presence and following on social media as a powerful new way to connect with their customers.

With more than 5.0 billion users and millions of businesses adopting social media, it has fundamentally changed communication and commerce, and we are just beginning to understand its implications and importance.

We believe social media is simultaneously many things:

We believe social media plays a central role across several key dimensions of consumer behavior and business dynamics:

• social media is a facilitator of shared human experiences;

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• social media is an unprecedented source of business intelligence.

While businesses have begun to adapt by establishing a presence on social media and incorporating social media into advertising strategies, we believe the adjustments necessary to remain competitive and relevant amidst this disruption are substantial and require new software solutions, business processes and approaches in every corner of the organization.

Social Media’s Impact on Business

Businesses must face the reality that social media is not simply a place to advertise.

Social media has evolved to impact aspects of marketing, public relations, sales, customer relationships, customer service, product feedback, commerce, business intelligence and strategy.

Social media is a new layer that will embed in the digital technology stack across an organization:

Businesses must face the reality that social media is not simply another marketing channel.

Social media now plays a crucial role across the entirety of an organization, from marketing and communications to sales, customer relationships, customer service, product feedback, and more.

Social media is an invaluable layer that is embedded in the digital technology stack:

• Consumer influence has expanded .

The ubiquity and ease of social media has enabled a new, public form of casual opinion, observation, endorsement or criticism.

Social media has given consumers a powerful, public voice that can reward or penalize organizations.

Social media has

given consumers a powerful, public voice that can reward or penalize organizations.

Organizations must listen and respond to this voice.

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A significant number of purchasing decisions are originating from, influenced by or transacted through social media.

According to our report, Social Shopping in 2022:

Consumer Behaviors in the Social Shopping Cart, 40% of consumers find products via organic social posts from the brand and 34% of consumers research products using social media.

According to The 2025 Sprout Social Index™, 81% of consumers say social drives them to make impulse purchases and about one-third of all consumers anticipate making more purchases from social networks in 2025.

• Consumer expectations are high .

Consumers demand that brands be present and responsive across social networks, with more than 76% anticipating a response to a social media message within 24 hours and more than 90% expecting a response within 48 hours, according to The 2022 Sprout Social Index.

According to the same report, when brands take too long to respond, 36% of consumers say they’ll share that negative experience with friends and family, 31% say they won’t complete their purchase, and 30% say they will buy from a competitor instead.

Consumers demand that brands be present and responsive across social networks, with nearly three-quarters of consumers expecting a response to a social media message within 24 hours or sooner, according to The 2025 Sprout Social Index™.

The same report also found that 73% of consumers say they’ll buy from a competitor if a brand doesn’t respond on social media.

• All aspects of business communication are shifting to social .

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We believe social media provides the largest source of business intelligence that has ever existed.

This represents a real time pulse of consumer sentiment that is unbiased and includes a broad universe not only of current

customers, but of potential future customers.

This represents a real time pulse of consumer sentiment that is unbiased and includes a broad universe not only of current customers, but of potential future customers.

Real-time consumer opinions, market trends, competitive insights, product performance and market research can be measured and analyzed using social data.

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Consumers are expressing their opinions and talking to and about brands through billions of posts per day.

Most organizations are not equipped for this new reality and must adjust their business processes and implement tools to manage this new communication channel.

Organizations may know they need to adapt to this new reality and adjust their business processes and implement tools to manage this new communication channel, but are unsure how to mine value from social.

• The alternative is irrelevance .

A failure to solve the challenges posed by the shift to social communication would mean disconnecting from large and growing demographics.

A failure to solve the challenges posed by the shift to social communication would mean disconnecting from large and growing demographics and losing

out on market share and business growth.

Organizations seeking to engage and connect with their audience without utilizing social tools and strategies are at a severe disadvantage.

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A misstep on social media is magnified and can lead to boycott or brand erosion overnight.

The need for centralized tools with the necessary workflows, security and visibility across an organization has never been more critical.

In this high-stakes environment, the need for an intuitive platform that empowers brands to create exceptional customer experiences, maintain a competitive edge and drive efficiency has never been more critical.

Embedded AI, enterprise-grade security, permissions, and reliable network and business APIs are essential to navigate this landscape.

A mistake over email or the telephone is typically isolated to the sender and recipient.

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• Managing social is highly complex .

Social media communication and consumption are happening billions of times per day across multiple platforms and formats, requiring businesses to be every place at once.

Billions of social media interactions occur every day across various platforms, requiring businesses to engage across all channels simultaneously.

Organizations are forced to manage dozens to hundreds of social profiles, a multitude of public and private conversations and billions of data points in real time.

Managing this complex landscape in an efficient, secure and scalable manner is not viable without a centralized platform.

Managing this complex landscape in an efficient, secure and scalable manner while fueling growth is not viable without a comprehensive, AI-driven platform.

• It is difficult to gather intelligence .

Social is one of the largest sources of business intelligence in the world and possesses the ability to answer critical questions and inform strategy.

However, most organizations currently lack the tools necessary to access and analyze available data.

• Significant data privacy and security concerns exist .

Data privacy and security issues have dominated the discussion around social media in recent years, leading to increased complexity, risk and regulation.

Conforming to these requirements and maintaining security across dozens to hundreds of social profiles on multiple social networks reinforces the need for centralized management.

• Brands need a centralized solution .

Managing the complexity of social media and providing a positive customer experience require that all parts of an organization share a single system of record, intelligence and action.

For example, a social media message from a customer may require collaborative input and action from multiple departments at once.

Without a centralized platform to provide visibility, workflow and coordination across business functions, the customer experience can become disjointed and inconsistent.

Our powerful, easy-to-use platform enables customers to manage the complexities of social media across their entire organization.

Our relationships with X (formerly known as Twitter), Facebook, Instagram, Pinterest, LinkedIn, Google and TikTok, among others, allow us to build robust solutions that meet today’s business needs while maintaining our focus on innovation as the market evolves.

Our relentless focus on customer relationships and building the highest-quality products have made our platform the highest customer-rated product across all major categories and customer segments relative to our primary competitors according to G2.

The key benefits of our platform include:

• Comprehensive, all-in-one platform .

Our platform brings every aspect of the social experience together into a single, elegant and robust solution.

From engagement, publishing, and reporting and analytics to reputation management, influencer marketing, business intelligence, advocacy, and workflow and collaboration, our customers can manage their entire social experience seamlessly and more effectively through a single pane of glass.

• Single platform for the entire organization .

Our platform delivers a compelling experience by enabling users across all functions and use-cases to work side-by-side.

Rather than isolating these use-cases and toolsets, we have brought them together seamlessly through a centralized solution to drive visibility and collaboration across the entire organization.

• Easy to deploy and use .

As the impact of social media spreads further across organizations, ease of deployment and usability are critical.

With no professional services or customizations required, a typical customer is fully operational within minutes of starting their trial.

Our powerful platform is designed to be easy to use so that it can be rapidly adopted and leveraged by novice users while also having the robust capabilities needed by the most demanding Enterprise users.

Our platform enables seamless collaboration across departments and is consistently rated the easiest-to-use social media management software available amongst our primary competitors.

• Purpose-built to handle the velocity of social.

We have the ability to quickly adapt as the market changes because all of our customers are served from a single code-base.

We can deploy a change in minutes for the benefit of our over 31,000 current customers to address changes in network functions, expanded capabilities and evolving compliance requirements.

We remove this burden from our customers while continuing to drive innovation with constant enhancements across our platform.

• Democratizing business intelligence.

When businesses have access to better information, everyone benefits.

Our platform harnesses and delivers the power of vast business intelligence across the organization where it can be translated into value and innovation.

Our customers have immediate access to social analytics, competitive insights, peer benchmarking, market research and consumer trend information.

Combining and benchmarking billions of data points, we help our customers measure their performance, identify opportunities for improvement and understand how their brands should evolve.

• Proven scale, reliability and security .

