DEF 14A of Cloudflare, Inc., Apr 19, 2024

DEF 14A of Cloudflare, Inc.

Filed Apr 19, 2024 · FY20230001477333-24-000036

Open on EDGAR

  1. Information Concerning Director Nominees

    Information Concerning Director Nominees Maria Eitel. Ms. Eitel has served on our Board of Directors since December 2018 and has served as Chair of our nominating and corporate governance committee since September 2023. Ms. Eitel previously served as Chair of our compensation committee from February 2019 until September 2023. From September 2015 until May 2021, Ms. Eitel served as the Co-Chair of the Nike Foundation, a non-profit organization funded by NIKE, Inc., and Chair of Girl Effect, an independent non-profit organization she founded with the goal of transforming the lives of adolescent girls. She served as the Founder, Chief Executive Officer, and President of the Nike Foundation from March 2005 to September 2015. From January 1998 to March 2005, Ms. Eitel was the first Vice President, Corporate Responsibility of NIKE, a designer, developer, and seller of athletic footwear, apparel, equipment, accessories, and services. Ms. Eitel holds a B.A. in Humanistic Studies from McGill University, an M.S. in Foreign Service from Georgetown University, and an Honorary Doctorate of Humane Letters from Babson College. Ms. Eitel was selected to serve on our Board of Directors because of her prior experience as an executive of a publicly traded company and from her background in corporate social responsibility. Matthew Prince. Mr. Prince is one of our Co-Founders and has served as our Chief Executive Officer and Chair of our Board of Directors since July 2009. He also co-founded Unspam Technologies, Inc., a software and services company, and has served as its Chair since December 2001. Mr. Prince holds a B.A. in English and a minor in Computer Science from Trinity College-Hartford, a J.D. from the University of Chicago Law School, and an M.B.A. from Harvard Business School. Mr. Prince was selected to serve on our Board of Directors because of the perspective and experience he brings as our Chief Executive Officer and as one of our Co-Founders. Katrin Suder. Dr. Suder has served as a member of our Board of Directors and as a member of our audit committee since August 2019, as well as a member of our nominating and corporate governance committee since September 2023. Since January 2019, she has been employed by TAE Advisory & Sparring GmbH, a consulting company which Dr. Suder co-founded, and previously also served as TAE's co-Chief Executive Officer until December 2023. From August 2018 until December 2022, Dr. Suder served as Chairperson of the Advisory Council on Digitalization to the German Federal Government. From August 2014 until April 2018, Dr. Suder served as State Secretary for the German Federal Ministry of Defense. From October 2000 to July 2014, she was with McKinsey & Company, a management consulting company, where she managed the German Public Sector Practice from 2010 to 2014. Dr. Suder currently serves on the supervisory board of LEG Immobilien SE, a German property company, and DHL, a logistic company. Dr. Suder holds a B.A. in German Literature and Theater and a Ph.D. in Computational Neuroscience from Ruhr University Bochum. Dr. Suder was selected to serve on our Board of Directors because of her experience at the intersection of technology, business, and policy.

  2. Information Concerning Directors Not Standing for Election at the Annual Meeting

    Information Concerning Directors Not Standing for Election at the Annual Meeting

  3. Continuing Directors

    Continuing Directors Mark Hawkins. Mr. Hawkins has served on our Board of Directors and as Chair of our audit committee since June 2022. He served as President and Chief Financial Officer Emeritus Advisor for Salesforce.com, Inc., a software company, from February 2021 to November 2021. Prior to that, he served as President and Chief Financial Officer and Principal Financial Officer of Salesforce.com, Inc. from August 2017 to January 2021, and as the Chief Financial Officer, Principal Financial Officer and Executive Vice President of Salesforce.com, Inc. from August 2014 to August 2017. From April 2009 to July 2014, Mr. Hawkins served as Executive Vice President, Chief Financial Officer, and Principal Financial Officer of Autodesk, Inc., a design software and services company. Mr. Hawkins previously served as Chief Financial Officer and Senior Vice President of Finance and Information Technology at Logitech International S.A., a global hardware company, from April 2006 to April 2009. Mr. Hawkins currently serves on the board of directors and audit and compensation committees of Toast, Inc., a software company, the board of directors and audit committee of Workday, Inc., a software company, and the board of directors and compensation and nominating and governance committees of SecureWorks Corp., a global cybersecurity company. In 2021, he briefly served on the board of directors of Fidelity National Information Services, Inc., a financial technology company, before stepping down from the role. He holds a B.A. in Operations Management from Michigan State University and an M.B.A from University of Colorado. He also completed the Advanced Management Program at Harvard Business School. Mr. Hawkins was selected to serve on our Board of Directors due to his experience as an officer and director of publicly traded software and technology companies and his financial expertise in the technology industry. Carl Ledbetter. Dr. Ledbetter has served as a member of our Board of Directors since November 2009 and as a member of our audit committee since December 2018. In addition, he has served as a member of our compensation committee since March 2021 and as Chair since September 2023. Dr. Ledbetter previously served as Chair of our nominating and corporate governance committee from August 2019 until September 2023. Dr. Ledbetter has served as the Chairman and Chief Technology Officer of SimpleRose, Inc., a software company, since July 2018 and as Chief Executive Officer of SimpleRose, Inc. since August 2019. He served as a Managing Director of Pelion Venture Partners, a venture capital firm, from June 2003 through June 2018 and as a Special Advisor from June 2018 until December 2019. Dr. Ledbetter has served on the boards of directors of four other public companies and more than thirty privately-held companies during his career. Dr. Ledbetter holds a B.S. in Mathematics from the University of Redlands, an M.S. in Mathematics from Brandeis University, and a Ph.D. in Mathematics from Clark University. Dr. Ledbetter was selected to serve on our Board of Directors because of his understanding of networking technology and his experience as a director of several technology companies. Scott Sandell. Mr. Sandell has served as a member of our Board of Directors since November 2010, as a member of our compensation committee since February 2019, and as our Lead Independent Director since September 2019. He has served as the Chairman, CEO and Chief Investment Officer of New Enterprise Associates, Inc. (NEA), a venture capital firm, since 2023. Previously, Mr. Sandell served as managing General Partner of NEA since April 2017, Co-Managing General Partner from March 2015 to April 2017, and as a General Partner since September 2000. Mr. Sandell joined NEA in January 1996 and served as head of the firm’s technology investing practice for 10 years. He currently serves on the board of directors and the leadership, diversity, equity, inclusion and compensation committee of Coursera, Inc., an online learnings platform, and the boards of directors of several privately-held companies. Mr. Sandell previously served on the board of directors of Bloom Energy Corporation, a provider of solid-oxide fuel cell systems, Robinhood Markets, Inc., a financial technology company, and Tuya, Inc., an IoT development platform service provider. Mr. Sandell holds an A.B. in Engineering from Dartmouth College and an M.B.A. from Stanford University. Mr. Sandell was selected to serve on our Board of Directors because of his leadership experience and experience as a director of both publicly and privately held technology companies. Michelle Zatlyn. Ms. Zatlyn is one of our Co-Founders and serves as our President and Chief Operating Officer. She served as our Head of User Experience from 2009 until she was appointed as our Chief Operating Officer in 2016 and President in 2020. Ms. Zatlyn has served as a member of our Board of Directors since November 2009. Ms. Zatlyn currently serves on the board of directors and the audit committee of Atlassian Corporation, Plc. She holds a B.Sc. in Chemistry and Business from McGill University and an M.B.A. from Harvard Business School. Ms. Zatlyn was selected to serve on our Board of Directors because of the perspective and experience she brings as our President and Chief Operating Officer and as one of our Co-Founders.

  4. Considerations in Evaluating Director Nominees

    Considerations in Evaluating Director Nominees

  5. Identifying and Evaluating Director Nominees

    Identifying and Evaluating Director Nominees Our Board of Directors has delegated to the nominating and corporate governance committee the responsibility of identifying suitable candidates for nomination to the Board of Directors (including candidates to fill any vacancies that may occur) and assessing their qualifications in light of the policies and principles in our corporate governance guidelines and the committee's charter. The nominating and corporate governance committee may gather information about the candidates through interviews, detailed questionnaires, comprehensive background checks, or any other means that the nominating and corporate governance committee deems to be appropriate in the evaluation process. The nominating and corporate governance committee then meets to discuss and evaluate the qualities and skills of each candidate, both on an individual basis and taking into account the overall composition and needs of the Board of Directors based on feedback collected through annual performance self-evaluations and skills assessments completed by our directors. Based on the results of the evaluation process, the nominating and corporate governance committee recommends candidates to the Board of Directors for its approval as director nominees for election to the Board of Directors.

  6. Non-Employee Director Compensation

    Non-Employee Director Compensation We have adopted a compensation policy for our non-employee directors. Under this director compensation policy, each non-employee director receives the cash and equity compensation for his or her board services described below. We also reimburse our non-employee directors for reasonable, customary, and documented travel expenses to board and committee meetings. This policy was developed with input from Compensia regarding practices and compensation levels at comparable companies. We considered and discussed these recommendations and data, and considered the specific duties and committee responsibilities of particular directors. After careful consideration of this information and the scope of the duties and responsibilities of our non-employee directors, our Board of Directors adopted and our stockholders approved the director compensation policy. We review the director compensation policy annually, and we continue to believe this policy provides reasonable compensation to our non-employee directors that is commensurate with their contributions and appropriately aligned with our peers. The policy includes a maximum annual limit of $750,000 of cash compensation and equity awards that may be paid, issued, or granted to a non-employee director in any fiscal year. For purposes of this limitation, the value of equity awards is based on the grant date fair value (determined in accordance with U.S. Generally Accepted Accounting Principles (GAAP)). Any cash compensation paid or equity awards granted to a person for his or her services as an employee, or for his or her services as a consultant (other than as a non-employee director), will not count for purposes of the limitation. The maximum limit does not reflect the intended size of any potential compensation or equity awards to our non-employee directors.

  7. Non-Employee Director Compensation Table

    Non-Employee Director Compensation Table The following table provides information regarding the total compensation that was earned by or paid to each of our non-employee directors for the year ended December 31, 2023. Directors who also serve as employees receive no additional compensation for their service as directors. During the fiscal year ended December 31, 2023, Mr. Prince, our Chief Executive Officer, and Ms. Zatlyn, our President and Chief Operating Officer, were each a member of our Board of Directors, as well as an employee, and thus received no additional compensation for his or her services as a director. See the section titled “Executive Compensation” for additional information regarding their compensation.

