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x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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94- 3394123
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(State or Other Jurisdiction of
Incorporation or Organization)
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(I.R.S. Employer
Identification No.)
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Large Accelerated Filer
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o
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Accelerated Filer
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o
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Non-accelerated filer
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x
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(Do not check if a smaller reporting Company)
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Smaller Reporting Company
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o
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•
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our quarterly and annual results may fluctuate significantly, may not fully reflect the underlying performance of our business and may result in decreases in the price of our common stock;
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•
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if we are unable to attract new clients or sell additional services and functionality to our existing clients, our revenue and revenue growth will be harmed;
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•
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our recent rapid growth may not be indicative of our future growth, and even if we continue to grow rapidly, we may fail to manage our growth effectively;
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•
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the markets in which we participate are highly competitive, and if we do not compete effectively, our operating results could be harmed;
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•
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if we fail to manage our technical operations infrastructure, our existing clients may experience service outages, our new clients may experience delays in the deployment of our solution and we could be subject to, among other things, claims for credits or damages;
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•
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if our existing clients terminate their subscriptions or reduce their subscriptions and related usage, our revenues and gross margins will be harmed and we will be required to spend more money to grow our client base;
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•
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we sell our solution to larger organizations that require longer sales and implementation cycles and often demand more configuration and integration services or customized features and functions that we may not offer, any of which could delay or prevent these sales and harm our growth rates, business and operating results;
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•
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because a significant percentage of our revenue is derived from existing clients, downturns or upturns in new sales will not be immediately reflected in our operating results and may be difficult to discern;
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•
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we rely on third-party telecommunications and internet service providers to provide our clients and their customers with telecommunication services and connectivity to our cloud contact center software and any failure by these service providers to provide reliable services could subject us to, among other things, claims for credits or damages;
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•
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we have a history of losses and we may be unable to achieve or sustain profitability;
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•
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we may not be able to secure additional financing on favorable terms, or at all, to meet our future capital needs; and
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•
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failure to comply with laws and regulations could harm our business and our reputation.
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June 30, 2015
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December 31, 2014
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||||
ASSETS
|
|
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|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
65,333
|
|
|
$
|
58,289
|
|
Short-term investments
|
|
—
|
|
|
20,000
|
|
||
Accounts receivable, net
|
|
8,250
|
|
|
8,335
|
|
||
Prepaid expenses and other current assets
|
|
4,228
|
|
|
1,960
|
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||
Total current assets
|
|
77,811
|
|
|
88,584
|
|
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Property and equipment, net
|
|
11,964
|
|
|
12,571
