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What changed in Asana, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Asana, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+505 added−361 removedSource: 10-K (2024-03-14) vs 10-K (2023-03-24)

Top changes in Asana, Inc.'s 2024 10-K

505 paragraphs added · 361 removed · 253 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

107 edited+49 added−61 removed32 unchanged
Biggest changeIn addition to our ERGs, we support employee driven communities for parents and caregivers, mental health and wellness, and people with disabilities. • Providing robust mental health and wellness benefits, including free therapy and mental health coaching sessions for all employees. • Establishing a DIB Council, an internal group of cross-functional stakeholders including executive leaders that weigh in on and provide perspectives on various initiatives undertaken by the DIB team. • Signing amicus briefs that support inclusion and equity, including: opposing anti-transgender laws, supporting the Voting Rights Act of 1965, opposing restricting access to reproductive healthcare, supporting the Deferred Action for Childhood Arrivals program, supporting non-discrimination rights for LGBTQ+ Americans, and supporting protection for sanctuary cities in the United States.
Biggest changeAll ERG Leads also participate in an ERG Leadership Development program designed to strengthen leadership skills. • Providing robust mental health and wellness benefits, including free therapy and mental health coaching sessions for all employees. • Establishing a DIB Council, an internal group of cross-functional stakeholders including executive leaders that weigh in on and provide perspectives on various initiatives undertaken by the DIB team.
This includes facilitating discussions on issues that are important to our communities, including race, sexuality, mental health and allyship, promoting belonging and psychological safety. • Supporting and funding seven Employee Resource Groups (“ERGs”) each supported by a sponsor ERG Lead (a senior member of our leadership team): AsanaWomen, AsanaWomen EMEA, Asanapac, Blacsana, Gradient, Raíz, and Team Rainbow.
This includes facilitating discussions on issues that are important to our communities, including race, sexuality, mental health and allyship, promoting belonging and psychological safety. • Supporting and funding seven Employee Resource Groups (“ERGs”) each supported by an ERG Lead Sponsor (a senior member of our leadership team): AsanaWomen, AsanaWomen EMEA, Asanapac, Blacsana, Gradient, Raíz, and Team Rainbow.
A rule consists of one or more triggers and actions, enabling an individual to create logic and multiple actions around business scenarios. Actions in third-party applications that are integrated with Asana, such as Gmail, Microsoft, Slack, Jira, HubSpot, and Dropbox can also trigger rules, making it easy to automate manual work across applications.
A rule consists of one or more triggers, conditions, and actions, enabling an individual to create logic and multiple actions around business scenarios. Actions in third-party applications that are integrated with Asana, such as Gmail, Microsoft, Slack, Jira, HubSpot, and Dropbox can also trigger rules, making it easy to automate manual work across applications.
Our DIB programs support every employee at Asana to thrive, enabling us to better serve the needs of our diverse customer base. Our DIB strategy can be broken down into three elements: 1. Building a strong foundation of support and resources for employees, 2. Recruiting and developing talent from underrepresented groups and backgrounds, and 3.
Our DIB programs support every employee at Asana to thrive, enabling us to better serve the needs of our diverse customer base. Our DIB strategy can be broken down into three elements: 1. Building a strong foundation of support and resources for employees, 2. Recruiting and developing talent from traditionally underrepresented groups and backgrounds, and 3.
When surprises or disruptions occur, it is easy for team leads to adjust the plan, reallocate resources, and communicate updates in real time. • Executives can communicate company-wide goals, monitor status, and oversee work across projects to gain real-time insights into which initiatives are on track or at risk.
When surprises or disruptions occur, it is easy for team leads to adjust the plan, reallocate resources, and communicate updates in real time. • Executives can communicate company-wide goals, monitor status, and oversee work across projects and portfolios to gain real-time insights into which initiatives are on track or at risk.
The progress of goals can be automatically tracked based on linked work and goals without manual updates and goal reporting enables leaders to keep an eye on their team’s advancements and spot roadblocks in real time. Goals can be connected to mission-critical tools across an organization’s tech stack to get actionable insights.
The progress of goals can be automatically tracked based on linked work and goals without manual updates, and goal reporting enables leaders to keep an eye on their team’s progress and spot roadblocks in real time. Goals can be connected to mission-critical tools across an organization’s tech stack to get actionable insights.
Once adopted, customers can expand through product-led channels or with the assistance of our direct sales team, which is focused on promoting new use cases of Asana and ensuring customers are well supported to grow with Asana.
Once adopted, customers can expand through product-led channels or with the assistance of our direct sales team, which is focused on promoting new use cases of Asana and ensuring customers are well supported to grow with our platform.
Our direct sales force has a global presence, and consists of sales teams focused primarily on accounts with expansion opportunities including department-specific and organization-wide use cases such as strategic planning, employee onboarding, and goal setting.
Our direct sales force has a global presence, and consists of sales teams focused primarily on accounts with expansion opportunities including department-specific and organization-wide use cases such as strategic planning, employee onboarding, and goal setting and tracking.
We have implemented a variety of safeguards to protect the security of our platform, including encrypting user data in transit and at rest, replicating our databases to support reliability of the platform, and controlling access to our facilities and office network.
We have implemented a variety of safeguards designed to protect the security of our platform, including encrypting user data in transit and at rest, replicating our databases to support reliability of the platform, and controlling access to our facilities and office network.
As one example, the EU GDPR applies to any company established in the EEA and to companies established outside the EEA that process personal data in connection with the offering of goods or services to data subjects in the EEA or the monitoring of the behavior of data subjects in the EEA.
As one example, the EU GDPR applies to any company established in the EEA and to companies established outside the EEA that process personal information in connection with the offering of goods or services to data subjects in the EEA or the monitoring of the behavior of data subjects in the EEA.
We will continue to invest in expanding our product offerings and enhancing the features and functionality of our platform, particularly in the areas of integrations, automation, functional workflows, security, and organization-wide use cases.
We will continue to invest in expanding our product offerings and enhancing the features and functionality of our platform, particularly in the areas of AI, integrations, automation, functional workflows, security, and organization-wide use cases.
These obligations may include limiting personal information processing to only what is necessary for specified, explicit, and legitimate purposes; requiring a legal basis for personal information processing; complying with specific requirements to process health-related data; requiring the appointment of a data protection officer in certain circumstances; increasing transparency obligations to data subjects; requiring data protection impact assessments in certain circumstances; limiting the collection and retention of personal information; increasing rights for data subjects; formalizing a heightened and codified standard of data subject consents; requiring the implementation and maintenance of technical and organizational safeguards for personal information; mandating notice of certain personal data breaches to the relevant supervisory authority(ies) and affected individuals; and mandating the appointment of representatives in the UK and/or the EU in certain circumstances.
These obligations may include limiting personal information processing to only what is necessary for specified, explicit, and legitimate purposes; requiring a legal basis for personal information processing; complying with specific requirements to process health-related data; requiring the appointment of a data protection officer in certain circumstances; increasing transparency obligations to data subjects; requiring data protection impact assessments in certain circumstances; limiting the collection and retention of personal information; increasing rights for data subjects; formalizing a heightened and codified standard of data subject consents; requiring the implementation and maintenance of technical and organizational safeguards for personal information; mandating notice of certain personal information breaches to the relevant supervisory authorities and affected individuals; and mandating the appointment of representatives in the UK and/or the EU in certain circumstances.
Like many of the views in Asana, the layout of Portfolios can be customized based on individual preference. Portfolios can be shared broadly or with specific teams or individuals. Goals Goals gives users a centralized place to plan, set, and track goals and the work needed to achieve them.
Like many of the views in Asana, the layout of portfolios can be customized based on individual preference. Portfolios can be shared broadly or with specific teams or individuals. Goals Goals give users a centralized place to plan, set, and track goals and the work needed to achieve them.
Custom fields are metadata that help users organize and track their work. Collaboration including comments, @-mentions, image markup, and text-to-subtask creation are natively built into tasks, ensuring that relevant updates and context stay with the work at hand.
Custom fields are metadata that help users organize and track their work. Collaboration including comments, @-mentions, image markups, and text-to-subtask creation are natively built into tasks, ensuring that relevant updates and context stay with the work at hand.
In contrast, others approach the problem of work management with a container model, relating tables of data which forces units of work into singular constructs; for example, a task can only live in one project or a message can only live in one channel.
In contrast, others approach the problem of work management with a container model, relating tables of data which force units of work into singular constructs; for example, a task can only live in one project or a message can only live in one channel.
Portfolio dashboards and custom field roll ups for key metrics like budget and time and more, give leaders a window into the status and ROI of their investments directly from the Portfolios tab. By streamlining and providing a single view of the health and status of strategic initiatives, capacity, and budgets, leaders can take actions faster to drive business outcomes.
Portfolio dashboards and custom field roll ups for key metrics like budget, time, and other variables, give leaders a window into the status and ROI of their investments directly from the portfolios tab. By streamlining and providing a single view of the health and status of strategic initiatives, capacity, and budgets, leaders can take actions faster to drive business outcomes.
The Asana platform maintains a robust API that enables developers to build apps on Asana and integrate efficiently with applications like Microsoft Teams, Slack, Salesforce, Gmail, Adobe and many more. Integrations connect Asana with applications so that teams are able to coordinate work, no matter where it occurs.
The Asana platform maintains a robust API that enables developers to build apps on Asana and integrate efficiently with applications like Microsoft Teams, Slack, Jira, Salesforce, Gmail, Adobe Creative Cloud and many more. Integrations connect Asana with applications so that teams are able to coordinate work, no matter where it occurs.
For example, the CCPA imposes obligations on covered businesses to provide specific disclosures related to a business’s collection, use, and disclosure of personal information and to respond to certain requests from California residents related to their personal information (for example, requests to know of the business’s personal information processing activities, to delete the individual’s personal information, and to opt out of certain personal information disclosures).
For example, the CCPA imposes obligations on covered businesses to provide specific disclosures related to a business’s collection, use, and disclosure of personal information and to respond to certain requests from 17 Table of Contents California residents related to their personal information (for example, requests to know of the business’s personal information processing activities, to delete the individual’s personal information, and to opt out of certain personal information disclosures).
Individuals can click on any project to see a full summary overview of the project with the ability to edit due dates, view key milestones, link to the tasks and resources available, check or add status updates, and add comments for the team.
Individuals can click on any project to see a full summary overview of the project with the ability to edit due dates, view key milestones, link to the tasks and resources available, check or add 12 Table of Contents status updates, and add comments for the team.
Apps built on Asana may use App Components, which enable developers to display customized widgets, forms, and rules within Asana's user interface that empower teams to work more efficiently. 11 Table of Contents Asana Work Graph Hierarchy The Asana Work Graph captures the relationships, information, and people connected to units of work—tasks, projects, portfolios, goals, and more—to enable a complete, connected, and up-to-date map of work in an organization.
Apps built on Asana may use app components, which enable developers to display customized widgets, forms, and rules within Asana's user interface that empower teams to work more efficiently. 10 Table of Contents Asana Work Graph ® Hierarchy The Asana Work Graph®, our data model, captures the relationships, information, and people connected to units of work—tasks, projects, portfolios, goals, and more—to enable a complete, connected, and up-to-date map of work in an organization.
As customers realize the productivity benefits we provide, our platform often becomes critical to managing their work and achieving their objectives, which drives further adoption and expansion opportunities. This is evidenced by our dollar-based net retention rate, which generally increases with greater organizational s pend.
As customers realize the productivity benefits provided by Asana, our platform often becomes critical to managing their work and achieving their objectives, which drives further adoption and expansion opportunities. This is evidenced by our dollar-based net retention rate, which generally increases with greater organizational s pend.
Copies of our reports on Form 10-K, Forms 10-Q, Forms 8-K, and amendments to those reports may also be obtained, free of charge, electronically through our investor relations 23 Table of Contents website located at investors.asana.com as soon as reasonably practical after we file such material with, or furnish it to, the SEC.
Copies of our reports on Form 10-K, Forms 10-Q, Forms 8-K, and amendments to those reports may also be obtained, free of charge, electronically through our investor relations website located at investors.asana.com as soon as reasonably practicable after we file such material with, or furnish it to, the SEC.
Changes in task information made in one view are automatically updated across all views where the task is visible so that users don’t have to re-enter information. Projects A project consists of a set of tasks, which can be organized into sections and arranged into dependencies that give teams clarity on plan and process.
Changes in task information made in one view are automatically updated across all views where the task is visible so that all users don’t have to re-enter information. Projects A project consists of a set of tasks, which can be organized into sections and arranged into dependencies that give teams clarity around priorities.
Users 13 Table of Contents can drag-and-drop and reconfigure the layout of widgets to personalize and quickly get insight into the work that matters most. My Tasks My Tasks provides a single, clear view of every task and due date assigned to an individual so that they start their day knowing exactly what they need to do, by when.
Users can reconfigure the layout of widgets to personalize and quickly get insight into the work that matters most. My Tasks My tasks view provides a single, clear view of every task and due date assigned to an individual so that they start their day knowing exactly what they need to do, by when.
Such obligations may include, without limitation, the Federal Trade Commission Act, the CCPA, the Canadian Personal Information Protection and Electronic Documents Act, Canada’s Anti-Spam Legislation, the European Union’s General Data Protection Regulation 2016/679 (“EU GDPR”), the EU GDPR as it forms part of United Kingdom (“UK”) law by virtue of section 3 of the European Union (Withdrawal) Act 2018 (“UK GDPR”), and the Payment Card Industry Data Security Standard (“PCI DSS”).
Such obligations may include, without limitation, the Federal Trade Commission Act, the CCPA, the Canadian Personal Information Protection and Electronic Documents Act, Canada’s Anti-Spam Legislation, the EU GDPR, the EU GDPR as it forms part of United Kingdom (“UK”) law by virtue of section 3 of the European Union (Withdrawal) Act 2018 (“UK GDPR”), and the Payment Card Industry Data Security Standard (“PCI DSS”).
Goals is a flexible system that supports objectives and key results (“OKR”) and other goal management methodologies. Users can set and view goals at the organization, team, or individual level and can create goal hierarchies to drive alignment across teams.
Goals are a flexible system that supports objectives and key results (“OKRs”) and other goal management methodologies. Users can set and view goals at the organization, team, or individual level and can create goal hierarchies to drive alignment across teams.
Information contained on, or that can be accessed through, our website is not incorporated by reference into this Annual Report on Form 10-K. The Asana design logo, “Asana,” and our other registered or common law trademarks, service marks or trade names appearing in this Annual Report on Form 10-K are the property of Asana, Inc.
Information contained on, or that can be accessed through, our website is not incorporated by reference into this Annual Report on Form 10-K. The Asana logo, “Asana,” “Work Graph,” and our other registered or common law trademarks, service marks or trade names appearing in this Annual 22 Table of Contents Report on Form 10-K are the property of Asana, Inc.
We provide our employees with competitive cash compensation, opportunities for equity ownership at all levels of the organization, development programs that enable continued learning and growth (including access to 1:1 professional coaching for every employee) and a robust employment package that promotes well-being across all aspects of their lives, including health care, retirement savings vehicles, and paid time off.
We provide our employees with competitive cash compensation, opportunities for equity ownership at all levels of the organization, development programs that enable continued learning and growth and a robust employment package that promotes well-being across all aspects of their lives, including health care, retirement savings vehicles, and paid time off.
With this visibility, they can proactively ensure alignment, address inefficiencies, manage team workload, and reallocate work among teams or departments so that the company can stay on track to achieve its objectives. As the system of record of past, current, and future work, Asana is powered by a proprietary, multi-dimensional data model called the Asana Work Graph.
With this visibility, they can proactively ensure alignment, address inefficiencies, manage team workload, and reallocate work among teams or departments so that the company can stay on track to achieve its objectives. As a single source of truth for past, current, and future work, Asana is powered by our proprietary data model called the Asana Work Graph.
As individuals, teams, and their guests realize the productivity benefits we provide, Asana becomes an integral part of their day-to-day work and critical to helping them achieve their objectives. Direct Sales In conjunction with our product-led model, we have a targeted direct sales team focused on promoting new use cases and expanding our footprint within our existing customer base.
As individuals, teams, and their guests realize the productivity benefits we provide, Asana becomes an integral part of their day-to-day work and critical to helping them achieve their objectives. 18 Table of Contents Direct Sales In conjunction with our product-led model, we have a targeted direct sales team focused on promoting new use cases, expanding our footprint within our existing customer base, and landing large enterprise accounts with a top-down motion.
Marketing and Customer Success We market our platform through owned properties, such as our website and social media channels, media coverage, paid acquisition, and word of mouth to promote discovery and adoption. Every month millions of people visit asana.com, and hundreds of thousands of people register for the product.
Marketing and Customer Success We market our platform through owned properties, such as our website, first-party events like the Work Innovation Summit, third-party events, social media channels, media coverage, paid acquisition, and word of mouth to promote discovery and adoption. Every month millions of people visit asana.com, and hundreds of thousands of people register for the product.
Build: We’re intentional about laying a foundation of support and resources for our employees to be successful including: • Comprehensive DIB onboarding curriculum for new employees • Mandatory anti-harassment training • Bias awareness training • Psychological safety workshops for managers and their teams • Inclusive leadership workshops for managers 21 Table of Contents • 16 weeks of parental leave, regardless of gender Recruit: We believe hiring and developing talent from underrepresented groups and backgrounds is a shared responsibility.