  8. Non-Employee Director Compensation Table

    | Name | Fees Earned or Paid in Cash($) | Stock Awards($)(1)(2) | Total($) | | Mark Anderson(3) | 40,000 | 199,965 | 239,965 | | Maria Eitel | 40,582 | 199,965 | 240,547 | | Mark Hawkins(4) | 50,000 | 199,965 | 249,965 | | Carl Ledbetter | 53,027 | 199,965 | 252,992 | | Scott Sandell | 36,000 | 199,965 | 235,965 | | Katrin Suder | 41,261 | 199,965 | 241,226 |

  9. Non-Employee Director Compensation Table

    _______________________ (1)The amounts reported represent the aggregate grant date fair value of the RSUs awarded under our 2019 Plan to our non-employee directors in accordance with the director compensation policy, calculated on the basis of the fair market value of the underlying shares of common stock on the grant date in accordance with FASB ASC Topic 718. Such grant date fair value does not take into account any estimated forfeitures related to service-based vesting conditions. The assumptions used in calculating the grant date fair value of the RSUs reported in this column are set forth in the Notes to our Consolidated Financial Statements included in our 2023 Annual Report. These amounts do not necessarily correspond to the actual value recognized or that may be recognized by the directors. (2)As of December 31, 2023, each non-employee director held 2,871 RSUs in connection with the annual award of RSUs granted to them on the date of our 2023 Annual Meeting in accordance with our director compensation policy (the 2023 Annual Award). 100% of the shares of Class A common stock underlying these RSUs vest on the earlier of (i) June 1, 2024 or (ii) the day prior to the date of the Annual Meeting, subject to the director's continued service to us through the applicable vesting date. (3)Mr. Anderson resigned from our Board of Directors on February 29, 2024. Accordingly, his fees for 2023 were paid in full and his fees for 2024 will be prorated for the portion of 2024 in which he served as a director and member of the compensation and nominating and corporate governance committees. Mr. Anderson has continued to vest in his outstanding 2023 Annual Award in accordance with its terms, as he has remained continuously in service to us as our President of Revenue following his resignation from our Board of Directors. (4)In addition to his 2023 Annual Award, Mr. Hawkins held 4,606 unvested RSUs in connection with the initial award of RSUs granted to him on the date of our 2022 Annual Meeting in accordance with our director compensation policy as of December 31, 2023. The shares of Class A common stock underlying these RSUs vest in equal annual installments on each of the first three anniversaries of the date of becoming a non-employee director, subject to his continued service to us through each applicable vesting date. PROPOSAL ONE:

  10. ELECTION OF DIRECTORS

    ELECTION OF DIRECTORS

  11. Executive Summary

    Executive Summary Who We Are We are a leading connectivity cloud company that delivers a broad range of services to businesses of all sizes and in all geographies, making them more secure, enhancing the performance of their business-critical applications, and eliminating the cost and complexity of managing individual network hardware. Our network serves as a scalable, easy-to-use, unified control plane to deliver security, performance, and reliability across on-premises, hybrid, cloud, and software-as-a-service (SaaS) applications. We serve comprehensive customer needs across security and connectivity, and increasingly, the distributed and programmable nature of our network is resulting in customers building their applications on top of our network, too — including both traditional applications and those that are enhanced with artificial intelligence. 2023 Business Highlights Our 2023 financial highlights included the following: •Revenue – Total revenue of $1,296.7 million, representing an increase of 33% year-over-year. •Gross Profit – GAAP gross profit was $989.7 million, or 76.3% gross margin, compared to $742.6 million, or 76.1%, in fiscal 2022. Non-GAAP gross profit was $1,015.8 million, or 78.3% gross margin, compared to $762.8 million, or 78.2%, in fiscal 2022. •Operating Income/Loss – GAAP loss from operations was $185.5 million, or 14.3% of total revenue, compared to a GAAP loss from operations of $201.2 million, or 20.6% of total revenue, in fiscal 2022. Non-GAAP income from operations was $122.0 million, or 9.4% of total revenue, compared to non-GAAP income from operations of $35.7 million, or 3.7% of total revenue, in fiscal 2022. •Net Income/Loss – GAAP net loss was $183.9 million, compared to a GAAP net loss of $193.4 million for fiscal 2022. Non-GAAP net income was $169.7 million, compared to non-GAAP net income of $44.4 million for fiscal 2022. GAAP net loss per basic and diluted share was $0.55, compared to a GAAP net loss per basic and diluted share of $0.59 for fiscal 2022. Non-GAAP net income per diluted share was $0.49, compared to non-GAAP net income per diluted share of $0.13 for fiscal 2022. •Cash Flow – Net cash flow from operating activities was $254.4 million, compared to $123.6 million for fiscal 2022. Free cash flow was $119.5 million, or 9% of total revenue, compared to negative $39.8 million, or 4% of total revenue, for fiscal 2022. To supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, we provide investors with certain non-GAAP financial measures, including non-GAAP gross profit, non-GAAP income from operations, non-GAAP loss from operations, non-GAAP net income, non-GAAP net loss, non-GAAP net income per share, non-GAAP net loss per share, and free cash flow. For a full reconciliation for each non-GAAP financial measure to the most directly comparable financial measure stated in accordance with GAAP, please see Exhibit 99.1 to our Current Report on Form 8-K and our 2023 Annual Report filed with the SEC on February 8, 2024 and February 21, 2024, respectively. 2023 Executive Compensation Highlights Our Board of Directors and the compensation committee took the following actions with respect to the compensation of our named executive officers for 2023 and 2024: •No Base Salary Increases – The annual base salaries of our named executive officers were maintained at their 2022 levels. •No Annual Cash Bonus Program – We did not have a cash bonus program in 2023 for our named executive officers, and historically have not maintained an annual cash bonus program for our named executive officers. •Long-Term Incentive Compensation for Messrs. Seifert and Kramer – In April 2023, we granted to Messrs. Seifert and Kramer long-term incentive compensation opportunities in the form of restricted stock unit (RSU) awards granted under the 2019 Plan that vest over three years and may be settled for 204,988 and 102,494 shares of our Class A common stock, respectively. •Amendment of Messrs. Seifert's and Kramer's Outstanding Performance Stock Options – Effective May 1, 2023, we amended performance-based stock options that previously had been granted to Messrs. Seifert and Kramer to purchase 555,000 and 330,000 shares of our Class A common stock, respectively, that vest and become exercisable only if we achieve certain stock price milestones and the named executive officer remains a “service provider” (as defined in the 2019 Plan) through the determination of the achievement of the milestones and through certain additional time-based vesting requirements (the Performance Options). The amendment of the Performance Options is described in more detail in “Compensation Elements — Long-Term Incentive Compensation – Amendment of Outstanding Performance Stock Options” below. •Long-Term Incentive Compensation for Co-Founders – In April 2023, we granted equity awards to Mr. Prince and Ms. Zatlyn (collectively, our Co-Founders) long-term incentive compensation opportunities in the form of RSU awards granted under the 2019 Plan that each vest over four years and may be settled for 307,482 shares of our Class A common stock. Pay-for-Performance We believe our executive compensation program is reasonable and competitive, and appropriately balances the goals of attracting, motivating, rewarding, and retaining our named executive officers with the goal of aligning their interests with those of our stockholders. The annual compensation of our named executive officers typically varies from year to year in a manner that is consistent with our “pay-for-performance” philosophy. Specifically, our executive compensation program emphasizes “variable” pay in the form of equity awards over “fixed” pay in the form of base salary. Executive Compensation Policies and Practices We endeavor to maintain sound governance standards consistent with our executive compensation policies and practices. The compensation committee evaluates our executive compensation program on a regular basis to ensure that it is consistent with our short-term and long-term goals given the dynamic nature of our business and the market in which we compete for executive talent. The following summarizes our executive compensation and related policies and practices that were in effect in 2023:

  12. Executive Summary

    | | What We Do | | What We Don't Do | | ☑ | Maintain an Independent Compensation Committee. The compensation committee consists solely of independent directors who establish our compensation policies and practices. | ☒ | Limited Perquisites. Perquisites or other personal benefits are not a material part of our compensation program for our named executive officers, and generally are only provided when they serve a legitimate business purpose (such as the security of our Co-Founders). | | ☑ | Retain an Independent Compensation Advisor. The compensation committee has engaged its own compensation consultant to provide information, analysis, and other advice on executive compensation independent of management. | ☒ | Limited Tax Reimbursements. We do not provide any tax reimbursement payments (including “gross-ups”) on any perquisites or other personal benefits, except in limited circumstances to achieve specific business objectives. | | ☑ | Annual Executive Compensation Review. The compensation committee conducts an annual review and approval of our compensation strategy, including a review and determination of our compensation peer group used for comparative purposes and a review of our compensation-related risk profile to ensure that our compensation programs do not encourage excessive or inappropriate risk-taking and that the level of risk that they do encourage is not reasonably likely to have a material adverse effect on us. | ☒ | No Excise Tax Payments on Future Post-Employment Compensation Arrangements. We do not provide any excise tax reimbursement payments (including “gross-ups”) on payments or benefits contingent upon a change in control of the company. | | ☑ | Use a Pay-for-Performance Philosophy. The majority of our named executive officers’ compensation opportunities consists of long-term incentive compensation in the form of equity awards. As a result of this emphasis on equity awards, a substantial portion of each named executive officer’s target total direct compensation is dependent upon our overall, long-term success (as measured through our stock price), thereby aligning the interests of our named executive officers and our stockholders. | ☒ | No Special Retirement, Health, or Welfare Benefits. We do not provide our named executive officers with any retirement, health, or welfare benefit programs, other than participation in our broad-based employee plans and programs on the same basis as our other full-time, salaried employees. |

  13. Executive Summary

    | ☑ | Stock Ownership Guidelines. We maintain a stock ownership policy that requires minimum ownership of shares of our common stock by our CEO, President, all Senior Vice Presidents and above (which includes all executive officers who are subject to Section 16 of the Exchange Act), and the non-employee members of our Board of Directors. | ☒ | No Hedging or Pledging of our Securities. We prohibit, absent a waiver from our CLO or our CFO, our named executive officers and the non-employee members of our Board of Directors from hedging or pledging our securities. | | ☑ | Compensation Recovery (“Clawback”) Policy. We have adopted a compensation recovery (“clawback”) policy that complies with Exchange Act Rule 10D-1 and the applicable listing standards of the NYSE and permits the company to recover annual and long-term incentives from our current and former executive officers. | ☒ | No “Single Trigger” Change in Control Severance Payments or Benefits. We do not provide “single trigger” change in control severance payments or benefits to our named executive officers. |

  14. Executive Compensation Philosophy and Objectives

    Executive Compensation Philosophy and Objectives Our executive compensation program is designed to: •attract, motivate, incentivize, and retain employees at the executive level who contribute to our long-term success; •provide compensation packages to our executives that are fair, easy to understand, and competitive; provide high retention value; and reward high performance and the achievement of our business objectives; and •effectively align our executives’ interests with those of our stockholders by focusing on long-term equity incentives that correlate with the growth of sustainable long-term value for our stockholders. Generally, we structure the annual compensation of our named executive officers using two principal elements: (1) base salary and (2) long-term incentive compensation opportunities in the form of equity awards. The design of our executive compensation program is influenced by a variety of factors, with the primary goals being to align the interests of our named executive officers and stockholders and to link pay to performance. We have not adopted policies or employed guidelines for allocating compensation between current and long-term compensation, between cash and non-cash compensation, or among different forms of non-cash compensation.

