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

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

+391 added−404 removedSource: 10-K (2025-03-13) vs 10-K (2024-03-13)

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

391 paragraphs added · 404 removed · 340 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

70 edited+14 added−12 removed18 unchanged
Biggest changeOur culture is underpinned by the Weave Way, which consists of five key values that define our company, our approach to people and ultimately guide all of our actions. Our employees are united by our mission and driven by our values: • Stay Hungry. We remain HUNGRY and are never satisfied with the status quo.
Biggest changeWe reinforce these values by promoting an inclusive culture through training, sponsoring people resource groups open to all employees, and community involvement. Our culture is underpinned by the Weave Way, which consists of five key values that define our company, our approach to people and ultimately guide all of our actions.
Our Platform Weave helps SMB healthcare practices manage essential patient interactions. We consolidate telephony, messaging, scheduling, payments, staff collaboration, digital forms, reviews, and email marketing into one simple, easy and elegant solution. We allow practitioners to facilitate and manage patient interactions in a unified, modernized and personalized manner that best fits their patients’ needs and preferences.
Our Platform Weave helps SMB healthcare practices manage essential patient interactions. We consolidate telephony, messaging, scheduling, payments, staff collaboration, digital forms, reviews, and email marketing into one simple, easy and elegant solution. We allow practitioners and their staff to facilitate and manage patient interactions in a unified, modernized and personalized manner that best fits their patients’ needs and preferences.
Weave Insurance Verification helps office staff spend more time creating an exceptional patient experience and less time calling insurers to verify patient coverage details. Within the Weave platform, users can get up-to-date and accurate insurance plan details, all with a click of a button.
Insurance Verification helps office staff spend more time creating an exceptional patient experience and less time calling insurers to verify patient coverage details. Within the Weave platform, users can get up-to-date and accurate insurance plan details, all with a click of a button.
In many cases, our primary competition is the 13 combination of existing point solutions, such as messaging, phone service, marketing tools, payments, CRM or PMS platforms, analytics and reviews management, that potential customers may already use to manage their practices and in which they have made significant investments.
In many cases, our primary competition is the combination of existing point solutions, such as messaging, phone service, marketing tools, payments, CRM or PMS platforms, analytics and reviews management, that potential customers may already use to manage their practices and in which they have made significant investments.
Item 1. Business Our Mission Our mission is to elevate the patient experience through a unified platform that improves business operations so healthcare professionals can focus on patient care and realize their dreams. Overview Weave is a leading all-in-one customer experience and payments software platform for small- and medium-sized (“SMB”) healthcare businesses.
Item 1. Business Our Mission Our mission is to elevate the patient experience through a unified platform that improves business operations so healthcare professionals can focus on patient care and realize their dreams. Overview Weave is a leading all-in-one customer experience and payments software platform for small and medium-sized healthcare businesses.
Globally, these regulations continue to be introduced and to change over time. Such regulations can impact our ability to offer services to various customer segments, and our cost to deliver our services. 15 Corporate Information We were organized in Delaware in September 2008 as Recall Solutions, LLC.
Globally, these regulations continue to be introduced and to change over time. Such regulations can impact our ability to offer services to various customer segments, and our cost to deliver our services. Corporate Information We were organized in Delaware in September 2008 as Recall Solutions, LLC.
Customers are able, and may be authorized under certain circumstances, to use our subscriptions to transmit, receive, and/or store personal information, including Protected Health Information or Personal Health Information.
Customers are able, and may be authorized under certain circumstances, to use our subscriptions to transmit, receive, and/or store personal information, including Protected Health Information (“PHI”).
We have democratized powerful communication and engagement capabilities previously only available to enterprises, made them intuitive and easy to use and put them in one place. Our verticalized software platform streamlines the day-to-day operations of running an SMB healthcare practice.
We have democratized powerful communication and engagement capabilities previously only available to enterprises, made them intuitive and easy to use and put them in one solution. Our verticalized software platform streamlines the day-to-day operations of running an SMB healthcare practice.
We make available free of charge, on or through our website via the Investor Relations section at https://investors.getweave.com/, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements, and any amendments to such reports or other information filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we file such material electronically or otherwise furnish it to the U.S.
We make available free of charge, on or through our website via the Investor Relations section at https://investors.getweave.com/, our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements, and any amendments to such reports or other information filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after we file such material electronically or otherwise furnish it to the the SEC.
Our platform also features cloud-based Softphones, which do everything Weave phones can do, without the need for traditional phone hardware. From anywhere in the United States or Canada with an internet connection, customers can easily add lines and operate phones including viewing patients on hold, call management (switching, transferring, merging), and call parking.
Our platform also features cloud-based Softphones, which do everything Weave phones can do, without the need for traditional phone hardware. From anywhere in the U.S. or Canada with an internet connection, customers can easily add lines and operate phones including viewing patients on hold, call management (switching, transferring, merging), and call parking.
Once the phones are powered on and connected to a network by our customer, we provide configuration and automatic updates through the cloud. Our system also provides unlimited local and long distance voice calling within the United States and Canada to the Public Switched Telephone Network in the United States and Canada via SIP Trunking interconnects from multiple providers.
Once the phones are powered on and connected to a network by our customer, we provide configuration and automatic updates through the cloud. Our system also provides unlimited local and long distance voice calling within the U.S. and Canada to the Public Switched Telephone Network in the U.S. and Canada via SIP Trunking interconnects from multiple providers.
We are also subject to E-911 surcharges (typically governed by localities and/or state departments of revenue). In Canada, our VoIP service subscriptions are regulated by the Canadian Radio-television and Telecommunications Commission (“CRTC”), which, among other things, imposes requirements like those in the United States related to the provision of E-911 services.
We are also subject to E-911 surcharges (typically governed by localities and/or state departments of revenue). In Canada, our VoIP service subscriptions are regulated by the Canadian Radio-television and Telecommunications Commission (“CRTC”), which, among other things, imposes requirements like those in the U.S. related to the provision of E-911 services.
The CPRA imposes obligations on qualifying for-profit companies, such as Weave, doing business in California, and substantially increases potential liability for such companies for failure to comply with data protection rules applicable to California residents.
In particular, California has enacted the CPRA. The CPRA imposes obligations on qualifying for-profit companies, such as Weave, doing business in California, and substantially increases potential liability for such companies for failure to comply with data protection rules applicable to California residents.
Our phone system leverages our cloud infrastructure providers to deliver multiple redundant regions and lowest latency routing to ensure superior voice quality on calls to and from the entire United States and Canada. We provide our customers with advanced business phones from a leading cloud-based communications hardware manufacturer.
Our phone system leverages our cloud infrastructure providers to deliver multiple redundant regions and lowest latency routing to ensure superior voice quality on calls to and from the entire U.S. and Canada. We provide our customers with advanced business phones from a leading cloud-based communications hardware manufacturer.
Information on or that can be accessed through our websites or these social media channels is not part of this Annual Report on Form 10-K and shall not be deemed incorporated by reference. The inclusion of our website addresses and social media channels are inactive textual references only. 16
Information on or that can be accessed through our websites or these social media channels is not part of this Annual Report on Form 10-K and shall not be deemed incorporated by reference. The inclusion of our website addresses and social media channels are inactive textual references only. 9 Table of Contents
Weave digital forms provide a secure, convenient, and modern way for healthcare practices to collect patient information before the patients arrive for an appointment — increasing staff efficiency, improving data accuracy, and saving money on paper costs. Online Scheduling.
Weave Digital Forms provide a secure, convenient, and modern way for healthcare practices to collect patient information before the patients arrive for an appointment — increasing staff efficiency, improving data accuracy, and saving money on paper costs. 3 Table of Contents Online Scheduling.
Regulatory treatment of communications services over the internet outside the United States varies from country to country, and may be more onerous than imposed on our subscriptions in the United States. Our regulatory obligations in foreign jurisdictions could have a material adverse effect on the use of our subscriptions in international locations.
Regulatory treatment of communications services over the internet outside the U.S. varies from country to country, and may be more onerous than imposed on our subscriptions in the U.S.. Our regulatory obligations in foreign jurisdictions could have a material adverse effect on the use of our subscriptions in international locations.
Weave’s scheduling product, when integrated with the healthcare practice’s system of record, allows patients to schedule appointments from the practice’s website, send automatic scheduling reminders via text message, and personalize each reminder for the patient. This functionality keeps schedules full, reduces no-shows, and fills schedules more efficiently. Insurance Verification.
When integrated with the healthcare practice’s system of record, Online Scheduling allows patients to request appointments from the practice’s website, send automatic scheduling reminders via text message, and personalize each reminder for the patient. This functionality keeps schedules full, reduces no-shows, and fills schedules more efficiently. Insurance Verification.
We converted into a Delaware corporation in October 2015 under the name Weave Communications, Inc. Our principal executive offices are located at 1331 W Powell Way, Lehi, Utah 84043 and our telephone number is +1 (888) 579-5668. Available Information We maintain a website at https://www.getweave.com.
We converted into a Delaware corporation in October 2015 under the name Weave Communications, Inc. Our principal executive offices are located at 1331 W Powell Way, Lehi, Utah 84043 and our telephone number is +1 (385) 331-4164. Available Information We maintain a website at https://www.getweave.com.
Our platform unifies phones, text messaging, 8 appointment scheduling, staff collaboration, email marketing, requesting reviews, collecting payments, and digitizing forms, all in one place. • High ROI . Our platform helps our customers attract new patients, reduce appointment cancellations, keep schedules full, increase treatment acceptance rates, and improve staff efficiency and effectiveness.
Our platform unifies phones, text messaging, appointment scheduling, staff collaboration, email marketing, requesting reviews, collecting payments, and digitizing forms, all in one solution. • High ROI . Our platform helps our customers attract new patients, reduce appointment cancellations, keep schedules full, increase treatment acceptance rates, reduce outstanding accounts receivable, and improve staff efficiency and effectiveness.
Securities and Exchange Commission (the “SEC”). References to website addresses in this report are intended to be inactive textual references only, and none of the information contained on our website is part of this report or incorporated in this report by reference.
References to website addresses in this report are intended to be inactive textual references only, and none of the information contained on our website is part of this report or incorporated in this report by reference.
We have a research and development presence in both the United States and India. 11 Our Technology Weave Software Platform Our platform is composed of microservices in a highly containerized environment, which allows for rapid scaling of resources to meet the demands of our customers.
We have a research and development presence in both the U.S. and India. Our Technology Weave Software Platform Our platform is composed of microservices in a highly containerized environment, which allows for rapid scaling of resources to meet the demands of our customers.
Regulatory In the United States, at the federal level, we are subject to regulation by the Federal Communications Commission (“FCC”) as a provider of Voice over Internet Protocol (“VoIP”) as well as state and local 14 regulations applicable to VoIP providers.
Regulatory In the U.S., at the federal level, we are subject to regulation by the Federal Communications Commission (“FCC”) as a provider of Voice over Internet Protocol (“VoIP”) as well as state and local regulations applicable to VoIP providers.
If a patient’s insurance information is unable to be verified, users can contact patients directly through Weave’s two-way text or phone system to get information fast. When combined with Weave’s Digital Forms solution, the new patient intake process is streamlined, saving staff time and reducing long phone calls with insurance companies. 10 Practice Analytics .
If a patient’s insurance information is unable to be verified, users can contact patients directly through text messaging to get information fast. When combined with Weave’s Digital Forms, the new patient intake process is streamlined, saving staff time and reducing long phone calls with insurance companies. Practice Analytics .
With Weave’s mobile app, offices can connect, collaborate, and stay on top of office operations from anywhere through an iPhone or Android device. With the mobile app, Weave customers can make and receive calls and send texts from an office number, check schedules, check payment status, request and receive payments, send reminders, and use team chat.
With Weave’s Mobile App, staff members can connect, collaborate, and stay on top of their operations from anywhere through an iPhone or Android device. With the Mobile App, Weave customers can make and receive calls and send text messages from an office number, check schedules, check payment status, request and receive payments, send reminders, and use Team Chat.
We set practitioners and their staff free to do what they do best: care for their patients. The key benefits of our platform include: • Easy to Use and Intuitive . SMBs typically do not have dedicated technology staff, so they need solutions that are easy to implement and manage. Our platform is designed to be simple and intuitive.
We enable practitioners and their staff to do what they do best: care for their patients. The key benefits of our platform include: • Easy to Use and Intuitive . SMB healthcare practices typically do not have dedicated technology staff, so they need solutions that are easy to implement and manage. Our platform is designed to be simple and intuitive.
Weave integrates with dozens of healthcare practice systems of record, including practice management systems (“PMS”), patient relationship management (“PRM”) platforms, electronic health record (“EHR”) systems, enterprise resource planning software, or other third-party applications.
Weave integrates with dozens of healthcare practice systems of record, including PMS, patient relationship management (“PRM”) platforms, electronic 1 Table of Contents health record (“EHR”) systems, enterprise resource planning software, or other third-party applications.
Customized Phone System. Weave provides a smarter phone system that helps practices identify whether incoming calls are from new or current patients, provides helpful and actionable information at every call, and manages heavy call times.
Weave provides a smarter phone system that helps practices identify whether incoming calls are from new or existing patients, provides helpful and actionable information at every call, and manages heavy call volumes.
We democratize enterprise-grade customer communications and engagement capabilities for SMBs, saving them time and allowing them to effectively and efficiently communicate with their patients. • Unified Communications and Engagement .
We democratize enterprise-grade customer communications and engagement capabilities, saving our customers time and allowing them to effectively and efficiently communicate with their patients. • Unified Communications and Engagement .
Additionally, we are subject to several laws in the United States and Canada that regulate communications between businesses and their customers/patients, and protect consumers from unwanted messages and telephone calls.
Additionally, we are subject to several laws in the U.S. and Canada that regulate communications between businesses and their customers or patients, and protect consumers from unwanted messages and telephone calls.
We use these channels to routinely communicate important information with investors and the public about our company, our products and services and other matters via our website (www.getweave.com), our newsroom (www.getweave.com/newsroom), LinkedIn (www.linkedin.com/company/weave-communications), Instagram (https://www.instagram.com/getweave/), Facebook (https://www.facebook.com/search/top?q=weave), TikTok (https://www.tiktok.com/@getweave), and X (https://twitter.com/getweave), and to comply with our disclosure obligations under Regulation Fair Disclosure.
We use these channels to routinely communicate important information with investors and the public about our company, our products and services and other matters via our website (www.getweave.com), our newsroom (www.getweave.com/newsroom), LinkedIn (www.linkedin.com/company/getweave), Instagram (https://www.instagram.com/getweave/), Facebook (https://www.facebook.com/weavecomm), and X (https://x.com/getweave), and to comply with our disclosure obligations under Regulation Fair Disclosure.
To the extent that our subscribers use our SMS texting, VoIP telephone, email marketing, and fax services, we provide features and functionality that enable our subscribers to manage their compliance with these customer protection laws.
To the extent that our subscribers use our text messaging, VoIP telephone, email marketing, and fax services, we provide features and functionality that enable our subscribers to manage their compliance with these consumer protection laws.
Our Customers As of December 31, 2023, we had more than 31,000 locations under subscription and more than 28,000 customers in the United States and Canada. These customers represent many healthcare industries with the majority being in dental, optometry, veterinary, and other medical specialty services. No one single customer represents more than 5% of our revenue.
Our Customers As of December 31, 2024, we had approximately 35,000 locations under subscription and more than 30,000 customers in the U.S. and Canada. These customers represent many healthcare industries with the majority being in dental, optometry, veterinary, and other medical specialty services. No one single customer represents more than 5% of our revenue.
Weave Phones show key patient information at the outset of each call, including the caller's name, upcoming appointment information, when they are due for an appointment, overdue balances, tasks, special notes, and follow-ups. Softphones. With Softphones from Weave, practices can make and receive calls from anywhere in the United States or Canada with an internet connection.
Key patient information is displayed at the outset of each call, including the caller's name, upcoming scheduled appointment information or when they are due for their next appointment, overdue balances, tasks, special notes, and follow-ups. Softphones. With Softphones from Weave, practices can make and receive calls from anywhere in the U.S. or Canada with an internet connection.
Under such agreements, our employees, consultants and contractors are subject to invention assignment provisions designed to protect our proprietary information and ensure our ownership of intellectual property developed pursuant to such agreements.
We also enter into confidentiality and intellectual property rights agreements with our employees, consultants and contractors. Under such agreements, our employees, consultants and contractors are subject to invention assignment provisions designed to protect our proprietary information and ensure our ownership of intellectual property developed pursuant to such agreements.
Our team members implement a robust suite of security policies and standards to execute processes, operations, and development in a secure manner consistent with industry standards, best practices and the NIST Cybersecurity Framework. At the physical and infrastructure layers, our platform and products are hosted on Google Cloud Platform (GCP).
Our team members implement a robust suite of security policies and standards to execute processes, operations, and development in a secure manner consistent with industry standards, best practices and the NIST Cybersecurity Framework. At the physical and infrastructure layers, our platform and products are hosted on GCP, which undergoes regular independent verification of its security, privacy, and compliance controls.
We continued expanding our presence abroad during 2023 by hiring additional engineers and support representatives in India. We offer competitive compensation and benefits packages and strive to promote the well-being of our employees and their families by offering generous parental and other leave policies as well as flexible paid time-off policies to accommodate individual circumstances.
