Braze (BRZE) risk factors, FY2025 10-K

Risks Related to Our Growth and Capital Requirements

1. 01Unstable market and economic conditions may have serious adverse consequences on our business, financial condition and share price
2. 02Our rapid revenue growth may not be indicative of our future revenue growth. Our rapid revenue growth also makes it difficult to evaluate our future prospects and may increase the risk that we will not be successful
3. 03We may require additional capital to support business growth, and this capital might not be available on acceptable terms, if at all
4. 04We have a limited history operating at our current scale, and our future results of operations may fluctuate significantly due to a wide range of factors, which make it difficult to forecast our future results of operations
5. 05We have a history of operating losses and may not achieve or sustain profitability in the future
6. 06The estimates of market opportunity and forecasts of market growth may prove to be inaccurate. Even if the market in which we compete achieves the forecasted growth, our business could fail to grow at similar rates, if at all
7. 07We track certain operational metrics with internal systems and tools and do not independently verify such metrics. Certain of our operational metrics are subject to inherent challenges in measurement, and any real or perceived inaccuracies in such metrics may adversely affect our business and reputation

Risks Related to Our Business and Our Brand

1. 08We face intense competition, including from well-established companies that offer products that compete with ours. We may lack sufficient financial or other resources to maintain or improve our competitive position, which may harm our ability to add new customers, retain existing customers, and grow our business
2. 09If we are unable to attract new customers and renew existing customers, our business, financial condition and results of operations will be adversely affected
3. 10If we fail to adapt and respond effectively to rapidly changing technology, evolving industry standards, or changing regulations, or to changing customer or consumer needs, requirements or preferences, our platform may become less competitive
4. 11subscriptions and may be required to offer terms less favorable to us for new and renewal agreements, particularly for mid- to large-size enterprises that may demand substantial price discounts as part of the negotiation of subscription contracts
5. 12Failure to effectively develop our sales and marketing capabilities could harm our ability to expand our customer base and achieve broader market adoption of our platform and products
6. 13We are dependent on a single platform, and the failure to achieve continued market acceptance of our platform could cause our results of operations to suffer
7. 14If our platform fails to perform properly or there are defects or disruptions in the rollout of our platform updates or enhancements, our reputation could be adversely affected, our market share could decline, and we could be subject to liability claims
8. 15The costs we would be forced to incur to correct any material defects or errors could be substantial and could adversely affect our business, financial condition and results of operations
9. 16We may need to reduce prices or change our pricing model to remain competitive
10. 17Our sales cycle with large enterprise customers can be long and unpredictable, and our sales efforts require considerable time and expense
11. 18Our business and reputation could be adversely affected if our customers are not satisfied with the integration, implementation, or services provided by us or our partners
12. 19Because we generally recognize revenue ratably over the term of each subscription agreement, downturns or upturns in our sales may not be immediately reflected in our financial condition and results of operations
13. 20If we fail to maintain and enhance our brand, our ability to expand our customer base may be impaired and our business, financial condition and results of operations may suffer
14. 21If we fail to manage our growth effectively, we may be unable to execute our business plan, maintain high levels of service and customer satisfaction or adequately address competitive challenges
15. 22We anticipate that our operations will continue to increase in complexity as we grow, which will create management challenges
16. 23We depend on our senior management team and the loss of one or more key employees or an inability to attract and retain highly skilled employees could adversely affect our business
17. 24If we are unable to maintain our culture and core values as we grow, we could lose the innovation, teamwork, passion and focus on execution that we believe contribute to our success, and our business may be harmed
18. 25Indemnity provisions in various agreements potentially expose us to substantial liability for intellectual property infringement, violations of privacy, data protection and other laws, regulations or contractual obligations, data breaches and other losses
19. 26We have a limited history of operating with a substantial remote workforce and the long-term impact of this workplace arrangement on our financial results and business operations is uncertain
20. 27Acquisitions, strategic investments, partnerships or alliances pose integration challenges, divert the attention of management, disrupt our business, dilute stockholder value and adversely affect our business, financial condition and results of operations

Risks Related to Our Dependence on Third Parties

1. 28Our growth depends in part on the success of our strategic relationships with third parties