  15. Compensation-Setting Process

    •analyzed the adequacy of outstanding executive equity awards and consideration of the need for and appropriateness of future senior executive equity awards, including consideration of our compensation peer group’s practices, retention and motivation considerations, and corporate governance considerations; •reviewed our equity utilization rates compared to the competitive market and our compensation peer group practices; •conducted a risk assessment of our executive compensation program; •reviewed and analyzed the reports on our executive compensation program published by the major proxy advisory firms; •provided updates on corporate governance and regulatory issues and developments; •consulted with the compensation committee chair, other committee members, and the other advisors to the compensation committee between compensation committee meetings; and •provided support on other ad hoc matters throughout the year. Compensia also coordinated with our management for data collection and job matching for our executive officers. In 2023, Compensia did not provide any other services to us. The compensation committee has evaluated its relationship with Compensia and determined that such firm is independent and further determined that no conflict of interest has arisen as a result of the work performed by Compensia. Competitive Positioning For purposes of assessing our executive compensation against the competitive market for executive talent, the compensation committee reviews and considers the compensation levels and practices of a select group of peer companies. This compensation peer group consists of publicly-traded technology companies against which we compete for executive talent and that are similar to us in terms of revenue, market capitalization, and industry focus. The competitive data drawn from this compensation peer group is only one of several factors that the compensation committee considers, however, in formulating its recommendations for our Board of Directors with respect to the compensation of our named executive officers. The compensation committee reviews our compensation peer group at least annually and makes adjustments to its composition if warranted, taking into account changes in both our business and the businesses of the companies in the peer group. In July 2022, the compensation committee, with the assistance of Compensia, reviewed and updated our compensation peer group for use in making decisions and recommendations related to the compensation of our named executive officers for the second half of 2022 and 2023. These updates reflect recent acquisitions, changes in our market capitalization, and recognize our evolving business focus. In evaluating the companies comprising the compensation peer group at that time, Compensia considered the following criteria: •publicly-traded companies headquartered in the United States and traded on a major U.S. stock exchange; •cloud platform software companies (primary focus) and other software companies (secondary focus); •companies with similar revenues – within a range of approximately 0.5x to approximately 3.0x our then-current trailing four quarters revenue of approximately $731 million (approximately $365 million to approximately $2.2 billion); •companies with similar market capitalization – within a range of approximately 0.25x to approximately 4.0x our then-current market capitalization of approximately $20.4 billion (approximately $5.1 billion to approximately $81.8 billion); and •certain other factors, such as whether the company had a security-related focus, high revenue growth, and/or a high market capitalization to revenue multiple. Based on a review of the analysis prepared by Compensia, in July 2022 the compensation committee approved an updated compensation peer group consisting of the following companies:

  16. Compensation-Setting Process

    The compensation committee made two changes to our peer group in July 2022, removing Anaplan and Zendesk because of their pending acquisitions. In July 2023, the compensation committee, with the assistance of Compensia, reviewed and updated our compensation peer group for use in making decisions and recommendations related to the compensation of our named executive officers for the second half of 2023 and 2024. These updates reflect recent acquisitions and changes in our revenue and market capitalization. In evaluating the companies comprising the compensation peer group at that time, Compensia considered the same criteria as assessed in July 2022, except that the assessment of companies with similar revenue and market capitalization to ours was updated to reflect our then-current trailing four quarters revenue of approximately $1.1 billion and our then-current market capitalization of approximately $21.8 billion. As a result of this reassessment, the compensation committee made three changes to our peer group in July 2023, removing Coupa Software, Qualtrics International and RingCentral, with the resulting peer group consisting of:

  17. Compensation-Setting Process

    The compensation committee used data drawn from the companies in our compensation peer group, as well as Radford survey data drawn from a custom cut of the company’s peer companies that were also participants in the Radford survey, to evaluate the competitive market for executive talent when determining the total direct compensation packages for our named executive officers, including base salary and long-term incentive compensation opportunities.

  18. Compensation Elements

    Compensation Elements In 2023, the principal elements of our executive compensation program were base salary and long-term incentive compensation in the form of equity awards. Base Salary Base salary represents the fixed portion of the compensation of our named executive officers and is an important element of compensation intended to attract and retain highly talented individuals. Generally, we use base salary to provide each executive officer with a specified level of cash compensation during the year with the expectation that he or she will perform his or her responsibilities to the best of his or her ability and in our best interests. Historically, we have established the initial base salaries of our named executive officers through arm’s-length negotiation at the time we hire the individual, taking into account his or her position, qualifications, experience, prior salary level, and the base salaries of our other executive officers. Thereafter, the compensation committee reviews the base salaries of our named executive officers as part of its annual compensation review, with input from our Co-Founders (except with respect to their own base salaries), and recommends adjustments to our Board of Directors as it determines to be reasonable and necessary to reflect the scope of an executive officer’s performance, individual contributions and responsibilities, position in the case of a promotion, and market conditions. In April 2023, the compensation committee and our Board of Directors, including the Co-Founders (except with respect to their own base salaries), reviewed the base salaries of our named executive officers and determined to maintain the annual base salaries of our named executive officers at their 2022 levels as follows:

  19. Compensation Elements

    The base salaries paid to our named executive officers during 2023 are also set forth in the “2023 Summary Compensation Table” below. Cash Bonuses In 2023, as in past years, we did not maintain an annual cash bonus or other incentive plan for our named executive officers. Instead, our Board of Directors relied primarily on the long-term incentive compensation opportunities granted to our executive officers in the form of both previously granted and newly granted options to purchase shares of our common stock and/or RSU awards that may vest and be settled for shares of our common stock to incentivize them to increase the value of our common stock and create sustainable long-term value for our stockholders. Long-Term Incentive Compensation We view long-term incentive compensation in the form of equity awards as a critical component of our executive compensation program. The realized value of these equity awards bears a direct relationship to our stock price, and, therefore, these awards are an incentive for our named executive officers to create value for our stockholders. Equity awards also help us retain qualified executive officers in a competitive market. Long-term incentive compensation opportunities in the form of equity awards generally are granted to our named executive officers by our Board of Directors based on the recommendations of the compensation committee. Historically, we have used stock options and RSU awards to retain, motivate, and reward our named executive officers for long-term increases in the value of our common stock and, thereby, to align their interests with those of our stockholders. Because stock options provide for an economic benefit only in the event that our stock price increases over the exercise price of the option (which exercise price is equal to the fair market value of our common stock as of the date of grant), we believe stock options effectively align the interests of our executive officers with those of our stockholders and provide them with a significant incentive to manage our business from the perspective of an owner with an equity stake in the business. In addition, because they are subject to a multi-year vesting requirement, stock options serve our retention objectives since our named executive officers must remain continuously employed by us through the applicable vesting dates to have an opportunity to exercise their stock options. With respect to RSU awards, because they have value even in the absence of stock price appreciation, we believe they serve to incent and retain our named executive officers using fewer shares of our common stock than would be the case with a stock option. Since their value increases with any increase in the value of the underlying shares, RSU awards serve as an incentive which aligns with the long-term interests of our named executive officers and stockholders. Unlike stock options, however, RSU awards have real economic value when they vest even if the market price of our Class A common stock declines or stays flat, thus delivering more predictable value to our named executive officers. In addition, because they are subject to a multi-year vesting requirement, RSU awards serve our retention objectives since our named executive officers must remain continuously employed by us through the applicable vesting dates to fully earn these awards. 2023 Equity Awards for Messrs. Seifert and Kramer In April 2023, the compensation committee recommended to our Board of Directors that RSU awards be granted to Messrs. Seifert and Kramer after considering the factors described in “Compensation-Setting Process – Setting Target Total Direct Compensation” above, as well as the outstanding equity holdings of each of Messrs. Seifert and Kramer, the projected impact of the proposed awards on our earnings, the proportion of our total shares outstanding used for annual employee long-term incentive compensation awards (our “burn rate”) in relation to the median proportions of the companies in our compensation peer group, and the potential voting power dilution to our stockholders in relation to the median practice of the companies in our compensation peer group. The RSU awards granted to Messrs. Seifert and Kramer had target values of $12 million and $6 million, respectively, with the number of units to be determined based on the average closing market price of our Class A common stock for the trailing 30-trading day period ending on April 18, 2023. On April 19, 2023, our Board of Directors approved the grant of RSU awards to Messrs. Seifert and Kramer as follows:

  20. Compensation Elements

    | Named Executive Officer | RSU Award (target value) ($) | RSU Award (number of units) (#)(1) | | Thomas Seifert | 12,000,000 | 204,988 | | Douglas Kramer | 6,000,000 | 102,494 |

  21. Compensation Elements

    _______________________ (1)For information regarding how the aggregate grant date fair value of the RSU awards was calculated, see footnote 1 to the "2023 Summary Compensation Table" below. The RSU awards granted to Messrs. Seifert and Kramer vest in 12 equal quarterly installments over a three-year period, with the first vesting date on August 15, 2023, the vesting commencement date, subject to Messrs. Seifert’s and Kramer’s continued service to us through the applicable vesting dates. Each award is subject to the “double trigger” acceleration of vesting provisions applicable to the named executive officers pursuant to the terms of their participation in our Change in Control and Severance Policy (the Severance Policy). Each unit represents a right to receive one share of our Class A common stock for each unit that vests. 2023 Equity Awards for Co-Founders In April 2023, the compensation committee recommended to the independent members of our Board of Directors that RSU awards be granted to our Co-Founders after considering the factors described in “Compensation-Setting Process – Setting Target Total Direct Compensation” above, as well as the outstanding equity holdings of each of named executive officer, the projected impact of the proposed awards on our earnings, our burn rate in relation to the median proportions of the companies in our compensation peer group, and the potential voting power dilution to our stockholders in relation to the median practice of the companies in our compensation peer group. The RSU awards granted to our Co-Founders had target values of $18 million each, with the number of units to be determined based on the average NET closing market price of our Class A common stock for the trailing 30-trading day period ending on April 18, 2023. On April 19, 2023, the independent members of our Board of Directors approved the grant of RSU awards to our Co-Founders as follows:

