1、UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549FORM 10-K(MARK ONE)xxANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934FOR THE FISCAL YEAR ENDED DECEMBER 31,2015ORTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 19
2、34FOR THE TRANSITION PERIOD FROM TO Commission File Number 001-36680HubSpot,Inc.(Exact name of registrant as specified in its charter)Delaware 20-2632791(State or other jurisdiction ofincorporation or organization)(I.R.S.EmployerIdentification No.)25 First Street,2nd FloorCambridge,Massachusetts,021
3、41(Address of principal executive offices)(888)482-7768(Registrants telephone number,including area code)Securities registered pursuant to Section 12(b)of the Act:Title of each class Name of each exchange on which registeredCommon Stock,par value$0.001 per share New York Stock ExchangeSecurities reg
4、istered pursuant to Section 12(g)of the Act:None.Indicatebycheckmarkiftheregistrantisawell-knownseasonedissuer,asdefinedinRule405oftheSecuritiesAct.YESxNOIndicatebycheckmarkwhethertheregistrantisnotrequiredtofilereportspursuanttoSection13orSection15(d)oftheAct.YESNOxIndicatebycheckmarkwhethertheregi
5、strant(1)hasfiledallreportsrequiredtobefiledbySection13or15(d)oftheSecuritiesExchangeActof1934duringthepreceding12months(orforsuchshorterperiodthattheregistrantwasrequiredtofilesuchreports),and(2)hasbeensubjecttosuchfilingrequirementsforthepast90days.YESxNOIndicatebycheckmarkwhethertheregistranthass
6、ubmittedelectronicallyandpostedonitscorporateWebsite,ifany,everyInteractiveDatafilerequiredtobesubmittedandpostedpursuanttoRule405ofRegulationS-T(232.405ofthischapter)duringthepreceding12months(orforsuchshorterperiodthattheregistrantwasrequiredtosubmitandpostsuchfiles).YESxNOIndicatebycheckmarkifdis
7、closureofdelinquentfilerspursuanttoItem405ofRegulationS-Kisnotcontainedherein,andwillnotbecontained,tothebestofregistrantsknowledge,indefinitiveproxyorinformationstatementsincorporatedbyreferenceinPartIIIofthisForm10-KoranyamendmenttothisForm10-K.Indicatebycheckmarkwhethertheregistrantisalargeaccele
8、ratedfiler,anacceleratedfiler,anon-acceleratedfiler,orasmallerreportingcompany.Seethedefinitionsof“largeacceleratedfiler,”“acceleratedfiler,”and“smallerreportingcompany”inRule12b-2oftheExchangeAct.(Checkone):Largeacceleratedfiler x Acceleratedfiler Non-acceleratedfiler(Donotcheckifasmallerreportingc
9、ompany)Smallerreportingcompany Indicatebycheckmarkwhethertheregistrantisashellcompany(asdefinedinRule12b-2oftheExchangeAct).YESNOxTheaggregatemarketvalueofcommonstockheldbynon-affiliatesoftheregistrant,basedontheclosingpriceoftheregistrantscommonstockonJune30,2015,asreportedbytheNewYorkStockExchange
10、onsuchdatewasapproximately$1,049,025,000.Sharesoftheregistrantscommonstockheldbyeachexecutiveofficer,directorandholderof5%ormoreoftheoutstandingcommonstockhavebeenexcludedinthatsuchpersonsmaybedeemedtobeaffiliates.Thiscalculationdoesnotreflectadeterminationthatcertainpersonsareaffiliatesoftheregistr
11、antforanyotherpurpose.OnFebruary12,2016,theregistranthad34,707,673sharesofcommonstockoutstanding.DOCUMENTS INCORPORATED BY REFERENCEPortionsoftheregistrantsdefinitiveProxyStatementforits2016AnnualMeetingofStockholdersareincorporatedbyreferenceinPartIIIofthisAnnualReportonForm10-K.SuchProxyStatementw
12、illbefiledwiththeU.S.SecuritiesandExchangeCommissionwithin120daysaftertheendofthefiscalyeartowhichthisreportrelates.ExceptwithrespecttoinformationspecificallyincorporatedbyreferenceinthisForm10-K,theProxyStatementisnotdeemedtobefiledaspartofthisForm10-K.HUBSPOT,INC.TABLE OF CONTENTS PageNo.PART I IT
13、EM1.Business2ITEM1A.RiskFactors14ITEM1B.UnresolvedStaffComments31ITEM2.Properties31ITEM3.LegalProceedings31ITEM4.MineSafetyDisclosures31PART IIITEM5.MarketforRegistrantsCommonEquity,RelatedStockholderMattersandIssuerPurchasesofEquitySecurities32ITEM6.SelectedFinancialData33ITEM7.ManagementsDiscussio
14、nandAnalysisofFinancialConditionandResultsofOperations36ITEM7A.QuantitativeandQualitativeDisclosuresAboutMarketRisk53ITEM8.FinancialStatementsandSupplementaryData54ITEM9.ChangesinandDisagreementswithAccountantsonAccountingandFinancialDisclosures77ITEM9A.ControlsandProcedures77ITEM9B.OtherInformation
15、79PART IIIITEM10.Directors,ExecutiveOfficersandCorporateGovernance80ITEM11.ExecutiveCompensation80ITEM12.SecurityOwnershipofCertainBeneficialOwnersandManagementandRelatedStockholderMatters80ITEM13.CertainRelationshipsandRelatedTransactions,andDirectorIndependence80ITEM14.PrincipalAccountingFeesandSe
16、rvices80PART IVITEM15.Exhibits,FinancialStatementSchedules81SIGNATURES82iSPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTSThisAnnualReportonForm10-Kcontainsforward-lookingstatementswithinthemeaningofthefederalsecuritieslaws,andthesestatementsinvolvesubstantialrisksanduncertainties.Forward-lookingsta
17、tementsgenerallyrelatetofutureeventsorourfuturefinancialoroperatingperformance.Insomecases,youcanidentifyforward-lookingstatementsbecausetheycontainwordssuchas“may,”“should,”“expects,”“plans,”“anticipates,”“could,”“intends,”“target,”“projects,”“contemplates,”“believes,”“estimates,”“predicts,”“potent
18、ial”or“continue”orthenegativeofthesewordsorothersimilartermsorexpressionsthatconcernourexpectations,strategy,plansorintentions.Forward-lookingstatementscontainedinthisAnnualReportonForm10-Kinclude,butarenotlimitedto,statementsabout:ourfuturefinancialperformance,includingourexpectationsregardingourre
19、venue,costofrevenue,grossmarginandoperatingexpenses;maintainingandexpandingourcustomerbaseandincreasingouraveragesubscriptionrevenuepercustomer;theimpactofcompetitioninourindustryandinnovationbyourcompetitors;ouranticipatedgrowthandexpectationsregardingourabilitytomanageourfuturegrowth;ourprediction
20、saboutindustryandmarkettrends;ourabilitytoanticipateandaddresstheevolutionoftechnologyandthetechnologicalneedsofourcustomers,toroll-outupgradestoourexistingsoftwareplatformandtodevelopnewandenhancedapplicationstomeettheneedsofourcustomers;ourabilitytomaintainourbrandandinboundmarketingthoughtleaders
21、hipposition;theimpactofourcorporatecultureandourabilitytoattract,hireandretainnecessaryqualifiedemployeestoexpandouroperations;theanticipatedeffectonourbusinessoflitigationtowhichweareormaybecomeaparty;ourabilitytosuccessfullyacquireandintegratecompaniesandassets;andourabilitytostayabreastofnewormod
22、ifiedlawsandregulationsthatcurrentlyapplyorbecomeapplicabletoourbusinessbothintheUnitedStatesandinternationally.Wecautionyouthattheforegoinglistmaynotcontainalloftheforward-lookingstatementsmadeinthisAnnualReportonForm10-K.Youshouldnotrelyuponforward-lookingstatementsaspredictionsoffutureevents.Weha
23、vebasedtheforward-lookingstatementscontainedinthisAnnualReportonForm10-Kprimarilyonourcurrentexpectationsandprojectionsaboutfutureeventsandtrendsthatwebelievemayaffectourbusiness,financialcondition,resultsofoperationsandprospects.Theoutcomeoftheeventsdescribedintheseforward-lookingstatementsissubjec
24、ttorisks,uncertaintiesandotherfactorsdescribedin“RiskFactors”andelsewhereinthisAnnualReportonForm10-K.Moreover,weoperateinaverycompetitiveandrapidlychangingenvironment.Newrisksanduncertaintiesemergefromtimetotime,anditisnotpossibleforustopredictallrisksanduncertaintiesthatcouldhaveanimpactontheforwa
25、rd-lookingstatementscontainedinthisAnnualReportonForm10-K.Theresults,eventsandcircumstancesreflectedintheforward-lookingstatementsmaynotbeachievedoroccur,andactualresults,eventsorcircumstancescoulddiffermateriallyfromthosedescribedintheforward-lookingstatements.Theforward-lookingstatementsmadeinthis
26、AnnualReportonForm10-Krelateonlytoeventsasofthedateonwhichthestatementsaremade.Weundertakenoobligationtoupdateanyforward-lookingstatementsmadeinthisAnnualReportonForm10-KtoreflecteventsorcircumstancesafterthedateofthisAnnualReportonForm10-Kortoreflectnewinformationortheoccurrenceofunanticipatedevent
27、s,exceptasrequiredbylaw.Wemaynotactuallyachievetheplans,intentionsorexpectationsdisclosedinourforward-lookingstatementsandyoushouldnotplaceunduerelianceonourforward-lookingstatements.Ourforward-lookingstatementsdonotreflectthepotentialimpactofanyfutureacquisitions,mergers,dispositions,jointventureso
28、rinvestmentswemaymake.1PART 1ITEM I.BUSINESSOverviewWeprovideacloud-basedmarketingandsalessoftwareplatformthatenablesbusinessestodeliveraninboundexperience.Aninboundmarketingandsalesexperienceattracts,engagesanddelightscustomersbybeingmorerelevant,morehelpful,morepersonalizedandlessinterruptivethant
29、raditionalmarketingandsalestactics.Oursoftwareplatformfeaturesintegratedapplicationstohelpbusinessesattractvisitorstotheirwebsites,convertvisitorsintoleads,closeleadsintocustomersanddelightcustomerssothattheybecomepromotersofthosebusinesses.Theseintegratedapplicationsincludesocialmedia,searchengineo
30、ptimization,blogging,websitecontentmanagement,marketingautomation,email,CRM,analyticsandreporting.Peoplehavetransformedhowtheyconsumeinformation,researchproductsandservices,makepurchasingdecisionsandsharetheirviewsandexperiences.Today,customersareblockingoutthetacticsfromthetraditionalmarketingandsa