Build: We’re intentional about laying a foundation of support and resources for our employees to be successful including: • Comprehensive DIB onboarding curriculum for new employees • Mandatory anti-harassment training • Bias awareness training • Psychological safety workshops for managers and their teams • Inclusive leadership workshops for managers • 16 weeks of parental leave, regardless of gender identity • Inclusive fertility health and family forming benefits Represent: We believe hiring and developing talent from underrepresented groups and backgrounds is a shared responsibility.
Most important work requires coordination across teams and geographies, for example, a product launch with product, marketing and sales all working together. Without a system of record, organizations move slowly, miss deadlines, and fail to live up to their full potential.
Most important work requires coordination across teams and geographies - e.g., a product launch with product, marketing, sales, legal, and finance all working together. Without a system of record, organizations move more slowly, miss deadlines, and fail to live up to their full potential.
Powered by a proprietary, multi-dimensional data model called the Asana Work Graph, our platform captures the relationship between the work (e.g. tasks, goals, ideas, agenda items), the information about that work (e.g. custom fields, messages, files, dependencies, status), and the people doing the work (e.g. assignees, roles, teams, divisions).
Powered by the Asana Work Graph, our platform captures the relationship between the work (e.g. tasks, goals, ideas, agenda items), the information about that work (e.g. custom fields, messages, files, dependencies, status), and the people doing the work (e.g. assignees, roles, teams, divisions).
Additionally, of our global workforce, as of January 31, 2023, approximately 45% of our employees identify as female, 54% identify as male, and 1% identify as TGNC, which includes the categories of agender, gender non-conforming, genderqueer, transgender, and non-binary. 22 Table of Contents Additional information regarding our commitment to diversity and inclusion can be found on our website at https://asana.com/diversity-and-inclusion .
Additionally, of our global workforce, as of January 31, 2024, approximately 46% of our employees identify as female, 53% identify as male, and 1% identify as TGNC, which includes the categories of agender, gender non-conforming, genderqueer, transgender, and non-binary. Additional information regarding our commitment to diversity and inclusion can be found on our website at https://asana.com/diversity-and-inclusion .
The Asana Work Graph is the technology that makes it possible for every individual and team to view their work in a way that is personally relevant to them, while maintaining a single, always-up-to-date, record of every goal, project, task, document, etc.
It’s the technology that makes it possible for every individual and team to view their work in a way that is personally relevant to them, while maintaining a single, up-to-date, record of every goal, portfolio, project, and task.
We use these channels, as well as social media, including our Twitter account (@asana), our blog (blog.asana.com), our LinkedIn page (www.linkedin.com/company/asana), our Instagram account (@asana), our TikTok account (@asana), and our Facebook page (www.facebook.com/asana/), to communicate with investors and the public about our company, our products and services and other matters.
We use these channels, as well as social media, including our X (formerly Twitter) account (@asana), our LinkedIn page (www.linkedin.com/company/asana), our Instagram account (@asana), our Facebook page (www.facebook.com/asana/), and Threads profiles (@asana and @moskov), to communicate with investors and the public about our company, our products and services and other matters.
Organizations need more effective tools to orchestrate work The primary methods for managing work today—across any department, any sized team, and any project—consist of a combination of spreadsheets and email, in addition to handwritten notes, calls, and meetings.
The primary methods for managing work today—across any department, any sized team, and any project—consist of a combination of spreadsheets and email, in addition to handwritten notes, calls, and meetings.
It enables organizations to align work to goals, coordinate intra and cross-team work, gain visibility into progress, and scale work securely.
It enables organizations to align work to goals, coordinate intra- and cross-team work, gain visibility into progress, automate workflows across departments, and scale work securely.
Within tasks, users can assign owners, set due dates and times, attach documents, break the work into subtasks, and define custom fields for information about the 12 Table of Contents task so that everyone knows who is doing what by when and has the information needed to complete the work.
Tasks Tasks are the fundamental unit of work within the Asana Work Graph. Within tasks, users can assign owners, set due dates and times, attach documents, break the work into subtasks, and define custom fields for information about the task so that everyone knows who is doing what by when and has the information needed to complete their work.
It also features industry-approved templates made in collaboration with leading organizations around the globe. Rules Rules help automate tedious and repetitive tasks so that teams can reduce manual work and spend more time on the work that matters. Individuals can select from suggested pre-built rules from the rules gallery or they can create a custom rule.
It also features industry-approved templates made in collaboration with leading global organizations. 14 Table of Contents Rules Rules help automate tedious and repetitive tasks so that teams can reduce manual work and spend more time on the work that matters. Individuals can select from suggested template rules from the rules gallery or they can create a custom rule.
Board View Boards provide individuals with a kanban-style display. Individuals use boards to plan and organize their work as if they were organizing sticky notes in columns on a wall so that they can quickly visualize the current stage of each task within a workstream.
Board View Board view allows individuals to plan and organize their work as if they were organizing sticky notes in columns on a wall so that they can quickly visualize the current stage of each task within a workstream.
Our Business Model Our hybrid product-led and direct sales model allows us to reach teams everywhere and then rapidly expand the use of our platform within their organizations. A majority of our paying customers initially adopt our platform through product-led channels, like signing up on our website, and free trials.
Our Business Model We have historically had both a product-led and a direct sales model that allow us to reach teams everywhere and then rapidly expand the use of our platform within their organizations. A majority of our paying customers initially adopt our platform through product-led channels, like signing up on our website and free trials.
Our security program includes conducting risk assessments of all systems and networks that process customer data; monitoring for security events; maintaining incident response, disaster recovery, and business continuity plans that explicitly address and provide guidance to our personnel in furtherance of the security, confidentiality, integrity, and availability of customer data; and having a qualified third party perform security assessments on a periodic basis to test against widely recognized security standards and practices.
Our security program includes conducting risk assessments of our systems that process the data 16 Table of Contents our customers store in Asana; monitoring for security events; maintaining incident response, disaster recovery, and business continuity plans that explicitly address and provide guidance to our employees in furtherance of the security, confidentiality, integrity, and availability of customer data; and having a qualified third party perform security assessments on a periodic basis to test against security standards and practices.
We believe we compete favorably based on the following competitive factors: • adaptability to a broad range of use cases; • features and functionality of platform capabilities; • developments and enhancements of work management solutions; • customer service and support efforts; • hybrid go-to-market model; • ease of use, performance, price, and reliability of solutions; • scalability and security; • brand strength; and • ability to create easy to use integrations for, and robust, effective partnerships with, other larger enterprise software solutions and tools.
We believe we compete favorably based on the following competitive factors: • The Asana Work Graph®, our unique and differentiated data model; 19 Table of Contents • adaptability to a broad range of use cases; • features and functionality of platform capabilities; • developments and enhancements of work management solutions; • customer service and support efforts; • ease of use, performance, price, and reliability of solutions, including AI-powered features; • scalability and security; • brand strength; and • our ability to create easy to use integrations for, and robust, effective partnerships with, other larger enterprise software solutions and tools.
The Asana platform integrates with over 260 third-party applications including: • Microsoft 365 apps such as Teams, Outlook, OneDrive, SharePoint, Power Automate, Power Bi, and Azure Active Directory; • Google Workspace apps such as Gmail, Drive, Chat, Calendar, Chrome, Looker, and Sheets; • Enterprise IT apps such as Splunk, ServiceNow, Okta, Azure Active Directory, MuleSoft, BetterCloud, Workato, and Exterro; • Marketing and Design apps such as Adobe Creative Cloud, Canva, Figma, HubSpot, Mailchimp, Lucidchart, and InVision; • Communication apps such as Microsoft Teams, Gmail, Slack, Zoom, Google Chat, Vimeo, Wistia, Intercom, and Loom; • File sharing apps such as Google Drive, Microsoft OneDrive, Box, Bynder, and Dropbox; • Sales and service apps such as Salesforce, ServiceNow, Zendesk, HubSpot, Freshdesk, and Zoho; • Development apps such as GitHub, Jira, PagerDuty, and ServiceNow; • Reporting apps such as Tableau, Microsoft Power BI, Looker, and Google Sheets; • Security, Privacy, and Compliance apps such as Exterro, Netskope, Splunk, Nightfall, and OneTrust; and • Connector apps such as MuleSoft, Zapier, Workato, Microsoft Power Automate, and tray.io.
The Asana platform includes out-of-the-box integrations with over 300 third-party applications including: • Microsoft 365 apps such as Teams, Outlook, OneDrive, SharePoint, Power Automate, Power BI, and Entra ID (formerly known as Azure Active Directory); 15 Table of Contents • Google Workspace apps such as Gmail, Calendar, Drive, Docs, Sheets, Chat, and Looker; • Enterprise IT apps such as Splunk, Okta, Entra ID (formerly known as Azure Active Directory), MuleSoft, ServiceNow, Exterro, and Workato; • Marketing and design apps such as Adobe Creative Cloud, Canva, Figma, HubSpot, Mailchimp, Lucidchart, and InVision; • Communication apps such as Microsoft Teams, Slack, Zoom, Google Chat, Vimeo, Wistia, Intercom, and Loom; • File sharing apps such as Google Drive, Microsoft OneDrive, Box, Dropbox, and Bynder; • Sales and service apps such as Salesforce, ServiceNow, Zendesk, HubSpot, Freshdesk, and Zoho; • Developer apps such as GitHub, Jira Cloud and Server, PagerDuty, and ServiceNow; • Reporting and business intelligence apps such as Tableau, Microsoft Power BI, Looker, and Google Sheets; • Privacy, data protection, and security compliance apps such as Splunk, Nightfall, Exterro, Netskope, and OneTrust; and • Connector apps such as MuleSoft, Zapier, Workato, Microsoft Power Automate, and tray.io.
As of January 31, 2023, we had been granted 41 U.S. patents, had 73 U.S. patent applications pending, and four notices of allowance. Our issued patents expire between January 2030 and March 2042. We have not applied for patents in foreign jurisdictions. We continually review our development efforts to assess the existence and patentability of new intellectual property.
As of January 31, 2024, we had been granted 71 U.S. patents, had 72 U.S. patent applications pending, and four notices of allowance. Our issued patents expire between January 2031 and May 2043. We have not applied for patents in foreign jurisdictions. We continually review our development efforts to assess the existence and patentability of new intellectual property.
The Asana Work Graph provides unique capabilities to relate work such as multi-homing, which enables work like tasks to be shared between multiple projects or workflows without duplication. Different teams view and share the very same tasks, reducing confusion and work about work.
The Asana Work Graph provides unique capabilities, such as multi-homing, which enables tasks to be shared between multiple projects or workflows without duplication. Different teams view and share the very same tasks, reducing duplicative work and creating cross-functional clarity and accountability.
Some examples of how we have taken on some of that responsibility here at Asana are detailed below. • Establishing representation goals related to race/ethnicity and gender, across our functions • Auditing and building equitable hiring processes • Dedicated outreach to candidates from underrepresented communities • Partnering with organizations aligned with underrepresented communities in the technology space including Techqueria, AfroTech, Year Up, and The Marcy Lab School • Developing individual careers through AsanaUp, our apprenticeship program focused on providing pathways to roles at Asana for individuals from historically marginalized communities • Inclusivity, Diversity, and Equity for Asana Leadership (“IDEAL”) Interviewing Policy, which ensures we interview at least one candidate from an underrepresented group and one non-male candidate for every leadership role Thrive: Our goal is to create an environment so inclusive that every employee of Asana feels confident bringing the parts of themselves to work that they need to in order to thrive in their role.
Some examples of how we have taken on some of that responsibility here at Asana are detailed below. • Establishing representation goals related to race/ethnicity and gender, across our functions • Auditing and building equitable hiring processes • Developing individual careers through AsanaUp, our apprenticeship program focused on providing pathways to roles at Asana for individuals from historically marginalized communities • Inclusivity, Diversity, and Equity for Asana Leadership (“IDEAL”) Interviewing Policy, which ensures we interview at least one candidate from a traditionally underrepresented group and one non-male candidate for every leadership role • Sponsorship and peer mentorship programs to support career growth 21 Table of Contents Thrive: Our goal is to create an environment so inclusive that every employee of Asana feels confident bringing the parts of themselves to work that they need to in order to thrive in their role.
As of January 31, 2023, of our global workforce approximately 44% identify as Caucasian, 40% identify as Asian, 7% identify as Hispanic or Latinx, 5% identify as Black or African American, 2% identify as Middle Eastern, 1% identify as Pacific Islander, and 1% identify as Native American, Alaskan, Indigenous.
As of January 31, 2024, of our global workforce approximately 42% identify as Caucasian, 36% identify as Asian, 6% identify as Hispanic or Latinx, 5% identify as Black or African American, 1% identify as Middle Eastern, 1% identify as Pacific Islander, and 1% identify as Native American, Alaskan, Indigenous.
A core tenet of our culture is a shared commitment to mindfulness, which informs our product, business, and people decisions and shapes how we interact with each other daily.
Our Culture Our company culture is a core driver of our business success and enables us to work towards achieving our mission. A core tenet of our culture is a shared commitment to mindfulness, which informs our product, business, and people decisions and shapes how we interact with each other daily.
We define a paying customer as a customer on a paid subscription plan. As of January 31, 2023, we had over 139,000 paying customers globally, representing an increase of approximately 20,000 paying customers from January 31, 2022 and an increase of approximately 46,000 from January 31, 2021.
We define a paying customer as a customer on a paid subscription plan. As of January 31, 2024, we had over 150,000 paying customers globally, representing an increase of more than 11,000 from January 31, 2023 and an increase of approximately 31,000 from January 31, 2022.
Additionally, 506 of those paying customers spent $100,000 or more with us on an annualized basis, representing an increase of 166 paying customers from January 31, 2022 and an increase of 358 paying customers from January 31, 2021.
Additionally, 607 of those paying customers spent $100,000 or more with us on an annualized basis, representing an increase of 101 paying customers from January 31, 2023 and an increase of 267 paying customers from January 31, 2022.
To demonstrate the value of our platform to potential paying customers, we provide free trials of our paid Asana Business offering, in addition to our free Basic offering, for teams of up to 15 people.
Product-led To demonstrate the value of our platform to potential paying customers, we provide free trials of our paid Asana Advanced offering, in addition to our free Personal offering, for teams of up to 10 people.
It displays updates on all projects that individuals are a member of and tasks that they follow or are assigned so that they can stay on top of the work that matters.
It displays updates on all projects that individuals are a member of and tasks that they follow or are assigned so that they can stay on top of the work that matters. List View The list view of a project lets individuals sort, organize into sections, and filter a list of tasks.
We also offer our customers the option to partner with a list of managed service providers, consulting firms, and system integrators to help customize their account, onboard teams and run onsite training. Our global community of customers and experts, Asana Together, connects customers, both online and offline, and creates champions.
We also offer our customers the option to partner with a list of managed service providers, consulting firms, and system integrators to help customize their account, onboard teams and run onsite training.
Our security program is aligned to the American Institute of Certified Public Accountants (“AICPA”) Trust Services Criteria for Security, Availability, and Confidentiality as well as the ISO 27001:2013 standards. We issue a SOC 2 Type II report on an annual basis and are certified against ISO 27001:2013, ISO 27017:2015, ISO 27018:2019, and ISO/IEC 27701:2019.
Our security program considers the American Institute of Certified Public Accountants (“AICPA”) Trust Services Criteria for Security, Availability, and Confidentiality as well as the ISO 27001:2013 standards for the systems that process the data our customers store in Asana. We issue a SOC 2 Type II report on an annual basis and are certified against ISO 27001:2013, and ISO 27017:2015.
Asana also offers Enterprise customers the additional visibility and control with capabilities such as multi-factor authentication, audit logs, security information event management (“SIEM”), data governance, and international data residency, to further the security of their teams’ data. Enterprise customers can also purchase Enterprise Key Management to gain more control over their data and meet their organization’s most critical compliance needs.
Asana also offers Enterprise and Enterprise+ customers the additional visibility and control with capabilities such as multi-factor authentication, audit logs, security information event management (“SIEM”), data governance, and international data residency, designed to further the security and privacy of their teams’ data.
Instead of spending time on work that generated results, they were spending time in status meetings and long email threads trying to figure out who was responsible for what. They recognized the pain of work about work was universal to organizations that need to coordinate their work effectively to achieve their objectives.
Instead of spending time on work that generated results, they were spending time in status meetings and long email threads trying to coordinate work effectively to achieve their objectives, a pain universal to organizations.
Teams Spend Too Much Time on Work About Work Work continues to get harder to manage as organizations try to move faster to accomplish ambitious goals and respond to changing market demands. According to Asana’s most recent Anatomy of Work Index report, 58% of knowledge workers’ time is spent on work about work.
Industry Background Organizations spend too much time and effort on coordination Work continues to get harder to manage as organizations try to move faster to accomplish ambitious goals and respond to changing global conditions and market demands. According to Asana’s 2023 Anatomy of Work Index report, 58% of an average knowledge worker’s work week is spent on busywork.
As of January 31, 2023, our dollar-based net retention rate within organizations spending $5,000 or more with us on an annualized basis was over 120%, consisting of 19,432 customers. Our dollar-based net retention rate within organizations spending $100,000 or more with us on an annualized basis was over 135%, consisting of 506 customers.