  22. Compensation Elements

    | Named Executive Officer | RSU Award (target value) ($) | RSU Award (number of units) (#)(1) | | Matthew Prince | 18,000,000 | 307,482 | | Michelle Zatlyn | 18,000,000 | 307,482 |

  23. Compensation Elements

    _______________________ (1)For information regarding how the aggregate grant date fair value of the RSU awards was calculated, see footnote 1 to the "2023 Summary Compensation Table" below. The RSU awards granted to our Co-Founders vest in 16 equal quarterly installments over a four-year period following the vesting start date, with the first vesting date on May 15, 2023, subject to Mr. Prince’s and Ms. Zatlyn’s continued service to us through the applicable vesting dates. In addition, each RSU award is subject to the “double-trigger” acceleration of vesting provisions applicable to our Co-Founders pursuant to the terms of their participation in the Severance Policy. Each unit represents a right to receive one share of our Class A common stock for each unit that vests. Amendment to Outstanding Performance Stock Options In February 2022, Messrs. Seifert and Kramer were granted Performance Options to purchase 555,000 and 330,000 shares of our Class A common stock, respectively, that were to vest and become exercisable only if we achieved certain stock price milestones and each of Messrs. Seifert and Kramer continued to provide service to us through the determination of the achievement of certain pre-established stock price milestones and through certain additional time-based vesting requirements. The Performance Options are described in more detail in “Compensation Discussion and Analysis – Compensation Elements — Long-Term Incentive Compensation – Equity Awards for Messrs. Seifert and Kramer” in our definitive proxy statement filed with the SEC on April 20, 2023. In April 2023, the compensation committee and our Board of Directors, upon the recommendation of our Co-Founders, revisited the Performance Options and, after noting the stock price milestones of the Performance Options compared to our then-current stock price and the resulting lack of retentive value of such awards, concluded that, as then-currently structured, the Performance Options no longer would fully meet the critical retention and long-term stockholder value creation objectives that they were granted to achieve. Specifically, the market conditions during 2022 and early 2023, combined with the decline in the market price of our Class A common stock since the grant of the Performance Options resulted in materially “out-of-the-money” options with stock price performance goals that failed to reward our key members of management for what would, at our then-current stock price, be significant increases to our stock value. Accordingly, our Co-Founders recommended to the compensation committee that it consider possible amendments to the Performance Options. Our CEO informed the compensation committee that certain members of our management team had met with certain of our stockholders regarding the proposed amendments as well as analyzed the impact of the proposed amendments on our equity burn rate. During its discussions, the compensation committee noted that, in addition to driving high growth stock price performance, the Performance Options were intended to provide continued incentives for driving innovation over the long-term, serve as a catalyst for the achievement of our long-term strategic and financial objectives, and incentivize the continued attention and involvement of the key members of management in the company over the long-term despite other opportunities. After extensive discussion, including a review of the cost impact to us of the proposed amendments and the financial reporting consequences of such action, the compensation committee determined to recommend to our Board of Directors that, to reinvigorate the Performance Options as a catalyst for the achievement of our long-term strategic and financial objectives and the continued deep attention and involvement of Messrs. Seifert and Kramer, as key leaders in the company, over the long-term despite other opportunities and to strengthen their incentive and retention impact, the Performance Options be amended to (i) modify the exercise price per share of each Performance Option to the fair market value per share of our Class A common stock on the effective date of the amendment, which was May 1, 2023 (which fair market value was the closing market price of a share of our Class A common stock on such date), (ii) add three lower stock price hurdles at $72.00, $93.00, and $120.00 per share, and (iii) remove the top two stock price hurdles of $753.00 and $979.00 per share. In addition, the allocation of shares earned per stock price milestone was to be adjusted accordingly. In April 2023, our Board of Directors approved amendments to the Performance Options, effective as of May 1, 2023. These amendments reduced the exercise price per share of the performance options to $44.72, which was the closing price of our Class A common stock, as reported by the NYSE, on May 1, 2023 (the effective date of the amendments), and modified the structure of the Performance Options to contain a total of nine separate tranches with updated Stock Price Targets (as defined in the award agreements for the Performance Options) to reward incremental, but significant, increases in our stock value, as shown in the table below:

  24. Compensation Elements

    Under the Performance Options both as originally approved in 2022 and as amended in 2023, if none of the Stock Price Targets are achieved, no shares subject to the Performance Options will be earned and vest. To satisfy a Stock Price Target, the volume weighted average closing market price over a rolling 90 calendar day period (following the grant date) must equal or exceed the Stock Price Target, except that in the event of a change in control of the company, achievement of a Stock Price Target instead will be measured against the change in control price per share of Class A common stock. The shares subject to tranches 1 and 2 became eligible for time-based vesting, described below, on January 23, 2024 and April 16, 2024, respectively, when the compensation committee certified the achievement of the applicable tranche's related Stock Price Targets of $72.00 for tranche 1 and $93.00 for tranche 2. In the event that either Messrs. Seifert's or Kramer's continued service with the company ends due to death or disability, his Performance Option can remain outstanding and eligible to vest based on the achievement of stock price targets for up to 18 months following the termination date of his service. In addition to achievement of the applicable Stock Price Target, each tranche of the Performance Options is subject to additional, time-based vesting requirements, under which 1/6th of the shares of Class A common stock subject to the applicable tranche vests and becomes exercisable on each of the following quarterly vesting dates (February 15th, May 15th, August 15th, and November 15th) occurring on or after the date of certification of achievement of the applicable Stock Price Target for such tranche, subject to Messrs. Seifert's and Kramer's, as applicable, continued status as a service provider to us through each vesting date. The time-based vesting requirements are waived upon a change in control of the company. The Performance Options are excluded from the application of acceleration of vesting provisions that otherwise would apply to Messrs. Seifert's and Kramer's equity awards under the terms of their participation in the Severance Policy. The equity awards granted to our named executive officers during 2023 are set forth in the “2023 Summary Compensation Table” and the “2023 Grants of Plan-Based Awards Table” below. Retirement, Health, and Welfare Benefits Our named executive officers are eligible to receive the same employee benefits that are generally available to all employees, subject to the satisfaction of certain eligibility requirements, including participation in retirement, health, and welfare plans. These benefits include medical, dental, and vision insurance, business travel insurance, an employee assistance program, health and dependent care flexible spending accounts, basic life insurance, accidental death and dismemberment insurance, and short-term and long-term disability insurance. We maintain a tax-qualified Section 401(k) retirement plan for all U.S. employees who satisfy certain eligibility requirements, including requirements relating to age and length of service. Under our Section 401(k) plan, employees may elect to defer up to all eligible compensation, subject to applicable annual Internal Revenue Code (the Code) limits. We intend for our Section 401(k) plan to qualify under Sections 401(a) and 501(a) of the Code so that contributions by employees to our Section 401(k) plan, and income earned on those contributions, are not taxable to employees until withdrawn from our Section 401(k) plan. The Section 401(k) plan also permits contributions to be made on a post-tax basis subject to applicable annual Code limits. We have not made any matching contributions to the Section 401(k) plan to date. We design our employee benefits programs to be affordable and competitive in relation to the market as well as compliant with applicable laws and practices. We adjust our employee benefits programs as needed based upon regular monitoring of applicable laws and practices and the competitive market. Perquisites and Other Personal Benefits Personal benefits currently are not a material component of our executive compensation program. Accordingly, we do not provide significant perquisites or other personal benefits to our named executive officers, except as generally made available to our employees or in situations where we believe it is appropriate to serve a legitimate business purpose (such as the security of our Co-Founders), including to assist an individual in the performance of his or her duties or to make him or her more efficient and effective, or to recruit or retain him or her. Our Board of Directors and compensation committee have approved an Air Travel Security Policy, which generally requires each of our Co-Founders to use private aircraft for all business and personal travel. Our Board of Directors and compensation committee approved this policy because they believe that the personal safety and security of our Co-Founders are of utmost importance to us and our stockholders. We believe that amounts paid by us pursuant to the Air Travel Security Policy are reasonable, necessary, appropriate, and for the benefit of us and our stockholders. Under our Air Travel Security Policy, our Co-Founders generally may not travel on the same flight, no more than five employees who are Senior Vice Presidents or above may travel on the same aircraft, and no more than two non-employee members of our Board of Directors may travel on the same aircraft. If family members and other guests of our Co-Founders (including any other company employees) travel on the private aircraft, the Co-Founder is required to notify the appropriate departments at our company so that the appropriate compensation amount is included in such Co-Founder’s compensation income. Any income or other tax liability arising from this income will not be reimbursed or “grossed up” by the company. During 2023, none of our named executive officers (except our Co-Founders) received perquisites or other personal benefits that were, in the aggregate, $10,000 or more for any individual. We have in the past and may in the future provide perquisites or other personal benefits in circumstances in which we think it serves a legitimate business purpose to do so, including but not limited to those described in the preceding paragraph. All future practices with respect to perquisites or other personal benefits generally will be approved and subject to periodic review by the compensation committee and our Board of Directors.