We offer competitive compensation and benefits packages and strive to promote the well-being of our employees and their families by offering generous parental and other leave policies as well as flexible paid time-off policies to accommodate individual circumstances.
We believe we compete favorably based on the factors described above. Intellectual Property Our intellectual property is an important part of our business. We protect our intellectual property through a combination of domain names, copyright, trade secrets and trademarks, as well as through contractual provisions, our information security infrastructure and restrictions on access to or use of our proprietary technology.
We protect our intellectual property through a combination of domain names, copyright, trade secrets and trademarks, as well as through contractual provisions, our information security infrastructure and restrictions on access to or use of our proprietary technology.
Our teams strive to continuously deliver value to our customers, serving our broad customer base while also developing customized experiences and integrations to meet the specific needs of each healthcare SMB vertical we serve.
Research and Development Our engineering and product teams are responsible for the creation and development of high-value features and functionality across our platform. Our teams strive to continuously deliver value to our customers, serving our broad customer base while also developing customized experiences and integrations to meet the specific needs of each healthcare SMB vertical we serve.
At an organization-wide level, we have a dedicated security team with security compliance, security engineering, security operations, and application security expertise to influence the secure handling of customer data, and secure development and operation of our products.
Security We employ multiple layers of security to protect our systems, processes, buildings, proprietary data, customer data, and other assets. 5 Table of Contents At an organization-wide level, we have a dedicated security team with security compliance, security engineering, security operations, and application security expertise to influence the secure handling of customer data, and secure development and operation of our products.
Practices can send a broad array of communications ranging from personalized birthday messages and appointment reminders to requests to pay overdue balances. In addition, our Bulk Texting feature allows for mass communications from the practice phone number. Missed Call Text. With Missed Call Text, practices can take action in real time upon notification of a missed call.
Our two-way Text Messaging function allows practices to communicate with patients in a way that is easy, simple and accessible. Practices can send a broad array of communications ranging from personalized birthday messages and appointment reminders to requests to pay overdue balances. In addition, our Bulk Texting feature allows for mass communications from the practice phone number. Missed Call Text.
We treat this business as our own, and we hold ourselves and each other ACCOUNTABLE for the goals that we set. As owners, we focus on integrity and honesty in all of our interactions and strive to do the right thing for our people, our customers and our community every day.
As owners, we focus on integrity and honesty in all of our interactions and strive to do the right thing for our people, our customers and our community every day.
This results in increased patient loyalty and retention. • Improved Ability to Attract New Patients . Our platform helps practices attract new patients by collecting and managing online reviews, ensuring practices do not miss a call or text, and eliminating the friction typically associated with scheduling appointments and completing forms. • Personalized Communication and Payments .
Our platform helps practices attract new patients by collecting and managing online reviews, ensuring practices do not miss a call or text, and eliminating the friction typically associated with scheduling appointments and completing forms. • Personalized Communication and Payments . Our platform engages with patients in the manner that is easiest and most comfortable for them.
Weave Reviews and Response Assistant. Weave Reviews helps practices automatically request, collect, monitor, and respond to Google and Facebook reviews. Weave Reviews helps practices get discovered, rank higher in online searches, and grow their customer base. Weave’s Response Assistant uses generative AI technology to create custom, relevant responses to patient reviews to increase reputation management efficiency.
Weave Reviews helps practices get discovered, rank higher in online searches, and grow their customer base. Weave’s AI-powered Response Assistant uses generative AI technology to create custom, relevant responses to patient reviews to increase reputation management efficiency. Weave Email Marketing and Email Assistant. Weave Email Marketing makes it easy for anyone to create professional emails quickly.
The collection, use, processing, or disclosure of personal information may be subject to United States and Canadian federal, state and provincial regulations, including, but not limited to, the Health Insurance Portability and Accountability Act (“HIPAA”); the California Privacy Rights Act (“CPRA”) (California); US state data breach notification laws; and the Personal Information Protection and Electronic Documents Act (“PIPEDA”) (Canada).
The collection, use, processing, or disclosure of personal information may be subject to U.S. and Canadian federal, state and provincial regulations, including, but not limited to, the Health Insurance Portability and Accountability Act (“HIPAA”); the California Privacy Rights Act (“CPRA”) (California); US state data breach notification laws; and the Personal Information Protection and Electronic Documents Act (“PIPEDA”) (Canada). 8 Table of Contents In addition to these regulations, many states continue to consider enacting privacy legislation that may apply to companies such as Weave which collect, store, and process many types of data, including personal data.
If key team members are out of the office, the group messaging function allows them to stay in the know on everything going on at the office. Weave Mobile App . Practitioners and staff no longer need to be in the office to reach their team and their patients.
Even when key team members are out of the office, group messaging ensures they stay informed and engaged. Weave Mobile App . Practitioners and staff no longer need to be in the office to reach their team and their patients.
GCP undergoes regular independent verification of its security, privacy, and compliance controls At the data layer, data is encrypted in transit over public networks and at rest in our backend databases and object stores using industry-accepted encryption protocols (TLS 1.2 or higher; AES-256 or higher) with known strong ciphers.
At the data layer, data is encrypted in transit over public networks and at rest in our backend databases and object stores using industry-accepted encryption protocols (TLS 1.2 or higher; AES-256 or higher) with known strong ciphers. Customer images and call recordings are encrypted with unique encryption keys for each customer.
Staff members can work from home, on the road, or in different office locations without missing any calls. Softphones do everything Weave Phones can do, but they operate in the cloud and do not require dedicated telephone hardware. Text Messaging . Our two-way texting function allows practices to communicate with patients in a way that is easy, simple and accessible.
Staff members can work from home, on the road, or in different office locations without missing any calls. Softphones do everything Weave Phones can do, but they operate in the cloud and do not require dedicated telephone hardware. 2 Table of Contents Text Messaging .
Weave Practice Analytics provides real-time data on patient retention, appointment scheduling, treatment acceptance rates, and revenue generation. This information allows practices to identify areas of improvement and implement strategies to optimize their operations. Call Intelligence . With Weave Call Intelligence, every call becomes a source of valuable insights.
Practice Analytics provides real-time data on patient retention, appointment scheduling, treatment acceptance rates, and revenue generation. This information allows practices to identify areas of improvement and implement strategies to optimize their operations. Call Intelligence . Our AI-powered Call Intelligence product analyzes call recordings, providing deep insights without the need to manually review conversations.
Our teams use phone, online chat, email, web meetings, and in-person events to interact with our current and potential customers. In addition to our direct sales team and marketing teams, we have a business development team that finds, negotiates contracts and manages partner relationships. These partners include technology integration partners, key-opinion leaders, IT-installers, buying groups, affiliates, and distributors.
In addition, we have a sales team specifically focused on customer success and expanding usage within our existing customer base. In addition to our direct sales team and marketing teams, we have a business development team that finds, negotiates contracts and manages partner relationships. These partners include technology integration partners, key-opinion leaders, IT-installers, buying groups, affiliates, and distributors.
We demonstrate our commitment to the professional development of all Weave employees by offering professional and skill development resources and manager development courses/tracks. We also recognize that fostering a diverse and inclusive workforce makes us stronger as a company and is a key element of our employee recruitment, engagement and retention strategy.
We demonstrate our commitment to the professional development of all Weave employees by offering professional and skill development resources and manager development courses. We believe that fostering a diverse and inclusive workforce makes us stronger as a company. Our goal is to ensure equitable hiring, compensation, performance management, promotions and personal development processes.
This functionality gives practices the flexibility to respond when it is convenient for them, and enables multiple conversations at once. Billing and Payments.
Weave’s Text Connect enables practices to interact with their existing and potential patients online directly through their websites. This functionality gives practices the flexibility to respond when it is convenient for them, and enables multiple conversations at once. Weave Payments.
We have trademark applications for select marks in the United States and will pursue additional trademark applications to the extent we believe it will be beneficial. We also have registered domain names for the website that we use in our business.
We have trademark applications for select marks in the U.S. and will pursue additional trademark applications to the extent we believe it will be beneficial. We also have registered domain names for the website that we use in our business. Additionally, we rely upon unpatented trade secrets, confidential know-how and continuing technological innovation to develop and maintain our competitive position.
These partners refer customers to us on a commissioned basis. These referrals are then passed to the sales team to close. We also focus on growing our channel partnership programs to promote and sell our products directly through partners.
These partners refer customers to us on a commissioned basis. These referrals are then passed to the sales team to close.
We also have outsourced supplemental customer support operations in the Philippines. In addition, we maintain an extensive training and self-help content hub on our website. We also offer certifications to develop Weave experts within a practice. We strive to maintain an exceptional quality of service to promote retention and referrals.
All customer success, customer support, customer training and customer onboarding team members are currently located in the U.S., India, and the Philippines. In addition, we maintain an extensive training and self-help content hub on our website. We also offer certifications to develop Weave experts within a practice.
Missed Text Auto-Reply ensures prompt replies to patient text messages by automatically responding to messages received outside of a practice’s normal operating hours. 9 Team Chat . Weave provides a modern, secure group messaging solution that helps practitioners and their staff communicate with each other from their workstations, allowing for faster collaboration to respond to and delight patients.
Missed Text Auto-Reply ensures prompt replies to patient text messages by automatically responding to messages received outside of a practice’s normal operating hours. Team Chat . Weave offers a modern, secure group messaging solution that enables practitioners and staff to communicate seamlessly within the Weave App. This feature supports enhances collaboration, and keeps teams connected.
We know that true innovation happens when everyone has the opportunity to succeed and feels valued for their contributions. • Think Creatively. Getting CREATIVE can solve a lot of challenges. We know that great ideas can come from anyone at any time. We go out beyond our circle and get involved.
We value diversity of people and thought and strive to be kind and inclusive in all of our interactions. We know that true innovation happens when everyone has the opportunity to succeed and feels valued for their contributions. • Think Creatively. Getting CREATIVE can solve a lot of challenges.
CARING deeply about those around us—including our customers, our community, and each other—is just what we do. We believe everyone is important and should be treated with respect and courtesy. We value diversity of people and thought and strive to be kind and inclusive in all of our interactions.
We are always asking questions and always trying to improve, knowing that our failures keep us moving onward and upward. • Care More. CARING deeply about those around us—including our customers, our community, and each other—is just what we do. We believe everyone is important and should be treated with respect and courtesy.
From the first phone call to the final invoice, we connect the entire patient journey. Unified Phone Number. All communications from the Weave platform, including calls and texts, are sent from a single phone number. Patients can save this office number to their contacts, no personal cell phone numbers are used, and multiple team members can manage conversations.
All communications from the Weave platform, including calls and text messaging, are sent from a single phone number. Patients can save the office number to their contacts, and multiple team members can manage conversations seamlessly without relying on individual devices. Customized Phone System.
Weave also generates demand and sells directly to healthcare practices at trade shows and other industry events. Subscriptions are primarily sold through our direct inside sales team based in Lehi, Utah.
Weave also generates demand and sells directly to healthcare practices at trade shows and other industry events. Subscriptions are primarily sold through our direct inside sales team. Most of our sales teams are focused on attracting new customers and are trained to sell into multiple SMB healthcare verticals, organized by sales motion (inbound, outbound, upsell, and mid-market).
Customer images and call recordings are encrypted with unique 12 encryption keys for each customer. Encryption keys are stored only in memory by our services, and are encrypted on disk behind our key management system. Human Capital As of December 31, 2023, we had 844 employees.
Encryption keys are stored only in memory by our services, and are encrypted on disk behind our key management system. Human Capital As of December 31, 2024, we had 854 employees. We continued expanding our presence abroad during 2024 by hiring additional engineers and support representatives in India and engaging supplemental customer support and revenue operations in the Philippines.
From the first phone call to the final invoice, Weave connects the entire patient journey. Our solutions transform how local healthcare practitioners attract, communicate with and engage patients to grow their practice.
From the first phone call to the final invoice and every touchpoint in between, Weave connects the entire patient journey. Weave’s software solutions transform how healthcare practices attract, communicate with, and engage patients and clients to grow their business. Weave seamlessly integrates billing and payment requests into communication workflows, streamlining payment timelines, reducing accounts receivable, and supporting practice profitability.
We continuously monitor key customer service metrics such as phone hold time, ticket response time, ticket resolution rates, and customer satisfaction of our support interactions. Research and Development Our engineering and product teams are responsible for the creation and development of high-value features and functionality across our platform.
We strive to maintain an exceptional quality of service to promote retention and referrals. We continuously monitor key customer service metrics such as phone hold time, ticket response time, ticket resolution rates, and customer satisfaction of our support interactions.
We are constantly blazing new trails and innovating the very best solutions. We volunteer for the hard things, knowing that the only easy day was yesterday. We’re always asking questions and always trying to improve, knowing that our failures keep us moving onward and upward. • Care More.
Our employees are united by our mission and driven by our values: • Stay Hungry. We remain HUNGRY and are never satisfied with the status quo. We are constantly blazing new trails and innovating the very best solutions. We volunteer for the hard things, knowing that the only easy day was yesterday.
Immediately after missing a patient’s call, this feature sends a message to the patient asking how the healthcare practice’s office can help and enables practices to rapidly engage with their patients after hours or when otherwise unavailable by phone. Missed Text Auto-Reply.
Missed Call Text allows practices to respond instantly when a call is missed. This feature automatically sends a message asking how the office can assist, enabling quick patient engagement—even after hours or when staff are unavailable. Missed Text Auto-Reply.
We ask questions and we’re curious about the world around us, finding inspiration everywhere. We pay attention to the little things. We constantly endeavor to challenge the old to make things better. We are scrappy and resourceful, and we never settle for ordinary. • Do the Right Thing.
We know that great ideas can come from anyone at any time. We go out beyond our circle and get involved. We ask questions and we are curious about the world around us, finding inspiration everywhere. We pay 6 Table of Contents attention to the little things. We constantly endeavor to challenge the old to make things better.
Customer Success and Support We offer customer support via phone, online chat, and email to resolve technical and operational issues for our customers, if and when such issues arise. All customer success, customer support, customer training and customer onboarding team members are currently located in the United States, and India.
We also focus on growing our channel partnership programs to promote and sell our products directly through partners. 4 Table of Contents Customer Success and Support We offer customer support via phone, online chat, and email to resolve technical and operational issues for our customers, if and when such issues arise.
Weave provides more functionality at a significantly lower cost than the combined cost of point solutions. • Reduced Churn for Our Customers . Our platform helps our customers’ practices keep their patients engaged through multi-channel communications—phone, text messaging, or email, and reduces friction with online appointments, digital forms, and convenient payments.
Weave provides more functionality at a significantly lower cost than the combined cost of point solutions. • Reduced Churn for Our Customers .
Our platform spans all forms of communication and engagement including physical and softphones, messaging, email marketing, insurance verification, online appointment scheduling, reviews, payments, digital forms, and more. We bring practitioners and the patients they serve closer together by unifying, modernizing, and personalizing interactions. Our platform helps practitioners improve communications, attract and engage more patients, and increase patient retention.
Instead of a fragmented set of tools, Weave offers an AI-powered solution that spans all forms of communication and engagement including physical and softphones, messaging, email marketing, insurance verification, online appointment scheduling, reviews, payments, digital forms, and more.
Our platform engages with patients in the manner that is easiest and most comfortable for them. • Purpose-Built for SMB Healthcare Practices . Our platform is designed to address the specific needs of each industry vertical that we serve. Our Products Weave provides an all-in-one customer experience and payments software platform for SMB healthcare businesses.
Our Products Weave provides an all-in-one customer experience and payments software platform for SMB healthcare businesses. Our vision is to elevate the patient experience through a unified platform that improves business operations, enabling healthcare professionals to focus on patient care and achieve their dreams. Unified Phone Number.
Removed
Our platform enables healthcare practitioners to maximize the value of their patient interactions and minimize the time and effort spent on manual or mundane tasks by bringing multiple workflows together into a single software platform.
Added
Through authorized and supported integrations with leading practice management systems (“PMS”), we automate and personalize patient communications while embedding FinTech solutions—such as text-to-pay, online bill pay, and payment plans—directly into communication workflows. By streamlining payment processes, Weave accelerates collections, reduces write-offs, and improves practice profitability.
Removed
Weave Email Marketing and Email Assistant. Weave Email Marketing is built for non-experts to get up to speed quickly and send emails like the pros. Customers can choose from a library of pre-written email templates, and a library of free images, to start email marketing using Weave on Day 1.
Added
Our platform helps our customers’ practices keep their patients engaged through multi-channel communications—phone, text messaging, or email, and reduces friction with online appointments, digital forms, and convenient and flexible payment options, including text to pay, online bill pay, and payment plans. This results in increased patient loyalty and retention. • Improved Ability to Attract New Patients .
Removed
By simply inputting the themes that need to be covered in the email, Weave Email Assistant generates the email text in a matter of seconds, which can then be edited before sending.
Added
We integrate flexible payment options—including text to pay, buy-now-pay-later, and payment plans—directly into communication workflows. • Purpose-Built for SMB Healthcare Practices . Weave is designed to meet the unique needs of each healthcare specialty. Through authorized integrations with leading PMS, our platform optimizes specialized workflows and patient interactions.