With over 31,000 current customers, our platform and architecture have the massive scale needed to deliver exceptional performance and reliability, as well as visibility into trends that can indicate where our market is headed.

We have the robust security and compliance tools needed to be successful.

Social media has become one of the largest and most dynamic sources of business intelligence in the world, offering invaluable insights that can answer critical questions and shape strategic decisions.

From real-time customer sentiment to emerging market trends, social data often holds the key to understanding consumer behavior and staying ahead of the competition.

Yet, despite its potential, most organizations lack the advanced tools needed to harness, analyze, and unlock the full value of this wealth of information.

• Significant data privacy and security concerns aren’t going away .

As data privacy and security concerns continue to dominate the social media landscape, businesses must act quickly to navigate increasing complexity, risk, and regulation.

To stay ahead, brands need to take charge of their market by adopting social media management platforms that safeguard customer data across multiple social profiles and networks.

Addressing these challenges with agility is critical not only for maintaining security and trust, but also for staying competitive in an increasingly fast-evolving environment.

• On social media, every second matters for brands.

In the fast-paced world of social media, delivering a seamless customer experience requires quick, coordinated action across multiple departments.

A single social media message often requires input from multiple teams, and without a platform providing clear social insights and streamlining workflows, timely and effective responses are compromised.

The right platform must deliver value quickly and enable teams to achieve fast, impactful results with minimal complexity.

Without an intuitive platform that drives rapid adoption, organizations fail to meet the pace their customers demand, risking a disjointed and inconsistent customer experience.

Brands can no longer afford to overlook the importance of social media, where every interaction has the potential to influence their reputation and expand their reach.

Sprout Social offers an intuitive

platform designed to scale with organizations of all sizes and to help empower teams to secure a competitive advantage and boost their market position.

Customers can rapidly activate Sprout Social and expedite the implementation process to access analysis-ready AI.

Social profiles are efficiently connected, and software integrations are configured to deliver rapid results, starting as soon as a customer’s trial, which was a key driver of new customer revenue in 2024.

Our platform is built to reduce the need for extensive training, custom AI builds, and external specialists, leading to lower implementation and services costs and faster time to value.

We believe our product is the industry standard for product quality, design and user experience, taking the complexity out of social and putting it in one, intuitive platform so our customers can focus on growing their business.

We believe that when businesses have access to better information, everyone benefits.

Our platform aggregates and delivers vast amounts of business intelligence to the right teams, enabling customers to leverage social insights, competitive intel, peer benchmarking, market research, and consumer trend information.

By analyzing billions of data points, our platform empowers customers to measure performance, identify growth opportunities, and gain a deeper understanding of their market and competitive landscape.

Our platform leverages a unified codebase that facilitates efficient deployment of new features, updates, and bug fixes.

This approach allows us to deliver continuous innovation at an accelerated pace, giving our customers access to the latest tools to drive growth and improve return on investment (ROI).

This single codebase architecture not only optimizes performance but also enables our company to maintain a customer-first approach, responding to market changes with agility and enabling scalability without inefficient resource allocation.

While solutions such as Employee Advocacy and Influencer Marketing are distinct technologies, they operate on underlying codebases similar to that of Sprout Social.

We have cultivated strong, strategic relationships with leading social networks—including Facebook, Instagram, Threads, X (formerly Twitter), Pinterest, LinkedIn, YouTube, Reddit, Tumblr and TikTok.

These premier partnerships provide access to the most reliable social data and first-in-line API updates, empowering our customers to make informed, confident decisions that drive sustained growth and innovation.

Additionally, our platform is built to seamlessly integrate social throughout our customers' existing operations.

Whether streamlining social workflows, optimizing customer experiences, or enhancing business decision-making, our integrations empower teams to drive measurable results and maximize ROI.

By enabling customers to embed social where they need it the most, we help them achieve their strategic objectives and accelerate success.

We offer a robust suite of AI-powered solutions:

• Publishing and Scheduling

• Social Customer Care

• Reporting and Analytics

• Social Listening and Business Intelligence

• Reputation Management

• Social Commerce

• Influencer Marketing

• Employee Advocacy, and

• Automation and Workflows.

These solutions serve a broad range of use-cases for our customers, including but not limited to:

social and community management, public relations, marketing, brand advocacy and management, customer service and care, commerce, sales and customer acquisition, recruiting and hiring, product development, and business strategy.

Our Competitive Strengths

Sprout Social’s market has significant barriers to entry.

The technical complexities of social media platforms, the need for established network relationships, and increasing customer demands for data privacy and security have made it more difficult for new competitors to enter the space.

Over the past several years, these barriers have grown considerably.

As an early leader in the social media management market, we believe we are uniquely positioned to help customers drive meaningful business impact.

The competitive strengths of our platform include:

• Product-led platform .

We organically built the core capabilities of our platform, allowing us to maintain our high-quality standards and a seamless customer experience.

Recognizing that using our product is often the first experience our prospective customers have with Sprout, our focus from inception has been to build elegant, powerful and easy-to-use products.

Further, our proprietary single code-base allows us to adapt and update our products quickly as social platforms evolve.

• Market leadership and premium brand .

• Our platform is growth-oriented .

Our AI-driven solutions enable customers to take control of their market presence and drive growth through social media.

Our human-centric AI is embedded across much of our platform, helping teams unlock significant value.

According to Forrester’s 2025 study “The Total Economic Impact of Sprout Social”, our platform leads to a potential ROI of up to 268%.

Customers can amplify this growth further by integrating social with business intelligence to uncover key opportunities through Sprout Social’s API, integrations, and business intelligence (BI) connectors.

Our advanced analytics also then demonstrate the measurable impact of social media on business performance.

• Our intuitive platform drives rapid adoption .

Our platform can be quickly deployed to provide valuable data across an organization through AI-powered workflows, streamlined onboarding, and intuitive usability, all of which can scale to meet the needs of even the largest enterprises.

Leveraging advanced AI and automation, Sprout Social processes over 1 billion messages daily, enabling customers to access critical insights and drive impactful results from day one.

The platform is designed for ease of use, requiring no specialized certifications or expertise in Boolean queries.

Customers can quickly harness the power of AI to gain insights and manage campaigns effectively.

• Our AI is human-centric .

Our AI and automation doesn’t just support teams - it amplifies their strengths and supercharges their capabilities, empowering them to think outside the box when it comes to social.

We intentionally build our AI to be human-centric, to complement and empower the people behind the brand.

Our proprietary AI and automation access more than 10 years of historical social data sets and 15 years in sentiment and textual analysis to elevate insights and deliver precise recommendations.

Paired with our secure AI integrations, our AI-powered features are designed to be intuitive, making it easy for your teams to harness the full potential of social and to focus on high-impact work.

• We act as a trusted partner to support our customers .

Sprout Social helps customers transform their social media presence through our platform, combining powerful integrations, expert insights, and exceptional support to drive measurable results.

Our customer satisfaction (CSAT) score has been consistently high, with a 95% score over the past five years and 98%+ in the last two years.

The CSAT score is determined based on an internal survey of customers following the resolution/closure of a support case.

We prioritize customer-driven innovation, using feedback from our approximately 30,000 customers to guide our product roadmap.

This helps us identify the features and products most important to our customers, enabling us to deliver a platform that creates compelling, user-focused experiences.

Additionally, customers receive exclusive access to The Arboretum, a dynamic

community of over 10,000 members, where they receive ongoing support and social expertise needed to drive impact.

• Our social media network partner relationships are strong.

Sprout Social has established strong relationships with all the leading social media platforms.

These partnerships facilitate close collaboration, enabling our team to address evolving customer needs and introduce innovative solutions to the market.

These relationships provide access to valuable insights and opportunities for product development and improvement.

• Our platform is purpose-built and comprehensive.

Our platform is designed to bring every aspect of the social experience together into a single, elegant and robust solution.

From social customer care, publishing, and reporting and analytics to reputation management, influencer marketing, business intelligence, advocacy, and workflow and collaboration, our customers can manage their entire social experience more effectively through a single interface.

