What changed in this filing

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Item 1A. Risk Factors

2022-03-18 compared with 2021-03-16 · 168 added, 151 removed, 666 unchanged (32% of the section changed)

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Risks Related to Our Business and Industry

• Our revenue growth rate in recent periods may not be indicative of our future performance.

• We have a history of losses and may not achieve profitability in the future.

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• Because we recognize revenue from subscriptions for our platform over the term of the subscription, downturns or upturns in new business may not be immediately reflected in our operating results.

• Our revenue growth rate in recent periods may not be indicative of our future performance.

• We have a limited operating history and our business has evolved, which makes it difficult to predict our future operating results.

• We have experienced rapid growth and significant changes to our organization and structure and may not be able to effectively manage such growth.

• Failure to adequately maintain and scale our sales force will impede our growth.

• Failure to adequately scale our sales force will impede our growth.

• We have expanded and intend to continue to expand our international operations, which exposes us to significant risks.

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Risks Related to Our Business and Industry

Our revenue growth rate in recent periods may not be indicative of our future performance.

We experienced revenue growth rates of 31% from the fiscal year ended January 31, 2019 to the fiscal year ended January 31, 2020, 19% from the fiscal year ended January 31, 2020 to the fiscal year ended January 31, 2021, and 10% from the fiscal year ended January 31, 2021 to the fiscal year ended January 31, 2022.

However, we expect our growth in the coming year to be slower.

Our historical revenue growth rates are not indicative of future growth, and we may not achieve similar revenue growth rates in future periods.

You should not rely on our revenue for any prior quarterly or annual periods as an indication of our future revenue or revenue growth.

Our operating results may vary as a result of a number of factors, including our ability to execute on our business strategy, our ability to compete effectively for customers and business partners, the impact of the COVID-19 pandemic on our business, and other factors that are outside of our control.

If we are unable to maintain consistent revenue or revenue growth, our stock price could be volatile, and it could be difficult to achieve or maintain profitability.

We have a history of losses and may not achieve profitability in the future.

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As a result, we may continue to experience operating losses for the indefinite future.

Further, we expect our operating expenses to increase over the next several years as we hire additional personnel, incur additional expenses associated with our new and expanded facilities, expand our distribution channels, develop our technology and new features and face increased compliance costs associated with our growth and entry into new markets and geographies and operations as a public company.

Further, we expect our operating expenses to increase over the next several years as we hire additional personnel, incur additional expenses associated with our expanded facilities, expand our distribution channels, develop our technology and new features, face increased compliance costs associated with our growth and entry into new markets and geographies and adopt new systems to scale and automate our operations.

If our revenue does not increase to offset these and other potential increases in operating expenses, we may not be profitable in future periods.

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The effects of the COVID-19 pandemic have had and are expected to continue to have an adverse effect on our business, operations and financial results as well as the business and operations of our customers and potential customers.

The COVID-19 pandemic has disrupted business operations for us and our customers, suppliers, vendors and other parties with whom we do business and such disruptions are expected to continue for an indefinite period of time.

In an effort to control the spread of COVID-19, governments and municipalities around the world have instituted restrictive measures, including orders to shelter-in-place, travel restrictions, and mandated business closures.

The pandemic and resulting governmental restrictions and regulations have adversely affected businesses, economies, and financial markets globally, leading to an economic downturn, a sharp increase in unemployment and increased market volatility.

As a result of the COVID-19 pandemic, the operation of our business has been disrupted.

We have temporarily closed our offices requiring all employees globally to work remotely.

We have restricted non-essential business travel and canceled in-person marketing events, including our annual industry and customer event ONWARD20.

While we continue to monitor regional developments relating to the COVID-19 pandemic to inform decisions on office re-openings and lifting of travel restrictions, these efforts may not be successful and may require additional costs.

The uncertain duration of these measures have had and may continue to have increasingly negative effects on our sales efforts and revenue growth rates.

In addition, our management team has, and will likely continue, to spend time, attention and resources monitoring the COVID-19 pandemic and seeking to manage its effects on our business and workforce.

The COVID-19 pandemic has had and we believe will continue to have a negative impact on our sales activities including our ability to attract, retain and sell additional products and features to our customers.

In response to the COVID-19 pandemic some existing and potential customers, in particular among those in industries highly impacted by the pandemic, such as retail and food services as well as certain geographies such as Europe, have and we expect other customers may reduce, suspend or delay technology spending, request to renegotiate contracts to obtain concessions such as extended billing and payment terms, shorten the duration of

contracts or elect not to renew their subscriptions.

The COVID-19 pandemic has significantly disrupted business operations for us and our customers as well as suppliers, and other parties with whom we do business.

Such disruptions are expected to continue for an indefinite period of time.

We have adopted several measures in response to the COVID-19 pandemic and continue to monitor regional developments to inform our operational decisions.

Our offices have been open on a voluntary basis in accordance with guidance provided by government agencies, although currently the majority of our employees are still working remotely.

While we continue to hold virtual events, we have also resumed in-person marketing events.

We continue to monitor regional developments relating to the COVID-19 pandemic to inform operational decisions, but these efforts may not be successful and may require additional costs.

The uncertain duration of these measures have had and may continue to have negative effects on our sales efforts and revenue growth rates.

In addition, our management team has, and

will likely continue, to spend time, attention and resources monitoring the COVID-19 pandemic and seeking to manage its effects on our business and workforce.

In response to the COVID-19 pandemic some existing and potential customers, in particular customers in industries that have been highly impacted by the pandemic, such as retail and food services as well as certain geographies such as Europe, have and we expect other customers may reduce, suspend or delay technology spending, request to renegotiate contracts to obtain concessions such as extended billing and payment terms, shorten the duration of contracts or elect not to renew their subscriptions.

If additional customers or potential customers take similar actions, our operating results and financial condition may be materially adversely impacted.

Because our platform is offered as a subscription-based service and we generally recognize revenue from our customer contracts ratably over the term of the contract, changes in our contracting activity in the near term may not be fully reflected in our results of operations and overall financial performance until future periods.

The COVID-19 pandemic and measures taken to control its spread may adversely affect other aspects of our business as described in this “Risk Factors” section.

The COVID-19 pandemic including its variants and measures taken to control its spread may adversely affect other aspects of our business as described in this “Risk Factors” section.

As a result of the scale of the pandemic and measures taken to control its spread, our financial and operating results have been adversely affected and may differ materially from our historical results, and such adverse results may continue or worsen.

Further, even though some governments have begun to relax COVID-19 related restrictions, any recovery from the COVID-19 pandemic and related economic impact may be slowed or reversed by a variety of factors, such as, the spread of new variants of the COVID-19 virus.

Even after the COVID-19 pandemic has subsided, we may continue to experience adverse impacts to our business as a result of its global economic impact.

Further, many of the factors discussed in this “Risk Factors” section are, and we anticipate will continue to be further, heightened or exacerbated by the impact of the COVID-19 pandemic.

Because we recognize revenue from subscriptions for our platform over the term of the subscription, downturns or upturns in new business may not be immediately reflected in our operating results.

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Our subscription model also makes it difficult for us to rapidly increase our revenue through additional sales in any period, as revenue from new customers must be recognized over the applicable subscription term.

Our revenue growth rate in recent periods may not be indicative of our future performance.

We experienced revenue growth rates of 34% from the fiscal year ended January 31, 2018 to the fiscal year ended January 31, 2019, 31% from the fiscal year ended January 31, 2019 to the fiscal year ended January 31, 2020, and 19% from the fiscal year ended January 31, 2020 to the fiscal year ended January 31, 2021.