As of January 31, 2024, our dollar-based net retention rate within organizations spending $5,000 or more with us on an annualized basis (“Core customers”) was 105%, consisting of 21,646 customers. Our dollar-based net retention rate within organizations spending $100,000 or more with us on an annualized basis was 115%, consisting of 607 customers.
By investing in diversity and inclusion programs, we help ensure that everyone can thrive and feel a sense of belonging, enabling us to better understand the needs of our diverse customer base and innovate in new and creative ways.
By investing in diversity, equity, inclusion, and belonging programs, we help ensure that everyone can thrive with a better understanding of the needs of our diverse customer base and innovate in new and creative ways. We strive to uphold a culture where all employees feel connected to one another and our mission.
The Asana Work Graph provides individuals, team leads, and executives with dynamic, up-to-date views into the work that is most relevant to them, across multiple people and projects. The core tenet of our platform is to bring clarity, transparency, and accountability to the process of getting work done. Clarity.
The Asana Work Graph provides individuals, team leads, and executives with dynamic, up-to-date views into the work that is most relevant to them, across multiple people and projects. The core tenet of our platform is to create clarity and accountability up, down, and across the organization, maximize every employee’s impact, and help organizations scale these efficiencies with security and control.
As data protection authorities and regulators interpret and issue guidance on the GDPR, along with other new and existing data protection laws around the world, we will continue to follow developments and enhance our program as needed. Governmental Regulation In the ordinary course of our business, we may process confidential, proprietary, and sensitive information, including personal information.
As data protection authorities and regulators interpret and issue guidance on the EU GDPR, along with other new and existing privacy, data protection, and security laws around the world, we will continue to follow developments and enhance our privacy program as needed.
We are focused on landing teams worldwide and expanding across use cases, both within and between organizations, to ensure the success of our customers.
We are focused on landing teams worldwide and expanding across use cases, both within and between organizations, to ensure the success of our customers. This in turn creates positive word-of-mouth marketing, driving adoption, expansion and ultimately our business results.
The Asana Work Graph provides: • Individuals with dynamic views into the work that is most relevant to them, accelerating adoption, maximizing personal productivity, and empowering individuals with knowledge of how their work has an impact on organizational goals . • Teams with the ability to view and modify the same work data across different views and create workflows that coordinate complex, cross-team work with ease. • Executives with visibility into how daily work connects to higher-level goals and initiatives so they can understand real-time progress.
The Asana Work Graph provides: • Individuals with dynamic views into the work that is most relevant to them, maximizing personal productivity and empowering individuals with transparency into how their work helps achieve organizational goals . • Teams and departments with the ability to view and modify the same work data across different views and create workflows that coordinate complex, cross-functional work with ease. • Executives with visibility into how daily work connects to higher-level goals and initiatives so they can understand real-time progress, and take action to align their teams on projects that advance their corporate goals. 11 Table of Contents AI Asana Intelligence, our platform’s generative AI and machine learning capabilities, are powered by our proprietary Work Graph, our data model.
Additionally, we are, or may become, subject to various U.S. federal and state consumer protection laws which require us to publish statements that accurately and fairly describe how we handle personal information and choices individuals may have about the way we handle their personal information. 17 Table of Contents The CCPA and EU GDPR are examples of the increasingly stringent and evolving regulatory frameworks related to personal information processing that may increase our compliance obligations and exposure for any noncompliance.
Additionally, we are, or may become, subject to various U.S. federal and state consumer protection laws which require us to publish statements that accurately and fairly describe how we handle personal information and choices individuals may have about the way we handle their personal information.
Team leads see progress, bottlenecks, resource constraints, and milestones without having to create work for teams to come up with this information in spreadsheets, email, or via a status meeting.
This clarity reduces busywork and helps individuals get work done faster. • Team leads and directors can manage work across a portfolio of projects or workflows, see progress against goals, identify bottlenecks, resource constraints, and milestones without having to create work for teams to come up with this information in spreadsheets, email, or via a status meeting.
Users can also add everyday apps — like Google Workspace, Microsoft 365, Slack, Adobe Creative Cloud, Salesforce, and Zoom – right into their workflows. This means Asana can serve as the connective tissue across existing best-of-breed collaboration solutions. Our Template Library is where users can save, share, and reuse their most successful workflows.
This means Asana can serve as the connective tissue across existing best-of-breed collaboration solutions. Our t emplate library is where users can save, share, and reuse their most successful workflows.
Foreign privacy, data protection, and security laws (including but not limited to the EU GDPR and UK GDPR) impose significant and complex compliance obligations on entities that are subject to those laws.
Also, the CCPA provides for civil penalties and a private right of action for data breaches which may include an award of statutory damages. Foreign privacy, data protection, and security laws (including but not limited to the EU GDPR and UK GDPR) impose significant and complex compliance obligations on entities that are subject to those laws.
Yet there were no products in the market that adequately addressed this pain. As a result of that frustration, they were inspired to create Asana to solve this problem for the world’s teams. Since our inception, over 42 million users have registered on Asana and millions of teams in virtually every country around the world have used Asana.
As there were no products in the market that adequately addressed this, our co-founders were inspired to create Asana to solve this problem for the world’s teams. Since inception, Asana has registered millions of users in over 200 countries and territories.
We are a mission-driven organization first and have designed our values, along with our programs and processes, to help us maximize the potential of every individual in our company. Our values and processes also give us credibility when we share best practices for teamwork in the market and allow us to build those practices into our solution.
Our values and processes also give us credibility when we share best practices for teamwork in the market and allow us to build those practices into our solution.
With Asana, users experience higher productivity and engagement, which has led to rapid adoption across teams, departments, and organizations. As of January 31, 2023, we had over 2.5 million paid users.
Customers rely on Asana to manage everything from goal setting and tracking to capacity planning, product launches, and driving digital transformation. With Asana, users experience higher productivity and engagement, which has led to rapid adoption across teams, departments, and organizations. As of January 31, 2024, we had over 3 million paid users.
We run this analysis at least twice a year in partnership with a third-party pay equity firm. We have a dedicated budget maintained to remediate statistically significant, systematic pay gaps that may be discovered in the course of these studies.
We run this analysis in conjunction with our annual compensation review program conducted with the assistance of a third-party pay equity firm. We thoroughly investigate any inconsistencies identified in this analysis and have a dedicated budget maintained to remediate pay gaps that may be discovered in the course of these studies.
We are a pure play work management company, committed to building the best platform capable of serving organizations of all sizes around the world. With Asana: • Individuals can manage and prioritize across each of their projects to maximize their effectiveness and reduce distractions.
Our Solution We are a pure play work management company, committed to building the best platform capable of serving organizations of all sizes around the world. With Asana: • Individuals can manage their work, from tasks to cross-functional projects and workflows, and see how it ladders up to strategic initiatives and organization-wide goals.
Our platform adds structure to unstructured work, creating clarity, transparency, and accountability to everyone within an organization—individuals, team leads, and executives—so they understand exactly who is doing what, by when. History We started Asana because our co-founders experienced firsthand the growing problem of work about work. While at Facebook, they saw the coordination challenges the company faced as it scaled.
Our secure and scalable platform with AI-powered features adds structure to unstructured work, creating clarity, accountability, and impact for everyone within an organization—executives, department heads, team leads, and individuals—so everyone understands exactly who is doing what, by when, and why. Background Asana was created because our co-founders experienced firsthand the coordination challenges of a growing company.
We provide our software as a service to customers, so the technology we build includes deployment tools to ensure we can publish software updates rapidly and safely, as well as monitoring and automation tools. 16 Table of Contents Commitment to Security and Privacy Upholding the trust that we have established with our customers and gaining the trust of new customers remains a priority for us and as a result, we have implemented robust safeguards to protect the security of customer data.
Commitment to Privacy, Data Protection, and Security Upholding the trust that we have established with our customers and gaining the trust of new customers remains a priority for us and as a result, we have implemented safeguards designed to protect the confidentiality and security of customer data.
Items can be organized, labeled, and dragged and dropped into different categories so that individuals can prioritize their part of a project or any process-related tasks. Individuals can create rules for their own My Tasks to automate tracking their work. My Tasks also integrates with an individual’s existing apps, creating an accurate picture of all in-flight work.
Items can be organized, labeled, and relocated into different categories so that individuals can prioritize their part of a project or any process-related tasks. Individuals can create rules for their own ‘my tasks’ view to automate tracking their work. Inbox Inbox is the notification center for Asana.
Goals can be shared across every level of the organization, while preventing unintended edits with permissions. Customizable views ensure only the most relevant information is given to each teammate. Goals can be kept private or made visible so all team members have clarity on the company’s priorities and see how their work contributes to the organization’s success.
Goals can be shared across every level of the organization, while preventing unintended edits with permissions functionality. Customizable views ensure that only the most relevant information is given to each teammate.
Search criteria can then be saved and easily referenced with just a single click. Integrations Integrations connect applications to Asana, which provides a central hub for managing work. Teams save time by eliminating the need to switch between apps. By providing this centralized hub, Asana ensures that cross-functional work in other tools is tracked and completed.
Teams save time and reduce duplicative efforts by eliminating the need to switch between apps. By providing this centralized hub, Asana ensures that cross-functional work in other tools is tracked and completed.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIf we fail to manage our technical operations infrastructure, or experience service outages, interruptions, or delays in the deployment of our platform, our results of operations may be harmed. We may experience system slowdowns and interruptions from time to time.
Biggest changeIf we enable or offer solutions that draw scrutiny or controversy due to their perceived or actual negative impact on our customers, we may experience brand or reputational harm, competitive disadvantages, consumer complaints, legal liability, and other adverse consequences, any of which could materially adversely affect our business, results of operations, and financial condition. 32 Table of Contents If we fail to manage our technical operations infrastructure, or experience service outages, interruptions, or delays in the deployment of our platform, our results of operations may be harmed.
We derive, and expect to continue to derive, substantially all of our revenues from a single solution. As such, the continued growth in market demand for and market acceptance, including international market acceptance, of our platform is critical to our continued success.
We derive, and expect to continue to derive, substantially all of our revenues from a single solution. We derive, and expect to continue to derive, substantially all of our revenues from a single solution. As such, the continued growth in market demand for and market acceptance, including international market acceptance, of our platform is critical to our continued success.
Any compromise or breach of our security measures, or those of our third-party service providers, could also violate applicable privacy, data protection, data security, and other laws, and cause significant legal and financial exposure, adverse publicity, and a loss of confidence in our security measures, which could have a material adverse effect on our business, results of operations, and financial condition.
Any compromise or breach of our security measures, or those of our third-party service providers, could also violate applicable privacy, data protection, security, and other laws, and cause significant legal and financial exposure, adverse publicity, and a loss of confidence in our security measures, which could have a material adverse effect on our business, results of operations, and financial condition.
Additionally, our contracts may not contain limitations of liability, and even when they do, there can be no assurance that the limitations of liability in our contracts are sufficient to protect us from liabilities, claims, or damages if we fail to comply with applicable obligations related to privacy, data protection, or data security.
Additionally, our contracts may not contain limitations of liability, and even when they do, there can be no assurance that the limitations of liability in our contracts are sufficient to protect us from liabilities, claims, or damages if we fail to comply with applicable obligations related to privacy, data protection, or security.
We receive, process, store, and use business and personal information belonging to individuals who interact with Asana, including our users and prospective, current, and former customers. There are numerous federal, state, local, and foreign laws and regulations regarding privacy, data protection, data security and the storing, sharing, use, processing, disclosure, and protection of business and personal information.
We receive, process, store, and use business and personal information belonging to individuals who interact with Asana, including our users and prospective, current, and former customers. There are numerous federal, state, local, and foreign laws and regulations regarding privacy, data protection, security and the storing, sharing, use, processing, disclosure, and protection of business and personal information.
European privacy, data protection, and data security laws, including the EU GDPR and UK GDPR impose significant and complex burdens on processing personal information, provide for robust regulatory enforcement, and contemplate significant penalties for noncompliance.
European privacy, data protection, and security laws, including the EU GDPR and UK GDPR impose significant and complex burdens on processing personal information, provide for robust regulatory enforcement, and contemplate significant penalties for noncompliance.
The EU GDPR generally restricts the transfer of personal information to countries outside of the EEA, such as the United States, which are not considered by the European Commission to provide an adequate level of privacy, data protection, and data security. In addition, Swiss and UK law contain similar data transfer restrictions as the EU GDPR.
The EU GDPR generally restricts the transfer of personal information to countries outside of the EEA, such as the United States, which are not considered by the European Commission to provide an adequate level of privacy, data protection, and security. In addition, Swiss and UK law contain similar data transfer restrictions as the EU GDPR.
Inability to import personal information to the United States may significantly and negatively impact our business operations, including limiting our ability to collaborate with service providers, contractors, and other companies subject to European and other privacy, data protection, and data security laws; or requiring us to increase our data processing capabilities in Europe or elsewhere at significant expense.
Inability to import personal information to the United States may significantly and negatively impact our business operations, including limiting our ability to collaborate with service providers, contractors, and other companies subject to European and other privacy, data protection, and security laws; or requiring us to increase our data processing capabilities in Europe or elsewhere at significant expense.
In addition to the European Union, a growing number of other global jurisdictions, such as Brazil, Japan, India and Canada, are considering or have passed legislation implementing privacy, data protection, and data security requirements or requiring local storage and processing of data or similar requirements that could increase the cost and complexity of delivering our platform, particularly as we expand our operations internationally.
In addition to the European Union, a growing number of other global jurisdictions, such as Brazil, Japan, India and Canada, are considering or have passed legislation implementing privacy, data protection, and security requirements or requiring local storage and processing of data or similar requirements that could increase the cost and complexity of delivering our platform, particularly as we expand our operations internationally.
Some of these laws, such as the General Data Protection Law in Brazil, or the Act on the Protection of Personal Information in Japan, impose similar obligations as those under the EU GDPR. Domestic privacy, data protection, data security, and consumer protection legislation is also becoming increasingly common in the United States.
Some of these laws, such as the General Data Protection Law in Brazil, or the Act on the Protection of Personal Information in Japan, impose similar obligations as those under the EU GDPR. Domestic privacy, data protection, security, and consumer protection legislation is also becoming increasingly common in the United States.
Individuals, teams, and organizations may be reluctant or unwilling to migrate to work management solutions from spreadsheets, email, messaging, and legacy project management tools. It is difficult to predict adoption rates and demand for our platform, the future growth rate and size of the market for work management solutions, or the entry of competitive offerings.
Individuals and organizations may be reluctant or unwilling to migrate to work management solutions from spreadsheets, email, messaging, and legacy project management tools. It is difficult to predict adoption rates and demand for our platform, the future growth rate and size of the market for work management solutions, or the entry of competitive offerings.
If we cannot implement a valid compliance mechanism for cross-border personal information transfers, we may face increased exposure to regulatory actions, substantial fines, and injunctions against processing or transferring personal information from the EEA or elsewhere.
If we cannot implement a valid compliance mechanism for cross-border personal information transfers, we may face increased exposure to regulatory actions, substantial fines, and injunctions against processing or transferring personal information from the EEA, UK, or elsewhere.
In addition, we will face risks in doing business internationally that could adversely affect our business and results of operations, including: • the need to localize and adapt our platform for specific countries, including translation into foreign languages and associated expenses; • data privacy laws that impose different and potentially conflicting obligations with respect to how personal data is processed or require that customer data be stored in a designated territory; • difficulties in staffing and managing foreign operations; • regulatory and other delays and difficulties in setting up foreign operations; • different pricing environments, longer sales cycles, longer accounts receivable payment cycles, and collections issues; • new and different sources of competition; • weaker protection for intellectual property and other legal rights than in the United States and practical difficulties in enforcing intellectual property and other rights outside of the United States; • laws and business practices favoring local competitors; • compliance challenges related to the complexity of multiple, conflicting, and changing governmental laws and regulations, including employment, tax, privacy, and data protection laws and regulations; 37 Table of Contents • increased financial accounting and reporting burdens and complexities; • declines in the values of foreign currencies relative to the U.S. dollar; • restrictions on the transfer of funds; • potentially adverse tax consequences; • the cost of and potential outcomes of any claims or litigation; • future accounting pronouncements and changes in accounting policies; • changes in tax laws or tax regulations; • health or similar issues, such as a pandemic or epidemic; and • regional and local economic and political conditions, such as global economic downturns or recessions in the regions in which we do business, bank failures, as well as macroeconomic and policy impacts of political instability and armed conflicts.
In addition, we will face risks in doing business internationally that could adversely affect our business and results of operations, including: • the need to localize and adapt our platform for specific countries, including translation into foreign languages and associated expenses; • privacy and data protection laws that impose different and potentially conflicting obligations with respect to how personal information is processed or require that customer data be stored in a designated territory; • difficulties in staffing and managing foreign operations; • regulatory and other delays and difficulties in setting up foreign operations; • different pricing environments, longer sales cycles, longer accounts receivable payment cycles, and collections issues; • new and different sources of competition; • weaker protection for intellectual property and other legal rights than in the United States and practical difficulties in enforcing intellectual property and other rights outside of the United States; • laws and business practices favoring local competitors; • compliance challenges related to the complexity of multiple, conflicting, and changing governmental laws and regulations, including employment, tax, sanctions, privacy, data protection, and security laws and regulations; • increased financial accounting and reporting burdens and complexities; • declines in the values of foreign currencies relative to the U.S. dollar; • restrictions on the transfer of funds; • potentially adverse tax consequences; • the cost of and potential outcomes of any claims or litigation; • future accounting pronouncements and changes in accounting policies; • changes in tax laws or tax regulations; • health or similar issues, such as a pandemic or epidemic; and • regional and local economic and political conditions, such as global economic downturns or recessions in the regions in which we do business, bank failures, as well as macroeconomic and policy impacts of political instability and armed conflicts.