Our platform was built with a flexible infrastructure, enabling rapid adaptation to market changes, with some updates and new features that can be deployed quickly.

This flexibility relieves customers of operational burdens and allows us to foster innovation through regular platform enhancements.

• Our platform is proven to be scalable, reliable and secure.

With around 30,000 customers, our platform is built to scale and to deliver exceptional performance, reliability, and insights into emerging market trends.

Sprout Social’s software supports businesses of all sizes, including enterprises, with 99.99% uptime.

We hold ourselves to the highest standards for success with robust security and compliance measures.

• Our market leadership and premium brand are excellent.

Our solution is highly regarded and recognized in the industry.

Our robust content marketing engine delivers thought leadership to all decision makers in the buying process, from practitioners to executives.

Our robust content marketing engine is designed to deliver thought leadership to all decision makers in the buying process, from practitioners to executives.

As a result of our strong brand and reputation for quality and service, we generated more than 80% of our revenue from new customers in 2024 from unpaid channels.

• Diverse customer base with a highly efficient go-to-market strategy .

We serve a large number of customers across industry and customer segments.

With our self-serve, inside and field sales strategies, we seek to efficiently provide each customer segment with an exceptional experience and efficient scalability.

• Minimal time to value .

Our unified code-base and efficient sales strategy allow us to deliver the product to each customer quickly and seamlessly.

Within minutes of requesting our products, our customers can implement our platform across their organizations.

• Massive and growing dataset .

With over 31,000 current customers and billions of data points, we are able to harness massive amounts of feedback to optimize our products rapidly and in real-time, benefiting our platform by enabling us to understand the key features and products that are important to our customers and create compelling user experiences.

• Network relationships.

We have built strong relationships with major social media networks, including X, Facebook, Instagram, TikTok, Pinterest, LinkedIn and Google, among others.

We work together closely with these networks to address the evolving needs of our customers and to bring new ideas and innovation to market.

• Superior customer service.

We offer live customer support to each customer regardless of spend, and customer success has always been deeply rooted in our DNA.

As a result, we have been recognized on G2’s 2023 list of the Highest Satisfaction Products, defined as products that "leave the most positive impact on their users."

• Large and growing barriers to entry.

Due to the technical complexities on the back end of social media, required network relationships and rising customer emphasis on data privacy and security, we believe the barriers to entry in our market have risen materially over the past several years.

• World-class culture .

• We foster a world-class culture .

Our success is possible because of our award-winning culture, which allows us to attract and retain top talent.

We have a deep commitment to our people and our customers that compounds our competitive advantages as we continue to grow.

At Sprout, culture is a business strategy.

We do not view culture as a set of perks but rather an intentional approach to our employees, customers and communities.

We believe our culture serves as a strong competitive advantage, allowing us to build the kind of company that can lead a market, adapt and continue to innovate for our customers.

We believe our ability to execute on our growth strategy is directly related to our award-winning culture with a reputation for caring deeply about our customers and our employees.

This is evidenced by our top user rating on G2 and 4.2 rating and 89% CEO approval rating on Glassdoor.

Glassdoor has recognized us as one of the “Best Places to Work” in 2017, 2019, 2020, 2021, 2022 and 2023.

In 2023, we were also recognized by Great Place to Work and PEOPLE magazine on the 2023 PEOPLE Companies that Care list, which is based on data from companies representing more than 7.5 million U.S.

In that survey, 91% of employees said Sprout Social is a great place to work, which is 60% higher than the average U.S.

Sprout was also recognized as the #2 Best Workplace in Chicago and #18 Best Workplace for Parents by Great Place to Work.

This strong employer brand allows us to continue to attract high-quality talent and deliver a premium experience for our customers.

Our culture is centered on seven core values:

• Care deeply .

We genuinely and deeply care about our customers, people, communities and families.

We cannot serve one of these groups without serving them all well.

• Embrace accountability .

We are accountable as individuals and as an organization, and celebrate our wins and our failures with equal appreciation.

• Champion diversity, equity and inclusion .

Our success comes from our diverse and talented people with varied perspectives who can be their whole selves in an equitable and inclusive environment.

• Promote open, authentic communication .

Our business was built on the idea that open communication moves the world forward.

• Seek simplicity .

We strive to make our products, our processes, our policies and our operations as free from complexity as possible, allowing us the ability to grow, adapt and thrive.

• Solve hard problems .

We solve hard problems in thoughtful, elegant ways to provide remarkable experiences for our customers and team.

• Celebrate change .

Our industry was created from a transformative shift in the way people communicate.

We are a company that sees thoughtful change as an opportunity rather than a burden.

The alignment of our values and shared goals allows us to move quickly in a space that is constantly evolving.

Our Market Opportunity

Due to social media’s rapidly growing strategic importance, we believe all organizations of adequate scale around the globe would benefit from using a social media management solution to engage with their consumers and drive insights from social data.

We also believe our platform addresses this significant capability gap, serving what we refer to as the social media management market.

We estimate that, based on our current average customer spending levels, the annual served addressable market (SAM) for our platform in 2023 exceeded $55 billion.

We estimate that our SAM opportunity will exceed $120 billion by 2025, an annual market growth rate of greater than 25%.

We calculated our current SAM estimate as follows:

(i) utilized data from The U.S.

Small Business Administration, The U.S.

Census Bureau, The Organisation for Economic Co-operation and Development and Statista to estimate the total number of businesses in the United States and globally in each of our served market segments (Enterprise, Mid-Market, SMB) with a social media presence;

(ii) utilized internal data and estimates to estimate the number of such businesses that require a social media management platform (the “Target Businesses”);

(iii) calculated the average of our annual contract value (ACV) and our estimate of our primary competitors’ ACVs in each segment;

and (iv) multiplied the estimated average segment ACVs by the estimated number of Target Businesses in each segment.

We then used internal estimates informed by research from the Harris Poll to determine the projected business presence on social media in 2025 that will require a social media management platform, multiplied by our internal projected average segment ACVs in 2025 for Sprout Social and its direct competitors in the applicable segment.

Our Growth Strategies

We intend to capitalize on our large market opportunity with the following key growth strategies:

• Acquire new customers .

We believe there is a substantial opportunity to increase adoption of our solution.

We have experienced strong organic new customer growth due to low-friction, self-serve onboarding that allows us to acquire customers with relatively low sales and marketing investment.

We intend to aggressively pursue new customers with increasing efficiency in our go-to-market approach while expanding our sales capacity.

Although many new customers adopt our solution during their first engagement with us, we intend to drive higher conversion of product demonstrations and new trials through various sales, marketing and product initiatives as one component of our customer acquisition strategy.

• Further penetrate our existing customer base .

We believe we can achieve significant organic growth by expanding penetration of our existing customer base with the addition of new users, new add-on products and new use-cases for our platform.

As social media drives businesses to evolve their strategies holistically across customer service and support, corporate communications, product development and recruiting and training, we believe that we have a significant opportunity to increase our sales further into, and outside of, the marketing business unit.

• Continue to innovate and develop new products .

We are focused on investing in research and development to continue to enhance our platform and release new features, and we have one of the largest independent datasets of consumer social media presence.

As we make this investment, we expect to develop new products leveraging our valuable dataset and broadening our offerings, while expanding into adjacent markets.

• Expand into international markets .

We are still early in the global adoption curve for social media solutions, which presents a large opportunity to capture market share in an underserved and growing market.

As we invest in acquiring new customers, we expect to continue to develop our presence in international markets, such as Europe, Australia and New Zealand, to address this large opportunity.

For example, we opened an office in Dublin, Ireland to better serve the EMEA market, and we have sales representatives in Canada, the United Kingdom, Singapore, India and Australia.

Social media has created significant opportunities for businesses to reach, acquire, retain and connect with their customers.

It has also introduced a high level of complexity and the need for a centralized platform to manage these efforts across the organization.

Our platform brings all of the necessary tools together for organizations to expertly and efficiently manage this new channel and create compelling experiences for their audience.