Our historical revenue growth rates are not indicative of future growth, and we may not achieve similar revenue growth rates in future periods.

You should not rely on our revenue for any prior quarterly or annual periods as an indication of our future revenue or revenue growth.

If we are unable to maintain consistent revenue or revenue growth, our stock price could be volatile, and it could be difficult to achieve or maintain profitability.

We have a limited operating history and our business has evolved, which makes it difficult to predict our future operating results.

Our business has evolved, which makes it difficult to predict our future operating results.

We were incorporated in 2006 and originally operated as an advertising services company.

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Many of the most popular features of our platform have only been launched in the past few years.

As a result of our limited operating history and recent changes to our platform and our sales model, our ability to forecast our future operating results is limited and subject to a number of uncertainties, including our ability to plan for and model our future growth.

As a result of recent changes to our platform and our sales model, our ability to forecast our future operating results is limited and subject to a number of uncertainties, including our ability to plan for and model our future growth.

The dynamic nature of our business and our industry may make it difficult to evaluate our current business and future prospects, and as a result our historical performance should not be considered indicative of our future performance.

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We increased the number of our full-time employees from over 450 as of January 31, 2016 to over 1,400 as of January 31, 2022 and have hired several members of our senior management team in recent years.

In March 2022, we announced that our Chief Executive Officer, Howard Lerman, and our Chief Financial Officer, Steven Cakebread will resign effective March 25, 2022, and that our Chairman, Michael Walrath, and our Chief Accounting Officer, Darryl Bond, will succeed as Chief Executive Officer and Chief Financial Officer, respectively.

We believe that our corporate culture has been a critical component of our success.

We have invested substantial time and resources in building our team and nurturing our culture.

As we expand our business and operate as a public company, we may find it difficult to maintain our corporate culture while managing our personnel growth.

As we expand our business and operate as a public company, we may find it

difficult to maintain our corporate culture while managing our personnel growth.

Any failure to manage our anticipated growth and organizational changes in a manner that preserves the key aspects of our culture could hurt our chance for future success, including our ability to recruit and retain personnel and effectively focus on and pursue our corporate objectives.

Furthermore, as a result of the COVID-19 pandemic, our corporate culture may be difficult to maintain as all our global offices are temporarily closed and all employees globally work from home.

Furthermore, as a result of the COVID-19 pandemic, our corporate culture may be difficult to maintain as the majority of our employees are working remotely.

In addition, to manage the growth of our headcount, customer-base and operations, we will need to continue to improve our information technology infrastructure and our operational, financial and management systems and procedures.

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If we fail to successfully manage our growth, we likely will be unable to successfully execute our business strategy, which could have a negative impact on our business, operating results and financial condition.

Failure to adequately maintain and scale our sales force will impede our growth.

Failure to adequately expand and scale our sales force will impede our growth.

Our revenue growth is substantially reliant on our sales force.

Much of our sales process is relationship-driven, which requires a significant sales force.

While we plan to maintain and scale our direct sales force, both domestically and internationally, we have historically had difficulty recruiting and retaining a sufficient number of sales personnel.

If we are unable to adequately scale our sales force, we will not be able to reach our market potential and execute our business plan.

While we plan to expand and scale our sales force, both domestically and internationally, we have historically had difficulty recruiting and retaining a sufficient number of sales personnel, and this difficulty has heightened during the COVID-19 pandemic.

If we are unable to adequately expand and scale our sales force, we will not be able to reach our market potential and execute our business plan.

Identifying and recruiting qualified sales personnel and training them on our products requires significant time, expense and attention.

Our financial results will suffer if our efforts to scale and train our direct sales force do not generate a corresponding increase in revenue.

We have hired a significant number of direct sales personnel in recent years.

If new direct sales personnel are unable to achieve desired productivity levels in a reasonable period of time, including as a result of the COVID-19 pandemic or if we are unable to retain and develop talented sales personnel, we may not be able to realize the expected benefits of this investment or increase our revenue.

Our financial results will suffer if our efforts to expand, scale and train our sales force do not generate a corresponding increase in revenue.

We have hired a significant number of sales personnel in recent years.

If new sales personnel are unable to achieve desired productivity levels in a reasonable period of time, including as a result of the COVID-19 pandemic or if we are unable to retain and develop talented sales personnel, we may not be able to realize the expected benefits of this investment or increase our revenue.

We have expanded and intend to continue to expand our international operations, which exposes us to significant risks.

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• potentially greater difficulty collecting accounts receivable and longer payment cycles;

• the need to adapt and localize our products for specific countries, including differences in the location attributes and formats used in each country and differences in languages, for example in the case of our site search product, which relies on natural language processing;

• the need to adapt and localize our products for specific countries, including differences in the location attributes and formats used in each country and differences in languages, for example in the case of our search product, which relies on natural language processing;

• the need to develop integrations with new third-party applications used by international customers;

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laws and regulations for foreign operations, including, without limitation, the Foreign Corrupt Practices Act, or FCPA, the U.K.

Bribery Act, import and export control laws, tariffs, trade barriers, economic sanctions and other regulatory or contractual limitations on our ability to sell in certain foreign markets, and the risks and costs of non-compliance;

Bribery Act, import and export control laws, tariffs, trade barriers, economic sanctions

and other regulatory or contractual limitations on our ability to sell in certain foreign markets, and the risks and costs of non-compliance;

• compliance with international laws and regulations, including without limitation, those governing privacy, data security and data transfer, such as the General Data Protection Regulation, or GDPR, which may impair our ability to grow our business or offer our service in some locations, may subject us to liability for non-compliance or may require us to change our business practices;

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• political or social unrest or economic instability in a specific country or region in which we operate, which could have an adverse impact on our operations in that location.

In particular, in February 2022, Russia launched a large-scale military attack on Ukraine.

The invasion significantly amplified already existing geopolitical tensions among Russia, Ukraine, Europe, NATO and the West, including the United States.

It is not possible to predict the full extent of the broader consequences of Russia’s invasion of Ukraine, which could include sanctions, embargoes, regional instability, geopolitical shifts and adverse effects on macroeconomic conditions, currency exchange rates and financial markets.

Our business, financial condition and results of operations may be materially adversely affected by any negative impact on the global economy and capital markets resulting from such conflict.

Also, our network service provider fees outside of the United States are generally higher than domestic rates, and our gross margin may be affected and may fluctuate as we expand our operations and customer base worldwide.

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These application providers provide us with direct access to update content on their websites and applications.

This direct access enables us to control our customers' business listings on the Knowledge Network application providers' websites and applications and to push real-time or nearly real-time updates to those business listings.

This direct access enables our customers to control their business listings on the Knowledge Network application providers' websites and applications and to push real-time or nearly real-time updates to those business listings.

In order to maintain relationships with application providers, we may need to modify our products or strategies in a way that may be adverse to our business and financial results.

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In order to grow our business, we anticipate that we will need to continue to maintain and potentially expand these relationships.

We may be unsuccessful in renegotiating our agreements with these third-party application providers or third-party application providers may insist on fees to access their applications.

We may be unsuccessful in renegotiating our agreements with these third-party application providers or third-party application

providers may insist on fees to access their applications.

Additionally, our contracts with these third-party application providers may be canceled after a notice period or may not be renewed, and we could lose access to these resources without having sufficient time to replace them.

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If we are unsuccessful in establishing or maintaining our relationships with third-party application providers, our ability to compete in the marketplace or to grow our revenue could be impaired and our operating results could suffer.

We do not have a long history with our pricing models and changes could adversely affect our operating results.

We have limited experience with respect to determining the optimal prices and contract length for our platform.