We also publish privacy policies, marketing materials, and other statements, such as compliance with certain certifications or self-regulatory principles, regarding data privacy and security. If these policies, materials or statements are found to be deficient, lacking in transparency, deceptive, unfair, or misrepresentative of our practices, we may be subject to investigation, enforcement actions by regulators, or other adverse consequences.
We also publish privacy policies, marketing materials, and other statements, such as compliance with certain certifications or self-regulatory principles, regarding privacy, data protection, and security. If these policies, materials or statements are found to be deficient, lacking in transparency, deceptive, unfair, or misrepresentative of our practices, we may become subject to investigation, enforcement actions by regulators, or other adverse consequences.
Numerous factors may impede our ability to add new customers, convert individuals, teams, and organizations using our free and trial versions into paying customers, expand usage within organizations, and sell subscriptions to our platform, including but not limited to, our failure to attract and effectively train new sales and marketing personnel, failure to retain and motivate our current sales and marketing personnel, failure to develop or expand relationships with partners, failure to compete effectively against alternative products or services, failure to successfully deploy new features and integrations, failure to provide a quality customer experience and customer support, or failure to ensure the effectiveness of our marketing programs.
Numerous factors may impede our ability to add new customers, convert individuals, teams, and organizations using our free and trial versions into paying customers, expand usage within organizations, and sell subscriptions to our platform, including but not limited to, our failure to attract and effectively train new sales and marketing personnel, failure to retain and motivate our current sales and marketing personnel, failure to develop or expand relationships with partners, failure to compete effectively against alternative products or services, failure to successfully deploy new features and integrations, failure to provide a quality 26 Table of Contents customer experience and customer support, or failure to ensure the effectiveness of our marketing programs.
Demand for our platform is affected by a number of factors, some of which are beyond our control, such as the rate of market adoption of work management solutions; the timing of development and release of competing new products; the development and acceptance of new features, integrations, and capabilities for our platform; price, product, and service changes by us or our competitors; technological changes and developments within the markets we serve; growth, contraction, and rapid evolution of our market; and general economic conditions and trends including a downturn or recession, rising inflation and rising interest rates.
Demand for our platform is affected by a number of factors, some of which are beyond our control, such as the rate of market adoption of work management solutions; the timing of development and release of competing new products; the development and acceptance of new features, integrations, and capabilities for our platform, including features, integrations, or capabilities that utilize AI; price, product, and service changes by us or our competitors; technological changes and developments within the markets we serve; growth, contraction, and rapid evolution of our market; and general economic conditions and trends including a downturn or recession, rising inflation, and rising interest rates.
Our quarterly financial results may fluctuate due to a variety of factors, many of which are outside of our control and may be difficult to predict, including, but not limited to: • the level of demand for our platform; • our ability to grow or maintain our dollar-based net retention rate, expand usage within organizations, and sell subscriptions; • the timing and success of new features, integrations, capabilities, and enhancements by us to our platform, or by our competitors to their products, or any other changes in the competitive landscape of our market; • our ability to achieve widespread acceptance and use of our platform; • errors in our forecasting of the demand for our platform, which would lead to lower revenues, increased costs, or both; • the amount and timing of operating expenses and capital expenditures, as well as entry into operating leases, that we may incur to maintain and expand our business and operations and to remain competitive; • the timing of expenses and recognition of revenues; • security breaches, technical difficulties, or interruptions to our platform; • pricing pressure as a result of competition or otherwise; • adverse litigation judgments, other dispute-related settlement payments, or other litigation-related costs; • the number of new employees hired; • the timing of the grant or vesting of equity awards to employees, directors, or consultants; • seasonal buying patterns for software spending; • declines in the values of foreign currencies relative to the U.S. dollar; • rising global interest rates, which may affect our customers’ spending patterns and our return on investments; 26 Table of Contents • impact of inflation on our costs and on customer spending; • changes in, and continuing uncertainty in relation to, the legislative or regulatory environment; • legal and regulatory compliance costs in new and existing markets; • costs and timing of expenses related to the potential acquisition of businesses, talent, technologies, or intellectual property, including potentially significant amortization costs and possible write-downs; • health epidemics, such as the COVID-19 pandemic, influenza, and other highly communicable diseases or viruses; and • general economic conditions in either domestic or international markets, including geopolitical uncertainty and instability and their effects on software spending.
Our quarterly financial results may fluctuate due to a variety of factors, many of which are outside of our control and may be difficult to predict, including, but not limited to: • the level of demand for our platform; • our ability to grow or maintain our dollar-based net retention rate, expand usage within organizations, and sell subscriptions; • the timing and success of new features, integrations, capabilities, and enhancements by us to our platform, or by our competitors to their products, including the development and deployment of AI driven features, or any other changes in the competitive landscape of our market; • our ability to achieve widespread acceptance and use of our platform; • errors in our forecasting of the demand for our platform, which would lead to lower revenues, increased costs, or both; • the amount and timing of operating expenses and capital expenditures, as well as entry into operating leases, that we may incur to maintain and expand our business and operations and to remain competitive; • the timing of expenses and recognition of revenues; • security breaches, technical difficulties, or interruptions to our platform; • pricing pressure as a result of competition or otherwise; • adverse litigation judgments, other dispute-related settlement payments, or other litigation-related costs; • the number of new employees hired; • the timing of the grant or vesting of equity awards to employees, directors, or consultants; 25 Table of Contents • seasonal buying patterns for software spending; • declines in the values of foreign currencies relative to the U.S. dollar; • rising global interest rates, which may affect our customers’ spending patterns and our return on investments; • impact of inflation on our costs and on customer spending; • changes in, and continuing uncertainty in relation to, the legislative or regulatory environment; • legal and regulatory compliance costs in new and existing markets; • costs and timing of expenses related to the potential acquisition of businesses, talent, technologies, or intellectual property, including potentially significant amortization costs and possible write-downs; • health epidemics, such as influenza, and other highly communicable diseases or viruses; and • general economic conditions in either domestic or international markets, including geopolitical uncertainty and instability and their effects on software spending.
Breaches of our security measures or those of our third-party service providers, including supply chain attacks or other threats to our business operations, could result in unauthorized access to our sites, networks, systems, and accounts; unauthorized access to, and misappropriation of, individuals’ personal information or other confidential or proprietary information of ourselves, our customers, or other third parties; viruses, worms, spyware, or other malware being served from our platform, mobile application, networks, or systems; deletion or modification of content or the display of unauthorized content on our platform; interruption, disruption, or malfunction of operations; costs relating to breach remediation, deployment of additional personnel and protection technologies, and response to governmental investigations and media inquiries and coverage; engagement of third-party experts and consultants; or litigation, regulatory action, and other potential liabilities.
Breaches of our security measures or those of our third-party service providers, including supply chain attacks or other threats to our business operations, could result in unauthorized access to our sites, networks, systems, and accounts; unauthorized access to, and misappropriation of, individuals’ personal information or other sensitive, confidential or proprietary information of ourselves, our customers, or other third parties; viruses, worms, spyware, or other malware being served from our platform, mobile application, networks, or systems; deletion or modification of content or the display of unauthorized content on our platform; interruption, disruption, or malfunction of operations or our ability to provide our services; costs relating to breach remediation, deployment of additional personnel and protection technologies, and response to governmental investigations and media inquiries and coverage; engagement of third-party experts and consultants; or litigation, regulatory action, and other potential liabilities.
Moreover, our business is subscription based, and customers are not obligated to and may not renew their subscriptions after their existing subscriptions expire, and we cannot ensure that customers will renew subscriptions with a similar contract period, with the same or greater number of users, or for the same level of subscription plan or upgrade to Business and Enterprise plans.
Moreover, our business is subscription based, and customers are not obligated to and may not renew their subscriptions after their existing subscriptions expire, and we cannot ensure that customers will renew subscriptions with a similar contract period, with the same or greater number of users, or for the same level of subscription plan or upgrade their subscription plan.
We also cannot be sure that our insurance coverage will be adequate or sufficient to protect us from or to mitigate liabilities arising out of our privacy and security practices, that such coverage will continue to be available on commercially reasonable terms or at all, or that such coverage will pay future claims.
We also cannot be sure that our insurance coverage will be adequate or sufficient to protect us from or to mitigate liabilities arising out of our privacy, data protection, and security practices, that such coverage will continue to be available on commercially reasonable terms or at all, or that such coverage will pay future claims.
Furthermore, the Federal Trade Commission and many state attorneys general continue to enforce federal and state consumer protection laws against companies and individuals for online collection, use, dissemination, and security practices that appear to be unfair or deceptive.
Furthermore, the Federal Trade Commission and many state attorneys general continue to enforce federal and state consumer protection laws against companies and individuals for online data collection, use, dissemination, and security and privacy practices that appear to be unfair or deceptive.
A claim brought against us that is uninsured or underinsured could result in unanticipated costs and could have a material adverse effect on our business, results of operations, and financial condition. Our use of “open source” and third-party software could impose unanticipated conditions or restrictions on our ability to commercialize our solutions and could subject us to possible litigation.
A claim brought against us that is uninsured or underinsured could result in unanticipated costs and could have a material adverse effect on our business, results of operations, and financial condition. 40 Table of Contents Our use of “open source” and third-party software could impose unanticipated conditions or restrictions on our ability to commercialize our solutions and could subject us to possible litigation.
Any failure by us to achieve and sustain profitability would cause the trading price of our Class A common stock to decline. 25 Table of Contents We believe our long-term value as a company will be greater if we focus on growth, which may negatively impact our profitability in the near and medium term.
Any failure by us to achieve and sustain profitability would cause the trading price of our Class A common stock to decline. We believe our long-term value as a company will be greater if we focus on growth, which may negatively impact our profitability in the near and medium term.
Accordingly, we must continue to invest in research and development and in our ongoing efforts to improve and enhance our platform. The success of any enhancement to our platform depends on several factors, including timely completion and delivery, competitive pricing, adequate quality testing, integration with existing technologies, and overall market acceptance.
Accordingly, we must continue to invest in research and development and in our ongoing efforts to improve and enhance our platform. The success of any enhancement to our platform depends on several factors, including timely completion and delivery, competitive pricing and packaging, adequate quality testing, integration with new and existing technologies, including AI, and overall market acceptance.
Any one of these competitive pressures in our market, or our failure to compete effectively, may result in price reductions; fewer customers; reduced revenues, gross profit, and gross margin; increased net losses; and loss of market share. Any failure to meet and address these factors would harm our business, results of operations, and financial condition.
Any one of these competitive pressures in our market, or our failure to compete effectively, may result in price reductions; fewer customers; reduced revenues, gross profit, and gross margin; increased net losses; and loss of 29 Table of Contents market share. Any failure to meet and address these factors would harm our business, results of operations, and financial condition.
Additionally, we seek to expand within organizations by adding new customers, having organizations upgrade to our Business or Enterprise plans, or expanding their use of our platform into other departments within an organization.
Additionally, we seek to expand within organizations by adding new customers, having organizations upgrade to our Advanced, Enterprise or Enterprise+ plans, or expanding their use of our platform into other departments within an organization.
The loss of key personnel, including our co-founder, President, Chief Executive Officer, and Chair, Dustin Moskovitz, and other key members of management, as well as our product development, engineering, sales, and marketing personnel, would disrupt our operations and have an adverse effect on our ability to grow our business.
The loss of key personnel, including our co-founder, President, Chief Executive Officer, and Chair, 34 Table of Contents Dustin Moskovitz, and other key members of management, as well as our product development, engineering, sales, and marketing personnel, would disrupt our operations and have an adverse effect on our ability to grow our business.
Other regions of the world have likewise adopted privacy regulations that may result in increased restrictions on cookie collection and use, and fines for noncompliance. These developments may impact our analytics and advertising activities and our ability to analyze how users interact with our services.
Other regions of the world have likewise adopted privacy regulations that may 42 Table of Contents result in increased restrictions on cookie collection and use, and fines for noncompliance. These developments may impact our analytics and advertising activities and our ability to analyze how users interact with our services.
Our competitors, as well as a number of other entities, including non-practicing entities and individuals, may own or claim to own intellectual property relating to our industry. As we face increasing competition and our public profile increases, the possibility of intellectual property rights claims against us may also increase.
Our competitors, as well as a number of other entities, including non-practicing entities and individuals, may own or claim to own intellectual property relating to our industry. As we face increasing competition and our public profile 38 Table of Contents increases, the possibility of intellectual property rights claims against us may also increase.
Because some patent applications may 40 Table of Contents not be public for a period of time, there is also a risk that we could adopt a technology without knowledge of a pending patent application, which technology would infringe a third-party patent once that patent is issued. We also rely on unpatented proprietary technology.
Because some patent applications may not be public for a period of time, there is also a risk that we could adopt a technology without knowledge of a pending patent application, which technology would infringe a third-party patent once that patent is issued. We also rely on unpatented proprietary technology.
For these purposes, an ownership change generally occurs where the aggregate change in stock ownership by one or more stockholders or groups of stockholders owning at least 5% of a corporation’s stock exceeds more than 50 percentage points over a three-year period.
For these purposes, 45 Table of Contents an ownership change generally occurs where the aggregate change in stock ownership by one or more stockholders or groups of stockholders owning at least 5% of a corporation’s stock exceeds more than 50 percentage points over a three-year period.
For instance, if we do not help organizations on our platform quickly resolve issues and provide effective ongoing user experience at the individual, team, and organizational levels, our ability to convert organizations on our free and trial versions into paying customers will suffer, and our reputation with existing or potential customers will be harmed.
For instance, if we 35 Table of Contents do not help organizations on our platform quickly resolve issues and provide effective ongoing user experience at the individual, team, and organizational levels, our ability to convert organizations on our free and trial versions into paying customers will suffer, and our reputation with existing or potential customers will be harmed.
Any of these events would have a material adverse effect on our business, results of operations, and financial condition. Our failure to obtain or maintain the right to use certain of our intellectual property would negatively affect our business.
Any of these events would have a material adverse effect on our business, results of operations, and financial condition. 39 Table of Contents Our failure to obtain or maintain the right to use certain of our intellectual property would negatively affect our business.
If we (or a third party upon whom we rely) experience a security incident or are perceived to have experienced a security incident, we may experience adverse consequences, such as government enforcement actions (for example, investigations, fines, penalties, audits, and inspections); additional reporting requirements and/or oversight; restrictions on processing confidential, proprietary, and sensitive data (including personal data); litigation (including class claims); indemnification obligations; negative publicity; reputational harm; monetary fund diversions; interruptions in our operations (including availability of data); financial loss; and other similar harms.
If we (or a third party upon whom we rely) experience a security incident or are perceived to have experienced a security incident, we may experience adverse consequences, such as government enforcement actions (for example, investigations, fines, penalties, audits, and inspections); additional reporting requirements and/or oversight; restrictions on processing confidential, proprietary, and sensitive data (including personal information); litigation (including class claims); indemnification obligations; negative publicity; reputational harm; monetary fund 31 Table of Contents diversions; diversion of management attention; interruptions in our operations (including availability of data); financial loss; and other similar harms.
Additionally, if a third-party software provider has incorporated open source software into software that we license from such provider, we could be required to disclose source code that incorporates or is a 41 Table of Contents modification of such licensed software.
Additionally, if a third-party software provider has incorporated open source software into software that we license from such provider, we could be required to disclose source code that incorporates or is a modification of such licensed software.
As of January 31, 2023, we had an accumulated deficit of $1,237.6 million. We do not expect to be profitable in the near future, and we cannot assure you that we will achieve profitability in t he future or that, if we do become profitable, we will sustain profitability.
As of January 31, 2024, we had an accumulated deficit of $1,494.6 million. We do not expect to be profitable in the near future, and we cannot assure you that we will achieve profitability in t he future or that, if we do become profitable, we will sustain profitability.
As a result of these macroeconomic conditions, and any corresponding actions customers may take to manage costs, we may continue to experience a reduction in renewal rates, as well as reduced customer spend and delayed payments that could materially impact our business, results of operations, and financial condition in future periods.
As a result of these macroeconomic conditions, and any corresponding actions customers may take to manage costs, we have experienced and may continue to experience longer sales cycles, and we may continue to experience a reduction in renewal rates, as well as reduced customer spend and delayed payments that could materially impact our business, results of operations, and financial condition in future periods.
Finally, changes in our platform or future changes in Trade Controls, such as those we have seen issued by the United States and other governments in response to the invasion of Ukraine by Russia, could result in our inability to provide our platform to certain customers or decreased use of our platform by existing or potential customers with international operations.
Finally, changes in our platform or future changes in Trade Controls, such as those we have seen issued by the United States and other governments in response to the invasion of Ukraine by Russia and the armed conflict in Israel and the Gaza Strip, could result in our inability to provide our platform to certain customers or decreased use of our platform by existing or potential customers with international operations.