Removed
This tool allows healthcare providers to quickly create, personalize, and automate email marketing campaigns that drive improved patient engagement and retention, a higher patient growth rate, and increased awareness of services offered by a practice. Text Connect . Weave’s Text Connect enables practices to interact with their existing and potential patients online directly through their websites.
Added
In veterinary practices, pets—not clients—take center stage, allowing staff to quickly access and manage pet-specific records. In optometry, custom notifications like "eyewear ready" enhance patient communication and pickup efficiency. For dental practices, Weave Insurance Verification simplifies billing and pre-appointment workflows, ensuring a smoother patient experience.
Removed
Weave Payments is a comprehensive payment processing solution for practices that offers multiple contactless payment options, allowing patients to pay the way they want, whether they are in the office or miles away, and whenever it is most convenient for them.
Added
Weave AI . Weave leverages more than a decade of patient interactions to train large language models and deliver AI-powered features that foster practice growth, enhance staff productivity, and improve patient experiences. Weave Reviews and Response Assistant. Weave Reviews helps practices automatically request, collect, monitor, and respond to Google and Facebook reviews.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeAny provision in our amended and restated certificate of incorporation, our amended and restated bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our common stock, and could also affect the price that some investors are willing to pay for our common stock.
Biggest changeAny provision in our amended and restated certificate of incorporation, our amended and restated bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our common stock, and could also affect the price that some investors are willing to pay for our common stock. 50 Table of Contents Our amended and restated certificate of incorporation designates the Court of Chancery of the State of Delaware and, to the extent enforceable, the federal district courts of the U.S. of America as the exclusive forums for certain disputes between us and our stockholders, which will restrict our stockholders’ ability to choose the judicial forum for disputes with us or our directors, officers, or employees.
If our quarterly results of operations or forward-looking quarterly and annual financial guidance fall below the expectations of investors or securities analysts, then the trading price of common stock could decline substantially.
If our quarterly results of operations or forward-looking quarterly and annual financial guidance fall below the expectations of investors or securities analysts, then the trading price of our common stock could decline substantially.
Any of these events or other outcomes may: • materially and adversely affect our business and results of operations; • result in the loss of a substantial number of existing customers or prohibit the acquisition of new customers; • cause us to pay license fees for intellectual property we are deemed to have infringed; • cause us to incur costs and devote valuable technical resources to redesigning our products or platform; • cause our cost of revenue to increase; • cause us to accelerate expenditures to preserve existing revenue; 49 • cause existing or new vendors to require pre-payments or letters of credit; • materially and adversely affect our brand in the marketplace and cause a substantial loss of goodwill; • cause us to change our business methods; • require us to cease certain business operations or offering certain products or features; and • lead to our bankruptcy or liquidation.
Any of these events or other outcomes may: • materially and adversely affect our business and results of operations; • result in the loss of a substantial number of existing customers or prohibit the acquisition of new customers; • cause us to pay license fees for intellectual property we are deemed to have infringed; • cause us to incur costs and devote valuable technical resources to redesigning our products or platform; • cause our cost of revenue to increase; • cause us to accelerate expenditures to preserve existing revenue; • cause existing or new vendors to require pre-payments or letters of credit; • materially and adversely affect our brand in the marketplace and cause a substantial loss of goodwill; • cause us to change our business methods; • require us to cease certain business operations or offering certain products or features; and • lead to our bankruptcy or liquidation.
For example, our business, financial condition and results of operations may be adversely affected if content or recommendations that AI solutions or features assist in producing are or are alleged to be deficient, inaccurate, or biased, or if 32 such content, recommendations, solutions, or features or their development or deployment (including the collection, use, or other processing of data used to train or create such AI solutions or features) are found to have or alleged to have infringed upon or misappropriated third-party intellectual property rights or violated applicable laws, regulations, or other actual or asserted legal obligations to which we are or may become subject.
For example, our business, financial condition and results of operations may be adversely affected if content or recommendations that AI solutions or features assist in producing are or are alleged to be deficient, inaccurate, or biased, or if such content, recommendations, solutions, or features or their development or deployment (including the collection, use, or other processing of data used to train or create such AI solutions or features) are found to have or alleged to have infringed upon or misappropriated third-party intellectual property rights or violated applicable laws, regulations, or other actual or asserted legal obligations to which we are or may become subject.
We process business and personal information of our customers and employees, which subjects us to HIPAA and other stringent and changing federal, state and foreign laws, regulations, industry standards, information security policies, self-regulatory schemes, contractual obligations, and other legal obligations related to data processing, protection, privacy, and security, and our actual or perceived failure to comply with such obligations could harm our 45 business, financial condition, results of operations, and prospects and could expose us to liability.
We process business and personal information of our customers and employees, which subjects us to HIPAA and other stringent and changing federal, state and foreign laws, regulations, industry standards, information security policies, self-regulatory schemes, contractual obligations, and other legal obligations related to data processing, protection, privacy, and security, and our actual or perceived failure to comply with such obligations could harm our business, financial condition, results of operations, and prospects and could expose us to liability.
While we improve our own technology and work closely with email service providers to maintain our deliverability rates, the implementation of new or more restrictive policies by email service providers may make it more difficult to deliver our customers’ emails, particularly if we are not given adequate notice of a change in policy or are unable to update our platform or products to comply with the changed policy in a reasonable amount of 36 time.
While we improve our own technology and work closely with email service providers to maintain our deliverability rates, the implementation of new or more restrictive policies by email service providers may make it more difficult to deliver our customers’ emails, particularly if we are not given adequate notice of a change in policy or are unable to update our platform or products to comply with the changed policy in a reasonable amount of time.
Our actual or perceived failure to comply with Data Protection Laws, Privacy Policies, and Data Protection Obligations could also subject us to litigation, claims, proceedings, actions, or investigations by governmental entities, authorities, or regulators that could require changes to our business practices, 47 diversion of resources and the attention of management from our business, regulatory oversights and audits, discontinuance of necessary processing, or other remedies that adversely affect our business.
Our actual or perceived failure to comply with Data Protection Laws, Privacy Policies, and Data Protection Obligations could also subject us to litigation, claims, proceedings, actions, or investigations by governmental entities, authorities, or regulators that could require changes to our business practices, diversion of resources and the attention of management from our business, regulatory oversights and audits, discontinuance of necessary processing, or other remedies that adversely affect our business.
If a significant 30 portion of our network service providers stop providing us with access to their infrastructure, fail to provide these services to us on a cost-effective basis, cease operations, or otherwise terminate these services, the delay caused by qualifying and switching to other network service providers could be time-consuming and costly and could adversely affect our business, results of operations and financial condition.
If a significant portion of our network service providers stop providing us with access to their infrastructure, fail to provide these services to us on a cost-effective basis, cease operations, or otherwise terminate these services, the delay caused by qualifying and switching to other network service providers could be time-consuming and costly and could adversely affect our business, results of operations and financial condition.
Although these systems do not currently offer the broad functionality provided by our platform or products, if the providers of these systems were to seek to integrate some or all of the 25 functionality offered by our platform or products in the future, either by building that functionality into their systems or through partnerships with third parties, existing or potential customers that use these systems may choose to use that functionality rather than to subscribe to our platform and products.
Although these systems do not currently offer the broad functionality provided by our platform or products, if the providers of these systems were to seek to integrate some or all of the functionality offered by our platform or products in the future, either by building that functionality into their systems or through partnerships with third parties, existing or potential customers that use these systems may choose to use that functionality rather than to subscribe to our platform and products.
The market price of our common stock has and will likely continue to fluctuate significantly in response to numerous factors in addition to the ones described in the preceding risk factors, many of which are beyond our control, including: • overall performance of the equity markets and the economy as a whole; • changes in the financial projections we may provide to the public or our failure to meet these projections; • actual or anticipated changes in our growth rate relative to that of our competitors; • changes in the anticipated future size or growth rate of our addressable markets; • announcements of new products and services, technological and platform updates or enhancements, or of acquisitions, strategic partnerships, joint ventures or capital-raising activities or commitments, by us or by our competitors; • disruptions to our products and services or our other technology; • additions or departures of board members, management or key personnel; • failure of securities analysts to initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow our company or our failure to meet these estimates or the expectations of investors; • rumors and market speculation involving us or other companies in our industry; • new laws or regulations or new interpretations of existing laws or regulations applicable to our business; • lawsuits threatened or filed against us or investigations by governmental authorities; • other events or factors, including those resulting from war, incidents of terrorism, or responses to these events; • health epidemics, such as the COVID-19 pandemic, influenza, and other highly communicable diseases; and • sales of shares of our common stock by us or our stockholders.
The market price of our common stock has and will likely continue to fluctuate significantly in response to numerous factors in addition to the ones described in the preceding risk factors, many of which are beyond our control, including: • overall performance of the equity markets and the economy as a whole; • changes in the financial projections we may provide to the public or our failure to meet these projections; • actual or anticipated changes in our growth rate relative to that of our competitors; • changes in the anticipated future size or growth rate of our addressable markets; • announcements of new products and services, technological and platform updates or enhancements, or of acquisitions, strategic partnerships, joint ventures or capital-raising activities or commitments, by us or by our competitors; • disruptions to our products and services or our other technology; • additions or departures of board members, management or key personnel; 46 Table of Contents • failure of securities analysts to initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow our company or our failure to meet these estimates or the expectations of investors; • rumors and market speculation involving us or other companies in our industry; • new laws or regulations or new interpretations of existing laws or regulations applicable to our business; • lawsuits threatened or filed against us or investigations by governmental authorities; • other events or factors, including those resulting from war, incidents of terrorism, or responses to these events; • health epidemics, such as the COVID-19 pandemic, influenza, and other highly communicable diseases; and • sales of shares of our common stock by us or our stockholders.
The market for vertically tailored customer experience and payments software in general, and cloud-based communications in particular, is subject to rapid technological change, evolving industry standards, changing regulations, as well as changing customer needs, requirements and preferences. Customers and consumers may choose to adopt other forms of electronic communications or alternative customer 27 engagement platforms.
The market for vertically tailored customer experience and payments software in general, and cloud-based communications in particular, is subject to rapid technological change, evolving industry standards, changing regulations, as well as changing customer needs, requirements and preferences. Customers and consumers may choose to adopt other forms of electronic communications or alternative customer engagement platforms.
Acquisitions may disrupt our ongoing operations, divert management from their primary responsibilities, subject us to additional liabilities, increase our expenses, subject us to increased 35 regulatory requirements, cause adverse tax consequences or unfavorable accounting treatment, expose us to claims and disputes by stockholders and third parties, and adversely impact our business, financial condition, and results of operations.
Acquisitions may disrupt our ongoing operations, divert management from their primary responsibilities, subject us to additional liabilities, increase our expenses, subject us to increased regulatory requirements, cause adverse tax consequences or unfavorable accounting treatment, expose us to claims and disputes by stockholders and third parties, and adversely impact our business, financial condition, and results of operations.
Despite initially denying non-facilities based providers access, the Canadian Secure Token Governance Authority (“CST-GA”) created a process in November 2021 for such providers to obtain Service Provider Code Tokens and, in turn, Secure Telephone Identity Certificates (“STI Certificates”) to allow higher (Level A or B) call 42 attestation.
Despite initially denying non-facilities based providers access, the Canadian Secure Token Governance Authority (“CST-GA”) created a process in November 2021 for such providers to obtain Service Provider Code Tokens and, in turn, Secure Telephone Identity Certificates (“STI Certificates”) to allow higher (Level A or B) call attestation.
In addition, even if we are able to identify replacement hardware, software or services or are 28 able to internally develop a replacement solution, integrating any new hardware, software or service could be costly and time-consuming and may not result in an equivalent solution, any of which could adversely affect our business, results of operations and financial condition.
In addition, even if we are able to identify replacement hardware, software or services or are able to internally develop a replacement solution, integrating any new hardware, software or service could be costly and time-consuming and may not result in an equivalent solution, any of which could adversely affect our business, results of operations and financial condition.
Furthermore, volatility or lack of performance in our stock price may affect our ability to attract and retain replacements should key personnel depart. If we are not able to retain our key personnel, our business, results of operations and financial condition could be harmed. 40 Our loan agreement contains certain restrictions that may limit our ability to operate our business.
Furthermore, volatility or lack of performance in our stock price may affect our ability to attract and retain replacements should key personnel depart. If we are not able to retain our key personnel, our business, results of operations and financial condition could be harmed. Our loan agreement contains certain restrictions that may limit our ability to operate our business.
Enhancements and new products that we develop may not be introduced in a timely or cost-effective manner, may contain errors 26 or defects, may require reworking features and capabilities, may have interoperability difficulties with our platform or other products or may not achieve the broad market acceptance necessary to generate significant revenue.
Enhancements and new products that we develop may not be introduced in a timely or cost-effective manner, may contain errors or defects, may require reworking features and capabilities, may have interoperability difficulties with our platform or other products or may not achieve the broad market acceptance necessary to generate significant revenue.
Should any of our competitors modify their technologies, standards, or terms of use in a manner that degrades the functionality or performance of our platform or is otherwise unsatisfactory to us or gives preferential treatment to our competitors’ products or services, our platform, business, financial condition, and results of operations could be adversely affected.
Should any of our competitors modify their technologies, standards, or terms of use in a manner that degrades the functionality or performance of our platform or is otherwise unsatisfactory to us or gives preferential treatment to our competitors’ products or services, our brand, platform, business, financial condition, and results of operations could be adversely affected.
Anti- corruption and anti-bribery laws have been enforced aggressively in recent years and are interpreted broadly and prohibit companies and their employees and agents from promising, authorizing, making, offering, soliciting, or accepting, directly or indirectly, improper payments or other benefits to or from any person whether in the public or private sector.
Anti- corruption and anti-bribery laws have been enforced aggressively in recent years and are interpreted broadly. They prohibit companies and their employees and agents from promising, authorizing, making, offering, soliciting, or accepting, directly or indirectly, improper payments or other benefits to or from any person whether in the public or private sector.
In addition, our customers may be acquired by or may consolidate into larger and multi-location businesses that may demand more features, integration services and customization, and may require more highly skilled sales and support personnel. These new businesses may also demand service-level agreements or other contractual terms that may introduce additional risk.
In addition, our customers may be acquired by or may consolidate into larger and multi-location organizations that may demand more features, integration services and customization, and may require more highly skilled sales and support personnel. These new businesses may also demand service-level agreements or other contractual terms that may introduce additional risk.
Our future success depends, in part, on our ability to continue to attract and retain highly skilled employees. We believe that there is, and will continue to be, intense competition for highly skilled management, technical, sales and other employees with experience in our industry in Utah, where our headquarters are located, and in other locations where we maintain offices.
Our future success depends, in part, on our ability to continue to attract and retain highly skilled employees. We believe that there is, and will continue to be, intense competition for highly skilled management, technical, sales and other employees with experience in our industry in Utah, where our headquarters are located, and in other locations where we may maintain offices.
Employees may be more likely to terminate their employment with us if the shares they own or the shares underlying their vested options have significantly appreciated in value relative to the original purchase prices of the shares or the exercise prices of the options, or, conversely, if the exercise prices of the options that they hold are significantly above the trading price of our common stock.
Employees may be more likely to terminate their employment with us if the shares they own or the shares underlying their vested options have significantly not appreciated in value relative to the original purchase prices of the shares or the exercise prices of the options, or, conversely, if the exercise prices of the options that they hold are significantly above the trading price of our common stock.
Sustaining our growth will place significant demands on our management as well as on our administrative, operational, and financial resources, particularly while we continue to navigate relatively recent transitions in management and challenging macroeconomic conditions. If we are unable to manage our growth effectively, our revenue and profits could be adversely affected.
Sustaining our growth will place demands on our management as well as on our administrative, operational, and financial resources, particularly while we continue to navigate relatively recent transitions in management and challenging macroeconomic conditions. If we are unable to manage our growth effectively, our revenue and profits could be adversely affected.
Further, SMBs are fragmented in terms of size, geography, sophistication and nature of business and, consequently, are more challenging to serve at scale and in a cost-effective manner. Many of these SMBs are in the early stages of their development and there is no 19 guarantee that their businesses will succeed.
Further, SMBs are fragmented in terms of size, geography, sophistication and nature of business and, consequently, are more challenging to serve at scale and in a cost-effective manner. Many of these SMBs are in the early stages of their development and there is no guarantee that their businesses will succeed.
In addition, we cannot guarantee that these agreements will 48 not be breached, that we will have adequate remedies for any breach, or that the applicable counterparties to such agreements will not assert rights to our intellectual property rights, internally-developed technology or other proprietary information arising out of these relationships.
In addition, we cannot guarantee that these agreements will not be breached, that we will have adequate remedies for any breach, or that the applicable counterparties to such agreements will not assert rights to our intellectual property rights, internally-developed technology or other proprietary information arising out of these relationships.
In addition, if our security, or that of GCP, is compromised, or our products or platform are unavailable or our users are unable to use our products within a reasonable amount of time or at all, then our business, results of operations and financial condition could 31 be adversely affected.
In addition, if our security, or that of GCP, is compromised, or our products or platform are unavailable or our users are unable to use our products within a reasonable amount of time or at all, then our business, results of operations and financial condition could be adversely affected.
