SEMrush Holdings Inc.  SEMR  $14.00-$16.00 16.8 million shares Underwriters: Goldman Sachs, JP Morgan, Jefferies, KeyBanc Capital   Co-Managers: Piper Sandler, Stifel Proposed trade date of 3/25  They are a leading online visibility management software-as-a-service platform.

SEMrush Holdings Inc.  SEMR

• 16,800,000 shares to be offered between $14.00 and $16.00 per share
• Underwriters: Goldman Sachs, JP Morgan, Jefferies, KeyBanc Capital Co-Managers: Piper Sandler, Stifel
• Proposed trade date of 3/25
• Rating = 3

Click here to view the prospectus.

https://www.sec.gov/Archives/edgar/data/1831840/000162828021004792/semrushforms-1a1.htm

Company Overview

They are a leading online visibility management software-as-a-service platform. They enable companies globally to identify and reach the right audience for their content, in the right context, and through the right channels. Online visibility represents how effectively companies connect with consumers across a variety of digital channels, including search, social and digital media, digital public relations, and review websites. The evolving online landscape and information overload from online content have made it increasingly difficult for companies to understand and manage their online visibility. Their proprietary software-as-a-service (“SaaS”) platform enables them to aggregate and enrich trillions of data points collected from over 200 million unique domains. Their platform enables their customers to understand trends and act upon unique insights to improve their online visibility, drive high-quality traffic to their websites and social media pages, as well as online listings, distribute highly targeted content to their customers, and measure the effectiveness of their digital marketing campaigns. As of December 31, 2019 and 2020, their differentiated platform empowered over 334,000 and 404,000 active free customers, respectively, and over 54,000 and 67,000 paying customers, respectively, in over 135 and 142 countries, respectively.

As interactions between companies and their customers continue to shift online, managing a company’s online visibility has become critical. With over 4.9 billion internet users in the third quarter of 2020, according to Internet World Stats, and consumers worldwide spending an average of over six and a half hours per day online, according to GlobalWebIndex, digital channels are essential for customer engagement. While these digital channels have made it easier for companies to have an online presence, with so many different sources of media competing for customers’ attention, it has become increasingly difficult for companies to be discovered by, and engage with, their customers. Most companies do not have the technology or resources to effectively ingest, aggregate, process, and analyze the vast amount of fragmented data from these diverse sources at scale to derive actionable insights. Companies often attempt to address individual aspects of online visibility, such as search engine optimization (“SEO”), search engine marketing (“SEM”), content marketing, social media management (“SMM”), digital public relations (“PR”), and competitive intelligence, among others. Fully integrated solutions are more likely to drive long-term traffic improvement than siloed approaches, offering more comprehensive functionality and insights, and combining strategies across owned, earned, and paid media.

Their fully integrated SaaS platform leverages their proprietary technology, differentiated data, and actionable insights to improve online visibility. They utilize machine learning capabilities to synthesize broad and deep data sets to derive actionable insights and analytics. Their ability to aggregate, crawl, and process massive data sets, including search engine, website traffic, backlink, online advertising, panel, and social media data, combined with their ability to obtain data from their customers through APIs, enables their software to generate a comprehensive view of a company’s online visibility profile and identify the specific keywords, advertisements, third-party websites, and content that are driving traffic. They also integrate with third-party solutions to create comprehensive end-to-end workflows across the entire marketing funnel. These workflows include analyzing trends, identifying potential opportunities to optimize visibility, creating high-quality content efficiently, helping customers assess different marketing approaches, executing campaigns regularly, and measuring the effectiveness of their marketing campaigns. As a result, they empower companies to improve their online visibility across key channels through a holistic strategy.

In a highly fragmented market with a myriad of network- and channel-specific solutions, their differentiated and integrated platform provides comprehensive insights into a company’s online visibility. Some large technology platforms including Google and Facebook offer their own solutions but are incentivized to prioritize their own paid channels, lack independence, and do not operate across rival networks. Meanwhile, individual solutions targeted at addressing one or a subset of business problems, or point solutions, rely on limited, channel-specific data, providing only partial, incomplete perspectives. Their technology collects, aggregates, and enriches a broad set of fragmented data across networks and channels, which they leverage to derive valuable and actionable insights that they provide their customers. As their data assets grow, their ability to provide insights improves, attracting more customers to their platform and enabling them to invest in new and existing products, thereby further strengthening their competitive position. According to G2.com, Inc. (“G2”), their platform is listed as a leader in the “all segments” category, comprised of reviewers from each of the small-business, mid-market and enterprise segments (as G2 defines such categories), across 15 product categories, including SEO, competitive intelligence, local marketing, content analytics, and social media analytics, which reinforces the strategic advantages of providing a comprehensive solution. G2 ranks different products and vendors based on reviews gathered from its user community (subject to certain minimum requirements concerning sample size and reviewer composition), as well as data aggregated from online sources and social networks, to which it applies its proprietary algorithm to calculate satisfaction and market presence scores ranging from 0 to 100 from which the products are ranked.

