What changed in this filing

/stocks — the workspaceLOADING

Item 1A. Risk Factors

2025-08-06 compared with 2025-05-05 · 50 added, 48 removed, 558 unchanged (15% of the section changed)

15 unchanged sentences

• We face risks related to our international community of customers, which could increase as we seek to expand our international footprint.

• Acquisitions, investments, and other strategic transactions could result in operating difficulties and harm our business.

• If the market for independent talent and the services they offer does not grow, our business, operating results, and financial condition could be adversely affected.

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Clients have similarly diverse options to find and engage service providers, including other online or offline platforms, staffing firms and agencies, by engaging service providers directly, or by hiring temporary, full-time, or part-time employees directly or through an agency.

Clients may decrease or cease

their use of our work marketplace and our revenue may be adversely impacted for many reasons, including:

Clients may decrease or cease their use of our work marketplace and our revenue may be adversely impacted for many reasons, including:

if we fail to attract and retain talent;

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Moreover, sustaining our growth in future periods will become more difficult if macroeconomic uncertainty, elevated interest rates, and inflation persist.

For example, during the three months ended March 31, 2025, macroeconomic conditions adversely impacted GSV, which declined 2% compared to the same period in 2024.

For example, during the three and six months ended June 30, 2025, macroeconomic conditions impacted GSV, which declined 1%, respectively, compared to the same periods in 2024.

To manage any future growth, we must improve our systems, motivate and effectively manage and train our workforce, and successfully manage the risks, challenges, and uncertainties associated with our business.

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If there are unforeseen expenses associated with such realignments in our business strategies, and we incur unanticipated charges or liabilities, then we may not be able to effectively realize the expected cost savings or other benefits of such actions.

Any negative impacts resulting from changes to our business strategy, offerings, or pricing model could adversely impact our business, operating results, and financial condition.

negative impacts resulting from changes to our business strategy, offerings, or pricing model could adversely impact our business, operating results, and financial condition.

If we are unable to maintain our banking and payment partner relationships on favorable terms, or at all, our business could be adversely affected.

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We expect that bad actors will continue to attempt to use our marketplace to engage in unlawful or fraudulent conduct.

This conduct may include unauthorized or fraudulent acquisition or use of data, money laundering, moving funds to regions or persons restricted by sanctions or export controls, terrorist financing, fraudulent sale of services, bribery, breaches of security, extortion or use of ransomware,

distribution or creation of malware or viruses, and piracy or misuse of software and other copyrighted or trademarked content.

This conduct may include unauthorized or fraudulent acquisition or use of data,

money laundering, moving funds to regions or persons restricted by sanctions or export controls, terrorist financing, fraudulent sale of services, bribery, breaches of security, extortion or use of ransomware, distribution or creation of malware or viruses, and piracy or misuse of software and other copyrighted or trademarked content.

Our controls relating to customer identity verification and authentication and fraud detection are complex, require continuous improvement, and may not be effective in detecting and preventing misconduct.

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Disputes sometimes arise between talent and clients, including with respect to service standards, payment, confidentiality, work product, and intellectual property ownership and infringement.

If either party believes the contract terms were not met, the service agreements negotiated between our customers and

our default terms provide a mechanism for the parties to request assistance from us and, for some contracts, a third-party arbitrator.

If either party believes the contract terms were not met, the service agreements negotiated between our customers and our default terms provide a mechanism for the parties to request assistance from us and, for some contracts, a third-party arbitrator.

If customer disputes are not resolved amicably, the parties might escalate to formal proceedings.

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However, there can be no assurance that we will be successful in identifying, negotiating and consummating strategic transaction opportunities.

These transactions, even if undertaken and announced, may not close, including due to challenges in obtaining regulatory or other approvals.

These transactions, even if undertaken and announced, may not close on the anticipated timeline or at all, including due to challenges in obtaining regulatory or other approvals.

In addition, strategic transactions that do close may involve significant challenges, uncertainties, and risks, including:

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We cannot be sure that we will succeed in delivering enhancements or any new offerings or services or that any enhancements or new offerings or services will be successful or cost effective.