Risks Related to Privacy, Data Security and Data Protection Laws

1. 29We are subject to stringent and changing laws, regulations, rules, industry standards and contractual obligations related to privacy, data security and data protection. The restrictions and costs imposed by these requirements and our actual or perceived failure to comply with them, could harm our business
2. 30For more information on the privacy, data security and data protection laws and regulations to which we are or may become subject, see the section titled “Business – Privacy, Data Security and Data Protection” in our Annual Report

Risks Related to Other Laws and Litigation

1. 31Changes in laws and regulations related to the internet or changes in the internet infrastructure itself may diminish the demand for our platform and could have a negative impact on our business
2. 32charges could limit the growth of internet-related commerce or communications generally, resulting in reductions in the demand for internet-based solutions such as ours
3. 33Any future litigation against us could be costly and time-consuming to defend
4. 34If we fail to provide services that our customers can use in compliance with regulations and/or industry standards, our revenue and results of operations could be harmed
5. 35We are subject to anti-corruption, anti-bribery, anti-money laundering and similar laws, and non-compliance with such laws can subject us to criminal or civil liability and harm our business, financial condition and results of operations
6. 36We are subject to governmental export and import controls that could impair our ability to compete in international markets and subject us to liability if we violate the controls
7. 37Our international operations may subject us to potential adverse tax consequences
8. 38Our ability to use our net operating losses to offset future taxable income may be subject to certain limitations
9. 39Changes in our effective tax rate or tax liability may have an adverse effect on our results of operations
10. 40We could be required to collect additional sales taxes or be subject to other tax liabilities that may increase the costs our customers would have to pay for our products and adversely affect our results of operations

Risks Related to Intellectual Property

1. 41We employ third-party licensed software for use in or with our platform, and the inability to maintain these licenses or errors or vulnerabilities in the software we license could result in increased costs, or reduced service levels, which would adversely affect our business
2. 42We use open-source software in our products, which could negatively affect our ability to sell our services or subject us to litigation or other actions
3. 43Any failure to protect our proprietary technology and intellectual property rights could substantially harm our business, financial condition and results of operations
4. 44We may be subject to intellectual property rights claims by third parties, which are extremely costly to defend, could require us to pay significant damages and could limit our ability to use certain technologies
5. 45We could face liability, or our reputation might be harmed, as a result of the activities of our customers, the content sent through our platform or the data they store on our servers
6. 46Our use of artificial intelligence, or AI, and machine learning in our platform and our business, as well as our potential failure to effectively implement, use, and market these technologies, may result in reputational harm or liability, or could otherwise adversely affect our business

Risks Related to Socioeconomic Factors

1. 47Our future revenue and results of operations could be harmed if the increases in demand we have seen from certain industries as a result of the COVID-19 pandemic fail to continue over the long term
2. 48Natural catastrophic events and human-made problems such as climate change, power disruptions, computer viruses, global pandemics, data security breaches and terrorism may disrupt our business

Risks Related to Public Company Reporting and Public Disclosure Practices

1. 49We are subject to risks related to our environmental, social, and governance practices and disclosures

Risks Related to Ownership of Our Class A Common Stock

1. 50We do not intend to pay dividends for the foreseeable future and, as a result, your ability to achieve a return on your investment will depend on appreciation in the price of our Class A common stock
2. 51The dual class structure of our common stock has the effect of concentrating voting control with our executive officers, directors and significant holders of our capital stock, which limits the ability of holders of our Class A common stock to influence the outcome of important transactions
3. 52We cannot predict the impact our dual class structure may have on the market price of our Class A common stock
4. 53An active public trading market for our Class A common stock may not develop or be sustained
5. 54Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of our company more difficult, limit attempts by our stockholders to replace or remove our current management and limit the market price of our Class A common stock
6. 55The provision of our amended and restated certificate of incorporation requiring exclusive venue in the Court of Chancery in the State of Delaware and the federal district courts of the United States for certain types of lawsuits may have the effect of discouraging lawsuits against our directors and officers
7. 56Future sales of our Class A common stock in the public market could cause the market price of our Class A common stock to decline
8. 57The price of our Class A common stock may be volatile, and you may lose some or all of your investment
9. 58Our issuance of additional capital stock in connection with financings, acquisitions, investments, our equity incentive plans or otherwise will dilute all other stockholders
10. 59If securities or industry analysts do not publish research or reports about our business or publish negative reports about our business, our share price and trading volume could decline