They offer their solutions on a multi-price point, recurring subscription basis, which provides incremental levels of access to their over 50 products, tools, and add-ons across online visibility management. Some customers start using their products, tools, and add-ons on a free basis before purchasing a subscription to receive premium functionality and additional user licenses. Their compelling value proposition, effective go-to-market strategy, and recurring revenue model drives efficient unit economics. These attributes have enabled them to cost-effectively acquire over 67,000 paying customers as of December 31, 2020, spanning a broad range of industries and geographies.

They utilize a highly efficient, low-touch sales approach focused on driving customers to their platform through a self-service model, allowing their sales team to focus on retention and account expansion. Their multi-price point structure also drives meaningful upsell opportunities through higher usage limits, greater product functionality, additional user licenses, and product add-ons, as reflected by their dollar-based net revenue retention rate of 120% and 114% during the years ended December 31, 2019 and 2020, respectively, and their compounded average annual revenue growth rate of over 50% between the years ended December 31, 2016 and December 31, 2020. They have introduced several new add-on offerings, which have enabled them to grow their annual recurring revenue (“ARR”) per paying customer from $1,892 as of December 31, 2019 to $2,123 as of December 31, 2020. They define ARR as the daily revenue of all paid subscription agreements that are actively generating revenue as of the last day of the reporting period multiplied by 365. They include both monthly recurring paid subscriptions, which renew automatically unless cancelled, as well as the annual recurring paid subscriptions so long as they do not have any indication that a customer has cancelled or intends to cancel its subscription and they continue to generate revenue from them.

IPO Detail

This is the initial public offering of SEMrush Holdings Inc. and no public market currently exists for its common stock. SEMrush Holdings Inc. is offering 16,800,000 shares of common stock as described in the prospectus. The company expects the initial public offering price of its common stock to be between $14.00 and $16.00 per share. The company has applied to list its common stock on the New York Stock Exchange under the symbol “SEMR.”

They have two classes of common stock, Class A common stock and Class B common stock. The rights of the holders of Class A common stock and Class B common stock are identical, except for voting and conversion rights. Each share of Class A common stock is entitled to one vote. Each share of Class B common stock is entitled to ten votes and is convertible at any time into one share of Class A common stock. The holders of their outstanding Class B common stock will hold approximately 98% of the voting power of their outstanding capital stock upon completion of this offering, with their directors, executive officers, and their affiliates holding approximately 92%.

Use of Proceeds

They estimate that the net proceeds from the sale of shares of their Class A common stock that they are selling in this offering will be approximately $205.1 million (or approximately $240.2 million if the underwriters’ option to purchase additional shares in this offering is exercised in full). They will not receive any proceeds from the sale of shares of their Class A common stock by the selling stockholders, although they will bear the costs, other than the underwriting discounts and commissions, associated with the sale of these shares.

The principal purposes of this offering are to increase their capitalization and financial flexibility, create a public market for their Class A common stock and facilitate their future access to the public equity markets. They anticipate that they will primarily use the net proceeds they receive from this offering, including any net proceeds they receive from the exercise of the underwriters’ over-allotment option to acquire additional shares of Class A common stock, to invest further in their sales and marketing activities to grow their customer base, to fund their research and development efforts to enhance their technology platform and product functionality, and to pay anticipated general and administrative expenses. They also intend to use proceeds from this offering to fund their other growth strategies described elsewhere in this prospectus. They may use a portion of the net proceeds for the acquisition of companies, technologies or other assets that they believe are complementary to their own, although they currently have no agreements, commitments or understandings with respect to any such transaction.