If we are unable to retain and motivate our existing employees and attract qualified employees to fill key positions, we may be unable to manage our business effectively, including the development, marketing 39 and sale of our platform and products, which could adversely affect our business, results of operations and financial condition.
If we are unable to retain and motivate our existing employees and attract qualified employees to fill key positions, we may be unable to manage our business effectively, including the development, marketing and sale of our platform and products, which could adversely affect our business, results of operations and financial condition.
This, in turn, could harm our business, financial condition and results of operations. The standards that Mobile Network Operators use to regulate the delivery of SMS text messages have in the past interfered with, and may in the future interfere with, the effectiveness of our platform and our ability to conduct business.
This, in turn, could harm our business, financial condition and results of operations. The standards that Mobile Network Operators use to regulate the delivery of text messages have in the past interfered with, and may in the future interfere with, the effectiveness of our platform and our ability to conduct business.
If such claims are successful, our business and results of operations could be harmed, and even if the claims do not result in litigation or are resolved in our favor, these claims, and the time and 57 resources necessary to resolve them, could divert the resources of our management and harm our business, results of operations, and financial condition.
If such claims are successful, our business and results of operations could be harmed, and even if the claims do not result in litigation or are resolved in our favor, these claims, and the time and resources necessary to resolve them, could divert the resources of our management and harm our business, results of operations, and financial condition.
In addition, 22 a significant percentage of our operating expenses is fixed in nature and is based on forecasted revenue trends. Accordingly, in the event of a revenue shortfall, we may not be able to mitigate the negative impact on our loss and margins in the short term.
In addition, a significant percentage of our operating expenses is fixed in nature and is based on forecasted revenue trends. Accordingly, in the event of a revenue shortfall, we may not be able to mitigate the negative impact on our loss and margins in the short term.
The success of our business strategy relies, in part, on our ability to form and maintain these integrations with such partners on customary terms in order to facilitate and permit the integration of our platform and 24 products into the systems or software used by our customers.
The success of our business strategy relies, in part, on our ability to form and maintain these integrations with such partners on customary terms in order to facilitate and permit the integration of our platform and products into the systems or software used by our customers.
As a result, our gross margin may be adversely impacted and fluctuate as we expand our operations and customer base worldwide. 38 Our failure to manage any of these risks successfully could harm our international operations, and adversely affect our business, results of operations and financial condition.
As a result, our gross margin may be adversely impacted and fluctuate as we expand our operations and customer base worldwide. Our failure to manage any of these risks successfully could harm our international operations, and adversely affect our business, results of operations and financial condition.
In addition, we will face risks in doing business internationally that could adversely affect our business, including: 37 • the difficulty of managing and staffing international operations and the increased operations, travel, infrastructure and legal compliance costs associated with servicing international customers and operating numerous international locations; • our ability to effectively price our products in competitive international markets; • new and different sources of competition or other changes to our current competitive landscape; • understanding, reconciling and complying with different technical standards, telecommunications and payment processing regulations, registration and certification requirements outside the United States, which could prevent customers from deploying our platform and products and limit the features and functionality we may be able to provide or limit their usage; • potentially greater difficulty collecting accounts receivable and longer payment cycles; • higher or more variable network service provider fees outside of the United States; • the need to adapt and localize our products for specific countries; • the need to offer customer support in various languages; • difficulties in understanding and complying with local laws, regulations and customs in non-U.S. jurisdictions; • export controls and economic sanctions administered by the Department of Commerce Bureau of Industry and Security and the Treasury Department’s Office of Foreign Assets Control; • compliance with various anti-bribery and anti-corruption laws such as the Foreign Corrupt Practices Act; • changes in international trade policies, tariffs and other non-tariff barriers, such as quotas and local content rules; • more limited protection for intellectual property rights in some countries; • adverse tax consequences; • fluctuations in currency exchange rates, which could increase the price of our products outside of the United States, increase the expenses of our international operations and expose us to foreign currency exchange rate risk; • fluctuations in exchange rates and the resulting impact on our business; • restrictions on the transfer of funds; • deterioration of political relations between the United States and other countries; • the impact of natural disasters and public health epidemics or pandemics on employees, contingent workers, partners, travel and the global economy and the ability to operate freely and effectively in a region that may be fully or partially on lockdown; and • political or social unrest or economic instability in a specific country or region in which we operate, which could have an adverse impact on our operations in that location.
In addition, we will face risks in doing business internationally that could adversely affect our business, including: • the difficulty of managing and staffing international operations and the increased operations, travel, infrastructure and legal compliance costs associated with servicing international customers and operating numerous international locations; • our ability to effectively price our products in competitive international markets; • new and different sources of competition or other changes to our current competitive landscape; • understanding, reconciling and complying with different technical standards, telecommunications and payment processing regulations, registration and certification requirements outside the U.S., which could prevent customers from deploying our platform and products and limit the features and functionality we may be able to provide or limit their usage; • potentially greater difficulty collecting accounts receivable and longer payment cycles; • higher or more variable network service provider fees outside of the U.S.; • the need to adapt and localize our products for specific countries; • the need to offer customer support in various languages; • difficulties in understanding and complying with local laws, regulations and customs in non-U.S. jurisdictions; • export controls and economic sanctions administered by the Department of Commerce Bureau of Industry and Security and the Treasury Department’s Office of Foreign Assets Control; 30 Table of Contents • compliance with various anti-bribery and anti-corruption laws such as the Foreign Corrupt Practices Act; • changes in international trade policies, tariffs and other non-tariff barriers, such as quotas and local content rules; • more limited protection for intellectual property rights in some countries; • adverse tax consequences; • fluctuations in currency exchange rates, which could increase the price of our products outside of the U.S., increase the expenses of our international operations and expose us to foreign currency exchange rate risk; • fluctuations in exchange rates and the resulting impact on our business; • restrictions on the transfer of funds; • deterioration of political relations between the U.S. and other countries; • the impact of natural disasters and public health epidemics or pandemics on employees, contingent workers, partners, travel and the global economy and the ability to operate freely and effectively in a region that may be fully or partially on lockdown; and • political or social unrest or economic instability in a specific country or region in which we operate, which could have an adverse impact on our operations in that location.
Regulations to which we may be subject address the following matters, among others: • license requirements that apply to providers of communications services in many jurisdictions; • acceptable marketing practices; • our obligation to contribute to various Universal Service Fund (“USF”) programs, programs for funding access to relay services and number administration, including at the state level; 41 • monitoring on rural call completion rates; • safeguarding and use of Customer Proprietary Network Information; • U.S. and Canadian regulations concerning access requirements for users with disabilities; • our obligation to offer 7-1-1 abbreviated dialing for access to relay services; • compliance with the requirements of U.S. and foreign law enforcement agencies, including the Communications Assistance for Law Enforcement Act and cooperation with local authorities in conducting wiretaps, pen traps and other surveillance activities; • the ability to dial 9-1-1 (or corresponding numbers in regions outside the U.S.), auto-locate E-911 calls (or corresponding equivalents) when required, and access emergency services; • the transmission of telephone numbers associated with calling parties between carriers and service providers like Weave; • regulations governing outbound dialing, including the Telephone Consumer Protection Act; and • FCC and other regulators efforts to combat robo-calling, caller ID spoofing, and robo-texting.
Regulations to which we may be subject address the following matters, among others: • license requirements that apply to providers of communications services in many jurisdictions; • acceptable marketing practices; • our obligation to contribute to various Universal Service Fund (“USF”) programs, programs for funding access to relay services and number administration, including at the state level; • monitoring on rural call completion rates; • safeguarding and use of Customer Proprietary Network Information; • U.S. and Canadian regulations concerning access requirements for users with disabilities; • our obligation to offer 7-1-1 abbreviated dialing for access to relay services; • compliance with the requirements of U.S. and foreign law enforcement agencies, including the Communications Assistance for Law Enforcement Act and cooperation with local authorities in conducting wiretaps, pen traps and other surveillance activities; • the ability to dial 9-1-1 (or corresponding numbers in regions outside the U.S.), auto-locate E-911 calls (or corresponding equivalents) when required, and access emergency services; • the transmission of telephone numbers associated with calling parties between carriers and service providers like Weave; • regulations governing outbound dialing, including the TCPA; and • FCC and other regulators efforts to combat robo-calling, caller ID spoofing, and robo-texting.
We have experienced, and may in the future experience, disruptions, outages, and other performance problems related to our platform due to a variety of factors, including infrastructure changes, introductions of new functionality, human or software errors, delays in scaling our technical infrastructure if we do not maintain enough excess capacity and accurately predict our infrastructure requirements, capacity constraints due to an overwhelming number of users accessing our platform simultaneously, denial-of-service attacks, human error, actions or inactions attributable to third parties, earthquakes, hurricanes, floods, fires, natural disasters, power losses, disruptions in telecommunications services, fraud, military or political conflicts, terrorist attacks and other geopolitical unrest, computer viruses, ransomware, malware or other events.
We have experienced, and may in the future experience, disruptions, 25 Table of Contents outages, and other performance problems related to our platform due to a variety of factors, including infrastructure changes, introductions of new functionality, human or software errors, delays in scaling our technical infrastructure if we do not maintain enough excess capacity and accurately predict our infrastructure requirements, capacity constraints due to an overwhelming number of users accessing our platform simultaneously, denial-of-service attacks, human error, actions or inactions attributable to third parties, earthquakes, hurricanes, floods, fires, natural disasters, power losses, disruptions in telecommunications services, fraud, military or political conflicts, terrorist attacks and other geopolitical unrest, computer viruses, ransomware, malware or other events.
If we do not develop enhancements to our platform and products and introduce new products that achieve market acceptance, our business, results of operations and financial condition would be adversely affected.
If we do not continue to develop enhancements to our platform and products and introduce new products that achieve market acceptance, our business, results of operations and financial condition would be adversely affected.
If we do not handle customer complaints effectively, then our brand and reputation may suffer, our customers may lose confidence in us and they may reduce or cease their use of our products. In addition, many of our customers post and discuss on social media about internet-based products and services, including our platform and products.
If we do not handle customer feedback effectively, then our brand and reputation may suffer, our customers may lose confidence in us and they may reduce or cease their use of our products. In addition, many of our customers post and discuss on social media about internet-based products and services, including our platform and products.
The market in which we participate is highly competitive, and if we do not compete effectively, our business, results of operations and financial condition could be harmed. The market for our platform and products is evolving, significantly fragmented and highly competitive, with relatively low barriers to entry in some segments.
The market in which we participate is highly competitive, and if we do not compete effectively, our business, results of operations and financial condition would be harmed. The market for our platform and products is evolving, significantly fragmented and highly competitive, with relatively low barriers to entry in some segments.
In these market segments, the decision to purchase our subscriptions may require the approval of more technical personnel and management levels within a potential customer’s organization and, therefore, sales to larger and multi-location businesses may require us to invest more time educating potential customers about the benefits of our subscriptions.
In these market segments, the decision to purchase our subscriptions may require the approval of more technical personnel and management levels within a potential customer’s organization and, therefore, sales to larger and multi-location organizations may require us to invest more time educating potential customers about the benefits of our subscriptions.
Risks that we face in undertaking future expansion include: • effectively recruiting, integrating, training, and motivating a large number of new employees, including our customer services representatives, direct sales force, and engineering resources, while retaining existing employees and reducing the rate of employee turnover, maintaining the beneficial aspects of our corporate culture, and effectively executing our business plan; • successfully improving and expanding the capabilities of our platform and introducing new products and services; • controlling expenses and investments in anticipation of expanded operations; and • managing the expansion of operations in the United States and potentially in additional countries in the future, which will place additional demands on our resources and operations.
Risks that we face in undertaking future expansion include: • effectively recruiting, integrating, training, and motivating a large number of new employees, including our customer services representatives, direct sales force, and engineering resources, while retaining existing employees and reducing the rate of employee turnover, maintaining the beneficial aspects of our corporate culture, and effectively executing our business plan; • successfully improving and expanding the capabilities of our platform and introducing new products and services; • controlling expenses and investments in anticipation of expanded operations; and • managing the expansion of operations in the U.S. and potentially in additional countries in the future, which will place additional demands on our resources and operations.
Some of the important factors that may cause our results of operations to fluctuate from quarter to quarter include: • inflation and interest rate trends and impacts on our customers and the U.S. economy in general; 21 • our ability to retain and increase revenue from existing customers and attract new customers; • our ability to introduce new products and enhance existing products; • our success in penetrating new vertical markets; • competition and the actions of our competitors, including pricing changes and the introduction of new products, services and geographies; • changes in laws, industry standards, regulations or regulatory enforcement in the United States or internationally; • changes in network service provider fees that we pay in connection with the delivery of communications on our platform; • changes in payment processing network and partner fees; • increases in fees from integration partners, such as providers of practice management systems or accounting software; • changes in cloud infrastructure fees that we pay in connection with the operation of our platform; • changes in our pricing as a result of our optimization efforts or otherwise; • the rate of expansion and productivity of our sales force; • change in the mix of our product offerings that our customers use; • the amount and timing of operating costs and capital expenditures related to the operations and expansion of our business, including investments in research and development of new features and functionality for our platform, products and services, our international expansion and additional systems and processes; • costs associated with defending and resolving intellectual property infringement and other claims; • significant security breaches of, technical difficulties with, or interruptions to, the delivery and use of our products on our platform; • expenses in connection with mergers, acquisitions or other strategic transactions and the follow-on costs of integration; • the timing of customer payments and any difficulty in collecting accounts receivable from customers; • general economic conditions that may adversely affect a prospective customer’s ability or willingness to adopt our products, delay a prospective customer’s adoption decision, reduce the revenue that we generate from subscriptions to our platform and use of our products or affect customer retention; • sales tax and other tax determinations by authorities in the jurisdictions in which we conduct business; • the impact of new accounting pronouncements; and • fluctuations in stock-based compensation expense.
Some of the important factors that may cause our results of operations to fluctuate from quarter to quarter include: • inflation and interest rate trends and impacts on our customers and the U.S. economy in general; • our ability to retain and increase revenue from existing customers and attract new customers; • our ability to introduce new products and enhance existing products; 14 Table of Contents • our success in penetrating new vertical markets; • competition and the actions of our competitors, including pricing changes and the introduction of new products, services and geographies; • changes in laws, industry standards, regulations or regulatory enforcement in the U.S. or internationally; • changes in network service provider fees that we pay in connection with the delivery of communications on our platform; • changes in payment processing network and partner fees; • increases in fees from integration partners, such as PMS providers; • changes in cloud infrastructure fees that we pay in connection with the operation of our platform; • changes in our pricing as a result of our optimization efforts or otherwise; • the rate of expansion and productivity of our sales force; • change in the mix of our product offerings that our customers use; • the amount and timing of operating costs and capital expenditures related to the operations and expansion of our business, including investments in research and development of new features and functionality for our platform, products and services, our international expansion and additional systems and processes; • costs associated with defending and resolving intellectual property infringement and other claims; • significant security breaches of, technical difficulties with, or interruptions to, the delivery and use of our products on our platform; • expenses in connection with mergers, acquisitions or other strategic transactions and the follow-on costs of integration; • the timing of customer payments and any difficulty in collecting accounts receivable from customers; • general economic conditions that may adversely affect a prospective customer’s ability or willingness to adopt our products, delay a prospective customer’s adoption decision, reduce the revenue that we generate from subscriptions to our platform and use of our products or affect customer retention; • sales tax and other tax determinations by authorities in the jurisdictions in which we conduct business; • the impact of new accounting pronouncements; and • fluctuations in stock-based compensation expense.
Additional risks and uncertainties not presently known to us or that we currently believe are not material may also impair our business, financial condition, results of operations and growth prospects. Risks Related to our Business and our Industry Our recent rapid growth may not be indicative of our future growth.
Additional risks and uncertainties not presently known to us or that we currently believe are not material may also impair our business, financial condition, results of operations and growth prospects. Risks Related to our Business and our Industry Our recent growth rates may not be indicative of our future growth.
If a significant portion of these intermediaries stop providing services or stop providing services on a cost-effective basis, our business could be adversely affected. We also interconnect with internet service providers to enable the use of our communications products by our customers, and we expect that we will continue to rely on internet service providers for network connectivity going forward.
If a significant portion of these intermediaries stop providing services or stop providing services on a cost-effective basis, our business could be adversely affected. 23 Table of Contents We also interconnect with internet service providers to enable the use of our communications products by our customers, and we expect that we will continue to rely on internet service providers for network connectivity going forward.
These laws and regulations include HIPAA, which establishes a set of national privacy and security standards for the protection of protected health information (“PHI”) by health plans, healthcare clearinghouses and certain healthcare providers, referred to as covered entities, and individuals and entities that perform services for them which involve the use, or disclosure of, individually identifiable health information, known as business associates and their subcontractors.
These laws and regulations include HIPAA, which establishes a set of national privacy and security standards for the protection of PHI by health plans, healthcare clearinghouses and certain healthcare providers, referred to as covered entities, and individuals and entities that perform services for them which involve the use, or disclosure of, individually identifiable health information, known as business associates and their subcontractors.
As we target a portion of our sales efforts at larger and multi-location businesses, we may incur higher costs and longer sales and installation cycles, and we may be less effective at predicting when we will complete these sales.