  25. Employment Agreements and Post-Employment Compensation

    Employment Agreements and Post-Employment Compensation We have entered into written confirmatory employment agreements with our CEO, President, and our other named executive officers. Each of these agreements provides for “at-will” employment and sets forth the title and position of the named executive officer, including base salary as then in effect, participation in our employee benefit programs, eligibility for future equity awards, and the opportunity to participate in the Severance Policy or other severance benefit program. All of our named executive officers participate in the Severance Policy, which provides them with certain protection in the event of their termination of employment by us other than for “cause,” death, or “disability” (as such terms are defined in their participation agreement to the Severance Policy), including in the event of certain terminations of employment in connection with a change in control of the company. These arrangements provide reasonable compensation to a named executive officer if he or she leaves our employ under certain circumstances to facilitate his or her transition to new employment. Further, in some instances we seek to mitigate any potential employer liability and avoid future disputes or litigation by requiring a departing named executive officer to sign a separation agreement and release of claims acceptable to us as a condition to receiving post-employment compensation payments or benefits. We also believe that the Severance Policy helps maintain their continued focus and dedication to their assigned duties to maximize stockholder value if there is a potential transaction that could involve a change in control of the company. Under the Severance Policy, all payments and benefits in the event of a change in control of the company are payable only if there is a subsequent loss of employment by a named executive officer (a so-called “double-trigger” arrangement). In the case of the acceleration of vesting of outstanding equity awards, we use this double-trigger arrangement to protect against the loss of retention value following a change in control of the company and to avoid windfalls, both of which could occur if vesting of either equity or cash-based awards accelerated automatically as a result of a change in control transaction. Prior to the adoption of the Severance Policy in August 2019, we did not have a formal plan with respect to severance benefits payable to our named executive officers and other key employees. From time to time, we granted equity awards to certain key employees, including our named executive officers, which provided for accelerated vesting of equity awards under certain circumstances following a change in control of the company, as described further under the section titled “Potential Payments upon Termination or Change in Control” below. Similar to the Severance Policy provisions triggered upon certain terminations of employment following a change in control, these double trigger provisions help protect against the loss of retention value following a change in control of the company. Any double trigger provisions applicable to equity awards granted before the adoption of the Severance Policy remain in place and were not impacted by the adoption of the Severance Policy. The Performance Options granted to Messrs. Seifert and Kramer are specifically excluded from coverage under the terms of the Severance Policy. Under the terms of these awards, a termination of employment will not result in the acceleration of vesting, except that the time-based vesting requirements are waived upon a change in control. These provisions foster retention before a change in control, incentivize performance before and in connection with a change in control, and encourage the recipients to maximize the value for our stockholders in a change in control transaction without losing focus or energy due to concern about their post-transaction employment. We believe that having in place reasonable and competitive post-employment compensation arrangements, including in the event of a change in control of the company, are essential to attracting and retaining highly qualified executive officers. For detailed descriptions of the post-employment compensation arrangements with our named executive officers, as well as an estimate of the potential payments and benefits payable under these arrangements, see “Potential Payments upon Termination or Change in Control” below.

  26. Other Compensation Policies

    Other Compensation Policies Stock Ownership Guidelines We maintain stock ownership guidelines to help ensure that our Co-Founders, all Senior Vice Presidents and above (which includes all executive officers who are subject to Section 16 of the Exchange Act) (our covered executives), and the non-employee members of our Board of Directors maintain an equity stake in the company and, by doing so, appropriately link their interests with the interests of our stockholders. The guideline for our Co-Founders requires them to own and hold shares of our Class A common stock and/or Class B common stock with an aggregate value equal to at least five times his or her then-current annual base salary and our other covered executives (including our other named executive officers) to own and hold shares of our Class A common stock and/or Class B common stock with an aggregate value equal to at least one times his or her then-current annual base salary. The guideline for the non-employee members of our Board of Directors requires each director to own and hold shares of our Class A common stock and/or Class B common stock with an aggregate value equal of at least three times his or her annual cash retainer for service on our Board of Directors. Each incumbent covered executive at the time we adopted these guidelines is required to achieve this accumulated value requirement by the last trading day of 2026 and to maintain such requirement thereafter throughout his or her service as a covered executive subject to these guidelines, while the then-incumbent non-employee members of our Board of Directors are expected to achieve their accumulated value requirement by the last trading day of 2026. New covered executives who are subject to these guidelines and new non-employee directors are required to achieve their accumulated value requirement by the last trading day after the completion of five full calendar years from the date that the person assumes his or her position or joins our Board of Directors, as the case may be. As of December 31, 2023, all of our named executive officers and non-employee members of our Board of Directors had met or were on track to comply with these stock ownership guidelines within the applicable time periods. Hedging and Pledging Prohibitions Under our insider trading policy, absent a waiver from our CLO or our CFO, our employees (including our named executive officers) and the non-employee members of our Board of Directors are prohibited from engaging in short sales, trading in derivative securities (other than stock options, RSU awards, and other compensatory awards issued to such individuals by us) or engaging in hedging transactions, pledging our securities as collateral for a loan, and holding our securities in a margin account. Compensation Recovery (“Clawback”) Policy In October 2023, the compensation committee adopted a compensation recovery (“clawback”) policy designed to comply with, and will be interpreted in a manner consistent with, Section 10D of the Exchange Act and the applicable listing standards of the NYSE (the clawback policy). This policy applies to all of our current and former executive officers. The clawback policy provides that, subject to the limited exemptions provided by the NYSE listing standards, if the company is required to restate its financial results due to material noncompliance with financial reporting requirements under the securities laws, the company must reasonably promptly seek recovery of any cash-based or equity-based incentive compensation (including vested and unvested equity) paid or awarded to the executive officer, to the extent that the compensation (i) was based on a financial reporting measure and (ii) exceeded what would have been paid to the executive officer under the restatement. Recovery applies to any such excess cash- or equity-based incentive compensation received by any covered executive officer, after the effective date of the clawback policy and while he/she was an executive officer, during the three completed fiscal years immediately preceding the date on which our Board of Directors, authorized committee, or officer concludes (or reasonably should have concluded) we are required, or a court, regulator, other legally authorized body requires us, to prepare the restatement. For more information, see the full text of our clawback policy, which is filed as Exhibit 97.1 to our 2023 Annual Report filed with the SEC on February 21, 2024.

  27. Tax and Accounting Considerations

    Tax and Accounting Considerations The compensation committee takes the applicable tax and accounting requirements into consideration in designing and overseeing our executive compensation program. Deductibility of Executive Compensation Generally, Section 162(m) of the Code limits the amount we may deduct from our federal income taxes for compensation paid to our CEO and certain other current or former executive officers who are “covered employees” within the meaning of Section 162(m) of the Code to $1 million per year, per individual, subject to certain exceptions. The compensation committee has not adopted a policy that all equity or other compensation paid to our covered employees must be deductible. In approving the amount and form of compensation for our named executive officers in the future, the compensation committee generally considers all elements of the cost to us of providing such compensation, including the potential impact of Section 162(m) of the Code, as well as our need to maintain flexibility in compensating executive officers in a manner designed to promote our goals. The compensation committee may, in its judgment, authorize compensation payments that will or may not be deductible when it believes that such payments are appropriate to attract, retain, or motivate executive talent. Accounting for Stock-Based Compensation The compensation committee takes accounting considerations into account in designing compensation plans and arrangements for our executive officers and other employees. Chief among these is Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation — Stock Compensation (ASC Topic 718), the standard which governs the accounting treatment of certain stock-based compensation. Among other things, ASC Topic 718 requires us to record a compensation expense in our income statement for all equity awards granted to our executive officers and other employees. This compensation expense is based on the grant date “fair value” of the equity award and, in most cases, will be recognized ratably over the award’s requisite service period (which, generally, will correspond to the award’s vesting schedule). This compensation expense is also reported in the compensation tables below, even though recipients may never realize any value from their equity awards.

  28. 2023 Summary Compensation Table

    2023 Summary Compensation Table The following table provides information regarding the compensation of our named executive officers during the years ended December 31, 2023, 2022, and 2021.

  29. 2023 Summary Compensation Table

    | Name and Principal Position | Year | Salary ($) | Stock Awards ($)(1) | Option Awards ($) | All Other Compensation ($) | Total ($) | | Matthew Prince | 2023 | 400,000 | 19,331,393 | — | 783,957(2) | 20,515,350 | | Chief Executive Officer | 2022 | 400,000 | — | — | 199,731(2) | 599,731 | | | 2021 | 400,000 | — | — | — | 400,000 | | Michelle Zatlyn | 2023 | 400,000 | 19,331,393 | — | 327,456(2) | 20,058,849 | | President and Chief Operating Officer | 2022 | 400,000 | — | — | 1,047,900(2) | 1,447,900 | | | 2021 | 400,000 | — | — | — | 400,000 | | Thomas Seifert | 2023 | 650,000 | 12,887,596 | 3,579,519(3) | — | 17,117,115 | | Chief Financial Officer | 2022 | 650,000 | 3,620,445 | 32,659,669(4) | — | 36,930,114 | | | 2021 | 650,000 | 4,191,537 | — | — | 4,841,537 | | Douglas Kramer | 2023 | 550,000 | 6,443,798 | 2,128,363(3) | — | 9,122,161 | | Chief Legal Officer and Secretary | 2022 | 550,000 | 2,262,765 | 19,419,263(4) | — | 22,232,028 | | | 2021 | 550,000 | 2,619,669 | — | — | 3,169,669 |

  30. 2023 Summary Compensation Table

    ______________________ (1)The amounts reported represent the aggregate grant date fair value of the RSUs awarded under the 2019 Plan to certain of our named executive officers, calculated in accordance with FASB ASC Topic 718. Such grant date fair value does not take into account any estimated forfeitures related to service-based vesting conditions for these awards. The assumptions used in calculating the grant date fair value of the RSUs reported in this column are set forth in the Notes to our Consolidated Financial Statements included in our 2023 Annual Report. These amounts do not necessarily correspond to the actual value recognized or that may be recognized by the executive officers. (2)The amounts reported represents the aggregate incremental cost to us for the personal use of our leased corporate aircraft by Mr. Prince and Ms. Zatlyn. For security reasons, the Board of Directors generally requires Mr. Prince and Ms. Zatlyn to use private aircraft for business and personal travel. We determine the incremental cost based on the invoiced amount from our third-party provider for the variable costs incurred on each trip, consisting of the applicable hourly rate plus fuel and ancillary charges. Since our leased aircraft is used primarily for business travel, the aggregate incremental cost does not include certain fixed costs that do not change based on usage, such as monthly lease expenses. From time to time, certain family members or other guests will accompany Mr. Prince or Ms. Zatlyn on personal trips when using our aircraft, typically at little or no incremental cost to us. In addition, the amounts reported in 2022 reflect that a guest of Mr. Prince used our aircraft for personal travel during a single trip at an incremental cost of $12,607 and a guest of Ms. Zatlyn used our aircraft for personal travel during a single trip at an incremental cost of $283,405. (3)The amounts reported in 2023 reflect the incremental grant date fair value of the performance-based stock options, calculated in accordance with FASB ASC Topic 718, associated with the amendments to such options that became effective May 1, 2023. The assumptions used in calculating the incremental grant date fair value reported are set forth in the Notes to our Consolidated Financial Statements included in our 2023 Annual Report. These amounts do not necessarily correspond to the actual value recognized or that may be recognized by the executive officers. For more information regarding the amendments to the performance-based stock options, see the section titled “Compensation Discussion and Analysis – Compensation Elements – Amendment to Outstanding Performance Stock Options.” (4)The amounts reported represent the aggregate grant date fair value of the performance-based stock options awarded under the 2019 Plan to certain of our named executive officers, calculated in accordance with FASB ASC Topic 718. Such grant date fair value does not take into account any estimated forfeitures related to performance or service-based vesting conditions for these awards. The assumptions used in calculating the grant date fair value of the performance-based stock options reported are set forth in the Notes to our Consolidated Financial Statements included in our Annual Report on Form 10-K filed with the SEC on February 24, 2023 (our 2022 Annual Report). These amounts do not necessarily correspond to the actual value recognized or that may be recognized by the executive officers. For the grants made to Messrs. Seifert and Kramer, the accounting grant date for the performance-based stock options was April 20, 2022, which was the date that the options were amended by the Board of Directors to remove the provision that the options would automatically forfeit if the performance-based options granted to the Co-Founders were not approved by the disinterested stockholders.