31、lesplaybook,suchascoldcalls,unsolicitedemailsanddisruptiveadvertisements.Customersaretakingmorecontrolofthepurchasingprocessbyusingtechnology,includingsearchenginesandsocialmedia,toresearchproductsandservices.Despitethistransformation,mostbusinessesareusinganoutdatedmarketingandsalesplaybookthatises
32、sentiallythesametodayasitwas10yearsago.Tocompeteeffectively,webelievebusinessesneedtodeliveraninboundexperiencebyadoptingnewstrategiesandtechnologiestoattract,engageanddelightcustomers.Wedesignedourall-in-oneplatformfromthegrounduptoenablebusinessestoprovideaninboundexperiencetotheirprospectsandcust
33、omers.Atthecoreofourplatformisasingleinbounddatabaseforeachbusinessthatcapturesitscustomeractivitythroughoutthecustomerlifecycle.Ourplatformusesourcentralizedinbounddatabasetoempowerbusinessestocreatemorepersonalizedinteractionswithcustomers,suchaspersonalizedemails,personalizedsocialmediaalerts,per
34、sonalizedwebsitesandtargetedalertsforsalespeople.Weprovideacomprehensivesetofintegratedapplicationsonourplatform,whichoffersbusinesseseaseofuse,powerandsimplicity.Wedesignedandbuiltourplatformtoservealargenumberofcustomersofanysizewithdemandingusecases.Whileourplatformcanscaletotheenterprise,wefocus
35、onsellingtomid-marketbusinesses,whichwedefineasbusinessesthathavebetween10and2,000employees,becausewebelievewehavesignificantcompetitiveadvantagesattractingandservingthem.Weefficientlyreachthesebusinessesatscalethroughourproveninboundgo-to-marketapproachandmorethan2,900marketingagencypartnersworldwi
36、de.Ourplatformisparticularlysuitedtoservingtheneedsofmid-marketB2Bcompanies.Thesemid-marketbusinessesseekanintegrated,easytoimplementandeasytousesolutiontoreachcustomersandcompetewithorganizationsthathavelargermarketingandsalesbudgets.AsofDecember31,2015,wehad18,116customersofvaryingsizesinmorethan9
37、0countries,representingalmosteveryindustry.Wehavealeadingbrandinthecloud-basedinboundmarketingandsalessoftwareindustry.Ourbrandrecognitioncomesfromourthoughtleadership,includingourblogs,whichattractmorethan2.5millionvisitseachmonth,andourcommitmenttoinnovation.Ourfounders,BrianHalliganandDharmeshSha
38、h,wrotethebest-sellingmarketingbookInbound Marketing:Get Found Using Google,Social Media and Blogs.WealsohaveoneofthelargestsocialmediafollowingsinourindustryandourINBOUNDconferenceisoneofthelargestinboundindustryevents,withover14,000registeredattendeesin2015.Wesellourplatformonasubscriptionbasis.Ou
39、rtotalrevenueincreasedto$181.9millionin2015,from$115.9millionin2014,andfrom$77.6millionin2013,representingyear-over-yearincreasesof57%in2015and49%in2014.Wehadnetlossesof$46.1millionin2015,$48.2millionin2014,and$34.3millionin2013.Industry BackgroundPeople Have Changed How They Interact with Businesse
40、sWebelieveaneffectivewaytoillustratehowpeoplehavetransformedthewaytheyconsumeinformation,researchproductsandservices,makepurchasingdecisionsandsharetheirviewsandexperiencesisbydescribingtwohypotheticalpeopleTraditionalTedandModernMeghan.2TraditionalTedisanexecutiveata300personcompanyin2005.Hekeepsup
41、todateonhisindustrybyattendingtradeshowsandreadingthemonthlyindustryprintpublication,oftenscanningtheadstoseethevendorsnewproducts.Hegetsafairamountofunsolicitedemailsfromsalespeopleandmarketersandseesanincreasingnumberofadsonwebsiteshevisits.Healsotakessalescallsfromvendorstostaycurrentonindustryde
42、velopments.Tedopenshismaildaily,andwhenhisphonerings,heanswersitbecauseitisacriticalcommunicationtool.WhenTedislookingforanewvendor,hewilltrytorecalltheadshehasseenrecentlyorgothroughthebrochureshehasbeenmailedwhichhekeepsinafileinhisdesk.IfTedisfrustratedwithavendor,hecallsthevendorandtellsacoupleo
43、fhiscolleaguesabouthisbadexperience.Torelax,TedwatchesTVandreadsthenewspaper,bothofwhichcontainadvertisements.ModernMeghanisanexecutiveata300personcompanyin2015.Shekeepsuptodateonherindustrybyreadinganumberofindustryblogs,followingkeycompaniesandinfluencersonTwitterandLinkedInandlisteningtopodcastsi
44、nhercarduringhercommute.Shehasanadblockerrunninginherwebbrowserandanemailfiltertoblockoutunwantedmessages.Sherarelycheckshermailbecauseitismostly“junk.”Meghandoesnothavealandlinephonebecause“onlysalespeoplecallmethere,”andsheneveranswershersmartphoneunlesssherecognizesthenumber.Meghanspendsmuchmoret
45、imeonherphoneusingappsandthewebthanshedoestalkingonit.Ifsheislookingforavendorforsomethinghercompanyneeds,shestartsbysearchingonGoogleandthenaskingherpeersinherLinkedInnetworkabouttheirexperienceswithdifferentvendors.Shedoesnotevenbothertotalktoanyofthevendorssalespeopleuntilshehasnarrowedthelistand
46、hasalreadycompletedmostofherdecision-makingprocess.WhenMeghanhastroublewithoneofhervendors,shecontactsthevendor,butifsheisnotsatisfiedwiththeresponse,shesometimeswritesanegativereviewonlineandpostsalinktoitonTwitter.Inherfreetime,MeghanrelaxesbywatchingTVshowsshehaspreviouslyrecordedonherDVRsoshecan
47、fastforwardthroughthecommercials.WebelieveallofusarebecomingmorelikeModernMeghanandlesslikeTraditionalTed.Yet,mostbusinessesarestilldoingmarketing,salesandserviceasifeveryoneislikeTed.Tobeeffectivetoday,businessesneedtotransformtoattract,engageanddelightcustomerslikeMeghan.The Traditional Business P
48、laybook is BrokenTraditionally,mostbusinesseshavefollowedthesamemarketingandsalesplaybooktogenerateleads,closesalesandprovidesupporttotheircustomers.Today,however,customersareincreasinglyselectingtheirowncommunicationchannelsandexpectingpersonalizedexperiences.Theyareblockingouttraditionalmarketinga
49、ndsalestactics,suchascoldcalls,unsolicitedemailsanddisruptiveadvertisements,andinstead,theyareusingsearchenginesandsocialmediatoresearchproductsandservicesbeforetheycontactavendor.Customersareincreasinglytakingmorecontrolofthepurchasingprocessandinfluencingthepurchasingbehaviorofothers.Customers are
50、 blocking out traditional marketing and sales tactics.Customersareignoringtraditionalmarketingandsalestactics,oftenbyusingtechnologytoblockthemout.Forexample:Thereareapproximately223millionphonenumbersthathavebeenplacedontheU.S.DoNotCallregistry.91%ofpeoplehaveunsubscribedfromemailmarketinglists.Ema
51、ilservicesandspamfiltersareincreasinglyenablingcustomerstofilteroutandde-prioritizepromotionalmessages.68%ofpeoplewhorecordTVcontentdosotoskipadvertisements,accordingtoaMotorolaMobilitystudybasedondatacollectedinDecember2012.Onlineadvertisinghaslimitedengagement.AccordingtoDoubleClick,asofNovember20
52、15,overall3-monthaverageindustryclick-throughratesondisplayadsisonly0.2%.Customers are taking control of the purchasing process.Customerscannowgettheinformationtheyneedontheirownterms.Usingsearchengines,socialmediaandwebsites,customerscanresearchvendorsandactivelyseekrecommendationsfrommembersofthei
53、rsocialnetworks.Asaresult,customersnolongerneedtotalktoasalespersonuntiltheyhavecompletedmostoftheirpurchasingdecision.Thislimitstheamountofinfluencebusinessescanhaveonpurchasedecisionswhenusingthetraditionalbusinessplaybook.3Customers are influencing the purchasing behaviors of others.Customersarer
54、elyinglessonthepromotionalmaterialfrombusinessesandinsteadusingonlinereviewsandinputfromotherpurchaserstomaketheirpurchasingdecision.Suchsocialbehaviorisself-reinforcing:socialbuyersthemselvesaresocialsellerswhoinfluenceotherspurchasingdecisions.AccordingtoasurveyconductedbyDimensionalResearchin2013
55、,88%ofrespondentssaidthatonlinereviewsinfluencedtheirbuyingdecisions.Businesses Need a New PlaybookThe Inbound ExperienceBusinessesneedamoreeffectivewaytoattract,engageanddelightcustomerswhohaveaccesstoanabundanceofinformationandanabilitytoblocktraditionalmarketingandsalestactics.Todothis,businesses
56、needtodeliveraninboundexperience,whichenablesthemtobemorehelpful,morerelevantandlessinterruptivetotheircustomers.Todeliveraninboundexperience,businessesneedtotransformhowtheymarket,sellandservecustomers.Marketing:Businessesneedtoattractpotentialcustomersbymaximizingsearchenginerankings,havinganengag
57、ingsocialmediapresence,andcreatinganddistributingusefulandrelevantcontent.Businessesneedtopersonalizetheircustomerinteractionsonwebsites,insocialmediaandinemailstoengagecustomers.Sales:Businessesneedtobuildrelationshipswithpotentialcustomersandbecometheirtrustedadvisors.Theymustlearnaboutandreacttot
58、hesignalsbeingsentbycustomersthroughwebsites,socialmediaandemails,toprovidepersonalizedandhelpfulresponses.Service:Businessesneedtodelighttheircustomersandinspirethemtobecomevocalpromotersbyexceedingtheirexpectations.Everycustomerhasastronger,morepublicvoicetodaythroughblogsandsocialmedia,underscori
59、ngtheimportanceofpositivereviewsandreferralsinbuildingaqualitybrand.Existing Applications are Not Adequate for an Integrated Inbound ExperienceToday,businessesoftenuseavarietyofpointapplicationsfortheirmarketingandsalesefforts,includingadvertising,marketingautomation,contentmanagement,blogging,socia
60、lmediamanagement,analytics,salesmanagementandCRM.Mostofthesepointapplicationswerenotdesignedtodeliveraninboundexperience.Typically,theydonotprovideacentralviewofallcustomerinteractionsacrosschannels,aredifficultandexpensivetoimplementandusetogether,andmakeithardtomeasureresults.Webelievethattheseexi
