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What changed in Fiverr International Ltd.'s 20-F — 2022 vs 2023

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Paragraph-level year-over-year comparison of Fiverr International Ltd.'s 2022 and 2023 20-F 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 2023 report.

+513 added−502 removedSource: 20-F (2024-02-22) vs 20-F (2023-03-30)

Top changes in Fiverr International Ltd.'s 2023 20-F

513 paragraphs added · 502 removed · 393 edited across 6 sections

Item 2. Properties

Properties — owned and leased real estate

1 edited+0 added−0 removed0 unchanged
Biggest changeITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 6 ITEM 3. KEY INFORMATION 6 A. [Reserved] 6 B. Capitalization and Indebtedness 6 C. Reasons for the Offer and Use of Proceeds 6 D. Risk Factors 6 ITEM 4. INFORMATION ON THE COMPANY 31 A. History and Development of the Company 31 B. Business Overview 31 C. Organizational Structure 45 D.
Biggest changeITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 7 ITEM 3. KEY INFORMATION 7 A. [Reserved] 7 B. Capitalization and Indebtedness 7 C. Reasons for the Offer and Use of Proceeds 7 D. Risk Factors 7 ITEM 4. INFORMATION ON THE COMPANY 38 A. History and Development of the Company 38 B. Business Overview 38 C. Organizational Structure 54 D.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

139 edited+62 added−38 removed290 unchanged
Biggest changeCompetition for highly skilled technical and other personnel is intense, and as a result we may fail to attract, recruit, retain and develop qualified employees, which could materially and adversely impact our business, financial condition and results of operations. We compete in a market marked by rapidly changing technologies and an evolving competitive landscape.
Biggest changeOnce fully applicable, the EU AI Act will have a material impact on the way artificial intelligence is regulated in the EU, and together with developing guidance and/or decisions in this area, likely to affect our use of artificial intelligence and our ability to provide and to improve our services, require additional compliance measures and changes to our operations and processes, result in increased compliance costs and potential increases in civil claims against us, and could adversely affect our business, operations and financial condition. 19 Competition for highly skilled technical and other personnel is intense, and as a result we may fail to attract, recruit, retain and develop qualified employees, which could materially and adversely impact our business, financial condition and results of operations.
Additionally, Israeli courts might not enforce judgments obtained in the United States against us or our non-U.S. our directors and executive officers, which may make it difficult to collect on judgments rendered against us or our non-U.S. officers and directors.
Additionally, Israeli courts might not enforce judgments obtained in the United States against us or our non-U.S. directors and executive officers, which may make it difficult to collect on judgments rendered against us or our non-U.S. officers and directors.
Operating internationally subjects us to new risks and may increase risks that we currently face, including risks associated with: • recruiting and retaining talented and capable employees outside of Israel and the United States, and maintaining our company culture across all of our offices; • recruiting and retaining contractors in Ukraine, which is currently affected by the war with Russia; • providing our platform and operating our business across a significant distance, in different languages and among different cultures, including the potential need to modify our platform and features to ensure that they are culturally appropriate and relevant in different countries; • compliance with applicable international laws and regulations, including laws and regulations with respect to privacy, data protection, consumer protection and unsolicited email, and the risk of penalties to our users and individual members of management or employees if our practices are deemed to be out of compliance; • operating in jurisdictions that do not protect intellectual property rights to the same extent as does the United States; • compliance by us and our business partners with anti-corruption laws, import and export control laws, tariffs, trade barriers, economic sanctions and other regulatory limitations on our ability to provide our platform in certain international markets; • political and economic instability; • fluctuations in currency exchange rates; • double taxation of our international earnings and potentially adverse tax consequences due to changes in the income and other tax laws of Israel, the United States or the international jurisdictions in which we operate; and • higher costs of doing business internationally, including increased accounting, travel, infrastructure and legal compliance costs.
Operating internationally subjects us to new risks and may increase risks that we currently face, including risks associated with: • recruiting and retaining talented and capable employees and contractors outside of Israel and the United States, and maintaining our company culture across all of our offices; • recruiting and retaining contractors in Ukraine, which is currently affected by the war with Russia; • providing our platform and operating our business across a significant distance, in different languages and among different cultures, including the potential need to modify our platform and features to ensure that they are culturally appropriate and relevant in different countries; 16 • compliance with applicable international laws and regulations, including laws and regulations with respect to privacy, data protection, consumer protection and unsolicited email, and the risk of penalties to our users and individual members of management or employees if our practices are deemed to be out of compliance; • operating in jurisdictions that do not protect intellectual property rights to the same extent as does the United States; • compliance by us and our business partners with anti-corruption laws, import and export control laws, tariffs, trade barriers, economic sanctions and other regulatory limitations on our ability to provide our platform in certain international markets; • political and economic instability; • fluctuations in currency exchange rates; • double taxation of our international earnings and potentially adverse tax consequences due to changes in the income and other tax laws of Israel, the United States or the international jurisdictions in which we operate; and • higher costs of doing business internationally, including increased accounting, travel, infrastructure and legal compliance costs.
Among other things: • Israeli corporate law regulates mergers and requires that a tender offer be effected when more than a specified percentage of shares in a company are purchased; • Israeli corporate law does not provide for shareholder action by written consent, thereby requiring all shareholder actions to be taken at a general meeting of shareholders; • our amended and restated articles of association divide our directors into three classes, each of which is elected once every three years; • our amended and restated articles of association generally require a vote of the holders of a majority of our outstanding ordinary shares entitled to vote present and voting on the matter at a general meeting of shareholders (referred to as simple majority), and the amendment of a limited number of provisions, such as the provision dividing our directors into three classes, requires a vote of the holders of at least 65% of the total voting power of our shareholders; • our amended and restated articles of association do not permit a director to be removed except by a vote of the holders of at least 65% of the total voting power of our shareholders and any amendment to such provision requires the approval of at least 65% of the total voting power of our shareholders; and • our amended and restated articles of association provide that director vacancies may be filled by our board of directors.
Among other things: • Israeli corporate law regulates mergers and requires that a tender offer be effected when more than a specified percentage of shares in a company are purchased; • Israeli corporate law does not provide for shareholder action by written consent, thereby requiring all shareholder actions to be taken at a general meeting of shareholders; • our amended and restated articles of association divide our directors into three classes, each of which is elected once every three years; • our amended and restated articles of association generally require a vote of the holders of a majority of our outstanding ordinary shares entitled to vote present and voting on the matter at a general meeting of shareholders (referred to as simple majority), and the amendment of a limited number of provisions, such as the provision dividing our directors into three classes, requires a vote of the holders of at least 65% of the total voting power of our shareholders; 32 • our amended and restated articles of association do not permit a director to be removed except by a vote of the holders of at least 65% of the total voting power of our shareholders and any amendment to such provision requires the approval of at least 65% of the total voting power of our shareholders; and • our amended and restated articles of association provide that director vacancies may be filled by our board of directors.
Our main competitors fall into the following categories: • traditional contingent workforce and staffing service providers and other outsourcing providers; 8 • online freelancer platforms that serve a diverse range of skill categories; • other online and offline providers of products and services that allow freelancers to find work or to advertise their services, including personal and professional social networks, employment marketplaces, recruiting websites, job boards, classified ads and other traditional means of finding work; • software and business services companies focused on talent acquisition, management or staffing management products and services; • businesses that provide specialized, professional services, including consulting, accounting, marketing and information technology services; and • software companies focused on providing technological solutions driven by artificial intelligence.
Our main competitors fall into the following categories: • traditional contingent workforce and staffing service providers and other outsourcing providers; • online freelancer platforms that serve a diverse range of skill categories; • other online and offline providers of products and services that allow freelancers to find work or to advertise their services, including personal and professional social networks, employment marketplaces, recruiting websites, job boards, classified ads and other traditional means of finding work; • software and business services companies focused on talent acquisition, management or staffing management products and services; • businesses that provide specialized, professional services, including consulting, accounting, marketing and information technology services; and • software companies focused on providing technological solutions driven by artificial intelligence.
In response to the foregoing developments, certain individuals, organizations and institutions, both within and outside of Israel, have voiced concerns that such proposed changes, if adopted, may negatively impact the business environment in Israel including due to reluctance of foreign investors to invest or transact business in Israel as well as to increased currency fluctuations, downgrades in credit rating, increased interest rates, increased volatility in security markets, and other changes in macroeconomic conditions.
In response to the foregoing developments, certain individuals, organizations and institutions, both within and outside of Israel, voiced concerns that such proposed changes, if adopted, may negatively impact the business environment in Israel including due to reluctance of foreign investors to invest or transact business in Israel as well as to increased currency fluctuations, downgrades in credit rating, increased interest rates, increased volatility in security markets, and other changes in macroeconomic conditions.
The second pillar, which includes two interlocking rules: (1) the Income Inclusion Rule, and (2) the Undertaxed Payment Rule, that together comprise the Global Anti-Base Erosion, or the GloBE rules, is focused on developing a global minimum tax rate of at least 15 percent applicable to in-scope multinational enterprises (with revenue in excess of Euro 750 million).
The second pillar, which includes two interlocking rules: (1) the Income Inclusion Rule, and (2) the Undertaxed Payment Rule, that together comprise the Global Anti-Base Erosion, or the GloBE rules, is focused on developing a global minimum tax rate of at least 15% applicable to in-scope multinational enterprises (with revenue in excess of Euro 750 million).
Further, our competitors could also independently develop technologies like ours, and our intellectual property rights may not be broad enough for us to prevent competitors from selling products and services incorporating those technologies. In order to protect our brand, we register and defend our trademarks and expend resources to prevent others from using the same or substantially similar marks.
Further, our competitors could also independently develop technologies like ours, and our intellectual property rights may not be broad enough for us to prevent competitors from selling products and services incorporating those technologies. 20 In order to protect our brand, we register and defend our trademarks and expend resources to prevent others from using the same or substantially similar marks.
If we fail to meet or exceed the expectations of investors or securities analysts, the trading price of our ordinary shares could fall substantially, and we could face costly lawsuits, including securities class action suits. 15 Our business is subject to a variety of laws and regulations, both in the United States and internationally, many of which are evolving.
If we fail to meet or exceed the expectations of investors or securities analysts, the trading price of our ordinary shares could fall substantially, and we could face costly lawsuits, including securities class action suits. Our business is subject to a variety of laws and regulations, both in the United States and internationally, many of which are evolving.
In the event of natural disaster or other catastrophic event, we may be unable to continue our operations and may endure system interruptions, reputational harm, delays in development of our platform, lengthy interruptions in service, breaches of data security and loss of critical data, all of which could have an adverse effect on our future operating results.
In the event of a natural disaster or other catastrophic event, we may be unable to continue our operations and may endure system interruptions, reputational harm, delays in development of our platform, lengthy interruptions in service, breaches of data security and loss of critical data, all of which could have an adverse effect on our future operating results.
The safeguards we have in place may not be sufficient to avoid harm to our brand, especially if such hostile, offensive or inappropriate use was high profile. If the market for freelancers and the services they offer is not sustained or develops more slowly than we expect, our growth may slow or stall.
The safeguards we have in place may not be sufficient to avoid harm to our brand, especially if such hostile, offensive or inappropriate use was high profile. 8 If the market for freelancers and the services they offer is not sustained or develops more slowly than we expect, our growth may slow or stall.
We can provide no assurances as to the financial stability or viability of any counterparty under the Capped Call Transactions. Risks relating to our ordinary shares We may need to raise additional funds to finance our future capital needs, which may dilute the value of our outstanding ordinary shares or prevent us from growing our business.
We can provide no assurances as to the financial stability or viability of any counterparty under the Capped Call Transactions. 29 Risks relating to our ordinary shares We may need to raise additional funds to finance our future capital needs, which may dilute the value of our outstanding ordinary shares or prevent us from growing our business.
All of the aforementioned risks may be augmented if our or our partners’ business continuity and disaster recovery plans prove to be inadequate. Currency exchange rate fluctuations affect our results of operations, as reported in our financial statements. We report our financial results in U.S. dollars. We collect our revenue primarily in U.S. dollars.
All of the aforementioned risks may be augmented if our or our partners’ business continuity and disaster recovery plans prove to be inadequate. 26 Currency exchange rate fluctuations affect our results of operations, as reported in our financial statements. We report our financial results in U.S. dollars. We collect our revenue primarily in U.S. dollars.
As a consequence of such claims, we could be required to pay additional remuneration or royalties to our current and/or former employees, or be forced to litigate such claims, which could negatively affect our business. 17 We may be vulnerable to intellectual property infringement claims brought against us by others.
As a consequence of such claims, we could be required to pay additional remuneration or royalties to our current and/or former employees, or be forced to litigate such claims, which could negatively affect our business. We may be vulnerable to intellectual property infringement claims brought against us by others.
The Patent Law also provides that if there is no such agreement between an employer and an employee, the Israeli Compensation and Royalties Committee (the “Committee”), a body constituted under the Patent Law, shall determine whether the employee is entitled to remuneration for his or her inventions.
The Patent Law also provides that if there is no such agreement between an employer and an employee, the Israeli Compensation and Royalties Committee, or the Committee, a body constituted under the Patent Law, shall determine whether the employee is entitled to remuneration for his or her inventions.
This activity could also cause or avoid an increase or a decrease in the market price of our ordinary shares. 24 In addition, we are subject to the risk that any of the counterparties to the Capped Call Transactions may default under the Capped Call Transactions.
This activity could also cause or avoid an increase or a decrease in the market price of our ordinary shares. In addition, we are subject to the risk that any of the counterparties to the Capped Call Transactions may default under the Capped Call Transactions.
We may be subject to legal proceedings and claims from time to time relating to the intellectual property of others in the ordinary course of our business. We may incur substantial expenses in defending against third party infringement claims, regardless of their merit.
We may be subject to legal proceedings and claims from time to time relating to the intellectual property of others in the ordinary course of our business. 21 We may incur substantial expenses in defending against third party infringement claims, regardless of their merit.
Furthermore, in recent years, Israel has been engaged in sporadic armed conflicts with Hamas, an Islamist terrorist group that controls the Gaza Strip, with Hezbollah, an Islamist terrorist group that controls large portions of southern Lebanon, and with Iranian-backed military forces in Syria.
In recent years, Israel has been engaged in sporadic armed conflicts with Hamas, an Islamist terrorist group that controls the Gaza Strip, with Hezbollah, an Islamist terrorist group that controls large portions of southern Lebanon, and with Iranian-backed military forces in Syria.
If we were involved in any similar litigation we could incur substantial costs and our management’s attention and resources could be diverted. 30 An active trading market for our ordinary shares may not be sustained to provide adequate liquidity. An active trading market may not be sustained for our ordinary shares.
If we were involved in any similar litigation we could incur substantial costs and our management’s attention and resources could be diverted. An active trading market for our ordinary shares may not be sustained to provide adequate liquidity. An active trading market may not be sustained for our ordinary shares.
We would be classified as a passive foreign investment company, or PFIC, for any taxable year if, after the application of certain look-through rules, either: (i) 75% or more of our gross income for such year is “passive income” (as defined in the relevant provisions of the Internal Revenue Code of 1986, as amended), or (ii) 50% or more of the value of our gross assets (generally determined on the basis of a quarterly average) during such year is attributable to assets that produce or are held for the production of passive income.
We would be classified as a passive foreign investment company, or PFIC, for any taxable year if, after the application of certain look-through rules, either: (i) 75% or more of our gross income for such year is “passive income” (as defined in the relevant provisions of the Internal Revenue Code of 1986, as amended, or the Code), or the income test; or (ii) 50% or more of the value of our assets (generally determined on the basis of a quarterly average) during such year is attributable to assets that produce or are held for the production of passive income, or the asset test.
If a natural disaster or other catastrophic event occurs in a region from which we derive a significant portion of our revenue, users in that region may delay or forego use of our platform, which may adversely impact our operating results.
If a natural disaster or other catastrophic event occurs in a region from which we derive a significant portion of our revenue, users in that region may delay or forego the use of our platform, which may adversely impact our operating results.
As a general matter, enforcement actions and sanctions could harm our business, results of operations and financial condition. General risk factors Our share price may be volatile, and you may lose all or part of your investment.
As a general matter, enforcement actions and sanctions could harm our business, results of operations and financial condition. 36 General risk factors Our share price may be volatile, and you may lose all or part of your investment.
We also engage a talented team in the United States and Ukraine to benefit from the significant pool of talent that is available in such markets, we have also witnessed increased competition in those markets.
We also engage a talented team in the United States and Ukraine to benefit from the significant pool of talent that is available in such markets, where we have also witnessed increased competition in those markets.
If we fail to attract new freelancers or our existing freelancers decrease their use of or cease using our platform, the quality or types of services provided by freelancers that use our platform are not satisfactory to buyers, or freelancers increase their fees for services beyond the level that buyers are willing to pay, buyers may decrease their use of, or cease using, our platform. 6 Key factors in attracting and retaining buyers include our ability to grow our brand awareness, attract and retain high-quality freelancers and increase the quantity and quality of Gigs posted on our core platform.
If we fail to attract new freelancers or our existing freelancers decrease their use of or cease using our platform, the quality or types of services provided by freelancers that use our platform are not satisfactory to buyers, or freelancers increase their fees for services beyond the level that buyers are willing to pay, buyers may decrease their use of, or cease using, our platform. 7 Key factors in attracting and retaining buyers include our ability to grow our brand awareness, attract and retain high-quality freelancers and increase the quantity and quality of Gigs posted on our core platform.
Moreover, the price of our ordinary shares could decline if one or more securities analysts downgrade our ordinary shares or if those analysts issue other unfavorable commentary or cease publishing reports about us or our business.
Moreover, the price of our ordinary shares could decline if one or more securities analysts downgrade our ordinary shares or if those analysts issue other unfavorable commentary or cease publishing reports about us or our business. 37
As a U.S. listed public company that is not a foreign private issuer, we will incur significant additional legal, accounting and other expenses that we will not incur as a foreign private issuer. 25 As we are a “foreign private issuer” and follow certain home country corporate governance practices, our shareholders may not have the same protections afforded to shareholders of companies that are subject to all NYSE corporate governance requirements.
As a U.S. listed public company that is not a foreign private issuer, we will incur significant additional legal, accounting and other expenses that we will not incur as a foreign private issuer. 30 As we are a “foreign private issuer” and follow certain home country corporate governance practices, our shareholders may not have the same protections afforded to shareholders of companies that are subject to all NYSE corporate governance requirements.
Under the Israeli Patent Law, 5727-1967 (the “Patent Law”), inventions conceived by an employee in the course and as a result of or arising from his or her employment with a company are regarded as “service inventions,” which belong to the employer, absent a specific agreement between the employee and employer giving the employee service invention rights.
Under the Israeli Patent Law, 5727-1967, or the Patent Law, inventions conceived by an employee in the course and as a result of or arising from his or her employment with a company are regarded as “service inventions,” which belong to the employer, absent a specific agreement between the employee and employer giving the employee service invention rights.
In the future, we would lose our foreign private issuer status if (1) more than 50% of our outstanding voting securities are owned by U.S. residents and (2) a majority of our directors or executive officers are U.S. citizens or residents, or we fail to meet additional requirements necessary to avoid loss of foreign private issuer status.
We may lose our foreign private issuer status in the future, if (1) more than 50% of our outstanding voting securities are owned by U.S. residents and (2) a majority of our directors or executive officers are U.S. citizens or residents, or we fail to meet additional requirements necessary to avoid loss of foreign private issuer status.
Laws outside of the United States and Israel regulating internet, payments, escrow, privacy and data protection, taxation, terms of service, website accessibility, consumer protection, intellectual property ownership, services intermediaries, labor and employment, worker classification, background checks and recruiting and staffing companies, among others, which could be interpreted to apply to us, are often less favorable to us than those in the United States and Israel, giving greater rights to competitors, users and other third parties.
Laws outside of the United States and Israel regulating internet, digital services, payments, escrow, privacy and data protection, artificial intelligence, taxation, terms of service, website accessibility, consumer protection, intellectual property ownership, services intermediaries, labor and employment, worker classification, background checks and recruiting and staffing companies, among others, which could be interpreted to apply to us, are often less favorable to us than those in the United States and Israel, giving greater rights to competitors, users and other third parties.
If AWS or other infrastructure providers increase the cost of their services, we may have to increase the fees to use our platform, and our business, prospects, financial condition and results of operations could be materially and adversely affected. 18 We face payment and fraud risks that could materially and adversely affect our business.
If AWS or other infrastructure providers increase the cost of their services, we may have to increase the fees to use our platform, and our business, prospects, financial condition and results of operations could be materially and adversely affected. 22 We face payment and fraud risks that could materially and adversely affect our business.
We rely on banks and card processors to provide clearing, processing and settlement functions for the secure and timely funding of all transactions on our platform. We also rely on a network of disbursement partners to hold and disburse funds to users. 19 Our payment partners are critical to our business.
Our payment partners consist of payment processors and disbursement partners. We rely on banks and card processors to provide clearing, processing and settlement functions for the secure and timely funding of all transactions on our platform. We also rely on a network of disbursement partners to hold and disburse funds to users. Our payment partners are critical to our business.
The determination of foreign private issuer status is made annually on the last business day of an issuer’s most recently completed second fiscal quarter, and, accordingly, the next determination will be made with respect to us on June 30, 2023.
The determination of foreign private issuer status is made annually on the last business day of an issuer’s most recently completed second fiscal quarter, and, accordingly, the next determination will be made with respect to us on June 30, 2024.
Emerging regulation that may require additional ESG public disclosures may increase the risk of such damage. In addition, any unfavourable media coverage or negative publicity about our industry or Company and any errors, defects, disruptions, security vulnerabilities, abuse of our system, or other performance problems with our products and platforms may also cause us reputational damage.
Regulation (including emerging regulation) may require additional ESG public disclosures and this may increase the risk of such damage. In addition, any unfavourable media coverage or negative publicity about our industry or Company and any errors, defects, disruptions, security vulnerabilities, abuse of our system, or other performance problems with our products and platforms may also cause us reputational damage.
As the enforcement supervisory authorities issue further guidance on personal data export mechanisms, including circumstances where the standard contractual clauses cannot be used, and/or start taking enforcement action, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we provide our services, the geographical location or segregation of our relevant systems and operations, and could adversely affect our financial results.
As the enforcement supervisory authorities issue further guidance on personal data export mechanisms, including circumstances where certain data transfer mechanism cannot be used, and/or start taking enforcement action, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or if we are otherwise unable to transfer personal data between and among countries and regions in which we operate, it could affect the manner in which we provide our services, the geographical location or segregation of our relevant systems and operations, and could adversely affect our financial results.
“Taxation—Taxation and government programs—Israeli tax considerations and government programs—Law for the Encouragement of Capital Investments, 5719-1959.” It may be difficult to enforce a U.S. judgment against us, our officers and directors named in this Annual Report in Israel or the United States, or to assert U.S. securities laws claims in Israel or serve process on our officers and directors.
See Item 10.E. ”Taxation—Taxation and government programs—Israeli tax considerations and government programs—Law for the Encouragement of Capital Investments, 5719-1959.” It may be difficult to enforce a U.S. judgment against us, our officers and directors named in this Annual Report in Israel or the United States, or to assert U.S. securities laws claims in Israel or serve process on our officers and directors.
Further, there have been changes to tax laws in the United States (such as the recent United States Inflation Reduction Act which, among other changes, introduced a 15% corporate minimum tax on certain United States corporations and a 1% excise tax on certain stock redemptions by United States corporations, which the U.S.
Further, there have been changes to tax laws in the United States (such as the United States Inflation Reduction Act of 2022, which, among other changes, introduced a 15% corporate minimum tax on certain United States corporations and a 1% excise tax on certain stock redemptions by United States corporations, which the U.S.