Even if we do introduce new offerings or services, we may experience a decline in revenue from our existing offerings that is not offset by revenue from the new offerings or services, and we may experience unintended negative effects from any modifications to our existing offerings, services, and features, including reduced client spend, diminished fill rates for projects on our work marketplace, errors and disruptions on our work marketplace, and customer dissatisfaction.

client spend, diminished fill rates for projects on our work marketplace, errors and disruptions on our work marketplace, and customer dissatisfaction.

We face intense competition and could lose market share to our competitors, which could adversely affect our business, operating results, and financial condition.

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These companies may use these advantages to offer products and services similar to ours at a lower price, develop competitive products, or respond more quickly and effectively than we do to new or changing opportunities, technologies, standards, regulatory conditions, or customer preferences or requirements.

In addition, in developing technology markets subject to dynamic and rapid technological change, varied business models, and frequent disruption by innovative online and offline entrants, businesses can easily and quickly launch online or mobile platforms and applications at nominal cost by using commercially available software or partnering with various established companies.

For all of these reasons, we may not

be able to compete successfully against our current and future competitors, in which case our business, operating results, and financial condition would be adversely impacted.

and quickly launch online or mobile platforms and applications at nominal cost by using commercially available software or partnering with various established companies.

For all of these reasons, we may not be able to compete successfully against our current and future competitors, in which case our business, operating results, and financial condition would be adversely impacted.

If internet search engines’ methodologies or other channels that we utilize to direct traffic to our website are modified to our disadvantage, or our search result page rankings decline for other reasons, our customer growth could decline.

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Any privacy or security incident experienced by us, our vendors, or our third-party partners could result in:

unauthorized access to, misuse of, or unauthorized acquisition of our, our personnel’s, or our customers’ data;

unauthorized access to, misuse of, or unauthorized acquisition of our, our personnel’s, or our customers’

the loss, corruption, or alteration of data;

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or damage to our computers or systems or those of our customers.

Any of these could expose us to claims, litigation, fines,

enforcement actions, other potential liability, and reputational harm.

Any of these could expose us to claims, litigation, fines, enforcement actions, other potential liability, and reputational harm.

In addition, significant unavailability of our work marketplace due to security breaches or other privacy and security incidents could cause customers to decrease or cease their use of our work marketplace.

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For example, our corporate headquarters and many key personnel are located in the San Francisco Bay Area, a region known for seismic activity and catastrophic fires.

As we expand, we will need an increasing amount of technical infrastructure and continued infrastructure modernization, including network capacity, computing power, and improvements to how we process and store data and transaction information.

store data and transaction information.

We also rely on third-party service providers and infrastructure, including the internet, to provide our work marketplace.

For example, we currently host our work

marketplace, serve our customers, and support our operations using Amazon Web Services, a provider of cloud infrastructure services.

For example, we currently host our work marketplace, serve our customers, and support our operations using Amazon Web Services, a provider of cloud infrastructure services.

We do not have control over the operations or the facilities of our third-party service providers, which are subject to risks of errors, defects, and disruptions.

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Our ability to attract and retain customers is dependent in part on the ease of use, trustworthiness, and reliability of our work marketplace, including our ability to provide high-quality support.

Our customers depend on our support organization to enforce our terms of service against bad actors, resolve any issues relating to our work marketplace, communicate effectively about their accounts, and assist in their use of our work marketplace, especially large enterprise clients, which expect higher levels of support.

In addition, customers of our Managed Services offering depend on our support organization to manage their projects and reach satisfactory project outcomes.

In addition, customers of our Enterprise business’s Managed Services offering depend on our support organization to manage their projects and reach satisfactory project outcomes.

Our ability to provide effective support is largely dependent on our ability to attract, resource, and retain service providers who are both qualified and well versed in our work marketplace.

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These changes may increase our costs or adversely affect customer experience.

Additionally, mobile operating systems, such as Android and iOS, could stop supporting our work marketplace or the ability to make payments on our work marketplace at all or on commercially reasonable terms or make changes that degrade the customer experience on our marketplace.

To deliver high-quality mobile offerings, it is important that our

offerings are designed effectively and work well with a range of mobile devices, technologies, systems, networks, and standards that are beyond our control.