If our efforts to sell to 28 Table of Contents organizations of all sizes are not successful or do not generate additional revenues, our business, results of operations, and financial condition would suffer.
If our efforts to sell to organizations of all sizes are not successful or do not generate additional revenues, our business, results of operations, and financial condition would suffer.
Violations of Trade Controls may subject our company, including responsible personnel, to various adverse consequences, including civil or criminal penalties, government investigations, and loss of export privileges.
Violations of Trade Controls may subject our company, including responsible personnel, to various adverse consequences, including civil or criminal penalties, government investigations, and 44 Table of Contents loss of export privileges.
Generally accepted accounting principles in the United States (“GAAP”) are subject to interpretation by the Financial Accounting Standards Board (“FASB”), the American Institute of Certified Public Accountants, the Securities and Exchange Commission, or the SEC, and various bodies formed to promulgate and interpret appropriate accounting principles.
Generally accepted accounting principles in the United States are subject to interpretation by the Financial Accounting Standards Board (“FASB”), the American Institute of Certified Public Accountants, the Securities and Exchange Commission (“SEC”), and various bodies formed to promulgate and interpret appropriate accounting principles.
Sales to customers outside the United States and our international operations expose us to risks inherent in international sales and operations. For the fiscal year ended January 31, 2023, 40% of our revenues were generated from customers outside the United States. We have operations in multiple cities globally.
Sales to customers outside the United States and our international operations expose us to risks inherent in international sales and operations. For the fiscal year ended January 31, 2024, 39% of our revenues were generated from customers outside the United States. We have operations in multiple cities globally.
We expect to continue to make future investments and expenditures related to the growth of our business, including: • strategic investment in our sales and marketing activities; • continued investments in research and development to introduce new features and enhancements to our platform; • hiring employees necessary to support our goals; • investments in infrastructure; • leveraging our operations across our multiple geographies; and • costs associated with our general and administrative organization.
We expect to continue to make future investments and expenditures related to the growth of our business, including: • strategic investment in our sales and marketing activities; • continued investments in research and development to introduce new features and enhancements to our platform, including integration of AI in our product; • hiring employees necessary to support our goals; • investments in infrastructure; • leveraging our operations across our multiple geographies; and 24 Table of Contents • costs associated with our general and administrative organization.
Applicable privacy and information security obligations may also require us to notify relevant stakeholders, such as governmental authorities, partners, and affected individuals, of security breaches or incidents. Such notifications may involve inconsistent requirements and are costly, and the notifications or the failure to comply with such requirements could lead to adverse consequences.
Applicable privacy, data protection, and security obligations may also require us to notify relevant stakeholders, such as governmental authorities, partners, customers, investors, and affected individuals, of security breaches or incidents. Such notifications may involve inconsistent requirements and are costly, and the notifications or the failure to comply with such requirements could lead to adverse consequences.
If any of these new or improved controls and systems do not perform as expected, we may experience material weaknesses in our controls. In addition to our results determined in accordance with GAAP, we believe certain non-GAAP measures may be useful in evaluating our operating performance.
If any of these new or improved controls and systems do not perform as expected, we may experience material weaknesses in our controls. In addition to our results determined in accordance with generally accepted accounting principles (“GAAP”), we believe certain non-GAAP measures may be useful in evaluating our operating performance.
On November 7, 2022, we entered into a credit agreement (the “Credit Agreement”) with several banks and other financial institutions or entities for which Silicon Valley Bank (“SVB”) acted as issuing lender, administrative agent and collateral agent, under which we may incur loans in an aggregate principal amount not to exceed $150 46 Table of Contents million, consisting of a term loan facility in an aggregate principal amount equal to $50 million and a revolving loan facility in an aggregate principal amount of up to $100 million, including a $30 million letter of credit sub-facility (collectively, the “November 2022 Senior Secured Credit Facility”).
On November 7, 2022, we entered into an agreement with several banks and other financial institutions or entities for which Silicon Valley Bank (“SVB”) acted as issuing lender, administrative agent and collateral agent, under which we may incur loans in an aggregate principal amount not to exceed $150 million, consisting of a term loan facility in an aggregate principal amount equal to $50 million and a revolving loan facility in an aggregate principal amount of up to $100 million, including a $30 million letter of credit sub-facility (collectively and as amended on April 13, 2023, the “November 2022 Senior Secured Credit Facility”).
Additionally, the Credit Agreement includes customary conditions to borrowing and covenants, including restrictions on our ability to incur liens, incur indebtedness, make or hold investments, execute certain change of control transactions, business combinations or other fundamental changes to the business, dispose of assets, make certain types of restricted payments or enter into certain related party transactions, subject to customary exceptions.
Additionally, the November 2022 Senior Secured Credit Facility includes customary conditions to borrowing and covenants, including restrictions on our ability to incur liens, incur indebtedness, make or hold investments, execute certain change of control transactions, business combinations or other fundamental changes to the business, dispose of assets, make certain types of restricted payments or enter into certain related party transactions, subject to customary exceptions.
We cannot assure you that the marketplaces through which we distribute our mobile application will maintain their current structures or that such marketplaces will not charge us 36 Table of Contents fees to list our application for download.
We cannot assure you that the marketplaces through which we distribute our mobile application will maintain their current structures or that such marketplaces will not charge us fees to list our application for download.
We believe that our ability to compete depends upon many factors both within and beyond our control, including the following: • adaptability of our platform to a broad range of use cases; • continued market acceptance of our platform and the timing and market acceptance of new features and enhancements to our platform or the offerings of our competitors; • ease of use, performance, price, security, and reliability of solutions developed either by us or our competitors; 30 Table of Contents • our brand strength; • selling and marketing efforts, including our ability to grow our market share domestically and internationally; • the size and diversity of our customer base; • customer support efforts; and • our ability to continue to create easy to use integrations for, and robust, effective partnerships with, other larger enterprise software solutions and tools.
We believe that our ability to compete depends upon many factors both within and beyond our control, including the following: • rapid developments in our technology, including the successful deployment of AI in our product; • adaptability of our platform to a broad range of use cases; • continued market acceptance of our platform and the timing and market acceptance of new features and enhancements to our platform or the offerings of our competitors; • ease of use, performance, price, security, and reliability of solutions developed either by us or our competitors; • our brand strength; • selling and marketing efforts, including our ability to grow our market share domestically and internationally; • the size and diversity of our customer base; • customer support efforts; and • our ability to continue to create easy to use integrations for, and robust, effective partnerships with, other larger enterprise software solutions and tools.
If work management solutions do not achieve widespread adoption, or there is a reduction in demand for work management solutions caused by a lack of customer acceptance, technological challenges, weakening economic conditions, security or privacy concerns, competing technologies and products, decreases in corporate spending, or otherwise, it could result in decreased revenues, and our business, results of operations, and financial condition would be adversely affected.
If work management solutions do not achieve widespread adoption, or there is a reduction in demand for work management solutions caused by a lack of customer acceptance, technological challenges including the successful integration of AI in our product, weakening economic conditions, privacy, data protection, or security concerns, competing technologies and products, decreases in corporate spending, or otherwise, it could result in decreased revenues, and our business, results of operations, and financial condition would be adversely affected.
We present certain non-GAAP financial measures in this 47 Table of Contents Annual Report on Form 10-K and intend to continue to present certain non-GAAP financial measures in future filings with the SEC and other public statements.
We present certain non-GAAP financial measures in this Annual Report on Form 10-K and intend to continue to present certain non-GAAP financial measures in future filings with the SEC and other public statements.
We believe our revenue growth depends on a number of factors, including, but not limited to, our ability to: • attract new individuals, teams, and organizations as customers; • grow or maintain our dollar-based net retention rate, expand usage within organizations, and sell subscriptions; • price our subscription plans effectively; • convert individuals, teams, and organizations on our free and trial versions into paying customers; • achieve widespread acceptance and use of our platform, including in markets outside of the United States; • strategically expand our sales force and leverage our existing sales capacity; • expand the features and capabilities of our platform; • provide excellent customer experience and customer support; • maintain the security and reliability of our platform; • successfully compete against established companies and new market entrants, as well as existing software tools; and 24 Table of Contents • increase awareness of our brand on a global basis.
We believe our revenue growth depends on a number of factors, including, but not limited to, our ability to: • attract new individuals, teams, and organizations as customers; • grow or maintain our dollar-based net retention rate, expand usage within organizations, and sell subscriptions; • price and package our subscription plans effectively; • convert individuals, teams, and organizations on our free and trial versions into paying customers; • achieve widespread acceptance and use of our platform, including in markets outside of the United States; 23 Table of Contents • strategically expand our direct sales force and leverage our existing sales capacity; • expand the features and capabilities of our platform, including the successful deployment of AI features in our product; • provide excellent customer experience and customer support; • maintain the security, privacy, and reliability of our platform or systems that process confidential data; • successfully compete against established companies and new market entrants, as well as existing software tools; and • increase awareness of our brand on a global basis.
We have a history of losses, and we may not be able to achieve profitability or, if achieved, sustain profitability. We have incurred net losses in each fiscal year since our founding. We generated net losses of $407.8 million and $288.3 million for the fiscal years ended January 31, 2023 and January 31, 2022, respectively.
We have a history of losses, and we may not be able to achieve profitability or, if achieved, sustain profitability. We have incurred net losses in each fiscal year since our founding. We generated net losses of $257.0 million and $407.8 million for the fiscal years ended January 31, 2024 and January 31, 2023, respectively.
If we do not succeed in attracting 35 Table of Contents excellent personnel or retaining or motivating existing personnel, we may be unable to innovate quickly enough to support our business model or grow effectively.
If we do not succeed in attracting excellent personnel or retaining or motivating existing personnel, we may be unable to innovate quickly enough to support our business model or grow effectively.
Operating in international markets requires significant resources and management attention and subjects us to regulatory, economic, and political risks that are different from those in the United States.
Operating in international markets requires significant resources and management attention and subjects us to regulatory, economic, and political risks that are different 36 Table of Contents from those in the United States.
To increase our revenues and achieve profitability, we must increase our customer base through various methods, including but not limited to, adding new customers, converting individuals, teams, and organizations using our free and trial versions into paying customers, and expanding usage within organizations.
To increase our revenues and achieve profitability, we must increase our customer base through various methods, including but not limited to, adding new customers, converting individuals, teams, and organizations using our free and trial versions into paying customers, and expanding usage within organizations. We encourage customers on our free and trial versions to upgrade to paid subscription plans.
We are subject to stringent and evolving U.S. and foreign laws, regulations, rules, contractual obligations, policies and other obligations related to privacy, data protection, and security.
We are subject to stringent and evolving U.S. and foreign laws, regulations, rules, contractual obligations, industry standards, policies and other obligations related to artificial intelligence, privacy, data protection, and security.
Our operating activities may be restricted as a result of covenants related to the indebtedness under our Credit Agreement, and we may be required to repay the outstanding indebtedness in an event of default, which would have an adverse effect on our business.
Our operating activities may be restricted as a result of covenants related to the indebtedness under our November 2022 Senior Secured Credit Facility, and we may be required to repay the outstanding indebtedness in an event of default, which would have an adverse effect on our business.
Ransomware attacks, including those perpetrated by organized criminal threat actors, nation-states, and nation-state-supported actors, are becoming increasingly prevalent and severe and can lead to significant interruptions in our operations, loss of confidential, proprietary, and sensitive data and income, reputational harm, and diversion of funds.
Ransomware attacks, including those perpetrated by organized criminal threat actors, nation-states, and nation-state-supported actors, are becoming increasingly prevalent and severe and can lead to significant interruptions in our operations and our ability to provide our products or services, loss of confidential, proprietary, and sensitive information and income, reputational harm, and diversion of funds.
Additionally, as we focus on increasing our sales to larger organizations, we will be required to deploy sophisticated and costly sales efforts, which may result in longer sales cycles. Sales efforts targeted at larger customers typically involve greater costs, longer sales cycles, greater competition, and less predictability in completing some of our sales.
Additionally, as we focus on increasing our sales to larger organizations, we will be required to deploy sophisticated and costly sales efforts, which may result in longer sales cycles, greater competition, and less predictability in completing some of our sales.
In addition, the Credit Agreement contains financial covenants that require us to maintain a consolidated adjusted quick ratio of 1.25 to 1.00, as well as a minimum cash adjusted EBITDA, each tested on a quarterly basis.
In addition, the November 2022 Senior Secured Credit Facility contains financial covenants that require us to maintain a consolidated adjusted quick ratio of 1.25 to 1.00, as well as a minimum cash adjusted EBITDA, each tested on a quarterly basis.
In addition, our future growth rate is subject to a number of uncertainties, such as general macroeconomic and market conditions, including those caused by the COVID-19 pandemic, rising interest rates, inflation, actual or anticipated banking failures, instability in financial markets, and economic downturns or recessions in the regions in which we do business.
In addition, our future growth rate is subject to a number of uncertainties, such as general macroeconomic and market conditions, including rising interest rates, inflation, actual or anticipated bank failures, instability in financial markets, and economic downturns or recessions in the regions in which we do business.
To the extent that increasing numbers of these individuals, teams, and organizations do not become, or lead others to become, paying customers, we will not realize the intended benefits of this marketing strategy, we will continue to pay the costs associated with hosting such free and trial versions, our ability to grow our business will be harmed, and our business, results of operations, and financial condition will suffer. 29 Table of Contents We derive, and expect to continue to derive, substantially all of our revenues from a single solution.
To the extent that increasing numbers of these individuals, teams, and organizations do not become, or lead others to become, paying customers, we will not realize the intended benefits of this marketing strategy, we will continue to pay the costs associated with hosting such free and trial versions, our ability to grow our business will be harmed, and our business, results of operations, and financial condition will suffer.
Our independent registered public accounting firm is required to formally attest to the effectiveness of our internal control over financial reporting and may issue a report that is adverse in the event it is not satisfied with the level at which our internal control over financial reporting is documented, designed, or operating.
We are required to provide an annual management report on the effectiveness of our internal control over financial reporting. 47 Table of Contents Our independent registered public accounting firm is required to formally attest to the effectiveness of our internal control over financial reporting and may issue a report that is adverse in the event it is not satisfied with the level at which our internal control over financial reporting is documented, designed, or operating.
We are subject to anti-corruption and anti-bribery and similar laws, such as the U.S. Foreign Corrupt Practices Act of 1977, as amended (“FCPA”), the U.S. domestic bribery statute contained in 18 U.S.C. § 201, U.S. Travel Act, the USA PATRIOT Act, the U.K.
We are subject to anti-corruption and anti-bribery and similar laws, such as the U.S. Foreign Corrupt Practices Act of 1977, as amended, the U.S. domestic bribery statute contained in 18 U.S.C. § 201, U.S. Travel Act, the USA PATRIOT Act, the U.K. Bribery Act 2010, and other anti-corruption, anti-bribery, and anti-money laundering laws in countries in which we conduct activities.
The Credit Agreement contains customary events of default relating to, among other things, payment defaults, breach of covenants, cross acceleration to material indebtedness, bankruptcy-related defaults, judgment defaults, and the occurrence of certain change of control events.
The November 2022 Senior Secured Credit Facility contains customary events of default relating to, among other things, payment defaults, breach of covenants, cross acceleration to material indebtedness, bankruptcy-related defaults, judgment defaults, and the occurrence of certain change of 46 Table of Contents control events.
General Risks Our reported financial results may be adversely affected by changes in accounting principles generally accepted in the United States.
Our business may be adversely affected by these restrictions on our ability to operate our business. General Risks Our reported financial results may be adversely affected by changes in accounting principles generally accepted in the United States.
Our recruiting efforts may also be limited by laws and regulations, such as restrictive immigration laws, and restrictions on travel imposed by certain governments, as well as delays in processing or a lack of availability of visas.
Our recruiting efforts may also be limited by laws and regulations, such as restrictive immigration laws, and restrictions on travel imposed by certain governments, as well as delays in processing or a lack of availability of visas. In addition, our past and future restructuring efforts may adversely affect our ability to attract and retain employees.
Our business will be harmed if any provider of such software systems: • discontinues or limits our access to its software or APIs; • modifies its terms of service or other policies, including fees charged to, or other restrictions on us, or other application developers; • changes how information is accessed by us or our customers; • establishes more favorable relationships with one or more of our competitors; or • develops or otherwise favors its own competitive offerings over our platform. 34 Table of Contents Third-party services and products are constantly evolving, and we may not be able to modify our platform to assure its compatibility with that of other third parties.
Our business will be harmed if any provider of such software systems: • discontinues or limits our access to its software or APIs; • modifies its terms of service or other policies, including fees charged to, or other restrictions on us, or other application developers; • changes how information is accessed by us or our customers; • establishes more favorable relationships with one or more of our competitors; or • develops or otherwise favors its own competitive offerings over our platform.
We have experienced rapid growth in recent periods. In future periods, we expect our revenue growth rate to decline. Further, as we operate in a new and rapidly changing category of work management software, widespread acceptance and use of our platform is critical to our future growth and success.
We have experienced rapid growth in recent periods and we may not be able to achieve similar revenue growth rates in the future. Further, as we continue to operate in a new and rapidly changing category of work management software, widespread acceptance and use of our platform is critical to our future growth and success.