The Companies Law imposes restrictions on our ability to declare and pay dividends. Payment of dividends may also be subject to Israeli withholding taxes. See Item 10.E. “Taxation—Taxation and government programs—Israeli tax considerations and government programs” for more information.
The Israeli Companies Law, 5759-1999, or the Companies Law, imposes restrictions on our ability to declare and pay dividends. Payment of dividends may also be subject to Israeli withholding taxes. See Item 10.E. ”Taxation—Taxation and government programs—Israeli tax considerations and government programs” for more information.
The market price of our ordinary shares could be highly volatile and may fluctuate substantially as a result of many factors, including: • actual or anticipated fluctuations in our results of operations; • variance in our financial performance from the expectations of market analysts; • announcements by us or our competitors of significant business developments, changes in service provider relationships, acquisitions or expansion plans; • short selling activities; • changes in our take rate; • our involvement in litigation; • our sale of ordinary shares or other securities in the future; • market conditions in our industry; • changes in key personnel; • the trading volume of our ordinary shares; • changes in the estimation of the future size and growth rate of our markets; • general economic and market conditions; and • general economic and market conditions.
The market price of our ordinary shares could be highly volatile and may fluctuate substantially as a result of many factors, including: • actual or anticipated fluctuations in our results of operations; • variance in our financial performance from the expectations of market analysts; • announcements by us or our competitors of significant business developments, changes in service provider relationships, acquisitions or expansion plans; • short selling activities; • changes in our take rate; • our involvement in litigation; • our sale of ordinary shares or other securities in the future; • market conditions in our industry; • changes in key personnel; • the trading volume of our ordinary shares; • changes in the estimation of the future size and growth rate of our markets; and • general economic and market conditions, including the wars between Israel and Hamas and between Russia and Ukraine.
Such claims could result in monetary damages or other liability, and any adverse determination, including potentially the requirement for us to indemnify a user, could also harm our brand, which could materially and adversely affect our business, prospects, financial condition and results of operations. The application of indirect taxes could adversely affect our business and results of operations.
Such claims could result in monetary damages or other liability, and any adverse determination, including potentially the requirement for us to indemnify a user, could also harm our brand, which could materially and adversely affect our business, prospects, financial condition and results of operations. 25 The application of indirect taxes, other tax laws or regulation could adversely affect our business and results of operations.
In January 2019 the OECD announced further work in continuation of the BEPS project, focusing on two “pillars.” On October 8, 2021, 136 countries approved a statement known as the OECD BEPS Inclusive Framework, which builds upon the OECD’s continuation of the BEPS project.
In January 2019 the OECD announced further work in continuation of the BEPS project, focusing on two “pillars”. On October 8, 2021, 136 countries approved a statement known as the OECD BEPS Inclusive Framework, which builds upon the OECD’s continuation of the BEPS project.
In addition, we regularly maintain cash, cash equivalents and bank deposits at financial institutions in the United States, Israel and other multi-national institutions. Our funds at these institutions exceed insured limits and some are not insured at all.
In addition, we regularly maintain cash, cash equivalents and bank deposits at financial institutions in the United States, Israel and other multinational institutions. Our funds at these institutions exceed insured limits and some are not insured at all.
Our operating results in any given quarter can be influenced by numerous factors, many of which are unpredictable or are outside of our control, including: • our ability to maintain and grow our community of users; • the demand for and types of skills and services that are offered on our platform by freelancers; • spending patterns of buyers, including whether those buyers who use our platform frequently, or for larger services, reduce their spend or stop using our platform; • seasonal spending patterns by buyers or work patterns by freelancers and seasonality in the labor market; • fluctuations in the prices that freelancers charge buyers on our platform; • changes to our pricing model; • our ability to introduce new features and services and enhance our existing platform and our ability to generate significant revenue from new features and services; • our ability to respond to competitive developments, including pricing changes and the introduction of new products and services by our competitors; • the impact of outages of our platform and associated reputational harm; • changes to financial accounting standards and the interpretation of those standards that may affect the way we recognize and report our financial results; • increases in, and timing of, operating expenses that we may incur to grow and expand our business and to remain competitive; • costs related to the acquisition of businesses, talent, technologies, or intellectual property, including potentially significant amortization costs and possible impairments; • security or data privacy breaches and associated remediation costs; • litigation, adverse judgments, settlements, or other litigation-related costs; • changes in the common law, statutory, legislative, or regulatory environment, such as with respect to privacy and data protection, wage and hour regulations, worker classification (including classification of independent contractors or similar service providers and classification of employees as exempt or non-exempt), internet regulation, payment processing, global trade, or tax requirements; • fluctuations in currency exchange rates; • general economic and political conditions and government regulations in the countries where we currently have significant numbers of users, or where we currently operate or may expand in the future; and • the COVID-19 pandemic or other pandemics, epidemics or global health emergencies.
Our operating results in any given quarter can be influenced by numerous factors, many of which are unpredictable or are outside of our control, including: • our ability to maintain and grow our community of users; • the demand for and types of skills and services that are offered on our platform by freelancers; • spending patterns of buyers, including whether those buyers who use our platform frequently, or for larger services, reduce their spend or stop using our platform; • seasonal spending patterns by buyers or work patterns by freelancers and seasonality in the labor market; • fluctuations in the prices that freelancers charge buyers on our platform; • changes to our pricing model; 17 • our ability to introduce new features and services and enhance our existing platform and our ability to generate significant revenue from new features and services; • our ability to respond to competitive developments, including pricing changes and the introduction of new products and services by our competitors; • the impact of outages of our platform and associated reputational harm; • changes to financial accounting standards and the interpretation of those standards that may affect the way we recognize and report our financial results; • increases in, and timing of, operating expenses that we may incur to grow and expand our business and to remain competitive; • costs related to the acquisition of businesses, talent, technologies, or intellectual property, including potentially significant amortization costs and possible impairments; • security or data privacy breaches and associated remediation costs; • litigation, adverse judgments, settlements, or other litigation-related costs; • changes in the common law, statutory, legislative, or regulatory environment, such as with respect to privacy and data protection, wage and hour regulations, worker classification (including classification of independent contractors or similar service providers and classification of employees as exempt or non-exempt), internet regulation, payment processing, global trade, or tax requirements; • fluctuations in currency exchange rates, inflation and interest rates; • general economic and political conditions and government regulations in the countries where we currently have significant numbers of users, or where we currently operate or may expand in the future; • catastrophic events in countries where we currently have significant numbers of users, or where we currently operate, which could lead to power and Internet shortages, that could prevent users from the ability to use our platform; • geopolitical risks such as the wars between Israel and Hamas and between Russia and Ukraine; and • pandemics, epidemics or global health emergencies.
We maintain substantial balances of liquid investments, for purposes of financing our operations and acquisitions. Our marketable securities totalled $431.1 million as of December 31, 2022. The performance of the capital markets affects the values of funds that are held in marketable securities.
We maintain substantial balances of liquid investments, for purposes of financing our operations and acquisitions. Our marketable securities totalled $476.1 million as of December 31, 2023. The performance of the capital markets affects the values of funds that are held in marketable securities.
Our business may suffer if we do not successfully manage our current and potential future growth. We have grown significantly in recent years, and we intend to continue to expand the scope and geographic reach of our platform. Our anticipated future growth will likely place significant demands on our management and operations.
Our business may suffer if we do not successfully manage our current and potential future growth. We have grown significantly in scale since inception, and we intend to continue to expand the scope and geographic reach of our platform. Our anticipated future growth will likely place significant demands on our management and operations.
During the year ended December 31, 2022, the NIS depreciated in relation to the U.S. dollar by 13.2%, while during the years ended December 31, 2021, and 2020 the NIS appreciated in relation to the U.S. dollar by 3.3% and 7.7%, respectively. 22 Our investment portfolio and other funds may be adversely affected by market conditions and interest rates.
During the years ended December 31, 2023 and 2022, the NIS depreciated in relation to the U.S. dollar by 3.1% and 13.2%, respectively, while during the year ended December 31, 2021 the NIS appreciated in relation to the U.S. dollar by 3.3%. Our investment portfolio and other funds may be adversely affected by market conditions and interest rates.
We are also subject to the terms of our privacy policies and certain contractual obligations to third parties related to privacy, data protection and data security. We strive to comply with our policies and applicable laws, regulations, contractual obligations and other legal obligations relating to privacy, data protection and data security to the extent possible.
We are also subject to the terms of our privacy policies and certain contractual obligations to third parties related to privacy, data protection and data security. We are committed to complying with our policies and applicable laws, regulations, contractual obligations and other legal obligations relating to privacy, data protection and data security to the extent possible.
Risks relating to our business and industry Adverse macroeconomic conditions can materially adversely affect the Company’s business, results of operations and financial condition, due to impacts on consumer and business spending and demand for our services Adverse macroeconomic conditions, including recent inflation, slower growth or recession, changes to fiscal and monetary policy, tighter credit, higher interest rates, high unemployment, currency fluctuations and the current war between Russia and Ukraine, have affected the U.S. and global economy during 2022 and can adversely impact consumer and businesses confidence and spending and materially adversely affect demand for the digital services offered on the Company’s platform.
Risks relating to our business and industry Adverse macroeconomic conditions can materially adversely affect the Company’s business, results of operations and financial condition, due to impacts on consumer and business spending and demand for our services Adverse macroeconomic conditions, including recent inflation, slower growth or recession, changes to fiscal and monetary policy, tighter credit, higher interest rates, high unemployment, currency fluctuations, increased geopolitical risks such as the current wars between Israel and Hamas and between Russia and Ukraine, have affected the U.S. and global economy during 2023 and can adversely impact consumer and businesses confidence and spending and materially adversely affect demand for the digital services offered on the Company’s platform.
Where we transfer personal data outside the European Economic Area to a country that is not deemed to be “adequate,” we rely on transfer mechanisms available under relevant local law.
Where we transfer personal data outside the European Economic Area to a country that is not deemed to be “adequate,” we rely on transfer mechanisms available under applicable privacy law.
If we are or have at any point in time been in violation of one or more escrow or money transmitter or other similar statutes or regulatory requirements related to the handling or moving of money in any jurisdiction, we may be subject to the imposition of fines, users in the relevant jurisdiction may be unable to use our platform, we may be subject to civil liability or criminal liability and our business, prospects, financial condition and results of operations could be materially and adversely affected.
If we are or have at any point in time been in violation of one or more escrow or money transmitter or other similar statutes or regulatory requirements related to the handling or moving of money in any jurisdiction, we may be subject to the imposition of fines, users in the relevant jurisdiction may be unable to use our platform, we may be subject to civil liability or criminal liability and our business, prospects, financial condition and results of operations could be materially and adversely affected. 23 If we are unable to maintain our payment partners and bank relationships, or if our disbursement partners encounter business difficulties, our business could be materially and adversely affected.
Moreover, the CCPA, CPRA and VCDPA and eventually the CTDPA, CPA and UCPA and other legal and regulatory developments are making it easier for individuals protected by those laws to opt-out of having their personal data processed and disclosed to third parties through various opt-out mechanisms, and, more generally, provide them more control of their data, which could result in an increase to our operational costs to ensure compliance with such legal and regulatory changes.
Moreover, the CCPA and other state laws, as well as other legal and regulatory developments are making it easier for individuals protected by those laws to opt-out of having their personal data processed and disclosed to third parties through various opt-out mechanisms, and more generally, provide them more control of their data, which could result in an increase to our operational costs to ensure compliance with such legal and regulatory changes.
These new taxes include DSTs of the type originally proposed plus, in certain jurisdictions, greatly expanded DSTs that apply to virtually all digital transactions, including on multi-sided interfaces allowing users to connect. These taxes defer between jurisdictions in terms of thresholds, applicable tax rate and scope. Note that in most jurisdictions the DST is applied on the gross revenues.
These new taxes include DSTs of the type originally proposed plus, in certain jurisdictions, greatly expanded DSTs that apply to virtually all digital transactions, including on multi-sided interfaces allowing users to connect. These taxes defer between jurisdictions in terms of thresholds, applicable tax rate and scope.
“ Taxation—Taxation and government programs—United States federal income taxation—Passive Foreign Investment Company considerations .” If a United States person is treated as owning at least 10% of our ordinary shares such holder may be subject to adverse U.S. federal income tax consequences.
For further discussion, see Item 10.E. “ Taxation— Taxation and government programs—United States federal income taxation—Passive Foreign Investment Company considerations. ” 31 If a United States person is treated as owning at least 10% of our ordinary shares such holder may be subject to adverse U.S. federal income tax consequences.
The Israeli annual rate of inflation amounted to 5.3%, 2.8%, and negative 0.7% for the years ended December 31, 2022, 2021 and 2020, respectively.
The Israeli annual rate of inflation amounted to 3.0%, 5.3%, and 2.8% for the years ended December 31, 2023, 2022 and 2021, respectively.
While we currently employ various antivirus and computer protection software in our operations, we cannot assure that such protections will in all cases successfully prevent hacking or the transmission of any computer virus or malware, which could result in significant damage to our hardware and software systems and databases, disruptions to our business activities, including to our e-mail and other communications systems, breaches of security and the inadvertent disclosure of personal, confidential or sensitive data, interruptions in access to our website through the use of “denial of service” or similar attacks and other material adverse effects on our operations.
While we currently employ various antivirus and computer protection software in our operations, we cannot assure that such protections will in all cases successfully prevent hacking or the transmission of any computer virus or malware, which could result in significant damage to our hardware and software systems and databases, disruptions to our business activities, including to our e-mail and other communications systems, breaches of security and the inadvertent disclosure of personal, confidential or sensitive data, interruptions in access to our website through the use of “denial of service” or similar attacks and other material adverse effects on our operations. 11 Further, we may need to expend significant resources to protect against, and to address issues created by, security breaches and other incidents.
If our brand is harmed, whether due to negative publicity resulting from ESG matters or otherwise, we may not be able to grow or maintain our freelancer base, and our business, prospects, financial condition and results of operations could be materially and adversely affected.
If our brand is harmed due to negative publicity we may not be able to grow or maintain our freelancer base, and our business, prospects, financial condition and results of operations could be materially and adversely affected.
The rights and responsibilities of holders of our ordinary shares are governed by our amended and restated articles of association and the Israeli Companies Law, 5759-1999, or the Companies Law. These rights and responsibilities differ in some respects from the rights and responsibilities of shareholders in typical U.S. corporations.
We are incorporated under Israeli law. The rights and responsibilities of holders of our ordinary shares are governed by our amended and restated articles of association and the Companies Law. These rights and responsibilities differ in some respects from the rights and responsibilities of shareholders in typical U.S. corporations.
If the market for freelancers and the services they offer does not achieve widespread adoption, or there is a reduction in demand for freelancer services, particularly demand for information technology services, including as a result of macroeconomic conditions related to a global recession or otherwise, our business, prospects, financial condition and results of operations could be materially and adversely affected. 7 If traffic to our websites declines for any reason, our growth may slow or stall.
If the market for freelancers and the services they offer does not achieve widespread adoption, or there is a reduction in demand for freelancer services, particularly demand for information technology services, including as a result of macroeconomic conditions related to a global recession or otherwise, our business, prospects, financial condition and results of operations could be materially and adversely affected.
While we have experienced strong growth in the number of active buyers on our platform in the past few years, the rate of growth was volatile and could differ significantly from one year to another. Many factors impact the buyer growth , and we cannot accurately predict or guarantee active buyer growth rates in the future.
While we have experienced strong growth in the number of active buyers on our platform since inception, the rate of growth in recent years has been volatile and could differ significantly from one year to another. Many factors impact the buyer growth, and we cannot accurately predict or guarantee active buyer growth rates in the future.
If one or more holders elect to convert their Convertible Notes, unless we elect to satisfy our conversion obligation by delivering solely ordinary shares (other than paying cash in lieu of delivering any fractional ordinary share), we would be required to settle a portion or all of our conversion obligation through the payment of cash, which could adversely affect our liquidity.
If one or more holders elect to convert their Convertible Notes, unless we elect to satisfy our conversion obligation by delivering solely ordinary shares (other than paying cash in lieu of delivering any fractional ordinary share), we would be required to settle a portion or all of our conversion obligation through the payment of cash, which could adversely affect our liquidity. 28 The fundamental change repurchase right of the Convertible Notes, if triggered, may adversely affect our financial condition and operating results.
More generally, some observers have noted the CCPA, CPRA, VCDPA, CTDPA, CPA and UCPA could mark the beginning of a trend toward more stringent United States federal privacy legislation, which could increase our potential liability and adversely affect our business.
More generally, some observers have noted the CCPA and other state laws could mark the beginning of a trend toward more stringent United States federal privacy legislation, which could increase our potential liability and adversely affect our business.
Specifically, the GDPR and other European and UK data protection laws generally prohibit the transfer of personal data from Europe, including the European Economic Area, United Kingdom and Switzerland, to third party countries, unless the transfer is to a country deemed to provide adequate protection (such as Israel, as the EU Commission has issued a decision on the adequacy of the level of protection of personal data in Israel) or the parties to the transfer have implemented specific safeguards to protect the transferred personal data.
Specifically, the GDPR and other European and UK data protection laws generally prohibit the transfer of personal data from Europe, including the European Economic Area, United Kingdom and Switzerland, to third party countries, unless the transfer is to a country deemed to provide adequate protection (such as Israel, which was re-affirmed by the EU Commission on January 15, 2024, confirming the adequacy of the level of protection of personal data in Israel as an “adequate” country) or the parties to the transfer have implemented specific safeguards to protect the transferred personal data.
We also cannot predict whether any new features will be well received by users, or whether improving our platform will be successful or sufficient to offset the costs incurred to offer these new features.
We provide no assurances that our initiatives to improve our user experience will be successful. We also cannot predict whether any new features will be well received by users, or whether improving our platform will be successful or sufficient to offset the costs incurred to offer these new features.
If we fail to attract new users or fail to maintain existing users, our revenue may grow more slowly than expected and our business could be materially and adversely affected. We have incurred operating losses in the past, expect to incur operating losses in the future and may never achieve or maintain profitability.
If we fail to attract new users or fail to maintain existing users, our revenue may grow more slowly than expected and our business could be materially and adversely affected. We have incurred net losses in the past, and may not be able to generate sufficient revenue to achieve or maintain profitability.
Companies and brands that do not adapt to or comply with expectations, standards, and regulations on ESG matters as they continue to evolve, which are perceived to have not responded appropriately to the growing concern for ESG issues, regardless of whether there is a legal requirement to do so, or which are alleged to not achieve the ESG standards, targets or commitments that they publicly state (often referred to as “greenwashing”), may suffer from reputational damage.
Companies and brands that do not adapt to or comply with expectations, standards, and regulations on ESG matters as they continue to evolve, which are perceived to have not responded appropriately in relation to ESG issues, or which are alleged to not achieve the ESG standards, targets or commitments that they publicly state (often referred to as “greenwashing”), may suffer from reputational damage.
Moreover, an Israeli court will not enforce a non-Israeli judgment if it was given in a state whose laws do not provide for the enforcement of judgments of Israeli courts (subject to exceptional cases), if its enforcement is likely to prejudice the sovereignty or security of the State of Israel, if it was obtained by fraud or in the absence of due process, if it is at variance with another valid judgment that was given in the same matter between the same parties, or if a suit in the same matter between the same parties was pending before a court or tribunal in Israel at the time the foreign action was brought.
Moreover, an Israeli court will not enforce a non-Israeli judgment if it was given in a state whose laws do not provide for the enforcement of judgments of Israeli courts (subject to exceptional cases), if its enforcement is likely to prejudice the sovereignty or security of the State of Israel, if it was obtained by fraud or in the absence of due process, if it is at variance with another valid judgment that was given in the same matter between the same parties, or if a suit in the same matter between the same parties was pending before a court or tribunal in Israel at the time the foreign action was brought. 35 Your rights and responsibilities as our shareholder are governed by Israeli law, which may differ in some respects from the rights and responsibilities of shareholders of U.S. corporations.
Our ability to maintain the number of visitors directed to our websites is not entirely within our control. We depend in part on various internet search engines and other channels to direct a significant number of users to our website.
If traffic to our websites declines for any reason, our growth may slow or stall. Our ability to maintain the number of visitors directed to our websites is not entirely within our control. We depend in part on various internet search engines and other channels to direct a significant number of users to our website.
Although the Israeli government currently covers the reinstatement value of direct damages that are caused by terrorist attacks or acts of war, we cannot assure you that this government coverage will be maintained or that it will sufficiently cover our potential damages. Any losses or damages incurred by us could have a material adverse effect on our business.
Although the Israeli government currently covers the reinstatement value of direct damages that are caused by terrorist attacks or acts of war, we cannot assure you that this government coverage will be maintained or that it will sufficiently cover our potential damages.
In order for us to successfully compete and grow, we must attract, recruit, retain and develop personnel with requisite qualifications to provide expertise across the entire spectrum of our intellectual capital and business needs.
We compete in a market marked by rapidly changing technologies and an evolving competitive landscape. In order for us to successfully compete and grow, we must attract, recruit, retain and develop personnel with requisite qualifications to provide expertise across the entire spectrum of our intellectual capital and business needs.
In particular, in recent years, increasing attention has been given to corporate activities related to environmental, social and governance (ESG) matters including increasing attention on and demands for action related to climate change and diversity, equity and inclusion matters.
In particular, in recent years, increasing attention has been given to corporate activities related to environmental, social and governance (ESG) matters including increasing attention on climate change and diversity, equity and inclusion matters, from stakeholders with varied views on these topics.
We have in the past acquired and may in the future acquire certain complementary businesses or technologies. For example, during 2021 we have acquired Working Not Working, Inc., CreativeLive, Inc. and Stoke Talent Ltd.
We may not be able to successfully execute future acquisitions or efficiently manage any acquired business. We have in the past acquired and may in the future acquire certain complementary businesses or technologies. For example, during 2021 we have acquired Working Not Working, Inc., CreativeLive, Inc. and Stoke Talent Ltd.
In addition, as of December 31, 2022, we had 701,205 shares available for sale under our 2020 Employee Share Purchase Plan. We may be classified as a passive foreign investment company, which could result in adverse U.S. federal income tax consequences to U.S. Holders of our ordinary shares.
In addition, as of December 31, 2023, we had 1,004,211 shares available for sale under our 2020 Employee Share Purchase Plan. There can be no assurance that we will not be classified as a passive foreign investment company, which could result in adverse U.S. federal income tax consequences to U.S. Holders of our ordinary shares.
As a foreign private issuer, we have the option to follow certain home country corporate governance practices rather than those of the NYSE, provided that we disclose the requirements we are not following and describe the home country practices we are following.
As a foreign private issuer, we have the option to follow certain home country corporate governance practices rather than those of the NYSE, provided that we disclose the requirements we are not following and describe the home country practices we are following. We rely on this “foreign private issuer exemption” with respect to the NYSE rules for shareholder meeting quorums.
We may be unable to enforce these agreements under Israeli law, and it may be difficult for us to restrict our competitors from benefiting from the expertise our former employees developed while working for us.
These agreements prohibit our employees, if they cease working for us, from competing directly with us or working for our competitors for a limited period. We may be unable to enforce these agreements under Israeli law, and it may be difficult for us to restrict our competitors from benefiting from the expertise our former employees developed while working for us.
Third parties may obtain, copy, reverse engineer or use without our authorization our intellectual property, which includes trademarks related to our brand, platform, registered domain names, trade secrets and other intellectual property rights and licenses.
To date, we have not sought patent protection for our platform or any portion of it. Third parties may obtain, copy, reverse engineer or use without our authorization our intellectual property, which includes trademarks related to our brand, platform, registered domain names, trade secrets and other intellectual property rights and licenses.
The application of indirect taxes, such as sales and use tax, to our business is a complex and evolving issue. Significant judgment is required to evaluate applicable tax obligations. As a result, amounts recorded may be subject to adjustments by the relevant tax authorities.