Competition

Market Opportunity

They estimate that, based on their current average customer spending levels, the annual global potential market opportunity for their online visibility management SaaS platform is currently $13 billion. They calculated this estimate based on the number of small and medium sized companies (those with less than 500 employees) and large companies (those with 500 or more employees) in the United States, based on information published by the U.S. Census Bureau. Approximately 94.9% of their customers are in the small and medium sized category and in such category their customers had an ARR per paying customer of $2,000 as of December 31, 2020, and their large enterprise customers had an ARR per paying customer of $4,200 as of December 31, 2020. With approximately 54% of their revenue coming from customers outside of the United States in 2020, they believe the opportunity internationally is at least as large as in the United States. They then multiplied the total number of companies in each segment by the average revenue per customer for each segment. They calculate the average revenue per customer for each segment using internal data based on actual customer spend. They assume 50% online penetration in the small company segment (those with less than 20 employees) and 100% penetration in the medium sized (those with between 20 and 499 employees) and large company segments. They believe that a 50% online penetration estimate for the small company segment is conservative as small companies are continuing to shift their operations online, particularly in response to the COVID-19 pandemic. As such, at 100% penetration, they estimate that their global annual potential market opportunity is over $20 billion, with $150 million of such annual global potential market opportunity attributable to large enterprise customers.

Target Markets

Acquire new paying customers. They expect to continue to target new customers who have not yet adopted online visibility management solutions and those who are currently using their free offering. Their sales model for new customers is highly efficient due to their low-friction, self-service onboarding capabilities that allow them to acquire new customers with relatively low sales investment. Additionally, they focus on the conversion of free customers to paying customers.

Expand the use of their platform by their existing paying customer base. Their substantial base of over 67,000 paying customers as of December 31, 2020, presents a significant opportunity to increase monetization. They expect to continue to grow their revenue from their existing customers as they seek to add premium features and additional user licenses, as reflected by their dollar-based net revenue retention rate of 120% and 114% during the years ended December 31, 2019 and 2020, respectively.

Continue to innovate and develop new products and features. They continue to invest in research and development to enhance their platform and release new products and features while bolstering one of the largest independent data sets for online visibility. They maintain close relationships with their customer base whom provide them with frequent and real-time feedback, which they leverage to rapidly update and optimize their platform. The release of new products, tools, add-ons, and features has enabled them to drive higher monetization over time as they have increased their ARR per paying customer from $1,892 as of December 31, 2019 to $2,123 as of December 31, 2020. For example, they released their premium Competitive Intelligence add-on offering in the first quarter of 2019 and in eight quarters have scaled it to over $6.8 million in ARR.

Pursue opportunistic M&A. Their management team expects to continue to allocate resources to identify, evaluate, and execute strategic acquisitions. For example, they acquired Prowly.com sp. z o. o. (“Prowly”) in August 2020 to expand their technological capabilities and solutions offerings. Prowly significantly accelerated their product expansion into the digital PR software space and added four new product categories, as defined by G2, to their product portfolio.

Company's Unique Strengths

Robust, proprietary technology platform. They developed their technology platform over the last 12 years, leveraging machine learning to aggregate, cleanse, and analyze an immense amount of proprietary and third-party unstructured data. Their data assets include over 200 million domains, 20 billion keywords, click stream panel data from billions of events per week, over 33 trillion backlinks, over 17 billion URLs crawled per day on average, 310 million Google Display Network banner advertisements, over 1 billion events analyzed per day, and a range of data aggregated from social media networks, all of which scale continuously as customers use their platform.

All-in-one SaaS solution to provide comprehensive online visibility. Their software products cover key aspects of online visibility, including SEO, SEM, content, advertising, competitive research, SMM, and digital PR. Their comprehensive solution is built with differentiated insights into traffic sources for specific sites, analysis of drivers of traffic to a company’s and its competitors’ websites, the keywords that are driving this traffic, and the effectiveness of a company’s content marketing strategy.

End-to-end workflows with third-party integrations. Their platform maintains a range of seamless third-party integrations for data, workflow, and reporting capabilities, enabling their customers to manage every critical step in optimizing their online visibility. Notable integrations include Google Analytics, YouTube, Facebook, Twitter, Domo, Yext, and Microsoft Outlook.

Intuitive, easy-to-use platform. Their SaaS platform prioritizes the customer experience and promotes collaboration across functional teams. They have developed easy-to-use dashboards, report builders, project sharing, and task management capabilities that streamline the analytics process for their customers through an intuitive and modern customer experience, while enabling intra-company teams to work together seamlessly to manage a company’s online visibility.

Strong value proposition. Their comprehensive product suite delivers differentiated insights through a singular platform that enables companies to efficiently manage online visibility, reduce traffic acquisition costs, promote consumer engagement, minimize the cost associated with managing multiple third-party vendors, and acquire new customers.

Company's Unique Risks

Their business and operating results will be harmed if their paying customers do not upgrade their premium subscriptions or if they fail to purchase additional products.