61、stingpointapplicationswerenotdesignedwiththeplatform,architectureandfunctionalitynecessarytodeliveraseamlessintegratedinboundexperience.Not Designed for an Inbound Experience.Traditionalmarketingapplicationsrelyonadvertisingandcoldcallingforleadgenerationinsteadofinboundmethods.Theseapplicationsaren
62、otdesignedtopersonalizeandoptimizeeveryinteractionwithcustomersonwebsites,insocialmediaandbyemailacrossdevices,anddonottypicallyallowsalesandserviceteamstoseethesignalstheirprospectsaresendinginrealtime.No Centralized Inbound Database of Customer Interactions.Businessestypicallyneedtouseonepointappl
63、icationforwebsitecontentmanagement,adifferentpointapplicationforblogging,anotherpointapplicationforsocialmediamanagement,anotherpointapplicationforemailandmarketingautomation,anotherpointapplicationforcontentpersonalization,anotherpointapplicationforanalytics,anotherpointapplicationforsalesmanagemen
64、tandCRM,andyetanotherpointapplicationtoalertsalespeopleofkeycustomersignalsinrealtime.Thisdisparatecollectionofpointapplicationsmakesitdifficulttogeta360-degreeviewofacustomersinteractionsandusethatdatatoprovideabettercustomerexperienceanddriveamoreeffectivemarketingandsalesprocess.Inaddition,existi
65、ngpointapplicationsaretypicallynotdesignedtomanage,processandanalyzeallofthecustomerdatacreatedbythesevarioustouchpointsbecausetheyuseoldertechnologies,notbigdatatechnologiessuchasHBaseandHadoopthataredesignedformassivescale.Difficult and Expensive to Implement and Use.Usingacollectionofdisparatepoi
66、ntapplicationsmeansaseparateimplementationprocessforeach.Oftenbusinesseswillneedtouseoutsideconsultantsorhirenewemployeeswithspecifictechnicalexpertisetoimplementandusethesedifferentapplications,resultinginsignificantadditionalcosts.Thiscollectionofdisparatepointapplicationsalsorequiresthatbusinesse
67、smanageavarietyofdifferentlog-insanduserinterfaces,aswellasgetsupportfromdifferentvendors,oftenjusttodosomethingthebusinessseesasoneprocess,suchasrunningamarketingcampaign.Whileeaseofimplementationanduseareimportantforbusinessesofallsizes,theyarecriticalformid-marketbusinesses.Hard to Measure Result
68、s.Becauseallthecustomertouchpointsthroughthemarketing,salesandserviceprocessesaretypicallystoredindifferentdisconnectedpointapplications,itisverydifficulttogeta360-degreeviewofacustomersinteractionsandmeasuretheeffectivenessofmarketingandsalesprograms.Businesseswilloftenpurchaseyetanotherapplication
69、totrytomeasureresultsacrosstheirmultipleapplications,addingevenmoreexpenseandcomplexitytoanalreadycomplexcollectionofdifferentpointapplications.4Market OpportunityWebelievethereisalargemarketopportunitycreatedbythefundamentaltransformationinmarketingandsales.Businessesofnearlyallsizesandinnearlyalli
70、ndustriescanbenefitfromdeliveringaninboundexperiencetoattract,engageanddelighttheircustomers.Wefocusonsellingourplatformtomid-marketbusinesses.AsofDecember31,2015,wehad18,116customers,andouraveragesubscriptionrevenuepercustomerfortheyearendedDecember31,2015was$10,419.AccordingtoAMIPartners,in2014,th
71、erewere1.6millionofthesemid-marketbusinesseswithawebsitepresenceintheUnitedStatesandCanadaand1.4millioninEurope.AccordingtoaJanuary2014studybyMintigoof186,500U.S.-basedB2Bcompaniesofvaryingsizes,only3%ofthosecompanieshadimplementedanyofthemostcommonmarketingautomationapplications.Webelieveourplatfor
72、maddressesseveralsegmentsofexistingmarketing,salesandservicessoftwareandthatspendingineachofthesesegmentswillincreasinglyshifttoplatformsthatenableaninboundexperience.AccordingtoaMay2014reportbyIDC,worldwidespendingonCRMapplications,includingmarketingautomation,salesautomation,customerserviceandcont
73、actcenter,isexpectedtogrowto$31.7billionin2018.Advantages of Our SolutionWeprovideacloud-based,all-in-oneinboundmarketingandsalessoftwareplatformthathelpsbusinessesattract,engageanddelightcustomersthroughoutthecustomerlifecycle.Ourplatformfeaturesacentralinbounddatabaseofcustomerinteractionsandinteg
74、ratedapplicationstohelpbusinessesattractvisitorstotheirwebsites,convertvisitorsintoleads,closeleadsintocustomersanddelightcustomerssotheybecomepromotersofthosebusinesses.Designed for an Inbound Experience.Ourplatformwasarchitectedfromthegrounduptoenablebusinessestotransformtheirmarketingandsalesplay
75、booktomeetthedemandsoftodayscustomers.Ourplatformincludesintegratedapplicationstohelpbusinessesefficientlyattractmorecustomersthroughsearchengineoptimization,socialmedia,bloggingandotherusefulcontent.Inaddition,ourplatformisdesignedtohelpbusinessespersonalizeandoptimizeinteractionswiththeircustomers
76、throughwebsites,landingpages,socialmediaandemails,andacrossdevices.Ease of Use of All-In-One Platform.Weprovideasetofintegratedapplicationsonacommonplatform,whichoffersbusinesseseaseofuseandsimplicity.Ourplatformhasonelogin,oneuserinterface,oneinbounddatabaseandonenumbertocallforsupport:888-HUBSPOT.
77、Ourplatformisdesignedtobeusedbypeoplewithouttechnicaltraining,doesnotrequireanexpertortechnicalsystemadministratorandwasbuilttomakeiteasytogetstarted.Becauseofitseaseofuseandintegration,ourplatformenablesbusinessestofocusonattracting,engaginganddelightingcustomers,insteadofspendingtimeandmoneycoordi
78、natingtheirmarketingandsaleseffortsacrossmultiplepointapplications.Power of All-In-One Platform.Atthecoreofourplatformisasingleinbounddatabaseforeachbusinessthatcapturesitscustomeractivitythroughoutthecustomerlifecycle.Forexample,ourplatformcreatesaunifiedtimelineincorporatingalltheinteractionswitha
79、particularperson.Ifabusinessscustomervisitsitswebsite,commentsonitsblog,opensanemailitsent,interactswiththebusinessonTwitter,watchesoneofitsvideos,fillsoutaform,orismarkedasasalesopportunitybyitssalesperson,allofthatactivityiscentrallymanagedandpresentedonthetimelineforthatcontactandisavailableforus
80、eacrossourapplications.Ourplatformalsomakesiteasytousethecustomerdatatoempowermorepersonalizedinteractionswiththecustomer,suchaspersonalizedsocialmediaalerts,personalizedcontentonabusinessswebsite,personalizedemailsandtargetedalertstoitssalespeople.Clear ROI for Customers.Ourplatformdeliversprovenan
81、dmeasurableresultsforourcustomers.Ourcustomersoftenexperiencesignificantincreasesinthevolumeoftraffictotheirwebsites,thevolumeofinboundleadsandtherateofconvertingleadsintocustomers.Scalability.Ourplatformwasdesignedandbuilttoservealargenumberofcustomersofanysizeandwithdemandingusecases.Ourplatformcu
82、rrentlyprocessesbillionsofdatapointseachweek,andweuseleadingglobalcloudinfrastructureprovidersandourownautomationtechnologytodynamicallyallocatecapacitytohandleprocessingworkloadsofallsizes.Wehavebuiltourplatformonmoderntechnologies,includingHBaseandHadoop,whichwebelievearemorescalablethantraditiona
83、ldatabasetechnologies.Ourscalabilitygivesusflexibilityforfuturegrowthandenablesustoservicealargevarietyofbusinessesofdifferentsizesacrossdifferentindustries.Extendable and Open Architecture.OurplatformfeaturesavarietyofopenAPIsthatallowseasyintegrationofourplatformwithotherapplications.Weenableourcu
84、stomerstoconnectourplatformtotheirotherapplications,includingCRMandecommerceapplications.Byconnectingthird-partyapplications,ourcustomerscanleverageourcentralizedinbounddatabasetoperformadditionalfunctionsandanalysis.5Our Competitive StrengthsWebelievethatourmarketleadershippositionisbasedonthefollo
85、wingkeystrengths:Leading Platform.Wehavedesignedandbuiltaworld-class,inboundmarketingandsalessoftwareplatform.Webelieveourcustomerschooseourplatformoverothersbecauseofitspowerful,integratedandeasytouseapplications.Independentcustomerreviewsandratingsofourplatformcomparedtootherapplicationsshowthatwe
86、havehighcustomersatisfaction.AsofDecember31,2015onG2Crowd(anindependentbusinesssoftwareandservicesreviewwebsite),thefeaturesandfunctionsofourplatformwereranked#1incustomersatisfactioninthefollowingcategories:marketingautomation,emailmarketing,andsearchmarketing.Market Leadership and Strong Brand.Wea
87、rearecognizedthoughtleaderinthecloud-basedinboundmarketingandsalessoftwareindustrywithaleadingbrand.Ourfounders,BrianHalliganandDharmeshShah,wrotethebest-sellingmarketingbookInbound Marketing:Get Found Using Google,Social Media andBlogs.Morethan90,000copieshavebeensoldandisavailableinninelanguages.T
88、herearemorethan150self-organizedHubSpotusergroups.Wealsohaveover1.8millionfollowersandfansamongTwitter,FacebookandLinkedInasofDecember31,2015,includingapproximately133,000membersofLinkedInwhobelongtoourinboundmarketersgroup.OurINBOUNDconferenceisoneofthelargestinboundindustryconferenceeventswithatte
89、ndanceincreasingfrom1,100in2011toover14,000registeredattendeesin2015.Wecurrentlyholdtheworldrecordforthelargestonlinemarketingseminarwith10,899liveparticipants.Webelievethatitisinherentlyhardtoreplicatethenumberofwebsitesthatlinktous,thevolumeofusefulcontentwehavepublished,ourlargesocialmediafollowi
90、ng,thebreadthofoursearchenginerankingsandouroverallbrandstrengthbecausetheseassetscannotbeeasilypurchasedorbuilt.Large and Growing Agency Partner Program.Morethan2,900agenciespartnerwithusforthevalueofourplatformtotheirbusinessincludingbeingabletooffernewinboundmarketingandsalesservicestotheirclient