As we target a portion of our sales efforts at larger and multi-location organizations, we may incur higher costs and longer sales and installation cycles, and we may be less effective at predicting when we will complete these sales.
Moreover, despite our ongoing and substantial efforts to limit such use, certain customers may use our platform to transmit unauthorized, offensive or illegal messages, spam, phishing scams, and website links to harmful applications, reproduce and distribute copyrighted material or the trademarks of others without permission, and report inaccurate or fraudulent data or information.
Moreover, despite our ongoing and substantial efforts to limit such use, certain customers may use our platform to transmit unauthorized, offensive or illegal messages, spam, phishing scams, and website links to harmful applications, reproduce and distribute copyrighted material or the trademarks of others 36 Table of Contents without permission, and report inaccurate or fraudulent data or information.
You should carefully consider the risks and uncertainties described below, together with all of the other information in this Annual Report on Form 10-K, including our consolidated financial statements and the related notes and the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations”before making an investment decision.
You should carefully consider the risks and uncertainties described below, together with all of the other information in this Annual Report on Form 10-K, including our consolidated financial statements and the related notes and the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” before making an investment decision.
Approximately one-third of our current customer service and support staff has been employed with us for less than one year and therefore may be less familiar with our platform and products than our more tenured employees.
Approximately one quarter of our current customer service and support staff has been employed with us for less than one year and therefore may be less familiar with our platform and products than our more tenured employees.
Any of the above circumstances or events may harm our reputation, erode customer trust, cause customers to stop using our products, impair our ability to increase revenue from existing customers, impair our ability to grow our customer base, subject us to financial penalties and liabilities under certain of our agreements and otherwise harm our business, results of operations and financial condition.
Any of the above circumstances or events may harm our reputation, erode customer trust, cause customers to stop using our products, impair our ability to increase revenue from existing customers, 24 Table of Contents impair our ability to grow our customer base, subject us to financial penalties and liabilities under certain of our agreements and otherwise harm our business, results of operations and financial condition.
We incur chargeback liability when our customers refuse to or cannot reimburse chargebacks resolved in favor of their customers. While we have not experienced these issues to a significant degree in the past, any increase in chargebacks not paid by our customer may adversely affect our business, financial condition or results of operations.
We incur chargeback liability when our customers refuse to or cannot reimburse chargebacks resolved in favor of their customers. While we have not experienced these issues to a significant 31 Table of Contents degree in the past, any increase in chargebacks not paid by our customer may adversely affect our business, financial condition or results of operations.
For as long as we continue to be an emerging growth company, we may choose to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies, including not being required to comply with the auditor attestation requirements of Section 404, reduced Public Company Accounting Oversight Board (United States) reporting requirements, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
For as long as we continue to be an emerging growth company, we may choose to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced Public Company Accounting Oversight Board reporting requirements, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
These changes may yield unintended consequences and costs, such as additional attrition, the distraction of employees, reduced employee morale and could adversely affect both our reputation as an employer and our company culture, which could make it more difficult for us to hire new employees in the future.
These changes may yield unintended consequences and costs, such as additional attrition, the 32 Table of Contents distraction of employees, reduced employee morale and could adversely affect both our reputation as an employer and our company culture, which could make it more difficult for us to hire new employees in the future.
Our ability to attract additional customers will depend on a number of factors, including the effectiveness of our sales team, the success of our marketing efforts, our levels of investment in expanding our sales and marketing teams, referrals by existing customers, our brand recognition within the markets we address, our efforts to provide satisfactory customer service, the stability and reliability of our platform, our ability to timely onboard new customers or timely expand functionality for our existing customers, the perceived value of our platform and the features and functionality it offers, our ability to leverage and scale our core sales efforts and marketing capabilities to focus on our core specialty healthcare verticals, and the nature and availability of competitive offerings.
Our ability to attract additional customers will depend on a number of factors, including the effectiveness of our sales team, the success of our marketing efforts, our levels of investment in expanding our sales and marketing teams, referrals by existing customers, our brand recognition within the markets we address, our efforts to provide satisfactory customer service, the stability and reliability of our platform, our ability to timely onboard new customers or timely expand functionality for our existing customers, the perceived value of our platform and the features and functionality it offers, our ability to integrate our platform with a broad range of PMS, our ability to leverage and scale our core sales efforts and marketing capabilities to focus on our core specialty healthcare verticals, and the nature and availability of competitive offerings.
The market for our platform and products could fail to grow significantly or there could be a reduction in demand for our platform and products as a result of a lack of customer acceptance, technological challenges, competing products and services, decreases in spending by current and prospective customers, weakening economic conditions and other causes.
The market for our platform and products could fail to grow significantly or there 16 Table of Contents could be a reduction in demand for our platform and products as a result of a lack of customer acceptance, technological challenges, competing products and services, decreases in spending by current and prospective customers, weakening economic conditions and other causes.
Non-compliance with these laws could subject us to investigations, sanctions, settlements, prosecution, other enforcement actions, disgorgement of profits, significant fines, damages, other civil and criminal penalties or injunctions, adverse media coverage and other consequences. Any investigations, actions, or sanctions could harm our business, results of operations and financial condition.
Non-compliance with these laws could subject us to investigations, sanctions, settlements, prosecution, other enforcement actions, disgorgement of profits, significant fines, 40 Table of Contents damages, other civil and criminal penalties or injunctions, adverse media coverage and other consequences. Any investigations, actions, or sanctions could harm our business, results of operations and financial condition.
If our strategies are not fully effective or we are not successful in 60 identifying and mitigating all risks to which we are or may be exposed, we may suffer uninsured liability or harm to our reputation, or be subject to litigation or regulatory actions, any of which could adversely affect our business, financial condition and results of operations.
If our strategies are not fully effective or we are not successful in identifying and mitigating all risks to which we are or may be exposed, we may suffer uninsured liability or harm to our reputation, or be subject to litigation or regulatory actions, any of which could adversely affect our business, financial condition and results of operations. Item 1B.
In addition, any delay in creating integrations with providers of systems or software used by our customers or potential customers could delay or impair our ability to enter new healthcare vertical markets or enhance the functionality of our platform and products, and reduce their competitiveness. Any such delay could adversely affect our business.
In addition, any delay in creating 17 Table of Contents integrations with providers of systems or software used by our customers or potential customers could delay or impair our ability to enter new healthcare vertical markets or enhance the functionality of our platform and products, and reduce their competitiveness. Any such delay could adversely affect our business.
Any such issuance of additional securities in the future may result in additional dilution to you or may adversely impact the price of our common stock. Sales of substantial amounts of our common stock by existing holders in the public markets, or the perception that they might occur, could cause the market price of our common stock to decline.
Any such issuance of additional securities in the future may result in additional dilution to you or may adversely impact the price of our common stock. 47 Table of Contents Sales of substantial amounts of our common stock by existing holders in the public markets, or the perception that they might occur, could cause the market price of our common stock to decline.
Any determination to pay dividends in the future will be at the discretion of our board of directors. Accordingly, investors must rely on sales of their common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investments.
Any determination to pay dividends in the future will be at the discretion of our board of directors. Accordingly, investors must rely 48 Table of Contents on sales of their common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investments.
Under those sections of the Code, if a corporation undergoes an “ownership change,” the corporation’s ability to use its pre-change NOL carryforwards and other pre-change attributes, such as research tax credits, to offset its post-change income or tax may be limited.
Under those sections of the Code, if a corporation undergoes an “ownership change,” the corporation’s ability to use its 44 Table of Contents pre-change NOL carryforwards and other pre-change attributes, such as research tax credits, to offset its post-change income or tax may be limited.
In addition, we may terminate our relationships with customers for various reasons, such as heightened credit risk, excessive card chargebacks, unacceptable business practices or contract breaches.
We may terminate our relationships with customers for various reasons, such as heightened credit risk, excessive card chargebacks, unacceptable business practices or contract breaches.
To prevent having to litigate claims in multiple jurisdictions and the threat of inconsistent or contrary rulings by different courts, among other considerations, our amended and restated certificate of incorporation provides that the federal district courts of the United States of America will be the exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act.
To prevent having to litigate claims in multiple jurisdictions and the threat of inconsistent or contrary rulings by different courts, among other considerations, our amended and restated certificate of incorporation provides that the federal district courts of the U.S. of America will be the exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act.
For example, a settlement may require us to obtain a license to continue practices found to be in violation of a third-party’s rights, which may not be available on reasonable terms and may significantly increase our operating expenses. A license to continue such practices may not be available to us at all.
For example, a settlement may require us to obtain a license to continue practices found to be in violation of a third-party’s rights, which may not be available on reasonable terms and may significantly increase our 41 Table of Contents operating expenses. A license to continue such practices may not be available to us at all.
Our risk management strategies may not be fully effective in mitigating our risk exposure in all market environments or against all types of risk. We operate in a rapidly changing industry. Accordingly, our risk management strategies may not be fully effective to identify, monitor and manage all risks that our business encounters.
Our risk management strategies may not be fully effective in mitigating our risk exposure in all market environments or against all types of risk. 52 Table of Contents We operate in a rapidly changing industry. Accordingly, our risk management strategies may not be fully effective to identify, monitor and manage all risks that our business encounters.
As a result of disclosure obligations required in our public filings, our business and financial condition has become more visible, which may result in an increased risk of threatened or actual litigation, including by competitors and other third parties.
As a result of disclosure obligations required in our public filings, our business and financial condition has become more visible, which may result in an increased risk of threatened or actual litigation, including by competitors and other third 49 Table of Contents parties.
Further, as positive references from existing customers are vital to expanding into new vertical and geographic markets, any dissatisfaction on the part of existing customers may harm our brand and reputation and inhibit market acceptance of our platform and products.
Further, as positive references from existing customers are vital to expanding into new vertical and geographic markets, any dissatisfaction on the part 26 Table of Contents of existing customers may harm our brand and reputation and inhibit market acceptance of our platform and products.
United States federal legislation and international laws impose certain obligations on the senders of commercial emails, which could minimize the effectiveness of our platform, and establish financial penalties for non-compliance, which could increase the costs of our business. Our text, voice and email messaging and management services, and our customers’ use of these services, expose us to various regulatory risks.
U.S. federal legislation and international laws impose certain obligations on the senders of commercial emails, which could minimize the effectiveness of our platform, and establish financial penalties for non-compliance, which could increase the costs of our business. Our text, voice and email messaging and management services, and our customers’ use of these services, expose us to various regulatory risks.
If current economic conditions persist or deteriorate further, our current and prospective customers may elect to decrease their budgets, which would limit our ability to grow our business and adversely affect our operating results. We may also experience adverse impacts from delayed sales and implementation cycles, including customers and prospective customers delaying contract signing or subscription renewals.
If current macroeconomic uncertainties persist or conditions deteriorate, our current and prospective customers may elect to decrease their budgets, which would limit our ability to grow our business and adversely affect our operating results. We may also experience adverse impacts from delayed sales and implementation cycles, including customers and prospective customers delaying contract signing or subscription renewals.
Failure to effectively develop and expand our marketing and sales capabilities could harm our ability to increase our customer base and achieve broader market acceptance of our platform. To increase total customers and achieve broader market acceptance of our platform and products, we will need to expand our marketing and sales operations, including our sales force.
Failure to effectively develop and expand our marketing and sales capabilities could harm our ability to increase our customer base and achieve broader market acceptance of our platform. 27 Table of Contents To increase total customers and achieve broader market acceptance of our platform and products, we will need to expand our marketing and sales operations, including our sales force.
While the Delaware courts have determined that such choice of forum provisions are facially valid, a stockholder may nevertheless seek to bring such a claim arising under the Securities Act against us, our directors, officers, or other employees in a venue other than in the federal district courts of the United States of America.
While the Delaware courts have determined that such choice of forum provisions are facially valid, a stockholder may nevertheless seek to bring such a claim arising under the Securities Act against us, our directors, officers, or other employees in a venue other than in the federal district courts of the U.S. of America.
If we fail to meet or exceed the expectations of investors or securities analysts, then the trading price of our common stock could fall substantially, and we could face costly lawsuits, including securities class action suits.
If we fail to meet or exceed the expectations of investors or 15 Table of Contents securities analysts, then the trading price of our common stock could fall substantially, and we could face costly lawsuits, including securities class action suits.
Our customers rely on SMS text messaging for communicating with their customers.
Our customers rely on text messaging for communicating with their customers.
We pass USF, E-911 fees, and other surcharges through to our customers, which may result in our subscriptions becoming more expensive or require that we absorb these costs. In the future, state public utility commissions may expand their jurisdiction over VoIP subscriptions like ours.
We pass USF, E-911 fees, and other surcharges through to our customers, which may result in our subscriptions becoming more expensive or require that we absorb 34 Table of Contents these costs. In the future, state public utility commissions may expand their jurisdiction over VoIP subscriptions like ours.
In addition, some competitors may offer products or services that address one or a limited number of functions at lower prices, with greater depth than our products or in different geographies or in vertical markets.
In 18 Table of Contents addition, some competitors may offer products or services that address one or a limited number of functions at lower prices, with greater depth than our products or in different geographies or in vertical markets.
However, as the popularity of text messaging increases over time, we expect the MNOs and the wireless communications industry to continue to implement additional requirements, restrictions, and fees for sending non-consumer messages.
However, as the popularity of text messaging increases over time, we expect the MNOs and the wireless communications industry to 29 Table of Contents continue to implement additional requirements, restrictions, and fees for sending non-consumer messages.
The STIR/SHAKEN framework is expected to be used throughout the world. Weave has implemented STIR/SHAKEN for voice traffic originating in the U.S. and we rely on our service providers to sign our voice traffic originating in Canada.
The STIR/SHAKEN framework is expected to be used throughout the world. We have implemented STIR/SHAKEN for voice traffic originating in the U.S. and we rely on our service providers to sign our voice traffic originating in Canada.
We cannot be sure that we will compete as successfully against companies with products that offer solutions in those markets as we have to date. In addition, we cannot be sure we will compete successfully against incumbent providers of solutions with established brands and market presence if we enter new healthcare vertical markets and new markets outside the United States.
We cannot be sure that we will compete as successfully against companies with products that offer solutions in those markets as we have to date. In addition, we cannot be sure we will compete successfully against incumbent providers of solutions with established brands and market presence if we enter new healthcare vertical markets and new markets outside the U.S..
We may open additional international offices and hire employees to work at these offices in order to gain access to additional technical talent. For example, we opened an office in India in 2021 and as of December 31, 2023 had approximately 89 employees in India to further our engineering and administrative operations.
We may open additional international offices and hire employees to work at these offices in order to gain access to additional technical talent. For example, we opened an office in India in 2021 and as of December 31, 2024 had approximately 100 employees in India to further our engineering and administrative operations.
We have significantly expanded our business and operations, and our business strategy contemplates that we will significantly expand our business and operations in the future. Our future operating results depend to a large extent on our ability to manage this expansion and growth successfully.
Our business strategy contemplates that we will expand our business and operations in the future. Our future operating results depend to a large extent on our ability to manage this expansion and growth successfully.
In addition, some of our customers may choose to use our platform and products and our competitors’ products at the same time. Moreover, as we expand the functionality of our platform and products to include additional solutions, address new healthcare vertical markets and enter new markets outside the United States, we may face additional sources of competition.
In addition, some of our customers may choose to use our platform and products and our competitors’ products at the same time. Moreover, as we expand the functionality of our platform and products to include additional solutions, address new healthcare vertical markets and enter new markets outside the U.S., we may face additional sources of competition.
As a result, our reputation and our brand could be harmed, and our business, results of operations and financial condition may be adversely affected. The use of artificial intelligence (“AI”) technologies in our platform and our business may not produce the desired benefits, and may result in increased liability, reputational harm, or other adverse consequences.
As a result, our reputation and our brand could be harmed, and our business, results of operations and financial condition may be adversely affected. The use of AI technologies in our platform and our business may not produce the desired benefits, and may result in increased liability, reputational harm, or other adverse consequences.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeLeadership for these teams are professionals with deep cybersecurity expertise across multiple industries, including our Head of Security. Our executive leadership team, along with input from the above teams, are responsible for our overall enterprise risk management system and processes and regularly consider cybersecurity risks in the context of other material risks to the company.
Biggest changeOur executive leadership team, along with input from the above teams, are responsible for our overall enterprise risk management system and processes and regularly consider cybersecurity risks in the context of other material risks to the company.
Added
Leadership for these teams are professionals with deep cybersecurity expertise across multiple industries, including our Head of Security, who has over twenty years of cybersecurity experience across multiple industries.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe believe that our current facilities in Lehi, Utah are suitable and adequate to meet our current needs in the United States, and we believe that suitable additional or substitute space will be available as needed to accommodate any expansion of our operations close to our current facility.
Biggest changeWe also maintain offices in Noida, India. 53 Table of Contents We believe that our existing facilities are adequate to meet our current needs, and we intend to add or change facilities as needs require. We believe that, if required, suitable additional or substitute space would be available to accommodate expansion of our operations.
Item 2. Properties As of December 31, 2023, we currently lease approximately 180,000 square feet of office space for our current corporate headquarters in Lehi, Utah under a lease agreement that expires in 2033. We also maintain offices in Noida, India.