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|
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Intangible assets, net
|
|
2,297
|
|
|
2,553
|
|
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Goodwill
|
|
11,798
|
|
|
11,798
|
|
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Other assets
|
|
709
|
|
|
1,428
|
|
||
Total assets
|
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$
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104,579
|
|
|
$
|
116,934
|
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|
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||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
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|
||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
2,766
|
|
|
$
|
4,179
|
|
Accrued and other current liabilities
|
|
8,718
|
|
|
7,318
|
|
||
Accrued federal fees
|
|
5,658
|
|
|
7,215
|
|
||
Sales tax liability
|
|
863
|
|
|
297
|
|
||
Notes payable
|
|
5,081
|
|
|
3,146
|
|
||
Capital leases
|
|
4,365
|
|
|
4,849
|
|
||
Deferred revenue
|
|
5,525
|
|
|
5,346
|
|
||
Total current liabilities
|
|
32,976
|
|
|
32,350
|
|
||
Revolving line of credit
|
|
12,500
|
|
|
12,500
|
|
||
Sales tax liability — less current portion
|
|
2,063
|
|
|
2,582
|
|
||
Notes payable — less current portion
|
|
21,117
|
|
|
22,778
|
|
||
Capital leases — less current portion
|
|
4,676
|
|
|
4,423
|
|
||
Other long-term liabilities
|
|
672
|
|
|
548
|
|
||
Total liabilities
|
|
74,004
|
|
|
75,181
|
|
||
Commitments and contingencies (Note 9)
|
|
|
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||||
Stockholders’ equity:
|
|
|
|
|
||||
Preferred stock, $0.001 par value; 5,000 shares authorized, no shares issued and outstanding at June 30, 2015 and December 31, 2014
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—
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|
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—
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|
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Common stock, $0.001 par value; 450,000 shares authorized, 50,246 shares and 49,322 shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively
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|
50
|
|
|
49
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|
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Additional paid-in capital
|
|
175,379
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|
|
170,286
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|
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Accumulated deficit
|
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(144,854
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)
|
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(128,582
|
)
|
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Total stockholders’ equity
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30,575
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|
|
41,753
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|
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Total liabilities and stockholders’ equity
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$
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104,579
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|
|
$
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116,934
|
|
|
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Three Months Ended
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Six Months Ended
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||||||||||||
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June 30, 2015
|
|
June 30, 2014
|
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June 30, 2015
|
|
June 30, 2014
|
||||||||
Revenue
|
|
$
|
30,274
|
|
|
$
|
24,685
|
|
|
$
|
60,548
|
|
|
$
|
48,959
|
|
Cost of revenue
|
|
14,270
|
|
|
13,469
|
|
|
29,048
|
|
|
26,617
|
|
||||
Gross profit
|
|
16,004
|
|
|
11,216
|
|
|
31,500
|
|
|
22,342
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|
||||
Operating expenses:
|
|
|
|
|
|
|
|
|
||||||||
Research and development
|
|
5,568
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|
|
5,554
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|
|
11,606
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|
|
10,779
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|
||||
Sales and marketing
|
|
10,594
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|
|
9,674
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|
|
20,525
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|
|
18,696
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|
||||
General and administrative
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6,027
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3,515
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|
|
13,302
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|
|
9,686
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|
||||
Total operating expenses
|
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22,189
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|
|
18,743
|
|
|
45,433
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|
|
39,161
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|
||||
Loss from operations
|
|
(6,185