Changes to our pricing models could adversely affect our operating results.

Any changes we make to our pricing models could adversely affect our operating results.

For example, we recently began offering capacity-based pricing for our Pages and Answers products.

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Furthermore, as the markets for our features grow, as new competitors introduce new products or services that compete with ours or reduce their prices, or as we enter into new international markets, we may be unable to attract new customers or retain existing customers at the same price.

Moreover, large customers, which have historically been the focus of our direct sales efforts, may demand greater price discounts.

Moreover, large customers, which have historically been the focus of our sales efforts, may demand greater price discounts.

As we expand internationally, we also must determine the appropriate price to enable us to compete effectively internationally.

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The market for our features is competitive, rapidly evolving and fragmented, and is subject to changing technology and shifting customer needs.

Many vendors develop and market products and services that compete to varying extents with our features, and we expect competition in our market to intensify.

Moreover, industry consolidation may increase competition.

Additionally, new entrants, specifically application providers, that enter our markets through acquisitions or otherwise, would increase competition in our markets significantly.

Many companies develop and market products and services that compete to varying extents with our features, and we expect competition in our market to intensify.

As we develop our platform, we will introduce products and features that compete in new markets and as a result we will face new competitors.

For example, in October 2019 we launched Answers, our site search product, which competes with other search products.

We currently face many competitors with a variety of product offerings.

For example, in October 2019 we launched Answers, our search product, and as a result we face competition from established companies in enterprise search.

We believe that our ability to compete depends upon many factors both within and beyond our control, including product capabilities, such as speed, scale, and relevance, with which to power search experiences;

ease of deployment and ease of use;

adoption of our products by many types of users such as developers, IT professionals, and organizational leaders;

and low total cost of ownership.

Our competitors in enterprise search may have greater experience in these areas as well as greater name recognition, more established relationships with current and potential customers and larger customer bases.

As a result, potential customers may be unwilling to use or switch to our product.

We also face many other competitors with a variety of product offerings.

These companies have developed, or are developing, products that currently, or in the future are likely to, compete with some or all of our features.

Also, a number of potential new competitors, including those with longer operating histories, greater name recognition, more established customer bases or significantly greater financial, technical, marketing and other resources than we do, may decide to create or acquire products that compete with our platform or products or we may develop products that compete with their existing platforms.

A number of potential new competitors, such as application providers, that enter our markets through acquisitions or otherwise, may decide to create or acquire products that compete with our platform or we may develop products that compete with their existing platforms.

Moreover, industry consolidation may increase competition.

Some of these current and potential competitors may have longer operating histories, greater name recognition, more established relationships with current and potential customers, larger customer bases or significantly greater financial, technical, marketing and other resources than we do.

As a result, our competitors may be able to respond more quickly and effectively than we can to new or changing opportunities, technologies, standards or customer requirements.

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Concerns about cost, security, reliability and other issues may cause businesses and professional service providers not to adopt our platform.

Moreover, businesses and professional service providers who have already invested substantial resources in other marketing strategies and data

management systems or methods may be reluctant to adopt a new approach like ours to supplement or replace existing systems or methods.

Moreover, businesses and professional service providers who have already invested substantial resources in other marketing strategies and data management systems or methods may be reluctant to adopt a new approach like ours to supplement or replace existing systems or methods.

If businesses and professional service providers do not widely adopt software such as ours, our ability to grow our business will be limited.

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Our renewal rates may decline or fluctuate as a result of a number of factors, including limited customer resources, changes in our pricing and subscription models, customer satisfaction with our platform, the acquisition of our customers by other companies and deteriorating general economic conditions.

For example, as a result of the COVID-19 pandemic certain customers have reduced their subscriptions, elected not to renew their subscriptions, reduced length of contracts, requested extended billing and payment terms or sought more favorable rates.

As a result of the COVID-19 pandemic certain customers reduced their subscriptions, elected not to renew their subscriptions, reduced length of contracts, requested extended billing and payment terms or sought more favorable rates, and certain of these trends contributed to a general decline in our trailing twelve month dollar-based net retention rate.

If our customers do not renew their subscriptions for our platform or decrease the amounts they spend with us, our revenue will decline and our business will suffer.

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As a result, we may be unable to attract new customers at rates or on terms that would be favorable or comparable to prior periods, which could negatively affect the growth of our revenue.

Furthermore, we have canceled in-person customer and industry events including ONWARD, our annual industry and customer event, as a result of the COVID-19 pandemic.

We have also allocated marketing resources to focus on virtual events, virtual lead generation, and tools to help our sales personnel connect virtually with customers and potential customers.

We have also allocated marketing resources to virtual events, virtual lead generation, and tools to help our sales personnel connect virtually with customers and potential customers.

These new marketing efforts may not be successful and may not attract as many new customers as our historical customer and industry events, which could harm our future revenue and revenue growth.

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In addition, an increasing number of customers are utilizing mobile devices to access the internet and conduct business.

If we cannot continue to effectively make our platform available on these mobile devices and offer the information, services and functionality required by enterprises that widely use mobile devices, we may experience difficulty attracting and retaining customers, which could negatively affect our revenue.

continue to effectively make our platform available on these mobile devices and offer the information, services and functionality required by enterprises that widely use mobile devices, we may experience difficulty attracting and retaining customers, which could negatively affect our revenue.

If we are unable to successfully develop and market new features, make enhancements to our existing features, or expand our offerings into new markets, our business, results of operations and competitive position may suffer.

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Such efforts will require adding new functionality and responding to technological advancements, which will increase our research and development costs.

If we are unable to develop new features that address our customers' needs, or to enhance and improve our platform in a timely manner, we may not be able to maintain or increase market acceptance of our platform.

If we are unable to develop new features that address our customers' needs, or to enhance and

improve our platform in a timely manner, we may not be able to maintain or increase market acceptance of our platform.

Our ability to grow is also subject to the risk of future disruptive technologies.

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If customers do not expand their use of our platform beyond their current subscriptions and licenses, our ability to grow our business and operating results may be adversely affected.

Our ability to grow our business depends in part on our ability to encourage current and future customers to subscribe to our higher priced packages with more extensive features.

Our ability to grow our business depends in part on our ability to encourage current and future customers to subscribe to our higher priced packages with more extensive features or to purchase greater capacity.

If we fail to achieve market acceptance of new features, or if a competitor establishes a more widely adopted platform, our revenue and operating results will be harmed.

In addition, customers may initially purchase licenses for only a portion of the locations or entities that comprise their business.

If these customers do not expand the number of licenses managed with our platform, our revenue and operating results will be harmed.

In addition, customers may initially purchase licenses for only a portion of the locations or entities that comprise their business or a limited amount of capacity.

If these customers do not expand the number of licenses managed with our platform or purchase additional capacity, our revenue and operating results will be harmed.

Because our platform is sold to enterprises that often have complex operating environments, we may encounter long and unpredictable sales cycles, which could adversely affect our operating results in any given period.

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A delay in or failure to complete sales could harm our business and financial results, and could cause our financial results to vary from period to period.

Our sales cycle varies widely, reflecting differences in potential customers' decision-making

processes, procurement requirements and budget cycles, and is subject to significant risks over which we have little or no control, including:

Our sales cycle varies widely, reflecting differences in potential customers' decision-making processes, procurement requirements and budget cycles, and is subject to significant risks over which we have little or no control, including:

• customers' budgetary constraints and priorities;

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• the length and timing of customers' approval processes.

Our typical direct sales cycles for more substantial enterprise customers can often be long, and we expect that this lengthy sales cycle may continue or could even increase.