  31. Grants of Plan Based Awards in 2023

    Grants of Plan Based Awards in 2023 The following table summarizes all plan-based awards granted to our named executive officers during the fiscal year ended December 31, 2023.

  32. Grants of Plan Based Awards in 2023

    | Name | Grant Date(1) | Estimated Future Payouts Under Equity Incentive Plan Awards (#) | | | All Other Stock Awards: Number of Shares of Stock or Units (#)(2) | All Other Option Awards: Number of Securities Underlying Options (#)(3) | Exercise or Base Price of Option Awards ($/share) | Grant Date Fair Value of Stock and Option Awards ($) | | | | Threshold | Target | Maximum | | | | | | Matthew Prince | 4/19/2023 | — | — | — | 307,482 | — | — | 19,331,393(4) | | Michelle Zatlyn | 4/19/2023 | — | — | — | 307,482 | — | — | 19,331,393(4) | | Thomas Seifert | 4/19/2023 | — | — | — | 204,988 | — | — | 12,887,596(4) | | | 5/1/2023 | — | — | — | — | 555,000 | 44.72 | 3,579,519(5) | | Douglas Kramer | 4/19/2023 | — | — | — | 102,494 | — | — | 6,443,798(4) | | | 5/1/2023 | — | — | — | — | 330,000 | 44.72 | 2,128,363(5) |

  33. Grants of Plan Based Awards in 2023

    _______________________ (1)Dates reported represent the grant date, or in the case of modified awards, the modification date. (2)Shares reported represent awards of RSUs granted under the 2019 Plan. Each award of RSUs is subject to service-based vesting criteria described in the footnotes to the table below titled “Outstanding Equity Awards at Fiscal 2023 Year End,” except as otherwise indicated in the footnotes to this table. (3)Shares reported represent performance-based stock options granted under the 2019 Plan (each, a Performance Option). Each Performance Option was originally granted by the Board of Directors on February 14, 2022 and was subsequently amended on May 1, 2023. Each Performance Option is subject to performance and service-based vesting criteria described in the footnotes to the table below titled “Outstanding Equity Awards at Fiscal 2023 Year End.” (4)The amounts reported represent the aggregate grant date fair value of the RSUs awarded under the 2019 Plan to certain of our named executive officers, calculated in accordance with FASB ASC Topic 718. Such grant date fair value does not take into account any estimated forfeitures related to service-based vesting conditions for these awards. The assumptions used in calculating the grant date fair value of the RSUs reported are set forth in the Notes to our Consolidated Financial Statements included in our 2023 Annual Report. These amounts do not necessarily correspond to the actual value recognized or that may be recognized by the executive officers. (5)The amounts reported represent the incremental grant date fair values of the performance-based stock options granted to Messrs. Seifert and Kramer, calculated in accordance with FASB ASC Topic 718, associated with the amendments to such options that became effective May 1, 2023. The assumptions used in calculating the incremental grant date fair value reported are set forth in the Notes to our Consolidated Financial Statements included in our 2023 Annual Report. The total fair value, calculated in accordance with FASB ASC Topic 718, of such options to Messrs. Seifert and Kramer, inclusive of the incremental fair value, is $36,239,188 and $21,547,625, respectively. These amounts do not necessarily correspond to the actual value recognized or that may be recognized by the executive officers. Such grant date fair values do not take into account any estimated forfeitures related to performance or service-based vesting conditions for these awards.

  34. Outstanding Equity Awards at Fiscal 2023 Year-End

    Outstanding Equity Awards at Fiscal 2023 Year-End The following table sets forth information regarding outstanding equity awards held by our named executive officers as of December 31, 2023.

  35. Outstanding Equity Awards at Fiscal 2023 Year-End

    | | Option Awards | | | | | | Stock Awards | | | Name | Grant Date | Number of Securities Underlying Unexercised Options | | | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested($)(1) | | | | Exercisable (#) | Unexercisable (#) | Unearned (#) | | | | | | Matthew Prince | 4/19/2023 | — | — | — | — | — | 249,830(2) | 20,800,846 | | Michelle Zatlyn | 8/8/2017 | 3,599,988(3) | — | — | 2.04 | 8/7/2027 | — | — | | | 4/19/2023 | — | — | — | — | — | 249,830(2) | 20,800,846 | | Thomas Seifert | 7/26/2017 | 725,341(3) | — | — | 2.04 | 7/25/2027 | — | — | | | 2/3/2021 | — | — | — | — | — | 15,674(4) | 1,305,017 | | | 2/2/2022 | — | — | — | — | — | 36,277(5) | 3,020,423 | | | 2/14/2022 | — | — | 550,000(6) | 44.72 | 2/13/2032 | — | — | | | 4/19/2023 | — | — | — | — | — | 170,824(7) | 14,222,806 | | Douglas Kramer | 7/26/2017 | 108,500(3) | — | — | 2.04 | 7/25/2027 | — | — | | | 2/3/2021 | — | — | — | — | — | 9,796(4) | 815,615 | | | 2/2/2022 | — | — | — | — | — | 22,673(5) | 1,887,754 | | | 2/14/2022 | — | — | 330,000(6) | 44.72 | 2/13/2032 | — | — | | | 4/19/2023 | — | — | — | — | — | 85,412(7) | 7,111,403 |

  36. Outstanding Equity Awards at Fiscal 2023 Year-End

    _______________________ (1)The market value was calculated using the closing market price of a share of our Class A common stock as of December 29, 2023, which was $83.26. (2)The shares of Class A common stock underlying these RSUs vest in 16 quarterly installments following February 15, 2023, subject to continued service to us through each such date. This award is subject to vesting acceleration under certain circumstances pursuant to the terms of the named executive officer's participation in the Severance Policy, as described in the section titled "Potential Payments upon Termination or Change in Control" below. (3)The options were granted pursuant to our Amended and Restated 2010 Equity Incentive Plan (the 2010 Plan) and are immediately exercisable, except as otherwise noted below. As of December 31, 2023, the shares of Class B common stock underlying this stock option are fully vested. (4)The shares of Class A common stock underlying these RSUs vested as to 1/2 of the total shares on February 15, 2023 and the remaining shares vest in 8 quarterly installments thereafter, subject to continued service to us through each such date. This award is subject to vesting acceleration under certain circumstances pursuant to the terms of the named executive officer's participation in the Severance Policy, as described in the section titled "Potential Payments upon Termination or Change in Control" below. (5)The shares of Class A common stock underlying these RSUs vested as to 1/2 of the total shares on February 15, 2024 and the remaining shares vest in 8 quarterly installments thereafter, subject to continued service to us through each such date. This award is subject to vesting acceleration under certain circumstances pursuant to the terms of the named executive officer's participation in the Severance Policy, as described in the section titled "Potential Payments upon Termination or Change in Control" below. (6)The options were granted pursuant to our 2019 Plan and are 10-year performance-based options to purchase shares of our Class A common stock that vest and become exercisable only if we achieve certain stock price milestones, and are also subject to additional service-based vesting requirements under which 1/6th of the shares of Class A common stock subject to the applicable tranche vests and becomes exercisable on each of the following quarterly vesting dates (February 15th, May 15th, August 15th, and November 15th) occurring on or after the date of certification of achievement of the applicable stock price milestone for such tranche, subject to continued service to us through each such date. The time-based vesting requirements are waived upon a change in control of the company. As of the date of this Proxy Statement, we have met the stock price milestones for the first two tranches, and therefore, the performance condition was satisfied for the first two tranches for each of Messrs. Seifert and Kramer's Performance Options. These Performance Options were amended on May 1, 2023, as described in more detail in the section titled "Compensation Elements – Long-Term Incentive Compensation — Amendment of Outstanding Performance Stock Options" above. (7)The shares of Class A common stock underlying these RSUs vest in 12 quarterly installments following May 15, 2023, subject to continued service to us through each such date. This award is subject to vesting acceleration under certain circumstances pursuant to the terms of the named executive officer's participation in the Severance Policy, as described in the section titled "Potential Payments upon Termination or Change in Control" below.

  37. Option Exercises and Stock Vested in 2023

    Option Exercises and Stock Vested in 2023 The following table presents, for each of the named executive officers, the number of shares of our common stock acquired upon the exercise of stock options and the vesting and settlement of RSUs during 2023 and the aggregate value realized upon the exercise of stock options and the vesting and settlement of RSUs.

  38. Option Exercises and Stock Vested in 2023

    | | Option Awards | | Stock Awards | | | Name | Number of Shares Acquired on Exercise (#) | Value Realized on Exercise ($)(1) | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($)(2) | | Matthew Prince | — | — | 57,652 | 3,538,488 | | Michelle Zatlyn | 276,928 | 17,515,593 | 57,652 | 3,538,488 | | Thomas Seifert | 485,000 | 29,804,726 | 68,646 | 4,663,383 | | Douglas Kramer | 44,000 | 2,670,115 | 73,008 | 4,824,401 |

  39. Option Exercises and Stock Vested in 2023

    _______________________ (1)The aggregate value realized is calculated by multiplying (i) the number of shares of common stock acquired upon exercise by (ii) the difference between the closing price of our Class A common stock on the date of exercise, as reported by the NYSE, and the applicable exercise price of the option, and does not represent actual amounts received by our named executive officers as a result of the option exercises. (2)The aggregate value realized is calculated by multiplying (i) the number of shares of common stock acquired upon vesting of RSUs by (ii) the closing price of our Class A common stock on the vest date (or, in the event the vest date occurs on a holiday or weekend, the closing price of our Class A common stock on the immediately preceding trading day), as reported by the NYSE.