We are required to manage multiple relationships with various strategic partners, customers, and other third parties. In the event of further growth of our operations or in the number of our third-party relationships, our systems, procedures, or internal controls may not be adequate to support our operations, and our management may not be able to manage such growth effectively.
In the event of further growth of our operations or in the number of our third-party relationships, our systems, procedures, or internal controls may not be adequate to support our operations, and our management may not be able to manage such growth effectively.
If we fail to meet or exceed such expectations for these or any other reasons, the trading price of our Class A common stock would fall, and we would face costly litigation, including securities class action lawsuits.
If we fail to meet or exceed such expectations for these or any other reasons, the trading price of our Class A common stock would fall, and we would face costly litigation, including securities class action lawsuits. We may not be able to effectively manage our growth. We have experienced rapid growth and increased demand for our platform.
Any of these events would cause our business and results of operations to be materially and adversely affected as a result. 39 Table of Contents We are also frequently required to indemnify our reseller partners and customers in the event of any third-party infringement claims against our customers and third parties who offer our platform, and such indemnification obligations may be excluded from contractual limitation of liability provisions that limit our exposure.
We are also frequently required to indemnify our reseller partners and customers in the event of any third-party infringement claims against our customers and third parties who offer our platform, and such indemnification obligations may be excluded from contractual limitation of liability provisions that limit our exposure.
Such incidents could include, but are not limited to, cyber attacks, software bugs and vulnerabilities, server malfunctions, software or hardware failures, malicious code, malware, viruses, social engineering (including phishing), ransomware, supply chain attacks and vulnerabilities through our third-party partners, denial-of-service attacks, credential stuffing, credential harvesting, loss of data or other information technology assets, adware, telecommunications failures, earthquakes, fires, floods, and other similar threats, efforts by individuals or groups of hackers and sophisticated organizations, including state-sponsored organizations, errors or malfeasance of our personnel, misconfiguration, and security vulnerabilities in the software or systems on which we rely.
Such incidents could include, but are not limited to, cyber-attacks, software bugs and vulnerabilities, malicious internet-based activity, online and offline fraud, server malfunctions, software or hardware failures, malicious code, malware (including as a result of advanced persistent threat intrusion), viruses, social engineering (including through deep fakes, which may become increasingly more difficult to identify, and phishing attacks), ransomware, supply chain attacks and vulnerabilities through our third-party partners, denial-of-service attacks, credential stuffing, credential harvesting, loss of data or other information technology assets, adware, telecommunications failures, earthquakes, fire, floods, attacks enhanced or facilitated by AI, and other similar threats, efforts by individuals or groups of hackers and sophisticated organizations, including state-sponsored organizations, threat actors, “hacktivists,” organized criminal threat actors, errors or malfeasance of our personnel, misconfiguration, and security vulnerabilities in the software or systems on which we rely.
If we fail to predict customer demands, fail to sufficiently account for the impact of macroeconomic conditions on our sales projections, or fail to attract new customers and maintain and expand new and existing customer relationships, our revenues may grow more slowly than expected, may not grow at all, or may decline, and our business may be harmed.
If we fail to predict customer demands, fail to sufficiently account for the impact of macroeconomic conditions on our sales projections, or fail to attract new customers and maintain and expand new and existing customer relationships, our revenues may grow more slowly than expected, may not grow at all, or may decline, and our business may be harmed. 27 Table of Contents One of our marketing strategies is to offer free and trial subscription plans, and we may not be able to continue to realize the benefits of this strategy.
We collect sales taxes and value added taxes in a number of jurisdictions. One or more states or countries may seek to impose incremental or new sales, use, value added, or other tax collection obligations on us.
One or more states or countries may seek to impose incremental or new sales, use, value added, or other tax collection obligations on us.
Our competitors may also offer their products and services at a lower price, may offer price concessions, delayed payment terms, financing terms, or other terms and conditions that are more enticing to potential customers.
In addition, some of our potential customers may elect to develop their own internal applications for their work management needs. Our competitors may also offer their products and services at a lower price, may offer price concessions, delayed payment terms, financing terms, or other terms and conditions that are more enticing to potential customers.
In addition, any transition of the cloud services currently provided by AWS to another cloud services provider would require significant time and expense and could disrupt or degrade delivery of our platform.
Any significant disruption of, limitation of our access to, or other interference with our use of AWS would negatively impact our operations and could seriously harm our business. In addition, any transition of the cloud services currently provided by AWS to another cloud services provider would require significant time and expense and could disrupt or degrade delivery of our platform.
Foreign privacy, data protection, and data security laws have become more stringent in recent years, are undergoing a period of rapid change, and may increase the costs and complexity of offering our products and 42 Table of Contents services in new and existing geographies.
We could also incur significant costs investigating and defending such claims and, if we are found liable, significant damages. Foreign privacy, data protection, and security laws have become more stringent in recent years, are undergoing a period of rapid change, and may increase the costs and complexity of offering our products and services in new and existing geographies.
Any new features, integrations, and capabilities that we develop may not be introduced in a timely or cost-effective manner, may contain errors, failures, vulnerabilities, or bugs, or may not achieve the market acceptance necessary to generate significant revenues.
Any new features, integrations, and capabilities that we develop may not be introduced in a timely or cost-effective manner, may contain errors, failures, vulnerabilities, or bugs, or may not achieve the market acceptance necessary to generate significant revenues. We may have limited insight into the privacy, data protection, or security practices of third-party data suppliers for our AI algorithms.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe may procure additional space in the future if we add employees or expand geographically. We believe our facilities are adequate and suitable for our current needs and that, should it be needed, suitable additional or alternative space will be available to accommodate our operations. 54 Table of Contents
Biggest changeWe may procure additional space in the future if we add employees or expand geographically. We believe our facilities are adequate and suitable for our current needs and that, should it be needed, suitable additional or alternative space will be available to accommodate our operations. 55 Table of Contents

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed1 unchanged
Biggest changeWe are not presently a party to any litigation the outcome of which, we believe, if determined adversely to us, would individually or taken together have a material adverse effect on our business, operating results, cash flows or financial condition. Item 4. Mine Safety Disclosures Not applicable. 55 Table of Contents PART II
Biggest changeWe are not presently a party to any litigation the outcome of which, we believe, if determined adversely to us, would individually or taken together have a material adverse effect on our business, operating results, cash flows or financial condition. Item 4. Mine Safety Disclosures Not applicable. 56 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

3 edited+161 added−3 removed7 unchanged
Biggest changeAs discussed above, we have never declared or paid a cash dividend on our Class A common stock and do not anticipate declaring or paying a cash dividend in the foreseeable future. 56 Table of Contents Unregistered Sales of Equity Securities None.
Biggest changeAs discussed above, we have never declared or paid a cash dividend on our Class A common stock and do not anticipate declaring or paying a cash dividend in the foreseeable future. 57 Table of Contents Unregistered Sales of Equity Securities None. Issuer Purchase of Equity Securities None. Item 6. [Reserved] 58 Table of Contents Item 7.
The following graph compares (i) the cumulative total stockholder return on our Class A common stock from September 30, 2020 (the date our Class A common stock commenced trading on the NYSE) through January 31, 2023 with (ii) the cumulative total return of the Standard & Poor's (S&P) 500 Index and the Standard & Poor’s Information Technology Index over the same period, assuming the investment of $100 in our Class A common stock and in both of the other indices on September 30, 2020 and the reinvestment of dividends.
The following graph compares (i) the cumulative total stockholder return on our Class A common stock from September 30, 2020 (the date our Class A common stock commenced trading on the NYSE) through January 31, 2024 with (ii) the cumulative total return of the Standard & Poor's (S&P) 500 Index and the Standard & Poor’s Information Technology Index over the same period, assuming the investment of $100 in our Class A common stock and in both of the other indices on September 30, 2020 and the reinvestment of dividends.
Since August 26, 2021, our Class A common stock has also been listed on the LTSE under the symbol “ASAN.” Holders of Record As of March 1, 2023, we had 126 holders of record of our Class A common stock and 14 holders of record of our Class B common stock.
Since August 26, 2021, our Class A common stock has also been listed on the LTSE under the symbol “ASAN.” Holders of Record As of March 1, 2024, we had 122 holders of record of our Class A common stock and 14 holders of record of our Class B common stock.
Removed
Issuer Purchase of Equity Securities The following table contains information relating to the repurchases of our common stock made by us in the three months ended January 31, 2023.
Added
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the consolidated financial statements and related notes appearing elsewhere in this Annual Report on Form 10-K.
Removed
Period Total Number of Shares Purchased 1 Average Price Paid per Share November 1 - November 30, 2022 960 $ 6.34 December 1 - December 31, 2022 86 $ 3.70 January 1 - January 31, 2023 84 $ 3.70 Total 1,130 $ 5.95 __________________ 1 Represents shares of unvested Class A common stock that were repurchased by us from former employees upon termination of employment in accordance with the terms of the employees’ stock option agreements.
Added
As described in the section titled “Special Note Regarding Forward-Looking Statements,” the following discussion and analysis contains forward ‑ looking statements that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove correct, could cause our results to differ materially from those expressed or implied by such forward-looking statements.
Removed
We purchased the shares from the former employees at the respective original exercise prices.
Added
Factors that could cause or contribute to such differences include, but are not limited to, those identified below and those discussed in the section titled “Risk Factors” included above in this report. Our fiscal year ends on January 31.
Added
Overview Asana is a leading work management software platform with an enterprise focus that helps organizations drive strategic initiatives and automate work in one place. Over 150,000 paying customers use Asana to automate complex operational workflows like product launches and employee onboarding, resource planning, tracking company-wide strategic initiatives and more.
Added
Our secure and scalable platform with AI-powered features adds structure to unstructured work, creating clarity, accountability, and impact for everyone within an organization—executives, department heads, team leads, and individuals—so everyone understands exactly who is doing what, by when, and why. Asana is flexible and applicable to virtually any use case across departments and organizations of all sizes.
Added
We designed our platform to be easy to use and intuitive to all users, regardless of role or technical proficiency. Our platform allows users to work the way they want with the interface that is right for them, using lists, calendars, boards, timelines, and workload, all while providing trusted scalability and reliability. We have experienced rapid growth in recent periods.
Added
Our revenues were $652.5 million, $547.2 million, and $378.4 million for fiscal 2024, fiscal 2023, and fiscal 2022, respectively, representing growth of 19% and 45% for fiscal 2024 and f iscal 2023, respectively . As of January 31, 2024 , we had 1,840 employees, representing growth of 3% since January 31, 2023.
Added
We had a net loss of $257.0 million, $407.8 million, and $288.3 million for fiscal 2024, fiscal 2023, and fiscal 2022, respectively . Since our inception, over 55.0 million users have registered on Asana and millions of teams in virtually every country around the world have used Asana. As of January 31, 2024, we had over 3 million paid users.
Added
Key Business Metrics We believe that our growth and financial performance are dependent upon many factors, including the key factors described below.
Added
Paying Customers We are focused on continuing to grow the number of customers that use our platform, and specifically on growing the number of customers spending over $5,000 on an annualized basis (“Core customers”), and those spending over $100,000 on an annualized basis.
Added
Our operating results and growth opportunity depend, in part, on our ability to attract new customers and scale within those same organizations. We believe we have significant greenfield opportunities among addressable customers worldwide and we will continue to invest in our research and development and our sales and marketing organizations to address this opportunity.
Added
We define a customer as a distinct account, which could include a team, company, educational or government institution, organization, or distinct business unit of a company, that is on a paid subscription plan, a free version, or a free trial of one of our paid subscription plans. A single organization may have multiple customers.
Added
We define a paying customer as a customer on a paid subscription plan. We define customers spending over $5,000 and $100,000 as those organizations on a paid subscription plan that had $5,000 or more or $100,000 or more in annualized GAAP revenues in a given quarter, respectively, inclusive of 59 Table of Contents discounts.
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As customers realize the productivity benefits we provide, our platform often becomes critical to managing their work and achieving their objectives, which drives further adoption and expansion opportunities, and results in higher annualized contract values.
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We believe that our ability to increase the number of these customers is an important indicator of the components of our business, including: the continued acquisition of new customers, retaining and expanding our user base within existing customers, our continued investment in product development and functionality required by larger organizations, and the strategic expansion of our direct sales force.
Added
As of January 31, 2024, we had 21,646 Core customers contributing approximately 71% of revenues for the fiscal year then ended. As of January 31, 2023, we had 19,432 Core customers who contributed approximately 70% of revenue for the fiscal year then ended.
Added
As of January 31, 2024 and 2023, we had 607 and 506 customers spending over $100,000 on an annualized basis, respectively. Dollar-based Net Retention Rate We expect to derive a portion of our revenue growth from expansion within our existing customer base, where we have an opportunity to expand adoption of Asana across teams, departments, and organizations.
Added
We believe that our dollar-based net retention rate demonstrates our opportunity to further expand within our existing customer base, particularly those that generate higher levels of annual revenues. Our reported dollar-based net retention rate equals the simple arithmetic average of our quarterly dollar-based net retention rate for the four quarters ending with the most recent fiscal quarter.
Added
We calculate our dollar-based net retention rate by comparing our revenues from the same set of customers in a given quarter, relative to the comparable prior-year period. To calculate our dollar-based net retention rate for a given quarter, we start with the revenues in that quarter from customers that generated revenues in the same quarter of the prior year.
Added
We then divide that amount by the revenues attributable to that same group of customers in the prior-year quarter. Current period revenues include any upsells and are net of contraction or attrition over the trailing 12 months, but exclude revenues from new customers in the current period.
Added
We expect our dollar-based net retention rate to fluctuate due to a number of factors, including the expected growth of our revenue base, the level of penetration within our customer base, our ability to retain our customers, and the macroeconomic environment.
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For example, current macroeconomic headwinds have impacted customers’ renewal decisions and we expect this trend to continue into fiscal year 2025. As of January 31, 2024 and 2023, our dollar-based net retention rate was over 100% and over 115%, respectively.
Added
As of January 31, 2024 and 2023, our dollar-based net retention rate for our Core customers was 105% and over 120%, respectively. Our dollar-based net retention rate for customers spending over $100,000 on an annualized basis for the same periods was 115% and over 135%, respectively. Current Economic Conditions Global macroeconomic events including elevated inflation, the U.S.
Added
Federal Reserve raising interest rates, bank failures, supply chain disruptions, fluctuations in currency exchange rates, and geopolitical unrest have led to economic uncertainty. These macroeconomic conditions have and are likely to continue to have adverse effects on the rate of global IT spending, including the buying patterns of our customers and prospective customers, and the length of our sales cycles.
Added
While the current macroenvironment is challenging and may continue for the near term, we are encouraged by the future of work that we are building at Asana, where every organization can work from a shared system driving clarity and accountability powered by the Asana platform.
Added
Components of Results of Operations Revenues We generate subscription revenues from paying customers accessing our cloud-based platform. Subscription revenues are driven primarily by the number of paying customers, the number of paying users within the customer 60 Table of Contents base, and the level of subscription plan.
Added
We recognize revenues ratably over the related contractual term beginning on the date that the platform is made available to a customer. Due to the ease of implementation of our platform, revenues from professional services have been immaterial to date.
Added
Cost of Revenues Cost of revenues consists primarily of the cost of providing our platform to free users and paying customers and is comprised of third-party hosting fees, personnel-related expenses for our operations and support personnel including allocated overhead costs for facilities and shared IT-related expenses, third-party implementation services partner fees, credit card processing fees, and amortization of our capitalized internal-use software costs.
Added
As we acquire new customers and existing customers increase their use of our cloud-based platform, we expect that our cost of revenues will continue to increase.
Added
Gross Profit and Gross Margin Gross profit, or revenues less cost of revenues, and gross margin, or gross profit as a percentage of revenues, has been and will continue to be affected by various factors, including the timing of our acquisition of new customers, renewals of and follow-on sales to existing customers, costs associated with operating our cloud-based platform, and the extent to which we expand our operations and customer support organizations.
Added
We expect our gross profit to increase in dollar amount and our subscription gross margin to remain relatively consistent over the long term. Operating Expenses Our operating expenses consist of research and development, sales and marketing, and general and administrative expenses.
Added
Personnel-related expenses are the most significant component of operating expenses and consist of salaries, employer payroll taxes, benefits, stock-based compensation expense, and, in the case of sales and marketing expenses, sales commissions. Operating expenses also include an allocation of overhead costs for facilities and shared IT-related expenses, including depreciation expense.
Added
Research and Development Research and development expenses consist primarily of personnel-related expenses. These expenses also include product design costs, third-party services and consulting expenses, software subscriptions and computer equipment used in research and development activities, and allocated overhead costs.
Added
A substantial portion of our research and development efforts are focused on enhancing our software architecture and adding new features and functionality to our platform.
Added
We anticipate continuing to invest in innovation and technology development, and as a result, we expect research and development expenses to continue to increase in dollar amount but to decrease as a percentage of revenues over time.
Added
Sales and Marketing Sales and marketing expenses consist primarily of personnel-related expenses and expenses for performance marketing, brand marketing, pipeline generation, and sponsorship activities. These expenses also include allocated overhead costs and travel-related expenses.
Added
Sales commissions earned by our sales force that are considered incremental and recoverable costs of obtaining a subscription with a customer are deferred and amortized on a straight-line basis over the expected period of benefit of three years.