|
)
|
|
(7,527
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)
|
|
(13,933
|
)
|
|
(16,819
|
)
|
||||
Other income (expense), net:
|
|
|
|
|
|
|
|
|
||||||||
Change in fair value of convertible preferred and common stock warrant liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,745
|
|
||||
Interest expense
|
|
(1,155
|
)
|
|
(1,092
|
)
|
|
(2,294
|
)
|
|
(1,870
|
)
|
||||
Interest income and other
|
|
(49
|
)
|
|
(28
|
)
|
|
(47
|
)
|
|
4
|
|
||||
Total other income (expense), net
|
|
(1,204
|
)
|
|
(1,120
|
)
|
|
(2,341
|
)
|
|
(121
|
)
|
||||
Loss before provision for (benefit from) income taxes
|
|
(7,389
|
)
|
|
(8,647
|
)
|
|
(16,274
|
)
|
|
(16,940
|
)
|
||||
Provision for (benefit from) income taxes
|
|
(20
|
)
|
|
12
|
|
|
(2
|
)
|
|
39
|
|
||||
Net loss
|
|
$
|
(7,369
|
)
|
|
$
|
(8,659
|
)
|
|
$
|
(16,272
|
)
|
|
$
|
(16,979
|
)
|
Net loss per share:
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted
|
|
$
|
(0.15
|
)
|
|
$
|
(0.18
|
)
|
|
$
|
(0.33
|
)
|
|
$
|
(0.64
|
)
|
Shares used in computing net loss per share:
|
|
|
|
|
|
|
|
|
||||||||
Basic and diluted
|
|
49,980
|
|
|
46,898
|
|
|
49,708
|
|
|
26,367
|
|
||||
Comprehensive Loss:
|
|
|
|
|
|
|
|
|
||||||||
Net loss
|
|
$
|
(7,369
|
)
|
|
$
|
(8,659
|
)
|
|
$
|
(16,272
|
)
|
|
$
|
(16,979
|
)
|
Other comprehensive loss:
|
|
|
|
|
|
|
|
|
||||||||
Change in unrealized gain/loss on short-term investments, net of tax
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Comprehensive loss
|
|
$
|
(7,368
|
)
|
|
$
|
(8,659
|
)
|
|
$
|
(16,272
|
)
|
|
$
|
(16,979
|
)
|
|
|
Six Months Ended
|
||||||
|
|
June 30, 2015
|
|
June 30, 2014
|
||||
Cash flows from operating activities:
|
|
|
|
|
||||
Net loss
|
|
$
|
(16,272
|
)
|
|
$
|
(16,979
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
3,685
|
|
|
3,291
|
|
||
Provision for doubtful accounts
|
|
134
|
|
|
39
|
|
||
Stock-based compensation
|
|
4,065
|
|
|
2,919
|
|
||
Loss on the disposal of property and equipment
|
|
9
|
|
|
—
|
|
||
Non-cash interest expense
|
|
171
|
|
|
129
|
|
||
Changes in fair value of convertible preferred and common stock warrant liabilities
|
|
—
|
|
|
(1,745
|
)
|
||
Others
|
|
(1
|
)
|
|
(2
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Accounts receivable
|
|
(57
|
)
|
|
(126
|
)
|
||
Prepaid expenses and other current assets
|
|
(2,268
|
)
|
|
(1,070
|
)
|
||
Other assets
|
|
(87
|
)
|
|
(55
|
)
|
||
Accounts payable
|
|
(1,394
|
)
|
|
(508
|
)
|
||
Accrued and other current liabilities
|
|
2,035
|
|
|
1,985
|
|
||
Accrued federal fees and sales tax liability
|
|
165
|
|
|
(2,808
|
)
|
||
Deferred revenue
|
|
163
|
|
|
634
|
|
||
Other liabilities
|
|
(58
|
)
|
|
(102
|
)
|
||
Net cash used in operating activities
|
|
(9,710
|
)
|
|
(14,398
|
)
|
||
Cash flows from investing activities:
|
|
|
|
|
||||
Purchases of property and equipment
|
|
(414
|
)
|
|
(336
|
)
|
||
Decrease (increase) in restricted cash
|
|
806
|
|
|
(25
|
)
|
||
Purchase of short-term investments
|
|
(20,000
|
)
|
|
(29,993
|
)
|
||
Proceeds from maturity of short-term investments
|
|
40,000
|
|
|
—
|
|
||
Net cash provided by (used in) investing activities
|
|
20,392
|
|
|
(30,354
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
||||
Net proceeds from initial public offering, net of payments for offering costs
|
|
—
|
|
|
71,459
|
|
||
Proceeds from exercise of common stock options and warrants
|
|
349
|
|
|
705
|
|
||
Proceeds from sale of common stock under ESPP
|
|
680
|
|
|
—
|
|
||
Proceeds from notes payable
|
|
—
|
|
|
19,561
|
|
||
Repayments of notes payable
|
|
(1,572
|
)
|
|
(519
|
)
|
||
Payments of capital leases
|
|
(3,095
|
)
|
|
(2,625
|
)
|
||
Net cash provided by (used in) financing activities
|
|
(3,638
|
)
|
|
88,581
|
|
||
Net increase in cash and cash equivalents
|
|
7,044
|
|
|
43,829
|
|
||
Cash and cash equivalents:
|
|
|
|
|
||||
Beginning of period
|
|
58,289
|
|
|
17,748
|
|
||
End of period
|
|
$
|
65,333
|
|
|
$
|
61,577
|
|
Non-cash investing and financing activities:
|
|
|
|
|
||||
Equipment obtained under capital lease
|
|
$
|
2,394
|
|
|
$
|
2,598
|
|
Equipment purchased and unpaid at period-end
|
|
34
|
|
|
23
|
|
||
Reclass of deferred initial public offering costs to additional paid-in capital
|
|
—
|
|
|
2,179
|
|
||
Net cashless exercise of preferred stock warrants to Series A-2 convertible preferred stock
|
|
—
|
|
|
509
|
|
||
Vesting of early exercised stock options
|
|
—
|
|
|
57
|
|
||
Reclass of warrants liabilities to additional paid-in capital upon initial public offering
|
|
—
|
|
|
2,647
|
|
||
Conversion of convertible preferred stock to common stock upon initial public offering
|
|
—
|
|
|
54,244
|
|
|
|
June 30, 2015
|
||||||
|
|
Total
|
|
Level 1
|
||||
Assets
|
|
|
|
|
||||
Cash equivalents:
|
|
|
|
|
||||
Money market funds
|
|
$
|
20,001
|
|
|
$
|
20,001
|
|
|
|
|
|
|
||||
|
|
December 31, 2014
|
||||||
|
|
Total
|
|
Level 1
|
||||
Assets
|
|
|
|
|
||||
Short-term investments:
|
|
|
|
|
||||
U.S. Treasury bills
|
|
$
|
20,000
|
|
|
$
|
20,000
|
|
|
|
June 30, 2015
|
|
December 31, 2014
|
||||
Cash
|
|
$
|
45,332
|
|
|
$
|
58,289
|
|
Money market funds
|
|
20,001
|
|
|
—
|
|
||
Cash and cash equivalents
|
|
$
|
65,333
|
|
|
$
|
58,289
|
|
|
|
June 30, 2015
|
|
December 31, 2014
|
||||
Trade accounts receivable
|
|