The application of indirect taxes, such as sales tax, use tax, value-added tax, gross receipts tax, and digital services tax, to our business is an evolving issue that requires ongoing judgment to evaluate our applicable tax obligations. As a result, amounts recorded may be subject to adjustments by the relevant tax authorities.
Actual or perceived political instability in Israel or any negative changes in the political environment, may individually or in the aggregate adversely affect the Israeli economy and, in turn, our business, financial condition, results of operations, and prospects.
A campaign of boycotts, divestment, and sanctions has been undertaken against Israel, which could also adversely affect our business. Actual or perceived political instability in Israel or any negative changes in the political environment, may individually or in the aggregate adversely affect the Israeli economy and, in turn, our business, financial condition, results of operations, and prospects.
The Company’s ability to maintain and grow its business will be impaired if mobile connected devices, mobile operating systems, networks, standards and content distribution channels, which are run by operating system providers and app stores, develop in ways that prevent the Company’s products and services from being delivered to their users. 12 Parties that control operating systems, such as Apple or Google frequently introduce new technology, and from time to time, they may introduce new operating systems or modify existing ones.
The Company’s ability to maintain and grow its business will be impaired if mobile connected devices, mobile operating systems, networks, standards and content distribution channels, which are run by operating system providers and app stores, develop in ways that prevent the Company’s products and services from being delivered to their users.
We believe that maintaining and enhancing our brand are of significant importance to the success of our business. A well-recognized brand is critical to increasing the number and the level of engagement of freelancers and, in turn, enhancing our attractiveness to buyers.
A well-recognized brand is critical to increasing the number and the level of engagement of freelancers and, in turn, enhancing our attractiveness to buyers.
It is possible that disputes may arise between buyers and freelancers with regard to the terms of their order, service standards, payment, confidentiality, work product and intellectual property ownership and infringement.
Buyers and freelancers are free to negotiate any specific terms they choose through custom offers sent from the conversation page. It is possible that disputes may arise between buyers and freelancers with regard to the terms of their order, service standards, payment, confidentiality, work product and intellectual property ownership and infringement.
This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. 27 We are required to comply with the SEC’s rules implementing Sections 302 and 404 of the Sarbanes-Oxley Act, which require management to certify financial and other information in our annual reports and provide an annual management report on the effectiveness of control over financial reporting.
We are required to comply with the SEC’s rules implementing Sections 302 and 404 of the Sarbanes-Oxley Act, which require management to certify financial and other information in our annual reports and provide an annual management report on the effectiveness of control over financial reporting.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

84 edited+30 added−26 removed45 unchanged
Biggest changeData protection and cybersecurity We hold certain personal data of our users, including their name, username, email address, IP address, device identifiers, address, telephone number, photo, transactional data, consumption habits (such as purchase history), taxpayer information and forms, profession and education, location, authentication information, social media account log in details and additional information regarding the use of Fiverr’s Marketplace (such as published portfolio, Gig information, purchases, ratings and additional information the user decides to upload and share with us or other users of our marketplace), and may hold certain personal data of the visitors to our users’ websites.
Biggest changeIn addition, rising concern about the use of the Internet for illegal conduct, such as the unauthorized dissemination of national security information, money laundering or supporting terrorist activities may in the future produce legislation or other governmental action that could require changes to our products or services, restrict or impose additional costs upon the conduct of our business or cause users to abandon material aspects of our service. 52 Data protection and cybersecurity We hold certain personal data of our users, including their name, username, email address, IP address, device identifiers, address, telephone number, photo, transactional data, consumption habits (such as purchase history), taxpayer information and forms, profession and education, location, authentication information (including copy of identification documents), social media account log in details and additional information regarding the use of Fiverr’s marketplace (such as published portfolio, Gig information, purchases, ratings and additional information the user decides to upload and share with us or other users of our marketplace), and may hold certain personal data of the visitors to our users’ websites.
Our main competitors fall into the following categories: • Traditional contingent workforce and staffing service providers and other outsourcing providers; • Online freelancer platforms that serve a diverse range of skill categories; • Other online and offline providers of products and services that allow freelancers to find work or to advertise their services, including personal and professional social networks, employment marketplaces, recruiting websites, job boards, classified ads and other traditional means of finding work; • Software and business services companies focused on talent acquisition, management, invoicing, or staffing management products and services; • Businesses that provide specialized, professional services, including consulting, accounting, marketing and information technology services; and • Software companies focused on providing technological solutions driven by artificial intelligence.
Our main competitors fall into the following categories: • traditional contingent workforce and staffing service providers and other outsourcing providers; • online freelancer platforms that serve a diverse range of skill categories; • other online and offline providers of products and services that allow freelancers to find work or to advertise their services, including personal and professional social networks, employment marketplaces, recruiting websites, job boards, classified ads and other traditional means of finding work; • software and business services companies focused on talent acquisition, management, invoicing, or staffing management products and services; 51 • businesses that provide specialized, professional services, including consulting, accounting, marketing and information technology services; and • software companies focused on providing technological solutions driven by artificial intelligence.
Our innovative catalog of productized services allows us to create an e-commerce-like experience with digital services that includes search, browse, compare and purchase functions. 39 Scalable, modular and modern technology platform . Our platform is built as a collection of modules that can be individually modified or added without redeploying the entire code base.
Our innovative catalog of productized services allows us to create an e-commerce-like experience with digital services that includes search, browse, compare and purchase functions. Scalable, modular and modern technology platform . Our platform is built as a collection of modules that can be individually modified or added without redeploying the entire code base.
We provide access to a robust set of technology tools for our sellers that enable them to manage all of the administrative aspects of their business, such as providing standardized contracts, invoicing and payment, financial reporting, marketing and real-time performance feedback. This infrastructure allows our sellers to track their performance and manage their business efficiently. 33 Success management and support.
We provide access to a robust set of technology tools for our sellers that enable them to manage all of the administrative aspects of their business, such as providing standardized contracts, invoicing and payment, financial reporting, marketing and real-time performance feedback. This infrastructure allows our sellers to track their performance and manage their business efficiently. Success management and support.
As EU Member States still need to adopt the NIS 2 Directive into national law by October 17, 2024, it is difficult to assess the impact on our business or operations, but it may require us to modify our cybersecurity practices and policies and we could incur substantial costs as a result. 44 C.
As EU Member States still need to adopt the NIS 2 Directive into national law by October 17, 2024, it is difficult to assess the impact on our business or operations, but it may require us to modify our cybersecurity practices and policies and we could incur substantial costs as a result. C.
With each buyer interaction, our platform and machine learning algorithms enable us to offer more personalized recommendation carousels that are presented in relevant places along the buyer journey. Personalizable options. We believe many of our buyers are motivated by more than simply price and convenience; we believe they also value uniqueness and authenticity.
With each buyer interaction, our platform and machine learning algorithms enable us to offer more personalized recommendation carousels that are presented in relevant places along the buyer journey. 42 Personalizable options. We believe many of our buyers are motivated by more than simply price and convenience; we believe they also value uniqueness and authenticity.
We actively work to expand our wallet share by encouraging cross category purchasing, suggesting services appropriate for the respective business lifecycle and constantly improving how we match our buyer’s needs with our seller’s offerings. 41 Intellectual property We design, test and update our website and apps regularly, and we have developed our proprietary solutions in-house.
We actively work to expand our wallet share by encouraging cross category purchasing, suggesting services appropriate for the respective business lifecycle and constantly improving how we match our buyer’s needs with our seller’s offerings. Intellectual property We design, test and update our website and apps regularly, and we have developed our proprietary solutions in-house.
We are data-centric and rely on data from disciplined A/B testing, buyer and seller studies and other sources to inform all of our decisions on new platform enhancements. Our search algorithm uses our large data set from our Gigs, transactions and users to optimize Gig matches and user experience for our buyers. 40 Clear and simple cross-platform user experience .
We are data-centric and rely on data from disciplined A/B testing, buyer and seller studies and other sources to inform all of our decisions on new platform enhancements. Our search algorithm uses our large data set from our Gigs, transactions and users to optimize Gig matches and user experience for our buyers. Clear and simple cross-platform user experience .
For certain categories and gigs, we also allow buyers to make recurring purchases through the Subscriptions feature, or to break down a large project into multiple purchases through the Milestones feature. 34 Communication and collaboration. Communication between buyers and sellers is essential to the success of our marketplace. Our messenger tool enables buyers to easily communicate with sellers.
For certain categories and gigs, we also allow buyers to make recurring purchases through the Subscriptions feature, or to break down a large project into multiple purchases through the Milestones feature. Communication and collaboration. Communication between buyers and sellers is essential to the success of our marketplace. Our messenger tool enables buyers to easily communicate with sellers.
These include the necessity to have lawful legal basis for collecting, using, and processing personal data, ​​requirements in light of the transparency principle to tell our users how we may use their personal data, increased controls on profiling users, increased rights for users to access, control and delete their personal data and mandatory data breach notification requirements.
These include the necessity to have lawful basis for collecting, using, and processing personal data, ​​requirements in light of the transparency principle to tell our users how we may use their personal data, increased controls on profiling users, increased rights for users to access, control and delete their personal data and mandatory data breach notification requirements.
We hold numerous registered trademarks in the United States and in foreign jurisdictions, including the European Union, the United Kingdom, Australia, Brazil and Israel, that we consider material to the marketing of our products, including the trademarks Fiverr and Gig. Our in-house know-how is an important element of our intellectual property.
We hold numerous registered trademarks in the United States and in foreign jurisdictions, including the European Union, the United Kingdom, Australia, Brazil, Canada and Israel, that we consider material to the marketing of our products, including the trademarks Fiverr and Gig. Our in-house know-how is an important element of our intellectual property.
We believe that our model reduces friction and uncertainties for our buyers while enabling our sellers to reach a global audience, enjoy more flexibility and choice of work and make more money. The key elements of our core platform include: Service-as-a-Product model.
We believe that our model reduces friction and uncertainties for our buyers while enabling our sellers to reach a global audience, enjoy more flexibility and choice of work and make more money. The key elements of our platform include: Service-as-a-Product model.
In this respect, the new Israeli Privacy Protection Regulations (Data Security) 2017, or the Data Security Regulations, imposes obligations with respect to the manner personal data is processed, maintained, transferred, disclosed, accessed and secured.
In this respect, the Israeli Privacy Protection Regulations (Data Security) 2017, or the Data Security Regulations, imposes obligations with respect to the manner personal data is processed, maintained, transferred, disclosed, accessed and secured.
In the European Union, informed consent is required for the placement of certain cookies on a user’s device and for direct electronic marketing, and the GDPR also imposes additional conditions in order to satisfy such consent, such as a prohibition on pre-checked consents and on bundled consents thereby requiring users to affirmatively consent for a given purpose through separate tick boxes.
In the European Union and United Kingdom, informed consent is required for the placement of certain cookies on a user’s device and for direct electronic marketing, and the GDPR also imposes additional conditions in order to satisfy such consent, such as a prohibition on pre-checked consents and on bundled consents thereby requiring users to affirmatively consent for a given purpose through separate tick boxes.
The lease for these facilities expires in 2026. We also lease offices in New York City and Orlando in the United States. We believe that our facilities are adequate to meet our needs for the immediate future, and that, should it be needed, suitable additional space will be available to accommodate any expansion of our operations. Item 4A.
The lease for these facilities expires in December 2026. We also lease offices in New York City and Orlando in the United States. We believe that our facilities are adequate to meet our needs for the immediate future, and that, should it be needed, suitable additional space will be available to accommodate any expansion of our operations. 54 Item 4A.
To help sellers increase visibility and grow their business on Fiverr, we launched an advertising tool, Promoted Gigs, that allows sellers to bid and win prime locations on our website through an auction mechanism. Promoted Gigs are cost-per-click, so sellers are charged only when their ads are viewed and clicked by the buyer.
To help sellers increase visibility and grow their business on Fiverr, we built an advertising tool, Promoted Gigs, that allows sellers to bid and win prime locations on our website through an auction mechanism. Promoted Gigs are cost-per-click, so sellers are charged only when their ads are viewed and clicked by the buyer.
Leveraging our end-to-end transaction platform and the depth of transaction data, we launched Fiverr Inspire, an innovative way to browse and shop for digital services based on sellers and their portfolio. Our search, browse and recommendation algorithms are designed to match each buyer’s search with the most relevant Gig and seller results.
Leveraging our end-to-end transaction platform and the depth of transaction data, we launched Fiverr Discover, an innovative way to browse and shop for digital services based on sellers and their portfolio. Our search, browse and recommendation algorithms are designed to match each buyer’s search with the most relevant Gig and seller results.
Buyers are able to describe their requirements and preferences during the pre-order process and the communication channels for process management and coordination remain open over the lifecycle of the Gig. As part of deliverable acceptance, buyers may utilize our “Request Revisions” feature to further refine the deliverable, if desired.
Buyers are able to describe their requirements and preferences during the pre-order process and the communication channels for process management and coordination remain open over the lifecycle of the Gig. As part of deliverable acceptance, buyers may utilize our “Request Revisions” feature to further refine the deliverable, if desired. Support and intervention.
Environmental, Social and Governance (ESG) Practices Fiverr was built with a defined purpose from day one to revolutionize how the world works together. We believe that our success can only be built alongside the success of our stakeholders, including our community, employees and shareholders.
Environmental, Social and Governance (ESG) Practices Fiverr was built with a defined purpose from day one to change how the world works together. We believe that our success can only be built alongside the success of our stakeholders, including our community, employees and shareholders.
In addition, there are significantly increased administrative fines of the greater of €20 million and 4% of global turnover (as well as the right to compensation for financial or non-financial damages claimed by any individuals under Article 82 of the GDPR).
In addition, there are significantly increased administrative fines of the greater of €20 million / £17.5 million and 4% of global turnover (as well as the right to compensation for financial or non-financial damages claimed by any individuals under Article 82 of the GDPR).
Upon purchasing a Gig on Fiverr, a buyer knows the scope, duration and price. Comprehensive and diverse catalog. At the foundation of our core platform is an expansive catalog of Gigs that currently spans over 600 digital service categories.
Upon purchasing a Gig on Fiverr, a buyer knows the scope, duration and price. Comprehensive and diverse catalog. At the foundation of our core platform is an expansive catalog of Gigs that currently spans over 700 digital service categories.
We also provide a robust end to end technology infrastructure and tools to help our sellers manage key functions of their online and offline business on our platform, such as proposals and contracts, invoicing and payments, project management and marketing.
We also provide a robust end to end technology infrastructure and tools to help our sellers manage key functions of their business on our platform, such as proposals and contracts, invoicing and payments, project management and marketing.
As such, our analytics capabilities give sellers increased visibility into their performance and a better understanding of what is important to buyers so that they have the feedback to continuously improve. 38 Advertising.
As such, our analytics capabilities give sellers increased visibility into their performance and a better understanding of what is important to buyers so that they have the feedback to continuously improve. 47 Advertising.
Oversight of the Company’s risks, strategies, policies, programs and practices related to ESG matters is conducted by our Nominating and Governance Committee, and our EVP and General Counsel and EVP of Strategic Finance lead the day-to-day management of ESG matters.
Oversight of the Company’s risks, strategies, policies, programs and practices related to ESG matters is conducted by our nominating, environmental, social and governance committee, and our EVP and General Counsel and EVP of Strategic Finance lead the day-to-day management of ESG matters.
During 2021, we identified four core pillars that outline some of the specific ways we are making positive change in the world and the key issues that we believe are important to our business and stakeholders. • Creating fair economic and social opportunities: fostering a level playing field and providing economic and business opportunities for talent across the world; • Marketplace integrity and ethics: holding high standards for quality and integrity in our marketplace; • Empowering our people: building a diverse and inclusive workforce and company culture; and • Climate change: reducing the carbon footprint by enabling remote work and driving responsible resource use.
During 2023, we continued with our four core pillars that outline some of the specific ways we are making positive change in the world and the key issues that we believe are important to our business and stakeholders. • Creating fair economic and social opportunities: fostering a level playing field and providing economic and business opportunities for talent across the world; • Marketplace integrity and ethics: holding high standards for quality and integrity in our marketplace; • Empowering our people: building a diverse and inclusive workforce and company culture; and • Climate change: reducing the carbon footprint by enabling remote work and driving responsible resource use.
In addition, we hold certain personal data of our employees and contractors. We operate in accordance with the terms of our privacy policies, which describe our practices concerning the collection, use, transmission and disclosure of personal data.
In addition, we hold certain personal data of our employees, job applicants and contractors. We operate in accordance with the terms of our privacy policies, which describe our practices concerning the collection, use, transmission and disclosure of personal data.
Our online seller forum, offline community events and “Fiverr Learn,” our e-learning platform, provide additional channels for our sellers to further enhance their skills and build their personal brand and digital storefront with us. Business support infrastructure.
Our online seller forum, offline community events and Fiverr Learn, our e-learning platform, provide additional channels for our sellers to further enhance their skills and build their personal brand and digital storefront with us. Business support infrastructure.
D. Property, Plant and Equipment Our principal facilities are located in Tel Aviv, Israel and consist of approximately 4,380 square meters (approximately 47,146 square feet) of leased office space. These facilities currently accommodate our principal executive offices, research and development, marketing, design, business development, finance, information technology, user support and other administrative activities.
D. Property, Plant and Equipment Our principal facilities are located in Tel Aviv, Israel and consist of approximately 4,500 square meters (approximately 48,438 square feet) of leased office space. These facilities currently accommodate our principal executive offices, research and development, marketing, design, business development, finance, information technology, user support and other administrative activities.
Item 4. Information on the Company. A. History and Development of the Company We were incorporated in Israel under the Israeli Companies Law, 5759-1999 in April 2010, and our principal executive office is located at 8 Eliezer Kaplan St., Tel Aviv 6473409, Israel. Our legal name is Fiverr International Ltd. and our commercial name is FIVERR.
Item 4. I nformation on the Company. A. History and Development of the Company Our legal name is Fiverr International Ltd. and our commercial name is FIVERR. We were incorporated in Israel under the Companies Law in April 2010, and our principal executive office is located at 8 Eliezer Kaplan St., Tel Aviv 6473409, Israel.
We have nine wholly-owned subsidiaries: Stoke Talent Ltd., Incorporated under the laws of the State of Israel, Fiverr Inc., ClearVoice, Inc., Working Not Working, Inc., CreativeLive Inc. and Stoke Talent Inc. each of which incorporated under the laws of the State of Delaware, Sharon Lee Thony Consulting, LLC, incorporated under the laws of the State of New York, Fiverr Germany GmbH, incorporated under the laws of the Federal Republic of Germany and Fiverr Limited, incorporated under the laws of the Republic of Cyprus.
We have seven wholly-owned subsidiaries: Fiverr Inc., ClearVoice, Inc., Working Not Working, Inc., and CreativeLive Inc. each of which incorporated under the laws of the State of Delaware, Sharon Lee Thony Consulting, LLC, incorporated under the laws of the State of New York, Fiverr Germany GmbH, incorporated under the laws of the Federal Republic of Germany and Fiverr Limited, incorporated under the laws of the Republic of Cyprus.
We expect to continue to evolve our ESG strategy in the future as our ESG program matures. 42 Government legislation and regulation Actions of our users In many jurisdictions, including the United States and countries in Europe, laws relating to the liability of providers of online services for activities of their users and other third parties are currently being tested by a number of claims, including actions based on defamation, breach of data protection and privacy rights and other torts, unfair competition, copyright and trademark infringement and other theories based on the nature and content of the materials searched, the ads posted, or the content uploaded by users.
Government legislation and regulation Actions of our users In many jurisdictions, including the United States and countries in Europe, laws relating to the liability of providers of online services for activities of their users and other third parties are currently being tested by a number of claims, including actions based on defamation, breach of data protection and privacy rights and other torts, unfair competition, copyright and trademark infringement and other theories based on the nature and content of the materials searched, the ads posted, or the content uploaded by users.
The DSA and the DMA focus on creating a safer digital space, protecting fundamental rights of all users of digital services, and establishing a level playing field for businesses and consumers with regards to online platforms.
For the DSA, most provisions became applicable on February 17, 2024. The DSA and the DMA focus on creating a safer digital space, protecting fundamental rights of all users of digital services, and establishing a level playing field for businesses and consumers with regards to online platforms.
Sellers are also provided with real-time feedback on their performance in timeliness of delivery, responsiveness and completion rates via our seller dashboard. In addition, Seller Plus subscribers now get access to advanced analytics features such as traffic and keyword analytics.
Gig specific analytics allow sellers to better understand their past performance in order to improve their future performance. Sellers are also provided with real-time feedback on their performance in timeliness of delivery, responsiveness and completion rates via our seller dashboard. In addition, Seller Plus subscribers now get access to advanced analytics features such as traffic and keyword analytics.
We are defined as a “Data Controller” with respect to the personal data of our users that we collect and are therefore subject to a number of key legal obligations under the GDPR.
Europe We are subject to the GDPR. We are a “Controller” with respect to the personal data of our users that we collect and are therefore subject to a number of key legal obligations under the GDPR.
In the years ended December 31, 2022, 2021 and 2020, our revenue was $337.4 million, $297.7 million and $189.5 million, respectively, a 13% and 57% increase, respectively, and we incurred net losses of $71.5 million, $65.0 million and $14.8 million, respectively. Geographically, the substantial majority of our revenue is generated from buyers in English speaking countries.
In the years ended December 31, 2023, 2022 and 2021, our revenue was $361.4 million, $337.4 million and $297.7 million, respectively, a 7% and 13% increase, respectively, and we incurred net income (loss) of $3.7 million, ($71.5) million and ($65.0) million, respectively. Geographically, the substantial majority of our revenue is generated from buyers in English speaking countries.
Our platform is powered by our machine learning technology and expansive data assets. Using our extensive data assets and our AI tools, we are able to continuously optimize our product search capabilities, personalize our user experience, refine our matching algorithm and monitor our service quality.
Using our extensive data assets and our AI tools, we are able to continuously optimize our product search capabilities, personalize our user experience, refine our matching algorithm and monitor our service quality.
That is complemented by highly effective performance marketing and brand investments across a variety of channels. We aim to acquire new buyers through the most efficient channels with the highest return on investment. Once they join, our goal is to demonstrate the value of our platform to our users in order to continuously increase each user’s lifetime value.
We aim to acquire new buyers through the most efficient channels with the highest return on investment. Once they join, our goal is to demonstrate the value of our platform to our users in order to continuously increase each user’s lifetime value.
We compete with a number of online and offline platforms and services to attract and retain users, although we believe that none of our competitors operate a similar business model with the breadth of our catalog, the range of services and global reach as our platform.
We compete with a number of online and offline platforms and services to attract and retain users although we believe that none of our competitors operate an e-commerce business model at a similar scale as our platform.
Getting paid on time after project completion has historically been an uncertain and time-consuming process for sellers. We eliminate this friction by working with third-party agents to collect the funds from the buyer at the time of purchase and timely release them to the seller upon project completion. Credentialed storefront.
We eliminate this friction by working with third-party agents to collect the funds from the buyer at the time of purchase and timely release them to the seller upon project completion. Credentialed storefront.
Our resolution center helps buyers to resolve disputes online, and our 24/7 ticketing system is available should a buyer encounter a more complex problem.
Our user support function is available throughout the buyer journey to provide clarification, help, education and support. Our resolution center helps buyers to resolve disputes online, and our 24/7 ticketing system is available should a buyer encounter a more complex problem.
Our proprietary technology allows for turning non-SKU digital services into structured Gigs, enabling continuous and nimble category expansion. We are also developing depth for each category by developing attributes and experiences specific to each service category.
At the core of our platform lies the challenge of productizing digital services and making them available on our e-commerce platform. Our proprietary technology allows for turning non-SKU digital services into structured Gigs, enabling continuous and nimble category expansion. We are also developing depth for each category by developing attributes and experiences specific to each service category.