Our powerful, easy-to-use cloud platform allows organizations of all sizes to create stronger relationships through social media, create and publish effective content, measure and improve performance and better understand their markets and customers.

We provide robust and fully integrated tools across a variety of functions:

• Social Engagement / Response;

• Publishing;

• Reporting and Analytics;

• Social Listening and Business Intelligence;

• Reputation Management;

• Social Commerce;

• Employee Advocacy;

• Automation and Workflows.

These tools serve a broad range of use-cases within our customers’ organizations including:

• Social and Community Management;

• Public Relations;

• Influencer Marketing;

• Customer Service and Care;

• Sales and Customer Acquisition;

• Recruiting and Hiring;

• Product Development;

• Business Strategy.

Ease of Use / Implementation

Our platform does not require long deployment and implementation cycles, or high services costs to maintain.

Our customers can be up and running in a matter of minutes, which serves as one of our key competitive advantages.

We believe our product is the industry standard for product quality, design and user experience, taking the complexity of social and putting it in one simple platform so our customers can focus on growing their business.

Moving at the Pace of Social

Keeping pace with the evolution of social networks alongside our customers’ usage is a prerequisite for our success.

We believe our competitive advantage is partly due to the relationships we have built with the social networks over the past nine years.

These relationships have enabled us to

actively collaborate in lockstep with their respective product and engineering teams to roll out new features for our customers.

Components of our Platform

managing social media conversations

Social media messaging has taken the place of telephone and email for many customer and business interactions.

Our engagement tools allow our customers to efficiently and effectively receive and respond to messages across social platforms and provide the collaboration and visibility necessary to create seamless customer experiences across the organization.

• Smart inbox.

We bring public and private messages from across social networks and profiles into a single, unified inbox.

This allows our customers to centralize interactions with their audiences and customers and provides the necessary tools and workflows to deliver seamless customer experiences.

• Social CRM.

When interacting across social channels, context is important.

We provide historical conversations, notes and user information in-line to ensure responses are relevant and productive.

• Social monitoring and alerts.

In addition to messages sent to our customers, our platform also captures messages relating to our customers, for awareness and response when needed.

We also provide an alerts engine to notify our customers when critical messages are received.

• Customer service tools.

Many of the messages received through social media are customer service related.

We provide tools to route and assign messages, and to measure the performance of our customer’s customer service efforts through social media.

• Automation.

We provide our customers the ability to automate alerts and categorization of messages, as well as a bot-builder technology that can automate high-volume customer conversations in private social channels.

AI and automation:

ignite creativity by breaking free from limits

We believe AI should be our customers’ secret weapon – helping them work faster and uncover insights that let brands focus on more impactful work.

Clunky AI that requires intensive investment to get up and running only slows teams down and blocks them from taking charge of their market.

At Sprout Social, we believe the best solutions make it easier for teams to drive growth.

By embedding our AI throughout our intuitive platform, Sprout Social’s AI and automation seek to bring order to the chaos on social, freeing teams to think beyond limits and unleash creativity to become market leaders.

From content creation and social customer care to data analysis and creating strategic insights – AI on our platform can save teams time, fast-track business outcomes, and unlock creativity.

Designed with people in mind, our AI acts as a personal assistant, empowering teams to leverage, rather than complicate or replace, their own strengths.

With more than ten years of collecting social data and trends across industries and networks and more than 15 years in sentiment and textual analysis powered by natural language processing (NLP), we

believe we can uniquely build models that provide precise outputs tailored to our customers’ social media needs.

Our proprietary social data, AI models, and secure AI integrations prioritize rigorous privacy and compliance to protect customer data.

plan and publish effective content

Publishing effective, compelling content on social media is critical to growing an audience and keeping them engaged.

We provide the tools necessary to plan, create and publish content to reach the right audience, with the right message at the right time.

Sprout Social’s Publishing transforms social content calendars into a vibrant collaboration hub.

With Sprout Social, teams can publish at the right time and streamline planning thanks to customizable approval workflows, shareable links that don’t require logins, and calendar notes that empower teams to strategize efficiently.

• Centralized content planning, creation and publishing .

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We provide libraries for shared content and assets that can be used across teams, locations or departments.

measure and improve your social media performance

Our reporting suite helps our customers drive strategic decision making across their business with access to rich social data and analytics.

We provide them the tools to measure their effectiveness and productivity, benchmark against peers, measure content performance and business impact, and gain insights on areas of improvement.

outsmart the competition with proactive customer care

With customer expectations soaring, social media management platforms emerged as the holy grail for driving ROI from customer engagement.

Sprout Social gives teams a competitive edge for mastering customer connections, using a complete customer snapshot and personalization.

Sprout Social’s Engagement is designed to optimize customer experiences with AI-driven solutions that humanize customer connections and elevate care.

Thanks to Sprout Social’s quick implementation and AI-powered features, our customers can proactively manage brand crises and get ahead of customer expectations in record time.

• Smart inbox.

We bring public and private messages from across social networks and profiles into a single, unified inbox.

This allows our customers to centralize interactions with their audiences

and customers and provides the necessary tools and workflows to deliver seamless customer experiences.

• Comprehensive case management :

Social Customer Care by Sprout Social empowers care teams to overcome organizational complexities and deliver timely, exceptional brand experiences.

Sprout Social consolidates billions of social conversations across social networks and review sites so teams can efficiently manage customer inquiries and go beyond customer expectations at scale through a robust Case management solution and AI-powered capabilities.

• Social CRM .

When interacting across social channels, context is important.

We provide historical conversations, notes and user information in-line so teams can generate responses that are relevant and productive.

• Social monitoring and alerts .

In addition to messages sent to our customers, our platform also captures messages relating to our customers, for awareness and response when needed.

We also provide an alerts engine to notify our customers when critical messages are received.

• Customer service tools .

Many of the messages received through social media are customer service related.

We provide tools to route and assign messages, and to measure the performance of our customer’s customer service efforts through social media.

• Automation .

solve business problems faster with social insights

Social media reporting promised a clear connection between social engagement and real business impact, yet many teams still find themselves lost in a tangled web.

Sprout Social’s analytics are designed to decode the value of social, transforming data into clear insights that help brands drive business impact, stay ahead of the competition and demonstrate real ROI.

Our robust reporting suite is designed for effortless customization, giving teams the power to showcase metrics that align with their organization’s unique objectives.

Thanks to Sprout Social’s proprietary algorithms that easily compare organic and paid reporting, teams can trust their insights are spot-on – essential for igniting adoption for shaping business strategies quickly.

• Comprehensive social media reporting .

Our customers can measure and analyze their performance across X, Facebook, Instagram, Pinterest and LinkedIn through rich experiences designed to extract actionable insights from data.

Our customers can measure and analyze their performance across all major social networks through rich experiences designed to extract actionable insights from data.

Reporting can be done across networks, analyzing paid and organic performance compared to historic and peer or competitor performance.

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Social Listening:

business intelligence at scale

Every day, hundreds of millions of data points are created across social networks that contain information that can help businesses better understand their markets, their customers and their

We provide affordable, powerful and approachable tools to access this rich data in order to make better business decisions.

Social data is a real-time focus group at a global scale.

power growth and set the industry standard with business intelligence at scale

Social is an indispensable source of business intelligence, where billions of data points are created across social networks that contain information that can help businesses better understand their markets, their customers and their competition.

Sprout Social provides real-time insights that can turn social listening into a competitive edge, empowering customers to anticipate trends and drive growth before the competition can react.

• Market research .

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Our customers can identify opportunities to differentiate their brand, products and services through competitor comparison, sentiment research and share of voice analysis.

This helps them to keep ahead of their competition.

This can help them to keep ahead of their competition.

• Consumer trends .

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Our customers can leverage these consumer insights to upgrade their customer experiences and refine products and services.

Influencer marketing:

Tagger by Sprout Social

Our influencer marketing product, Tagger by Sprout Social, allows brands and agencies to unlock the power of influencer marketing.