91、swhichcangrowtheirrevenuepercustomer,attractnewcustomersandincreasetheportionoftheirclientsonaretainerrelationship.Webelievethatthewideadoptionofourplatforminthemarketingagencyindustryisevidencethatwearebecominganindustrystandard.Marketingagencypartnersandcustomersreferredtousbyourmarketingagencypar
92、tnersrepresentedapproximately49%ofourcustomersasofDecember31,2015andapproximately39%ofourrevenuefortheyearendedDecember31,2015.Thesemarketingagencypartnershelpustopromotethevisionoftheinboundexperience,efficientlyreachnewmid-marketbusinessesatscaleandprovideourmutualcustomerswithmorediverseandhigher
93、-touchservices.Mid-Market Focus.Webelievewehavesignificantcompetitiveadvantagesreachingmid-marketbusinessesandefficientlyreachthismarketatscaleasaresultofourproveninboundgo-to-marketapproachandouragencypartnerchannel.In2015,over83%ofthenewleadswegeneratedandover90%ofournewcustomerswerefrominboundmar
94、ketinganddidnothaveanyadvertisingcostsassociatedwiththem.Webelieveourlargeinboundmarketingfootprintandagencypartnerprogramprovidecompetitiveadvantagesinreachingmid-marketbusinesses.Powerful Network Effects.Wehavebuiltalargeandgrowingecosystemaroundourplatformandcompany.Wehavebuiltwhatwebelieveisthel
95、argestengagedaudienceinourindustry,whichnowcomprisesmorethan4millionpeoplebetweenvisitorstoourblogs,Twitterfollowers,Facebookfans,LinkedInconnections.Wehaveattractedmorethan2,900marketingagencypartnersworldwidewhopromoteourbrandandextendourmarketingandsalesreach.Thousandsofourcustomersintegratethird
96、-partyapplicationswithourplatformusingourbuilt-inconnectorsandthird-partydeveloperpartners.Wehavetrainedandcertifiedmorethan27,000marketersoninboundmarketing.OurannualINBOUNDconferenceattractedmorethan14,000registeredattendeesin2015.Webelievethisecosystemdrivesmorebusinessesandprofessionalstoembrace
97、theinboundplaybook.Asourengagedaudiencegrows,moreagenciespartnerwithus,morethird-partydevelopersintegratetheirapplicationswithourplatform,andmoreprofessionalscompleteourcertificationprograms,allofwhichdrivemorebusinessestoadoptourplatform.Our Growth StrategyThekeyelementstoourgrowthstrategyare:Grow
98、Our U.S.Customer Base.Themarketforourplatformislargeandunderserved.Mid-marketbusinessesareparticularlyunderservedbyexistingpointapplicationvendorsandoftenlacksufficientresourcestoimplementcomplexsolutions.Ourall-in-oneplatformallowsmid-marketbusinessestoefficientlyadoptandexecuteaneffectiveinboundma
99、rketingstrategytohelpthemexpandandgrow.Wewillcontinuetoleverageourinboundgo-to-marketapproachandournetworkofmarketingagencypartnerstokeepgrowingourdomesticbusiness.6Increase Revenue from Existing Customers.With18,116customersinmorethan90countriesspanningmanyindustries,webelievewehaveasignificantoppo
100、rtunitytoincreaserevenuefromourexistingcustomers.Weplantoincreaserevenuefromourexistingcustomersbyexpandingtheiruseofourplatform,sellingtootherpartsoftheirorganizationsandupsellingadditionalofferingsandfeatures.Ourscalablepricingmodelallowsustocapturemorespendasourcustomersgrow,increasethenumberofth
101、eircustomersandprospectsmanagedonourplatform,andrequireadditionalfunctionalityavailablefromourhigherpricetiersandadd-ons,providinguswithasubstantialopportunitytoincreasethelifetimevalueofourcustomerrelationships.Keep Expanding Internationally.Thereisasignificantopportunityforourinboundplatformoutsid
102、eoftheUnitedStates.AsofDecember31,2015,approximately27%ofourcustomerswerelocatedoutsideoftheUnitedStatesandthesecustomersgeneratedapproximately24%ofourtotalrevenuefortheyearendedDecember31,2015,andweselltothoseforeigncustomersfromourU.S.,European,andAsiaPacificbasedoperations.Weintendtogrowourpresen
103、ceininternationalmarketsthroughadditionalinvestmentsinlocalsales,marketingandprofessionalservicecapabilities,aswellasbyleveragingouragencypartnernetwork.WeopenedourfirstinternationalofficeinDublin,IrelandfocusedontheEuropeanmarketinJanuary2013andoursecondandthirdinternationalofficesfocusedontheAsiaP
104、acificmarketinSydney,AustraliainAugust2014andSingaporeinOctober2015,respectively.WealreadyhavesignificantwebsitetrafficfromregionsoutsidetheUnitedStatesandwebelievethatmarketsoutsidetheUnitedStatesrepresentasignificantgrowthopportunity.Continue to Innovate and Expand Our Platform.Mid-marketbusinesse
105、sareincreasinglyrealizingthevalueofhavinganintegratedmarketing,salesandserviceplatform.Webelievewearewellpositionedtocapitalizeonthisopportunitybyintroducingnewproductsandapplicationstoextendthefunctionalityofourplatform.Forexample,in2013,welaunchedourSidekickproductdesignedtoempowersalesprofessiona
106、lstobenefitfromreal-timeinteractiondatatoengagewiththeirmostrelevantprospects.In2015,welaunchedtwonewadd-onstothemarketingplatform:HubSpotReporting,whichenablesmarketingandsalesuserstoexplorethedatawithintheirmarketingplatformusingcustomanalyticsandreports;andHubSpotAdswhichwaslaunchedinpartnershipw
107、ithGoogleandLinkedInandenablescustomerstomanagetheiradspendfromwithintheHubSpotproduct.Welaunchedafreemiummarketingproductin2015calledLeadin,enablingcustomerstoanalyzetheirwebsitetrafficandgeneratemoreleadsfromtheirwebsite.Wealsolaunchedanewpaidsalesproductin2015calledSidekickforBusiness,whichisanex
108、pansionoffourSidekickproductlineandenablesSalesrepstoidentify,connect,andengagewithnewleads.Finally,weaddedsignificantfunctionalitytoourcoremarketing,salesandCRMproductsthroughouttheyear,launchingupdatesthatincludearedesignofourcorecontentmanagementsystem,anewpredictiveleadscoringapplication,andanew
109、integrationsplatformcalledHubSpotConnect.Selectively Pursue Acquisitions.Weplantoselectivelypursueacquisitionsofcomplementarybusinesses,technologiesandteamsthatwouldallowustoaddnewfeaturesandfunctionalitiestoourplatformandacceleratethepaceofourinnovation.Our ProductsAll-in-one Marketing and Sales Pl
110、atformDesignedfromthegrounduptodeliveraninboundexperience,oursoftwareplatformenablesbusinessestoattract,engageanddelightcustomers.Atthecoreofourplatformisasingleinbounddatabaseofcustomerinformation.Thisallowsacompleteviewofcustomerinteractionsacrossallofourintegratedapplications,givingourplatformsub
111、stantialpower.Thisintegrationmakesitpossibletopersonalizewebcontent,socialmediaengagementandemailmessagesacrossdevices,includingmobile.Theintegratedapplicationsonourplatformhaveacommonuserinterface,areaccessedthroughasingleloginandarebasedonourinbounddatabase.Content Optimization System(COS).OurCOSa
112、pplicationsarepartcontentmanagementsystemandpartpersonalizationengine,enablingbusinessestocreatenewandeditexistingwebcontentwhilealsopersonalizingtheirwebsitesfordifferentvisitorsandoptimizingtheirwebsitestoconvertmorevisitorsintoleadsandcustomers.Featuresinclude:Business Blogging Designedforleadgen
113、eration,ourblogincludes“get-as-you-type”SEOtipsforhowtoimprovearticles,built-insocialmediaintegrationtoautomaticallypostnewarticlesinsocialmedia,mobileoptimizationthatautomaticallyoptimizespostsforsmartphonesandtablets,andintegratedanalyticsthatallowmarketerstoseetheperformanceofeachpostandtheirblog
114、gingoverall.Website Pages Aflexiblesystemtobuildmodernwebsiteswithresponsivedesign,whichmeanswebsitesaredynamicallyoptimizedfordesktops,laptops,tabletsandsmartphoneswithouttheneedformaintainingdifferentwebsiteversionsforeachdevicetype.Smart Content Displaycustomizedtext,imagesorothercontenttocustome
115、rstoprovideapersonalizedexperiencebasedonanyinformationstoredintheinbounddatabase.Landing Pages and Forms Easilybuildlead-captureformsandcreatelandingpageswiththeabilitytotestandoptimizedifferentdesignstoimproveconversionrates.7Calls-to-Action Createbuttonsandcalloutsthatdirectvisitorstolandingpages
116、,withtheabilitytooptimizeclick-throughratesbytestingdifferentdesignsandmessages.Search Engine Optimization(SEO).OurSEOapplicationsaretightlyintegratedintoallofthecontentapplicationsonourplatform,makingiteasytoselecttherightkeywordsandoptimizecontenttoattractmorevisitorsfromsearchengines.Featuresincl
117、ude:Keywords Identifywhichsearchtermsareusedmorefrequentlyandarebetteropportunities,andtrackresultsoneachkeyword.Page Performance Generateautomateddiagnosticreportsaboutwhichwebpagesarenotproperlyoptimized,includinginstructionsonwhattofixandhowtofixit.Social Inbox.Oursocialmediaapplicationsallowbusi
118、nessestomonitor,publishandtracksocialmediaacrossFacebook,LinkedIn,TwitterandGoogle+,leveragingthepersonalizedinformationabouteachcontactstoredintheinbounddatabase.Featuresinclude:Monitoring Monitorsocialmediamessagesnotjustforkeywords,butalsousingsegmentedlistscreatedbasedoncriteriaintheinbounddatab
119、asesuchasactivesalesopportunitiesorcustomerswhopurchasedinthelast30days,andsetalertstobesentwhennewmessagesarepostedmeetingthesecriteria.Publishing SchedulemessagestobepostedatanytimeinmultipleTwitteraccounts,aswellaspersonalpages,businesspagesandgroupsonLinkedIn,Google+andFacebook.Analysis Measurew
120、hichpostsgetthemostengagementincludingthenumberofwebsitevisits,newcontactsandnewcustomersgeneratedfromeachpost.Marketing Automation and Email.Businessescanexecute,manageandanalyzesophisticatedemailmarketingcampaignsandsegmentandpersonalizeemailsusingsophisticatedtriggerssuchasviewingavideo,completin