Prior to providing such consent, users must receive clear and comprehensive information, both in accordance with the more stringent requirements under the GDPR.
These requirements predominantly regulate the use by companies of cookies and comparable technologies. Prior to providing such consent, users must receive clear and comprehensive information, both in accordance with the more stringent requirements under the GDPR.
We continuously invest in our technology and believe that our focus on innovation gives us a competitive advantage. The core pillars that support the foundation of our platform are: Digital services as products. At the core of our platform lies the challenge of productizing digital services and making them available on our e-commerce platform.
Technology is at the core of everything we do and is a key business asset and enabler. We continuously invest in our technology and believe that our focus on innovation gives us a competitive advantage. The core pillars that support the foundation of our platform are: Digital services as products.
As further guidance is issued and interpretation of both the DSA and the DMA, it is difficult to assess the impact of the DSA and DMA on our business or operations, but, to the extent applicable, it may require us to modify our practices and policies and we could incur substantial costs as a result.
As further guidance on the DSA is issued, it may require us to further modify our practices and policies and we could incur substantial costs as a result.
On that basis, we set out to design a digital marketplace that is built with a comprehensive SKU-like services catalog and an efficient search, find and order process that mirrors a typical e-commerce transaction. We believe our model reduces friction and uncertainties for both buyers and sellers.
On that basis, we set out to design a digital services marketplace that is built with a comprehensive SKU-like services catalog and an efficient search, find and order process that mirrors a typical e-commerce transaction. We call this the Service-as-a-Product, or the SaaP model.
In recent years, U.S. and European lawmakers and regulators have expressed concern over the use of third-party cookies and similar technologies for online behavioral advertising, and laws in this area are also under reform. In the European Union, current national laws that implement the ePrivacy Directive will soon be replaced by an EU regulation known as the ePrivacy Regulation.
In recent years, U.S. and European lawmakers and regulators have expressed concern over the use of third-party cookies and similar technologies for online behavioral advertising, and laws in this area are also under reform.
“ Operating and Financial Review and Prospects .” B. Business Overview Our mission is to revolutionize how the world works together. We started with the simple idea that people should be able to buy and sell digital services in the same fashion as physical goods on an e-commerce platform.
We started with the simple idea that people should be able to buy and sell digital services in the same fashion as physical goods on an e-commerce platform.
Each Gig includes the details of the service provided, the price, delivery timeframe and reviews from previous buyers of that Gig, allowing buyers to make informed decisions based on their needs, budgets and tastes.
Our SaaP model provides buyers access to an extensive catalog of Gigs that they can compare and filter across parameters including Gig details, reviews and price. Each Gig includes the details of the service provided, the price, delivery timeframe and reviews from previous buyers of that Gig, allowing buyers to make informed decisions based on their needs, budgets and tastes.
Sellers decide a daily budget and the maximum bid per click, and we also provide automatic bidding tools to help sellers optimize their bid price and maximize their exposure with minimum efforts on their part. Learning and education.
Sellers decide a daily budget and the maximum bid per click, and we also provide automatic bidding tools to help sellers optimize their bid price and maximize their exposure with minimum efforts on their part. 48 Seller Plus . Seller Plus is a subscription-based loyalty program which provides sellers with additional tools to help accelerate their business on our marketplace.
Using Fiverr, buyers can easily connect with these freelancers and get a broad range of digitally delivered services executed quickly and efficiently. Transparency and certainty of price, scope of work and quality. Our SaaP model enables transparency and certainty when it comes to cost, duration and scope.
We provide instant access to hundreds of thousands of freelancers with a broad set of skills. Using Fiverr, buyers can easily connect with these freelancers and get a broad range of digitally delivered services executed quickly and efficiently. Transparency and certainty of price, scope of work and quality.
Sellers can manage their business from any browser or from our mobile apps. Seller onboarding. We have developed an automated onboarding process designed to educate and guide new sellers through the creation of their seller profile (their storefront), Gigs (the services they sell) and portfolio (a collection of their work samples).
We have developed an automated onboarding process designed to educate and guide new sellers through the creation of their seller profile (their storefront), Gigs (the services they sell) and portfolio (a collection of their work samples). Once a seller is onboarded, each Gig they offer becomes a part of the Fiverr catalog. Business management.
We provide what we believe to be the best value for money for our buyers by alleviating frictions and inefficiencies in the value chain. Our expansive digital services catalog enables us to offer sophisticated browsing and filtering functions. We believe that this results in a lower time-to-hire for buyers compared to traditional offline hiring platforms, saving buyers valuable time.
Our expansive digital services catalog enables us to offer sophisticated browsing and filtering functions. We believe that this results in a lower time-to-hire for buyers compared to traditional offline hiring platforms, saving buyers valuable time. Access to an expansive catalog of digital services. Our catalog of digital services has over 700 categories and continues to grow and evolve.
Our buyer-driven rating system provides a transparent quality rating mechanism for every Gig, helping buyers make informed purchasing decisions. This system ensures that our buyers have added peace of mind with every purchase. Trusted brand for customer service. We are relentlessly focused on providing quality customer service as we seek to drive repeat purchase behavior.
Our SaaP model enables transparency and certainty when it comes to cost, duration and scope. Our buyer-driven rating system provides a transparent quality rating mechanism for every Gig, helping buyers make informed purchasing decisions. This system ensures that our buyers have added peace of mind with every purchase. Trusted brand for customer service.
We have also embedded extensive monitoring and alerting infrastructure into our platform to maintain reliability and platform performance. Security . Protecting data is one of the key pillars of our business.
We have also embedded extensive monitoring and alerting infrastructure into our platform to maintain reliability and platform performance. Security . Information security is one of the key pillars of our business. We protect our users’ data and our company through a combination of security procedures and technology tools, and we are committed to ensuring that our platform remains secure.
We believe that this approach is fundamentally different from either traditional offline or online long-term temporary employment solutions. Unlike such traditional solutions, each Gig on Fiverr is listed with a clearly defined scope and timeline and is sold for a fixed price rather than on an hourly basis. Technology and data assets. We are a technology company.
Unlike such traditional solutions, each Gig on Fiverr is listed with a clearly defined scope and timeline and is sold for a fixed price rather than on an hourly basis. Technology and data assets. We are a technology company. Our platform is powered by our machine learning technology and expansive data assets.
Instead, they list the service on our core platform with a well-defined scope, duration and price, and our proprietary technology directly matches them with buyers who are looking for the service they provide. As a result, sellers can list their Gigs on our core platform and focus on the work they love doing while maximizing their earning potential.
Sellers on our core platform do not need to bid to win a project. Instead, they list the service on our core platform with a well-defined scope, duration and price, and our proprietary technology directly matches them with buyers who are looking for the service they provide.
We continue to develop both the breadth and depth of our catalog in order to provide our buyers with access to the services they need. Access to a diverse pool of freelancers. We provide instant access to hundreds of thousands of freelancers with a broad set of skills.
Prices can range from $5 to thousands of dollars, depending on the scope and perceived quality of each individual Gig. We continue to develop both the breadth and depth of our catalog in order to provide our buyers with access to the services they need. Access to a diverse pool of freelancers.
They range from individuals who use our core platform to earn their full-time living to those who augment their income. Our value proposition to sellers Maximize project pipeline. Sellers on our core platform do not need to bid to win a project.
Our sellers Our sellers are a diverse group of freelancers who we believe value the flexibility and financial opportunity our core platform provides. They range from individuals who use our core platform to earn their full-time living to those who augment their income. Our value proposition to sellers Maximize project pipeline.
On our proprietary learning platform, we provide sellers access to an education center with comprehensive information on how to grow as a freelancer as well as become a more effective seller on Fiverr. We offer tutorials and materials on the use of Fiverr infrastructure tools, allowing sellers to get the most out of their experience on our core platform.
We offer tutorials and materials on the use of Fiverr infrastructure tools, allowing sellers to get the most out of their experience on our core platform. This is supplemented by our Seller Help Center, which allows sellers to open tickets with customer support as well as access a comprehensive set of FAQs and how-to videos.
Once a seller is onboarded, each Gig they offer becomes a part of the Fiverr catalog. Business management. To allow sellers to focus on doing what they love, we provide a comprehensive suite of tools that help them manage administrative aspects of their business, such as workflow prioritization, invoicing and payment processing.
To allow sellers to focus on doing what they love, we provide a comprehensive suite of tools that help them manage administrative aspects of their business, such as workflow prioritization, invoicing and payment processing. Additional communication tools further enhance a seller’s ability to communicate with buyers as well as to collaborate on Gigs with other sellers.
We have included our website address in this Annual Report solely for informational purposes. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers, such as we, that file electronically, with the SEC at www.sec.gov .
“ Operating and Financial Review and Prospects. ” The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers, such as we, that file electronically, with the SEC at www.sec.gov. Our website address is www.fiverr.com, and our telephone number is +972-72-2280910.
Our dispute resolution technology enables us to flag issues in a timely manner and to guide users to a solution, whether that solution is our self-service support portal or intervention by our customer support team. Our sellers Our sellers are a diverse group of freelancers who we believe value the flexibility and financial opportunity our core platform provides.
We are relentlessly focused on providing quality customer service as we seek to drive repeat purchase behavior. Our dispute resolution technology enables us to flag issues in a timely manner and to guide users to a solution, whether that solution is our self-service support portal or intervention by our customer support team.
Flexibility and control. People increasingly want to choose where they work, when they work and what they do for work. Our core platform embraces habitual changes in the workforce and provides freelancers with the ability to find work and offer their services from anywhere in the world at any point in time. Frictionless payment processing.
Our core platform embraces habitual changes in the workforce and provides freelancers with the ability to find work and offer their services from anywhere in the world at any point in time. 40 Frictionless payment processing. Getting paid on time after project completion has historically been an uncertain and time-consuming process for sellers.
Our agent for service of process in the United States is C T Corporation System and its address is 28 Liberty Street, New York, New York 10005. For a description of our principal capital expenditures and divestitures for the three years ended December 31, 2022 and for those currently in progress, see Item 5.
For a description of our principal capital expenditures and divestitures for the three years ended December 31, 2023 and for those currently in progress, see Item 5.
Our suite of tools provides sellers with detailed analytics on their operations, facilitating greater transparency and insight into business and performance indicators, including Gig revenue, order pipeline and ratings. Gig specific analytics allow sellers to better understand their past performance in order to improve their future performance.
Our seller dashboard provides a unified work management interface that consolidates key information from our seller tools and performance metrics, allowing sellers to more effectively manage their business. 46 Analytics. Our suite of tools provides sellers with detailed analytics on their operations, facilitating greater transparency and insight into business and performance indicators, including Gig revenue, order pipeline and ratings.
For those sellers new to the business, we help them gain access to buyers so that they can quickly start developing their reputation. For the more experienced and professional sellers, we enroll them into the Fiverr Pro program to allow them to build a premium business and gain access to buyers who may be prioritizing a higher quality work product.
For those sellers new to the business, we help them gain access to buyers so that they can quickly start developing their reputation.
We also invest in building an infrastructure for international expansion that allows us to roll out six non English websites and provide multilingual support to our users. We have also launched Fiverr Business, a dedicated environment for teams and business buyers to transact and collaborate on Fiverr in a more seamless fashion. Expansion of core platform .
We also invest in building an infrastructure for international expansion that allows us to roll out six non English websites and provide multilingual support to our users. Fiverr Business Solutions. We recently launched Fiverr Business Solutions to allow larger companies access and work with freelancers across multiple use cases and engagement scenarios.
Our technology To help our buyers and sellers transact on our platform, we have built a modular and scalable technology platform that supports our business while protecting operational integrity and performance. Technology is at the core of everything we do and is a key business asset and enabler.
We also provide access to a library of high quality educational content through Fiverr Learn and CreativeLive to help freelancers improve their skills and grow professionally. 49 Our technology To help our buyers and sellers transact on our platform, we have built a modular and scalable technology platform that supports our business while protecting operational integrity and performance.
We constantly monitor activity on our platform to ensure compliance with our terms of service, as we seek to create a consistent and reliable user experience for our buyers . 36 Seller experience We offer a set of tools for sellers to build their Gigs, develop their brand, establish a reputation and create their work portfolio.
We constantly monitor activity on our platform to ensure compliance with our terms of service, as we seek to create a consistent and reliable user experience for our buyers. 43 Fiverr Pro . Fiverr Pro is a premium section of the marketplace where buyers can enjoy collaboration and administrative tools tailored for larger organizations.
If similar laws are passed in other states or at the federal level, such laws may have potentially conflicting requirements that would make compliance challenging and costly. Europe European legislators adopted the GDPR, repealing the 1995 European Data Protection Directive (Directive 95/46/EC).
In addition, over a dozen other states have passed or are considering similar legislation, which has created and will continue to create additional compliance obligations and privacy rights. If similar laws continue to be passed in other states or at the federal level, such laws may have potentially conflicting requirements that would make compliance challenging and costly.
We are registered with the Israeli Registrar of Companies. Our registration number is 51-444087-4. Our website address is www.fiverr.com, and our telephone number is +972-72-2280910. Information contained on, or that can be accessed through, our website does not constitute a part of this Annual Report and is not incorporated by reference herein.
Information contained on, or that can be accessed through our website does not constitute a part of this Annual Report and is not incorporated by reference herein. We have included our website address in this Annual Report solely for informational purposes. B. Business Overview Our mission is to change how the world works together.
We engage and grow our buyer base organically and through thoughtful performance and brand marketing, all without a direct sales force. In the year ended December 31, 2022, we served 4.3 million active buyers from over 160 countries across the globe, up from 4.2 million active buyers in 2021. Our value proposition to buyers Value for money.
In the year ended December 31, 2023, we served 4.1 million active buyers from over 160 countries across the globe. Our value proposition to buyers Value for money. We provide what we believe to be the best value for money for our buyers by alleviating frictions and inefficiencies in the value chain.
Go-to-market We have adopted a bottom up approach in our go-to-market strategy. Our goal is to target individuals and teams who work in various business functions at companies of different sizes across different industries. Our offerings resonate with people who just want to get things done within their budget and deadline constraints.
Go-to-market We primarily grow our buyer base through performance marketing and brand investments using a bottom up approach. Our goal is to target individuals and teams who work in various business functions at companies of different sizes across different industries. Our unique SaaP model eliminates uncertainties and frictions and allows more autonomous purchasing decisions.
We have expanded our core platform to offer an ecosystem of value-added products that empowers our sellers to build a successful freelancing career and enables businesses of all sizes to implement an effective and efficient strategy to utilize freelancing workforce. For freelancers, Promoted Gigs and Seller Plus provide advertising capabilities and advanced tools to help them succeed on our marketplace.
We offer an ecosystem of value-added products that empowers our sellers to grow their business on Fiverr and build a successful freelancing career. For example, Promoted Gigs is an advertising tool that allows sellers to promote their services on our platform.
We believe that our catalog coverage is broader than many of our competitors, and we are focused on continuously growing this catalog. Today, buyers can purchase Gigs such as logo design, video creation or website development with prices ranging from $5 to thousands of dollars, all easily and with just a few clicks.
Today, buyers can purchase digital services ranging from simple services such as logo design and blog post writing, to complex services such as video creation, website development and social media marketing, all easily and with just a few clicks. We believe that this approach is fundamentally different from either traditional offline or online long-term temporary employment solutions.
Our buyers include businesses of all sizes, while our sellers are a diverse group of freelancers and small businesses from over 160 countries who tap into our core platform to earn their full-time living or augment their income. As a marketplace, we succeed when our buyers and sellers succeed.
Fiverr provides our customers with differentiated value propositions so that they can fulfill their digital service needs with unmatched speed and convenience. As a marketplace, we succeed when our buyers and sellers succeed. Our buyers include businesses of all sizes, and our sellers are a diverse group of freelancers and agencies from over 160 countries.
Pursuant to the requirements of the ePrivacy Directive, companies must, among other things, obtain consent to store information or access information already stored, on a user’s terminal equipment (e.g., computer or mobile device). These requirements predominantly regulate the use by companies of cookies and comparable technologies.
Compliance with these laws is constantly evolving, resource intensive and time consuming, and companies that do not comply with these laws may face significant liabilities. 53 In the EU and UK, under national laws derived from the European ePrivacy Directive (Directive 2002/58/EC as amended by Directive 2009/136/EC), companies must, among other things, obtain consent to store information or access information already stored, on a user’s terminal equipment (e.g., computer or mobile device).
For example, California voters also passed the California Privacy Rights Act, which entered into substantial effect on January 1, 2023, and significantly modifies the California Consumer Privacy Act, including providing new data privacy rights for consumers and new operational requirements for companies.
For example, the California Consumer Privacy Act, or the CCPA, as amended by the California Privacy Rights Act, or the CPRA, provides new data privacy rights for consumers and new operational requirements for companies.
Using either our search or navigation tools, buyers can easily find and purchase productized services, such as logo design, video creation and editing, website development and blog writing, with prices ranging from $5 to thousands of dollars. We call this the Service-as-a-Product, or the SaaP model. Our approach fundamentally transforms the traditional freelancer staffing model into an e-commerce-like experience.
Using either our search or navigation tools, buyers can easily compare and find talent and their service listings, and in turn purchase and fulfill their digital needs, ranging from simple services such as logo design and blog post writing, to complex services such as video creation, website development and social media marketing.
On November 1, 2022, the Digital Markets Act, or the DMA, entered into force and on November 16, 2022, the Digital Services Act, or the DSA, followed. For the DSA, most provisions become applicable on February 17, 2024.
Compliance with these laws is constantly evolving, resource intensive and time consuming, and companies that do not comply with these laws may face significant liabilities. On November 1, 2022, the Digital Markets Act, or the DMA, entered into force and on November 16, 2022, the Digital Services Act, or the DSA, followed.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following tables set forth our results of operations in U.S. dollars and as a percentage of revenue for the periods indicated: Year ended December 31, 2022 2021 (in thousands) Revenue $ 337,366 $ 297,662 Cost of revenue 65,948 51,723 Gross profit 271,418 245,939 Operating expenses: Research and development 92,563 79,298 Sales and marketing 174,599 159,365 General and administrative 51,161 52,616 Impairment of intangible assets 27,629 — Total operating expenses 345,952 291,279 Operating loss (74,534 ) (45,340 ) Financial income (expense), net 3,624 (19,513 ) Loss before income taxes (70,910 ) (64,853 ) Income taxes (577 ) (159 ) Net loss $ (71,487 ) $ (65,012 ) Year ended December 31, 2022 2021 (as a% of revenue) Revenue 100.0 % 100.0 % Cost of revenue 19.5 17.4 Gross profit 80.5 82.6 Operating expenses: Research and development 27.4 26.6 Sales and marketing 51.8 53.5 General and administrative 15.2 17.7 Impairment of intangible assets 8.2 — Total operating expenses 102.5 97.9 Operating loss (22.1 ) (15.2 ) Financial income (expense), net 1.1 (6.6 ) Loss before income taxes (21.0 ) (21.8 ) Income taxes * * Net loss (21.2 )% (21.8 )% * Represents amounts of less than 0.5% 51 Year ended December 31, 2022 compared to year ended December 31, 2021 Revenue Revenue increased by $39.7 million, or 13.3%, to $337.4 million for the year ended December 31, 2022 from $297.7 million for the year ended December 31, 2021.
Biggest changeThe following tables set forth our results of operations in U.S. dollars and as a percentage of revenue for the periods indicated: Year ended December 31, 2023 2022 (in thousands ) Revenue $ 361,375 $ 337,366 Cost of revenue 61,846 65,948 Gross profit 299,529 271,418 Operating expenses: Research and development 90,720 92,563 Sales and marketing 161,208 174,599 General and administrative 62,710 51,161 Impairment of intangible assets - 27,629 Total operating expenses 314,638 345,952 Operating loss (15,109 ) (74,534 ) Financial income, net 20,163 3,624 Income (loss) before income taxes 5,054 (70,910 ) Income taxes (1,373 ) (577 ) Net Income (loss) $ 3,681 $ (71,487 ) Year ended December 31, 2023 2022 (as a% of revenue ) Revenue 100.0 % 100.0 % Cost of revenue 17.1 19.5 Gross profit 82.9 80.5 Operating expenses: Research and development 25.1 27.4 Sales and marketing 44.6 51.8 General and administrative 17.4 15.2 Impairment of intangible assets - 8.2 Total operating expenses 87.1 102.5 Operating loss (4.2 ) (22.1 ) Financial income, net 5.6 1.1 Income (Loss) before income taxes 1.4 (21.0 ) Income taxes (0.4 ) (0.2 ) Net income (loss) 1.0 % (21.2 )% 60 Year ended December 31, 2023 compared to year ended December 31, 2022 Revenue Revenue increased by $24.0 million, or 7.1%, to $361.4 million for the year ended December 31, 2023 from $337.4 million for the year ended December 31, 2022.
As we expand our platform to include additional languages, we expect to deepen our penetration into Western Europe, Asia Pacific and Latin America, and the geographic mix of our revenue could therefore change over time. We do not hire freelancers directly or provide digital services to our buyers as a principal.
As we expand our platform to include additional languages, we expect to deepen our penetration into Western Europe, Asia Pacific and Latin America, and the geographic mix of our revenue could therefore change over time. Generally, we do not hire freelancers directly or provide digital services to our buyers as a principal.
Category expansion continues to be a key strategy for our business. Geographically, the substantial majority of our revenue is generated from buyers in English speaking countries.
Category expansion continues to be a key strategy for our business. 55 Geographically, the substantial majority of our revenue is generated from buyers in English speaking countries.
These spend per buyer growth trends demonstrate our success in moving upmarket by offering a broader set of digital services, increasing engagement and lifetime value of our buyers, and growing the number of higher value Gigs and higher quality sellers on our platform through targeted marketing efforts and a number of product initiatives such as Fiverr Business, Fiverr’s Choice, Subscriptions and Milestones.
These spend per buyer growth trends demonstrate our success in moving upmarket by offering a broader set of digital services, increasing engagement and lifetime value of our buyers, and growing the number of higher value Gigs and higher quality sellers on our platform through targeted marketing efforts and a number of product initiatives such as Fiverr Pro, Fiverr’s Choice, Subscriptions and Milestones.
Certain contractual obligations are reflected on the consolidated balance sheet as of December 31, 2022, while others are considered future commitments. Our contractual obligations primarily consist of purchase obligations, lease payments and convertible notes. For information regarding our other contractual obligations, refer to Note 9, 10 and 12 within our audited consolidated financial statements included elsewhere in this Annual Report.
Certain contractual obligations are reflected on the consolidated balance sheet as of December 31, 2023, while others are considered future commitments. Our contractual obligations primarily consist of purchase obligations, lease payments and convertible notes. For information regarding our other contractual obligations, refer to Note 9, 10 and 12 within our audited consolidated financial statements included elsewhere in this Annual Report.
We recognize revenue from unused user accounts balances once the likelihood of the users exercising their unused accounts balances becomes remote and we are not required to remit such unused account balance to a third party in accordance with applicable unclaimed property laws. The amounts recognized for the years ended December 31, 2022 and 2021 were immaterial.
We recognize revenue from unused user accounts balances once the likelihood of the users exercising their unused accounts balances becomes remote and we are not required to remit such unused account balance to a third party in accordance with applicable unclaimed property laws. The amounts recognized for the years ended December 31, 2023 and 2022 were immaterial.
Our capital expenditures consist primarily of internal-use software costs, computers and peripheral equipment and leasehold improvements. As part of the lease of our Israeli headquarters, the lessor financed an amount of $4.0 million out of the total cost of leasehold improvements in the office space. The remaining loan of $2.9 million was repaid on January 1, 2022.
Our capital expenditures consist primarily of computers and peripheral equipment, leasehold improvement and internal-use software costs. As part of the lease of our Israeli headquarters, the lessor financed an amount of $4.0 million out of the total cost of leasehold improvements in the office space. The remaining loan of $2.9 million was fully repaid on January 1, 2022.
These forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, the risks and uncertainties described in “Risk factors” and “Special note regarding forward-looking statements.” Our actual results may differ materially from those contained in or implied by any forward-looking statements. Overview Our mission is to revolutionize how the world works together.
These forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, the risks and uncertainties described in “Risk factors” and “Special note regarding forward-looking statements.” Our actual results may differ materially from those contained in or implied by any forward-looking statements. Overview Our mission is to change how the world works together.
The majority of our new buyers in both 2022 and 2021 came from organic and direct sources, meaning buyers who reach our platform via non-paid search results, referrals by existing users, word-of-mouth, direct visits to our website by typing our URL into their browser, or our mobile app.
The majority of our new buyers in both 2023 and 2022 came from organic and direct sources, meaning buyers who reach our platform via non-paid search results, referrals by existing users, word-of-mouth, direct visits to our website by typing our URL into their browser, or our mobile app.
Certain fixed costs are excluded from performance marketing investments and related tROl calculations because performance marketing investments represent our direct variable costs related to buyer acquisition and its corresponding revenue generation. tROl measures the efficiency of such variable marketing investments and is an indicator actively used by management to make day-to-day operational decisions. 48 Growth in spend per buyer We view the acquisition of a new buyer as a starting point for building a long-term relationship between the buyer and our marketplace.
Certain fixed costs are excluded from performance marketing investments and related tROI calculations because performance marketing investments represent our direct variable costs related to buyer acquisition and its corresponding revenue generation. tROI measures the efficiency of such variable marketing investments and is an indicator actively used by management to make day-to-day operational decisions. 57 Growth in spend per buyer We view the acquisition of a new buyer as a starting point for building a long-term relationship between the buyer and our marketplace.
We aim to achieve quarterly tROI of one year or less. Historically, over the eight quarters ending December 31, 2022, we have been able to consistently achieve tROI of less than six months. The second measure for our paid marketing efficiency is the cumulative revenue to performance marketing investment ratio.
We aim to achieve quarterly tROI of one year or less. Historically, over the past eight quarters ending December 31, 2023, we have been able to consistently achieve tROI of less than six months. The second measure for our paid marketing efficiency is the cumulative revenue to performance marketing investment ratio.
Operating Results For a discussion of our results of operations for the year ended December 31, 2020, including a year-to-year comparison between 2021 and 2020, and a discussion of our liquidity and capital resources for the year ended December 31, 2020, refer to Item 5.
Operating Results For a discussion of our results of operations for the year ended December 31, 2021, including a year-to-year comparison between 2022 and 2021, and a discussion of our liquidity and capital resources for the year ended December 31, 2021, refer to Item 5.
We expect cost of revenue to increase in absolute dollars in future periods due to higher payment processing companies’ fees, server hosting fees and employee-related costs in order to support additional transaction volume on our platform. The level and timing of all of these items could fluctuate and affect our cost of revenue in the future.
We expect cost of revenue to increase in absolute dollars in future periods due to higher payment processing companies’ fees, server hosting fees and employee-related costs that are required to support additional transaction volume on our platform. The level and timing of all of these items could fluctuate and affect our cost of revenue in the future.
“Operating and Financial Review and Prospects” in our Annual Report on Form 20-F for the year ended December 31, 2021.
“Operating and Financial Review and Prospects” in our Annual Report on Form 20-F for the year ended December 31, 2022.
Spend per buyer 2019-2022 Key financial and operating metrics We monitor the following key financial and operating metrics to evaluate the growth of our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions. • “ Active buyers ” means buyers who have ordered a Gig or other services on Fiverr within the last 12-month period, irrespective of cancellations.
Key financial and operating metrics We monitor the following key financial and operating metrics to evaluate the growth of our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions. • “ Active buyers ” means buyers who have ordered a Gig or other services on Fiverr within the last 12-month period, irrespective of cancellations.
During the second quarter of 2022 due to an adverse change in macro-economic conditions we recorded an impairment of intangible assets in the amount of $27.6 million mainly in connection with the asset group related to Stoke acquisition, asset group reated to CreativeLive acquisition and internal use software capitalization.
During the second quarter of 2022 due to an adverse change in macroeconomic conditions we recorded an impairment of intangible assets in the amount of $27.6 million mainly in connection with the asset group related to Stoke acquisition, asset group related to CreativeLive acquisition and internal use software capitalization.
Our platform includes over 600 categories across ten verticals, including Graphics & Design, Digital Marketing, Writing & Translation, Video & Animation, Music & Audio, Programming & Tech, Business, Data, Lifestyle, and Photography. For the years ended December 31, 2022, 2021 and 2020, no single category accounted for more than 15% of our core marketplace revenue.
Our platform includes over 700 categories across ten verticals, including Graphics & Design, Digital Marketing, Writing & Translation, Video & Animation, Music & Audio, Programming & Tech, Business, Data, Lifestyle, and Photography. For the years ended December 31, 2023, 2022 and 2021, no single category accounted for more than 15% of our core platform revenue.
Our research and development activities are primarily located in Israel, with additional employees and contractors engaged in research and development activities for us in the US and Ukraine. Research and development expenses are primarily comprised of costs of our research and development personnel and other development-related expenses.
Research and Development, Patents and Licenses, Etc. Our research and development activities are primarily located in Israel, with additional employees and contractors engaged in research and development activities for us in the US and Ukraine. Research and development expenses are primarily comprised of costs of our research and development personnel and other development-related expenses.
Our development strategy is focused on identifying updates and enhanced features for our existing offerings, developing new offerings that are tailored to our registered users’ needs and often arise out of their suggestions, and improving the performance of our platform. In 2022, research and development costs accounted for approximately 27.4% of our total revenue.
Our development strategy is focused on identifying updates and enhanced features for our existing offerings, developing new offerings that are tailored to our registered users’ needs and often arise out of their suggestions, and improving the performance of our platform. In 2023, research and development costs accounted for approximately 25.1% of our total revenue.
See also “Item 3.D. – Risk Factors – Adverse economic conditions can materially adversely affect the Company’s business, results of operations and financial condition, due to impacts on consumer and business spending and demand for our services.” E.
See also Item 3.D. “Risk Factors” – Adverse economic conditions can materially adversely affect the Company’s business, results of operations and financial condition, due to impacts on consumer and business spending and demand for our services.” E.
Cost of revenue is mainly comprised of expenses related to payment processing companies’ fees, server hosting fees, costs of customer support personnel, amortization of capitalized internal-use software and developed technology and courses.
Cost of revenue primarily consists of expenses related to payment processing companies’ fees, server hosting fees, costs of customer support personnel, amortization of capitalized internal-use software and developed technology and courses.
The following table sets forth our key performance indicators as of December 31, 2022 and 2021: As of December 31, 2022 2021 Active buyers (in thousands) 4,275 4,217 Spend per buyer $ 262 $ 242 49 Components of our results of operations Revenue. Our revenue is primarily comprised of transaction fees and service fees.
The following table sets forth our key performance indicators as of December 31, 2023 and 2022: As of December 31, 2023 2022 Active buyers (in thousands) 4,077 4,275 Spend per buyer $ 278 $ 262 58 Components of our results of operations Revenue. Our revenue is primarily comprised of transaction fees and service fees.
The critical accounting estimates that we believe have the most significant impact on our consolidated financial statements are discussed below.
The critical accounting estimates that we believe have the most significant impact on our consolidated financial statements are discussed below. Revenue recognition Our customers are the users on our platform.
Research and development expenses are primarily comprised of costs of our research and development personnel and other development-related expenses. Research and development costs are expensed as incurred, except to the extent that such costs are associated with internal-use software that qualifies for capitalization.
Research and development expenses are primarily comprised of costs of our research and development personnel, related overhead costs, including share-based compensation, development related activities expenses including new initiatives and other. Research and development costs are expensed as incurred, except to the extent that such costs are associated with internal-use software that qualifies for capitalization.
To track our growth and the underlying dynamics of our business, we closely monitor and analyze the behavior of our annual buyer cohorts. We define an annual buyer cohort based on the year when the buyer’s first purchase on our platform was made. Historically, we have observed consistency across our annual buyer cohorts.
Consistent cohort behavior Our business has historically benefited from strong cohort revenue consistency. To track our growth and the underlying dynamics of our business, we closely monitor and analyze the behavior of our annual buyer cohorts. We define an annual buyer cohort based on the year when the buyer’s first purchase on our platform was made.
Our take rate is sustainable and has grown moderately over time as we provide more value to buyers and sellers through products and offerings such as Promoted Gigs, Seller Plus, ClearVoice, CreativeLive, Fiverr Learn, Fiverr Workspace, WorkingNotWorking and Stoke Talent. 45 Our revenue is diversified and generated from a broad mix of digital services.
Our take rate is sustainable and has grown moderately over time as we provide more value to buyers and sellers through products and offerings such as Promoted Gigs, Seller Plus, and other value-added services. Our revenue is diversified and generated from a broad mix of digital services.
In addition, certain information relied upon by us in preparing such estimates includes internally generated financial and operating information, external market information, when available, and when necessary, information obtained from consultations with third-parties. Actual results may differ from these estimates. See Item 3.D. “Risk Factors” for a discussion of the possible risks that may affect these estimates.
In addition, certain information relied upon by us in preparing such estimates includes internally generated financial and operating information, external market information, when available, and when necessary, information obtained from consultations with third-parties. Actual results may differ from these estimates. See Item 3.D.
We believe that our cash generated from operating activities, along with existing cash, cash equivalents, marketable securities and bank deposits will be sufficient to fund our working capital and capital expenditures for at least the next 12 months. We also expect our sources of liquidity will be sufficient to fund our long-term contractual obligations and capital needs.
We believe that our cash generated from operating activities, along with existing cash, cash equivalents, marketable securities and bank deposits will be sufficient to fund our working capital and capital expenditures for at least the next 12 months.
On or after November 5, 2023 and from time to time prior to the 42nd scheduled trading day immediately preceding the maturity date, we may redeem, for cash, all or part of the Convertible Notes, at our option, if the last reported sale price of our ordinary shares has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of the redemption at a redemption price equal to 100% of the principal amount of the Convertible Notes to be redeemed, plus accrued and unpaid special interest, if any, to, but excluding, the redemption date.
Upon conversion, the Company will pay or deliver, as the case may be, cash, ordinary shares or a combination of cash and ordinary shares, at the Company’s election. 63 We may redeem, for cash, all or part of the Convertible Notes, at our option, if the last reported sale price of our ordinary shares has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which we provide notice of the redemption at a redemption price equal to 100% of the principal amount of the Convertible Notes to be redeemed, plus accrued and unpaid special interest, if any, to, but excluding, the redemption date.
We intend to continue to invest in our sales and marketing capabilities in the future to continue to increase our brand awareness and grow our business.
We intend to continue to invest in our sales and marketing capabilities in the future to drive revenue growth and to continue to increase our brand awareness.
As of December 31, 2022, we had net operating loss carryforwards for U.S. tax purposes in the amount of approximately $75,695 million, which is expected to be subject to certain limitations under Internal Revenue Code, or IRC, Section 382 following changes in control that occurred upon acquisition of both Clear Voice, Working Not Working and CreativeLive. 50 A.
“Taxation . ” As of December 31, 2023, we had net operating loss carryforwards for U.S. tax purposes in the amount of approximately $34.5 million, which are expected to be subject to certain limitations under Internal Revenue Code, or IRC, Section 382 following changes in control that occurred upon acquisition of both ClearVoice, Working Not Working and CreativeLive. 59 A.
In the year ended December 31, 2022, we had 4.3 million active buyers on our platform. We were founded in 2010 by entrepreneurs who have extensive experience working with freelancers and who have witnessed firsthand how challenging the process can be.
In the year ended December 31, 2023, we had 4.1 million active buyers on our platform. We were founded in 2010 by entrepreneurs who have extensive experience working with freelancers and who have witnessed firsthand how challenging the process can be. Our platform has simplified and streamlined this process for both buyers and sellers.
We believe that the accounting estimates discussed below are critical to our financial results and to the understanding of our past and future performance, as these policies relate to the more significant areas involving management’s estimates and assumptions.
“Risk Factors” for a discussion of the possible risks that may affect these estimates. 64 We believe that the accounting estimates discussed below are critical to our financial results and to the understanding of our past and future performance, as these policies relate to the more significant areas involving management’s estimates and assumptions.
For the years ended December 31, 2022 and 2021, we derived approximately 74.4% and 72.9% of our revenue from transaction fees, respectively, and approximately 25.6% and 27.1% of our revenue from service fees, respectively.
For the years ended December 31, 2023 and 2022, we derived approximately 74.8% and 74.4% of our revenue from transaction fees, respectively, and approximately 25.2% and 25.6% of our revenue from service fees, respectively.
For example, as of December 31, 2022, revenue from the Q4’22 cohort had already amounted to 0.9x of our performance marketing investments during that quarter and the cumulative revenue from the Q4’19 cohort has reached 4.2x of our performance marketing investments during that quarter.
For example, as of December 31, 2023, revenue from the Q4’23 cohort had already amounted to 0.9x of our performance marketing investments during that quarter and the cumulative revenue from the Q4’20 cohort has reached 3.6x of our performance marketing investments during that quarter.
In determining the estimated fair value of the the asset group, we utilized a discounted cash flow model. The key assumptions within the model related to forecasting of future revenue, appropriate discount rate and appropriate terminal value based on the nature of the asset group.
In determining the estimated fair value of the asset group, we utilized a discounted cash flow model. The key assumptions within the model related to forecasting of future revenue, appropriate discount rate and appropriate terminal value based on the nature of the asset group. No impairment of intangible assets was recorded for the year ended December 31, 2023. 66
Bank National Association, as trustee. The Convertible Notes are convertible based upon an initial conversion rate of 4.6823 of our ordinary shares, per $1,000 principal amount of Convertible Notes (equivalent to a conversion price of approximately $213.57 per ordinary share).
The Convertible Notes were issued pursuant to an indenture, dated October 13, 2020, or the Indenture, between us and U.S. Bank National Association, as trustee. The Convertible Notes are convertible based upon an initial conversion rate of 4.6823 of our ordinary shares, per $1,000 principal amount of Convertible Notes (equivalent to a conversion price of approximately $213.57 per ordinary share).
Our platform has simplified and streamlined this process for both buyers and sellers and, as a result, we have experienced significant growth and reached a meaningful scale. Our GMV for the years ended December 31, 2022, 2021 and 2020 was $1,118.3 million, $1,018.7 million and $699.3 million, respectively.
As a result, we have experienced significant growth and reached a meaningful scale. Our GMV for the years ended December 31, 2023, 2022 and 2021 was $1,134.7 million, $1,118.3 million, and $1,018.7 million, respectively.
As of December 31, 2022 and 2021 we had $651.9 million and $641.0 million, respectively, of cash, cash equivalents, bank deposits and marketable securities . In addition, we had restricted cash and restricted deposits related to the loan to finance leasehold improvements in our office space of $1.2 million and $3.0 million as of December 31, 2022 and 2021, respectively.
In addition, we had restricted cash and restricted deposits related to the loan to finance leasehold improvements and our office space lease agreement of $1.3 million and $1.2 million as of December 31, 2023 and 2022, respectively. Our marketable securities amounted to $476.1 million and $431.1 million as of December 31, 2023 and 2022.
No Goodwill impairment was recorded for the years ended December 31, 2022 and 2021. Intangible assets that are considered to have definite useful life are amortized using the straight-line basis over their estimated useful lives, which ranges from 2 to 10 years.
Intangible assets that are considered to have definite useful life are amortized using the straight-line basis over their estimated useful lives, which ranges from 2 to 10 years.
The following table sets forth the geographic breakdown of revenues for the periods indicated: 2022 2021 2020 (in thousands) U.S. $ 172,704 $ 154,360 $ 100,706 Europe 84,484 77,019 48,331 Asia Pacific 48,585 38,437 22,814 Rest of the world 28,153 24,991 15,715 Israel 3,440 2,855 1,944 Total $ 337,366 $ 297,662 $ 189,510 Cost of revenue .
The following table sets forth the geographic breakdown of revenues for the periods indicated: 2023 2022 2021 (in thousands ) U.S. $ 178,450 $ 172,704 $ 154,360 Europe 95,593 84,484 77,019 Asia Pacific 54,400 48,585 38,437 Rest of the world 29,664 28,153 24,991 Israel 3,268 3,440 2,855 Total $ 361,375 $ 337,366 $ 297,662 Cost of revenue .
Our spend per buyer as of December 31, 2022, was $262, up 8% from $242 as of December 31, 2021. For the years ended December 31, 2022, and 2021 buyers who spent over $500 accounted for 63% of our core marketplace revenue.
Our spend per buyer as of December 31, 2023, was $278, up 6% from $262 as of December 31, 2022. For the year ended December 31, 2023, buyers who spent over $500 accounted for 64% of our core platform revenue, up from 63% for the year ended December 31, 2022.
We expect that our general and administrative expenses will grow over time as we grow our business, as well as to cover the additional cost and expenses associated with maintaining a publicly listed company. Impairment of intangible assets. Impairment of intangible assets and internal use software capitalization as a result of adverse change in macroeconomic conditions. Financial expenses, net.
General and administrative expenses are expensed as incurred. We expect that our general and administrative expenses will grow over time as we grow our business, as well as to cover the additional cost and expenses associated with maintaining a publicly listed company. Impairment of intangible assets.
Financial expenses , net primarily include amortization of discount and issuance costs of Convertible Notes, interest earned on cash and cash equivalents and marketable securities, exchange rate gains (losses) due to foreign exchange fluctuations and other financial expenses in connection with bank charges and long-term loan. Income taxes.
In addition, amortization of discount and issuance costs of our Convertible Notes, exchange rate gains (losses) due to foreign exchange fluctuations and other financial expenses in connection with bank charges and long-term loan. Income taxes. Income taxes primarily include reserves for uncertain tax positions.
Sales and marketing Sales and marketing expenses increased by $15.2 million, or 9.6%, to $174.6 million for the year ended December 31, 2022 from $159.4 million for the year ended December 31, 2021.
Sales and marketing Sales and marketing expenses decreased by $13.4 million, or 7.7%, to $161.2 million for the year ended December 31, 2023 from $174.6 million for the year ended December 31, 2022.
The estimated fair values and useful lives of identifiable intangible assets are based on many factors, including estimates and assumptions of future operating performance and cash flows of the acquired business, the nature of the business acquired and the specific characteristics of the identified intangible assets.
The excess of the purchase price over the amount allocated to the identifiable assets and liabilities, if any, is recorded as goodwill. 65 The estimated fair values and useful lives of identifiable intangible assets are based on many factors, including estimates and assumptions of future operating performance and cash flows of the acquired business, the nature of the business acquired and the specific characteristics of the identified intangible assets.
On that basis, we set out to design a digital marketplace that is built with a comprehensive SKU-like services catalog and an efficient search, find and order process that mirrors a typical e-commerce transaction. We believe our model reduces friction and uncertainties for both buyers and sellers.
On that basis, we set out to design a digital services marketplace that is built with a comprehensive SKU-like services catalog and an efficient search, find and order process that mirrors a typical e-commerce transaction. We call this the Service-as-a-Product, or the SaaP model.
General and administrative General and administrative expenses decreased by $1.5 million, or 2.8%, to $51.2 million for the year ended December 31, 2022 from $52.6 million for the year ended December 31, 2021.
General and administrative General and administrative expenses increased by $11.5 million, or 22.6%, to $62.7 million for the year ended December 31, 2023 from $51.2 million for the year ended December 31, 2022.
At the same time, this buyer may recommend our platform to a colleague in another department who may use our platform for video editing services. Repeat buyers generally increase spend on our platform over time.
For example, a buyer can purchase design content for a brochure and later return to our platform for market research, an entirely different service category. At the same time, this buyer may recommend our platform to a colleague in another department who may use our platform for video editing services. Repeat buyers generally increase spend on our platform over time.
Impairment of intangible assets A $27.6 million impairment of intangible assets and internal use software capitalization for the year ended December 31, 2022, resulted from an adverse change in macroeconomic conditions.
This was partially offset by a decrease of $1.4 million in employee-related costs. Impairment of intangible assets No impairment was recorded for the year ended December 31, 2023 with respect to intangible assets. A $27.6 million impairment of intangible assets and internal use software capitalization for the year ended December 31, 2022 resulted from an adverse change in macroeconomic conditions.
Our contract liabilities mainly consist of deferred revenues from transaction and service fees received in advance for services for which control has not been yet obtained by the customers. Internal-use software Costs incurred to develop internal-use software are capitalized and amortized over the estimated useful life of the software, which is generally three years.
Our contract liabilities mainly consist of deferred revenues from transaction and service fees received in advance for services for which control has not been yet obtained by the customers.
Sales and marketing expenses are primarily comprised of costs of our marketing personnel, performance marketing investments, branding costs, amortization of customer relationships, creative relationships and trade name and other advertising costs. Sales and marketing expenses are expensed as incurred.
A significant component is performance marketing investments such as user acquisition costs, branding costs, marketing campaigns and other media advertisements, and amortization of customer relationships, creative relationships and trade name and other advertising costs. Sales and marketing expenses are expensed as incurred.
If the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, the two-step impairment test is performed.
ASC 350 allows an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. If the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required.
Research and development Research and development costs increased by $13.3 million, or 16.7%, to $92.6 million for the year ended December 31, 2022 from $79.3 million for the year ended December 31, 2021.
Research and development Research and development costs decreased by $1.8 million, or 2.0%, to $90.7 million for the year ended December 31, 2023 from $92.6 million for the year ended December 31, 2022.
For the years ended December 31, 2022, 2021 and 2020, our revenue was $337.4 million, $297.7 million and $189.5 million, respectively, most of which was driven by repeat buyers whose collective spend on our platform continues to increase. These favorable dynamics provide us with revenue visibility and predictability.
Our revenue growth has been driven by a combination of active buyers, spend per buyer and take rate growth. For the years ended December 31, 2023, 2022 and 2021, our revenue was $361.4 million, $337.4 million, and $297.7 million, respectively, most of which was driven by repeat buyers whose collective spend on our platform continues to increase.
“Risk Factors—Risks related to our indebtedness and capital structure—The Capped Call Transaction may affect the value of our ordinary shares, and we may be subject to counterparty risk with respect to the Capped Call Transactions.” 54 C. Research and Development, Patents and Licenses, Etc.
In connection with the issuance of the Convertible Notes, we entered into privately negotiated capped call transactions with certain financial institutions. See Item 3.D. “Risk Factors—Risks related to our indebtedness and capital structure—The Capped Call Transaction may affect the value of our ordinary shares, and we may be subject to counterparty risk with respect to the Capped Call Transactions.” C.
Our business model We operate a marketplace model where we derive our revenue from transaction fees and service fees that are based on the total value of transactions ordered through our platform. Our revenue growth has been driven primarily by the growth of active buyers and spend per buyer.
Our business model We operate a marketplace model where we derive the majority of our revenue from transaction fees and service fees that are based on the total value of transactions ordered through our platform. Additionally, we drive certain revenues from value-added services provided to our buyer and seller community.
Cost of revenue Cost of revenue increased by $14.2 million, or 27.5%, to $65.9 million for the year ended December 31, 2022 from $51.7 million for the year ended December 31, 2021.
Cost of revenue Cost of revenue decreased by $4.1 million, or 6.2%, to $61.8 million for the year ended December 31, 2023 from $65.9 million for the year ended December 31, 2022.
The estimates and assumptions used to determine the fair values and useful lives of identified intangible assets could change due to numerous factors, including market conditions, technological developments, economic conditions and competition. 55 Contingent consideration incurred in a business combination is included as part of the acquisition price and recorded at a probability weighted assessment of the fair value as of the acquisition date.
