EverCommerce (EVCM) risk factors, FY2025 10-K

Risks Related to Our Business

1. 01Our limited operating history and our evolving business make it difficult to evaluate our future prospects and the risks and challenges we may encounter
2. 02Our historical growth rates may not be sustainable or indicative of future growth
3. 03We have experienced net losses in the past and we may not achieve profitability in the future30% rewritten
4. 04We may continue to experience significant quarterly and annual fluctuations in our operating results due to a number of factors, which makes our future operating results difficult to predict
5. 05We may not be able to continue to expand our share of our existing vertical markets or expand into new vertical markets, which would inhibit our ability to grow and increase our profitability
6. 06We face intense competition in each of the industries in which we operate, which could negatively impact our business, results of operations and financial condition and cause our market share to decline
7. 07The industries in which we operate are rapidly evolving and the market for technology-enabled services that empower SMBs is relatively immature and unproven. If we are not successful in promoting the benefits of or maintaining the competitiveness of our solutions and services, our growth may be limited
8. 08Consolidation in the industries in which we operate could decrease demand for our solutions and services by existing and potential clients in such industries
9. 09If we cannot keep pace with rapid developments and changes in the electronic payments market or are unable to introduce, develop and market new and enhanced versions of our software solutions, we may be put at a competitive disadvantage with respect to our services that incorporated payment technology
10. 10Real or perceived errors, failures or bugs in our solutions could adversely affect our business, results of operations, financial condition and growth prospects
11. 11We and our third-party providers are exposed to cybersecurity risks and incidents which may result in damage to our brand and reputation, material financial penalties, and legal liability, which could in turn materially adversely affect our business, results of operations, and financial conditionNew
12. 12We are developing and/or implementing artificial intelligence, machine learning, and automated decision-making technologies (collectively, “AI Technologies”) throughout our business, and are making significant investments in this area35% rewritten
13. 13Our estimated total addressable market is subject to inherent challenges and uncertainties. If we have overestimated the size of our total addressable market or the various markets in which we operate, our future growth opportunities may be limited
14. 14We calculate certain operational metrics using internal systems and tools and do not independently verify such metrics. Certain metrics are subject to inherent challenges in measurement, and real or perceived inaccuracies in such metrics may harm our reputation and negatively affect our business
15. 15Failure to effectively develop and expand our sales and marketing capabilities could harm our ability to increase our customer base and achieve broader market acceptance and utilization of our solutions
16. 16If we are not able to maintain and enhance our reputation and brand recognition, our business and results of operations may be harmed
17. 17If we are unable to retain our current customers, which are primarily SMBs, or sell additional functionality and services to them, our revenue growth may be adversely affected
18. 18Impairment in the value of our goodwill or intangible assets has adversely impacted and may in the future have a material adverse effect on our operating results and financial condition
19. 19A future pandemic, epidemic or outbreak of an infectious disease could impact, our business, financial condition and results of operations, as well as the business or operations of third parties with whom we conduct business
20. 20We are subject to economic and political risk, the business cycles of our clients and changes in the overall level of consumer and commercial spending, which could negatively impact our business, financial condition and results of operations
21. 21If we are unable to retain our personnel and hire additional skilled personnel, we may be unable to achieve our goals
22. 22We may be unsuccessful in achieving our objectives through acquisitions, dispositions or other strategic transactions
23. 23The occurrence of any of these factors may result in a decrease in any or all acquisition activity and otherwise adversely impact our operations, which may lead to less growth and a deterioration of our financial and operational condition
24. 24Our indebtedness could adversely affect our financial health and competitive position
25. 25Our ability to use our net operating losses to offset future taxable income may be subject to certain limitations
26. 26Government healthcare regulation, healthcare industry standards and other requirements create risks and challenges with respect to our compliance efforts and our business strategies within Health Services
27. 27Scrutiny on environmental sustainability and social initiatives could increase our costs, harm our reputation and adversely impact our financial results57% rewritten