If they fail to attract new potential customers through unpaid and paid marketing efforts, register them for trials, and convert them into paying customers, their operating results would be harmed.

They have incurred losses in the past and may not achieve profitability in the future. They have incurred annual net losses since 2016 and expect to continue to incur net losses in the future. They incurred net losses of $10.2 million and $7.0 million for the years ended December 31, 2019 and 2020, respectively. As of December 31, 2020, they had an accumulated deficit of $35.8 million. They do not know if they will be able to achieve or sustain profitability in the future.

Their products depend on publicly available and paid third-party data sources, and, if they lose access to data provided by such data sources or the terms and conditions on which they obtain such access become less favorable, their business could suffer.

Changes by search engines, social networking sites, and other third-party services to their underlying technology configurations or policies regarding the use of their platforms and/or technologies for commercial purposes, including anti-spam policies, may limit the efficacy of certain of their products, tools, and add-ons and as a result, their business may suffer.

If third-party applications change such that they do not or cannot maintain the compatibility of their platform with these applications or if they fail to integrate with or provide third-party applications that their customers desire to use with their products, demand for their solutions and platform could decline.

If they fail to anticipate and adapt to new and increasingly prevalent social media platforms, other competing products and services that do so more effectively could surpass them and lead to decreased demand for their platform and products.

Failures or loss of, or material changes with respect to, the third-party hardware, software, and infrastructure on which they rely, including third-party data center hosting facilities and third-party distribution channels to support their operations, could adversely affect their business.

A significant portion of their operations is located outside of the United States, which subjects them to additional risks, including increased complexity, the costs of managing international operations, geopolitical instability, and fluctuations in currency exchange rates.

The effects of the COVID-19 pandemic are uncertain and may materially affect their customers or potential customers and how they operate their business, and the duration and extent to which the pandemic continues to threaten their future operating results remains uncertain. Their customers, particularly small-to-medium sized businesses (“SMBs”) and marketing agencies focused on SMBs, which have been particularly impacted by the COVID-19 pandemic, have reduced and may further reduce their technology or sales and marketing spending or delay purchasing decisions, which could result in slowed growth, reduced demand from new and existing SMB customers, and/or lower dollar-based net revenue retention rates, which could materially and adversely impact their business. In March 2020, their paying customer growth rate was relatively flat compared to their paying customer growth rate in February 2020. However, in April 2020 their paying customer growth rate declined, which they believe was primarily a result of the COVID-19 pandemic and the related socioeconomic impacts. In response, they offered free or discounted pricing to certain paying customers contemplating canceling their premium subscriptions as a remedial measure to retain them. In response to the COVID-19 pandemic, they temporarily closed all of their offices (including their headquarters in Boston, Massachusetts, and offices in Trevose, Pennsylvania, Dallas, Texas, Prague, Czech Republic, Limassol, Cyprus, and St. Petersburg, Russia), subsequently reopened certain offices at reduced capacity, enabled their employees to work remotely, implemented temporary travel restrictions for all non-essential business, and shifted company events to virtual-only experiences. They may deem it advisable to similarly alter, postpone, or cancel additional events in the future.

Their referral partners and resellers provide revenue to their business, and they benefit from their association with them. Their failure to maintain successful relationships with these partners could adversely affect their business.

If the use of cookies or other tracking technologies becomes subject to unfavorable legislation or regulation, is restricted by internet users or other third parties or is blocked or limited by users or by technical changes on end users’ devices, their ability to attract new customers and to develop and provide certain products could be diminished or eliminated.

Changes in legislation or requirements related to automatically renewing subscription plans, or their failure to comply with existing or future regulations, may adversely impact their business.

Federal, state, and foreign laws regulate internet tracking software, the sending of commercial emails and text messages, and other activities, which could impact the use of their platform and products, and potentially subject them to regulatory enforcement or private litigation.

They cannot predict the impact their dual structure may have on the market price of their Class A common stock. They cannot predict whether their dual class structure, combined with the concentrated control of their stockholders who held their capital stock prior to the completion of their offering, including their executive officers, employees, and directors and their affiliates, will result in a lower or more volatile market price of their Class A common stock or in adverse publicity or other adverse consequences. For example, certain index providers have announced restrictions on including companies with multiple class share structures in certain of their indices.