Our typical sales cycles for more substantial enterprise customers can often be long, and we expect that this lengthy sales cycle may continue or could even increase.

In the large enterprise market, the customer’s decision to use our platform may be an enterprise-wide decision or may require the approval of senior management, which may not only lengthen the sales cycle but also reduce the likelihood of completing a sale.

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Delayed and more complex sales cycles could cause our operating results and financial condition to suffer in a given period.

If we cannot adequately scale our direct sales force, we will experience further delays in signing new customers, which could slow our revenue growth.

If we cannot adequately expand and scale our sales force, we will experience further delays in signing new customers, which could slow our revenue growth.

A portion of our revenue is dependent on a few customers.

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In addition, our third-party reseller customers, which often sell to small and midsized organizations that can have liquidity and expense limitations, are also susceptible to global economic weakness and uncertainty, including as a result of the COVID-19 pandemic.

See also "—If customers do not renew their subscriptions for our platform or if they reduce their subscriptions at the time of renewal, our revenue will decline and our business will suffer." Lower demand from certain of our reseller customers has and may continue to result in them not renewing their subscriptions with us, purchasing fewer licenses, attempting to renegotiate contracts to obtain concessions and requesting extended billing and payment terms.

See also "—If customers do not renew their subscriptions for our platform or if they reduce their subscriptions at the time of renewal, our revenue

will decline and our business will suffer." Lower demand from certain of our reseller customers has and may continue to result in them not renewing their subscriptions with us, purchasing fewer licenses, attempting to renegotiate contracts to obtain concessions and requesting extended billing and payment terms.

Such an adverse effect on our financial condition and operating results would not be fully reflected in our results of operations until future periods.

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If we are unable to maintain or replace our contractual relationships with our existing reseller customers, efficiently manage our relationships with them or establish new contractual relationships with other third parties, we may fail to retain customers or acquire potential new customers and may experience delays and increased costs in adding or replacing customers that were lost, any of which could materially adversely affect our business, operating results and financial condition.

We previously identified and continue to identify material weaknesses in our internal control over financial reporting.

We may fail to remediate the identified material weakness, identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal control over financial reporting, and as a result, investor confidence in us and the value of our common stock could be materially and adversely affected.

We previously identified material weaknesses in our internal control over financial reporting.

We may identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal control over financial reporting, and as a result, investor confidence in us and the value of our common stock could be materially and adversely affected.

As a public company, we are required to establish and maintain internal control over financial reporting.

Section 404 of the Sarbanes-Oxley Act of 2002, or Section 404, requires that we evaluate and determine the effectiveness of our internal control over financial reporting and provide a management report on internal control over financial reporting.

Under standards established by the

United States Public Company Accounting Oversight Board, a material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of annual or interim financial statements will not be prevented or detected and corrected on a timely basis.

In connection with the audit of the fiscal year 2019 consolidated financial statements, we and our independent registered public accounting firm identified a material weakness in information technology general controls ("IT General Controls").

The deficiencies in IT General Controls also resulted in a conclusion that manual controls that rely on data produced by and maintained within these affected information technology systems and automated controls within these affected information technology systems across several of our significant classes of transactions were ineffective.

Based on the nature of these deficiencies in IT General Controls, we concluded that the two material weaknesses from fiscal years prior to 2019 related to the revenue recognition process and financial close continued to exist as of January 31, 2019.

As of January 31, 2020, we determined that these previously identified material weaknesses had been remediated.

Notwithstanding, as of January 31, 2020, we identified a material weakness in our internal control over financial reporting associated with processes to calculate, record and account for sales commissions.

While we took steps toward remediating this material weakness in fiscal year 2021, the material weakness related to the sales commission process continued to exist as of January 31, 2021.

We are taking steps to remediate this material weakness.

However, we cannot at this time estimate how long it will take to remediate the material weakness, and we may not ever be able to remediate the material weakness.

For additional information regarding this material weakness and related remediation activities, see Item 9A.

"Controls and Procedures." If we are unable to successfully remediate the material weakness and otherwise establish and maintain an effective system of internal control over financial reporting, the reliability of our financial reporting, investor confidence in us and the value of our common stock could be materially and adversely affected.

Under standards established by the United States Public Company Accounting Oversight Board, a material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of annual or interim financial statements will not be prevented or detected and corrected on a timely basis.

As of January 31, 2021, we had identified a material weakness in our internal control over financial reporting associated with processes to calculate, record and account for sales commissions.

In fiscal year 2022, we remediated the identified deficiencies in internal control over financial reporting – see Item 9A.

“Controls and Procedures”.

Based on the results of our evaluation, we concluded that as of January 31, 2022 we have maintained effective internal control over financial reporting.

If we are unable to maintain an effective system of internal control over financial reporting, the reliability of our financial reporting, investor confidence in us and the value of our common stock could be materially and adversely affected.

In addition, we may discover other control deficiencies in the future, and we cannot assure you that we will not have a material weakness in future periods.

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For example, as a result of the COVID-19 pandemic the operation of our business has been disrupted.

We have temporarily closed our offices requiring all of our employees globally to work remotely.

Our corporate headquarters is located in New York City, an area that was and continues to be significantly affected by the COVID-19 pandemic.

We have restricted non-essential business travel and canceled in-person marketing events, including our annual industry and customer event ONWARD.

Our offices have been open on a voluntary basis in accordance with guidance provided by government agencies, although currently the majority of our employees are still working remotely.While we continue to hold virtual events, we have also resumed in-person marketing events.

The duration of the business disruption and related financial impact cannot be reasonably estimated at this time.

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Our success depends largely upon the continued services of our key executive officers.

In particular, two of our co-founders, Howard Lerman and Brian Distelburger, who serve as our Chief Executive Officer and President, respectively, are critical to our vision, strategic direction, feature innovation, culture and overall business success.

We also rely on our leadership team in the areas of research and development, marketing, sales, services and general and administrative functions.

From time to time, there may be changes in our executive management team resulting from the hiring or departure of executives, which could disrupt our business.

For example during the fiscal year ended January 31, 2021, we announced changes to the leadership team for our sales and research and development functions, and the departure of these key executives may disrupt strategic initiatives of these functions.

For example in March 2022, we announced changes to our Chief Executive Officer, Chief Financial Officer and broader leadership team, and the change of key executives may disrupt strategic initiatives of these functions.

We do not have employment agreements with our executive officers or other key personnel that require them to continue to work for us for any specified period and, therefore, they could terminate their employment with us at any time.

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To execute our business strategy, we must attract and retain highly qualified personnel.

In particular, we compete with many other companies for software developers with high levels of experience in designing, developing and managing cloud-based software, as well as for skilled information technology, sales, marketing, legal and accounting professionals, and we may not be successful in attracting and retaining the professionals we need.

In the future, we may experience difficulty in hiring and difficulty in retaining highly skilled employees with appropriate qualifications.

In particular, we compete with many other companies for software developers with high levels of experience in designing, developing and managing cloud-based software and search software, as well as for skilled information technology, sales, marketing, legal and accounting professionals, and we may not be successful in attracting and retaining the professionals we need.

In the future, we may experience difficulty in hiring and retaining highly skilled employees with appropriate qualifications.

For example, we have experienced such difficulty during the COVID-19 pandemic particularly with respect to our quota-carrying sales representatives.

In addition, recent decreases in our stock price may also decrease retention.

We face intense competition for qualified individuals from numerous software and other technology companies.

Competition for qualified personnel is particularly intense in the New York area.