121、gaform,orinteractingviasocialmedia.Featuresinclude:Advanced Segmentation Usealltheinformationintheinbounddatabasetocreatehighlysegmentedgroupsformorepersonalizedandengagingemailmarketing.Personalization Dynamicallypersonalizethecontentofemailsincludingthesender,imagesandtextbasedontheinformationabou
122、ttherecipientintheinbounddatabase.Sophisticated Campaign Workflows Createsophisticatedmarketingautomationworkflowsthatcontinuetoautomaticallyengageleadsbyusing,forexample,timedelaysofvariouslengthsandmultiplefollowupemailsthatarecustomizedbasedondifferentuseractionsorbehavior.Lead Scoring Createacus
123、tomleadscorebasedonthebehaviorandattributesofapotentialcustomer,suchasvisitingaspecificwebpage,watchingcertainvideos,openingcertainemails,havingacertainjobtitle,orothercustomdataintheinbounddatabase.DefinewhichleadsaresenttotheCRMsystemforsalesengagementbasedonthesecriteria.Analysis Measureemailopen
124、rates,click-throughratesandotheremailmarketingmetrics.Sidekick.OurSidekick productenhancestheproductivityofsalesrepresentatives.Businessescantrackthesignalsbeingsentbypotentialcustomersincludingemailengagementandwebsitevisits,andeasilydiscovernewcontactsandconnectionswithotherbusinessesenablingsales
125、representativestofocusonprospectswhohavedemonstratedinterest.Featuresinclude:Email Engagement Notifications Getreal-timealertswhenemailmessagesareopenedorclickedbypotentialcustomerstoknowwhentheyareengagedwithmessages.New Lead and Website Visit Alerts Receiverealtimenotificationsofnewleadsassignedto
126、asalespersonaswellasnotificationsaboutwhenandwhereanexistingleadvisitsabusinessswebsitetohelpsalespeoplemoreeasilyengagewithpotentialcustomers.Email Templates and CRM Tracking UorHubSpotCRMdirectlyinMicrosoftOutlookandGmail.LogemailsinaCRMsoteamscandeliverabetteroverallexperiencetoprospects.Contact
127、Insights Learnaboutmorecontactsatapotentialcustomerwhenvisitingitswebsiteorsendinganemail,identifyotherconnectionstoapotentialcustomerandaddnewcontactstoaCRMwithoneclick.Sidekick for Business.OurSidekick for Business productenhancestheproductivityandeffectivenessofsalesrepresentatives.Businessescane
128、mpowertheirteamswithtoolsthatdeliverapersonalizedexperienceforprospectswithlessworkforsales8representatives.Salesprofessionalscantrackthesignalsbeingsentbypotentialcustomers,includingemailengagementandweb-sitevisits,andeasilydiscovernewcontactsandconnectionswithotherbusinesses.Featuresinclude:Email
129、Engagement Notifications Getreal-timealertswhenemailmessagesareopenedorclickedbypotentialcustomerstoknowwhentheyareengagedwithmessages.Sequences Scheduleaseriesofpersonalizedemailstobesenttoaprospectallatoncetoeliminateremindersandextensivetasklists.Meetings Exposeasalesrepresentativescalendarforpro
130、spectstobookmeetingsatatimemostconvenientforthem,withouthavingtocoordinateapreferredmeetingtimeoveremail.Calling CallprospectsfromHubSpotCRM,Outlook,orGmailandhavethecallloggedautomaticallywithinHubSpotCRM.New Lead and Website Visit Alerts Receivereal-timenotificationsofnewleadsassignedtoasalesperso
131、naswellasnotificationsaboutwhenandwhereanexistingleadvisitsabusinessswebsitetohelpsalespeoplemoreeasilyengagewithpotentialcustomers.Email Templates and CRM Tracking UorHubSpotCRMdirectlyinMicrosoftOutlookandGmail.LogemailsinaCRMsoteamscandeliverabetteroverallexperiencetoprospects.Contact Insights Le
132、arnaboutmorecontactsatapotentialcustomerwhenvisitingitswebsiteorsendinganemail,identifyotherconnectionstoapotentialcustomerandaddnewcontactstoaCRMwithoneclick.CRM Sync.BusinessescansynchronizeinformationfromourinbounddatabasewiththeirCRMapplication,enablingseamlesstransitionfrommarketingtosales.Ourn
133、ativeandthird-partyCRMintegrationfeaturesinclude:Bi-directional Syncing ChangesinHubSpotandtheCRMareautomaticallyupdatedintheothersystemregardlessofwheretheinformationoriginated.Inclusion Lists DefinewhichleadsautomaticallysynctotheCRMbysettingconditionsbasedonleadscoreoranyothercriteriaintheinbound
134、database.Lead Intelligence InformationfromthecontacttimelinesuchasrecentwebsitevisitorsocialmediaengagementisdisplayedintheCRMmakingiteasyforsalestoleveragethedataintheinbounddatabase.Closed Loop Reporting Trackwhichmarketingactivitywastheoriginalsourceofanewcustomerandmeasureinaggregatewhichcampaig
135、nsaredrivingmoreorlesssales.HubSpot CRM.Businessescantracktheirinteractionswithcontactsandcompanies,managetheirsalesactivitiesandreportontheirpipelineandsales.Contact Management Managecontactinformationforpeopleandcompanies.Trackthehistoryofeveryinteractionwiththosecontacts.Salesforce Automation Tra
136、ckactivesalesdeals,storenotes,trackcallsandmeetings,andcreatetasksandremindersforfollow-upwithcustomers.Pipeline Reporting Reportonwhatdealsareinwhatstageofthesalesprocesswithvisibilityforsalesrepresentativesandaggregatereportingforsalesmanagers.Reporting and Analytics.Businessescanuseourreportingan
137、danalyticsfunctionalitybuiltintoourplatformtomeasurewhichactivitiesareattractingthemostnewleadsandcustomers,developadeeperunderstandingoftheircustomersandmeasuretheeffectivenessofcampaignsacrossthecustomerlifecycle.Sources Trackwebsitevisitors,newleadsandnewcustomersaccordingtohowtheyfirstfoundabusi
138、ness,helpingtomeasuretheeffectivenessofdifferentmarketingchannels.Competitors Trackkeyinboundmetricsagainstcompetitionincludingthenumberofinboundlinks,socialmediafollowersandtherelativewebsitetraffic.Campaigns Createcollectionsofdifferentmarketingandsalesassetslikeblogposts,emails,landingpagesandkey
139、wordsandtrackthemallinoneplacetomeasuretheimpactofaspecificmarketingandsalescampaign.Attribution Identifywhatmarketingactivityledtoakeyeventinthemarketingandsalesprocess,suchasconversionintoaleadorapurchase,usingvariousanalyticalmodels.9Events Trackandanalyzeavarietyofcustomeventssuchasvideoviewsorc
140、ustomwebpageinteractionstounderstandtheeffectthoseactionshaveonleadgenerationandsales.Revenue Reportontherevenuegeneratedbymarketingandsalesactivity,includingsegmentationbydealstage,amountandclosedate.Product PackagingIn2012,webeganpricingandpackagingourproductsbasedonproductplans,numberofcontactsan
141、dadd-ons.Wesellthreeproductplans,eachofwhichincludeskeyfunctionalityofourcoreplatformbutalsoincludesdifferentapplicationstomeettheneedsofthevariousbusinessesweserve.HubSpot Basic isourentrylevelplanstartingat$2,400peryear.Thisplanincludesourplatformwithapplicationssuchasblogging,landingpages,SocialI
142、nbox,emailmarketing,andanalyticsandreporting.HubSpot Pro isourplanforprofessionalmarketersstartingat$9,600peryear.ThisplanincludestheplatformwithalltheapplicationsincludedinHubSpotBasicplusmoreadvancedapplicationssuchasCRMintegration,marketingautomationandsmartcontent.HubSpot Enterprise isanadvanced
143、planformarketingteamsstartingat$28,800peryear.ThisplanincludesourplatformwithalltheapplicationsincludedinHubSpotPro,plusmoresophisticatedapplicationssuchasA/Btestingandoptimization,trackingcustomeventsandadvancedreportingcapabilities.Pricingforallplansisonasubscriptionbasisandcustomerspayadditionalf
144、eesabovethestartingpricesbasedonhowmanycontactswillbestoredandtrackedintheinbounddatabase.Wegenerateadditionalrevenuebasedonthepurchaseofadditionalsubscriptionsandapplicationsandthenumberofaccountusers,subdomainsandwebsitevisits.Add Ons.Wealsosellapplicationsthatarenotincludedinanyofourthreeplansona
145、nadd-onbasis.Website allowsabusinesstobuild,editandmanageanentirewebsiteonourplatform.Websitehasaper-monthfeeinadditiontothefeepaidforourinboundplatform,whichisrequiredtouseWebsite.Sidekick notifiessalespeopleoftheactivityoftheirmosthighlyengagedpotentialcustomers.TheStarterversionisfreeandincludesa
146、limitednumberofnotificationsandfeatures,whilethePowerUserversionhasaper-userfeeandincludesunlimitednotificationsandallavailablefeatures.Sidekick for Business isapremiumversionoftheSidekickproductthatgivesusersunlimitedaccesstotheoriginalSidekickproducttoolsplusadditionalfeaturessuchasphonecallintegr
147、ationdirectlywithinthewebbrowserthatautomaticallyrecordsandlogscallstoCRM,personalizedemailtemplates,unifieddocumentmanagementforsalesandmarketingandeffectivenessreportingforemailtemplatesandsalescollateral.ThefreeversionofSidekickforBusinessincludesalimitednumberoftemplates,documentuploadsand15minu
148、tesofcallingperuserpermonth,whilethepaidversionincludesunlimitedtemplatesanddocumentsand1,000minutesofcallingperuserpermonth.Ads providesadvertisingcampaigncreation,managementandROIreportingforLinkedInSponsoredUpdatesandGooglesAdWordscampaignsforamonthlyfee.Reports consolidatesalloftheessentialrepor
149、tsintoonecustomizablescreenforbothmarketingandsalestoviewallmetricsinoneplaceforamonthlyfee.Our ServicesWecomplementourproductofferingswithprofessionalservicesandsupport.Themajorityofourservicesandsupportisofferedoverthephoneandviawebmeetingtechnologyratherthanin-person,whichisamoreefficientbusiness
150、modelforusandmorecost-effectiveforourcustomers.Professional Services.Weofferprofessionalservicestoeducateandtraincustomersonhowtoleverageoursoftwareplatformandinboundmarketingmethodologytotransformhowtheirbusinessattracts,engagesanddelightscustomers.Dependingonwhichproductplanandprofessionalservices