Additionally, mobile operating systems, such as Android and iOS, could stop supporting our work marketplace or the ability to make payments on

our work marketplace at all or on commercially reasonable terms or make changes that degrade the customer experience on our marketplace.

To deliver high-quality mobile offerings, it is important that our offerings are designed effectively and work well with a range of mobile devices, technologies, systems, networks, and standards that are beyond our control.

In the event that it is inconvenient or impossible for our customers to access and use our work marketplace on their mobile devices or our competitors develop offerings and services that are perceived to operate more effectively on mobile devices, our business, operating results, and financial condition could be adversely impacted.

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Regulatory scrutiny on large companies, technology companies, and companies engaged in dealings with independent contractors, payments, or personal information and data has increased significantly and may continue to increase.

New and existing laws and regulations (or changes in interpretation of existing laws and regulations) may be adopted, implemented, or interpreted to apply to our business or our customers, including as a result of new products or features we may introduce or international expansion of our business.

New and existing laws and regulations (or changes in interpretation of existing laws and regulations) may be adopted, implemented, or interpreted to apply to our business or our customers, including as a result of new lines of business, products or features we may introduce or international expansion of our business.

In addition, these laws and regulations affect our customers and may affect demand for our work marketplace.

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We have in the past been, and may in the future be, subject to administrative inquiries and audits concerning our compliance with applicable laws and regulations, including the taxation and classification of our workers and the customers of our work marketplace.

Any failure or alleged failure by us or our employees, contractors, partners, customers, or agents to comply with applicable laws and regulations creates risk for our business and our employees, partners, contractors, and customers and could result in enforcement actions or other proceedings, criminal or civil

fines and penalties or other actions, civil lawsuits, forfeiture of significant assets, the limitation or suspension of our ability to operate our business or certain services in a particular jurisdiction, damages, interest, loss of export privileges, costs and fees (including legal fees), injunctions, loss of intellectual property rights, whistleblower complaints, termination of agreements by our partners, the diversion of management’s attention and resources, or reputational harm and adverse media coverage.

Any failure or alleged failure by us or our employees, contractors, partners, customers, or agents to comply

with applicable laws and regulations creates risk for our business and our employees, partners, contractors, and customers and could result in enforcement actions or other proceedings, criminal or civil fines and penalties or other actions, civil lawsuits, forfeiture of significant assets, the limitation or suspension of our ability to operate our business or certain services in a particular jurisdiction, damages, interest, loss of export privileges, costs and fees (including legal fees), injunctions, loss of intellectual property rights, whistleblower complaints, termination of agreements by our partners, the diversion of management’s attention and resources, or reputational harm and adverse media coverage.

Certain of these claims may not be covered by our insurance, and we cannot be certain that our insurance coverage will cover liabilities actually incurred or that insurance will continue to be available to us on economically reasonable terms, or at all.

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We receive, collect, store, process, transfer, and use personal information and other customer data.

There are numerous federal, state, local, and international laws and regulations regarding privacy, data protection, information security, and the collection, storing, sharing, use, processing, transfer, disclosure,

and protection of personal information and other data.

We are also subject to the terms of our privacy policies and legal and contractual obligations to third parties related to privacy, data protection, and information security.

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Any developments in the laws or regulations related to escrow, money transmission, or the handling, storing, or moving of money;

material changes to the mandate, purview or regulatory approach at the DFPI;

material changes to the mandate, purview or regulatory approach at the

or increased scrutiny of our business may lead to additional compliance costs and administrative overhead.

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In addition, various countries regulate the import and export of certain encryption and other technology, including imposing import and export permitting and licensing requirements, and have enacted and may enact laws that could limit our ability to distribute aspects of our work marketplace or could limit our customers’ ability to access our work marketplace in those countries.

Any change in import or export regulations or related legislation, or change in the countries, governments, persons, or technologies targeted by such regulations, could result in decreased use of our work marketplace by customers with international operations and adversely impact our business, operating results, and financial condition.

Any change in import or export regulations or related legislation, or change in the countries, governments, persons, or technologies

targeted by such regulations, could result in decreased use of our work marketplace by customers with international operations and adversely impact our business, operating results, and financial condition.