Tagger allows customers to analyze influencer marketing trends, social content, posts and profile data to define an influencer strategy, discover the right influencers to align to brand values and audience;

and activate, scale, manage, measure and report on campaigns.

Additional features:

As social media use expands throughout our customers’ organizations, their use-cases and needs expand.

Influencer Marketing by Sprout Social:

streamline end-to-end influencer campaign management

Sprout Social’s Influencer Marketing platform is designed to help brands and agencies grow, reach new audiences, and build authentic connections with customers.

Our platform makes it easy to launch and manage influencer marketing campaigns through customizable workflows.

With Affinity, our proprietary algorithm powered by machine learning and audience psychographics, brands can find the right influencers for their campaigns.

Affinity matches influencers to brands by analyzing similarities in audience interests across thousands of profiles, with the goal of ensuring that both the influencer and their audience are a good fit for the campaign.

The right influencer can drive authenticity, engagement, and stronger ROI.

When combined with Sprout Social, our Influencer Marketing platform helps brands boost targeted engagement, increase reach, and maximize business impact as part of their overall social strategy.

Employee Advocacy:

the fastest way to extend social reach

Sprout Social’s Employee Advocacy solution is designed to enable organizations to leverage the trust and influence of their employees to extend brand reach on social media.

By empowering employees to become authentic brand advocates, the solution can enhance an organization’s marketing efforts and provide a competitive edge through meaningful connections and streamlined workflows.

Employee Advocacy is built to simplify the process of content sharing and customizable newsletter creation, allowing employees to easily share relevant brand messages with their social networks.

The integration with Sprout Social's platform provides social teams with the tools that allow them to streamline operations and assess performance through actionable data.

Built for quick adoption, the Employee Advocacy solution is designed to support businesses in unlocking new opportunities, accelerating growth, and scaling success in the fast-moving digital landscape.

Additional capabilities:

As social media use expands throughout our customers’ organizations, their use cases and needs do too.

We respond to these increasing demands by continuously enhancing our platform and expanding our offering.

• Social Commerce .

Commerce transactions are shifting to social, which is a primary point of product discovery for consumers.

We allow brands to easily link their commerce platforms, currently Shopify and Facebook Shops, for a unified view of product catalogs, SKU availability and purchase history, which help inform proactive marketing efforts and create seamless, unified customer service experiences.

• Reputation management .

Brand reputations are being shaped by social media and customer review sites.

We provide customers a seamless, integrated solution to manage their reputation across review sites and social media.

• Employee advocacy .

An organization’s employees are highly trusted by their followers and can extend a brand’s reach on social media.

Our advocacy solutions allow our customers to distribute pre-approved content to their team to facilitate sharing across the individual’s social network.

Commerce transactions are shifting to social, now a primary point of product discovery for consumers.

We allow brands to easily link their commerce platforms, including Facebook Shops, Shopify, and WooCommerce, to Sprout Social to drive more sales opportunities and foster loyalty.

This eliminates unnecessary steps and shortens response times with personalized offers, thanks to a unified view of product catalogs, SKU availability and purchase history.

• Reputation and review management.

Brand perception is largely influenced by social media and customer review platforms.

Customers can quickly address any issues as they arise by responding promptly and building trust through thoughtful communication.

By actively monitoring reviews across key platforms—such as the Apple App Store, Facebook, Glassdoor, Google My Business, Google Play Store, Tripadvisor, Trustpilot, and Yelp—brands can gain valuable insights into customer sentiment and identify areas for improvement.

This proactive approach not only helps resolve crises but also strengthens relationships with customers and enhances brand loyalty.

• Mobile applications .

Social media is 24/7 and extends well beyond the work day.

Our mobile applications give our customers access to our platform on any current Android or iOS device.

• Chat bot creation and management .

Social media operates around the clock, extending well beyond traditional work hours.

To meet the needs of our customers, we offer mobile applications that provide full access to our platform on both Android and iOS devices.

This allows customers to manage and engage with their social media operations anytime, anywhere, enabling continuous responsiveness and support for their social media strategies.

• Chatbot creation and management .

To manage high volumes of customer messaging, we provide our customers with an intuitive interface to build and deploy chat experiences to help their audience get the information they need quickly and efficiently.

Following an initial 30-day free trial, our subscription-based model allows our customers to choose a core plan based on their needs and license the platform on a per user per month basis.

Our Market Opportunity

We also believe our platform addresses this significant capability gap, serving what we refer to as the social media management market.

We estimate that, based on our current average customer spending levels, the annual served addressable market (SAM) for our platform in 2023 exceeded $55 billion.

We estimate that our SAM opportunity will exceed $120 billion by 2025, an annual market growth rate of greater than 25%.

We calculated our current SAM estimate as follows:

(i) utilized data from The U.S.

Small Business Administration, The U.S.

(ii) utilized internal data and estimates to estimate the number of such businesses that require a social media management platform (the “Target Businesses”);

(iii) calculated the average of our annual contract value (ACV) and our estimate of our primary competitors’ ACVs in each segment;

and (iv) multiplied the estimated average segment ACVs by the estimated number of Target Businesses in each segment.

We then used internal

estimates informed by research from the Harris Poll to determine the projected business presence on social media in 2025 that will require a social media management platform, multiplied by our internal projected average segment ACVs in 2025 for Sprout Social and its direct competitors in the applicable segment.

Our Growth Strategies

We intend to capitalize on our large market opportunity with the following key growth strategies:

• Win with Enterprise customers.

We believe there is substantial opportunity to drive increased pipeline and strategic customer wins in accounts over $50,000 in annualized recurring revenue (ARR).

We plan to accomplish this through a product roadmap that is increasingly focused on the requirements of Enterprise customers and within our go-to-market strategy, by driving more awareness with senior executives.

We intend to release more features that will allow us to continue to meet the evolving needs of the largest enterprises and drive larger ACV transactions.

This includes more scale in our customer care product, deepening our listening analytics features and support for larger scale deployments.

We intend to drive increased accountability in the field, ensure we have appropriate resource allocation across our different customer and geographic segments, and strengthen the operational cadence of the go-to-market teams and their intersection with the rest of the company.

• Increase customer health by driving improved onboarding and adoption behaviors.

We want our customers to discover and deploy all of the deep value within our platform so they can leverage our most sophisticated capabilities, can integrate our platform into their core tech stack, and can leverage Sprout Social data to better understand their Social ROI.

We intend to deliver more strategic expert services, build and support more integrations, and help our customers to better measure and understand the impact of their work.

• Invest in our partnerships.

We will continue to invest in partnerships with strategic partners.

Relationships with global partners bring our team into larger, strategic accounts and expand our reach into some of the largest digital marketing budgets.

In addition, our go-to-market alignment with agencies remains a central component of our push into the enterprise market.

We continue to view this channel as a key contributor to ACV expansion.

• Further penetrate our customer base.

We intend to drive deeper penetration into our customer base, for both new and existing customers, with use case expansion and premium modules.

Seat expansion, both inside of departments and across use cases, AI capabilities, professional services and premium models such as Influencer Marketing, Listening, Premium analytics, and Advocacy serve as key growth levers.

We know social is incredibly horizontal and has wide utility and applicability across a business, and we believe we have a tremendous opportunity to help our customers capitalize on opportunities they haven’t tackled yet.

We offer a variety of subscription-based plans to provide customers with flexibility in accessing the full value of Sprout Social based on their specific needs.

To facilitate rapid adoption and demonstrate the platform’s impact on business growth, we encourage the majority of our customers to participate in an initial 30-day free trial.

This allows them to experience firsthand how Sprout Social can drive efficiency and performance.

For enterprise customers and organizations with large-scale social media operations, we offer managed trials that provide personalized support to help them realize the full value of the platform.

enterprises receive white-glove onboarding, a customized implementation plan, dedicated assistance for single sign-on (SSO) setup, and priority customer support.