151、acustomerbuys,iteitherreceivesgrouptrainingandeducationinonlineorin-personclassesorone-on-onetrainingandadvicefromoneofourimplementationspecialistsbyphoneandwebmeeting.Ourprofessionalservicesarealsoavailabletocustomerswhoneedadditionalassistanceonaone-timeorongoingbasisforanadditionalfee.Support.Ina
152、dditiontoassistanceprovidedbyouronlinearticlesandcustomerdiscussionforums,weofferphoneandemail-basedsupportstaffedintheUnitedStates,Ireland,Australia,andSingapore,whichisincludedinthecostofasubscriptionforour10marketingproduct.Westrivetomaintainanexceptionalqualityofcustomerservice.Wecontinuouslymon
153、itorkeycustomerservicemetricssuchasphoneholdtime,ticketresponsetimeandticketresolutionrates,andwemonitorthecustomersatisfactionofourcustomersupportinteractions.Webelieveourcustomersupportisanimportantreasonwhybusinesseschooseourplatformandrecommendittotheircolleagues.Our CustomersAsofDecember31,2015
154、wehad18,116customersinmorethan90countries,representingmanyindustries.Nosinglecustomerrepresentedmorethan1%ofourrevenuein2015,2014or2013.Our TechnologyWehave18,116customersthathavechosenusastheirmarketingandsalesplatform,whichwearchitectedandbuilttobesecure,highlydistributedandhighlyscalable.Sinceour
155、founding,wehaveembracedrapid,iterativeproductdevelopmentlifecycles,cloudautomationandopen-sourcetechnologies,includingbigdataplatforms,topowermarketingandsalesprogramsandprovideinsightsnotpreviouslypossibleoravailable.Ourplatformisamulti-tenant,singlecode-based,globallyavailablesoftware-as-a-service
156、deliveredthroughwebbrowsersormobileapplications.Ourcommitmenttoahighlyavailable,reliableandscalableplatformforbusinessesofallsizesisaccomplishedthroughtheuseofthesetechnologies.Modern Database Architecture.Weprocessbillionsofdatapointsweeklyacrossvariouschannels,includingsocialmedia,email,SEOandwebs
157、itevisits,andcontinuetodrivenearlyreal-timeanalyticsacrossthesechannels.ThisispossiblebecausewebuiltourdatabasefromthegroundupusingdistributedbigdatatechnologiessuchasHBaseandHadooptobothprocessandanalyzethelargeamountsofdatawecollectinourinbounddatabase.Usingmoderndatabasetechnologies,wecanprovidea
158、ctionableinsightsacrossdisparatedata-setsinamannernoteasilyachievableorcosteffectively,atscaleorefficiently,withtraditionaldatabasesorplatformarchitectures.Agility.Ourinfrastructureanddevelopmentandsoftwarereleaseprocessesallowustoupdateourplatformforspecificgroupsofcustomersorourentirecustomerbasea
159、tanytime.Thismeanswecanrapidlyinnovateanddelivernewfunctionalityfrequently,withoutwaitingforquarterlyorannualreleasecycles.Wetypicallydeployupdatestooursoftwareplatformhundredsoftimesaweek,enablingustogatherimmediatecustomerfeedbackandimproveourproductquicklyandcontinuously.Cost leverage.Becauseourp
160、latformwasbuiltonanalmostexclusivefootprintofopen-sourcesoftwareanddesignedtooperateincloud-baseddata-centers,wehavebenefitedfromlarge-scalepricereductionsbythesecloudcomputingserviceprovidersastheycontinuetoinnovateandcompeteformarketshare.Asourprocessingvolumecontinuestogrow,wecontinuetoreceivelar
161、gervolumediscountsonaper-unitbasisforcostssuchascostforstorage,bandwidthandcomputingcapacity.Wealsobelievethatourextensiveuse,andcontributionto,open-sourcesoftwarewillprovideadditionalleverageaswescaleourplatformandinfrastructure.Scalability.Byleveragingleadingcloudinfrastructureprovidersalongwithou
162、rautomatedtechnologystack,weareabletoscaleworkloadsofvaryingsizesatanytime.Thisallowsustohandlecustomersofallsizesanddemandswithouttraditionaloperationallimitationssuchasnetworkbandwidth,computingcycles,orstoragecapacityaswecanscaleourplatformon-demand.Reliability.Ourplatformsuptimeduring2015exceede
163、d99.9%whilewedeliveredhundredsofproductimprovementsthroughthousandsofsoftwarereleasesinacontinuoussoftwaredeliverycycle.Customerdataisdistributedandprocessedacrossmultipledatacenterswithinaregiontoprovideredundancy.Webuiltourplatformonadistributedcomputingarchitecturewithnosinglepointsoffailureandwe
164、operateacrossdata-centerboundariesdaily.Inadditiontodata-centerlevelredundancy,thisarchitecturesupportsmultiplelivecopiesofeachdatasetalongwithsnapshotcapabilitiesforfaster,point-in-timedatarecoveryinsteadoftraditionalbackupandrestoremethodologies.Security.Weleverageindustrystandardnetworkandperimet
165、erdefensetechnologies,DDoSprotectionsystems(includingwebapplicationfirewalls)andenterprisegradeDNSservicesacrossmultiplevendors.Ourdata-centerprovidersoperateandcertifytohighindustrycompliancelevels.Duetothebroadfootprintofourcustomerbase,weregularlytestandevaluateourplatformwithtrustedthird-partyve
166、ndorstoensurethesecurityandintegrityofourservices.Marketing and SalesWebelieveweareagloballeaderinimplementinganinboundexperienceinmarketingandsales.Webelievethatourmarketingandsalesmodelprovidesuswithacompetitiveadvantage,especiallywhentargetingmid-marketbusinesses,becausewecanattractandengagethese
167、businessesefficientlyandatscale.11Inbound Marketing.Ourmarketingteamfocusesoninboundmarketingandattractsover57,000newleadspermonththroughourindustry-leadingblogandothercontent,freetools,largesocialmediafollowing,highsearchenginerankingsandpersonalizedwebsiteandemailcontent.Inboundsourcesgeneratedove
168、r90%ofournewcustomersandover83%ofnewleadsduring2015.Webelievemostcompaniesofoursizeandscaletypicallyhaveafarlowervolumeofleadgenerationwithamuchlargershareofitcomingfromtraditionaladvertisingmethods.Inbound Direct Sales.OursalesrepresentativesarebasedinourofficesinCambridge,Massachusetts,Dublin,Irel
169、and,Sydney,Australia,andSingaporeandusephone,emailandwebmeetingstointeractwithprospectsandcustomers.Thevastmajorityofrevenuegeneratedbyoursalesrepresentativesoriginateswithinboundleadsproducedbyourmarketingefforts.Inbound Channel Sales.Inadditiontoourdirectsalesteam,wehavesalesrepresentativesthatman
170、agerelationshipswithourworldwidenetworkofmarketingagencypartnerswhobothuseourplatformfortheirownbusinessesandalso,onacommissionedbasis,refercustomerstous.Thesemarketingagenciespartnerwithusnotonlytoleverageoursoftwareplatformandeducationalresources,butalsotobuildtheirownbusinessbyofferingnewservices
171、andshiftingtheirrevenuemixtoincludemoreretainer-basedbusinesswitharecurringrevenuestream.Employees and CultureTransformingthebusinessworldtoembracetheinboundexperiencerequiresatrulyremarkableteam.Fromtheverybeginning,ourcompanywasfoundedonafundamentalbeliefinradicaltransparency,individualautonomyand
172、enlightenedempathy.Tothatend,wepublishedour“CultureCode,”adocumentcodifyinghowwewentaboutbuildingabusinessthatemployees,customersandpartnersaliketrulylove.OurCultureCodeslidedeckhasbeenviewedapproximately2milliontimesonLinkedInsSlideShareandbecomeanimportantelementofourrecruitingefforts.Thesevencore
173、principlesofourCultureCodeare:We commit maniacally to both our mission and metrics.Ourmissionistomaketheworldinboundandtransformhoworganizationsattract,engageanddelighttheircustomers.We look to the long-term and“Solve for the Customer”.Wesolveforthecustomer,company,teamandself,inthatorder.We share o
174、penly and are remarkably transparent.Webelievethatpowerisgainedbysharingknowledge,nothoardingitandwesharenearlyallbusinessinformationwithallofouremployeesnomattertheirtitleorposition.We favor autonomy and take ownership.Wetrustandempowereachemployeetousegoodjudgment,andbelievethatresultsshouldmatter
175、morethanwhenorwheretheyareproducedandthatinfluenceshouldbeindependentofhierarchy.We believe our best perk is amazing people.Wevaluepeoplewhoarehumble,effectiveandpredisposedtoaction,adaptabletochange,remarkablestandoutsandtransparentwithothersandwiththemselves.We dare to be different and question th
176、e status quo.Webelievethatremarkableoutcomesrarelyresultfrommodestrisk,andwedratherbefailingfrequentlythannevertryingnewthings.We recognize that life is short.Weencouragecandorandcriticismasithelpsusgrow,butrememberlifeisshortsoalwaysbecaringandkind.Wetakegreatprideinrecruitingandretainingpeoplewith
177、HEART:Humility,Effectiveness,Adaptability,Remark-abilityandTransparency,ateverylevelofourcompanyandhireemployeespassionateaboutjoiningourmissiontotransformthebusinessworldwithinbound.In2015,wewererecognizedbytheBostonGlobeastheTopPlacetoWorkamonglargecompanies,aBestPlacetoWorkforWomen,Camaraderieand
178、TechnologybyFortune,andinDecember2015itwasannouncedwerankedinthetop5ofBestPlacestoWorkin2016byGlassdoor.Ourpoliciesonemployeeautonomyandtransparencyhavebeenwidelyprofiledinthemediaandweareincrediblyproudoftheculturethatwehavebuilt.But,attheendoftheday,wedonotjusttalkaboutculture,wemeasureit,justaswe
179、dotherestofourbusiness.Wesurveyemployeesonaquarterlybasis,makingsurethatourfoundersandexecutivesreviewallthefeedback,respond,andmakeadjustmentswhennecessary.AsofDecember31,2015wehad1,157full-timeemployees.Oftheseemployees,960arebasedintheUnitedStates,166arelocatedinIreland,22arelocatedinAustralia,an
180、d9arelocatedinSingapore.12CompetitionOurmarketisevolving,highlycompetitiveandfragmented,andweexpectcompetitiontoincreaseinthefuture.Webelievetheprincipalcompetitivefactorsinourmarketare:visionforthemarketandproductstrategyandpaceofinnovation;inboundmarketingfocusanddomainexpertise;integratedall-in-o