The estimates and assumptions used to determine the fair values and useful lives of identified intangible assets could change due to numerous factors, including market conditions, technological developments, economic conditions and competition.
The consistent behavior of our cohorts is driven first by repeat spending by our buyers as well as by the overall size of our buyer base, which normalizes the fluctuation of individual buyer behavior.
The consistent behavior of our cohorts is driven first by repeat spending by our buyers as well as by the overall size of our buyer base, which normalizes the fluctuation of individual buyer behavior. We experienced elevated spending levels across our cohorts in 2020 and 2021, as COVID-19 led to more usage of remote and freelancer workforce.
The fair value of the contingent consideration is re-measured at each reporting period, with any adjustments in fair value recognized in earnings under general and administrative expenses. Acquisition related costs incurred by us are not included as a component of consideration transferred but are accounted for as an expense in the period in which the costs are incurred.
Contingent consideration incurred in a business combination is included as part of the acquisition price and recorded at a probability weighted assessment of the fair value as of the acquisition date. The fair value of the contingent consideration is re-measured at each reporting period, with any adjustments in fair value recognized in earnings under general and administrative expenses.
We believe we are able to command our take rate because of the value we provide to our buyers and sellers in an otherwise fragmented, unstandardized and high-friction industry.
Our take rate, or revenue as a percentage of GMV, was 31.8%, 30.2%, and 29.2% for the years ended December 31, 2023, 2022 and 2021, respectively. We believe we are able to command our take rate because of the value we provide to our buyers and sellers in an otherwise fragmented, unstandardized and high-friction industry.
Description of Convertible Notes and Capped Call Transaction Financing On October 13, 2020, we closed a private offering of $460.0 million principal amount of 0% coupon rate Convertible Senior Notes due 2025, or the Convertible Notes. The Convertible Notes were issued pursuant to an indenture, dated October 13, 2020, or the Indenture, between us and U.S.
This was partially offset by a decrease of $1.0 million in proceeds from exercise of share options. Description of Convertible Notes and Capped Call Transaction Financing On October 13, 2020, we closed a private offering of $460.0 million principal amount of 0% coupon rate Convertible Senior Notes due 2025, or the Convertible Notes.
Alternatively, ASC 350 permits an entity to bypass the qualitative assessment for any reporting unit and proceed directly to performing the first step of the goodwill impairment test. We operate in one reporting segment, and this segment comprises our only reporting unit.
If it does result in a more likely than not indication of impairment, the two-step impairment test is performed. Alternatively, ASC 350 permits an entity to bypass the qualitative assessment for any reporting unit and proceed directly to performing the first step of the goodwill impairment test.
This increase was primarily due to an increase of $2.9 million in payment processing fees driven by increase in revenue, an increase of $5.3 million due to employee-related costs and subcontractors costs, an increase of $3.2 million in amortization of capitalized internal-use software and developed technology, an increase of $1.1 million in share-based compensation, an increase of $0.9 million in hosting fees and an increase of $0.5 million in IT and production services.
This was primarily due to a decrease of $2.8 million in amortization of capitalized internal-use software and developed technology and a decrease of $1.7 million due to saving of talent and contractors services. The decrease was partially offset by an increase of $0.2 million in hosting costs and an increase of $0.2 million in employee-related costs and subcontractors costs.
This decrease primarily resulted from a $7.0 million decrease in tax withholding in connection with exercises of employees’ share options and vested RSU’s. This was partially offset by a decrease of $4.5 million in proceeds from exercise of share options and a decrease of $1.7 million in repayment of long-term loan.
This increase primarily resulted from a $2.3 million related to prior year repayment of long-term loan, a decrease of $2.1 million in tax withholding in connection with exercises of employees’ share options and vested RSU’s and $1.1 million due to prior year payment of contingent consideration.
This decrease was partially offset by an increase of $63.1 due to proceeds from maturities of marketable securities. 53 Net cash used in financing activities Net cash used in financing activities was $1.6 million for the year ended December 31, 2022, a decrease of $0.8 million compared to $2.4 million cash used in for the year ended December 31, 2021.
Net cash provided by (used in) financing activities Net cash provided by financing activities was $2.9 million for the year ended December 31, 2023, an increase of $4.5 million from ($1.6) million cash used in for the year ended December 31, 2022.
The increase was mainly due to a 1% increase in the number of active buyers and a 8% increase in spend per buyer over the same time period and an increase of 100 basis points in our take rate, as we continue to grow our core platform including continued expansion of freelancer tools such as Promoted Gigs and Seller Plus, as well as the additional revenue from back-office software subscriptions, e-learning courses, content marketing subscriptions, creative talent platform, and freelancer management platform.
We continue to grow our core platform and continued expansion of freelancer tools such as Promoted Gigs and Seller Plus, as well as the additional revenue e-learning courses, content marketing subscriptions, creative talent platform and freelancer management platform.
This increase was primarily driven by increases of $10.2 million in performance marketing investments and other marketing campaigns and brand activities, an increase of $3.1 million in share-based compensation and an increase of $2.2 million in employee-related and subcontractors costs.
This decrease was primarily driven by a lower investment of $6.4 million in marketing campaigns and brand activities, a decrease of $3.9 million in share-based compensation, a decrease of $1.5 million in employee-related and subcontractors costs, a decrease of $1.3 million in intangible assets amortization and a decrease of $0.3 million in hedging expenses.
We do not rely on a direct sales force, further enhancing the scalability of our business model. Our revenue is well diversified across our buyers, with no buyer contributing more than 1% of core marketplace revenue in the years ended December 31, 2022, 2021 or 2020.
Our revenue is well diversified across our buyers, with no buyer contributing more than 1% of core platform revenue in the years ended December 31, 2023, 2022 or 2021. We drive a majority of our buyer acquisition through organic channels, supplemented by efficient performance marketing investments.
As shown in the figure below, the aggregate spend of each cohort stabilizes after the first year and continues to contribute to a consistent stream of revenue for future years.
Historically, we have observed consistency across our annual buyer cohorts. As shown in the figure below, the biggest fluctuation in spend of each cohort happens in the first two years and then starts to stabilize and contribute to a consistent stream of revenue for future years.
This increase was primarily driven by an increase of $7.4 million in employee-related and subcontractors costs, an increase of $3.9 million in share-based compensation and an increase of $1.7 million in IT subscriptions and other.
This was primarily driven by a decrease of $1.0 million in employee-related and subcontractors costs, a decrease of $0.7 million in facilities maintenance and related operational costs and a decrease of $0.5 million in hedging activity. This was partially offset by an increase of $0.4 million in IT & hosting services.
The number of active buyers on our platform has reached 4.3 million as of December 31, 2022, up from 4.2 million as of December 31, 2021. The key drivers of our active buyer base growth are continued buyer engagement and our buyer acquisition strategy. We are focused on increasing this strong base of active buyers, which we continue to monetize.
The key drivers of our active buyer base growth are continued buyer engagement and our buyer acquisition strategy. We are focused on increasing this strong base of active buyers, which we continue to monetize. We experience significant repeat business because buyers return to our platform as we offer a variety of freelance digital services that address different businesses’ needs.
We elected to perform an annual impairment test of goodwill as of October 1st of each year, or more frequently if impairment indicators are present. Due to the adverse change in macro-economic conditions mentioned in note 2h we preformed additional goodwill impairment test as of June 30, 2022.
We operate in one reporting segment, and this segment comprises our only reporting unit. We elected to perform an annual impairment test of goodwill as of October 1st of each year, or more frequently if impairment indicators are present.
We believe the repeat purchase activity from existing buyers reflects the underlying strength of our business and provides us with revenue visibility and predictability. 46 Consistent cohort behavior Our business has historically benefited from strong cohort revenue consistency.
For the year ended December 31, 2023, repeat buyers contributed 66% of our revenue on our core platform, up from 63% in the year ended December 31, 2022. We believe the repeat purchase activity from existing buyers reflects the underlying strength of our business and provides us with revenue visibility and predictability.
General and administrative expenses primarily include costs of our executive, finance, legal and other administrative personnel, costs associated with fraud risk reduction and others. General and administrative expenses are expensed as incurred.
General and administrative expenses primarily include overhead related costs, including share-based compensation of the Company’s executive, finance, legal, human resources and other administrative personnel. General and administrative expenses also include legal, accounting and other professional service fees, other corporate expenses, as well as chargeback expenses and costs associated with fraud risk reduction and others.
Net cash used in investing activities Net cash used in investing activities was $14.6 million for the year ended December 31, 2022, a decrease of $214.8 million compared to $229.5 million for the year ended December 31, 2021.
Net cash provided by (used in) investing activities Net cash provided by investing activities was $9.8 million for the year ended December 31, 2023, an increase of $24.4 million from ($14.6) million cash used in for the year ended December 31, 2022. The increase primarily resulted from $167.5 million of investments in marketable securities.
In 2025, our Convertible Notes (as defined below) will mature, and, depending on the price of our ordinary shares, we may need to pay the principal amount in cash, which as of December 31, 2022 is up to $460 million. Our primary requirements for liquidity and capital resources are to finance working capital, capital expenditures and general corporate purposes.
We also expect our sources of liquidity will be sufficient to fund our office lease long-term contractual obligations and the capital needs for our Convertible Notes (as defined below) that will mature in 2025, and, depending on the price of our ordinary shares, we may need to pay the principal amount in cash.
This was partially offset by an increase of $0.9 million due to financial expenses related to hedging transactions and a $0.6 million increase in bank charges and commissions. Income taxes Income taxes increased by $0.4 million for the year ended December 31, 2022 mainly due to uncertain tax provision. 52 B.
Income taxes Income taxes increased by $0.8 million for the year ended December 31, 2023 mainly due to uncertain tax provision and income taxes in the US. B.
However, this is subject, to a certain extent, to general economic, financial, competitive, regulatory and other factors that are beyond our control. Our future financing requirements will depend on many factors including our growth rate, the timing and extent of spending to support development of our platform and the expansion of marketing activities.
Our future financing requirements will depend on many factors including our growth rate, the timing and extent of spending to support development of our platform and the expansion of marketing activities. Our capital expenditures for fiscal years 2023, 2022 and 2021 amounted to $1.1 million, $2.2 million and $2.6 million, respectively.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeCompensation committee role In accordance with the Companies Law, the roles of the compensation committee are, among others, as follows: • recommending to the board of directors with respect to the approval of the compensation policy for office holders and, once every three years, regarding any extensions to a compensation policy that was adopted for a period of more than three years; • reviewing the implementation of the compensation policy and periodically recommending to the board of directors with respect to any amendments or updates of the compensation policy; • resolving whether or not to approve arrangements with respect to the terms of office and employment of office holders; and • exempting, under certain circumstances, a transaction with our chief executive officer from the approval of the general meeting of our shareholders. 66 Our board of directors has adopted a compensation committee charter setting forth the responsibilities of the committee consistent with the New York Stock Exchange rules, which include among others: • recommending to our board of directors for its approval a compensation policy in accordance with the requirements of the Companies Law as well as other compensation policies, incentive-based compensation plans and equity-based compensation plans, and overseeing the development and implementation of such policies and recommending to our board of directors any amendments or modifications the committee deems appropriate, including as required under the Companies Law; • reviewing and approving the granting of options and other incentive awards to the chief executive officer and other executive officers, including reviewing and approving corporate goals and objectives relevant to the compensation of our chief executive officer and other executive officers, including evaluating their performance in light of such goals and objectives; • overseeing and periodically reviewing with management our strategies, policies and practices with respect to human capital management and management development, including with respect to matters such as diversity, equity, and inclusion; workplace environment and culture; employee engagement and effectiveness; and talent recruitment, development, and retention; • approving and exempting certain transactions regarding office holders’ compensation pursuant to the Companies Law; and • administering our equity-based compensation plans, including without limitation, approving the adoption of such plans, amending and interpreting such plans and the awards and agreements issued pursuant thereto, and making awards to eligible persons under the plans and determining the terms of such awards.
Biggest changeOur board of directors has adopted a compensation committee charter setting forth the responsibilities of the committee consistent with the New York Stock Exchange rules, which include among others: • recommending to our board of directors for its approval a compensation policy in accordance with the requirements of the Companies Law as well as other compensation policies, incentive-based compensation plans and equity-based compensation plans, and overseeing the development and implementation of such policies and recommending to our board of directors any amendments or modifications the committee deems appropriate, including as required under the Companies Law; • reviewing and approving the granting of options and other incentive awards to the chief executive officer and other executive officers, including reviewing and approving corporate goals and objectives relevant to the compensation of our chief executive officer and other executive officers, including evaluating their performance in light of such goals and objectives; • overseeing and periodically reviewing with management our strategies, policies and practices with respect to human capital management and management development, including with respect to matters such as diversity, equity, and inclusion; workplace environment and culture; employee engagement and effectiveness; and talent recruitment, development, and retention; • approving and exempting certain transactions regarding office holders’ compensation pursuant to the Companies Law; and • administering our equity-based compensation plans, including without limitation, approving the adoption of such plans, amending and interpreting such plans and the awards and agreements issued pursuant thereto, and making awards to eligible persons under the plans and determining the terms of such awards.
Our board of directors has adopted a nominating and governance committee charter setting forth the responsibilities, which include: • overseeing and assisting our board in reviewing and recommending nominees for election as directors; • assessing the performance of the members of our board; • establishing and maintaining effective corporate governance policies and practices, including, but not limited to, developing and recommending to our board a set of corporate governance guidelines applicable to our company; and • overseeing the Company’s risks, strategies, policies, programs and practices related to environmental, social and governance (ESG) matters.
Our board of directors has adopted a nominating and ESG committee charter setting forth the responsibilities, which include: • overseeing and assisting our board in reviewing and recommending nominees for election as directors; • assessing the performance of the members of our board of directors; • establishing and maintaining effective corporate governance policies and practices, including, but not limited to, ESG policies, programs and strategies, and developing and recommending to our board of directors a set of corporate governance guidelines applicable to our company; and • overseeing the Company’s risks, strategies, policies, programs and practices related to environmental, social and governance (ESG) matters.
The compensation policy must furthermore consider the following additional factors: • the education, skills, experience, expertise and accomplishments of the relevant office holder; • the office holder’s position, responsibilities and prior compensation agreements with him or her; • the ratio between the cost of the terms of employment of an office holder and the cost of the employment of other employees of the company, including employees employed through contractors who provide services to the company, in particular the ratio between such cost to the average and median salary of such employees of the company, as well as the impact of disparities between them on the work relationships in the company; 67 • if the terms of employment include variable components—the possibility of reducing variable components at the discretion of the board of directors and the possibility of setting a limit on the value of non-cash variable equity-based components; and • if the terms of employment include severance compensation—the term of employment or office of the office holder, the terms of his or her compensation during such period, the company’s performance during such period, his or her individual contribution to the achievement of the company goals and the maximization of its profits and the circumstances under which he or she is leaving the company.
The compensation policy must furthermore consider the following additional factors: • the education, skills, experience, expertise and accomplishments of the relevant office holder; • the office holder’s position, responsibilities and prior compensation agreements with him or her; • the ratio between the cost of the terms of employment of an office holder and the cost of the employment of other employees of the company, including employees employed through contractors who provide services to the company, in particular the ratio between such cost to the average and median salary of such employees of the company, as well as the impact of disparities between them on the work relationships in the company; • if the terms of employment include variable components—the possibility of reducing variable components at the discretion of the board of directors and the possibility of setting a limit on the value of non-cash variable equity-based components; and • if the terms of employment include severance compensation—the term of employment or office of the office holder, the terms of his or her compensation during such period, the company’s performance during such period, his or her individual contribution to the achievement of the company goals and the maximization of its profits and the circumstances under which he or she is leaving the company.
The maximum amount set forth in such agreements is in addition to any amount paid (if paid) under insurance and/or by a third-party pursuant to an indemnification arrangement. In the opinion of the SEC, indemnification of directors and office holders for liabilities arising under the Securities Act is against public policy and therefore unenforceable. 72 D.
The maximum amount set forth in such agreements is in addition to any amount paid (if paid) under insurance and/or by a third-party pursuant to an indemnification arrangement. In the opinion of the SEC, indemnification of directors and office holders for liabilities arising under the Securities Act is against public policy and therefore unenforceable. D.
Disclosure of personal interests of an office holder and approval of certain transactions The Companies Law requires that an office holder promptly disclose to the board of directors any personal interest that he or she may have and all related material information known to him or her concerning any existing or proposed transaction with the company.
Disclosure of personal interests of an office holder and approval of certain transactions The Companies Law requires that an office holder will promptly disclose to the board of directors any personal interest that he or she may have and all related material information known to him or her concerning any existing or proposed transaction with the company.
(acquired by Microsoft Corporation), Wilocity (acquired by Qualcomm Incorporated) and Onavo (acquired by Facebook, Inc.). Mr. Katz holds a B.A. from Tel Aviv University in Israel. Hila Klein has served as our Chief Operating Officer since January 2019. Prior to joining us, Ms.
(acquired by Microsoft Corporation), Wilocity (acquired by Qualcomm Incorporated) and Onavo (acquired by Facebook, Inc.). Mr. Katz holds a B.A. from Tel Aviv University in Israel. 67 Hila Klein has served as our Chief Operating Officer since January 2019. Prior to joining us, Ms.
However, if an undertaking to indemnify an office holder with respect to such liability is provided in advance, then such an undertaking must be limited to events which, in the opinion of the board of directors, can be foreseen based on the company’s activities when the undertaking to indemnify is given, and to an amount or according to criteria determined by the board of directors as reasonable under the circumstances, and such undertaking shall detail the above-mentioned events and amount or criteria; • reasonable litigation expenses, including attorneys’ fees, incurred by the office holder (1) as a result of an investigation or proceeding instituted against him or her by an authority authorized to conduct such investigation or proceeding, provided that (i) no indictment was filed against such office holder as a result of such investigation or proceeding; and (ii) no financial liability, such as a criminal penalty, was imposed upon him or her as a substitute for the criminal proceeding as a result of such investigation or proceeding or, if such financial liability was imposed, it was imposed with respect to an offense that does not require proof of criminal intent and (2) in connection with a monetary sanction; • reasonable litigation expenses, including attorneys’ fees, incurred by the office holder or imposed by a court in proceedings instituted against him or her by the company, on its behalf or by a third-party or in connection with criminal proceedings in which the office holder was acquitted or as a result of a conviction for an offense that does not require proof of criminal intent; and • expenses, including reasonable litigation expenses and legal fees, incurred by an office holder in relation to an administrative proceeding instituted against such office holder, or certain compensation payments made to an injured party imposed on an office holder by an administrative proceeding, pursuant to certain provisions of the Israeli Securities Law, 1968 (the “Israeli Securities Law”).
However, if an undertaking to indemnify an office holder with respect to such liability is provided in advance, then such an undertaking must be limited to events which, in the opinion of the board of directors, can be foreseen based on the company’s activities when the undertaking to indemnify is given, and to an amount or according to criteria determined by the board of directors as reasonable under the circumstances, and such undertaking shall detail the above-mentioned events and amount or criteria; 81 • reasonable litigation expenses, including attorneys’ fees, incurred by the office holder (1) as a result of an investigation or proceeding instituted against him or her by an authority authorized to conduct such investigation or proceeding, provided that (i) no indictment was filed against such office holder as a result of such investigation or proceeding; and (ii) no financial liability, such as a criminal penalty, was imposed upon him or her as a substitute for the criminal proceeding as a result of such investigation or proceeding or, if such financial liability was imposed, it was imposed with respect to an offense that does not require proof of criminal intent and (2) in connection with a monetary sanction; • reasonable litigation expenses, including attorneys’ fees, incurred by the office holder or imposed by a court in proceedings instituted against him or her by the company, on its behalf or by a third-party or in connection with criminal proceedings in which the office holder was acquitted or as a result of a conviction for an offense that does not require proof of criminal intent; and • expenses, including reasonable litigation expenses and legal fees, incurred by an office holder in relation to an administrative proceeding instituted against such office holder, or certain compensation payments made to an injured party imposed on an office holder by an administrative proceeding, pursuant to certain provisions of the Israeli Securities Law, 1968, or the Israeli Securities Law.
Under these regulations, the exemptions from such Companies Law requirements will continue to be available to us so long as: (i) we do not have a “controlling shareholder” (as such term is defined under the Companies Law), (ii) our shares are traded on certain U.S. stock exchanges, including the New York Stock Exchange, and (iii) we comply with the director independence requirements and the audit committee and compensation committee composition requirements under U.S. laws (including applicable New York Stock Exchange rules) applicable to U.S. domestic issuers. 63 Our board of directors has adopted corporate governance guidelines which serve as a flexible framework which our board of directors and its committees operate within, subject to the requirements of applicable law and regulations.
Under these regulations, the exemptions from such Companies Law requirements will continue to be available to us so long as: (i) we do not have a “controlling shareholder” (as such term is defined under the Companies Law), (ii) our shares are traded on certain U.S. stock exchanges, including the New York Stock Exchange, and (iii) we comply with the director independence requirements and the audit committee and compensation committee composition requirements under U.S. laws (including applicable New York Stock Exchange rules) applicable to U.S. domestic issuers. 73 Our board of directors has adopted corporate governance guidelines which serve as a flexible framework which our board of directors and its committees operate within, subject to the requirements of applicable law and regulations.
Our board of directors, or a duly authorized committee of our board of directors, administers the 2011 Plan. 62 2019 Share Incentive Plan We maintain the 2019 Plan, under which we may grant equity based incentive awards to attract, motivate and retain the talent for which we compete.
Our board of directors, or a duly authorized committee of our board of directors, administers the 2011 Plan. 2019 Share Incentive Plan We maintain the 2019 Plan, under which we may grant equity based incentive awards to attract, motivate and retain the talent for which we compete.
The duty of care requires an office holder to act with the level of care with which a reasonable office holder in the same position would have acted under the same circumstances. The duty of loyalty requires that an office holder act in good faith and in the best interests of the company.
The duty of care requires an office holder to act with the level of care with which a reasonable office holder in the same position would have acted under the same circumstances. The duty of loyalty requires that an office holder will act in good faith and in the best interests of the company.
However, if the shareholders of the company do not approve the compensation arrangement with the chief executive officer, the compensation committee and the board of directors may override the shareholders’ decision if each of the compensation committee and the board of directors provide a detailed reasons for their decision.
However, if the shareholders of the company do not approve the compensation arrangement with the chief executive officer, the compensation committee and the board of directors may override the shareholders’ decision if each of the compensation committee and the board of directors provide detailed reasons for their decision.
Our board of directors has determined that each member of our audit committee is “independent” as such term is defined in Rule 10A-3(b)(1) under the Exchange Act, which is different from the general test for independence of board and committee members. 65 Audit committee role Our board of directors has adopted an audit committee charter setting forth the responsibilities of the audit committee, which are also consistent with the Companies Law, the SEC rules and the New York Stock Exchange corporate governance rules.
Our board of directors has determined that each member of our audit committee is “independent” as such term is defined in Rule 10A-3(b)(1) under the Exchange Act, which is different from the general test for independence of board and committee members. 75 Audit committee role Our board of directors has adopted an audit committee charter setting forth the responsibilities of the audit committee, which are also consistent with the Companies Law, the SEC rules and the New York Stock Exchange corporate governance rules.
A director so appointed will hold office until the next annual general meeting of our shareholders for the class in respect of which the vacancy was created, or in the case of a vacancy due to the number of directors being less than the maximum number of directors stated in the articles, until the next annual general meeting of our shareholders for the class he or she has been assigned by our board of directors. 64 Chairperson of the board Our amended and restated articles of association provide that the chairperson of the board is appointed by the members of the board of directors.
A director so appointed will hold office until the next annual general meeting of our shareholders for the class in respect of which the vacancy was created, or in the case of a vacancy due to the number of directors being less than the maximum number of directors stated in the articles, until the next annual general meeting of our shareholders for the class he or she has been assigned by our board of directors. 74 Chairperson of the board Our amended and restated articles of association provide that the chairperson of the board is appointed by the members of the board of directors.