Our platform is licensed on a per-user, per-month basis, providing scalability to meet the needs of businesses of all sizes.

Here is how it works:

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Customers add product modules (e.g., Listening) for an additional monthly rate depending on their needs.

We have a highly diverse base of over 31,000 current customers across SMBs, Mid-market companies, Enterprises and marketing agencies, as well as government, non-profit and educational institutions.

We have a highly diverse base of approximately 30,000 current customers across SMBs, Mid-market companies, Enterprises and marketing agencies, as well as government, non-profit and educational institutions.

We have been increasingly focused on the Mid-market and Enterprise segments, and we expect that our current and future growth will likely be driven by outsized contributions from Mid-market and Enterprise.

Aligning to this focus, we announced a price increase in November 2022, which values our software consistent with the expectations of these segments of the market.

As a result, our total number of customers or the number of net new customers we add each quarter may decrease even if the average spend of each new customer increases over time.

As a result, our total number of customers or the number of net new customers we have added each quarter following the price increase has decreased while the average spend of each new customer has increased.

We expect this trend to continue as we remain focused on our most sophisticated customers.

Sales and Marketing

Our go-to-market approach is driven by the effectiveness and innovation of our platform and unpaid customer demand.

Our model is focused on a product driven strategy, where potential customers are led to our website to sign up for a free trial or to request a demonstration of our products.

A subscription is designed to be easily purchased.

A substantial number of our customers subscribe without any interaction from our sales team.

This approach allows us to cost-effectively drive strong lead generation, upgrade free trials to paying subscription customers, drive strong conversion of demonstration requests and achieve growth of our platform.

As an organization realizes the strength of our platform, adoption of our products increases across the organization.

Our product is effective for nearly every part of an organization and the adoption of our platform spreads across departments through word of mouth.

Our go-to-market strategy continues to be driven by the strength and innovation of our platform, complemented by an expanded multi-product approach and deeper market segmentation.

We leverage a product-led strategy, allowing potential customers to engage with our platform through free trials and product demonstrations.

A significant portion of customers subscribing without direct sales intervention.

In 2025, we plan to enhance our go-to-market execution by prioritizing enterprise growth, multi-threaded sales motions, and targeted regional expansion.

Our strategic focus includes high-value enterprise deals, verticalized go-to-market strategies, and deeper customer engagement across industries.

We believe investments in influencer marketing, expanded partnerships, and international market development will further strengthen our ability to scale globally.

As customers recognize the value of our platform, adoption naturally expands across the departments of their organizations through word-of-mouth and demonstrated impact.

By aligning sales, marketing, and product teams around key growth initiatives, we continue to drive lead generation, increase conversion rates, and scale our platform's adoption across diverse customer segments.

We serve a large number of customers across industry and customer segments.

With our self-serve, inside and field sales strategies, we seek to efficiently provide each customer segment with an exceptional experience and efficient scalability.

Our marketing team is focused on generating awareness of our social media management platform and on inbound marketing through our industry leading blog and other social content, including our own large social media following.

The majority of inbound trials and demonstration requests are generated from unpaid marketing, allowing us to rapidly test, adapt and optimize our go-to-market for sustained growth.

The majority of inbound trials and demonstration requests are generated from unpaid marketing, allowing us to rapidly test, adapt and optimize our go-to-market motion.

As of December 31, 2024, our sales and marketing department had 700 employees.

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Customer Service

Our global support team provides support to all of our customers, regardless of spend or segment, in the channel they prefer.

Customer success has always been deeply rooted in our DNA and

we have been intentional with our focus on delivering an exceptional level of quality service to our customers.

As a result, we have the highest-rated customer support according to G2 when compared to our primary competitors.

We provide 24/7 support through email, telephone, chat and social media and weekend support through email and social.

We also offer support in English, Spanish, Portuguese and French to our global customer base.

Customer success is at the heart of our business, and our global support team is committed to providing exceptional service to all customers, regardless of size or segment.

We prioritize delivering high-quality support in the channels that customers prefer, ensuring a seamless experience across email, phone, chat, and social media.

We offer 24/5 support for both phone and chat inquiries.

Our team serves a global customer base in multiple languages, including English, Spanish, Portuguese, and French.

Customers consistently rate Sprout Social highly on the third-party review platform G2, where we have been consistently recognized for excellence in our category.

In 2024, we were honored with the #1 spot on G2 across all software products, reflecting our commitment to delivering superior value and performance for customers.

Our focus on customer success extends beyond just support.

With Sprout Social as their trusted partner, customers are able to gain deep insights into their social performance with exclusive access to The Arboretum, a dynamic community of over 10,000 members, where they can exchange insights and receive ongoing support.

Customers also benefit from educational resources and strategic guidance from our Premier Success team.

This holistic approach empowers customers to not only meet, but exceed their goals and drive the business impact they need from social.

Additionally, our on-demand help center supports customers in becoming self-sufficient without requiring ongoing support.

As of December 31, 2024, our customer service department had 58 employees.

Customer service costs are included in Cost of revenue within the Consolidated Statement of Operations and Comprehensive Loss.

Customer service costs are included in Cost of revenue within the Consolidated Statements of Operations.

Research and Development

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There are a number of established and emerging competitors in the social media management software market.

While the market remains fragmented, there has been increasing consolidation in recent years with rising barriers to entry.

While new companies join the market frequently, barriers to entry are high, with increased consolidation in recent years.

We consider the competitive differentiators in our market to be:

• all-in-one platform;

• scalability of the platform;

• Growth from social :

How well the platform helps customers grow their brand or business through social.

• Speed of adoption :

How quickly users can get started and feel comfortable using the platform.

• Human-centric AI and automation :

How well the platform uses AI and automation to make tasks easier for teams.

• Customer support:

The level of partnership and support the vendor provides to help customers succeed.

• Comprehensive solution :

Whether the platform provides everything teams need to successfully drive ROI from social.

• Scalability :

How easily the platform can grow with your business as it gets bigger.

• Ease of use, security and reliability:

• ease & cost to deploy and run the platform.

How intuitive the platform is, how secure data is, and how reliable the platform is day-to-day.

• Cost and deployment:

How effortless it is to set up and run the platform, in a way that delivers financial ROI.

We believe we compete favorably on all of these factors.

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We protect and enforce our intellectual property rights, including through litigation as necessary.

See “Risk Factors—Risks Related to our Business and Industry—Any failure to protect our intellectual property rights could impair our business.”

See “Risk Factors—Risks Related to Intellectual Property Matters—Inability or failure to protect our intellectual property rights could impair our business.”

Government Regulation

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The manner in which existing laws and regulations are applied in this environment, and how they will relate to our business in particular, both in the United States and internationally, is often unclear.

For example, we sometimes cannot be certain which laws will be deemed applicable to us given the global nature of our business, including with respect to such topics as data privacy and security, pricing, credit card fraud, advertising, taxation, content regulation and intellectual property ownership and infringement.

credit card fraud, advertising, taxation, content regulation and intellectual property ownership and infringement.

Our customers, and those with whom they communicate using our platform, upload and store data onto our platform, generally without any restrictions imposed by us.

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Data Privacy and Security Laws

In the ordinary course of our business, we may collect and process personal data.

In the ordinary course of our business, we collect and process personal data.

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 governing data privacy and security.

Such obligations may include, without limitation, the Federal Trade Commission Act, the California Consumer Privacy Act of 2018, as amended by the California Privacy Rights Act of 2020 (“CPRA”) (collectively, the “CCPA”), the Canadian Personal Information Protection and Electronic Documents Act, Canada’s Anti-Spam Legislation, the European Union’s General Data Protection Regulation 2016/679 (“EU GDPR”), and 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 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 actual or perceived noncompliance.

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

For example, the CCPA imposes obligations on covered businesses to provide specific disclosures related to the business’s collection, use, and disclosure of 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 or correct the individual’s personal data, and to opt out of certain personal data disclosures).

the CCPA provides for administrative fines and a private right of action for certain data breaches which may include an award of statutory damages.