The dual class structure of their common stock has the effect of concentrating voting control with those stockholders who held their capital stock prior to the completion of this offering, including their directors, executive officers, and their affiliates, who will hold in the aggregate 92% of the voting power of their capital stock upon the completion of this offering without giving effect to any purchases that may be made through their directed share program, which will limit or preclude your ability to influence corporate matters. Their Class B common stock has ten votes per share, and their Class A common stock, which is the stock they are offering pursuant to this prospectus, has one vote per share. Upon the completion of this offering, their directors, executive officers, and their affiliates, will hold in the aggregate 92% of the voting power of their capital stock without giving effect to any purchases that may be made through their directed share program. Because of the ten-to-one voting ratio between their Class B common stock and Class A common stock, the holders of their Class B common stock collectively will continue to control a majority of the combined voting power of their common stock and therefore will be able to control all matters submitted to their stockholders for approval. 

Bottom Line

For the years ended December 31, 2019 and 2020, their revenue was $92.1 million and $124.9 million, respectively, representing growth of 35.6%. For the years ended December 31, 2019 and 2020, their net loss was $10.2 million and $7.0 million, respectively.

They are a leading online visibility management software-as-a-service platform. They enable companies globally to identify and reach the right audience for their content, in the right context, and through the right channels. Their proprietary software-as-a-service (“SaaS”) platform enables them to aggregate and enrich trillions of data points collected from over 200 million unique domains. As of December 31, 2019 and 2020, their differentiated platform empowered over 334,000 and 404,000 active free customers, respectively, and over 54,000 and 67,000 paying customers, respectively, in over 135 and 142 countries, respectively. With so many different sources of media competing for customers’ attention, it has become increasingly difficult for companies to be discovered by, and engage with, their customers. Their fully integrated SaaS platform leverages their proprietary technology, differentiated data, and actionable insights to improve online visibility. Their ability to aggregate, crawl, and process massive data sets, including search engine, website traffic, backlink, online advertising, panel, and social media data, combined with their ability to obtain data from their customers through APIs, enables their software to generate a comprehensive view of a company’s online visibility profile and identify the specific keywords, advertisements, third-party websites, and content that are driving traffic. Some large technology platforms including Google and Facebook offer their own solutions but are incentivized to prioritize their own paid channels, lack independence, and do not operate across rival networks. As their data assets grow, their ability to provide insights improves, attracting more customers to their platform and enabling them to invest in new and existing products, thereby further strengthening their competitive position. They offer their solutions on a multi-price point, recurring subscription basis, which provides incremental levels of access to their over 50 products, tools, and add-ons across online visibility management. They utilize a highly efficient, low-touch sales approach focused on driving customers to their platform through a self-service model, allowing their sales team to focus on retention and account expansion. Their multi-price point structure also drives meaningful upsell opportunities through higher usage limits, greater product functionality, additional user licenses, and product add-ons, as reflected by their dollar-based net revenue retention rate of 120% and 114% during the years ended December 31, 2019 and 2020, respectively, and their compounded average annual revenue growth rate of over 50% between the years ended December 31, 2016 and December 31, 2020.

They estimate that, based on their current average customer spending levels, the annual global potential market opportunity for their online visibility management SaaS platform is currently $13 billion. Approximately 94.9% of their customers are in the small and medium sized category and in such category their customers had an ARR per paying customer of $2,000 as of December 31, 2020, and their large enterprise customers had an ARR per paying customer of $4,200 as of December 31, 2020. With approximately 54% of their revenue coming from customers outside of the United States in 2020, they believe the opportunity internationally is at least as large as in the United States. They believe that a 50% online penetration estimate for the small company segment is conservative as small companies are continuing to shift their operations online, particularly in response to the COVID-19 pandemic. As such, at 100% penetration, they estimate that their global annual potential market opportunity is over $20 billion, with $150 million of such annual global potential market opportunity attributable to large enterprise customers.

They expect to continue to target new customers who have not yet adopted online visibility management solutions and those who are currently using their free offering. They expect to continue to grow their revenue from their existing customers as they seek to add premium features and additional user licenses, as reflected by their dollar-based net revenue retention rate of 120% and 114% during the years ended December 31, 2019 and 2020, respectively. They continue to invest in research and development to enhance their platform and release new products and features while bolstering one of the largest independent data sets for online visibility. The release of new products, tools, add-ons, and features has enabled them to drive higher monetization over time as they have increased their ARR per paying customer from $1,892 as of December 31, 2019 to $2,123 as of December 31, 2020. Their management team expects to continue to allocate resources to identify, evaluate, and execute strategic acquisitions.