$
|
7,553
|
|
|
$
|
7,482
|
|
Unbilled trade accounts receivable, net of advance client deposits
|
|
768
|
|
|
918
|
|
||
Allowance for doubtful accounts
|
|
(71
|
)
|
|
(65
|
)
|
||
Accounts receivable, net
|
|
$
|
8,250
|
|
|
$
|
8,335
|
|
|
|
June 30, 2015
|
|
December 31, 2014
|
||||
Prepaid expenses
|
|
$
|
2,323
|
|
|
$
|
1,721
|
|
Canadian value-added taxes receivable
|
|
1,646
|
|
|
—
|
|
||
Others
|
|
259
|
|
|
239
|
|
||
Prepaid expenses and other current assets
|
|
$
|
4,228
|
|
|
$
|
1,960
|
|
|
|
June 30, 2015
|
|
December 31, 2014
|
||||
Computer and network equipment
|
|
$
|
26,681
|
|
|
$
|
24,292
|
|
Computer software
|
|
2,662
|
|
|
2,264
|
|
||
Furniture and fixtures
|
|
1,039
|
|
|
1,030
|
|
||
Leasehold improvements
|
|
614
|
|
|
611
|
|
||
Property and equipment
|
|
30,996
|
|
|
28,197
|
|
||
Accumulated depreciation and amortization
|
|
(19,032
|
)
|
|
(15,626
|
)
|
||
Property and equipment, net
|
|
$
|
11,964
|
|
|
$
|
12,571
|
|
|
|
June 30, 2015
|
|
December 31, 2014
|
||||
Gross
|
|
$
|
23,412
|
|
|
$
|
21,025
|
|
Less: accumulated depreciation and amortization
|
|
(13,058
|
)
|
|
(10,609
|
)
|
||
Total
|
|
$
|
10,354
|
|
|
$
|
10,416
|
|
|
|
June 30, 2015
|
|
December 31, 2014
|
||||
Accrued compensation and benefits
|
|
$
|
5,598
|
|
|
$
|
5,078
|
|
Accrued expenses
|
|
1,474
|
|
|
2,240
|
|
||
Canadian value-added taxes liability
|
|
1,646
|
|
|
—
|
|
||
Accrued and other current liabilities
|
|
$
|
8,718
|
|
|
$
|
7,318
|
|
|
|
June 30, 2015
|
|
December 31, 2014
|
||||||||||||||||||||
|
|
Gross
Carrying Amount
|
|
Accumulated
Amortization |
|
Net
Carrying Amount
|
|
Gross
Carrying Amount
|
|
Accumulated
Amortization |
|
Net
Carrying Amount
|
||||||||||||
Developed technology
|
|
$
|
2,460
|
|
|
$
|
(599
|
)
|
|
$
|
1,861
|
|
|
$
|
2,460
|
|
|
$
|
(423
|
)
|
|
$
|
2,037
|
|
Customer relationships
|
|
520
|
|
|
(177
|
)
|
|
343
|
|
|
520
|
|
|
(125
|
)
|
|
395
|
|
||||||
Domain names
|
|
50
|
|
|
(17
|
)
|
|
33
|
|
|
50
|
|
|
(12
|
)
|
|
38
|
|
||||||
Non-compete agreements
|
|
140
|
|
|
(80
|
)
|
|
60
|
|
|
140
|
|
|
(57
|
)
|
|
83
|
|
||||||
Total
|
|
$
|
3,170
|
|
|
$
|
(873
|
)
|
|
$
|
2,297
|
|
|
$
|
3,170
|
|
|
$
|
(617
|
)
|
|
$
|
2,553
|
|
Period
|
|
Expected Future Amortization Expense
|
||
Remainder of 2015
|
|
$
|
256
|
|
2016
|
|
503
|
|
|
2017
|
|
465
|
|
|
2018
|
|
442
|
|
|
2019
|
|
351
|
|
|
2020
|
|
280
|
|
|
Total
|
|
$
|
2,297
|
|
|
|
June 30, 2015
|
|
December 31, 2014
|
||||
Term loan under 2014 Loan and Security Agreement
|
|
$
|
20,000
|
|
|
$
|
20,000
|
|
Term loan under 2013 Loan and Security Agreement
|
|
3,500
|
|
|
4,500
|
|
||
Promissory note to USAC
|
|
2,068
|
|
|
2,640
|
|
||
FCC civil penalty
|
|
2,000
|
|
|
—
|
|
||
Total notes payable, gross
|
|
27,568
|
|
|
27,140
|
|
||
Less: discount
|
|
(1,370
|
)
|
|
(1,216
|
)
|
||
Total notes payable, net carrying value
|
|
26,198
|
|
|
25,924
|
|
||
Revolving line of credit, non-current
|
|
12,500
|
|
|
12,500
|
|
||
Total debt, net carrying value
|
|
$
|
38,698
|
|
|
$
|
38,424
|
|
Less: current portion of debt
|
|
(5,081
|
)
|
|
(3,146
|
)
|
||
Total debt, less current portion
|
|
33,617
|
|
|
35,278
|
|
Period
|
|
Amount to Mature
|
||
Remainder of 2015
|
|
$
|
1,942
|
|
2016
|
|
20,173
|
|
|
2017
|
|
5,286
|
|
|
2018
|
|
4,334
|
|
|
2019
|
|
8,333
|
|
|
Total
|
|
$
|
40,068
|
|
|
|
June 30, 2015
|
|
Stock options outstanding
|
|
6,775
|
|
Restricted stock units outstanding
|
|
1,526
|
|
Shares available for future grant under 2014 Plan
|
|
5,308
|
|
Shares available for future issuance under ESPP
|
|
1,058
|
|
Common stock warrants outstanding
|
|
360
|
|
Total shares of common stock reserved
|
|
15,027
|
|
|
|
Number of
Shares Outstanding |
|
Weighted
Average Exercise Price |
|
Weighted
Average
Remaining
Contractual
Life
(Years)
|
|
Aggregate
Intrinsic Value |
|||||
Outstanding as of December 31, 2014
|
|
7,164
|
|
|
$
|
4.34
|
|
|
|
|
|
||
Options granted (weighted average grant date fair value of $2.49 per share)
|
|
181
|
|
|
5.20
|
|
|
|
|
|
|||
Options exercised
|
|
(411
|
)
|
|
0.85
|
|
|
|
|
|
|||
Options forfeited or expired
|
|
(159
|
)
|
|
7.32
|
|
|
|
|
|
|||
Outstanding as of June 30, 2015
|
|
6,775
|
|
|
$
|
4.51
|
|
|
7.0
|
|
$
|
13,332
|
|
|
|
Number of Shares
|
|
Weighted Average Grant Date Fair Value Per Share
|
|||
Outstanding as of December 31, 2014
|
|
1,370
|
|
|
$
|
5.21
|
|
RSUs granted
|
|
599
|
|
|
5.13
|
|
|
RSUs vested and released
|
|
(375
|
)
|
|
6.18
|
|
|
RSUs forfeited
|
|
(68
|
)
|
|
5.25
|
|
|
Outstanding as of June 30, 2015
|
|
1,526
|
|
|
$
|
4.94
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
June 30, 2015
|
|
June 30, 2014
|
||||||||
Cost of revenue
|
|
$
|
218
|
|
|
$
|
121
|
|
|
$
|
406
|
|
|
$
|
208
|
|
Research and development
|
|
340
|
|
|
471
|
|
|
914
|
|
|
821
|
|
||||
Sales and marketing
|
|
458
|
|
|
368
|
|
|
982
|
|
|
694
|
|
||||
General and administrative
|
|
814
|
|
|
763
|
|
|
1,763
|
|
|
1,196
|
|
||||
Total stock-based compensation
|
|
$
|
1,830
|
|
|
$
|
1,723
|
|
|
$
|
4,065
|
|
|
$
|
2,919
|
|
|
|
Stock Option
|
|
RSU
|
|
ESPP
|
||||||
Unrecognized stock-based compensation expense
|
|
$
|
8,891
|
|
|
$
|
6,293
|
|
|
$
|
188
|
|
Weighted-average amortization period
|
|
2.5 years
|
|
|
3.0 years
|
|
|
0.4 years
|
|
Stock Options
|
|
Three Months Ended