  40. Potential Payments upon Termination or Change in Control

    Potential Payments upon Termination or Change in Control Prior to August 2019, we did not have a formal plan with respect to severance benefits payable to our named executive officers and other key employees. From time to time, we granted equity awards to certain key employees, including our named executive officers, that provided for accelerated vesting of equity awards under certain circumstances. Specifically, the vesting of each equity award granted to our named executive officers before the effectiveness of the Severance Policy (as described below) (each, a Pre-Severance Policy Equity Agreement) will accelerate in full if, in connection with or following a “change in control” (as defined in the 2010 Plan), the named executive officer’s continuous service with us is terminated by us without “cause” (as defined in the 2010 Plan) or by the named executive officer due to “constructive termination” (as defined in the applicable equity award agreement). As of December 31, 2023, our named executive officers no longer have any unvested equity awards subject to a Pre-Severance Policy Equity Agreement. In August 2019, our Board of Directors approved change in control and severance benefits for our current named executive officers and certain other key employees (collectively, participants) pursuant to the Severance Policy. The Severance Policy provides that if we terminate a named executive officer’s employment outside of the period beginning three months prior to and ending 12 months after a “change in control” (as defined in the Severance Policy) (such period, the change in control period) other than for “cause” (as generally defined within the named executive officer’s participation agreement), and other than due to death or disability, the named executive officer will receive: •a lump sum payment equal to six months of base salary; and •a lump sum payment equal to 12 months of COBRA continuation coverage premiums. The following table describes the potential payments that would have been provided to each of our named executive officers pursuant to the Severance Policy in the event that they were involuntarily terminated as described above outside of a change in control period, assuming such termination occurred on December 31, 2023.

  41. Potential Payments upon Termination or Change in Control

    | Named Executive Officer | Cash Compensation($) | Health Benefits($) | Total($) | | Matthew Prince | 200,000 | 24,782 | 224,782 | | Michelle Zatlyn | 200,000 | 24,782 | 224,782 | | Thomas Seifert | 325,000 | 21,065 | 346,065 | | Douglas Kramer | 275,000 | 24,782 | 299,782 |

  42. Potential Payments upon Termination or Change in Control

    The Severance Policy also provides that if a named executive officer’s employment is terminated during the change in control period either by us other than for cause, and other than due to death or disability, or by the named executive officer due to a “constructive termination” (as generally defined within the executive officer’s participation agreement), the named executive officer will receive: •a lump sum payment equal to 12 months of base salary; •a lump sum equal to a prorated target annual bonus for the year of termination; •100% acceleration of unvested time-based equity awards granted on or after the effective date of the Severance Policy (the terms of the Performance Options specify that such grants will not be considered time-based equity awards for purposes of the Severance Policy and therefore will not be subject to the acceleration of vesting provisions of the Severance Policy); and •a lump sum payment equal to 12 months of COBRA continuation coverage premiums. In addition, our equity incentive plans contain certain provisions related to a change in control that could impact awards held by our named executive officers. Our 2019 Plan provides that in the event of a merger or “change in control,” as defined under the 2019 Plan, each outstanding award will be treated as the administrator determines, except that if a successor corporation does not continue an outstanding award (or some portion of such award), then such award will fully vest, all restrictions on such award will lapse, all performance goals or other vesting criteria applicable to such award will be deemed achieved at 100% of target levels, and such award will become fully exercisable, if applicable, for a specified period prior to the transaction. The award will then terminate upon the expiration of the specified period of time. However, the Performance Options granted to Messrs. Seifert and Kramer will not accelerate if not assumed or substituted for by a successor corporation. Instead, the time-based vesting requirement is waived in the event of a change in control (with the performance-based requirements measured pursuant to the award terms), and any shares subject to the Performance Options that have not vested as of immediately prior to a change in control will be forfeited as of immediately prior to the change in control and will not be eligible for any vesting as a result of the change in control. Our 2010 Plan provides that, in the event of certain specified significant corporate transactions, each outstanding award will be treated as the administrator determines, unless otherwise provided in an award agreement or other written agreement between us and the award holder. Unless otherwise provided in an award agreement, if a 2010 Plan award is not assumed, continued or substituted for, the award will not vest and will terminate prior to the effective time of the transaction, but for awards held by individuals who have not terminated service with us prior to the corporate transaction, any reacquisition or repurchase rights held by us will lapse, contingent on the effectiveness of such transaction. The following table describes the potential payments that would have been provided to each of our named executive officers in the event that, during a change in control period or, with respect to the equity acceleration, in connection with or following a change in control, they were involuntarily terminated as described above, assuming such termination occurred on December 31, 2023.

  43. Potential Payments upon Termination or Change in Control

    | Named Executive Officer | Cash Compensation($) | Health Benefits($) | Equity Acceleration($)(1) | Total($) | | Matthew Prince | 400,000 | 24,782 | 20,800,846 | 21,225,628 | | Michelle Zatlyn | 400,000 | 24,782 | 20,800,846 | 21,225,628 | | Thomas Seifert | 650,000 | 21,065 | 18,548,247 | 19,219,312 | | Douglas Kramer | 550,000 | 24,782 | 9,814,772 | 10,389,554 |

  44. Potential Payments upon Termination or Change in Control

    ______________________ (1)For each named executive officer, the estimated benefit amount of unvested RSUs was calculated by multiplying the number of unvested RSUs by the closing price of our Class A common stock on December 29, 2023, which was $83.26. The Severance Policy provides that if we discover after a participant’s receipt of payments or benefits under the Severance Policy that grounds for the termination of the participant’s employment for cause existed, then the participant will not receive any further payments or benefits under the Severance Policy and, to the extent permitted under applicable laws, will be required to repay to us any payments or benefits he or she received under the Severance Policy (and any financial gain derived from such payments or benefits). In addition, the Severance Policy provides that if any payments or benefits received by a participant under the Severance Policy or otherwise would constitute “parachute payments” within the meaning of Section 280G of the Internal Revenue Code (the Code) and be subject to excise taxes imposed by Section 4999 of the Code, such amount will either be delivered in full or reduced so as not to be subject to excise taxation, whichever amount results in a greater amount received by the participant on an after-tax basis. The Severance Policy does not require us to provide any tax gross-ups. To receive the severance described above under the Severance Policy, the participant must sign and not revoke our then-standard separation agreement and release of claims within the timeframe that is set forth in the Severance Policy.

  45. CEO Pay Ratio Disclosure

    CEO Pay Ratio Disclosure As required by SEC rules, we are providing the following information about the ratio of the total annual compensation of our "median employee" to the total annual compensation of our CEO (the CEO Pay Ratio). For fiscal 2023, the total compensation of our CEO was $20,515,350 and the total compensation of our median employee was $215,999. Accordingly, the CEO Pay Ratio for fiscal 2023 is approximately 95:1. This ratio is a reasonable estimate calculated in a manner consistent with SEC rules. For fiscal 2023, we calculated the CEO pay ratio using the same median employee that we used to calculate the pay ratio in fiscal 2022 and fiscal 2021, as we believe there has been no significant change in our employee population or compensation arrangements during fiscal 2023 that would result in a significant change to our pay ratio disclosure. In order to identify our median employee in fiscal 2021, we examined the compensation in 2021 of all our employees globally, including those employed on a full-time, part-time, seasonal or temporary basis by the company as of December 31, 2021, excluding our CEO. For employees paid other than in U.S. dollars, we converted their compensation into U.S. dollars using foreign currency exchange rates in effect as of December 31, 2021. We did not make any cost-of-living adjustments for employees outside the United States. We annualized compensation for employees who were not employed by us for the entire 2021 fiscal year. We used a consistently applied compensation measure consisting of annual base salary and sales commissions paid, if applicable, to identify our median employee for fiscal 2021, with such information based on our payroll records. We believe our methodology represents a consistently applied compensation measure because it reasonably reflects annual compensation to our employees, striking a balance in terms of administrative burden while consistently treating all the primary compensation components for our worldwide workforce and capturing a full year of each of such primary compensation components. We calculated our median employee’s fiscal 2023 annual total compensation using the same methodology that we use for our named executive officers as set forth in the “2023 Summary Compensation Table” above. With respect to the annual total compensation of our CEO, we used the amount reported in the “Total” column of the “2023 Summary Compensation Table” above. In selecting the median employee in accordance with Item 402 of Regulation S-K under the Securities Act, reporting companies are permitted to use reasonable estimates, assumptions, and methodologies based on their own facts and circumstances. As a result, the disclosure regarding the compensation of our median employee and the CEO Pay Ratio may not be directly comparable to similar disclosure by other reporting companies.

  46. Pay Versus Performance Disclosure

    Pay Versus Performance Disclosure As required by SEC rules, we are providing the following information about the relationship between executive “compensation actually paid” (CAP) and certain measures of the company’s financial performance. For further information concerning our pay-for-performance philosophy and how our compensation committee aligns executive compensation with the company’s performance, refer to the section titled “Compensation Discussion and Analysis.” The tabular and narrative disclosures provided below are intended to be calculated in a manner consistent with the applicable SEC rules and may reflect reasonable estimates and assumptions where appropriate.

  47. Pay Versus Performance Table

    Pay Versus Performance Table The following table provides information regarding the CAP to our principal executive officer (PEO) and, as an average, for our other named executive officers (non-PEO NEOs), and select financial performance measures, in each case, during the years ended December 31, 2023, 2022, 2021, and 2020.