We are vulnerable to intellectual property infringement claims and challenges to our intellectual property rights brought against us by third parties.

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We also rely on trade secrets as an important aspect of our intellectual property program and to cover much of our technology and know-how.

We seek to protect our trade secrets and obtain rights in intellectual property developed by service providers through confidentiality and invention assignment or intellectual property ownership agreements with our employees, contractors, and other parties, as well as through implementing acceptable use policies, limiting access to our information and data through technological means, and monitoring and limiting the dissemination of our information and data outside of

company-owned information systems.

through implementing acceptable use policies, limiting access to our information and data through technological means, and monitoring and limiting the dissemination of our information and data outside of company-owned information systems.

These agreements and terms may not be enforceable or compliant with applicable law, and these agreements and other measures may not effectively protect our trade secrets and intellectual property rights.

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However, the amount of our estimates could be incorrect.

Any adverse determination related to a legal proceeding or adverse terms contained in a settlement agreement could require us to change our technology or our business practices in costly ways, prevent us from offering certain offerings or services, require us to pay monetary damages, fines, or penalties, or require us to enter into royalty or licensing arrangements, and could adversely affect our reputation, business, operating results, and financial condition.

arrangements, and could adversely affect our reputation, business, operating results, and financial condition.

If we are deemed to be an investment company under the Investment Company Act of 1940, our results of operations could be harmed.

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We have a history of net losses, may increase our operating expenses in the future, and may not be able to sustain profitability.

We have incurred net losses in the past, and as of March 31, 2025, we had an accumulated deficit of $40.7 million.

We have incurred net losses in the past, and as of June 30, 2025, we had an accumulated deficit of $8.0 million.

We have made, and expect to continue to make in the future, significant expenditures related to the development and expansion of our business.

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While our GSV and revenue have grown in recent years, we may not be able to sustain the same level of growth in future periods, or at all.

For example, during the three months ended March 31, 2025, macroeconomic conditions adversely impacted GSV, which declined 2% compared to the same period in 2024.

For example, during the three and six months ended June 30, 2025, macroeconomic conditions impacted GSV, which declined 1%, respectively, compared to the same periods in 2024.

In addition, although our profitability has improved in recent periods, if our revenue declines or fails to grow at a rate faster than increases in our operating expenses, we will not be able to maintain profitability in future periods and the trading price of our common stock could decline.

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Our operating results and performance metrics have fluctuated in the past and may fluctuate in the future, particularly in periods of macroeconomic uncertainty and elevated interest rates and inflation.

Our operating results and performance metrics in any given period can be influenced by numerous factors,

many of which are unpredictable or are outside of our control, including those described elsewhere in this “Risk Factors” section as well as the following:

Our operating results and performance metrics in any given period can be influenced by numerous factors, many of which are unpredictable or are outside of our control, including those described elsewhere in this “Risk Factors” section as well as the following:

• uncertainty regarding macroeconomic and political conditions and demand for our work marketplace;

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• the impact of reductions in our workforce or involuntary or voluntary separations, including claims against us from departing employees or others;

• fluctuations in gross margin and revenue, including as a result of fluctuations in the use of our Managed Services offering due to our recognition of the entire GSV from our Managed Services offering as revenue, including the amounts paid to talent;

• fluctuations in gross margin and revenue, including as a result of fluctuations in the use of our Enterprise business’s Managed Services offering due to our recognition of the entire GSV from the Managed Services offering as revenue, including the amounts paid to talent;

• the productivity, effectiveness, and efficiency of our sales force and the length and complexity of our sales cycles;

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Significant judgment is required to evaluate applicable tax obligations and in many cases the ultimate tax determination is uncertain because it is not clear how new and existing statutes might apply to our business.

For example, in July 2025, Public Law 119-21 was enacted, introducing changes to U.S.

tax law, and we are currently evaluating the impacts of this legislation on our condensed consolidated

financial statements.