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

European data privacy and security laws (including the EU GDPR and UK GDPR) impose significant and complex compliance obligations on entities that are subject to those laws.

For 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;

For example, these obligations include limiting personal data processing to only what is necessary for specified, explicit, and legitimate purposes;

requiring a legal basis for personal data processing;

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

See the section titled “Risk Factors—Legal and Regulatory Risks” 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 sections titled “Risk Factors—Risks Related to the Use of Technology” and “Risk Factors—Legal and Regulatory Risks” 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.

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Our customers can use our platform to upload and present a wide variety of content.

In general, our customer terms of service state that customers agree not to, nor authorize or permit any third parties to use our products to post, upload, link to, send, distribute, or store any content that is protected by copyright, trademark, or any other proprietary right without first having obtained all rights, permissions, and consents necessary to make such content available on or through our products.

In general, our customer terms of service state that customers agree not to, nor

authorize or permit any third parties to use our products to post, upload, link to, send, distribute, or store any content that is protected by copyright, trademark, or any other proprietary right without first having obtained all rights, permissions, and consents necessary to make such content available on or through our products.

As our business expands to other countries, we must respond to regional and country-specific intellectual property considerations, including takedown and cease-and-desist notices in foreign languages, and we must build infrastructure to support these processes.

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Culture and Workforce

Sprout Social was named a Best Place to Work in 2023 by the Glassdoor Employees' Choice award, marking the sixth time in seven years that we have received this recognition.

In the third quarter of 2023, Sprout Social was named to the 2023 Fortune Best Workplaces in Technology List.

This is Sprout Social’s second time being named to the prestigious list, which follows additional 2023 recognitions including Best Workplace for Millennials in Chicago, Best Medium Workplace and to the PEOPLE Companies that Care list.

As of December 31, 2023, we had a total of 1,383 full-time employees, including 308 employees located outside the United States.

None of our employees are represented by a labor union.

We have not experienced any work stoppages, and we consider our relations with our employees to be good.

Our commitment to our employees is to foster a culture that enables every member of the Sprout Social team to do their best work of their career and have fun along the way.

At Sprout Social, we aspire to create a world-class flexible-first hybrid experience that enables exceptional work, fosters belonging, and transcends location.

Our employees choose where they perform best - whether that’s from home, the office, or a mix.

We default to digital collaboration and async communication norms to stay connected and work effectively to solve hard problems, and also taking great care in creating meaningful connections while physically apart.

We equally see the value of in-person, human connection and prioritize opportunities that bring our distributed teams together to strengthen the bonds within our global community.

A key component of our flexible first hybrid model is our in-person strategy which brings the team together throughout the year through Team and Regional Meet Ups.

Additionally, we will continue to create community and engagement for those employees that live within commuting distance of our Dublin, Chicago and Seattle offices.

Employee Engagement & Development

We listen to our employees and use their feedback to shape our employee experience priorities.

Based on results from our internal employee survey, our employee engagement in 2023 remained above our industry benchmark.

Our commitment to leadership development and developing careers at Sprout Social continues to be a key focus area.

We continue to invest in leadership development at Sprout Social through our GOLD (Growth Oriented Leadership Development) program.

The program consists of ‘Ignite,’ which focuses on new leaders including those new to the role of leadership itself or to leadership at Sprout Social, ‘Evolve,’ which is tailored towards experienced managers and directors, and ‘Amplify’ which is designed for our most senior leaders.

In 2023 we also welcomed our second cohort of “Accelerate,” our DEI Leadership Accelerator Program.

This four-month experience is aimed at supporting the continued growth and retention of our United States-based BIPOC employees through a series of professional development, leadership and peer coaching, and networking opportunities.

In addition to supporting our leaders, in late 2023 we celebrated the one-year anniversary of the launch of The Career Studio, our career development resource center for all employees.

This is an approachable virtual hub of career development tools designed to empower all employees to take ownership of their career journey at Sprout Social.

We continue to invest in our Grow@ digital and on-demand platform, which provides education and development opportunities through internal programs and third party vendors.

Diversity, Equity and Inclusion

We continue to provide public transparency into where we stand, where we’ve progressed and where we need to improve in the areas of DEI through our DEI Demographic report.

Our most recent report was published in February 2024, and we intend to continue to report our progress against the initiatives identified on an ongoing basis.

We established a company-wide workforce diversity vision focused on increasing the representation of women globally and BIPOC employees in the United States through targeted hiring and retention efforts.

We regularly track, report progress and identify targeted interventions to support this vision.

We focus our sourcing efforts on underrepresented backgrounds including investing in strategic partnerships such as re:work training and hold our Recruitment Team accountable to prospective diverse

We actively recruit from Historically Black Colleges and Universities and Hispanic Serving Institutions, including partnering with student organizations that serve traditionally underrepresented groups in tech.

In 2023, we expanded our scholarship program to include the Hispanic Scholarship Fund (HSF), while continuing our scholarship program with the United Negro College Fund to provide scholarships for Black/African American students majoring in software engineering.

Scholarship recipients were also given the opportunity to interview for our Associate Software Engineering Program.

We run a formal DEI learning curriculum to increase DEI awareness and ensure employees support and help drive our DEI efforts.

This includes unconscious bias training for all new hires as part of their onboarding.

We also encourage employees to attend our company-wide DEI Guild meetings to discuss relevant topics such as inclusive strategies to manage stress and burnout, demystifying microaggressions and understanding the spectrum of health and happiness.

We have eleven Community Resource Groups (CRGs), which are volunteer-led groups centered around common identities and life experiences that work to serve the unique needs of their community members, foster a sense of belonging through connection, support and empathy.

Each group works with an executive sponsor and receives an annual budget to support their initiatives and our CRG co-leads are compensated for their efforts.

Social Impact

Our Sprout Social Serves Mission is to promote the equity and social justice of historically marginalized communities through advocacy, access to quality education and technology for good.

Last year, we donated approximately $575,000 to support these causes through various not-for-profits.

At Sprout Social, we are proud to be recognized as a Built In “Best Place to Work” in 2024—a testament to the exceptional people who make up our team.

This marks the sixth consecutive year we have received this honor, celebrating our commitment to fostering a workplace where employees feel inspired, valued, and empowered to thrive.

The annual Built In awards recognize companies across all sizes and industries, including both remote-first organizations and those in major tech markets across the U.S.

This recognition underscores the essence of our culture:

one rooted in inclusivity, innovation, and genuine care for one another.

This year, we are thrilled to have been named to three Built In Best Places to Work lists for 2024:

the 100 Best Large Places to Work in Chicago, the 100 Best Large Places to Work in Seattle, and the 100 Best Places to Work in Seattle.

These accolades are particularly meaningful because they reflect what employees value most—culture, benefits, and opportunities for growth.

They affirm that Sprout Social is not just a great place to work but a leader in shaping exceptional workplace experiences.

This achievement speaks to our team’s dedication, collaboration, and shared commitment to living our values every day.

At the heart of these accomplishments is our unwavering commitment to transparency and aligning our people strategy with our values.

Transparency in human capital management is not just a priority at Sprout Social;

it’s a cornerstone of who we are.

By integrating workforce strategies with business objectives, we strive to create an environment where people and businesses thrive together.

Every decision we make—whether about our product, our people, or our business—is guided by our values and vision for the future.

These principles keep us focused on making sustainable and equitable choices that drive meaningful outcomes for employees, customers, and stakeholders alike.

Our human capital initiatives are designed to empower every team member with the tools, support, and resources they need to succeed.

As we continue to push boundaries in employee engagement, development, and inclusion, we remain steadfast in fostering a workplace that inspires excellence and brings out the best in all of us.

Together, we are building a culture defined by trust, transparency, and shared success.

Our Workforce

As of December 31, 2024, Sprout Social employed 1,322 full-time team members, with an average tenure of 5.6 years.

Geographically, our workforce spanned multiple locations, with 308 team members based outside the United States.