Added
We continue to make strategic investments in our sales and marketing organization, and we expect sales and marketing expenses to remain our largest operating expense in dollar amount.
Added
We expect our sales and marketing expenses to continue to increase in dollar amount but to decrease as a percentage of revenues over time, although the percentage may fluctuate from quarter to quarter and year to year depending on the extent and timing of our initiatives. 61 Table of Contents General and Administrative General and administrative expenses consist primarily of personnel-related expenses for our finance, human resources, information technology, and legal organizations.
Added
These expenses also include non-personnel costs, such as outside legal, accounting, and other professional fees, software subscriptions and expensed computer equipment, certain tax, license, and insurance-related expenses, and allocated overhead costs. We have recognized and will continue to recognize certain expenses as part of being a publicly traded company, consisting of professional fees and other expenses.
Added
As a public company, we incur additional costs associated with accounting, compliance, insurance, and investor relations.
Added
We expect our general and administrative expenses to continue to increase in dollar amount for the foreseeable future but to generally decrease as a percentage of our revenues, although the percentage may fluctuate from period to period depending on the timing and amount of our general and administrative expenses.
Added
Interest Income and Other Income (Expense), Net and Interest Expense Interest income and other income (expense), net consists of income earned on our marketable securities and investments, in addition to foreign currency transaction gains and losses.
Added
Interest expense consists of contractual interest expense and amortization of the debt discount on the senior mandatory convertible promissory notes we issued in January and June 2020 to a trust affiliated with our CEO, and interest expense from our term loan and revolving credit facility.
Added
Provision for Income Taxes Provision for income taxes consists primarily of income taxes in certain foreign jurisdictions in which we conduct business. To date, we have not recorded a material provision for income taxes for any of the periods presented other than for foreign income tax.
Added
We have recorded deferred tax assets for which we provide a full valuation allowance, which primarily include net operating loss carryforwards and research and development tax credit carryforwards.
Added
We expect to maintain this full valuation allowance for the foreseeable future as it is more likely than not the deferred tax assets will not be realized based on our history of losses. 62 Table of Contents Results of Operations The following tables set forth our results of operations for the periods presented and as a percentage of our revenues for those periods.
Added
The period-to-period comparison of financial results is not necessarily indicative of financial results to be achieved in future periods.
Added
Year Ended January 31, 2024 2023 2022 (in thousands) Revenues $ 652,504 $ 547,212 $ 378,437 Cost of revenues (1) 64,524 56,559 38,897 Gross profit 587,980 490,653 339,540 Operating expenses: Research and development (1) 324,688 297,209 203,124 Sales and marketing (1) 391,955 434,961 282,897 General and administrative (1) 141,334 166,309 118,703 Total operating expenses 857,977 898,479 604,724 Loss from operations (269,997) (407,826) (265,184) Interest income and other income (expense), net 20,624 6,933 (1,536) Interest expense (3,952) (2,000) (18,385) Loss before provision for income taxes (253,325) (402,893) (285,105) Provision for income taxes 3,705 4,875 3,237 Net loss $ (257,030) $ (407,768) $ (288,342) __________________ (1) Amounts include stock-based compensation expense as follows: Year Ended January 31, 2024 2023 2022 (in thousands) Cost of revenues $ 1,549 $ 1,658 $ 806 Research and development 112,619 100,083 57,480 Sales and marketing 59,217 58,504 29,631 General and administrative 29,033 28,717 16,644 Total stock-based compensation expense (1) $ 202,418 $ 188,962 $ 104,561 __________________ (1) The table above includes $0.9 million of stock-based compensation expense for the fiscal year ended January 31, 2023 that was incurred as a result of the restructuring.
Added
See Note 17. Restructuring to our consolidated financial statements included in Item 8. Financial Statements and Supplementary Data in this Annual Report on Form 10-K for more information. 63 Table of Contents The following table sets forth the components of our statements of operations data, for each of the periods presented, as a percentage of revenues.
Added
Year Ended January 31, 2024 2023 2022 (percent of revenues) Revenues 100 % 100 % 100 % Cost of revenues 10 10 10 Gross margin 90 90 90 Operating expenses: Research and development 50 54 54 Sales and marketing 60 79 75 General and administrative 22 30 31 Total operating expenses 131 164 160 Loss from operations (41) (75) (70) Interest income and other income (expense), net 3 1 * Interest expense * * (5) Loss before provision for income taxes (39) (74) (75) Provision for income taxes * * * Net loss (39) % (75) % (76) % ________________ * Less than 1% Note: Certain figures may not sum due to rounding.
Added
Comparison of the Fiscal Years Ended January 31, 2024 and 2023 Revenues Year Ended January 31, 2024 2023 $ Change % Change (dollars in thousands) Revenues $ 652,504 $ 547,212 $ 105,292 19 % Revenues increased $105.3 million, or 19%, during fiscal 2024 compared to fiscal 2023.
Added
The increase in revenues was primarily due to the addition of new paying customers and a continued shift in our sales mix toward our higher priced subscription plans, such as Business, Advanced, Enterprise and Enterprise+ plans.
Added
Cost of Revenues and Gross Margin Year Ended January 31, 2024 2023 $ Change % Change (dollars in thousands) Cost of revenues $ 64,524 $ 56,559 $ 7,965 14 % Gross margin 90 % 90 % Cost of revenues increased $8.0 million, or 14%, during fiscal 2024 compared to fiscal 2023.
Added
The increase was primarily due to an increase of $4.8 million in third-party hosting costs as we increased capacity to support customer usage and growth of our customer base, an increase of $2.5 million in infrastructure and application performance monitoring costs, an increase of $1.6 million in credit card processing fees, and an increase of $1.5 million in amortization of capitalized software development costs, partially offset by a decrease of $2.1 million in personnel-related costs due to decreased headcount and a decrease of $0.5 million in fees to third party support vendors. 64 Table of Contents Our gross margin stayed consistent during fiscal 2024 compared to fiscal 2023.
Added
Operating Expenses Year Ended January 31, 2024 2023 $ Change % Change (dollars in thousands) Research and development $ 324,688 $ 297,209 $ 27,479 9 % Sales and marketing 391,955 434,961 (43,006) (10) % General and administrative 141,334 166,309 (24,975) (15) % Total operating expenses $ 857,977 $ 898,479 $ (40,502) (5) % Research and Development Research and development expenses increased $27.5 million, or 9%, during fiscal 2024 compared to fiscal 2023.
Added
The increase was primarily due to an increase of $28.9 million in personnel-related expenses driven by higher headcount, an increase of $5.5 million in allocated overhead costs as a result of increased overall costs to support the growth of our business and related infrastructure, and an increase of $0.9 million in fees to third party support vendors, partially offset by an increase of $6.3 million in capitalized internal-use software, a decrease of $1.0 million in cloud computing and related costs, and a decrease of $0.8 million in equipment and related costs.
Added
Sales and Marketing Sales and marketing expenses decreased $43.0 million, or 10%, during fiscal 2024 compared to fiscal 2023.
Added
The decrease was due to a decrease of $38.7 million in fees to marketing vendors, a decrease of $3.1 million in fees to third party support vendors, a decrease of $2.7 million in personnel-related expenses as a result of decreased headcount, and a decrease of $1.2 million in allocated overhead costs, partially offset by an increase of $2.4 million in travel and entertainment costs and an increase of $0.3 million in professional services.
Added
General and Administrative General and administrative expenses decreased $25.0 million, or 15%, during fiscal 2024 compared to fiscal 2023.
Added
The decrease was primarily due to a decrease of $13.8 million in personnel-related costs due to decreased headcount, a decrease of $4.7 million in fees to third party support vendors, a decrease of $4.4 million in value-added tax reserves, a decrease of $3.5 million in allocated overhead costs, a decrease of $3.2 million in professional services, and a decrease of $1.9 million in insurance expenses, partially offset by an increase of $5.0 million in impairment charges related to subleased office space, an increase of $1.1 million in local taxes, and an increase of $1.0 million in provision for credit losses.
Added
Interest Income, Interest Expense, and Other Income (Expense), Net Year Ended January 31, 2024 2023 $ Change % Change (dollars in thousands) Interest income and other income (expense), net $ 20,624 $ 6,933 $ 13,691 197 % Interest expense (3,952) (2,000) (1,952) 98 % Interest income and other income (expense), net increased $13.7 million during fiscal 2024 compared to fiscal 2023 due primarily to an increase in interest income from our investments in marketable securities.
Added
Interest expense increased $2.0 million during fiscal 2024 compared to fiscal 2023 primarily due to an increase in interest rates. 65 Table of Contents Comparison of the Fiscal Years Ended January 31, 2023 and 2022 For a comparison of our results of operations for the fiscal years ended January 31, 2023 and 2022, see Part II— Item 7.
Added
Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended January 31, 2023, filed with the SEC on March 24, 2023. Non-GAAP Financial Measures The following tables present certain non-GAAP financial measures for each period presented below.
Added
In addition to our results determined in accordance with GAAP, we believe these non-GAAP financial measures are useful in evaluating our operating performance. See below for a description of the non-GAAP financial measures and their limitations as an analytical tool.
Added
Year Ended January 31, 2024 2023 2022 (in thousands) Non-GAAP loss from operations $ (58,099) $ (207,280) $ (157,055) Non-GAAP net loss $ (45,132) $ (207,222) $ (162,915) Free cash flow $ (30,385) $ (159,550) $ (87,624) Non-GAAP Loss From Operations and Non-GAAP Net Loss We define non-GAAP loss from operations as loss from operations plus stock-based compensation expense and the related employer payroll tax associated with RSUs, impairment of long-lived assets, as well as non-recurring costs, such as restructuring costs and direct listing expenses.
Added
The amount of employer payroll tax-related items on employee stock transactions is dependent on our stock price and other factors that are beyond our control and that do not correlate to the operation of the business.
Added
The restructuring costs are related to the reduction of our global workforce during the fiscal year ended January 31, 2023, which resulted in expenses related to severance, benefits, and other related items.
Added
When evaluating the performance of our business and making operating plans, we do not consider these items (for example, when considering the impact of equity award grants, we place a greater emphasis on overall stockholder dilution rather than the accounting charges associated with such grants).
Added
We believe it is useful to exclude these expenses in order to better understand the long-term performance of our core business, to facilitate comparison of our results to those of peer companies, and to facilitate comparison over multiple periods.
Added
We define non-GAAP net loss as net loss plus stock-based compensation expense and the related employer payroll tax associated with RSUs, amortization of discount and non-cash contractual interest expense related to our senior mandatory convertible promissory notes, impairment of long-lived assets, and non-recurring costs such as restructuring costs and direct listing expenses.
Added
We use non-GAAP loss from operations and non-GAAP net loss in conjunction with traditional GAAP measures to evaluate our financial performance. We believe that non-GAAP loss from operations and non-GAAP net loss provide our management and investors consistency and comparability with our past financial performance and facilitates period-to-period comparisons of operations.
Added
Free Cash Flow We define free cash flow as net cash from operating activities less cash used for purchases of property and equipment and capitalized internal-use software costs, plus non-recurring expenditures such as capital expenditures from the purchases of property and equipment associated with the build-out of our corporate headquarters in San Francisco, restructuring costs, and direct listing expenses.
Added
We believe that free cash flow is a useful indicator of liquidity that provides information to management and investors, even if negative, about the amount of cash used in our operations other than that used for investments in property and equipment and capitalized internal-use software costs, adjusted for non-recurring expenditures. 66 Table of Contents Limitations and Reconciliations of Non-GAAP Financial Measures Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for financial information presented under GAAP.

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Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

27 edited+3 added−9 removed47 unchanged
Biggest changeThese anti-takeover provisions include: • a classified board of directors so that not all members of our board of directors are elected at one time; • the ability of our board of directors to determine the number of directors and to fill any vacancies and newly created directorships; • a requirement that our directors may only be removed for cause; • a prohibition on cumulative voting for directors; • the requirement of a super-majority to amend some provisions in our restated certificate of incorporation and restated bylaws; • authorization of the issuance of “blank check” preferred stock that our board of directors could use to implement a stockholder rights plan; • provide for a dual class common stock structure in which holders of our Class B common stock, which has 10 votes per share, have the ability to control the outcome of matters requiring stockholder approval, even if they own significantly less than a majority of the outstanding shares of our Class B and Class A common stock, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets; • an inability of our stockholders to call special meetings of stockholders; and • a prohibition on stockholder actions by written consent, thereby requiring that all stockholder actions be taken at a meeting of our stockholders. 53 Table of Contents Moreover, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporation Law, which prohibit a person who owns 15% or more of our outstanding voting stock from merging or combining with us for a three-year period beginning on the date of the transaction in which the person acquired in excess of 15% of our outstanding voting stock, unless the merger or combination is approved in a prescribed manner.
Biggest changeThese anti-takeover provisions include: • a classified board of directors so that not all members of our board of directors are elected at one time; • the ability of our board of directors to determine the number of directors and to fill any vacancies and newly created directorships; • a requirement that our directors may only be removed for cause; • a prohibition on cumulative voting for directors; • the requirement of a super-majority to amend some provisions in our restated certificate of incorporation and amended and restated bylaws; • authorization of the issuance of “blank check” preferred stock that our board of directors could use to implement a stockholder rights plan; • provide for a dual class common stock structure in which holders of our Class B common stock, which has 10 votes per share, have the ability to control the outcome of matters requiring stockholder approval, even if they own significantly less than a majority of the outstanding shares of our Class B and Class A common stock, including the election of directors and significant corporate transactions, such as a merger or other sale of our company or its assets; • an inability of our stockholders to call special meetings of stockholders; and • a prohibition on stockholder actions by written consent, thereby requiring that all stockholder actions be taken at a meeting of our stockholders.
In the event of a major earthquake, hurricane, or catastrophic event such as fire, power loss, telecommunications failure, cyber-attack, war, or terrorist attack, we may be unable to continue our operations and may endure system interruptions, reputational harm, delays in our platform development, lengthy interruptions in our platform, breaches of data security, and loss of critical data, all of which would harm our business, results of operations, and financial condition.
In the event of a major earthquake, hurricane, or catastrophic event such as fire, power loss, telecommunications failure, cyber-attack, war, or terrorist attack, we may be unable to continue our operations and may endure system interruptions, reputational harm, delays in our platform development, lengthy interruptions in our platform, breaches of security, and loss of critical data, all of which would harm our business, results of operations, and financial condition.
Any provision in our restated certificate of incorporation, our restated bylaws, or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our Class A common stock, and could also affect the price that some investors are willing to pay for our Class A common stock.
Any provision in our restated certificate of incorporation, our amended and restated bylaws, or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our Class A common stock, and could also affect the price that some investors are willing to pay for our Class A common stock.
There are provisions in our restated certificate of incorporation and restated bylaws that may make it difficult for a third party to acquire, or attempt to acquire, control of our company, even if a change in control were considered favorable by our stockholders.
There are provisions in our restated certificate of incorporation and amended and restated bylaws that may make it difficult for a third party to acquire, or attempt to acquire, control of our company, even if a change in control were considered favorable by our stockholders.
Dustin Moskovitz, our co-founder, President, Chief Executive Officer, Chair, and largest stockholder, beneficially owns a significant percentage of our outstanding Class A common stock and Class B common stock, together, representing a majority of the voting power of our capital stock as of January 31, 2023. Mr. Moskovitz could exert substantial influence over matters requiring approval by our stockholders.
Dustin Moskovitz, our co-founder, President, Chief Executive Officer, Chair, and largest stockholder, beneficially owns a significant percentage of our outstanding Class A common stock and Class B common stock, together representing a majority of the voting power of our capital stock as of January 31, 2024. Mr. Moskovitz could exert substantial influence over matters requiring approval by our stockholders.
The trading price of our Class A common stock has been and could continue to be subject to wide fluctuations in response to numerous factors in addition to the ones described in the preceding Risk Factors, many of which are beyond our control, including: • actual or anticipated fluctuations in our results of operations; • overall performance of the equity markets, the economy as a whole, and macroeconomic factors such as inflationary pressures; • changes in the financial projections we may provide to the public or our failure to meet these projections; • failure of securities analysts to initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow our company, or our failure to meet these estimates or the expectations of investors; • changes in pricing of subscription plans to our platform; • actual or anticipated changes in our growth rate relative to that of our competitors; • changes in the anticipated future size or growth rate of our addressable markets; • announcements of new products, or of acquisitions, strategic partnerships, joint ventures, or capital-raising activities or commitments, by us or by our competitors; • additions or departures of board members, management, or key personnel; • rumors and market speculation involving us or other companies in our industry; • new laws or regulations or new interpretations of existing laws or regulations applicable to our business, including those related to data privacy and cyber security in the United States or globally; • lawsuits threatened or filed against us; • other events or factors, including bank failures, war, incidents of terrorism, or responses to these events; • health epidemics, such as the COVID-19 pandemic, influenza, and other highly communicable diseases or viruses; and • sales, purchases, or expectations with respect to such transactions, of shares of our Class A common stock by us or our security holders, particularly by our founders, directors, executive officers, and principal 49 Table of Contents stockholders, none of whom are subject to any contractual lock-up agreement or other contractual restrictions on transfer.