We may incur significant costs to attract and retain qualified personnel, and we may lose new employees to our competitors or other technology companies before we capitalize the benefit of our investment in recruiting and training them.

For example, we may not be successful in attracting and retaining software developers with search expertise, as our competitors have greater experience and name recognition in this area.

Competition for qualified personnel is particularly intense in metropolitan areas where we have offices including the New York area.

recruiting and training them.

We also employ a number of foreign nationals on work visas, primarily under the H-1B visa.

Current and future restrictions on the availability of visas or delays in the issuance of visas could impair our ability to employ skilled professionals, which could have an adverse effect on our business.

Current and future restrictions on the availability of visas or delays in the issuance of visas could impair our ability to employ skilled professionals.

If we are unable to hire and retain highly qualified personnel, our rate of growth and business will be adversely affected.

In addition, in making employment decisions, particularly in the software industry, job candidates often consider the value of the stock options or other equity incentives they are to receive in connection with their employment.

If the price of our stock declines, or experiences significant volatility, our ability to attract or retain key employees will be adversely affected.

Also, as employee options vest, we may have difficulty retaining key employees or may be required to grant larger equity awards from our equity plans, which would cause dilution.

If the price of our stock declines, does not appreciate or experiences significant volatility, our ability to attract or retain key employees will be adversely affected.

Also, as employee equity awards vest, we may have difficulty retaining key employees or may be required to grant larger equity awards from our equity plans, which would cause dilution.

If we fail to attract new personnel or fail to retain and motivate our current personnel, our growth prospects could be severely harmed.

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In general, worldwide economic conditions may remain unstable, and these conditions would make it difficult for our customers, prospective customers and us to forecast and plan future business activities accurately, and they could cause our customers or prospective customers to reevaluate their decision to purchase our features.

Weak global economic conditions, or a reduction in technology spending even if economic conditions stabilize, could adversely impact our business and results of operations in a number of ways, including longer sales cycles, lower prices for our platform, fewer subscriptions and lower or no growth.

Weak global economic conditions, changes in consumer behavior or a reduction in technology spending even if economic conditions stabilize, could adversely impact our business and results of operations in a number of ways, including longer sales cycles, lower demand or prices for our platform, fewer subscriptions and lower or no growth.

For example, the COVID-19 pandemic and resulting governmental restrictions and regulations have created additional uncertainty in the global economy and a sharp increase in unemployment.

The prolonged uncertainty and weak economic conditions relating to the COVID-19 pandemic has led certain of our customers and potential customers to decrease the rate of their information technology spending, has adversely affected their ability or willingness to purchase our platform and has caused them to delay purchasing decisions or reduce the value or duration of their subscriptions, all of which adversely affected our operating results.

The prolonged uncertainty and weak economic conditions relating to the COVID-19 pandemic have led certain of our customers and potential customers to decrease the rate of their information technology spending, has adversely affected their ability or willingness to purchase our platform and has caused them to delay purchasing decisions or reduce the value or duration of their subscriptions, all of which has adversely affected our operating results.

Further, Russia’s recent invasion of Ukraine may lead to disruption, instability, deterioration and volatility in global markets and industries that could negatively impact our business, financial condition and results of operations.

In addition, the economies of countries in Europe have been experiencing weakness associated with high sovereign debt levels, weakness in the banking sector and uncertainty over the future of the European Union, including uncertainty regarding Brexit.

We have operations, as well as current and potential new customers, throughout Europe.

The European Union's economy also suffered a sharp downturn due to the COVID-19 pandemic, and economic conditions in Europe and other key markets for our platform remain weak.

The European Union's economy also suffered a sharp downturn due to the COVID-19 pandemic and Russia's invasion of Ukraine, and economic conditions in Europe and other key markets for our platform remain weak.

As a result, we have experienced negative impacts on our sales activities in Europe.

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In addition, the legal, regulatory and economic impacts of the United Kingdom’s exit from the European Union in January 2020 are not fully known at this time.

While the United Kingdom and the European Union have signed a EU-UK Trade and Cooperation Agreement, there are still many uncertainties and regulations applicable during the transition period will likely be amended and may diverge from European Union regulations.

While the United Kingdom and the European Union have signed an EU-UK Trade and Cooperation Agreement, there are still many uncertainties and regulations applicable during the transition period will likely be amended and may diverge from European Union

The outcome of these events may, among other things, increase the costs and complexity of our operations in Europe including our ability to hire and retain employees.

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Our management team has limited experience managing a public company.

Our chief executive officer has limited experience managing a public company, interacting with public company investors and complying with the increasingly complex laws pertaining to public companies.

While our chief financial officer and certain other executives have such experience, our management team, as a whole, may not successfully or efficiently manage the ongoing transition to being a public company subject to significant regulatory oversight and reporting obligations under the federal securities laws and the continuous scrutiny of securities analysts and investors.

These new obligations and constituents will require significant attention from our senior management, particularly from our chief executive officer, and could divert their attention away from the day-to-day management of our business, which could adversely affect our business, operating results and financial condition.

Our chief executive officer and chief financial officer have limited experience managing a public company, interacting with public company investors and complying with the increasingly complex laws pertaining to public companies.

While certain other executives have such experience, our management team, as a whole, may not successfully or efficiently manage the ongoing transition to being a public company subject to significant regulatory oversight and reporting obligations under the federal securities laws and the continuous scrutiny of securities analysts and investors.

These new obligations and constituents will require significant attention from our senior management, particularly from our chief executive officer and chief financial officer, and could divert their attention away from the day-to-day management of our business, which could adversely affect our business, operating results and financial condition.

We are exposed to fluctuations in currency exchange rates.

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Additionally, as we anticipate growing our business further outside of the United States, the effects of movements in currency exchange rates will increase as our transaction volume outside of the United States increases.

Our new credit facility contains restrictive covenants that may limit our operating flexibility.

On March 11, 2020, we replaced our existing revolving credit facility by entering into a new credit facility.

Our new credit facility contains restrictive covenants that limit our ability to transfer or dispose of assets, merge with other companies or consummate certain changes of control, acquire other companies, pay dividends, incur additional indebtedness and liens and enter into new businesses.

We therefore may not be able to engage in any of the foregoing transactions unless we obtain the consent of the lender or terminate the new credit facility, which may limit our operating flexibility.

In addition, our new credit facility is secured by all of our assets and requires us to satisfy certain financial covenants.

Our credit facility contains restrictive covenants that may limit our operating flexibility.

Our credit facility contains restrictive covenants that may limit our ability to transfer or dispose of assets, merge with other companies or consummate certain changes of control, acquire other companies, pay dividends or repurchase Yext stock, incur additional indebtedness and liens and enter into new businesses.

We therefore may not be able to engage in any of the foregoing transactions unless we obtain the consent of the lender or terminate the credit facility, which may limit our operating flexibility.

In addition, our credit facility is secured by all of our assets and requires us to satisfy certain financial covenants.

There is no guarantee that we will be able to generate sufficient cash flow or sales to meet these financial covenants or pay the principal and interest on any such debt.

Furthermore, there is no guarantee that future working capital, borrowings or equity financing will be available to repay or refinance any such debt.

Any inability to make scheduled payments or meet the financial covenants on our new credit facility would adversely affect our business.

Loans under our new credit facility bear interest, at our option, at an annual rate based on LIBOR (or any such successor benchmark rate) or a base rate.

It is unclear whether LIBOR will continue to exist after 2021 and it is not possible to predict the effect

of any changes to LIBOR, any phase out of LIBOR or any establishment of any successor benchmark rates on our new credit facility or our business generally.

As a result, our interest costs could increase and our access to capital could change, which could adversely affect our results of operations and cash flows.