Risks Related to Intellectual Property

1. 28We may be unable to adequately protect or enforce, and we may incur significant costs in enforcing or defending, our intellectual property and other proprietary rights
2. 29We may be subject to patent, trademark and other intellectual property infringement claims, which may be time-consuming, and cause us to incur significant liability and increase our costs of doing business
3. 30We may be subject to claims asserting that our employees or consultants have wrongfully used or disclosed alleged trade secrets of their current or former employers or claims asserting ownership of what we regard as our own intellectual property
4. 31Our use of “open source” software could adversely affect our ability to offer our services and subject us to possible litigation
5. 32Our use of AI Technologies could adversely affect our ability to obtain intellectual property protection in our solutionsNew

Risks Related to Regulation

1. 33The regulatory framework governing the use of AI Technologies is rapidly evolving, and we cannot predict how future legislation and regulation will impact our ability to offer products or services that we develop which leverage AI Technologies57% rewritten
2. 34Through our relationships with third parties, including payment processors such as Worldpay, we must comply with certain laws. Our failure to comply could materially harm our business
3. 35If we fail to comply with complex procurement laws and regulations with respect to government contracts, we could lose business and be liable for various penalties
4. 36Our sending of commercial emails and text messages and certain other telephonic services must comply with the Telephone Consumer Protection Act, and future legislation, regulatory actions, or litigation could adversely affect our business
5. 37We are subject to anti-corruption, anti-bribery and similar laws, and non-compliance with such laws can subject us to criminal or civil liability and harm our business
6. 38The healthcare industry is heavily regulated at the local, state and federal levels. Our failure to comply with regulatory requirements could create liability for us or our customers, result in adverse publicity and negatively affect our business68% rewritten
7. 39Healthcare FraudNew
8. 40Security and Privacy of Health-Related Information
9. 41Promoting Interoperability Programs and Health IT Certification
10. 42Information Blocking and Interoperability Rules

Risks Related to Ownership of Our Common Stock

1. 43Our stock price may be volatile or may decline regardless of our operating performance, resulting in substantial losses for investors
2. 44The parties to our sponsor stockholders agreement hold a substantial portion of our outstanding common stock, and such parties interests may conflict with our interests and the interests of other stockholders
3. 45Substantial future sales by the parties to our stockholders agreements or other holders of our common stock, or the perception that such sales may occur, could depress the price of our common stock
4. 46We are a “controlled company” under the corporate governance rules of The Nasdaq Stock Market and, as a result, qualify for, and rely on, exemptions from certain corporate governance requirements. You do not have the same protections afforded to stockholders of companies that are subject to such requirements
5. 47If securities or industry analysts do not publish research or reports about our business, or they publish negative reports about our business, our share price and trading volume could decline
6. 48We are an “emerging growth company” and our compliance with the reduced reporting and disclosure requirements applicable to “emerging growth companies” may make our common stock less attractive to investors
7. 49We incur significant increased costs as a result of operating as a public company, and our management is required to devote substantial time to new compliance initiatives
8. 50Delaware 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 more difficult, limit attempts by our stockholders to replace or remove our current management and limit the market price of our common stock
9. 51Our amended and restated certificate of incorporation provided that the doctrine of “corporate opportunity” does not apply with respect to certain parties to our stockholders agreements and any director or stockholder who is not employed by us or our subsidiaries

General Risk Factors

1. 52Because we maintain and may expand our business that is located outside of the United States, our business is susceptible to risks associated with international operations
2. 53Changes in accounting rules, assumptions and/or judgments could materially and adversely affect us
3. 54Litigation and the outcomes of such litigation could negatively impact our future financial condition and results of operations
4. 55We may be subject to additional tax liabilities in connection with our operations or due to future legislation, each of which could materially impact our financial position and results of operation
5. 56We do not intend to pay dividends for the foreseeable future
6. 57We primarily depend on our subsidiaries for cash to fund operations and expenses, including future dividend payments, if any