EverQuote (EVER) risk factors, FY2024 10-K

Risks Related to Our Business and Industry

1. 01We generated a significant portion of our revenue in recent periods from a small number of customers, and our results of operations could be adversely affected and stockholder value harmed if we lose business from these customers
2. 02If the way cookies are used or shared, or the use or transfer of cookies is restricted by third parties outside of our control or becomes subject to unfavorable legislation or regulation, our ability to develop and provide certain products or services could be affected
3. 03Our business could be materially and adversely affected by a cybersecurity breach or other attack, failure or interruption involving our computer systems or our third-party service providers
4. 04We may use AI in our business, and challenges with properly managing its use could result in reputational harm, competitive harm, and legal liability, and adversely affect our results of operations
5. 05respect to both the ability to adequately protect intellectual property underlying AI systems and software as well as inadvertent infringement. Any of these potential risks could result in a material and adverse effect on our business, financial condition, operating results, cash flows and prospects
6. 06If we fail to compete effectively against companies engaged in digital customer acquisition, including competitors and other technology companies, we could lose customers and our revenue may decline
7. 07We rely on the performance of highly skilled personnel to operate our business, and if we are unable to retain, attract, develop and motivate well-qualified employees, our business and results of operations could be harmed
8. 08We are subject to a number of risks related to the credit card and debit card payments we accept
9. 09We have $25.0 million available for borrowing under our revolving line of credit with Western Alliance Bank, and in the future we could incur indebtedness beyond our revolving line of credit
10. 10placing us at a competitive disadvantage compared to our competitors that have less debt or better debt servicing options

Risks related to Laws and Regulations

1. 11We are subject to regulation regarding the insurance industry
2. 12We are subject to regulation regarding data privacy and security
3. 13Foreign laws and regulations such as the United Kingdom General Data Protection Regulation, or UK GDPR, may also apply to our Northern Ireland operations and employees. The UK GDPR includes a range of compliance obligations and penalties for non-compliance that are significant
4. 14We are subject to regulation regarding telemarketing and text message marketing campaigns
5. 15We are subject to regulation regarding email marketing campaigns
6. 16We may become subject to litigation, audit or investigation, which could result in financial liability, fines and penalties, restrictions on our operations or reputational damage

Risks Related to Our Intellectual Property

1. 17We may not be able to adequately protect our intellectual property rights
2. 18We may in the future be subject to intellectual property disputes, which are costly to defend and could harm our business and operating results
3. 19Even if these matters do not result in litigation or are resolved in our favor or without significant cash settlements, these matters, and the time and resources necessary to litigate or resolve them, could harm our business, our operating results and our reputation
4. 20Confidentiality agreements with employees and others may not adequately prevent disclosure of trade secrets and other proprietary information
5. 21Our use of “open source” software could adversely affect our ability to protect our proprietary software and subject us to possible litigation
6. 22Taxing authorities may assert that we should have collected or in the future should collect sales, use, value added or similar taxes, and we could be subject to liability with respect to past or future sales, which could adversely affect our operating results

Risks Related to Our Class A Common Stock

1. 23An active trading market for our Class A common stock may not be sustained
2. 24The market price of our Class A common stock has been and may continue to be volatile, which could result in substantial losses for investors and could subject us to securities class action litigation
3. 25announcements regarding industry consolidation
4. 26Our status as a “controlled company” could make our Class A common stock less attractive to some investors or otherwise harm our stock price
5. 27the board of directors maintain a compensation committee with prescribed duties and a written charter and comprised solely of independent directors
6. 28A significant portion of our total outstanding shares may be sold into the public market in the near future, which could cause the market price of our Class A common stock to drop significantly, even if our business is doing well
7. 29Anti-takeover provisions in our restated certificate of incorporation and our amended and restated bylaws, as well as provisions of Delaware law, might discourage, delay or prevent a change in control of our company or changes in our management and, therefore, depress the trading price of our Class A common stock
8. 30limiting the liability of, and providing indemnification to, our directors and officers