Any inability to make scheduled payments or meet the financial covenants on our credit facility would adversely affect our business.

Loans under our credit facility bear interest, at our option, at an annual rate based on LIBOR (or a successor benchmark rate) or a base rate.

LIBOR is expected to be replaced as an index rate in financial transactions by an alternative benchmark rate in the near future.

While our credit agreement provides for a methodology to effect a transition from LIBOR to a new benchmark rate, it is not possible to predict the effect or timing of any establishment of a successor benchmark rate or its effect on our credit facility or our business generally.

The transition from LIBOR could result in our interest costs increasing and our access to capital could change, which could adversely affect our results of operations and cash flows.

We may require additional capital to support our business, and this capital might not be available on acceptable terms, if at all.

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A security breach, network attack or information security incident could delay or interrupt service to our customers, result in the unauthorized access to, or use, modification or publishing of customer content or other information, harm our reputation or subject us to significant liability.

We are vulnerable to computer viruses, break-ins, phishing attacks, attempts to overload our servers with denial-of-service or other attacks and similar disruptions from unauthorized use of our computer systems.

We are vulnerable to computer viruses, break-ins, phishing attacks, ransomware, supply chain attacks, attempts to overload our servers with denial-of-service or other attacks and similar disruptions from unauthorized use of our computer systems.

Any such attack, or any information security incident from any other source affecting us or our services providers, including through employee error or misconduct or additional vulnerabilities introduced by remote work arrangements, could lead to interruptions, delays, website or application shutdowns, loss of data or unauthorized access to, or use or acquisition of, personal information, confidential information or other data that we or our services providers process or maintain.

For example, in December 2015, we suffered a denial-of-service attack, which resulted in the inability for some of our customers to access our platform for several hours.

If we experience additional compromises to our security that result in performance or availability problems, the complete shutdown of our platform or the loss of, or unauthorized access to, personal information or other types of confidential information, our customers or application providers may assert claims against us for credits, refunds or other damages, and may lose trust and confidence in our platform.

Additionally, security breaches or other unauthorized access to, or use or acquisition of, personal information or other types of confidential information that we or our services providers maintain, could result in claims against us for identity theft or other similar fraud claims, breach of contract or indemnity, governmental enforcement actions, litigation, fines and penalties or adverse publicity, and could cause our customers and partners to lose trust in us, any of which could have an adverse effect on our business, reputation, operating results and financial condition.

If we experience additional compromises to our security that result in performance or availability problems, the complete shutdown of our platform or the actual or perceived loss of, or unauthorized access to, unavailability of, or unauthorized use, disclosure, destruction, or other unauthorized processing of, personal information or other types of confidential information, our customers or application providers may assert claims against us for credits, refunds or other damages, and may lose trust and confidence in our platform.

Additionally, security breaches and incidents or other unauthorized access to, unavailability of, or unauthorized use, disclosure, destruction, acquisition, or other processing of, personal information or other types of confidential information that we or our services providers maintain, or the perception that any of these have occurred, could result in claims against us for identity theft or other similar fraud claims, breach of contract or indemnity, governmental enforcement actions, litigation, fines and penalties or adverse publicity, or other claims and litigation, and could cause our customers and partners to lose trust in us, any of which could have an adverse effect on our business, reputation, operating results and financial condition.

Our existing insurance coverage may not continue to be available on acceptable terms or may not be available in sufficient amounts to cover one or more large claims related to a security breach.

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We could also be required to incur significant costs for remediation or expend significant capital and other resources to address a security breach.

The techniques used to obtain unauthorized access, disable or degrade service or sabotage systems change frequently, often are not recognized until launched against a target and may originate from less regulated countries, we may be unable to proactively address these techniques or to implement adequate preventative measures.

The techniques used to obtain unauthorized access, disable or degrade service or sabotage systems change frequently, often are not recognized until launched against a target and

may originate from less regulated countries, we may be unable to proactively address these techniques or to implement adequate preventative measures.

In addition, customers' and application providers' accounts and listing pages hosted on our platform could be accessed by unauthorized persons for the purpose of placing illegal, abusive or otherwise unauthorized content on their respective websites and applications.

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These agreements may not effectively prevent disclosure of our confidential information, and it may be possible for unauthorized parties to copy our software or other proprietary technology or information, or to develop similar software independently without our having an adequate remedy for unauthorized use or disclosure of our confidential information.

In addition, others may independently discover our trade secrets and proprietary information, and in these cases, we would not be able to assert any trade secret rights against those parties.

In addition, others may independently discover our trade secrets and proprietary information, and in

these cases, we would not be able to assert any trade secret rights against those parties.

Costly and time-consuming litigation could be necessary to enforce and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret protection could adversely affect our competitive business position.

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Proceedings to enforce our patent rights in foreign jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business.

Accordingly, our efforts to protect our intellectual property rights in such countries may be

Accordingly, our efforts to protect our intellectual property rights in such countries may be inadequate.

In addition, changes in the law and legal decisions by courts in the United States and foreign countries may affect our ability to obtain adequate protection for our technology and the enforcement of intellectual property.

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If these data centers or cloud computing services become unavailable to us without sufficient advance notice, if we are unable to renew our agreements with these providers or if a provider is acquired or ceases business, we would likely experience delays in delivering our platform until we could migrate to an alternate provider.

Our disaster recovery program contemplates transitioning our platform to our backup center in the event of a catastrophe and our platform may be unavailable, in whole or in part, during any transition procedure.

Our disaster recovery program contemplates

transitioning our platform to our backup center in the event of a catastrophe and our platform may be unavailable, in whole or in part, during any transition procedure.

We have experienced, and will in the future experience, interruptions, outages and other performance problems.

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Compliance with such laws could also impair our efforts to maintain and expand our customer base, and thereby decrease our revenue.

We receive, store and process personal information and other data from and about customers, including third-party reseller customers, partners and, in limited instances, end users of our services, in addition to our employees and services providers.

Also, in connection with future feature offerings, we may receive, store and process additional types of data, including personally identifiable information, related to end consumers.

We receive, store and process personal data and other data from and about customers, including third-party reseller customers, partners, end users of our services, and in limited cases, end consumers in addition to our employees and services providers.

Also, in connection with future feature offerings, we may receive, store and process additional types of data, including personal data.

Our handling of data is subject to a variety of laws and regulations, including regulation by various government agencies, such as the U.S.

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The CCPA requires covered businesses to, among other things, make new disclosures to consumers about their data collection, use, and sharing practices, and allows consumers to opt out of certain data sharing with third parties.

The CCPA also provides a new private cause of action for certain data breaches.

also provides a new private cause of action for certain data breaches.

The California Privacy Rights Act, or CPRA, which will become effective on January 1, 2023, will significantly modify the CCPA, and also create a new state agency that will be vested with authority to implement and enforce the CCPA and the CPRA.

The effects of the CCPA and the CPRA are potentially significant and may require us to incur substantial costs and expenses in an effort to comply and increase our potential exposure to regulatory enforcement and/or litigation.

States such as Virginia and Colorado have enacted and we expect additional states may also enact legislation similar to the CCPA and CRPA.

Additionally, the FTC and many state attorneys general are interpreting federal and state consumer protection laws as imposing standards for the online collection, use, dissemination and security of data.

Similarly, several foreign countries and governmental bodies, including the European Union, have laws and regulations dealing with the handling and processing of personal information obtained from their residents, which in certain cases are more restrictive than those in the United States.