181、neplatform;breadthanddepthofproductfunctionality;easeofuse;scalable,openarchitecture;timetovalueandtotalcostofownership;integrationwiththird-partyapplicationsanddatasources;andnamerecognitionandbrandreputation.Webelievewecompletefavorablywithrespecttoallofthesefactors.Wefaceintensecompetitionfromoth
182、ersoftwarecompaniesthatdevelopmarketingsoftwareandfrommarketingservicescompaniesthatprovideinteractivemarketingservices.Ourcompetitorsoffervariouspointapplicationsthatprovidecertainfunctionsandfeaturesthatweprovide,including:cloud-basedmarketingautomationproviders;emailmarketingsoftwarevendors;sales
183、forceautomationandCRMsoftwarevendors;andlarge-scaleenterprisesuites.Inaddition,insteadofusingourplatform,someprospectivecustomersmayelecttocombinedisparatepointapplications,suchascontentmanagement,marketingautomation,analyticsandsocialmediamanagement.Weexpectthatnewcompetitors,suchasenterprisesoftwa
184、revendorsthathavetraditionallyfocusedonenterpriseresourceplanningorotherapplicationssupportingbackofficefunctions,willdevelopandintroduce,oracquire,applicationsservingcustomer-facingandotherfrontofficefunctions.Intellectual PropertyOurabilitytoprotectourintellectualproperty,includingourtechnology,wi
185、llbeanimportantfactorinthesuccessandcontinuedgrowthofourbusiness.Weprotectourintellectualpropertythroughtradesecretslaw,copyrights,trademarksandcontracts.Someofourtechnologyreliesuponthird-partylicensedintellectualproperty.Inadditiontotheforegoing,wehaveestablishedbusinessproceduresdesignedtomaintai
186、ntheconfidentialityofourproprietaryinformation,includingtheuseofconfidentialityagreementsandassignmentofinventionsagreementswithemployees,independentcontractors,consultantsandcompanieswithwhichweconductbusiness.Financial Information About SegmentsTheCompanyoperatesasoneoperatingsegment.Operatingsegm
187、entsaredefinedascomponentsofanenterpriseforwhichseparatefinancialinformationisregularlyevaluatedbythechiefoperatingdecisionmakers(“CODMs”),whicharetheCompanyschiefexecutiveofficerandchiefoperatingofficer,indecidinghowtoallocateresourcesandassessperformance.TheCompanysCODMsevaluatetheCompanysfinancia
188、linformationandresourcesandassesstheperformanceoftheseresourcesonaconsolidatedbasis.SincetheCompanyoperatesinoneoperatingsegment,allrequiredfinancialsegmentinformationcanbefoundintheconsolidatedfinancialstatements.SeeFootnote7withintheconsolidatedfinancialstatementsforinformationbygeographicarea.Ava
189、ilable InformationOurAnnualReportonForm10-K,QuarterlyReportsonForm10-Q,CurrentReportsonForm8-KandamendmentstoreportsfiledpursuanttoSections13(a)and15(d)oftheSecuritiesExchangeActof1934,asamended, assoonasreasonablypracticableaftersuchreportsarefiledwith,orfurnishedto,theSEC.13TheSECalsomaintainsaweb
190、site,www.sec.gov,thatcontainsreportsandotherinformationregardingissuersthatfileelectronicallywiththeSEC.ThepublicmayreadandcopyanyfileswiththeSECPublicReferenceRoomat100FStreet,NE,Washington,DC20549.ThepublicmayobtaininformationontheoperationofthePublicReferenceRoombycalling1-800-SEC-0330.Wearenot,h
191、owever,includingtheinformationcontainedonourwebsite,orinformationthatmaybeaccessedthroughlinksonourwebsite,aspartof,orincorporatingsuchinformationbyreferenceinto,thisAnnualReportonForm10-K.ITEM 1A.RISK FACTORSAn investment in our common stock involves a high degree of risk.You should carefully consi
192、der the risks described below and the other information in thisAnnual Report on Form 10-K and in our other public filings before making an investment decision.Our business,prospects,financial condition,or operatingresults could be harmed by any of these risks,as well as other risks not currently kno
193、wn to us or that we currently consider immaterial.If any of such risks anduncertainties actually occurs,our business,financial condition or operating results could differ materially from the plans,projections and other forward-lookingstatements included in the section titled“Managements Discussion a
194、nd Analysis of Financial Condition and Results of Operations”and elsewhere in this reportand in our other public filings.The trading price of our common stock could decline due to any of these risks,and,as a result,you may lose all or part of yourinvestment.Risks Related to Our Business and Strategy
195、We have a history of losses and may not achieve profitability in the future.Wegeneratednetlossesof$46.1millionin2015,$48.2millionin2014,andof$34.3millionin2013.AsofDecember31,2015,wehadanaccumulateddeficitof$200.4million.Wewillneedtogenerateandsustainincreasedrevenuelevelsinfutureperiodstobecomeprof
196、itable,and,evenifwedo,wemaynotbeabletomaintainorincreaseourlevelofprofitability.Weintendtocontinuetoexpendsignificantfundstogrowourmarketingandsalesoperations,developandenhanceourinboundplatform,scaleourdatacenterinfrastructureandservicescapabilitiesandexpandintonewmarkets.Oureffortstogrowourbusines
197、smaybemorecostlythanweexpect,andwemaynotbeabletoincreaseourrevenueenoughtooffsetourhigheroperatingexpenses.Wemayincursignificantlossesinthefutureforanumberofreasons,includingtheotherrisksdescribedinthisAnnualReportonForm10-K,andunforeseenexpenses,difficulties,complicationsanddelaysandotherunknowneve
198、nts.Ifweareunabletoachieveandsustainprofitability,themarketpriceofourcommonstockmaysignificantlydecrease.We are dependent upon customer renewals,the addition of new customers and the continued growth of the market for an inbound platform.Wederive,andexpecttocontinuetoderive,asubstantialportionofourr
199、evenuefromthesaleofsubscriptionstoourinboundmarketingplatform.Themarketforinboundmarketingandsalesproductsisstillevolving,andcompetitivedynamicsmaycausepricinglevelstochangeasthemarketmaturesandasexistingandnewmarketparticipantsintroducenewtypesofpointapplicationsanddifferentapproachestoenablebusine
200、ssestoaddresstheirrespectiveneeds.Asaresult,wemaybeforcedtoreducethepriceswechargeforourplatformandmaybeunabletorenewexistingcustomeragreementsorenterintonewcustomeragreementsatthesamepricesanduponthesametermsthatwehavehistorically.Our subscription renewal rates may decrease,and any decrease could h
201、arm our future revenue and operating results.Ourcustomershavenoobligationtorenewtheirsubscriptionsforourplatformaftertheexpirationoftheirsubscriptionperiods,substantiallyallofwhichareoneyearorless.Inaddition,ourcustomersmayseektorenewforlowersubscriptionamountsorforshortercontractlengths.Also,custom
202、ersmaychoosenottorenewtheirsubscriptionsforavarietyofreasons,includinganinabilityorfailureonthepartofacustomertocreateblogging,socialmediaandothercontentnecessarytorealizethebenefitsofourplatform.Ourrenewalratesmaydeclineorfluctuateasaresultofanumberoffactors,includinglimitedcustomerresources,pricin
203、gchanges,adoptionandutilizationofourplatformandadd-onapplicationsbyourcustomers,adoptionofournewproducts,customersatisfactionwithourplatform,theacquisitionofourcustomersbyothercompaniesanddeterioratinggeneraleconomicconditions.Ifourcustomersdonotrenewtheirsubscriptionsforourplatformordecreasetheamou
204、nttheyspendwithus,ourrevenuewilldeclineandourbusinesswillsuffer.We face significant competition from both established and new companies offering marketing and sales software and other related applications,as well asinternally developed software,which may harm our ability to add new customers,retain
205、existing customers and grow our business.Themarketingandsalessoftwaremarketisevolving,highlycompetitiveandsignificantlyfragmented.Withtheintroductionofnewtechnologiesandthepotentialentryofnewcompetitorsintothemarket,weexpectcompetitiontopersistandintensifyinthefuture,whichcouldharmourabilitytoincrea
206、sesales,maintainorincreaserenewalsandmaintainourprices.14Wefaceintensecompetitionfromothersoftwarecompaniesthatdevelopmarketingandsalessoftwareandfrommarketingservicescompaniesthatprovideinteractivemarketingservices.Competitioncouldsignificantlyimpedeourabilitytosellsubscriptionstoourinboundmarketin
207、gandsalesplatformontermsfavorabletous.Ourcurrentandpotentialcompetitorsmaydevelopandmarketnewtechnologiesthatrenderourexistingorfutureproductslesscompetitive,orobsolete.Inaddition,ifthesecompetitorsdevelopproductswithsimilarorsuperiorfunctionalitytoourplatform,wemayneedtodecreasethepricesoracceptles
208、sfavorabletermsforourplatformsubscriptionsinordertoremaincompetitive.Ifweareunabletomaintainourpricingduetocompetitivepressures,ourmarginswillbereducedandouroperatingresultswillbenegativelyaffected.Ourcompetitorsinclude:cloud-basedmarketingautomationproviders;emailmarketingsoftwarevendors;salesforce
209、automationandCRMsoftwarevendors;andlarge-scaleenterprisesuites.Inaddition,insteadofusingourplatform,someprospectivecustomersmayelecttocombinedisparatepointapplications,suchascontentmanagement,marketingautomation,CRM,analyticsandsocialmediamanagement.Weexpectthatnewcompetitors,suchasenterprisesoftwar
210、evendorsthathavetraditionallyfocusedonenterpriseresourceplanningorotherapplicationssupportingbackofficefunctions,willdevelopandintroduceapplicationsservingcustomer-facingandotherfrontofficefunctions.Thisdevelopmentcouldhaveanadverseeffectonourbusiness,operatingresultsandfinancialcondition.Inaddition