Item 2. Properties As of December 31, 2024, we currently lease approximately 180,000 square feet of office space for our current corporate headquarters in Lehi, Utah under a lease agreement that expires in 2033.
Removed
We may decide to lease suitable office space in India to support our current team and anticipated growth there. 61

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThe results of any current or future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors. Item 4. Mine Safety Disclosures None. 62 Part II
Biggest changeThe results of any current or future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe comparisons in the graph below are based upon historical data and are not indicative of, nor intended to forecast, future performance of our common stock. 63 *$100 invested on November 11, 2021 in stock or index, including reinvestment of dividends. Fiscal year ending December 31. Copyright© 2023 Standard & Poor's, a division of S&P Global. All rights reserved.
Biggest changeThe comparisons in the graph below are based upon historical data and are not indicative of, nor intended to forecast, future performance of our common stock. 55 Table of Contents *$100 invested on November 11, 2021 in stock or index, including reinvestment of dividends. Fiscal year ending December 31. Copyright© 2023 Standard & Poor's, a division of S&P Global.
Copyright© 2023 Russell Investment Group. All rights reserved. Sale of Unregistered Securities and Use of Proceeds None. Issuer Purchases of Equity Securities None. Item 6. [Reserved]
All rights reserved. Copyright© 2023 Russell Investment Group. All rights reserved. Sale of Unregistered Securities and Use of Proceeds None. Issuer Purchases of Equity Securities None. Item 6. Reserved
Prior to that date, there was no public market for our common stock. Holders of Record As of March 8, 2024, there were 34 holders of record of our common stock. This figure does not include a substantially greater number of beneficial holders of our common stock whose shares are held off record by banks, brokers and other financial institutions.
Prior to that date, there was no public market for our common stock. Holders of Record As of March 7, 2025, there were 10 holders of record of our common stock. This figure does not include a substantially greater number of beneficial holders of our common stock whose shares are held off record by banks, brokers and other financial institutions.
The following graph depicts the total cumulative stockholder return on our common stock from November 11, 2021, the first day of trading of our common stock on The New York Stock Exchange, through December 31, 2023, relative to the performance of the Standard & Poor's (S&P) 500 Index and the Russell 2000 Index.
The following graph depicts the total cumulative stockholder return on our common stock from November 11, 2021, the first day of trading of our common stock on The New York Stock Exchange, through December 31, 2024, relative to the performance of the Standard & Poor's (“S&P”) 500 Index and the Russell 2000 Index.

Item 7. Management's Discussion & Analysis

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

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Biggest changeBecause of the uncertainty of the realization of the deferred tax assets, we have a full valuation allowance for domestic net deferred tax assets, including net operating loss carryforwards. 70 Results of Operations The following table sets forth our consolidated statements of operations data for the periods indicated: Year Ended December 31, 2023 2022 (in thousands) Revenue $ 170,468 $ 142,117 Cost of revenue (1) 54,377 53,276 Gross profit 116,091 88,841 Operating expenses: Sales and marketing (1) 70,765 65,378 Research and development (1) 34,040 30,714 General and administrative (1) 45,652 42,453 Total operating expenses 150,457 138,545 Loss from operations (34,366) (49,704) Other income (expense): Interest income 2,196 1,155 Interest expense (1,923) (1,441) Other income (expense), net 3,322 356 Loss before income taxes (30,771) (49,634) Provision for income taxes (260) (104) Net loss $ (31,031) $ (49,738) ______________ (1) Includes stock-based compensation expense as follows: Year Ended December 31, 2023 2022 (in thousands) Cost of revenue $ 971 $ 723 Sales and marketing 4,233 3,436 Research and development 5,590 4,576 General and administrative 12,029 10,017 Total stock-based compensation $ 22,823 $ 18,752 See Note 12 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details. 71 The following table sets forth our consolidated statements of operations data expressed as a percentage of revenue for the periods indicated: Year Ended December 31, 2023 2022 (percentage of total revenue) Revenue 100 % 100 % Cost of revenue 32 37 Gross profit 68 63 Operating expenses: Sales and marketing 42 46 Research and development 20 22 General and administrative 27 30 Total operating expenses 88 97 Loss from operations (20) (35) Other income (expense): Interest income 1 1 Interest expense (1) (1) Other income (expense), net 2 — Loss before income taxes (18) (35) Provision for income taxes — — Net loss (18) % (35) % Comparison of the Years Ended December 31, 2023 and December 31, 2022 Revenue Year Ended December 31, Change 2023 2022 Amount Percentage (dollars in thousands) Revenue $ 170,468 $ 142,117 $ 28,351 20 % Revenue increased by $28.4 million, or 20%, for the year ended December 31, 2023 compared to the year ended December 31, 2022.
Biggest changeBecause of the uncertainty of the realization of the deferred tax assets, we have a full valuation allowance for domestic net deferred tax assets, including net operating loss carryforwards. 62 Table of Contents Results of Operations The following table sets forth our consolidated statements of operations data for the periods indicated: Year Ended December 31, 2024 2023 (in thousands) Revenue $ 204,314 $ 170,468 Cost of revenue (1) 58,432 54,377 Gross profit 145,882 116,091 Operating expenses: Sales and marketing (1) 84,612 70,765 Research and development (1) 40,231 34,040 General and administrative (1) 52,452 45,652 Total operating expenses 177,295 150,457 Loss from operations (31,413) (34,366) Other income (expense): Interest income 1,851 2,196 Interest expense (1,523) (1,923) Other income (expense), net 2,928 3,322 Loss before income taxes (28,157) (30,771) Provision for income taxes (189) (260) Net loss $ (28,346) $ (31,031) ______________ (1) Includes stock-based compensation expense as follows: Year Ended December 31, 2024 2023 (in thousands) Cost of revenue $ 1,014 $ 971 Sales and marketing 6,582 4,233 Research and development 8,374 5,590 General and administrative 16,250 12,029 Total stock-based compensation $ 32,220 $ 22,823 See Note 12 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details on stock-based compensation expense. 63 Table of Contents The following table sets forth our consolidated statements of operations data expressed as a percentage of revenue for the periods indicated: Year Ended December 31, 2024 2023 (percentage of total revenue) Revenue 100 % 100 % Cost of revenue 29 32 Gross margin 71 68 Operating expenses: Sales and marketing 41 42 Research and development 20 20 General and administrative 26 27 Total operating expenses 87 88 Loss from operations (15) (20) Other income (expense): Interest income 1 1 Interest expense (1) (1) Other income (expense), net 1 2 Loss before income taxes (14) (18) Provision for income taxes — — Net loss (14) % (18) % Comparison of the Years Ended December 31, 2024 and December 31, 2023 Revenue Year Ended December 31, Change 2024 2023 Amount Percentage (dollars in thousands) Revenue $ 204,314 $ 170,468 $ 33,846 20 % Revenue increased by $33.8 million, or 20%, for the year ended December 31, 2024 compared to the year ended December 31, 2023.
GRR reflects the effect of customer locations that terminate their subscriptions, but does not reflect changes in revenue due to revenue expansion, revenue contraction, or addition of new customer locations.
GRR reflects the effect of customer locations that terminate their subscriptions, but does not reflect changes in revenue due to revenue expansion, revenue contraction, or the addition of new customer locations.
Components of Results of Operations Revenue We generate revenue primarily from recurring subscription fees charged to access our software and phone services platform, and recurring embedded lease revenue on hardware provided to customers. The majority of these subscription arrangements have contractual terms of month-to-month, with a small minority portion having contractual terms of 1-3 years.
Components of Results of Operations Revenue We generate revenue primarily from recurring subscription fees charged to access our software and phone services platform, and recurring embedded lease revenue on hardware provided to customers. The majority of these subscription arrangements have contractual month-to-month terms, with a small minority portion having contractual terms of 1-3 years.
We are also required to pay a quarterly unused line fee of 0.15% per annum of the available borrowing amount should the outstanding principal balance drop below $10.0 million (calculated based on the number of days and based on the average available borrowing amount). The line of credit is collateralized by substantially all of our assets.
We are also required to pay a quarterly unused line of credit fee of 0.15% per annum of the available borrowing amount should the outstanding principal balance drop below $10.0 million (calculated based on the number of days and based on the average available borrowing amount). The line of credit is collateralized by substantially all of our assets.
Retain and Expand Within Our Customer Base 66 Our ability to retain and increase revenue within our existing customer base is dependent upon a number of factors, including customer satisfaction with our platform and support, the sum total of the features and pricing of the alternative point solution patchwork, our ability to effectively enhance our platform by developing new applications and features and addressing additional use cases, and our ability to leverage and scale our core sales efforts and marketing capabilities to increase our penetration into our core specialty healthcare verticals.
Retain and Expand Within Our Customer Base Our ability to retain and increase revenue within our existing customer base is dependent upon a number of factors, including customer satisfaction with our platform and support, the sum total of the features and pricing of the alternative point solution patchwork, our ability to effectively enhance our platform by developing new applications and features and addressing additional use cases, and our ability to leverage and scale our core sales efforts and marketing capabilities to increase our penetration into our core specialty healthcare verticals.
In addition, we provide payment processing services and receive a revenue share from a third-party payment facilitator on transactions between our customers that utilize our payments platform and their 68 end consumers. These payment transactions are generally for services rendered at customers’ business location via credit card terminals or through several card-not-present modalities, including “Text-to-Pay” functionality.
In addition, we provide payment processing services and receive a revenue share from a third-party payment facilitator on transactions between our customers that utilize our payments platform and their end consumers. These payment transactions are generally for services rendered at customers’ business location via credit card terminals or through several card-not-present modalities, including “Text-to-Pay” functionality.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations You should read the following discussion of our financial condition and results of operations in conjunction with the financial statements and the notes thereto included elsewhere in this Annual Report on Form 10-K. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations You should read the following discussion of our financial condition and results of operations in conjunction with the consolidated financial statements and the notes thereto included elsewhere in this Annual Report on Form 10-K. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs.
Customer retention also impacts our future financial performance given its potential to drive improved gross margin. The initial onboarding costs as well as the cost of hardware, which is depreciated over three years, represent substantial cost of revenue elements during the first few years of a customer’s life.
Customer retention also impacts our future financial performance given its potential to drive improved gross margin. The initial onboarding costs as well as the cost of hardware, which is depreciated over three years, represent substantial cost of revenue elements during the initial years of a customer’s life.
Direct costs associated with providing our platform include data center and cloud infrastructure costs, payment processing costs, amortization of finance lease right-of-use assets on phone hardware provided to customers, fees to application providers, voice connectivity and messaging fees and amortization of internal-use software development costs.
Direct costs associated with providing our platform include data center and cloud infrastructure costs, payment processing costs, amortization of finance lease right-of-use assets on phone hardware provided to customers, fees and revenue shares to application providers, voice connectivity and messaging fees, and amortization of internal-use software development costs.
(2) Represents amortization of capitalized internal-use software costs. Liquidity and Capital Resources Since inception, we have financed our operations primarily through cash generated from the sale of subscriptions to our platform, and the net proceeds received from issuances of our equity securities.
(2) Represents amortization of capitalized internal-use software and cloud computing costs. Liquidity and Capital Resources Since inception, we have financed our operations primarily through cash generated from the sale of subscriptions to our platform, and the net proceeds received from issuances of our equity securities.
Indirect costs included in costs of revenue include personnel-related expenses, such as salaries, benefits, bonuses and stock-based compensation expense, of our onboarding and customer support staff. Cost of revenue also includes an allocation of overhead costs for facilities and shared IT-related expenses, including depreciation expense.
Indirect costs include personnel-related expenses, such as salaries, benefits, bonuses and stock-based compensation expense, of our onboarding and customer support staff. Cost of revenue also includes an allocation of overhead costs for facilities and shared IT-related expenses, including depreciation expense.
Refer to “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the U.S.
Refer to “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2023, which was filed with the U.S.
We believe our current cash, cash equivalents, short-term investments, and amounts available under our senior secured credit facility will be sufficient to meet our working capital and capital expenditure requirements for at least the next 12 months.
We believe our current cash, cash equivalents, short-term investments, and amounts available under our senior secured credit facility will be sufficient to meet our working capital and capital expenditure requirements for at least the next twelve months.
The associated costs, which primarily represent depreciation expense on phones financed under finance lease arrangements, are incurred over the useful lives of the phone hardware. We consider the net costs of onboarding and hardware, in addition to our sales and marketing activities, to be core elements of our customer acquisition approach.
The associated costs, which primarily represent depreciation expense on phones financed under finance lease arrangements, are incurred over the useful lives of the phone hardware, which is 36 months. We consider the net costs of onboarding and hardware, in addition to our sales and marketing activities, to be core elements of our customer acquisition approach.
While we are focused on continued growth within our core specialty healthcare verticals and adjacent healthcare markets, we continue to evaluate additional expansion opportunities. Key Business Metrics In addition to our financial information that is presented in accordance with the generally accepted accounting principles in the United States (“U.S.
While we are focused on continued growth within our core specialty healthcare verticals and adjacent healthcare markets, we continue to evaluate additional expansion opportunities. Key Business Metrics In addition to our financial information that is presented in accordance with the generally accepted accounting principles in the U.S. (“U.S.
We have not incurred any costs as a result of such indemnification obligations historically and have not accrued any liabilities related to such obligations in our consolidated financial statements as of December 31, 2023.
We have not incurred any costs as a result of such indemnification obligations historically and have not accrued any liabilities related to such obligations in our consolidated financial statements as of December 31, 2024.
Subscription and hardware fees are prepaid and customers may elect to be billed monthly or annually, with the majority of our revenue coming from those that elect to be billed monthly. To incentivize annual payments, we may offer pricing concessions that apply ratably over the twelve-month subscription plan.
Subscription and hardware fees are prepaid and 60 Table of Contents customers may elect to be billed monthly or annually, with the majority of our revenue coming from those that elect to be billed monthly. To incentivize annual payments, we may offer pricing concessions that apply ratably over the twelve-month subscription plan.
The drivers of the changes in operating assets and liabilities were a $13.3 million increase in deferred contract costs, comprised primarily of sales commissions earned on new sales, a $3.7 million decrease in operating lease liabilities from payments made, an increase to accounts receivable of $1.4 million, and an increase in prepaid expenses and other assets of $0.7 million.
The drivers of the changes in operating assets and liabilities were a $13.3 million increase in deferred contract costs, comprised primarily of sales commissions earned on new sales, a $3.7 million decrease in operating lease liabilities, an increase to accounts receivable of $1.4 million, and an increase in prepaid expenses and other assets of $0.7 million.
In this Annual Report on Form 10-K, unless otherwise specified or the context otherwise requires, “Weave,” the “Company,” “we,” “us,” and “our” refer to Weave Communications, Inc. and its consolidated subsidiaries. 64 We have elected to omit discussion of the earliest of the three years presented in the Consolidated Financial Statements of this Annual Report on Form 10-K.
In this Annual Report on Form 10-K, unless otherwise specified or the context otherwise requires, “Weave,” the “Company,” “we,” “us,” and “our” refer to Weave Communications, Inc. and its consolidated subsidiaries. 56 Table of Contents We have elected to omit discussion of the earliest of the three years presented in the Consolidated Financial Statements of this Annual Report on Form 10-K.
Recently Adopted Accounting Pronouncements For more information, see the sections titled “Basis of Presentation and Summary of Significant Accounting Policies—Accounting Pronouncements Adopted” and “—Accounting Pronouncements Pending Adoption” in Note 2 of our consolidated financial statements in Part II, Item 8, "Financial Statements and Supplementary Data" in this Annual Report on Form 10-K.
Recently Adopted Accounting Pronouncements For more information, see the sections titled “Basis of Presentation and Summary of Significant Accounting Policies—Accounting Pronouncements Adopted” and “—Accounting Pronouncements 71 Table of Contents Pending Adoption” in Note 2 to our consolidated financial statements in Part II, Item 8, "Financial Statements and Supplementary Data" in this Annual Report on Form 10-K.
Securities and Exchange Commission (“SEC”) on March 16, 2023, for year-over-year comparisons of the results of operation between the year ended December 31, 2022 and December 31, 2021 as well as a discussion of 2021 performance metrics and cash flow activity, all of which are incorporated herein by reference.
Securities and Exchange Commission (“SEC”) on March 13, 2024, for year-over-year comparisons of the results of operation between the year ended December 31, 2023 and December 31, 2022 as well as a discussion of 2022 performance metrics and cash flow activity, all of which are incorporated herein by reference.
Our gross margin improvement is derived from a favorable customer mix as a greater portion of our customers had fully depreciated phone hardware, and from reductions in third-party costs incurred for specific platform features and overall data usage as part of our cost management efforts.
Our gross margin improvement is derived from a favorable customer mix as a greater portion of our customers had fully depreciated phone hardware, and from efficiencies with third-party costs incurred for specific platform features and overall data usage as part of our cost management efforts.
Sustaining our growth requires continued adoption of our platform by new customers. We aim to add new customers through a combination of unpaid channels, such as recommendations and word of mouth, and paid channels, such as digital marketing, direct mail, professional events, brand marketing and our teams of sales representatives.