  48. Pay Versus Performance Table

    | Year | Summary Compensation Table Total for PEO ($)(1) | Compensation Actually Paid to PEO ($)(2) | Average Summary Compensation Table Total for Non-PEO NEOs ($)(3) | Average Compensation Actually Paid to Non-PEO NEOs ($)(4) | Value of Initial Fixed $100 Investment Based On: | | Net Income (Loss) ($ in thousands)(7) | Revenue ($ in thousands)(8) | | | | | | | Total Shareholder Return ($)(5) | Peer Group Total Shareholder Return ($)(6) | | | | 2023 | 20,515,350 | 36,814,134 | 15,432,708 | 34,721,558 | 488.04 | 219.40 | (183,949) | 1,296,745 | | 2022 | 599,731 | (123,800,316) | 20,203,347 | (56,851,765) | 265.01 | 139.00 | (193,381) | 975,241 | | 2021 | 400,000 | 133,649,996 | 2,803,735 | 71,405,207 | 770.81 | 193.58 | (260,309) | 656,426 | | 2020 | 434,722 | 183,055,568 | 539,152 | 97,974,234 | 445.43 | 143.89 | (119,370) | 431,059 |

  49. Pay Versus Performance Table

    _______________________ (1)The amounts reported reflect the total compensation for Mr. Prince (who has been our PEO since co-founding the company in 2009) for each corresponding year in the “Total” column of the 2023 Summary Compensation Table. For more information, see the section titled “2023 Summary Compensation Table.” (2)The amounts reported represent the amount of CAP to Mr. Prince for the corresponding fiscal year, as computed in accordance with SEC rules as further described below. These amounts do not reflect the actual amount of compensation earned by or paid to Mr. Prince during the applicable year. In accordance with Item 402(v) of Regulation S-K under the Securities Act, the following adjustments were made to Mr. Prince’s total compensation for each year to determine the CAP:

  50. Pay Versus Performance Table

    | Year | Reported Summary Compensation Table Total for PEO ($) | Less: Reported Value of Equity Awards ($)(a) | Add: Equity Award Adjustments ($)(b) | Compensation Actually Paid to PEO ($) | | 2023 | 20,515,350 | 19,331,393 | 35,630,177 | 36,814,134 | | 2022 | 599,731 | — | (124,400,047) | (123,800,316) | | 2021 | 400,000 | — | 133,249,996 | 133,649,996 | | 2020 | 434,722 | — | 182,620,846 | 183,055,568 |

  51. Pay Versus Performance Table

    _______________________ (a)The grant date fair value of equity awards represents the total of the amounts reported in the “Stock Awards” and “Option Awards” columns in the 2023 Summary Compensation Table for the applicable year. For more information, see the section titled “2023 Summary Compensation Table.” We have never provided pension benefits to our NEOs; therefore, no adjustments to the 2023 Summary Compensation Table total for changes in pension values are necessary. (b)The equity award adjustments for each applicable year include the addition (or subtraction, as applicable) of the following: (i) the year-end fair value of any equity awards granted in the applicable year that are outstanding and unvested as of the end of the year; (ii) the amount of change as of the end of the applicable year (from the end of the prior fiscal year) in fair value of any awards granted in prior years that are outstanding and unvested as of the end of the applicable year; (iii) for awards that are granted and vest in the same applicable year, the fair value as of the vesting date; (iv) for awards granted in prior years that vest in the applicable year, the amount equal to the change as of the vesting date (from the end of the prior fiscal year) in fair value; (v) for awards granted in prior years that are determined to fail to meet the applicable vesting conditions during the applicable year, a deduction for the amount equal to the fair value at the end of the prior fiscal year; and (vi) the dollar value of any dividends or other earnings paid on stock or option awards in the applicable year prior to the vesting date that are not otherwise reflected in the fair value of such award or included in any other component of total compensation for the applicable year. The valuation assumptions used to calculate the fair value were updated as of each measurement date and will differ from those disclosed as of the grant date. The methodology used to develop the valuation assumptions as of each applicable measurement date is consistent with those disclosed at the time of grant. The amounts deducted or added in calculating the equity award adjustments are as follows:

  52. Pay Versus Performance Table

    | Year | Year-End Fair Value of Equity Awards Granted in the Year and that are Outstanding and Unvested ($) | Year-over-Year Change in Fair Value of Equity Awards Granted in Prior Years that are Outstanding and Unvested ($) | Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year ($) | Change in Fair Value Between the End of the Prior Year and the Vesting Date of Equity Awards Granted in Prior Years that Vested in the Year ($) | Prior Year-End Fair Value of Equity Awards that Failed to Meet Vesting Conditions in the Year ($) | Value of Dividends or other Earnings Paid on Equity Awards not Otherwise Reflected in Fair Value or Total Compensation ($) | Total Equity Award Adjustments ($) | | 2023 | 20,800,846 | — | 3,538,488 | 11,290,843 | — | — | 35,630,177 | | 2022 | — | (64,717,501) | — | (59,682,546) | — | — | (124,400,047) | | 2021 | — | 97,142,504 | — | 36,107,493 | — | — | 133,249,996 | | 2020 | — | 162,057,497 | — | 20,563,348 | — | — | 182,620,846 |

  53. Pay Versus Performance Table

    _______________________ For purposes of calculating the CAP to our PEO, compensation related to equity awards was remeasured. For RSUs, the fair values and the change in fair values were determined by the closing price of our common stock at each applicable fiscal year-end date or, in the case of vested awards, the stock price on the vesting date. For stock options, a Black-Scholes-Merton option valuation model (BSM model) was used as of the applicable year-end date or, in the case of vested options, the vesting date. Similarly, for performance stock options, a Monte Carlo simulation model in conjunction with the BSM model was used. The BSM model and Monte Carlo Simulation model require assumptions and judgments regarding the variables used in the calculation, including the expected remaining term, expected volatility, expected risk-free interest rate, and the expected dividend yield. The assumptions used varied by measurement date and the range of these assumptions used for each fiscal year end are as follows:

  54. Pay Versus Performance Table

    | | Year Ended December 31, | | | | | | | 2023 | 2022 | 2021 | 2020 | 2019 | | Expected remaining term (in years) | 1.0 - 1.5 | 1.5 | 1.5 - 2.5 | 2.0 - 3.0 | 2.5 - 3.5 | | Expected volatility | 63.88% - 93.37% | 62.67% - 88.34% | 57.40% - 66.52% | 38.09% - 67.60% | 34.84% - 36.30% | | Expected risk-free interest rate | 3.82% - 5.34% | 0.69% - 4.52% | 0.11% - 0.85% | 0.11% - 1.57% | 1.59% - 1.63% | | Expected dividend yield | — | — | — | — | — |

  55. Pay Versus Performance Table

    ______________________ (3)The amounts reported represent the average of the amounts reported for the non-PEO NEOs in the “Total” column of the 2023 Summary Compensation Table in each applicable year. The names of each of the non-PEO NEOs included for purposes of calculating the average amounts in each applicable year are as follows: Michelle Zatlyn, Thomas Seifert, and Douglas Kramer. (4)The amounts reported represent the average amount of CAP to the non-PEO NEOs specified in footnote (3), as computed in accordance with SEC rules. These amounts do not reflect the actual average amount of compensation earned by or paid to the non-PEO NEOs during the applicable year. In accordance with Item 402(v) of Regulation S-K under the Securities Act, the following adjustments were made to average total compensation for the non-PEO NEOs for each year to determine the CAP, using the same methodology described above in footnote (2), including with respect to the remeasurement of compensation related to equity awards:

  56. Pay Versus Performance Table

    | Year | Average Reported Summary Compensation Table Total for Non-PEO NEOs ($) | Less: Average Reported Value of Equity Awards ($) | Add: Average Equity Award Adjustments ($)(a) | Average Compensation Actually Paid to Non-PEO NEOs ($) | | 2023 | 15,432,708 | 14,790,223 | 34,079,072 | 34,721,558 | | 2022 | 20,203,347 | 19,320,714 | (57,734,399) | (56,851,765) | | 2021 | 2,803,735 | 2,270,402 | 70,871,874 | 71,405,207 | | 2020 | 539,152 | — | 97,435,081 | 97,974,234 |

  57. Pay Versus Performance Table

    (a)The amounts deducted or added in calculating the total average equity award adjustments are as follows:

  58. Pay Versus Performance Table

    | Year | Average Year-End Fair Value of Equity Awards Granted in the Year and that are Outstanding and Unvested ($) | Average Year-over-Year Change in Fair Value of Equity Awards Granted in Prior Years that are Outstanding and Unvested ($) | Average Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year ($) | Average Change in Fair Value Between the End of the Prior Year and the Vesting Date of Equity Awards Granted in Prior Years that Vested in the Year ($) | Average Prior Year-End Fair Value of Equity Awards that Failed to Meet Vesting Conditions in the Year ($) | Average Value of Dividends or other Earnings Paid on Equity Awards not Otherwise Reflected in Fair Value or Total Compensation ($) | Average Equity Award Adjustments ($) | | 2023 | 14,045,019 | 11,603,751 | 2,314,766 | 6,115,537 | — | — | 34,079,072 | | 2022 | 6,724,110 | (34,558,762) | — | (29,899,746) | — | — | (57,734,399) | | 2021 | 3,572,548 | 48,739,135 | — | 18,560,191 | — | — | 70,871,874 | | 2020 | — | 84,826,382 | — | 12,608,699 | — | — | 97,435,081 |

  59. Pay Versus Performance Table

    _______________________ (5)Total shareholder return (TSR) is the value of $100 at the end of the measurement period assuming invested in the company’s Class A common stock as of the beginning of the measurement period and reinvesting all dividends. The company has not paid dividends historically. (6)Peer group TSR is the value of $100 at the end of the measurement period assuming invested in the peer group index as of the beginning of the measurement period. Value of initial fixed $100 investment based on peer group TSR has been updated from using a "price return" to "total return" methodology, in order to take into account cumulative amount of dividends for the measurement period as required by Item 201(e) of Regulation S-K. The peer group used for this purpose is the following published industry index: Standard & Poor 500 Information Technology Index (the Index), as used in the company’s stock performance graph included in our 2023 Annual Report. (7)The amounts reported represent our net income (loss), as reflected in the company’s audited financial statements for the applicable year as included in our 2023 Annual Report. (8)The amounts reported represent our revenue, as reflected in the company’s audited financial statements for the applicable year as included in our 2023 Annual Report. While we use several financial performance measures for purposes of our compensation programs, we have determined that revenue is the financial performance measure that, in our assessment, represents the most important performance measure (that is not otherwise required to be disclosed in the table) used by the company to link CAP to the named executive officers, for the most recently completed fiscal year, to the company’s performance.

  60. Analysis of the Information Presented in the Pay Versus Performance Table

    Analysis of the Information Presented in the Pay Versus Performance Table As required by SEC rules, we are providing the following graphical descriptions of the relationships between information presented in the Pay Versus Performance Table. Compensation Actually Paid and Total Shareholder Return The following graph shows the relationships between the amount of CAP to Mr. Prince, the average amount of CAP to the non-PEO NEOs, the company’s cumulative TSR, and the cumulative TSR of the company’s peer group over the four years presented in the Pay Versus Performance Table. Compensation Actually Paid and Net Income (Loss) The following graph shows the relationships between the amount of CAP to Mr. Prince, the average amount of CAP to the non-PEO NEOs, and the company’s net income (loss) over the four years presented in the Pay Versus Performance Table. Compensation Actually Paid and Revenue The following graph shows the relationships between the amount of CAP to Mr. Prince, the average amount of CAP to the non-PEO NEOs, and the company’s revenue over the four years presented in the Pay Versus Performance Table.