Any such transaction that is adverse to the company’s interests may not be approved by the board of directors. 69 Approval first by the company’s audit committee and subsequently by the board of directors is required for an extraordinary transaction (meaning, any transaction that is not in the ordinary course of business, not on market terms or that is likely to have a material impact on the company’s profitability, assets or liabilities) in which an office holder has a personal interest.
Any such transaction that is adverse to the company’s interests may not be approved by the board of directors. 80 Approval first by the company’s audit committee and subsequently by the board of directors is required for an extraordinary transaction (meaning, any transaction that is not in the ordinary course of business, not on market terms or that is likely to have a material impact on the company’s profitability, assets or liabilities) in which an office holder has a personal interest.
The maximum number of ordinary shares available for issuance under the 2019 Plan is equal to the sum of (i) 560,854 shares, (ii) any shares subject to awards under the 2011 Plan which will expire or become unexercisable without having been exercised, and (iii) an annual increase on the first day of each year beginning in 2020 and ending in and including 2029, equal to the lesser of (A) 14,259,677 shares, (B) 5% of the outstanding shares on the last day of the immediately preceding calendar year on a fully diluted basis and (C) such amount as determined by our board of directors if so determined, prior to January 1 of a calendar year; provided, however, that no more than 14,820,531 shares may be issued upon the exercise of incentive stock options, or ISOs.
The maximum number of ordinary shares available for issuance under the 2019 Plan is equal to the sum of (i) 560,807 shares, (ii) any shares subject to awards under the 2011 Plan which will expire or become unexercisable without having been exercised, and (iii) an annual increase on the first day of each year beginning in 2020 and ending in and including 2029, equal to the lesser of (A) 14,259,677 shares, (B) 5% of the outstanding shares on the last day of the immediately preceding calendar year on a fully diluted basis and (C) such amount as determined by our board of directors if so determined, prior to January 1 of a calendar year; provided, however, that no more than 14,820,484 shares may be issued upon the exercise of incentive stock options, or ISOs.
As of December 31, 2022, Ms. Sharon Cohen, CPA from Deloitte IL & Co, a firm in the Deloitte Global Network is acting as our internal auditor. Approval of related party transactions under Israeli law Fiduciary duties of directors and executive officers The Companies Law codifies the fiduciary duties that office holders owe to a company.
As of December 31, 2023, Ms. Sharon Cohen, CPA from Deloitte IL & Co, a firm in the Deloitte Global Network is acting as our internal auditor. Fiduciary Duties and Approval of related party transactions under Israeli law Fiduciary duties of directors and executive officers The Companies Law codifies the fiduciary duties that office holders owe to a company.
The following is a summary of the salary expenses and social benefit costs of our five most highly compensated executive officers in 2022 or the Covered Executives. All amounts reported reflect the cost to the Company as recognized in our financial statements for the year ended December 31, 2022.
The following is a summary of the salary expenses and social benefit costs of our five most highly compensated executive officers in 2023, or the Covered Executives. All amounts reported reflect the cost to the Company as recognized in our financial statements for the year ended December 31, 2023.
The responsibilities of the audit committee include: • retaining and terminating our independent auditors, subject to the ratification of the board of directors, and in the case of retention, to that of the shareholders; • pre-approving of audit and non-audit services and related fees and terms, to be provided by the independent auditors; • overseeing the accounting and financial reporting processes of our company, the audits of our financial statements, the effectiveness of our internal control over financial reporting and making such reports as may be required of an audit committee under the rules and regulations promulgated under the Exchange Act; • overseeing the Company policies with respect to risk assessment and risk management, including with respect to financial and cybersecurity related risks; • reviewing with management and our independent auditor our annual and quarterly financial statements prior to publication or filing (or submission, as the case may be) to the SEC; • recommending to the board of directors the retention and termination of the internal auditor, and the internal auditor’s engagement fees and terms, in accordance with the Companies Law, as well as approving the yearly or periodic work plan proposed by the internal auditor; • reviewing with our general counsel and/or external counsel, as deemed necessary, legal and regulatory matters that could have a material impact on the financial statements; • identifying irregularities in our business administration, inter alia, by consulting with the internal auditor or with the independent auditor, and suggesting corrective measures to the board of directors; • reviewing policies and procedures with respect to transactions (other than transactions related to the compensation or terms of services) between the Company and officers and directors, or affiliates of officers or directors, or transactions that are not in the ordinary course of the Company’s business and deciding whether to approve such acts and transactions if so required under the Companies Law; and • establishing procedures for the handling of employees’ complaints as to the management of our business and the protection to be provided to such employees.
The responsibilities of the audit committee include: • retaining and terminating our independent auditors, subject to the ratification of the board of directors, and in the case of retention, to that of the shareholders; • pre-approving of audit and non-audit services and related fees and terms, to be provided by the independent auditors; • overseeing the accounting and financial reporting processes of our company, the audits of our financial statements, the effectiveness of our internal control over financial reporting and making such reports as may be required of an audit committee under the rules and regulations promulgated under the Exchange Act; • overseeing the Company policies with respect to risk assessment and risk management, including with respect to financial, information security and cybersecurity related risks; • reviewing with management and our independent auditor our annual, semi-annual and quarterly financial statements prior to publication or filing (or submission, as the case may be) to the SEC; • recommending to the board of directors the retention and termination of the internal auditor, and the internal auditor’s engagement fees and terms, in accordance with the Companies Law, as well as reviewing and approving the yearly or periodic work plan proposed by the internal auditor; • reviewing with our general counsel and/or external counsel, as deemed necessary, legal and regulatory matters that could have a material impact on the financial statements; • Receiving reports of suspected irregularities in our business administration, inter alia, by members of the Company’s management, legal counsel, the independent or internal auditor, and suggesting corrective measures to the board of directors; • reviewing policies and procedures with respect to transactions (other than transactions related to the compensation or terms of services) between the Company and officers and directors, or affiliates of officers or directors, or transactions that are not in the ordinary course of the Company’s business and deciding whether to approve such acts and transactions if so required under the Companies Law; and • establishing and overseeing procedures and policies for the handling of employees’ complaints as to the management of our business and the protection to be provided to such employees.
This amount includes $0.74 million of amounts set aside or accrued to provide pension, severance, retirement or similar benefits or expenses, but does not include business travel, relocation, professional and business association dues and expenses reimbursed to office holders.
This amount includes $0.78 million of amounts set aside or accrued to provide pension, severance, retirement or similar benefits or expenses, but does not include business travel, relocation, professional and business association dues and expenses reimbursed to office holders.
Under the Companies Law, the compensation of our directors requires the approval of our compensation committee, the subsequent approval of the board of directors and, unless exempted under regulations promulgated under the Companies Law, the approval of the shareholders at a general meeting.
Compensation Compensation of directors and executive officers Directors. Under the Companies Law, the compensation of our directors requires the approval of our compensation committee, the subsequent approval of the board of directors and, unless exempted under regulations promulgated under the Companies Law, the approval of the shareholders at a general meeting.
In the event that the chief executive officer also serves as a member of the board of directors, his or her compensation terms as chief executive officer will be approved in accordance with the rules applicable to approval of compensation of directors. 60 Compensation of our office holders The aggregate compensation paid by us and our subsidiaries to our executive officers and directors, including share-based compensation, for the year ended December 31, 2022, was approximately $29.2 million.
In the event that the chief executive officer also serves as a member of the board of directors, his or her compensation terms as chief executive officer will be approved in accordance with the rules applicable to approval of compensation of directors. 69 Compensation of our office holders The aggregate compensation paid by us and our subsidiaries to our executive officers and directors, including share-based compensation, for the year ended December 31, 2023, was approximately $29.6 million.
Prior to co-founding Fiverr, Mr. Kaufman founded and led several technology ventures, including Keynesis Ltd., Invisia Ltd. and Spotback Ltd. Mr. Kaufman has served as a member of the Advisory Board of Cerca Partners LP, a venture capital firm, since November 2016. Mr. Kaufman holds an LL.B degree from Haifa University in Israel.
Prior to co-founding Fiverr, Mr. Kaufman founded and led several technology ventures. Mr. Kaufman has served as a member of the Advisory Board of Cerca Partners LP, a venture capital firm, since November 2016. Mr. Kaufman holds an LL.B degree from Haifa University in Israel.
Our directors are divided among the three classes as follows: • the Class I directors are Philippe Botteri and Jonathan Kolber and their terms expire at our annual general meeting of shareholders to be held in 2023; • the Class II directors are Adam Fisher and Nir Zohar, and their terms expire at our annual meeting of shareholders to be held in 2024; and • the Class III directors are Micha Kaufman, Ron Gutler and Gili Iohan, and their terms expire at our annual meeting of shareholders to be held in 2025.
Our directors are divided among the three classes as follows: • the Class I directors are Jonathan Kolber and Yael Garten and their terms expire at our annual general meeting of shareholders to be held in 2026; • the Class II directors are Adam Fisher and Nir Zohar, and their terms expire at our annual meeting of shareholders to be held in 2024; and • the Class III directors are Micha Kaufman, Ron Gutler and Gili Iohan, and their terms expire at our annual meeting of shareholders to be held in 2025.
Our compensation policy was approved by our board of directors and shareholders and became effective upon the closing of our IPO and was further amended by our compensation committee, board of directors and shareholders at our 2021 annual general meeting. Nominating and governance committee Our nominating and governance committee consists of Ron Gutler, Gili Iohan and Nir Zohar. Mr.
Our compensation policy was approved by our board of directors and shareholders and became effective upon the closing of our IPO and was further amended by our compensation committee, board of directors and shareholders at our 2021 annual general meeting and our 2023 annual general meeting. 79 Nominating, and ESG committee Our nominating and ESG committee consists of Ron Gutler, Gili Iohan and Nir Zohar.
In case of service of less than a twelve months period, the annual fee shall be prorated with respect to the actual period of service. Equity Based Compensation Welcome Grant – Each newly appointed or elected non-executive director of the Company shall be granted options with a grant date value of $350,000.
In case of service of less than a twelve months period, the annual fee shall be prorated with respect to the actual period of service. Equity Based Compensation Welcome Grant – Each newly appointed or elected non-executive director of the Company shall be granted restricted share units with a grant date value of $300,000.
U.S. dollar amounts indicated for compensation of our Covered Executives are in thousands of dollars. Mr. Micha Kaufman, Co-Founder, Chief Executive Officer and Chairperson of the Board. Compensation expenses recorded in 2022 of $300 in salary expenses and $89 in social benefits costs. Mr. Ofer Katz, President and Chief Financial Officer.
U.S. dollar amounts indicated for compensation of our Covered Executives are in thousands of dollars. Mr. Micha Kaufman, Co-Founder, Chief Executive Officer and Chairperson of the Board. Compensation expenses recorded in 2023 of $500 in salary expenses and $115 in social benefits costs. Mr. Ofer Katz, President and Chief Financial Officer.
In accordance with the Company’s compensation policy, we also paid cash bonuses to our Covered Executives as approved by the compensation committee and the board of directors. The 2022 cash bonus expenses for Mr. Micha Kaufman, Mr. Ofer Katz, Ms. Hila Klein, Ms. Gali Arnon and Ms.
In accordance with the Company’s compensation policy, we also paid cash bonuses to our Covered Executives as approved by the compensation committee and the board of directors. The 2023 cash bonus expenses, including social benefits costs, for Mr. Micha Kaufman, Mr. Ofer Katz, Ms. Hila Klein, Ms. Gali Arnon and Ms.
An Israeli company may not exculpate a director from liability arising out of a prohibited dividend or distribution to shareholders. 70 An Israeli company may indemnify an office holder in respect of the following liabilities and expenses incurred for acts performed as an office holder, either in advance of an event or following an event, provided a provision authorizing such indemnification is contained in its articles of association: • financial liability imposed on him or her in favor of another person pursuant to a judgment, settlement or arbitrator’s award approved by a court.
An Israeli company may indemnify an office holder in respect of the following liabilities and expenses incurred for acts performed as an office holder, either in advance of an event or following an event, provided a provision authorizing such indemnification is contained in its articles of association: • financial liability imposed on him or her in favor of another person pursuant to a judgment, settlement or arbitrator’s award approved by a court.
Directors and Senior Management Executive Officers and Directors The following table presents information about our current executive officers and directors as of March 15, 2023: Name Position Executive Officers Micha Kaufman Co-Founder, Chief Executive Officer, Chairperson of the Board Ofer Katz President and Chief Financial Officer Hila Klein Chief Operating Officer Gali Arnon Chief Marketing Officer Sharon Steiner Chief Human Resources Officer Directors Philippe Botteri Director Adam Fisher Director Ron Gutler Director Gili Iohan Director Jonathan Kolber Director Nir Zohar Director 58 Executive Officers Micha Kaufman , our Co-Founder, has served as our Chief Executive Officer and as a member of our board of directors since our inception and currently also serves as Chairperson of our board of directors.
Directors and Senior Management Executive Officers and Directors The following table presents information about our current executive officers and directors as of February 15, 2024: Name Position Executive Officers Micha Kaufman Co-Founder, Chief Executive Officer, Chairperson of the Board Ofer Katz President and Chief Financial Officer Hila Klein Chief Operating Officer Gali Arnon Chief Business Officer, Marketplace Matti Yahav Chief Marketing Officer Sharon Steiner Chief Human Resources Officer Directors Adam Fisher Director Yael Garten Director Ron Gutler Director Gili Iohan Director Jonathan Kolber Director Nir Zohar Director Executive Officers Micha Kaufman , our Co-Founder, has served as our Chief Executive Officer and as a member of our board of directors since our inception and currently also serves as Chairperson of our board of directors.
Klein spent approximately fifteen years at 888 Holdings Plc, serving in various roles including Director of House Gaming and Vice President, Casino & Bingo. Most recently at 888 Holdings, she served as Senior Vice President, Head of Product Technologies Division from April 2011 through December 2018. Ms. Klein holds a BS.c in Industrial Engineering from Technion—Israel Institute of Technology.
Klein spent approximately fifteen years at 888 Holdings Plc, serving in various roles including Director of House Gaming and Vice President, Casino & Bingo. Most recently at 888 Holdings, she served as Senior Vice President, Head of Product Technologies Division from April 2011 through December 2018. Ms.
In no event will more than 5,500,000 ordinary shares be available for issuance under the Section 423 Component. As of December 31, 2022, the ESPP Share Pool consisted of 701,205 ordinary shares.
In no event will more than 5,500,000 ordinary shares be available for issuance under the Section 423 Component. As of December 31, 2023, the ESPP Share Pool consisted of 1,004,211 ordinary shares.
Our office holders are currently covered by a directors and officers’ liability insurance policy. 71 We have entered into agreements with each of our directors and executive officers exculpating them, to the fullest extent permitted by law, from liability to us for damages caused to us as a result of a breach of duty of care, and undertaking to indemnify them to the fullest extent permitted by law.
We have entered into agreements with each of our directors and executive officers exculpating them, to the fullest extent permitted by law, from liability to us for damages caused to us as a result of a breach of duty of care, and undertaking to indemnify them to the fullest extent permitted by law.
Share Ownership For information regarding the share ownership of directors and officers, see Item 7.A. “ Major Shareholders and Related Party Transactions—Major Shareholders. ” For information as to our equity incentive plans, see Item 6.B. “ Director, Senior Management and Employees— Compensation —Share Option Plans. ” 73
Share Ownership For information regarding the share ownership of directors and officers, see Item 7.A. “ Major Shareholders and Related Party Transactions—Major Shareholders. ” For information as to our equity incentive plans, see Item 6.B. “ Director, Senior Management and Employees—Compensation—Share Option Plans. ” F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation. None.
Gutler serves as chairperson of the nominating and governance committee.
Mr. Gutler serves as chairperson of the nominating and ESG committee.
Sharon Steiner, as provided for in our 2022 financial statements (but due during 2023), were $0, $278, $212, $145 and $133, respectively. We recorded equity-based compensation expenses in our financial statements for the year ended December 31, 2022, for options and restricted share units granted to Mr. Micha Kaufman, Mr. Ofer Katz, Ms. Hila Klein, Ms. Gali Arnon and Ms.
Sharon Steiner, as provided for in our 2023 financial statements (but due during 2024), were $598, $333, $237, $163 and $92, respectively. 70 We recorded equity-based compensation expenses in our financial statements for the year ended December 31, 2023, for options and restricted share units granted to Mr. Micha Kaufman, Mr. Ofer Katz, Ms. Hila Klein, Ms.
The equity-based compensation shall be granted from time to time and be individually determined and awarded according to the performance, educational background, prior business experience, qualifications, role and the personal responsibilities of the executive officer. 68 In addition, our compensation policy contains compensation recovery provisions which allow us under certain conditions to recover bonuses paid in excess, enable our chief executive officer to approve an immaterial change in the terms of employment of an executive officer who reports directly him (provided that the changes of the terms of employment are in accordance with our compensation policy) and allow us to exculpate, indemnify and insure our executive officers and directors to the maximum extent permitted by Israeli law, subject to certain limitations set forth therein.
In addition, our compensation policy contains compensation recovery provisions which allow us under certain conditions to recover bonuses paid in excess, enable our chief executive officer to approve an immaterial change in the terms of employment of an executive officer who reports directly to him (provided that the changes of the terms of employment are in accordance with our compensation policy) and allow us to exculpate, indemnify and insure our executive officers and directors to the maximum extent permitted by Israeli law, subject to certain limitations set forth therein.
During the year ended December 31, 2022, our directors and officers were granted options to purchase an aggregate of 424,968 ordinary shares, at a weighted average exercise price of $60.17 per share, and 95,430 restricted share units under our 2019 Share Incentive Plan, or the 2019 Plan.
During the year ended December 31, 2023, our directors and officers were granted options to purchase an aggregate of 315,660 ordinary shares, at a weighted average exercise price of $36.77 per share, and 357,268 restricted share units under our 2019 Share Incentive Plan, or the 2019 Plan.
Annual Grant – Each Eligible Director shall be granted options with a grant date value of $300,000 upon the annual anniversary of his or her initial election or appointment (provided that the director is still in office) , or the Eligibility Date.
The commencement of the vesting shall begin on the election or appointment day. 71 Annual Grant – Each Eligible Director shall be granted restricted share units with a grant date value of $225,000 upon each annual anniversary of his or her initial election or appointment (provided that the director is still in office), or the Eligibility Date.
As of December 31, 2022, a total of 1,584,706 options to purchase ordinary shares were outstanding under the 2011 Plan, with a weighted average exercise price of $9.32 per share.
As of December 31, 2023, a total of 1,241,824 options to purchase ordinary shares were outstanding under the 2011 Plan, with a weighted average exercise price of $10.08 per share.
We pay each of our non-employee directors who (i) either joined our board of directors following our initial public offering or otherwise will join our board of directors in the future, or (ii) serves or will serve in the future on a board of directors committee, each (i) and (ii) an Eligible Director, the following compensation: 61 Cash Compensation An annual cash retainer with respect to each twelve months of service in an amount of: Lead Independent Director or Chairperson Member Board of Directors $ 97,500 $ 65,000 Additional fees with respect to each twelve months of service on the board of directors’ committees in the amounts of: Lead Independent Director or Chairperson Member Audit Committee $ 20,000 $ 8,000 Compensation Committee $ 10,000 $ 5,000 Nominating and Governance Committee $ 7,500 $ 4,500 Other Committee as Authorized by the Board of Directors $ 7,500 $ 4,500 Payment to the committee chairpersons is in lieu of (and not in addition) to the payments granted for committee membership.
We pay each of our non-employee directors who (i) either joined our board of directors following our initial public offering or otherwise will join our board of directors in the future, or (ii) serves or will serve in the future on a board of directors committee, each (i) and (ii) an Eligible Director, the following compensation (which reflects certain changes approved by our board of directors and shareholders on October 25, 2023 reducing the overall non-executive director compensation package and changing the form of equity awards granted thereunder from options to restricted share units): Cash Compensation An annual cash retainer with respect to each twelve months of service in an amount of: Lead Independent Director or Chairperson Member Board of Directors $ 50,000 $ 35,000 Additional fees with respect to each twelve months of service on the board of directors’ committees in the amounts of: Lead Independent Director or Chairperson Member Audit Committee $ 20,000 $ 10,000 Compensation Committee $ 15,000 $ 7,500 Nominating and ESG Committee $ 8,000 $ 4,000 Other Committee as Authorized by the Board of Directors $ 8,000 $ 4,000 Payment to the committee chairpersons is in lieu of (and not in addition) to the payments granted for committee membership.
Ms. Sharon Steiner, Chief Human Resources Officer. Compensation expenses recorded in 2022 of $275 in salary expenses and $93 in social benefits costs.
Compensation expenses recorded in 2023 of $311 in salary expenses and $114 in social benefits costs. Ms. Sharon Steiner, Chief Human Resources Officer. Compensation expenses recorded in 2023 of $267 in salary expenses and $92 in social benefits costs.
However, under regulations promulgated under the Companies Law, the insurance of office holders shall not require shareholder approval and may be approved by only the compensation committee, if the engagement terms are determined in accordance with the company’s compensation policy, that compensation policy was approved by the shareholders by the same special majority required to approve a compensation policy, provided that the insurance policy is on market terms and the insurance policy is not likely to materially impact the company’s profitability, assets or obligations.
However, under regulations promulgated under the Companies Law, the insurance of office holders shall not require shareholder approval and may be approved by only the compensation committee, if the engagement terms are determined in accordance with the company’s compensation policy, that compensation policy was approved by the shareholders by the same special majority required to approve a compensation policy, provided that the insurance policy is on market terms and the insurance policy is not likely to materially impact the company’s profitability, assets or obligations. 82 Our amended and restated articles of association allow us to indemnify and insure our office holders for any liability imposed on them as a consequence of an act (including any omission) which was performed by virtue of being an office holder.
As of December 31, 2022, options to purchase 2,933,654 ordinary shares granted to our executive officers and directors under our 2019 Plan and our 2011 Share Option Plan, or the 2011 Plan, at a weighted average exercise price of $45.11, and 209,833 restricted share units granted under the 2019 Plan, were outstanding.
As of December 31, 2023, options to purchase 3,462,853 ordinary shares granted to our executive officers and directors under our 2019 Plan and our 2011 Share Option Plan, or the 2011 Plan, at a weighted average exercise price of $43.27, and 353,562 restricted share units granted under the 2019 Plan, were outstanding.
Arnon was Senior Vice President of Marketing and Operations at SimilarWeb Ltd., a web analytics company. Prior to that, she served in multiple vice president roles at 888 Holdings Plc, an online gaming platform and publicly traded company in London, from 2009 to 2014. Ms. Arnon holds a B.A. and M.B.A. from Tel Aviv University in Israel.
Prior to that, she served in multiple vice president roles at 888 Holdings Plc, an online gaming platform and publicly traded company in London, from 2009 to 2014. Ms. Arnon holds a B.A. and M.B.A. from Tel Aviv University in Israel. Matti Yahav has served as our Chief Marketing Officer since November 2023.
Shraon Steiner of $9,238, $6,283, $3,347, $2,338 and $1,932, respectively. The relevant amounts underlying the equity awards granted to our officers during 2022, will continue to be expensed in our financial statements over a four-year period during the years 2023-2026 on account of the 2022 grants in similar annualized amounts.
Gali Arnon and Ms. Sharon Steiner of $9,713, $6,694, $3,328, $2,920 and $2,269, respectively. The relevant amounts underlying the equity awards granted to our officers during 2023, will continue to be expensed in our financial statements over a four-year period during the years 2024-2027 on account of the 2023 grants in similar annualized amounts.
If a company that initially offers its securities to the public, like us, adopts a compensation policy in advance of its initial public offering, and describes it in its prospectus for such offering, as we did, then such compensation policy shall be deemed a validly adopted policy in accordance with the Companies Law requirements described above.