Sustaining our growth requires continued adoption of our platform by new customers. We aim to add new customers through a combination of unpaid channels, such as recommendations and word of mouth, and paid channels, such as digital marketing, direct mail, trade shows and industry events, brand marketing and our teams of sales representatives.
We generate revenue primarily from recurring subscription fees charged to access our platform, which also include recurring hardware fees. These recurring revenues accounted for 92% and 95% of our revenue for the years ended December 31, 2023 and 2022, respectively.
We generate revenue primarily from recurring subscription fees charged to access our platform, which also include recurring hardware fees. These recurring revenues accounted for 92% of our revenue for each of the years ended December 31, 2024 and 2023, respectively.
GAAP financial measures and the reconciliations of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures and to not rely on any single financial measure to evaluate our business. 75 Free Cash Flow and Free Cash Flow Margin U.S.
GAAP financial measures and the reconciliations of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures and to not rely on any single financial measure to evaluate our business. 67 Table of Contents Free Cash Flow and Free Cash Flow Margin U.S.
The deployment of the Weave phone system as part of the platform at each of our customers increases stickiness and customer loyalty. Historically, our subscriptions have provided our new customers with immediate access to the majority of our products and functionality.
The deployment of the Weave phone system as part of the platform at each of our customers improves retention and customer loyalty. Historically, our subscriptions have provided our new customers with immediate access to the majority of our products and functionality.
We believe our disaggregated revenue and cost of revenue financial data, particularly our subscription and payment processing gross margin, provide insight into the impact of customer retention on overall gross margin improvement. Our subscription and payment processing gross margin was 77% and 74% for the years ended December 31, 2023 and 2022.
We believe our disaggregated revenue and cost of revenue financial data, particularly our subscription and payment processing gross margin, provide insight into the impact of customer retention on overall gross margin improvement. Our subscription and payment processing gross margin was 78% and 77% for the years ended December 31, 2024 and 2023, respectively.
GAAP”), we review several operating and financial metrics, including the following key metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions.
GAAP”), we review several operating and financial metrics, 59 Table of Contents including the following key metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions.
This agreement includes financial covenants requiring that, at any time, if our total unrestricted cash and cash equivalents held at SVB, plus our short-term investments managed by SVB, is less than $100.0 million, we must at all times thereafter maintain a consolidated minimum $20.0 million in liquidity, meaning unencumbered cash and short-term investments plus available borrowing on the line of credit, and that we meet specified minimum levels of EBITDA, as adjusted for stock-based compensation and changes in our deferred revenue.
The August 2021 Agreement, as amended in March 2024, includes financial covenants requiring that, at any time, if our total unrestricted cash and cash equivalents held at SVB, plus our short-term investments managed by SVB, is less than $100 million, we must at all times thereafter maintain a consolidated minimum $20 million in liquidity, meaning unencumbered cash and short-term investments plus available borrowing on the line of credit, and that we are required to meet specified minimum levels of EBITDA, as adjusted for stock-based compensation and changes in our deferred revenue.
See below for a description of these non-GAAP 74 financial measures, reconciliations of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures and their limitations as an analytical tool.
See below for a description of these non-GAAP 66 Table of Contents financial measures, reconciliations of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measures and their limitations as an analytical tool.
Deferred revenue consists of the unearned portion of billed fees for our subscriptions, which is recorded as revenue over the subscription term. We had $38.9 million of deferred revenue recorded as a current liability as of December 31, 2023. This deferred revenue will be recognized as revenue when all of the revenue recognition criteria are met.
Deferred revenue consists of the unearned portion of billed fees for our subscriptions, which is recorded as revenue over the subscription term. We had $40.0 million of deferred revenue recorded as a current liability as of December 31, 2024. This deferred revenue will be recognized as revenue when all of the revenue recognition criteria are met.
For stock options, the ESPP, and RSUs, the related stock-based compensation is recognized in the consolidated statements of operations using the straight-line attribution method. We recognize stock-based compensation expense over the requisite service period, which is the vesting period of the respective awards. Forfeitures are accounted for when they occur.
For stock options, the ESPP, and RSUs, the related stock-based compensation is recognized in the consolidated statements of operations using the straight-line attribution method. We recognize stock-based compensation expense over the requisite service period, which is the vesting period of the respective awards.
We would cease to be an emerging growth company if we have more than $1.235 billion in annual revenue, we have more than $700.0 million in market value of our stock held by non-affiliates (and we have been a public company for at least 12 months and have filed at least one annual report on Form 10-K) or we issue more than $1.0 billion of non-convertible debt securities over a three-year period.
We would cease to be an emerging growth company if we have more than $1.235 billion in annual revenue, we have more than $700.0 million in market value of our stock held by non-affiliates on the last day of the second fiscal quarter of any given fiscal year (and we have been a public company for at least twelve months and have filed at least one annual report on Form 10-K) or we issue more than $1.0 billion of non-convertible debt securities over a three-year period.
However, we have added additional add-on products in recent years, such as Weave Payments, which we are increasingly successful at cross-selling to our customer base. We intend to continue to invest in enhancing awareness of our platform, creating additional use cases, and developing more products, features and functionality.
However, we have released additional add-on products in recent years, such as Bulk Texting and Forms, which we are increasingly successful at cross-selling to our customer base. We intend to continue to invest in enhancing awareness of our platform, creating additional use cases, and developing more products, features and functionality.
Attract New Customers Our ability to attract new customers is dependent upon a number of factors, including the effectiveness of our pricing and products, the sum total of the features and pricing of the alternative point solution patchwork, the effectiveness of our marketing efforts, the effectiveness of our channel partners in selling and marketing our platform and the growth of the market for a customer experience and payments software platform.
Attract New Customers Our ability to attract new customers is dependent upon a number of factors, including the effectiveness of our pricing and products, the sum total of the features and pricing of the alternative point solution patchwork, the effectiveness of our marketing efforts, the effectiveness of our channel partners in selling and marketing our platform, our ability to integrate our platform with PMS, which strengthens our product market fit and increases the value our platform provides to customers, and the growth of the market for a customer experience and payments software platform.
However, our cost of revenue has been and will continue to be affected by a number of factors including increased regulatory fees on texting and phone calls, the quantity and aging of phones provided to customers, our stock-based compensation expense, and the timing of the amortization of internal-use software development costs, which could cause it to fluctuate as a percentage of revenue in future periods.
However, our cost of revenue has been and will continue to be affected by a number of factors, including increased regulatory fees on text messaging and phone calls, the quantity and aging of phones provided to customers, changes to fees paid to application providers, adoption of AI-based features, future changes to the cloud infrastructure costs to support AI-based features, our stock-based compensation expense, and the timing of the amortization of internal-use software development costs, which could cause it to fluctuate as a percentage of revenue in future periods.
As of December 31, 2023, our principal sources of liquidity were cash held as deposits in financial institutions and cash equivalents consisting of highly liquid investments in money market securities of $50.8 million, as well as $58.1 million in other short-term investments comprised primarily of treasury and commercial paper instruments. 76 A substantial source of cash inflow from operating activities is our deferred revenue, which is included on our consolidated balance sheets as a liability.
As of December 31, 2024, our principal sources of liquidity were cash held as deposits in financial institutions and cash equivalents consisting of highly liquid investments in money market securities of $51.6 million, as well as $47.5 million in other short-term investments comprised primarily of treasury and commercial paper instruments. 68 Table of Contents A substantial source of our cash inflow from operating activities is our deferred revenue, which is included on our consolidated balance sheets as a liability.
Silicon Valley Bank Credit Facility In August 2021, we established a revolving line of credit with Silicon Valley Bank (“SVB”) allowing for total borrowing capacity up to $50.0 million. The borrowing capacity is subject to reduction should we fail to meet certain metrics for recurring revenue and customer retention.
Silicon Valley Bank Credit Facility In August 2021, we established a revolving line of credit with SVB with total borrowing capacity up to $50.0 million, subject to reduction should we fail to meet certain metrics for recurring revenue and customer retention (the “August 2021 Agreement”). The line of credit, as amended, matures in August 2025.
Changes in the assumptions, which are subjective and generally require significant analysis and judgment to develop, can materially affect the valuation of our equity awards and impact how much stock-based compensation expense is recognized.
Forfeitures are accounted for when they occur. 70 Table of Contents Changes in the assumptions, which are subjective and generally require significant analysis and judgment to develop, can materially affect the valuation of our equity awards and impact how much stock-based compensation expense is recognized.
December 31, 2023 2022 Number of locations (at period end) 31,002 27,193 Dollar-based net retention rate 95 % 99 % Dollar-based gross retention rate 92 % 94 % 67 Number of Customer Locations We believe the number of customer locations for each year provides us an indicator of our market penetration, the growth of our business and our potential future business opportunities.
December 31, 2024 2023 Number of locations (at period end) 34,997 31,002 Dollar-based net retention rate 98 % 95 % Dollar-based gross retention rate 91 % 92 % Number of Customer Locations We believe the number of customer locations for each year provides us an indicator of our market penetration, the growth of our business and our potential future business opportunities.
Our depreciation adjustment has included depreciation on operating fixed assets and has not included amortization of finance lease right-of-use assets on phone hardware provided to our customers. Our amortization adjustment has included the amortization of capitalized internal-use software costs. We further adjust EBITDA to exclude stock-based compensation expense, a non-cash item.
Our depreciation adjustment includes depreciation on operating fixed assets and we do not adjust for amortization of finance lease right-of-use assets on phone hardware provided to our customers. Our amortization adjustment includes the amortization of capitalized costs from both internal-use software development and cloud computing arrangements. We further adjust EBITDA to exclude stock-based compensation expense, a non-cash item.
We have generated losses from our operations as reflected in our accumulated deficit of $262.7 million as of December 31, 2023 and, prior to 2023, have generated negative cash flows from operating activities.
We have generated losses from our operations as reflected in our accumulated deficit of $291.0 million as of December 31, 2024 and, prior to 2023, have generated negative cash flows from operations.
The drivers of the changes in operating assets and liabilities were a $12.3 million increase in deferred contract costs, comprised primarily of sales commissions earned on new sales, a $2.5 million decrease in operating lease liabilities from payments made, an increase in prepaid expenses and other assets of $0.1 million, an increase to accounts receivable of $1.0 million, and an increase of $0.3 million to accounts payable.
The drivers of the changes in operating assets and liabilities were a $15.3 million increase in deferred contract costs, comprised primarily of sales commissions earned on new sales, a $4.0 million decrease in operating lease liabilities from payments made, a decrease to accounts receivable of $2.1 million, and a decrease in accrued liabilities of $0.9 million.
We also increased demand generation expenses by $1.9 million, particularly with our direct-mail and digital media efforts. In addition, we incurred $1.4 million in additional event-related costs due to increased in-person trade show attendance.
We also increased demand generation expenses by $4.6 million, particularly with our digital media, partner marketing, and third party advertisement efforts. In addition, we incurred $1.5 million in additional event-related costs due to increased in-person trade show attendance.
Research and Development Year Ended December 31, Change 2023 2022 Amount Percentage (dollars in thousands) Research and development $ 34,040 $ 30,714 $ 3,326 11 % The increase in research and development expenses was due to an increase of $3.3 million in personnel-related expenses, largely from salary adjustments and stock-based compensation, for employees enhancing our platform infrastructure and developing new product offerings.
Research and Development Year Ended December 31, Change 2024 2023 Amount Percentage (dollars in thousands) Research and development $ 40,231 $ 34,040 $ 6,191 18 % The increase in research and development expenses was due to an increase of $6.2 million in personnel-related expenses, largely from salary adjustments and stock-based compensation related to grants for the new and existing employees enhancing our platform infrastructure and developing new product offerings.
As of December 31, 2023 and 2022, approximately 39% and 41% of customer locations elected annual prepayments, respectively. Subscription revenue is recognized ratably over the term of the subscription agreement. Amounts billed in excess of revenue recognized are deferred.
As of December 31, 2024 and 2023, approximately 34% and 39% of customer locations elected annual prepayments, respectively. Subscription revenue is recognized ratably over the term of the subscription agreement. Amounts billed in excess of revenue recognized are reported in deferred revenue on the Company’s consolidated balance sheets.
The following table shows a summary of our cash flows for the periods presented: Year Ended December 31, 2023 2022 (in thousands) Net cash provided by (used in) operating activities $ 10,221 $ (12,766) Net cash used in investing activities (7,739) (54,026) Net cash used in financing activities (13,723) (7,207) Operating Activities For the year ended December 31, 2023, cash provided by operating activities was $10.2 million, primarily consisting of our net loss of $31.0 million adjusted for non-cash charges of $49.3 million, and net cash outflows of $8.1 million provided by changes in our operating assets and liabilities.
The following table shows a summary of our cash flows for the periods presented: Year Ended December 31, 2024 2023 (in thousands) Net cash provided by operating activities $ 14,149 $ 10,221 Net cash provided by (used in) investing activities 8,882 (7,739) Net cash used in financing activities (22,191) (13,723) Operating Activities For the year ended December 31, 2024, cash provided by operating activities was $14.1 million, primarily consisting of our net loss of $28.3 million adjusted for non-cash charges of $60.8 million, and net cash outflows of $18.3 million provided by changes in our operating assets and liabilities.
Additionally, we purchased $1.7 million in furniture, equipment and leasehold improvements, and capitalized $2.0 million of personnel-related costs as internal-use software development. Cash used in investing activities for the year ended December 31, 2022 was $54.0 million, primarily due to $50.9 million in purchases of short-term investments.
Additionally, we purchased $2.2 million in furniture, equipment and leasehold improvements, and capitalized $1.6 million of personnel-related costs as internal-use software development. Cash used in investing activities for the year ended December 31, 2023 was $7.7 million, primarily due to $66.2 million in purchases of short-term investments which were partially offset by $62.2 million of maturities of short-term investments.
For the year ended December 31, 2022, cash used in operating activities was $12.8 million, primarily consisting of our net loss of $49.7 million adjusted for non-cash charges of $46.8 million, and net cash outflows of $9.9 million provided by changes in our operating assets and liabilities.
For the year ended December 31, 2023, cash provided by operating activities was $10.2 million, primarily consisting of our net loss of $31.0 million adjusted for non-cash charges of $49.3 million, and net cash outflows of $8.1 million provided by changes in our operating assets and liabilities.
GAAP Reconciliation Year Ended December 31, 2023 2022 (dollars in thousands) Net loss $ (31,031) $ (49,738) Interest expense 1,923 1,441 Provision for income taxes 260 104 Interest income (2,196) (1,155) Other income/expense, net (3,322) (356) Depreciation (1) 2,441 2,609 Amortization (2) 1,256 1,140 Stock-based compensation 22,823 18,752 Adjusted EBITDA $ (7,846) $ (27,203) ______________ (1) Does not include amortization of finance lease right-of-use assets on phone hardware provided to our customers.
GAAP Reconciliation Year Ended December 31, 2024 2023 (dollars in thousands) Net loss $ (28,346) $ (31,031) Interest expense 1,523 1,923 Provision for income taxes 189 260 Interest income (1,851) (2,196) Other income/expense, net (2,928) (3,322) Depreciation (1) 2,189 2,441 Amortization (2) 1,542 1,256 Stock-based compensation 32,220 22,823 Adjusted EBITDA $ 4,538 $ (7,846) ______________ (1) Does not include amortization of finance lease right-of-use assets on phone hardware provided to our customers.
Additionally, we purchased $1.9 million in furniture, equipment and leasehold improvements, and capitalized $1.2 million of personnel-related costs as internal-use software development. 77 Financing Activities Cash used in financing activities for the year ended December 31, 2023 was $13.7 million, due to $10.4 million from payments made for taxes related to the net share settlement of equity awards, $10.0 million from principal payments made on our line of credit, and $7.5 million from principal payments made on finance lease obligations.
Cash used in financing activities for the year ended December 31, 2023 was $13.7 million, due to $10.4 million from payments made for taxes related to the net share settlement of equity awards, $10.0 million from principal payments made on our line of credit, and $7.5 million from principal payments made on finance lease obligations.
In November 2023, the $10.0 million balance with SVB was repaid 79 prior to its maturity. As of December 31, 2023, there was no outstanding balance on the line of credit, the full $50.0 million was available for borrowing, and we were in compliance with all SVB loan covenants.
As of December 31, 2024, there was no outstanding balance on the line of credit, the maximum borrowing capacity of $50.0 million was available to the Company, and we were in compliance with all SVB loan covenants.
In addition to pursuing continued customer growth among small businesses, we intend to pursue opportunities to expand our customer base among medium-sized businesses, with a particular focus on our core specialty healthcare verticals. Our ability to expand among medium-sized businesses will depend upon our ability to successfully sell our platform to multi-location organizations and effectively retain them.
In addition to pursuing continued customer growth among small businesses, we intend to pursue opportunities to expand our customer base among medium-sized businesses, with a particular focus on our core specialty healthcare verticals.
Year Ended December 31, 2023 2022 (dollars in thousands) Net cash provided by (used in) operating activities $ 10,221 $ (12,766) Net cash used in investing activities $ (7,739) $ (54,026) Net cash used in financing activities $ (13,723) $ (7,207) Free cash flow $ 6,531 $ (15,893) Net cash provided by (used in) operating activities as a percentage of revenue 6 % (9) % Free cash flow margin 4 % (11) % Net loss $ (31,031) $ (49,738) Adjusted EBITDA $ (7,846) $ (27,203) Free Cash Flow and Free Cash Flow Margin We define free cash flow as net cash provided by (used in) operating activities, less purchases of property and equipment and capitalized internal-use software costs, and free cash flow margin as free cash flow as a percentage of revenue.