As a result, we may recognize additional tax expense and be subject to additional tax liabilities, including other liabilities for tax collection obligations due to changes in federal, state, and international tax laws, statutes, rules, regulations, or ordinances;

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or changes to our business operations.

business to administer, assess, collect, and remit those taxes, and countries may propose or enact new laws that tax our or our customers’ activities in response to the imposition of new trade barriers.

Moreover, a number of countries and intergovernmental organizations have recently proposed, recommended, or enacted new laws or changes to existing laws that could impact our tax and reporting obligations or add new compliance costs to our business to administer, assess, collect, and remit those taxes, and countries may propose or enact new laws that tax our or our customers’ activities in response to the imposition of new trade barriers.

These changes may happen with little or no advance notice or implementation time, which can increase various short term costs of compliance.

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To support our growth and business strategy, such as developing new features or enhancements to our work marketplace, acquiring new technologies, and improving our infrastructure, we have made and expect to continue to make significant financial investments in our business.

In addition, we may, from time to time, seek to acquire or strategically invest in other complementary products, technologies, or businesses or repurchase outstanding shares of our common stock or the Notes.

For example, during the fiscal year ended December 31, 2024, we paid $100.0 million to repurchase shares of our common stock under the 2023 Share Repurchase Authorization, and as of March 31, 2025, we had $66.9 million available for repurchases of our common stock under the 2024 Share Repurchase Authorization.

In addition, we may, from

time to time, seek to acquire or strategically invest in other complementary products, technologies, or businesses or repurchase outstanding shares of our common stock or the Notes.

For example, during the fiscal year ended December 31, 2024, we paid $100.0 million to repurchase shares of our common stock under the 2023 Share Repurchase Authorization, and as of June 30, 2025, we had $29.1 million available for repurchases of our common stock under the 2024 Share Repurchase Authorization.

We may need to engage in equity or debt financings to obtain the funds required for these investments, acquisitions, and other business endeavors.

If we raise additional funds through equity or convertible debt

issuances, our existing stockholders may suffer significant dilution and these securities could have rights, preferences, and privileges that are superior to those of holders of our common stock.

If we raise additional funds through equity or convertible debt issuances, our existing stockholders may suffer significant dilution and these securities could have rights, preferences, and privileges that are superior to those of holders of our common stock.

If we obtain additional funds through debt financing, we may not be able to obtain such financing on terms favorable to us.

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Share repurchases could also increase the volatility of the trading price of our common stock and diminish our cash reserves.

In October 2024, our board of directors authorized $100.0 million for share repurchases under the 2024 Share Repurchase Authorization and we had $66.9 million available for repurchases under the 2024 Share Repurchase Authorization as of March 31, 2025.

In October 2024, our board of directors authorized $100.0 million for share repurchases under the 2024 Share Repurchase Authorization and we had $29.1 million available for repurchases under the 2024 Share Repurchase Authorization as of June 30, 2025.

The actual timing and amount of any repurchases under the 2024 Share Repurchase Authorization will depend on a variety of factors, including stock price, trading volume, market and business conditions, regulatory requirements, and other considerations, all of which may be impacted by factors outside of our control.

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The Notes will mature on August 15, 2026, unless earlier redeemed, repurchased, or converted in accordance with the terms of the Notes.

In March 2023, we repurchased a portion of the outstanding Notes, and, as of March 31, 2025, $361.0 million aggregate principal amount of the Notes remained outstanding.

In March 2023, we repurchased a portion of the outstanding Notes, and, as of June 30, 2025, $361.0 million aggregate principal amount of the Notes remained outstanding.

We may also incur additional indebtedness to meet future financing needs.

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Moreover, there can be no assurances that any future tariffs or similar levies, or responses to those tariffs or levies, will not directly impact our business and the services that talent on our marketplaces provide to our clients.

There is also a risk that when overall global economic conditions are positive, our business could be negatively impacted by a decreased demand for talent as businesses utilize more full-time employees relative to their use of independent contractors.

There is also a risk that when overall global economic conditions are positive, our business could be negatively impacted by a decreased

demand for talent as businesses utilize more full-time employees relative to their use of independent contractors.

We cannot predict the timing, strength, or duration of any economic slowdown, or any subsequent recovery generally.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1A. Risk Factors