Several foreign countries and governmental bodies, including the European Union, Switzerland and the United Kingdom have laws and regulations dealing with the handling and processing of personal information obtained from their residents, which in certain cases are more restrictive than those in the United States, and we expect additional jurisdictions may enact similar regulations.

Laws and regulations in these jurisdictions apply broadly to the collection, use, storage, disclosure and security of various types of data, including data that identifies or may be used to identify an individual, such as names, email addresses and in some jurisdictions, Internet Protocol, or IP, addresses.

Within the European Union, legislators have adopted the General Data Protection Regulation, or GDPR, which became effective in May 2018.

The GDPR includes more stringent operational requirements for processors and controllers of personal data than previous EU data protection laws and imposes significant penalties for non-

The United Kingdom has implemented a Data Protection Act that substantially implements the GDPR.

However, the United Kingdom’s decision to exit the European Union, known as Brexit, has created uncertainty regarding the regulation of data protection in the United Kingdom in the medium to long term, which may delay or deter transactions with customers that transfer data to and from the United Kingdom.

The GDPR includes more stringent operational requirements for processors and controllers of personal data than previous EU data protection laws and imposes significant penalties for non-compliance.

The United Kingdom has implemented data protection laws that substantially implements the GDPR and provide for similar penalties.

We participate in and have certified under the EU-U.S.

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Privacy Shield frameworks with respect to our transfer of certain personal data from the European Union and Switzerland to the United States.

In July 2020, the European Court of Justice invalidated the EU-U.S.

Privacy Shield framework, but concluded that the Standard Contractual Clauses issued by the European Commission for the transfer of personal data are valid.

In July 2020, the Court of Justice of the European Union invalidated the EU-U.S.

Privacy Shield framework, but concluded that the Standard Contractual Clauses issued by the European Commission for the transfer of personal data, or SCCs, are valid, subject to companies being required to engage in additional measures when relying on the SCCs.

The Swiss-U.S.

Privacy Shield subsequently was invalidated in September 2020 by the Swiss Federal Data Protection and Information Commissioner.

On June 4, 2021, the European Commission published new SCCs that are required to be implemented, and on February 2, 2022, the United Kingdom’s Information Commissioner’s Office issued new standard contractual clauses to support personal data transfers out of the United Kingdom, or UK SCCs”.

If approved by the United Kingdom Parliament, the UK SCCs will become effective March 21, 2022, and we may, in addition to other impacts, experience additional costs associated with increased compliance burdens and be required to engage in new contract negotiations with third parties that aid in processing personal data on our behalf or localize certain personal data.

The invalidation of the EU-U.S.

Privacy Shield and related uncertainty regarding other data transfer mechanisms could have a significant adverse impact on our ability to process and transfer personal data outside of the European Union, while increasing our compliance costs and legal and regulatory risks.

Customers and potential customers may view alternative data transfer mechanisms as being too costly, burdensome or uncertain and therefore impairing our ability to attract and retain customers.

In addition, other mechanisms that we use or may use in the future in an effort to legitimize cross-border data transfers may be challenged or invalidated or may evolve such that they do not function as appropriate means for us to transfer certain personal data from the European Union and Switzerland to the United States.

and Swiss-U.S.

Privacy Shield frameworks and related developments and uncertainty regarding other data transfer mechanisms could require us to implement additional contractual and technical safeguards for any personal data transferred out of the European Economic Area, or EEA, Switzerland, and the United Kingdom, which may increase compliance and related costs and risks, lead to increased regulatory scrutiny or liability, necessitate additional contractual negotiations, and adversely impact our business, operating results and financial condition.

Customers and potential customers may hesitate or refuse to purchase and use our products and services due to the potential risk posed by the Court of Justice of the European Union ruling or may view alternative data transfer mechanisms as being too costly, burdensome or uncertain.

Our ability to attract and retain customers may therefore be impaired.

These domestic and foreign laws and regulations relating to privacy and data security are evolving, can be subject to significant change and may result in ever-increasing regulatory and public scrutiny and escalating levels of enforcement and sanctions.

Interpretation of certain requirements remains unclear and may evolve, in particular for regulations that have recently been enacted.

Application of laws may be inconsistent or may conflict among jurisdictions.

Application of laws may be inconsistent or may conflict among jurisdictions resulting in additional complexity and increased legal risk.

In addition, these regulations have increased our compliance costs and may impair our ability to grow our business or offer our service in some locations, may subject us to liability for non-compliance, may require us to modify our data processing and transferring practices and policies and may strain our technical capabilities.

In addition as we, our customers and potential customers evaluate the impact of new regulations such as GDPR and as additional requirements pursuant to such regulations are adopted, sales cycles have lengthened and transaction costs have increased as customers conduct additional diligence and contractual obligations under the new regulations are negotiated.

We also handle credit card and other personal information.

We also handle credit card and other personal data.

Due to the sensitive nature of such information, we have implemented policies and procedures in an effort to preserve and protect our data and our customers' data against loss, misuse, corruption, misappropriation caused by systems failures, unauthorized access or misuse.

Notwithstanding these policies, we could be subject to liability claims by individuals and customers whose data resides in our databases for the misuse of that information.

Notwithstanding these policies, we could be subject to liability claims by individuals and customers whose data resides in our databases for the misuse of that information, and we are required to comply with applicable industry standards with respect to our handling of this information.

If we fail to meet appropriate compliance levels, this could negatively impact our ability to utilize credit cards as a method of payment, and/or collect and store credit card information, which could disrupt our business.

We may be subject to rules of the FTC, the Federal Communications Commission, or FCC, and potentially other federal agencies and state laws related to commercial electronic mail and other messages.

Compliance with these provisions may limit our ability to send certain types of messages.

We may be subject to rules of the FTC, the Federal Communications Commission, or FCC, and potentially other federal agencies, state laws as well as international regulations related to commercial electronic mail and other messages.

Compliance with these

provisions may limit our ability to send certain types of messages.

If we were found to have violated such rules and regulations, we may face enforcement actions by the FTC or FCC or face civil penalties, either of which could adversely affect our business.

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Future laws, regulations, standards and other obligations or any changed interpretation of existing laws or regulations could impair our ability to develop and market new features and maintain and grow our customer base and increase revenue.

Future restrictions on the collection, use, sharing or disclosure of data or additional requirements placed upon us, our customers, partners or end consumers in connection with the use and disclosure of such information could require us to incur additional costs or modify our platform or other aspects of our products and services, possibly in a material manner, and

could increase the complexity and cost of developing and deploying new products or limit our ability to develop new products and features altogether.

If our policies, procedures, or measures relating to privacy, data protection, marketing, or customer communications fail or are perceived to fail to comply with laws, regulations, policies, legal obligations or industry standards, we may be subject to governmental enforcement actions, litigation, regulatory investigations, fines, penalties and negative publicity and could cause our application providers, customers and partners to lose trust in us, which could materially affect our business, operating results and financial condition.

If our policies, procedures, or measures relating to privacy, data protection, marketing, or customer communications fail or are perceived to fail to comply with laws, regulations, policies, legal obligations or industry standards, we may be subject to governmental enforcement actions, litigation, regulatory investigations, fines, penalties, consumer actions and negative publicity and could cause our application providers, customers and partners to lose trust in us, which could materially affect our business, operating results and financial condition.

Furthermore, our third-party reseller customers, over which we have more limited control, may not comply with the laws, regulations and policies described above, which may damage our reputation or subject us to costly legal or regulatory inquiries and liability.

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While we have policies and procedures in this area, we cannot guarantee that improprieties committed by our employees or third parties will not occur.