Year Ended December 31, 2024 2023 (dollars in thousands) Net cash provided by operating activities $ 14,149 $ 10,221 Net cash provided by (used in) investing activities $ 8,882 $ (7,739) Net cash used in financing activities $ (22,191) $ (13,723) Free cash flow $ 10,364 $ 6,531 Net cash provided by operating activities as a percentage of revenue 7 % 6 % Free cash flow margin 5 % 4 % Net loss $ (28,346) $ (31,031) Adjusted EBITDA $ 4,538 $ (7,846) Free Cash Flow and Free Cash Flow Margin We define free cash flow as net cash provided by operating activities, less purchases of property and equipment and capitalized internal-use software costs, and free cash flow margin as free cash flow as a percentage of revenue.
Interest Expense Interest expense results primarily from interest payments on our borrowings and interest on finance lease obligations. Interest on borrowings is based on a floating per annum rate at specified percentages above the prime rate. Interest on finance leases initiated prior to January 1, 2022 is based on our incremental borrowing rate at the time the agreements were initiated.
Interest Expense Interest expense results primarily from interest payments on our borrowings and interest on finance lease obligations. Interest on borrowings is based on a floating per annum rate at specified percentages above the prime rate. Interest on finance leases is based on the rate implicit within the lease agreement.
GAAP Reconciliation Year Ended December 31, 2023 2022 (dollars in thousands) Revenue $ 170,468 $ 142,117 Net cash provided by (used in) operating activities $ 10,221 $ (12,766) Less: Purchase of property and equipment (1,691) (1,895) Less: Capitalized internal-use software (1,999) (1,232) Free cash flow $ 6,531 $ (15,893) Net cash used in investing activities $ (7,739) $ (54,026) Net cash used in financing activities $ (13,723) $ (7,207) Net cash used in operating activities as a percentage of revenue 6 % (9) % Free cash flow margin 4 % (11) % Adjusted EBITDA U.S.
GAAP Reconciliation Year Ended December 31, 2024 2023 (dollars in thousands) Revenue $ 204,314 $ 170,468 Net cash provided by operating activities $ 14,149 $ 10,221 Less: Purchase of property and equipment (2,185) (1,691) Less: Capitalized internal-use software costs (1,600) (1,999) Free cash flow $ 10,364 $ 6,531 Net cash provided by (used in) investing activities $ 8,882 $ (7,739) Net cash used in financing activities $ (22,191) $ (13,723) Net cash provided by operating activities as a percentage of revenue 7 % 6 % Free cash flow margin 5 % 4 % Adjusted EBITDA U.S.
The table below sets forth the revenue and associated cost of revenue for our recurring subscription and payment processing services, as well as for our onboarding services and phone hardware: 65 Year Ended December 31, 2023 2022 (dollars in thousands) Subscription and payment processing: Revenue $ 162,715 $ 136,592 Cost of revenue (38,194) (35,008) Gross profit $ 124,521 $ 101,584 Gross margin 77 % 74 % Onboarding: Revenue $ 3,232 $ 1,288 Cost of revenue (8,710) (9,612) Gross profit $ (5,478) $ (8,324) Gross margin (169) % (646) % Hardware: Revenue $ 4,521 $ 4,237 Cost of revenue (1) (7,473) (8,656) Gross profit (1) $ (2,952) $ (4,419) Gross margin (65) % (104) % ______________ (1) Cost of revenue related to hardware represents depreciation of phone hardware over a 3-year useful life.
The table below sets forth the revenue and associated cost of revenue for our recurring subscription and payment processing services, as well as for our onboarding services and phone hardware: 57 Table of Contents Year Ended December 31, 2024 2023 (dollars in thousands) Subscription and payment processing: Revenue $ 196,106 $ 162,715 Cost of revenue (43,567) (38,194) Gross profit $ 152,539 $ 124,521 Gross margin 78 % 77 % Onboarding: Revenue $ 3,547 $ 3,232 Cost of revenue (7,793) (8,710) Gross profit $ (4,246) $ (5,478) Gross margin (120) % (169) % Hardware: Revenue $ 4,661 $ 4,521 Cost of revenue (1) (7,072) (7,473) Gross profit $ (2,411) $ (2,952) Gross margin (52) % (65) % ______________ (1) Cost of revenue related to hardware represents depreciation of phone hardware over a 3-year useful life.
The majority of our customers are dental, optometry, veterinary and other medical specialty practices, and through investment in our product development and integrations we are expanding our platform services to support several additional specialized medical verticals.
Weave seamlessly integrates billing and payment requests into communication workflows, streamlining payment timelines, reducing accounts receivable, and supporting practice profitability. The majority of our customers are dental, optometry, veterinary and other medical specialty practices, and through investment in our product development and integrations we are expanding our platform services to support several additional specialized medical verticals.
We expect our future success in winning new clients to be partially driven by our ability to continue to develop and deliver new, innovative products to SMBs in a timely manner.
The depth of our platform’s functionality is dependent upon both our internally-developed technology and our platform partnerships and integrations. We expect our future success in winning new clients to be partially driven by our ability to continue to develop and deliver new, innovative products to SMBs in a timely manner.
Provision for (Benefit from) Income Taxes Provision for income taxes consists primarily of income taxes related to foreign and state jurisdictions in which we conduct business.
Other Income (Expense), Net Other income (expense), net primarily consists of gains and losses on short-term investments, foreign currency transactions, and sublease income. Provision for (Benefit from) Income Taxes Provision for income taxes consists primarily of income taxes related to foreign and state jurisdictions in which we conduct business.
We also paid $0.7 million in offering costs related to our IPO in November 2021. These cash outflows were partially offset by $1.3 million in proceeds received from employee stock option exercises, and proceeds of $0.9 million received from our employee stock purchase plan.
These cash outflows were partially offset by $2.0 million received from our employee stock purchase plan and $1.7 million in proceeds received from employee stock option exercises.
Of the total increase, approximately $19.1 million, or 67%, was attributable to new customer locations acquired during the year ended December 31, 2023, and $9.2 million, or 33%, was attributable to existing customer locations under subscription as of December 31, 2022. Customer locations totaled 31,002 and 27,193 as of December 31, 2023 and 2022, respectively.
Of the total increase, approximately $20.0 million, or 59%, was attributable to new customer locations acquired during the year ended December 31, 2024, and $13.8 million, or 41%, was attributable to existing customer locations under subscription as of December 31, 2023. Customer locations totaled 34,997 and 31,002 as of December 31, 2024 and 2023, respectively.
Entering a new industry vertical includes establishing key partnerships as well as identifying, evaluating, developing, and launching a platform solution with vertical-specific functionality that is integrated with the primary systems of record in that vertical. We started in dental and have since successfully expanded to optometry and veterinary, among other areas.
Entering a new industry vertical includes evaluating product-market fit and establishing key integration partnerships with the primary systems of record in that vertical. We started in dental and have since successfully expanded to optometry, veterinary and other specialty medical verticals.
Sales and Marketing Year Ended December 31, Change 2023 2022 Amount Percentage (dollars in thousands) Sales and marketing $ 70,765 $ 65,378 $ 5,387 8 % The increase in sales and marketing expenses was attributable in part to an increase of $2.1 million in personnel-related expenses, driven largely by salary and commission plan adjustments, and stock-based compensation.
Sales and Marketing Year Ended December 31, Change 2024 2023 Amount Percentage (dollars in thousands) Sales and marketing $ 84,612 $ 70,765 $ 13,847 20 % The increase in sales and marketing expenses was attributable in part to an increase of $7.8 million in personnel-related expenses, driven largely by salary and commission plan adjustments and stock-based compensation related to grants for new and existing employees and executives, as well as an increase in average stock price over the period.
Historically, our go-to-market strategy focused on increasing the number of locations with most of our customers having a single location; however, we now provide multi-office functionality on our platform to allow us to better service organizations with multiple locations.
Historically, our go-to-market strategy focused on increasing the number of locations with most of our customers having a single location.
Cost of Revenue and Gross Margin Year Ended December 31, Change 2023 2022 Amount Percentage (dollars in thousands) Cost of revenue $ 54,377 $ 53,276 $ 1,101 2 % Gross margin 68 % 63 % The increase in cost of revenue was due primarily to an increase of $0.6 million in personnel-related costs, particularly related to merit increases and new hires, and a $0.5 million increase in direct costs to 72 support customer usage and growth of our customer base, including cloud infrastructure costs and fees paid to application providers.
Cost of Revenue and Gross Margin Year Ended December 31, Change 2024 2023 Amount Percentage (dollars in thousands) Cost of revenue $ 58,432 $ 54,377 $ 4,055 7 % Gross margin 71 % 68 % The increase in cost of revenue was due primarily to an increase of $3.2 million in direct costs to support customer usage and growth of our customer base, including cloud infrastructure costs, fees paid 64 Table of Contents to application providers, and connectivity and messaging costs.
General and Administrative Year Ended December 31, Change 2023 2022 Amount Percentage (dollars in thousands) General and administrative $ 45,652 $ 42,453 $ 3,199 8 % The increase in general and administrative expenses was primarily due to a $4.7 million increase in personnel-related expenses, particularly from additional bonus incentives, salary adjustments, and stock-based compensation.
General and Administrative Year Ended December 31, Change 2024 2023 Amount Percentage (dollars in thousands) General and administrative $ 52,452 $ 45,652 $ 6,800 15 % The increase in general and administrative expenses was primarily due to a $5.6 million increase in personnel-related expenses, particularly from salary adjustments and stock-based compensation related to grants for new and existing employees and executives.
Provision for Income Taxes Year Ended December 31, Change 2023 2022 Amount Percentage (dollars in thousands) Provision for income taxes $ (260) $ (104) $ (156) 150 % Provision for income taxes increased by an immaterial amount due to increases in operations and other expenses in our foreign jurisdictions.
Provision for Income Taxes Year Ended December 31, Change 2024 2023 Amount Percentage (dollars in thousands) Provision for income taxes $ (189) $ (260) $ 71 (27) % Income tax expenses decreased by an immaterial amount due to one-time tax adjustments in our foreign jurisdictions.
Financial Statements and Supplementary Data” of this Annual Report on Form 10-K, the following accounting policies involve a greater degree of judgment and complexity. Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our consolidated financial condition, results of operations, and cash flows.
Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our consolidated financial condition, results of operations, and cash flows.
Our platform is software-driven, and its research and development teams employ software engineers in the continuous testing, certification and support of our platform and products. Accordingly, the majority of our research and development expenses result from employee-related costs, including salaries, benefits, bonuses, stock-based compensation and costs associated with technology tools used by our engineers.
Accordingly, the majority of our research and development expenses result from employee-related costs, including salaries, benefits, bonuses, stock-based compensation and costs associated with technology tools used by our engineers. We expect that our research and development expenses will increase as our business grows, particularly as we incur additional costs related to continued investments in our platform and products.
The increase in interest income is due to interest generated on our money market securities. The increase in other income (expense), net is largely due to realized gains on our short-term investments and, to a lesser extent, a rise in average interest rates over the period contributed to increases both interest and other income.
The decrease in other income (expense), net is largely due to realized losses on our short-term investments and, to a lesser extent, a decrease in average interest rates over the period which contributed to the decrease in other income. In addition, Other income (expense), net for 2024 includes income from our office space sublease arrangement.
To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations, and cash flows will be affected. We believe that of our significant accounting policies, which are described in Note 2 to our consolidated financial statements included in “Part II, Item 8.
Our actual results could differ from these estimates. To the extent that there are differences between our estimates and actual results, our future financial statement presentation, financial condition, results of operations, and cash flows will be affected.
In addition, research and development expenses that qualify as internal-use software development costs are capitalized and the amount capitalized may fluctuate significantly from period to period. General and Administrative General and administrative expenses consist primarily of personnel-related expenses for our finance, legal, human resources, facilities and administrative personnel, including salaries, benefits, bonuses and stock-based compensation.
General and Administrative General and administrative expenses consist primarily of personnel-related expenses for our finance, legal, human resources, facilities and administrative personnel, including salaries, benefits, bonuses, and stock-based compensation.
Add New Products We continue to add new products and functionality to our platform, broadening our use cases and applicability for different customers. Our ability to cohesively deliver a deep product suite with as little friction as possible to customers is a key determinant of winning new customers.
Our ability to cohesively deliver a deep product suite with as little friction as possible to customers is a key determinant of winning new customers. Our ability to add new SMB customers is dependent on the features and functionality we add to our platform, including those enabled by AI, particularly in our core specialty healthcare verticals.
These amounts were partially offset by a $4.6 million increase in deferred revenue due to our prepay arrangements with our customers, and a $1.8 million increase in accrued liabilities. Investing Activities Cash used in investing activities for the year ended December 31, 2023 was $7.7 million, primarily due to $66.2 million in purchases of short-term investments.
Investing Activities Cash provided by investing activities for the year ended December 31, 2024 was $8.9 million, primarily due to $66.4 million of maturities of short-term investments, which were partially offset by $53.8 million in purchases of short-term investments.
Other Income (Expense), Net Year Ended December 31, Change 2023 2022 Amount Percentage (dollars in thousands) Interest income $ 2,196 $ 1,155 Interest expense (1,923) (1,441) Other income (expense), net 3,322 356 Total other income (expense), net $ 3,595 $ 70 $ 3,525 5036 % The increase in interest expense is due to increased average interest rates over the period, which increased the variable interest paid on our credit facility.
Other Income (Expense), Net Year Ended December 31, Change 2024 2023 Amount Percentage (dollars in thousands) Interest income $ 1,851 $ 2,196 Interest expense (1,523) (1,923) Other income, net 2,928 3,322 Total other income (expense), net $ 3,256 $ 3,595 $ (339) (9) % The decrease in interest expense is due primarily to the payoff of our revolving line of credit in November of 2023, which resulted in no interest paid for our credit facility in the year ended December 31, 2024.
We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our actual results could differ from these estimates.
The preparation of our consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses and related disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances.
These cash outflows were partially offset by $12.9 million in proceeds received from employee stock option exercises, and proceeds of $1.3 million received from our employee stock purchase plan. Cash used in financing activities for the year ended December 31, 2022 was $7.2 million, primarily due to $8.7 million from principal payments made on finance lease obligations.
Financing Activities Cash used in financing activities for the year ended December 31, 2024 was $22.2 million, due to $18.9 million from payments made for taxes related to the net share settlement of equity awards and $7.1 million from principal payments made on finance lease obligations.
These increases were partially offset by a $1.2 million decrease in our director and officer liability insurance premiums, a $1.0 73 million decrease in professional fees, and a $0.7 million increase in capitalized internal-use software costs.
We also experienced increases of $0.4 million in professional services fees, $0.7 million in bad debt expense, and $0.6 million in dues and subscription 65 Table of Contents costs. These increases were partially offset by a $0.5 million decrease in our director and officer liability insurance premiums.
As a percentage of revenue, we anticipate sales and marketing expenses to decrease in 2024 as compared to 2023, and we expect these expenses to continue to decrease as a percentage of revenue over time. 69 Research and Development Research and development expenses include software development costs that are not eligible for capitalization and support our efforts to ensure the reliability, availability and scalability of our solutions.
As a percentage of revenue, we anticipate sales and marketing expenses to decrease in 2025 as compared to 2024, and we expect these expenses to continue to decrease as a percentage of revenue over time.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

3 edited+0 added−1 removed4 unchanged
Biggest changeA small portion of our operating expenses are incurred outside the United States, denominated in foreign currencies, and subject to fluctuations due to changes in foreign currency exchange rates, particularly changes in the Canadian Dollar and the Indian Rupee.
Biggest changeA small portion of our operating expenses are incurred outside the U.S., denominated in foreign currencies, and subject to fluctuations due to changes in foreign currency exchange rates, particularly changes in the Canadian Dollar and the Indian Rupee. Additionally, fluctuations in foreign currency exchange rates may cause us to recognize transaction gains and losses in our consolidated statements of operations.
As of December 31, 2023, we had no outstanding borrowing balance on our credit facility. 80 Foreign Currency Exchange Risk The vast majority of our customer subscription agreements are denominated in U.S. dollars, with a small number of subscription agreements denominated in Canadian dollars.
As of December 31, 2024, we had no outstanding borrowing balance on our credit facility. Foreign Currency Exchange Risk The vast majority of our customer subscription agreements are denominated in U.S. dollars, with a small number of subscription agreements denominated in Canadian dollars.
As the impact of foreign currency exchange rates has not been material to our historical operating results, we have not entered into derivative or hedging transactions, but we may do so in the future if our exposure to foreign currency becomes more significant. 81
As the impact of foreign currency exchange rates has not been material to our historical operating results, we have not entered into derivative or hedging transactions, but we may do so in the future if our exposure to foreign currency becomes more significant. 72 Table of Contents
Removed
Additionally, fluctuations in foreign currency exchange rates may cause us to recognize transaction gains and losses in our consolidated statements of operations.

Other WEAV 10-K year-over-year comparisons