|
|
Six Months Ended
|
||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
June 30, 2015
|
|
June 30, 2014
|
Expected term (years)
|
|
6.1
|
|
6.1
|
|
6.1
|
|
6.1
|
Volatility
|
|
49%
|
|
56%
|
|
49%
|
|
56%
|
Risk-free interest rate
|
|
1.5%
|
|
1.9%
|
|
1.5%
|
|
1.8%
|
Dividend yield
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
June 30, 2015
|
|
June 30, 2014
|
||||||||
Net loss
|
|
$
|
(7,369
|
)
|
|
$
|
(8,659
|
)
|
|
$
|
(16,272
|
)
|
|
$
|
(16,979
|
)
|
Weighted-average shares used in computing basic and diluted net loss per share
|
|
49,980
|
|
|
46,898
|
|
|
49,708
|
|
|
26,367
|
|
||||
Basic and diluted net loss per share
|
|
$
|
(0.15
|
)
|
|
$
|
(0.18
|
)
|
|
$
|
(0.33
|
)
|
|
$
|
(0.64
|
)
|
|
|
June 30, 2015
|
|
June 30, 2014
|
||
Stock options
|
|
6,775
|
|
|
7,145
|
|
Restricted stock units
|
|
1,526
|
|
|
262
|
|
ESPP
|
|
178
|
|
|
474
|
|
Common stock warrants
|
|
360
|
|
|
360
|
|
Common stock subject to repurchase or forfeiture
|
|
—
|
|
|
138
|
|
Total
|
|
8,839
|
|
|
8,379
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
June 30, 2015
|
|
June 30, 2014
|
||||||||
United States
|
|
$
|
28,088
|
|
|
$
|
22,816
|
|
|
$
|
56,367
|
|
|
$
|
45,250
|
|
International
|
|
2,186
|
|
|
1,869
|
|
|
4,181
|
|
|
3,709
|
|
||||
Total revenue
|
|
$
|
30,274
|
|
|
$
|
24,685
|
|
|
$
|
60,548
|
|
|
$
|
48,959
|
|
|
|
June 30, 2015
|
|
December 31, 2014
|
||||
United States
|
|
$
|
9,875
|
|
|
$
|
10,625
|
|
International
|
|
2,089
|
|
|
1,946
|
|
||
Property and equipment, net
|
|
$
|
11,964
|
|
|
$
|
12,571
|
|
|
|
Twelve Months Ended
|
||
|
|
June 30, 2015
|
|
June 30, 2014
|
Dollar-Based Retention Rate
|
|
94%
|
|
98%
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
June 30, 2015
|
|
June 30, 2014
|
||||||||
Net loss
|
|
$
|
(7,369
|
)
|
|
$
|
(8,659
|
)
|
|
$
|
(16,272
|
)
|
|
$
|
(16,979
|
)
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization
(1)
|
|
1,910
|
|
|
1,699
|
|
|
3,685
|
|
|
3,291
|
|
||||
Stock-based compensation
(2)
|
|
1,830
|
|
|
1,723
|
|
|
4,065
|
|
|
2,919
|
|
||||
Interest expense
|
|
1,155
|
|
|
1,092
|
|
|
2,294
|
|
|
1,870
|
|
||||
Interest income and other
|
|
49
|
|
|
28
|
|
|
47
|
|
|
(4
|
)
|
||||
Provision for (benefit from) income taxes
|
|
(20
|
)
|
|
12
|
|
|
(2
|
)
|
|
39
|
|
||||
Reversal of contingent sales tax liability
(3)
|
|
—
|
|
|
(2,766
|
)
|
|
—
|
|
|
(2,766
|
)
|
||||
Change in fair value of convertible preferred and common stock warrant liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,745
|
)
|
||||
Out of period adjustment for sales tax liability
(4)
|
|
190
|
|
|
—
|
|
|
765
|
|
|
—
|
|
||||
Adjusted EBITDA
|
|
$
|
(2,255
|
)
|
|
$
|
(6,871
|
)
|
|
$
|
(5,418
|
)
|
|
$
|
(13,375
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
June 30, 2015
|
|
June 30, 2014
|
||||||||
Cost of revenue
|
|
$
|
1,558
|
|
|
$
|
1,373
|
|
|
$
|
2,997
|
|
|
$
|
2,575
|
|
Research and development
|
|
102
|
|
|
50
|
|
|
189
|
|
|
96
|
|
||||
Sales and marketing
|
|
51
|
|
|
48
|
|
|
100
|
|
|
96
|
|
||||
General and administrative
|
|
199
|
|
|
228
|
|
|
399
|
|
|
524
|
|
||||
Total depreciation and amortization
|
|
$
|
1,910
|
|
|
$
|
1,699
|
|
|
$
|
3,685
|
|
|
$
|
3,291
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
June 30, 2015
|
|
June 30, 2014
|
||||
Revenue
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
Cost of revenue
|
|
47
|
%
|
|
55
|
%
|
|
48
|
%
|
|
54
|
%
|
Gross profit
|
|
53
|
%
|
|
45
|
%
|
|
52
|
%
|
|
46
|
%
|
Operating expenses:
|
|
|
|
|
|
|
|
|
||||
Research and development
|
|
18
|
%
|
|
22
|
%
|
|
19
|
%
|
|
22
|
%
|
Sales and marketing
|
|
35
|
%
|
|
39
|
%
|
|
34
|
%
|
|
38
|
%
|
General and administrative
|
|
20
|
%
|
|
14
|
%
|
|
22
|
%
|
|
20
|
%
|
Total operating expenses
|
|
73
|
%
|
|
75
|
%
|
|
75
|
%
|
|
80
|
%
|
Loss from operations
|
|
(20
|
)%
|
|
(30
|
)%
|
|
(23
|
)%
|
|
(34
|
)%
|
Other income (expense), net:
|
|
|
|
|
|
|
|
|
||||
Change in fair value of convertible preferred and common stock warrant liabilities
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
3
|
%
|
Interest expense
|
|
(4
|
)%
|
|
(5
|
)%
|
|
(4
|
)%
|
|
(4
|
)%
|
Interest income and other
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Total other income (expense), net
|
|
(4
|
)%
|
|
(5
|
)%
|
|
(4
|
)%
|
|
(1
|
)%
|
Loss before provision for (benefit from) income taxes
|
|
(24
|
)%
|
|
(35
|
)%
|
|
(27
|
)%
|
|
(35
|
)%
|
Provision for (benefit from) income taxes
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Net loss
|
|
(24
|
)%
|
|
(35
|
)%
|
|
(27
|
)%
|
|
(35
|
)%
|
|
|
Three Months Ended
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change
|
|
%
Change
|
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change |
|
%
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except percentages)
|
||||||||||||||
Revenue
|
|
$30,274
|
|
$24,685
|
|
$5,589
|
|
23%
|
|
$60,548
|
|
$48,959
|
|
$11,589
|
|
24%
|
|
|
Three Months Ended
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change |
|
%
Change |
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change |
|
%
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except percentages)
|
||||||||||||||
Cost of revenue
|
|
$14,270
|
|
$13,469
|
|
$801
|
|
6%
|
|
$29,048
|
|
$26,617
|
|
$2,431
|
|
9%
|
% of Revenue
|
|
47%
|
|
55%
|
|
|