Sprout Social also aspires to create a world-class, flexible, and inclusive hybrid culture that enables exceptional work and fosters belonging.

We prioritize opportunities to bring our distributed teams together through regional meetups, team gatherings at our offices twice a year, and local events such as Happy Hours and Breakfast Bars.

These moments foster meaningful connections within our global community, strengthening bonds and enhancing engagement.

Employee Development

Sprout Social’s commitment to employee growth was evident in 2024 through our robust learning and development programs.

Our Grow@ platform provided employees with access to a wealth of digital, on-demand learning resources.

Departments complemented these offerings with specialized training programs tailored to critical skills and competencies.

These efforts underscored our dedication to creating personalized and impactful development experiences.

Performance management remained a key area of focus, with all managers completing annual performance reviews for their teams.

In 2024, we reimagined our performance development framework, introducing biannual reviews, quarterly goal syncs, and structured talent reviews.

This refreshed approach emphasized objective performance criteria and alignment with strategic priorities, laying a strong foundation for our 2025 initiatives.

Engagement & Recognition

In 2024, we launched Sprout Social’s first Culture Survey to gain deeper insights into our organizational culture.

The survey achieved a 64% response rate, revealing high levels of trust and an Employee Net Promoter Score (eNPS) of 32.

These metrics highlight the strength of our workplace:

trust, measured at 77, places us in the second quartile of our survey provider’s benchmarks, demonstrating a solid foundation for employee confidence in leadership and the organization.

Our eNPS score, exceeding the SaaS industry average by 1 point and landing in the first quartile of benchmarks, reflects strong employee advocacy and satisfaction.

These findings informed our efforts to cultivate a culture aligned with our strategic goals and employee values.

Recognition remained a cornerstone of our engagement strategy.

Through our Value Awards, we celebrated employees who exemplified Sprout Social’s values.

Award recipients received a $2,000 prize and a $500 charitable donation to an organization of their choice, demonstrating our commitment to community impact.

Additionally, milestone anniversaries were marked with custom branded swag, fostering pride and connection among employees.

Total Rewards

We continue to evolve our reward programs to be market competitive and comprehensive to cover employees at every stage of their personal and professional path and are focused on keeping wellness as the foundation for all employees globally.

To recruit and retain the best talent in the marketplace, we routinely review and refresh our total rewards program and we rely on employee feedback to shape and evolve our offerings.

We strive to offer options that are competitive, locally relevant and provide the resources needed to live fully, healthily, and balanced in work and life.

Our benefits include comprehensive healthcare, a global parental leave program with an equal length of time for all parents, a generous PTO policy, retirement programs and additional resources to support employees' overall mental health and well-being.

We also offer a family planning benefit of $5,000 USD towards surrogacy and adoption.

In 2023 we introduced a Lifestyle Spending Account to support our employees' efforts to maintain a healthy and balanced lifestyle.

We continue to provide a stipend to all new employees to ensure an optimal home setup and provide a Wi-Fi reimbursement to all employees to support them in our hybrid work environment.

In addition to competitive salaries that are reviewed bi-annually against market-based data, we are committed to pay equity and perform a global pay equity analysis on an annual basis.

In 2023, we offered stock-based compensation awards for every new employee, regardless of role, and all employees, subject to certain tenure and performance requirements, were eligible to receive annual equity grants.

In addition, we provide an Employee Stock Purchase Plan (currently United States only) to provide the opportunity to purchase Sprout Social stock at a discounted price to further benefit from the financial success and growth of the Company.

Sprout Social’s total rewards philosophy in 2024 was built on a foundation of fairness, competitiveness, and holistic well-being, ensuring our employees feel valued and supported at every stage of their personal and professional journeys.

Our comprehensive benefits offerings reflect our commitment to enabling employees to thrive both inside and outside of work.

We provide globally competitive compensation packages, which include base salary, commission, and stock-based compensation.

Salaries are reviewed annually using market-based data to facilitate fairness and alignment with industry standards.

As part of our steadfast commitment to pay equity, we conduct annual global pay equity analyses to support fair and transparent employee compensation.

Additionally, our Employee Stock Purchase Plan (currently available in the U.S.) allows employees to share in Sprout Social’s financial success by purchasing stock at a discounted rate, reinforcing their stake in our collective growth.

Our benefits offerings are designed to meet the diverse needs of our workforce, providing comprehensive healthcare, generous PTO, and retirement plans with company matching.

To support employees in living fully and healthily, we offer income replacement plans, such as short- and long-term disability, as well as life insurance.

These benefits are tailored to local markets, ensuring relevance and accessibility for our global team.

In 2024, we continued to prioritize support for growing families, offering a $5,000 family planning benefit for surrogacy and adoption, as well as a global parental leave program that provides equal time off

for all parents.

Our global Lifestyle Spending Account empowers employees to prioritize their personal health and well-being, while new hire stipends for home office setups and ongoing Wi-Fi reimbursements enable productivity in our hybrid work environment.

Beyond the essentials, Sprout Social offers a range of additional well-being benefits that underscore our holistic approach to employee care.

These resources include financial wellness tools, legal support, identity theft protection, pet insurance, and backup care for children and elders.

By continually evaluating and evolving our rewards and benefits, we aim to provide an exceptional employee experience that drives engagement, retention, and long-term success.

Governance & Accountability

Ethical conduct and diverse representation among key decision-makers are at the heart of Sprout Social’s governance practices.

Our Environmental, Social and Governance (ESG) committee, which includes several members of our executive team, guides our efforts intentionally and impactfully.

We align our governance policies with stakeholder interests by adopting transparent practices, such as pay-for-performance disclosures and enhanced stock ownership guidelines for executive officers.

Our board evaluations and risk management programs further promote accountability and efficiency at every level.

Health, Safety & Wellbeing

The safety and well-being of our employees continued to be a top priority in 2024.

Our hybrid work model allowed employees to choose their ideal work environment, supported by ergonomic office stipends and flexible schedules.

We maintained rigorous safety protocols in our offices, equipping them with life-saving tools and ensuring secure access.

Sprout Social’s mental health resources included counseling services, financial wellness tools, and backup care options, reflecting our holistic approach to employee well-being.

These initiatives are designed to support our workforce in achieving balance and resilience.

Refreshed Values

At the start of 2025, Sprout Social renewed its values to reflect our bold ambitions and commitment to achieving extraordinary things.

But values don’t mean much if they’re just words.

Whether we lead a team, manage a project, or shape group dynamics, we all play a key role in bringing our values to life.

By actively embracing and demonstrating them, we strive to create an environment where we all thrive.

• Be a joy to work with.

In every customer interaction, we deliver exceptional value.

• Put your name on it.

We act with purpose, own our impact and consistently deliver exceptional results.

• Change the game.

We redefine what’s possible, act boldly and transform challenges into breakthroughs.

• All in, All together.

Collaboration, trust and inclusion power our success.

Together, we achieve more than we ever could alone.

Our values are more than just words.

They’re the foundation of our culture — the principles that guide our decisions and the behaviors that shape how we show up every day.

By integrating them into our daily work, meetings, feedback, recognition, and decision-making, we keep them alive and thriving.

When we live our values, we strengthen our culture and move Sprout Social forward, together.

Our Website and Availability of SEC Reports and Other Information

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We also intend to use certain social media profiles (including www.twitter.com/SproutSocial, www.facebook.com/SproutSocialInc, www.linkedin.com/company/sprout-social-inc-/, www.instagram.com/sproutsocial/) as a means of disclosing information about us to our customers, investors and the public.

While not all of the information that we post to the Sprout Investors website or to social media profiles is of a material nature, some information could be deemed to be material.

While not all of the information that we post to the Sprout Social Investors website or to social media profiles is of a material nature, some information could be deemed to be material.

Accordingly, we encourage investors, the media and others interested in Sprout Social to review the information that we share at the Investors link located at the bottom of the page on sproutsocial.com and to regularly follow our social media profiles.

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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.

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Item 1. Business