The trading price of our Class A common stock has been and could continue to be subject to wide fluctuations in response to numerous factors in addition to the ones described in the preceding Risk Factors, many of which are beyond our control, including: • actual or anticipated fluctuations in our results of operations; • overall performance of the equity markets, the economy as a whole, and macroeconomic factors such as inflationary pressures; • changes in the financial projections we may provide to the public or our failure to meet these projections; • failure of securities analysts to initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow our company, or our failure to meet these estimates or the expectations of investors; • changes in pricing of subscription plans to our platform; • actual or anticipated changes in our growth rate relative to that of our competitors; • changes in the anticipated future size or growth rate of our addressable markets; • announcements of new products, or of acquisitions, strategic partnerships, joint ventures, or capital-raising activities or commitments, by us or by our competitors; • additions or departures of board members, management, or key personnel; • rumors and market speculation involving us or other companies in our industry; • new laws or regulations or new interpretations of existing laws or regulations applicable to our business, including those related to privacy, data protection, and security in the United States or globally; • lawsuits threatened or filed against us; • other events or factors, including bank failures, war, incidents of terrorism, or responses to these events; • health epidemics, such as influenza, and other highly communicable diseases or viruses; and • sales, purchases, or expectations with respect to such transactions, of shares of our Class A common stock by us or our security holders, particularly by our founders, directors, executive officers, and principal stockholders, none of whom are subject to any contractual lock-up agreement or other contractual restrictions on transfer.
Significant assumptions and estimates used in preparing our consolidated financial statements include those related to the useful lives and carrying values of long-lived assets, the fair value of the convertible note, the fair value of common stock, stock-based compensation expense, the period of benefit for deferred contract acquisition costs, and income taxes.
Significant assumptions and estimates used in preparing our consolidated financial statements include those related to the useful lives and carrying values of long-lived assets, the fair value of common stock, stock-based compensation expense, the period of benefit for deferred contract acquisition costs, and income taxes.
If we were to become involved in securities litigation, it could subject us to substantial costs, divert resources and the attention of management from our business, and adversely affect our business, results of operations, and financial condition. Our largest stockholder will have the ability to influence the outcome of director elections and other matters requiring stockholder approval.
If we were to become involved in securities litigation, it could subject us to substantial costs, divert resources and the attention of management from our business, and adversely affect our business, results of operations, and financial condition. 49 Table of Contents Our largest stockholder will have the ability to influence the outcome of director elections and other matters requiring stockholder approval.
The provisions would not apply to suits brought to enforce a duty or liability created by the Securities Act, the Exchange Act or any other claim for which the U.S. federal courts have exclusive jurisdiction. Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all such Securities Act actions.
The provisions would not apply to suits brought to enforce a duty or liability created by the Securities Act, the Exchange Act or any other claim for which the U.S. federal courts have exclusive jurisdiction. 53 Table of Contents Furthermore, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all such Securities Act actions.
In addition, certain of our securityholders have rights, subject to some conditions, to require us to file registration statements for the public resale of the Class A common stock or to include such shares in registration statements that we may file for us or other stockholders.
In addition, certain of our security holders have rights, subject to some conditions, to require us to file registration statements for the public resale of the Class A common stock or to include such shares in registration statements that we may file for us or other stockholders.
Any future determination to pay dividends on our capital stock will be at the discretion of our board of directors. In addition, our November 2022 Senior Secured Credit Facility contains restrictions on our ability to 52 Table of Contents pay dividends.
Any future determination to pay dividends on our capital stock will be at the discretion of our board of directors. In addition, our November 2022 Senior Secured Credit Facility contains restrictions on our ability to pay dividends.
Our results of operations may be adversely affected if our assumptions change or if actual circumstances differ from those in our assumptions, which could cause our results of operations to fall below the expectations of securities analysts and investors, resulting in a decline in the trading price of our Class A common stock. Catastrophic events may disrupt our business.
Our results of operations may be adversely affected if our assumptions change or if actual circumstances differ from those in our assumptions, which could cause our results of operations to fall below the expectations of securities analysts and investors, resulting in a decline in the trading price of our Class A common stock.
In addition, various news sources, bloggers, and other publishers often make statements regarding our 51 Table of Contents historical or projected business or financial performance, and you should not rely on any such information even if it is attributed directly or indirectly to us.
In addition, various news sources, bloggers, and other publishers often make statements regarding our historical or projected business or financial performance, and you should not rely on any such information even if it is attributed directly or indirectly to us.
In addition, on September 7, 2022, we issued and sold 19,273,127 shares of our Class A common stock to Dustin Moskovitz in a private placement transaction, at a purchase price of $18.16 per share, based on the closing trading price of the Company’s Class A common stock on September 2, 2022, for aggregate gross proceeds of approximately $350 million.
For example, on September 7, 2022, we issued and sold 19,273,127 shares of our Class A common stock to our CEO and co-founder, Dustin Moskovitz, in a private placement transaction, at a purchase price of $18.16 per share, based on the closing trading price of the Company’s Class A common stock on September 2, 2022, for aggregate gross proceeds of approximately $350 million.
Also, the exercise of stock options to purchase our stock and the settlement of restricted stock units (“RSUs”) will result in further dilution. The amount of dilution could be substantial depending upon the size of the issuance or exercise.
Also, the exercise of stock options to purchase our stock and the settlement of RSUs will result in further dilution. The amount of dilution could be substantial depending upon the size of the issuance or exercise.
Natural disasters or other catastrophic events may cause damage or disruption to our operations, international commerce, and the global economy, and thus could harm our business.
Catastrophic events, health epidemics, or geopolitical conflicts may disrupt our business. Natural disasters or other catastrophic events may cause damage or disruption to our operations, international commerce, and the global economy, and thus could harm our business.
Certain provisions in our corporate charter documents and under Delaware law may prevent or hinder attempts by our stockholders to change our management or to acquire a controlling interest in us, and the trading price of our Class A common stock may be lower as a result.
Any future such transactions, notes or issuances could result in substantial dilution to our existing stockholders and cause the trading price of our Class A common stock to decline. 52 Table of Contents Certain provisions in our corporate charter documents and under Delaware law may prevent or hinder attempts by our stockholders to change our management or to acquire a controlling interest in us, and the trading price of our Class A common stock may be lower as a result.
In particular, health crises, such as the 48 Table of Contents COVID-19 pandemic, and international conflicts, such as the invasion of Ukraine by Russia and related economic sanctions, including the reactions of governments, markets, and the general public, may result in a number of adverse consequences for our business, operations, and results of operations, many of which are beyond our control.
In particular, health crises, such as the COVID-19 pandemic, and international conflicts, such as the invasion of Ukraine by Russia or the armed conflict in Israel and the Gaza Strip, including the reactions of governments, markets, and the general public, may result in a number of adverse consequences for our business, operations, and results of operations, both worldwide and in our offices in affected regions, many of which are beyond our control.
Moskovitz, one or more of the persons or entities holding our Class B common stock could gain 50 Table of Contents significant voting control as other holders of Class B common stock sell or otherwise convert their shares into Class A common stock.
Moskovitz, one or more of the persons or entities holding our Class B common stock could gain significant voting control as other holders of Class B common stock sell or otherwise convert their shares into Class A common stock. We cannot predict the effect our dual class structure may have on the trading price of our Class A common stock.
We cannot predict the effect our dual class structure may have on the trading price of our Class A common stock. We cannot predict whether our dual class structure will result in a lower or more volatile trading price of our Class A common stock on the NYSE and the LTSE, in adverse publicity, or other adverse consequences.
We cannot predict whether our dual class structure will result in a lower or more volatile trading price of our Class A common stock on the NYSE and the LTSE, in adverse publicity, or other adverse consequences. For example, certain index providers have announced restrictions on including companies with multiple-class share structures in certain of their indices.
If one or more of these analysts cease coverage of our company, or fail to regularly publish reports on us, the demand for our Class A common stock could decrease, which in turn could cause our trading price or trading volume to decline.
If one or more of these analysts cease coverage of our company, or fail to regularly publish reports on us, the demand for our Class A common stock could decrease, which in turn could cause our trading price or trading volume to decline. 51 Table of Contents The requirements of being a public company may strain our resources, divert management’s attention, and affect our ability to attract and retain executive management and qualified board members.
Our disaster recovery plan may not be sufficient to address all aspects or any unanticipated consequence or incident, and our insurance may not be sufficient to compensate us for the losses that could occur.
Our disaster recovery plan may not be sufficient to address all aspects or any unanticipated consequence or incident, and our insurance may not be sufficient to compensate us for the losses that could occur. 48 Table of Contents Risks Related To Ownership of Our Class A Common Stock The trading price of our Class A common stock may be volatile and could decline significantly and rapidly.
The requirements of being a public company may strain our resources, divert management’s attention, and affect our ability to attract and retain executive management and qualified board members. As a public company, we are subject to the reporting requirements of the Exchange Act, the listing standards of the NYSE and the LTSE, and other applicable securities rules and regulations.
As a public company, we are subject to the reporting requirements of the Exchange Act, the listing standards of the NYSE and the LTSE, and other applicable securities rules and regulations.
Under such announced policies, the dual class structure of our common stock would make us ineligible for inclusion in certain indices and, as a result, mutual funds, exchange-traded funds, and other investment vehicles that attempt to passively track those indices would not invest in our Class A common stock.
As a result, mutual funds, exchange-traded funds, and other investment vehicles that attempt to passively track those indices may not invest in our Class A common stock if we are not included and the trading price of our Class A 50 Table of Contents common stock could be adversely affected.
In July 2017, FTSE Russell announced that it plans to require new constituents of its indices to have greater than 5% of the company’s voting rights in the hands of public stockholders, and S&P Dow Jones announced that it will no longer admit companies with multiple-class share structures to certain of its indices.
In July 2017, FTSE Russell announced that it would require new constituents of its indices to have greater than 5% of the company’s voting rights in the hands of public stockholders. Under such policies, the dual class structure of our common stock may make us ineligible for inclusion in certain indices.
Affected indices include the Russell 2000 and the S&P 500, S&P MidCap 400, and S&P SmallCap 600, which together make up the S&P Composite 1500.
Previously, S&P Dow Jones also excluded companies utilizing dual or multi-class capital structures from its indices, including the S&P 500, the S&P MidCap 400, and the S&P SmallCap 600, which together make up the S&P Composite 1500.
Given the sustained flow of investment funds into passive strategies that seek to track certain indices, exclusion from certain stock indices would likely preclude investment by many of these funds and would make our Class A common stock less attractive to other investors. As a result, the trading price of our Class A common stock could be adversely affected.
Such restrictions, reluctance and unwillingness may make our Class A common stock less attractive to investors and, as a result, the market price of our Class A common stock could be adversely affected.
Removed
Risks Related To Ownership of Our Class A Common Stock The trading price of our Class A common stock may be volatile and could decline significantly and rapidly.
Added
However, in April 2023, it reversed this policy and announced that companies with dual or multi-class capital structures will again be eligible for inclusion on its indices. We cannot be sure that this policy, or the policies of other indices, will not change further and make us ineligible for inclusion on indices in the future.
Removed
For example, certain index providers have announced restrictions on including companies with multiple-class share structures in certain of their indices.
Added
In addition, institutional investors and certain investment funds may also be precluded, reluctant or unwilling to invest in entities with multiple class structures due to a lack of ability to meaningfully influence corporate affairs had policies through voting.
Removed
Also in 2017, MSCI, a leading stock index provider, opened public consultations on their treatment of no-vote and multi-class structures and temporarily barred new multi-class listings from certain of its indices; however, in October 2018, MSCI announced its decision to include equity securities “with unequal voting structures” in its indices and to launch a new index that specifically includes voting rights in its eligibility criteria.
Added
Moreover, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporation Law, which prohibit a person who owns 15% or more of our outstanding voting stock from merging or combining with us for a three-year period beginning on the date of the transaction in which the person acquired in excess of 15% of our outstanding voting stock, unless the merger or combination is approved in a prescribed manner.
Removed
These policies are relatively new and it is unclear what effect, if any, they will have on the valuations of publicly-traded companies excluded from such indices, but it is possible that they may depress valuations, as compared to similar companies that are included.
Removed
Because of the dual class structure of our common stock, we will likely be excluded from certain indices, and we cannot assure you that other stock indices will not take similar actions.
Removed
For example, in January and June 2020, we issued and sold convertible notes to the Dustin Moskovitz Trust, an affiliated trust of Mr.
Removed
Moskovitz, for an aggregate principal amount of $450.0 million, that, if converted prior to their maturity, would convert into a number of shares of our Class B common stock between an aggregate of 17,012,822 and 27,220,504 shares (the “Convertible Notes”).
Removed
On July 1, 2021, pursuant to the terms of the Convertible Notes, upon meeting the closing trading price criteria for optional conversion by Asana, we elected to convert all remaining amounts outstanding under the Convertible Notes into shares of our Class B common stock at the applicable minimum conversion rate set forth in the Convertible Notes, for the issuance of an aggregate of 17,012,822 shares of Class B common stock to the Dustin Moskovitz Trust.
Removed
Any future such transactions, notes or issuances could result in substantial dilution to our existing stockholders and cause the trading price of our Class A common stock to decline.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

7 edited+2 added−2 removed4 unchanged
Biggest changeOur investments are exposed to market risk due to fluctuations in interest rates, which may affect our interest income and the fair value of our investments.
Biggest changeOur investments are exposed to market risk due to fluctuations in interest rates, which may affect our interest income and the fair value of our investments. As of January 31, 2024, a hypothetical increase in interest rates by 100 basis points would not have a material impact on our consolidated financial statements.
Foreign Currency Risk The majority of our subscription agreements are denominated in U.S. dollars, with the remainder generated in Euros, British Pounds, Australian Dollars, Japanese Yen, Mexican Pesos, Brazilian Reais, Canadian Dollars, and Korean Won.
Foreign Currency Risk The majority of our subscription agreements are denominated in U.S. dollars, with the remainder generated in Euros, British Pounds, Australian Dollars, Japanese Yen, Mexican Pesos, Brazilian Reais, Canadian Dollars, and South Korean Won.
A portion of our operating expenses are incurred outside the United States, denominated in foreign currencies, and subject to fluctuations due to changes in foreign currency exchange rates, particularly changes in the Euro, British Pound, Canadian Dollar, Australian Dollar, Japanese Yen, Icelandic Krona, Singapore Dollar, and Swiss Franc.
A portion of our operating expenses are incurred outside the United States, denominated in foreign currencies, and subject to fluctuations due to changes in foreign currency exchange rates, particularly changes in the Euro, British Pound, Canadian Dollar, Australian Dollar, Japanese Yen, Icelandic Krona, Singapore Dollar, Swiss Franc, and Polish Zloty.
We disclose the impact of realized foreign currency gains and losses within Note 13. Interest Income and Other Income (Expense), Net . A hypothetical 10% change in foreign currency rates would not have resulted in material gains or losses for the years ended January 31, 2023 and 2022.
We disclose the impact of realized foreign currency gains and losses within Note 13. Interest Income and Other Income (Expense), Net . A hypothetical 10% change in foreign currency rates would not have resulted in material gains or losses for the years ended January 31, 2024 and 2023.
As the impact of foreign currency exchange rates are not projected to be material to our operating results, we have not entered into derivative or hedging transactions, but we may do so in the future if our exposure to foreign currency becomes more significant. 74
As the impact of foreign currency exchange rates are not projected to be material to our operating results, we have not entered into derivative or hedging transactions, but we may do so in the future if our exposure to foreign currency becomes more significant. 75
In the year ended January 31, 2023, 21% of our sales were denominated in currencies other than U.S. dollars. Our expenses, by contrast, are primarily denominated in U.S. dollars. As a result, any increase in the value of the U.S. dollar against these foreign currencies could cause our revenue to decline relative to our costs, thereby decreasing our margins.
In the year ended January 31, 2024, 24% of our sales were denominated in currencies other than U.S. dollars. Our expenses, by contrast, are primarily denominated in U.S. dollars. As a result, any increase in the value of the U.S. dollar against these foreign currencies could cause our revenue to decline relative to our costs, thereby decreasing our margins.
As of January 31, 2023 and January 31, 2022, we had cash and cash equivalents of $526.6 million and $240.4 million, respectively, and marketable securities including non-current investments of $2.7 million and $74.4 million, respectively. We do not enter into investments for trading or speculative purposes.
As of January 31, 2024 and January 31, 2023, we had cash and cash equivalents of $236.7 million and $526.6 million, respectively, and marketable securities of $282.8 million and $2.7 million, respectively. We do not enter into investments for trading or speculative purposes.
Removed
The uncertainty that exists with respect to the global economic impact of the 73 Table of Contents COVID-19 pandemic and the macroeconomic environment has introduced significant volatility in the financial markets.
Added
Any borrowings under the revolving credit facility bear interest at a variable rate tied to the adjusted term SOFR, the prime rate, or the federal funds effective rate. As of January 31, 2024, we had $46.9 million outstanding under the credit facility.
Removed
However, due to the short-term nature of our marketable securities, we do not believe we are materially exposed to changes in the fair value of our investment portfolio due to potential fluctuations in interest rates, and therefore do not expect our operating results or cash flows to be materially affected by a sudden change in market interest rates.
Added
We do not have any other long-term debt or financial liabilities with floating interest rates that would subject us to interest rate fluctuations. As of January 31, 2024, a hypothetical increase of 100 basis points in interest rates would not have a material impact on our consolidated financial statements.

Other ASAN 10-K year-over-year comparisons