|
|
|
48%
|
|
54%
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change |
|
%
Change |
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change |
|
%
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except percentages)
|
||||||||||||||
Gross profit
|
|
$16,004
|
|
$11,216
|
|
$4,788
|
|
43%
|
|
$31,500
|
|
$22,342
|
|
$9,158
|
|
41%
|
% of Revenue
|
|
53%
|
|
45%
|
|
|
|
|
|
52%
|
|
46%
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change |
|
%
Change |
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change |
|
%
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except percentages)
|
||||||||||||||
Research and development
|
|
$5,568
|
|
$5,554
|
|
$14
|
|
—%
|
|
$11,606
|
|
$10,779
|
|
$827
|
|
8%
|
% of Revenue
|
|
18%
|
|
22%
|
|
|
|
|
|
19%
|
|
22%
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change |
|
%
Change |
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change |
|
%
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except percentages)
|
||||||||||||||
Sales and marketing
|
|
$10,594
|
|
$9,674
|
|
$920
|
|
10%
|
|
$20,525
|
|
$18,696
|
|
$1,829
|
|
10%
|
% of Revenue
|
|
35%
|
|
39%
|
|
|
|
|
|
34%
|
|
38%
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change |
|
%
Change |
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change |
|
%
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in thousands, except percentages)
|
||||||||||||||
General and administrative
|
|
$6,027
|
|
$3,515
|
|
$2,512
|
|
71%
|
|
$13,302
|
|
$9,686
|
|
$3,616
|
|
37%
|
% of Revenue
|
|
20%
|
|
14%
|
|
|
|
|
|
22%
|
|
20%
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
||||||||||||||||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change |
|
%
Change |
|
June 30, 2015
|
|
June 30, 2014
|
|
$
Change |
|
%
Change |
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
(in thousands, except percentages)
|
||||||||||||||||||||||||||||
Change in fair value of convertible preferred and common stock warrant liabilities
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
—
|
|
|
$
|
1,745
|
|
|
$
|
(1,745
|
)
|
|
(100
|
)%
|
Interest expense
|
|
(1,155
|
)
|
|
(1,092
|
)
|
|
(63
|
)
|
|
6
|
%
|
|
(2,294
|
)
|
|
(1,870
|
)
|
|
(424
|
)
|
|
23
|
%
|
||||||
Interest income and other
|
|
(49
|
)
|
|
(28
|
)
|
|
(21
|
)
|
|
75
|
%
|
|
(47
|
)
|
|
4
|
|
|
(51
|
)
|
|
(1,275
|
)%
|
||||||
Total other income (expense), net
|
|
$
|
(1,204
|
)
|
|
$
|
(1,120
|
)
|
|
$
|
(84
|
)
|
|
8
|
%
|
|
$
|
(2,341
|
)
|
|
$
|
(121
|
)
|
|
$
|
(2,220
|
)
|
|
1,835
|
%
|
% of Revenue
|
|
(4)%
|
|
(5)%
|
|
|
|
|
|
(4)%
|
|
(1)%
|
|
|
|
|
|
|
Six Months Ended
|
|
|
|
|
|||||||||
|
|
June 30, 2015
|
|
June 30, 2014
|
|
$ Change
|
|
% Change
|
|||||||
Net cash used in operating activities
|
|
$
|
(9,710
|
)
|
|
$
|
(14,398
|
)
|
|
$
|
4,688
|
|
|
(33
|
)%
|
Net cash provided by (used in) investing activities
|
|
20,392
|
|
|
(30,354
|
)
|
|
50,746
|
|
|
(167
|
)%
|
|||
Net cash provided by (used in) financing activities
|
|
(3,638
|
)
|
|
88,581
|
|
|
(92,219
|
)
|
|
(104
|
)%
|
|||
Net increase in cash and cash equivalents
|
|
$
|
7,044
|
|
|
$
|
43,829
|
|
|
$
|
(36,785
|
)
|
|
(84
|
)%
|
•
|
market acceptance of our solution;
|
•
|
our ability to attract new clients and grow our business with existing clients;
|
•
|
client renewal rates;
|
•
|
changes in strategic and client relationships;
|
•
|
the timing and success of new product and feature introductions by us or our competitors or any other change in the competitive dynamics of our industry, including consolidation among competitors, clients or strategic partners;
|
•
|
network outages or security breaches, which may result in the loss of clients, client credits and harm to our reputation;
|
•
|
seasonal factors that may cause our revenues in the first half of a year to be relatively lower than our revenues in the second half of a year, which we believe are due to the general increase in customer support and marketing and sales activities leading up to, and during, the holiday season;
|
•
|
inaccessibility or failure of our cloud contact center software due to failures in the products or services provided by third parties;
|
•
|
the timing of recognition of revenues;
|
•
|
the amount and timing of costs and expenses related to the maintenance and expansion of our business, operations and infrastructure;
|
•
|
increases or decreases in the elements of our solution or pricing changes upon any renewals of client agreements;
|
•
|
changes in our pricing policies or those of our competitors;
|
•
|
the level of professional services and support we provide our clients;
|
•
|
the components of our revenue;
|
•
|
the addition or loss of key clients, including through acquisitions or consolidations;
|
•
|
general economic, industry and market conditions;
|
•
|
the timing of costs and expenses related to the development or acquisition of technologies or businesses and potential future charges for impairment of goodwill from acquired companies;
|
•
|
compliance with, or changes in, the current and future regulatory environment;
|
•
|
the hiring, training and retention of key employees;
|
•
|
litigation or other claims against us;
|
•
|
our ability to obtain additional financing; and
|
•
|
advances and trends in new technologies and industry standards.