Noncompliance with these laws could subject us to investigations, sanctions, settlements, prosecution, other enforcement actions, disgorgement of profits, significant fines, damages, other civil and criminal penalties or injunctions, suspension or debarment from contracting with certain persons, the loss of export privileges, whistleblower complaints, reputational harm, adverse media coverage, and other collateral consequences.

Non-compliance with these laws could subject us to investigations, sanctions, settlements, prosecution, other enforcement actions, disgorgement of profits, significant fines, damages, other civil and criminal penalties or injunctions, suspension or debarment from contracting with certain persons, the loss of export privileges, whistleblower complaints, reputational harm, adverse media coverage, and other collateral consequences.

If any subpoenas or investigations are launched, or governmental or other sanctions are imposed, or if we do not prevail in any possible civil or criminal litigation, our business, results of operations and financial condition could be materially harmed.

In addition, responding to any action will likely result in a materially significant diversion of management's attention and resources and significant defense and compliance costs and other professional fees and may harm our reputation, which may damage our relationships with our customers, strategic partners and other third parties.

In certain cases, enforcement authorities may even require us to appoint an independent compliance monitor, which can result in added costs and administrative burdens.

In certain cases, enforcement authorities may even require us to appoint an independent compliance monitor, which

can result in added costs and administrative burdens.

Any investigations, actions or sanctions or other previously mentioned harm could have a material negative effect on our business, operating results and financial condition.

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Any change in export or import regulations, shift in the enforcement or scope of existing regulations, or change in the countries, governments, persons or technologies targeted by such regulations, could also result in decreased use of our products or in our decreased ability to export or sell our products to existing or potential customers with international operations.

For example, in February 2022, following Russia’s invasion of Ukraine, the United States and other countries announced economic sanctions against Russia, and the United States and other countries could impose wider sanctions and take other actions as the conflict further escalate.

Any decreased use of our products or limitation on our ability to export or sell our products would likely adversely affect our business.

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We generally conduct our international operations through wholly-owned subsidiaries and report our taxable income based upon our business operations in those jurisdictions.

The amount of taxes we pay may depend on the application of the tax laws of various jurisdictions, including the United States, to our business activities, changes in tax rates, new or revised tax laws or interpretations of existing tax laws and policies and our ability to operate our business in a manner consistent with our corporate structure and intercompany arrangements.

Our tax liabilities may be impacted if our intercompany transactions, which are required to be computed on an arm's-length basis, are challenged and successfully disputed by the tax authorities.

interpretations of existing tax laws and policies and our ability to operate our business in a manner consistent with our corporate structure and intercompany arrangements.

In determining the adequacy of income taxes, we assess the likelihood of adverse outcomes that could result if our tax positions were challenged by the Internal Revenue Service, or IRS, and other tax authorities.

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• the timing and success of new feature introductions by us or our competitors or any other change in the competitive dynamics of our industry, including consolidation among competitors, customers or application providers;

• our ability to adequately scale our sales force and retain key employees;

• the timing of expenses related to the development or acquisition of technologies or businesses and potential future charges for impairment of goodwill from acquired companies;

• unforeseen litigation.

If securities or industry analysts do not publish research or reports about us, our business or our market, or if they cease publishing research or change their recommendations regarding our stock adversely, or if our actual results differ significantly from our guidance or analysts' expectations, our stock price and trading volume could decline.

If securities or industry analysts do not continue to publish research or reports about us, our business or our market, or if they cease publishing research or change their recommendations regarding our stock adversely, or if our actual results differ significantly from our guidance or analysts' expectations, our stock price and trading volume could decline.

The trading market for our common stock depends in part on the research and reports that securities or industry analysts publish about us or our business.

If few analysts commence coverage of us, cease coverage of us or fail to publish reports on us regularly, demand for our common stock could decrease, which might cause our common stock price and trading volume to decline.

if one or more of the analysts who cover us downgrade our common stock or publish inaccurate or unfavorable research about our business, the price of our common stock would likely decline.

If analysts cease coverage of us or fail to publish reports on us regularly, demand for our common stock could decrease, which might cause our common stock price and trading volume to decline.

In addition, if one or more of the analysts who cover us downgrade our common stock or publish inaccurate or unfavorable research about our business, the price of our common stock would likely decline.

In addition, from time to time, we may release earnings guidance or other forward-looking statements in our earnings releases, earnings conference calls or otherwise regarding our future performance that represent our management's estimates as of the date of release.

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Our certificate of incorporation authorizes us to issue up to 500,000,000 shares of common stock and up to 50,000,000 shares of preferred stock.

Future sales and issuances of our capital stock or rights to purchase our capital

stock could result in substantial dilution to our existing stockholders.

Future sales and issuances of our capital stock or rights to purchase our capital stock could result in substantial dilution to our existing stockholders.

We may sell common stock, convertible securities and other equity securities in one or more transactions at prices and in a manner as we may determine from time to time.

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We currently intend to retain any future earnings to finance the operation and expansion of our business, and we do not expect to declare or pay any dividends in the foreseeable future.

In addition, our ability to pay dividends may be limited by our credit agreement.

Consequently, stockholders must rely on sales of their common stock after price appreciation as the only way to realize any future gains on their investment.

Share repurchases could affect our stock price and increase its volatility and will diminish our cash reserves.

Repurchases pursuant to any share repurchase program we adopt in the future could affect our stock price and increase its volatility and will reduce the market liquidity for our stock.

These activities may have the effect of maintaining the market price of our common stock or slow down a decline in the market price of the common stock, and, as a result, the price of our common stock may be higher than the price that otherwise might exist in the open market.

Additionally, these repurchases will diminish our cash reserves, which could impact our ability to pursue possible future strategic opportunities and acquisitions and result in lower overall returns on our cash balances.

Delaware law and provisions in our amended and restated certificate of incorporation and amended and restated bylaws could make a merger, tender offer or proxy contest difficult, thereby depressing the trading price of our common stock.

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The existence of these provisions could negatively affect the price of our common stock and limit opportunities for you to realize value in a corporate transaction.

We have incurred and expect to continue to incur significantly increased costs and substantial demands on management time to operate as a public company.

As a public company, we have incurred and expect to continue to incur significant legal, accounting and other expenses that we did not incur as a private company.

For example, we are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, and are required to comply with the applicable requirements of the Sarbanes-Oxley Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act, as well as rules and regulations subsequently implemented by the SEC and the New York Stock Exchange, including the establishment and maintenance of effective disclosure and financial controls and changes in corporate governance practices.

Furthermore, on January 31, 2019, we no longer qualified as an emerging growth company, and became subject to additional reporting requirements and standards and accelerated filing deadlines for our periodic reports.

For example, we have incurred and continue to incur significant expenses and devoted substantial management effort toward ensuring compliance with the requirements of Section 404 of the Sarbanes-Oxley Act.

In addition on January 31, 2019, we were required to adopt certain accounting standards including ASU No.

2014-09, Revenue from Contracts with Customers (Topic 606), when certain extended transition periods available to emerging growth companies expired.

We also became subject to enhanced disclosures obligations regarding executive compensation in our periodic reports and proxy statements and requirements to hold a nonbinding advisory vote on executive compensation.

Compliance with these requirements has increased our legal and financial compliance costs and has made some activities more time consuming and costly.

In addition, our management and other personnel devote substantial time to our public company requirements, which diverts attention from operational and other business matters.

We have and will continue to hire additional accounting and financial staff with appropriate public company experience and technical accounting knowledge and maintain an internal audit function.

We cannot predict or estimate the amount of additional costs we may incur as a result of operating as a public company or the timing of such costs.

Unresolved Staff Comments

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

What changed 10-K

Item 1A. Risk Factors