Their data assets include over 200 million domains, 20 billion keywords, click stream panel data from billions of events per week, over 33 trillion backlinks, over 17 billion URLs crawled per day on average, 310 million Google Display Network banner advertisements, over 1 billion events analyzed per day, and a range of data aggregated from social media networks, all of which scale continuously as customers use their platform. Their comprehensive solution is built with differentiated insights into traffic sources for specific sites, analysis of drivers of traffic to a company’s and its competitors’ websites, the keywords that are driving this traffic, and the effectiveness of a company’s content marketing strategy. Their platform maintains a range of seamless third-party integrations for data, workflow, and reporting capabilities, enabling their customers to manage every critical step in optimizing their online visibility. They have developed easy-to-use dashboards, report builders, project sharing, and task management capabilities that streamline the analytics process for their customers through an intuitive and modern customer experience, while enabling intra-company teams to work together seamlessly to manage a company’s online visibility. Their comprehensive product suite delivers differentiated insights through a singular platform that enables companies to efficiently manage online visibility, reduce traffic acquisition costs, promote consumer engagement, minimize the cost associated with managing multiple third-party vendors, and acquire new customers.

Their business and operating results will be harmed if their paying customers do not upgrade their premium subscriptions or if they fail to purchase additional products. If they fail to attract new potential customers through unpaid and paid marketing efforts, register them for trials, and convert them into paying customers, their operating results would be harmed. They have incurred annual net losses since 2016 and expect to continue to incur net losses in the future. They incurred net losses of $10.2 million and $7.0 million for the years ended December 31, 2019 and 2020, respectively. As of December 31, 2020, they had an accumulated deficit of $35.8 million. They do not know if they will be able to achieve or sustain profitability in the future. Their products depend on publicly available and paid third-party data sources, and, if they lose access to data provided by such data sources or the terms and conditions on which they obtain such access become less favorable, their business could suffer. Changes by search engines, social networking sites, and other third-party services to their underlying technology configurations or policies regarding the use of their platforms and/or technologies for commercial purposes, including anti-spam policies, may limit the efficacy of certain of their products, tools, and add-ons and as a result, their business may suffer. If third-party applications change such that they do not or cannot maintain the compatibility of their platform with these applications or if they fail to integrate with or provide third-party applications that their customers desire to use with their products, demand for their solutions and platform could decline. If they fail to anticipate and adapt to new and increasingly prevalent social media platforms, other competing products and services that do so more effectively could surpass them and lead to decreased demand for their platform and products. Failures or loss of, or material changes with respect to, the third-party hardware, software, and infrastructure on which they rely, including third-party data center hosting facilities and third-party distribution channels to support their operations, could adversely affect their business. A significant portion of their operations is located outside of the United States, which subjects them to additional risks. Their customers, particularly small-to-medium sized businesses (“SMBs”) and marketing agencies focused on SMBs, which have been particularly impacted by the COVID-19 pandemic, have reduced and may further reduce their technology or sales and marketing spending or delay purchasing decisions, which could result in slowed growth, reduced demand from new and existing SMB customers, and/or lower dollar-based net revenue retention rates. In response to the COVID-19 pandemic, they temporarily closed all of their offices, subsequently reopened certain offices at reduced capacity, enabled their employees to work remotely, implemented temporary travel restrictions for all non-essential business, and shifted company events to virtual-only experiences. They may deem it advisable to similarly alter, postpone, or cancel additional events in the future. Their referral partners and resellers provide revenue to their business, and they benefit from their association with them. Their failure to maintain successful relationships with these partners could adversely affect their business. If the use of cookies or other tracking technologies becomes subject to unfavorable legislation or regulation, is restricted by internet users or other third parties or is blocked or limited by users or by technical changes on end users’ devices. Changes in legislation or requirements related to automatically renewing subscription plans, or their failure to comply with existing or future regulations, may adversely impact their business. Federal, state, and foreign laws regulate internet tracking software, the sending of commercial emails and text messages, and other activities, which could impact the use of their platform and products, and potentially subject them to regulatory enforcement or private litigation. They cannot predict the impact their dual structure may have on the market price of their Class A common stock. Certain index providers have announced restrictions on including companies with multiple class share structures in certain of their indices. The dual class structure of their common stock has the effect of concentrating voting control with those stockholders who held their capital stock prior to the completion of this offering, including their directors, executive officers, and their affiliates, who will hold in the aggregate 92% of the voting power of their capital stock upon the completion of this offering without giving effect to any purchases that may be made through their directed share program, which will limit or preclude your ability to influence corporate matters.