|
•
|
compete with other vendors of cloud-based enterprise contact center systems to capture market share from providers of legacy on-premise systems;
|
•
|
increase our existing clients’ use of our solution and further develop our partner ecosystem;
|
•
|
introduce our solution to new markets outside of the United States and increase global awareness of our brand;
|
•
|
strengthen and improve our solution through significant investments in research and development; and
|
•
|
selectively pursue acquisitions.
|
•
|
sales and marketing, including a significant expansion of our sales organization;
|
•
|
our technology infrastructure, including systems architecture, management tools, scalability, availability, performance and security, as well as disaster recovery measures;
|
•
|
solution development, including investments in our solution development team and the development of new applications and features for existing solutions;
|
•
|
international expansion; and
|
•
|
general administration, including legal, regulatory compliance and accounting expenses.
|
•
|
cause our clients to seek credits or damages for losses incurred;
|
•
|
cause existing clients to cancel or elect not to renew their contracts;
|
•
|
affect our reputation as a reliable service provider;
|
•
|
make it more difficult for us to attract new clients or expand our business with existing clients; or
|
•
|
require us to replace existing equipment.
|
•
|
the volume of minutes for inbound and outbound interactions between our clients and their customers decreases,
|
•
|
clients are not satisfied with our services, prices or the functionality of our solution,
|
•
|
the stability, performance and security of our hosting infrastructure and hosting services are not satisfactory,
|
•
|
our clients’ business declines due to industry cycles, seasonality, business difficulties or for other reasons,
|
•
|
competition increases from other contact center providers,
|
•
|
alternative technologies emerge which we do not provide,
|
•
|
clients experience financial difficulties, or
|
•
|
the U.S. or global economy declines.
|
•
|
damage to third-party and our infrastructure and data centers, related equipment and surrounding properties caused by earthquakes, hurricanes, tornadoes, floods, fires and other natural disasters, explosions and acts of terrorism;
|
•
|
inadvertent damage from third parties; and
|
•
|
other hazards that could also result in suspension of operations, personal injury and even loss of life.
|
•
|
the need to establish and protect our brand in international markets;
|
•
|
the need to localize and adapt our solution for specific countries, including translation into foreign languages and associated costs and expenses;
|
•
|
difficulties in staffing and managing foreign operations, particularly hiring and training qualified sales and service personnel;
|
•
|
different pricing environments, longer sales and accounts receivable payment cycles and collections issues;
|
•
|
new and different sources of competition;
|
•
|
general economic conditions in international markets;
|
•
|
fluctuations in the value of the U.S. dollar and foreign currencies, which may make our solution more expensive in other countries or may increase our costs, impacting our operating results when translated into U.S. dollars;
|
•
|
compliance challenges related to the complexity of multiple, conflicting and changing governmental laws and regulations, including employment, tax, telecommunications and telemarketing laws and regulations;
|
•
|
privacy and data protection laws and regulations that are complex, expensive to comply with and may require that client data be stored and processed in a designated territory;
|
•
|
weaker protection for intellectual property and other legal rights than in the U.S. and practical difficulties in enforcing intellectual property and other rights outside of the U.S.;
|
•
|
increased risk of international telecom fraud;
|
•
|
laws and business practices favoring local competitors;
|
•
|
compliance with U.S. laws and regulations for foreign operations, including the Foreign Corrupt Practices Act, the U.K. Bribery Act, import and export control laws, tariffs, trade barriers, economic sanctions and regulatory or contractual limitations on our ability to sell our solution in certain foreign markets, and the risks and costs of non-compliance;
|
•
|
increased financial accounting and reporting burdens and complexities;
|
•
|
restrictions on the transfer of funds;
|
•
|
adverse tax consequences; and
|
•
|
unstable economic and political conditions.
|
•
|
inability to integrate or benefit from acquisitions in a profitable manner;
|
•
|
unanticipated costs or liabilities associated with the acquisition;
|
•
|
incurrence of acquisition-related costs;
|
•
|
difficulty converting the clients of the acquired business to our solution and contract terms, including disparities in the revenues, licensing, support or professional services model of the acquired company;
|
•
|
difficulty integrating the accounting systems, operations and personnel of the acquired business;
|
•
|
difficulties and additional costs and expenses associated with supporting legacy products and hosting infrastructure of the acquired business;
|
•
|
diversion of management’s attention from other business concerns;
|
•
|
harm to our existing relationships with our partners and clients as a result of the acquisition;
|
•
|
the loss of our or the acquired business’s key employees;
|
•
|
diversion of resources that could have been more effectively deployed in other parts of our business; and
|
•
|
use of substantial portions of our available cash to consummate the acquisition.
|
•
|
the Communications Assistance for Law Enforcement Act, or CALEA, which requires covered entities to assist law enforcement in undertaking electronic surveillance;
|
•
|
contributions to the USF which requires that we pay a percentage of our revenues resulting from the provision of interstate telecommunications services to support certain federal programs;
|
•
|
payment of annual FCC regulatory fees based on our interstate and international revenues;
|
•
|
rules pertaining to access to our services by people with disabilities and contributions to the Telecommunications Relay Services fund; and
|
•
|
FCC rules regarding Customer Proprietary Network Information, or CPNI, which prohibit us from using such information without client approval, subject to certain exceptions.