Under special circumstances, the board of directors may approve the compensation policy despite the objection of the shareholders on the condition that the compensation committee and then the board of directors decide, on the basis of detailed grounds and after discussing again the compensation policy, that approval of the compensation policy, despite the objection of shareholders, is for the benefit of the company. 77 If a company that initially offers its securities to the public, like us, adopts a compensation policy in advance of its initial public offering, and describes it in its prospectus for such offering, as we did, then such compensation policy shall be deemed a validly adopted policy in accordance with the Companies Law requirements described above.
On the other hand, our compensation policy includes measures designed to reduce the executive officer’s incentives to take excessive risks that may harm us in the long-term, such as limits on the value of cash bonuses and equity-based compensation, limitations on the ratio between the variable and the total compensation of an executive officer and minimum vesting periods for equity-based compensation.
On the other hand, our compensation policy includes measures designed to reduce the executive officer’s incentives to take excessive risks that may harm us in the long-term, such as limits on the value of cash bonuses and equity-based compensation, limitations on the ratio between the variable and the total compensation of an executive officer and minimum vesting periods for equity-based compensation. 78 Our compensation policy also addresses our executive officers’ individual characteristics (such as his or her respective position, education, scope of responsibilities and contribution to the attainment of our goals) as the basis for compensation variation among our executive officers and considers the internal ratios between compensation of our executive officers and directors and other employees.
Fisher currently serves as a member of the board of directors of several Bessemer Venture Partners portfolio companies and previously served on the board of directors of Wix.com Ltd. from 2007 to 2016. Mr. Fisher holds a B.S.F.S. from Georgetown University.
From 1998 to 2007, Mr. Fisher was a Partner at Jerusalem Venture Partners, a venture capital firm based in Israel. Mr. Fisher currently serves as a member of the board of directors of several Bessemer Venture Partners portfolio companies and previously served on the board of directors of Wix.com Ltd. from 2007 to 2016. Mr.
Gutler served as the Chairperson of G.J.E. 121 Promoting Investments Ltd., a real estate company. Mr. Gutler is a former Managing Director and Partner of Bankers Trust Company, which is currently part of Deutsche Bank. Mr. Gutler currently serves on the board of directors of Wix.com Ltd., CyberArk Software Ltd., Walkme Ltd. and several private companies. Mr.
Gutler is a former Managing Director and Partner of Bankers Trust Company, which is currently part of Deutsche Bank. Mr. Gutler currently serves on the board of directors of Wix.com Ltd., CyberArk Software Ltd., Walkme Ltd. and several private companies. Mr. Gutler holds a B.A. and an M.B.A. from the Hebrew University of Jerusalem.
Our compensation policy provides for executive officer compensation in the form of share options or other equity-based awards, such as restricted shares and restricted share units, in accordance with our share incentive plan then in place. All equity-based incentives granted to executive officers shall be subject to vesting periods in order to promote long-term retention of the awarded executive officers.
Our compensation policy provides for executive officer compensation in the form of share options or other equity-based awards, such as restricted shares, restricted share units and performance stock units, in accordance with our share incentive plan then in place.
Zohar has served as President of Wix.com Ltd. since 2013 and as Chief Operating Officer of Wix.com Ltd. since 2008. Prior to that, Mr. Zohar served as the Budget and Production Manager of M.B. Contact Ltd., a private Israeli event production company, between 2005 and 2007. B. Compensation Compensation of directors and executive officers Directors.
Nir Zohar has served as a member of our board of directors since January 2014. Mr. Zohar has served as President of Wix.com Ltd. since 2013 and as Chief Operating Officer of Wix.com Ltd. since 2008. Prior to that, Mr. Zohar served as the Budget and Production Manager of M.B.
As of December 31, 2022, a total of 1,511,508 options to purchase ordinary shares, with a weighted average exercise price of $97.86 per share and 1,136,128 restricted share units were outstanding under the 2019 Plan. As of December 31, 2022, 3,551,789 ordinary shares were available for future issuance under the 2019 Plan.
As of December 31, 2023, a total of 2,170,457 options to purchase ordinary shares, with a weighted average exercise price of $76.89 per share and 1,476,818 restricted share units were outstanding under the 2019 Plan. As of December 31, 2023, 1,737,003 ordinary shares were available for future issuance under the 2019 Plan.
Such a welcome grant will vest on a quarterly basis over a period of one year. The commencement of the vesting shall begin on the election or appointment day.
Such welcome grant will vest on a quarterly basis over a period of one year.
Gali Arnon has served as our Chief Marketing Officer since October 2017. Prior to joining us, Ms. Arnon served as Chief Executive Officer of Brightcom Group Ltd, a digital marketing and publicly traded company in India, from 2015 to 2017. Between 2014 and 2015, Ms.
Arnon served as Chief Executive Officer of Brightcom Group Ltd, a digital marketing and publicly traded company in India, from 2015 to 2017. Between 2014 and 2015, Ms. Arnon was Senior Vice President of Marketing and Operations at SimilarWeb Ltd., a web analytics company.
Fisher has served as a Partner at Bessemer Venture Partners, a venture capital firm, and he is the founder of the firm’s investment practice in Tel Aviv, Israel. From 1998 to 2007, Mr. Fisher was a Partner at Jerusalem Venture Partners, a venture capital firm based in Israel. Mr.
Ms. Steiner holds a B.A. from Haifa University in Israel. Directors Adam Fisher has served as a member of our board of directors since January 2011. Since 2007, Mr. Fisher has served as a Partner at Bessemer Venture Partners, a venture capital firm, and he is the founder of the firm’s investment practice in Tel Aviv, Israel.
Employee Share Purchase Plan In August 2020, we adopted our 2020 Employee Share Purchase Plan, or the ESPP, to enable eligible employees of the company and certain of its designated subsidiaries to use payroll deductions to purchase the company’s ordinary shares and thereby acquire an ownership interest in the Company.
Options granted under the 2019 Plan to our employees who are U.S. residents may qualify as “incentive stock options” within the meaning of Section 422 of the Code, or may be non-qualified stock options. 72 Employee Share Purchase Plan In August 2020, we adopted our 2020 Employee Share Purchase Plan, or the ESPP, to enable eligible employees of the company and certain of its designated subsidiaries to use payroll deductions to purchase the company’s ordinary shares and thereby acquire an ownership interest in the Company.
Ron Gutler has served as a member of our board of directors since April 2019 and as a Lead Independent Director since May 2021. From May 2002 through February 2013, Mr. Gutler served as the Chairperson of NICE Systems Ltd., a public company specializing in voice recognition, data security and surveillance. Between 2000 and 2011, Mr.
From May 2002 through February 2013, Mr. Gutler served as the Chairperson of NICE Systems Ltd., a public company specializing in voice recognition, data security and surveillance. Between 2000 and 2011, Mr. Gutler served as the Chairperson of G.J.E. 121 Promoting Investments Ltd., a real estate company. Mr.
Our non-employee service providers and controlling shareholders may only be granted options under section 3(i) of the Ordinance, which does not provide for similar tax benefits. Options granted under the 2019 Plan to our employees who are U.S. residents may qualify as “incentive stock options” within the meaning of Section 422 of the Code, or may be non-qualified stock options.
Our non-employee service providers and controlling shareholders may only be granted options under section 3(i) of the Ordinance, which does not provide for similar tax benefits.
Set forth below is a chart showing the number of people we employed at the times indicated: As of December 31, 2022 (*) 2021 (*) 2020 (*) Total Employees 739 787 545 Located in Israel 575 580 426 Located in the United States 157 197 111 Located in Europe 7 10 8 In Research and Development 295 311 245 In Marketing 198 223 163 In General and Administration 125 109 70 In Customer Care 121 144 67 (*) The numbers of employees set forth in this table do not include contractors.
Set forth below is a chart showing the number of people we employed at the times indicated: As of December 31, 2023(*) 2022(*) 2021(*) Total Employees 775 739 787 Located in Israel 623 575 580 Located in the United States 144 157 197 Located in Europe 8 7 10 In Research and Development 332 295 311 In Marketing 204 198 223 In General and Administration 111 125 109 In Customer Care 128 121 144 (*) The numbers of employees set forth in this table do not include contractors. 83 In regard to our Israeli employees, Israeli labor laws govern the length of the workday, minimum wages for employees, procedures for hiring and dismissing employees, determination of severance pay, annual leave, sick days, advance notice of termination of employment, equal opportunity and anti-discrimination laws and other conditions of employment.
Gutler holds a B.A. and an M.B.A. from the Hebrew University of Jerusalem. Gili Iohan has served as a member of our board of directors since April 2019. Ms. Iohan is currently a Partner at ION Crossover Partners, an Israeli based cross-over fund. Ms.
Gili Iohan has served as a member of our board of directors since April 2019. Ms. Iohan is currently a Partner at ION Crossover Partners, an Israeli based cross-over fund. Ms. Iohan previously served as Chief Financial Officer of Varonis Systems, Inc., responsible for the company’s finance, accounting and back office operations, from 2005 to April 2017.
Compensation expenses recorded in 2022 of $365 in salary expenses and $99 in social benefits costs. Ms. Hila Klein, Chief Operating Officer. Compensation expenses recorded in 2022 of $359 in salary expenses and $122 in social benefits costs. Ms. Gali Arnon, Chief Marketing Officer. Compensation expenses recorded in 2022 of $319 in salary expenses and $105 in social benefits costs.
Compensation expenses recorded in 2023 of $368 in salary expenses and $98 in social benefits costs. Ms. Hila Klein, Chief Operating Officer. Compensation expenses recorded in 2023 of $350 in salary expenses and $118 in social benefits costs. Ms. Gali Arnon, Chief Business Officer, Marketplace.
Kolber also currently serves as a member of the board of directors of Viola Growth portfolio companies and several other private companies. Mr. Kolber holds a B.A. from Harvard University. Nir Zohar has served as a member of our board of directors since January 2014. Mr.
Prior to that, he served as Chief Executive Officer of Koor Industries Ltd., an industrial holding company, from 1998 to 2006. Mr. Kolber also currently serves as a member of the board of directors of Viola Growth portfolio companies and several other private companies. Mr. Kolber holds a B.A. from Harvard University.
Iohan currently serves on the board of directors of Varonis Systems, Inc., Monday.com Ltd. and Similarweb Ltd. Ms. Iohan holds a B.A. and an M.B.A. from Tel Aviv University in Israel. 59 Jonathan Kolber has served as a member of our board of directors since June 2019. Mr.
Prior to that, she was a Partner for six years at Nextage Ltd., a financial services advisory firm. Ms. Iohan currently serves on the board of directors of Varonis Systems, Inc., Monday.com Ltd. and Similarweb Ltd. Ms. Iohan holds a B.A. and an M.B.A. from Tel Aviv University in Israel.
Our compensation committee consists of Ron Gutler, Gili Iohan and Nir Zohar. Mr. Gutler serves as chairperson of the compensation committee. Our board of directors has determined that each member of our compensation committee is independent under the New York Stock Exchange rules, including the additional independence requirements applicable to the members of a compensation committee.
Our compensation committee consists of Ron Gutler, Gili Iohan and Nir Zohar. Mr. Gutler serves as chairperson of the compensation committee.
Our amended and restated articles of association include such a provision.
Our amended and restated articles of association include such a provision. An Israeli company may not exculpate a director from liability arising out of a prohibited dividend or distribution to shareholders.
Removed
Ms. Steiner holds a B.A. from Haifa University in Israel. During November 2022, Gil Shienfeld , our former Chief Technology Officer, parted with the Company. Directors Philippe Botteri has served as a member of our board of directors since January 2016. Since 2011, Mr.
Added
Klein holds a BS.c in Industrial Engineering from the Technion — Israel Institute of Technology. Gali Arnon has served as our Chief Business Officer since November 2023. Prior to that she was our Chief Marketing Officer since October 2017. Prior to joining us, Ms.
Removed
Botteri has served in various senior roles and as a Partner at Accel, a venture capital firm, where he focuses on investments in early stage technology companies, including cloud applications, enterprise security and online marketplaces. Prior to joining Accel, Mr. Botteri was at Bessemer Venture Partners, a global venture firm based in Silicon Valley. Mr.
Added
Matti brings with him over 20 years of marketing experience to Fiverr. He has worked with some of the world’s most recognizable brands, including Lego, Disney, Nestle, and SodaStream. During his time at SodaStream (NASDAQ: PEP), Matti spent over seven years on the Global Management Team, five of which were as CMO.
Removed
Botteri currently holds directorship and management positions for several Accel entities and other private companies, including UiPath, Inc. Mr. Botteri holds a M.A in engineering from Ecole Polytechnique and Ecole des Mines in France. Adam Fisher has served as a member of our board of directors since January 2011. Since 2007, Mr.
Added
Fisher holds a B.S.F.S. from Georgetown University. Yael Garten has served as a member of our board of directors since October 2023. She brings extensive experience in data science, machine learning, and converting data into actionable product and business strategy.
Removed
Iohan previously served as Chief Financial Officer of Varonis Systems, Inc., responsible for the company’s finance, accounting and back office operations, from 2005 to April 2017. Prior to that, she was a Partner for six years at Nextage Ltd., a financial services advisory firm. Ms.
Added
She serves on the Levi Strauss & Co. board of directors since 2020 and is a member of its audit committee and nominating, governance and corporate citizenship committee. Dr. Garten was the AI/ML Director of Data Science and Engineering at Apple from 2017 to 2023.
Removed
Kolber currently serves as a Partner and Senior Advisor at Viola Growth, a technology growth capital fund, where he previously served as a General Partner from 2008 to September 2018. Prior to that, he served as Chief Executive Officer of Koor Industries Ltd., an industrial holding company, from 1998 to 2006. Mr.
Added
Prior to that, from 2011 to 2017 she worked in a number of positions at LinkedIn Corporation and most recently was Director of Data Science from 2015 until 2017. Before joining LinkedIn, Dr. Garten was a Research Scientist and Text Mining Lead at the Stanford University School of Medicine.
Removed
The exercise price for the options shall be the average closing price per ordinary share on the NYSE over the thirty (30) trading days preceding the grant date, but, with respect to U.S. taxpayers, not less than the fair market value on the grant date for purposes of Section 409A of the United States Internal Revenue Code of 1986, as amended , or the Code .
Added
She holds a PhD in Biomedical Informatics from the Stanford University School of Medicine, an M.Sc. in Bioinformatics from the Weizmann Institute of Science, Israel, and a B.Sc. in Computational Biology from Bar-Ilan University, Israel. Ron Gutler has served as a member of our board of directors since April 2019 and as a Lead Independent Director since May 2021.
Removed
The exercise price for the option awards shall be the average closing sale price per ordinary share on the NYSE over the thirty (30) trading days preceding the grant date, but, with respect to U.S. taxpayers, not less than the fair market value on the date of grant for purposes of Section 409A of the Code.
Added
Jonathan Kolber has served as a member of our board of directors since June 2019. Mr. Kolber currently serves as a Chairman of ION Asset Management and Chairman and CEO of Anfield Ltd., his family owned investment company. From 2007 until 2021, Mr. Kolber served as a General Partner at Viola Growth, a technology growth capital fund.
Removed
Under special circumstances, the board of directors may approve the compensation policy despite the objection of the shareholders on the condition that the compensation committee and then the board of directors decide, on the basis of detailed grounds and after discussing again the compensation policy, that approval of the compensation policy, despite the objection of shareholders, is for the benefit of the company.

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Item 7. Management's Discussion & Analysis

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

13 edited+1 added−2 removed6 unchanged
Biggest change“Major Shareholders and Related Party Transactions—Certain relationships and related party transactions.” Name of beneficial owner Number % Principal Shareholders The Goldman Sachs Group, Inc.(1) 2,887,616 7.6 % Directors and Executive Officers Micha Kaufman (2) 2,570,545 6.7 % Ofer Katz * * Hila Klein * * Gali Arnon * * Sharon Steiner * * Philippe Botteri * * Adam Fisher * * Ron Gutler * * Gili Iohan * * Jonathan Kolber (3) 2,933,612 7.8 % Nir Zohar * * All executive officers and directors as a group (11 persons) 6,375,891 16.3 % * less than 1% (1) Based on information reported on a Schedule 13G filed on February 10, 2023, The Goldman Sachs Group, Inc. and Goldman Sachs & Co.
Biggest changeUnless otherwise noted below, each shareholder’s address is 8 Eliezer Kaplan St., Tel Aviv 6473409, Israel. 84 A description of any material relationship that our principal shareholders have had with us or any of our affiliates since January 1, 2023 is included under Item 7.B. ”Major Shareholders and Related Party Transactions—Certain relationships and related party transactions.” Name of beneficial owner Number % Directors and Executive Officers Micha Kaufman ( 1 ) 2,757,392 7.0 % Ofer Katz ( 2 ) 445,598 1.1 % Hila Klein * * Gali Arnon * * Matti Yahav * * Sharon Steiner * * Adam Fisher * * Yael Garten * * Ron Gutler * * Gili Iohan * * Jonathan Kolber ( 3 ) 2,933,612 7.6 % Nir Zohar * * All executive officers and directors as a group (12 persons) 6,827,217 16.9 % * less than 1% (1) Based on information available to us, Mr.
For purposes of the table below, we deem shares subject to options that are currently exercisable or exercisable within 60 days of March 1, 2023, and restricted share units that shall vest within 60 days of March 1, 2023, to be outstanding and to be beneficially owned by the person holding the options or restricted share units for the purposes of computing the percentage ownership of that person but we do not treat them as outstanding for the purpose of computing the percentage ownership of any other person.
For purposes of the table below, we deem shares subject to options that are currently exercisable or exercisable within 60 days of February 1, 2024, and restricted share units that shall vest within 60 days of February 1, 2024, to be outstanding and to be beneficially owned by the person holding the options or restricted share units for the purposes of computing the percentage ownership of that person but we do not treat them as outstanding for the purpose of computing the percentage ownership of any other person.
Major Shareholders The following table sets forth information with respect to the beneficial ownership of our shares as of March 1, 2023, by: • each person or entity known by us to own beneficially more than 5% of our outstanding shares; • each of our directors and executive officers individually; and • all of our executive officers and directors as a group.
Major Shareholders The following table sets forth information with respect to the beneficial ownership of our shares as of February 1, 2024, by: • each person or entity known by us to own beneficially more than 5% of our outstanding shares; • each of our directors and executive officers individually; and • all of our executive officers and directors as a group.
(3) Based on information reported on a Schedule 13G/A filed on January 11, 2021 and information available to us, represents (a) 809,835 ordinary shares held by Mr. Kolber directly, (b) 1,939,665 ordinary shares held by Anfield Ltd., over which Mr.
(3) Based on information reported on a Schedule 13G/A filed on January 11, 2021 and information available to us, Mr. Kolber’s holdings represent (a) 809,835 ordinary shares held by Mr. Kolber directly, (b) 1,939,665 ordinary shares held by Anfield Ltd., over which Mr.
See Item 6.C. ”Directors, Senior Management and Employees—Board Practices—Exculpation, insurance and indemnification of office holders.” C. Interests of Experts and Counsel Not applicable.
See Item 6.C. ”Directors, Senior Management and Employees—Board Practices—Exculpation, insurance and indemnification of office holders.” C. Interests of Experts and Counsel None.
As of March 1, 2023, we had 77,430 ordinary shares held by 16 U.S. resident shareholders of record, not including ​​Cede & Co., the nominee of The Depository Trust Company. B.
As of February 1, 2024, we had 77,507 ordinary shares held by 14 U.S. resident shareholders of record, not including ​​Cede & Co., the nominee of The Depository Trust Company. B.
The following is a description of our related party transactions, as defined under Item 7.B of Form 20-F, since January 1, 2022. Agreements with directors and officers Employment agreements. We entered into employment agreements with each of our executive officers in connection with our IPO.
The following is a description of our related party transactions, as defined under Item 7.B of Form 20-F, since January 1, 2023. Agreements with directors and officers Employment agreements. We entered into employment agreements with each of our executive officers. The agreements provide for the terms of each individual’s employment or service with the Company, as applicable.
Kolber has sole voting power, and (c) 184,112 ordinary shares held by Artemis Asset Holding Limited, on behalf of the Jonathan Kolber Bare Trust, of which Mr. Kolber is the sole beneficiary. Mr. Kolber may be deemed to have beneficial ownership of all of these ordinary shares, and his business address is 12 Abba Even Blvd, Herzliya, Israel 4672530.
Kolber has sole voting power, and (c) 184,112 ordinary shares held by Artemis Asset Holding Limited, on behalf of the Jonathan Kolber Bare Trust, of which Mr. Kolber is the sole beneficiary. Mr.
Kaufman holds 1,814,460 ordinary shares directly and 756,085 ordinary shares underlying options that are currently exercisable within 60 days of March 1, 2023, at a weighted-average exercise price of $49.40, which expire between 2025 and 2029.
Kaufman holds 1,814,460 ordinary shares directly and 942,932 ordinary shares underlying options that are currently exercisable within 60 days of February 1, 2024, at a weighted-average exercise price of $60.19, which expire between 2025 and 2030. (2) Based on information available to us, Mr.
To our knowledge, other than as disclosed in the table above, our other filings with the SEC and this Annual Report, there has been no significant change in the percentage ownership held by any major shareholder since January 1, 2020.
Kolber may be deemed to have beneficial ownership of all of these ordinary shares, and his business address is 12 Abba Even Blvd, Herzliya, Israel 4672530. 85 To our knowledge, other than as disclosed in the table above, our other filings with the SEC and this Annual Report, there has been no significant change in the percentage ownership held by any major shareholder since January 1, 2021.
We describe our share option plans under Item 6. “Directors, Senior Management and Employees - B. Compensation.” Exculpation, indemnification and insurance . Our amended and restated articles of association permit us to exculpate, indemnify and insure our office holders to the fullest extent permitted by the Companies Law.
Our amended and restated articles of association permit us to exculpate, indemnify and insure our office holders to the fullest extent permitted by the Companies Law.
The percentage of shares beneficially owned is based on 37,757,469 ordinary shares outstanding as of March 1, 2023. All of our shareholders, including the shareholders listed below, have the same voting rights attached to their ordinary shares. Unless otherwise noted below, each shareholder’s address is 8 Eliezer Kaplan St., Tel Aviv 6473409, Israel.
The percentage of shares beneficially owned is based on 38,702,103 ordinary shares outstanding as of February 1, 2024. All of our shareholders, including the shareholders listed below, have the same voting rights attached to their ordinary shares.
The agreements provide for the terms of each individual’s employment or service with the Company, as applicable. Options and restricted share units . Since our inception, we have granted options to purchase our ordinary shares and restricted share units to our executive officers and granted options to purchase our ordinary shares to certain of our directors.
Options and restricted share units . Since our inception, we have granted options to purchase our ordinary shares and restricted share units to our executive officers and granted options to purchase our ordinary shares to certain of our directors. We describe our share option plans under Item 6.B. ”Directors, Senior Management and Employees—Compensation—Share Option Plans.” Exculpation, indemnification and insurance .
Removed
A description of any material relationship that our principal shareholders have had with us or any of our affiliates since January 1, 2022 is included under Item 7.B.
Added
Katz holds 232,278 ordinary shares directly, 204,541 ordinary shares underlying options that are currently exercisable within 60 days of February 1, 2024, at a weighted-average exercise price of $72.63, which expire between 2027 and 2030, and 8,779 restricted share units that shall vest within 60 days of February 1, 2024.
Removed
LLC have shared voting power over 2,886,776 ordinary shares and shared dispositive power over 2,887,239 ordinary shares. The address of The Goldman Sachs Group, Inc. and Goldman Sachs & Co. LLC is 200 West Street, New York, NY 10282. 74 (2) Based on information available to us, Mr.

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