|
•
|
actual or anticipated fluctuations in our operating results;
|
•
|
the financial projections we provide to the public, any changes in these projections or our failure to meet these projections;
|
•
|
failure of securities analysts to initiate or maintain coverage of our company, changes in financial estimates by any securities analysts who follow our company, or our failure to meet these estimates or the expectations of investors;
|
•
|
ratings changes by any securities analysts who follow our company;
|
•
|
announcements by us or our competitors of significant technical innovations, acquisitions, strategic partnerships, joint ventures or capital commitments;
|
•
|
changes in operating performance and stock market valuations of other technology companies generally, or those in the SaaS industry in particular;
|
•
|
price and volume fluctuations in the overall stock market, including as a result of trends in the U.S. or global economy;
|
•
|
any major change in our board of directors or management;
|
•
|
lawsuits threatened or filed against us;
|
•
|
legislation or regulation of our business, the internet and/or contact centers;
|
•
|
loss of key personnel;
|
•
|
new entrants into the contact center market, including the transition by providers of legacy on-premise contact center systems to cloud solutions, as well as cable and incumbent telephone companies and other well-capitalized competitors;
|
•
|
new products or new sales by us or our competitors;
|
•
|
the perceived or real impact of events that harm our direct competitors;
|
•
|
developments with respect to patents or proprietary rights;
|
•
|
general market conditions; and
|
•
|
other events or factors, including those resulting from war, incidents of terrorism or responses to these events, which could be unrelated to, or outside of, our control.
|
•
|
provide that our board of directors is classified into three classes of directors;
|
•
|
provide that stockholders may remove directors only for cause and only with the approval of holders of at least 66
2
⁄
3
% of our then outstanding capital stock;
|
•
|
provide that the authorized number of directors may be changed only by resolution of the board of directors;
|
•
|
provide that all vacancies, including newly created directorships, may, except as otherwise required by law, be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum;
|
•
|
provide that our stockholders may not take action by written consent, and may only take action at annual or special meetings of our stockholders;
|
•
|
provide that stockholders seeking to present proposals before a meeting of stockholders or to nominate candidates for election as directors at a meeting of stockholders must provide notice in writing in a timely manner, and also specify requirements as to the form and content of a stockholder’s notice;
|
•
|
restrict the forum for certain litigation against us to Delaware;
|
•
|
do not provide for cumulative voting rights (therefore allowing the holders of a majority of the shares of common stock entitled to vote in any election of directors to elect all of the directors standing for election);
|
•
|
provide that special meetings of our stockholders may be called only by the chairman of the board, our chief executive officer or the board of directors pursuant to a resolution adopted by a majority of the total number of authorized directors; and
|
•
|
provide that stockholders will be permitted to amend our amended and restated bylaws only upon receiving at least 66
2
/
3
% of the votes entitled to be cast by holders of all outstanding shares then entitled to vote generally in the election of directors, voting together as a single class.
|
•
|
delaying, deferring or preventing a change in control of Five9;
|
•
|
impeding a merger, consolidation, takeover or other business combination involving us; or
|
•
|
discouraging a potential acquirer from making a tender offer or otherwise attempting to obtain control of Five9.
|
Exhibit
Number
|
|
Description
|
3.1
|
|
Amended and Restated Certificate of Incorporation of Five9, Inc. (filed as Exhibit 3.2 to the Company’s Current Report on Form 8-K filed with the SEC on April 10, 2014 (File No. 001-36383) and incorporated by reference herein).
|
3.2
|
|
Amended and Restated Bylaws of Five9, Inc. (filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the SEC on April 10, 2014 (File No. 001-36383) and incorporated by reference herein).
|
10.1*
|
|
Form of Indemnification Agreement between the Registrant and each of its directors and executive officers, as Amended on July 31, 2015.
|
31.1*
|
|
Certification of Chief Executive Officer of Five9, Inc. Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
31.2*
|
|
Certification of Chief Financial Officer of Five9, Inc. Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
32.1**
|
|
Certification of Chief Executive Officer and Chief Financial Officer of Five9, Inc. Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS*
|
|
XBRL Instance Document
|
101.SCH*
|
|
XBRL Taxonomy Schema Linkbase Document
|
101.CAL*
|
|
XBRL Taxonomy Calculation Linkbase Document
|
101.DEF*
|
|
XBRL Taxonomy Definition Linkbase Document
|
101.LAB*
|
|
XBRL Taxonomy Labels Linkbase Document
|
101.PRE*
|
|
XBRL Taxonomy Presentation Linkbase Document
|
|
|
|
|
|
|
Five9, Inc.
|
|
|
|
|
Date:
|
August 4, 2015
|
By:
|
/s/ Michael Burkland
|
|
|
|
Michael Burkland
|
|
|
|
Chief Executive Officer and President
|
|
|
|
(Duly Authorized Officer)
|
|
|
|
|
Date:
|
August 4, 2015
|
By:
|
/s/ Barry Zwarenstein
|
|
|
|
Barry Zwarenstein
|
|
|
|
Chief Financial Officer
|
|
|
|
(Principal Financial Officer)
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Five9, Inc. for the quarter ended
June 30, 2015
;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(c)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
August 4, 2015
|
By:
|
/s/ Michael Burkland
|
|
|
|
Michael Burkland
|
|
|
|
Chief Executive Officer and President
|
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Five9, Inc. for the quarter ended
June 30, 2015
;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(c)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
August 4, 2015
|
By:
|
/s/ Barry Zwarenstein
|
|
|
|
Barry Zwarenstein
|
|
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Chief Financial Officer
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(Principal Financial Officer)
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Date:
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August 4, 2015
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By:
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/s/ Michael Burkland
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Michael Burkland
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Chief Executive Officer and President
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Date:
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August 4, 2015
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By:
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/s/ Barry Zwarenstein
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Barry Zwarenstein
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Chief Financial Officer
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