211、,salesforceautomationandCRMsystemvendorscouldacquireordevelopapplicationsthatcompetewithourmarketingsoftwareofferings.Someofthesecompanieshaveacquiredsocialmediamarketingandothermarketingsoftwareproviderstointegratewiththeirbroaderofferings.Ourcurrentandpotentialcompetitorsmayhavesignificantlymorefi
212、nancial,technical,marketingandotherresourcesthanwehave,beabletodevotegreaterresourcestothedevelopment,promotion,saleandsupportoftheirproductsandservices,mayhavemoreextensivecustomerbasesandbroadercustomerrelationshipsthanwehave,andmayhavelongeroperatinghistoriesandgreaternamerecognitionthanwehave.As
213、aresult,thesecompetitorsmayrespondfastertonewtechnologiesandtoundertakemoreextensivemarketingcampaignsfortheirproducts.Inafewcases,thesevendorsmayalsobeabletooffermarketingandsalessoftwareatlittleornoadditionalcostbybundlingitwiththeirexistingsuiteofapplications.Totheextentanyofourcompetitorshasexis
214、tingrelationshipswithpotentialcustomersforeithermarketingsoftwareorotherapplications,thosecustomersmaybeunwillingtopurchaseourplatformbecauseoftheirexistingrelationshipswithourcompetitor.Ifweareunabletocompetewithsuchcompanies,thedemandforourinboundplatformcouldsubstantiallydecline.Inaddition,ifoneo
215、rmoreofourcompetitorsweretomergeorpartnerwithanotherofourcompetitors,ourabilitytocompeteeffectivelycouldbeadverselyaffected.Ourcompetitorsmayalsoestablishorstrengthencooperativerelationshipswithourcurrentorfuturestrategicdistributionandtechnologypartnersorotherpartieswithwhomwehaverelationships,ther
216、ebylimitingourabilitytopromoteandimplementourplatform.Wemaynotbeabletocompetesuccessfullyagainstcurrentorfuturecompetitors,andcompetitivepressuresmayharmourbusiness,operatingresultsandfinancialcondition.We have experienced rapid growth and organizational change in recent periods and expect continued
217、 future growth.If we fail to manage our growtheffectively,we may be unable to execute our business plan,maintain high levels of service or address competitive challenges adequately.Ourheadcountandoperationshavegrownsubstantially.Forexample,wehad1,157full-timeemployeesasofDecember31,2015,ascomparedwi
218、th785asofDecember31,2014.WeopenedourfirstinternationalofficeinDublin,IrelandinJanuary2013,asecondinternationalofficeinSydney,AustraliainAugust2014,andathirdinternationalofficeinSingaporeinOctober2015.WehaveannouncedourintentiontoopenaninternationalofficeinJapaninthesecondhalfof2016.Thisgrowthhasplac
219、ed,andwillcontinuetoplace,asignificantstrainonourmanagement,administrative,operationalandfinancialinfrastructure.Weanticipatefurthergrowthwillberequiredtoaddressincreasesinourproductofferingsandcontinuedexpansion.Oursuccesswilldependinpartuponourabilitytorecruit,hire,train,manageandintegrateasignifi
220、cantnumberofqualifiedmanagers,technicalpersonnelandemployeesinspecializedroleswithinourcompany,includingintechnology,salesandmarketing.Ifournewemployeesperformpoorly,orifweareunsuccessfulinrecruiting,hiring,training,managingandintegratingthesenewemployees,orretainingtheseorourexistingemployees,ourbu
221、sinessmaysuffer.Inaddition,tomanagetheexpectedcontinuedgrowthofourheadcount,operationsandgeographicexpansion,wewillneedtocontinuetoimproveourinformationtechnologyinfrastructure,operational,financialandmanagementsystemsandprocedures.Ouranticipatedadditionalheadcountandcapitalinvestmentswillincreaseou
222、rcosts,whichwillmakeitmoredifficultforustoaddressanyfuturerevenueshortfallsbyreducingexpensesintheshortterm.Ifwefailtosuccessfullymanageourgrowth,wewillbeunable15tosuccessfullyexecuteourbusinessplan,whichcouldhaveanegativeimpactonourbusiness,resultsofoperationsorfinancialcondition.Failure to effecti
223、vely develop and expand our marketing and sales capabilities could harm our ability to increase our customer base and achieve broadermarket acceptance of our platform.Toincreasetotalcustomersandachievebroadermarketacceptanceofourinboundplatform,wewillneedtoexpandourmarketingandsalesoperations,includ
224、ingoursalesforceandthird-partychannelpartners.Wewillcontinuetodedicatesignificantresourcestoinboundsalesandmarketingprograms.Theeffectivenessofourinboundsalesandmarketingandthird-partychannelpartnershasvariedovertimeandmayvaryinthefutureanddependsonourabilitytomaintainandimproveourinboundplatform.Al
225、loftheseeffortswillrequireustoinvestsignificantfinancialandotherresources.Ourbusinesswillbeseriouslyharmedifoureffortsdonotgenerateacorrespondinglysignificantincreaseinrevenue.Wemaynotachieveanticipatedrevenuegrowthfromexpandingoursalesforceifweareunabletohire,developandretaintalentedsalespersonnel,
226、ifournewsalespersonnelareunabletoachievedesiredproductivitylevelsinareasonableperiodoftimeorifoursalesandmarketingprogramsarenoteffective.The rate of growth of our business depends on the continued participation and level of service of our marketing agency partners.Werelyonourmarketingagencypartners
227、toprovidecertainservicestoourcustomers,aswellaspursuesalesofourinboundplatformtocustomers.Marketingagencypartnersandcustomersreferredtousbyourmarketingagencypartnersrepresentedapproximately49%ofourcustomersasofDecember31,2015,and39%ofourrevenuefortheyearendedDecember31,2015.Totheextentwedonotattract
228、newmarketingagencypartners,orexistingornewmarketingagencypartnersdonotreferagrowingnumberofcustomerstous,ourrevenueandoperatingresultswouldbeharmed.Inaddition,ifourmarketingagencypartnersdonotcontinuetoprovideservicestoourcustomers,wewouldberequiredtoprovidesuchservicesourselveseitherbyexpandingouri
229、nternalteamorengagingotherthird-partyproviders,whichwouldincreaseouroperatingcosts.If we cannot maintain our company culture as we grow,we could lose the innovation,teamwork,passion and focus on execution that we believe contribute toour success and our business may be harmed.Webelievethatacriticalc
230、omponenttooursuccesshasbeenourcompanyculture,whichisbasedontransparencyandpersonalautonomy.Wehaveinvestedsubstantialtimeandresourcesinbuildingourteamwithinthiscompanyculture.Anyfailuretopreserveourculturecouldnegativelyaffectourabilitytoretainandrecruitpersonnelandtoeffectivelyfocusonandpursueourcor
231、porateobjectives.Aswegrowasandcontinuetodeveloptheinfrastructureofapubliccompany,wemayfinditdifficulttomaintaintheseimportantaspectsofourcompanyculture.Ifwefailtomaintainourcompanyculture,ourbusinessmaybeadverselyimpacted.If we fail to maintain our inbound thought leadership position,our business ma
232、y suffer.Webelievethatmaintainingourthoughtleadershippositionininboundmarketing,salesandservicesisanimportantelementinattractingnewcustomers.Wedevotesignificantresourcestodevelopandmaintainourthoughtleadershipposition,withafocusonidentifyingandinterpretingemergingtrendsintheinboundexperience,shaping
233、andguidingindustrydialogandcreatingandsharingthebestinboundpractices.Ouractivitiesrelatedtodevelopingandmaintainingourthoughtleadershipmaynotyieldincreasedrevenue,andeveniftheydo,anyincreasedrevenuemaynotoffsettheexpensesweincurredinsucheffort.Werelyuponthecontinuedservicesofourmanagementandemployee
234、swithdomainexpertisewithinboundmarketing,salesandservices,andthelossofanykeyemployeesinthisareacouldharmourcompetitivepositionandreputation.Ifwefailtosuccessfullygrowandmaintainourthoughtleadershipposition,wemaynotattractenoughnewcustomersorretainourexistingcustomers,andourbusinesscouldsuffer.If we
235、fail to further enhance our brand and maintain our existing strong brand awareness,our ability to expand our customer base will be impaired and ourfinancial condition may suffer.WebelievethatourdevelopmentoftheHubSpotbrandiscriticaltoachievingwidespreadawarenessofourexistingandfutureinboundexperienc
236、esolutions,and,asaresult,isimportanttoattractingnewcustomersandmaintainingexistingcustomers.Inthepast,oureffortstobuildourbrandhaveinvolvedsignificantexpenses,andwebelievethatthisinvestmenthasresultedinstrongbrandrecognitioninthebusiness-to-business,orB2B,market.Successfulpromotionandmaintenanceofou
237、rbrandswilldependlargelyontheeffectivenessofourmarketingeffortsandonourabilitytoprovideareliableandusefulinboundplatformatcompetitiveprices.Brandpromotionactivitiesmaynotyieldincreasedrevenue,andeveniftheydo,anyincreasedrevenuemaynotoffsettheexpensesweincurredinbuildingourbrand.Ifwefailtosuccessfull
238、ypromoteandmaintainourbrand,ourbusinesscouldsuffer.16If we fail to adapt and respond effectively to rapidly changing technology,evolving industry sta ndards and changing customer needs or requirements,ourinbound platform may become less competitive.Ourfuturesuccessdependsonourabilitytoadaptandinnova
239、teourinboundplatform.Toattractnewcustomersandincreaserevenuefromexistingcustomers,weneedtocontinuetoenhanceandimproveourofferingstomeetcustomerneedsatpricesthatourcustomersarewillingtopay.Sucheffortswillrequireaddingnewfunctionalityandrespondingtotechnologicaladvancements,whichwillincreaseourresearc
240、handdevelopmentcosts.Ifweareunabletodevelopnewapplicationsthataddressourcustomersneeds,ortoenhanceandimproveourplatforminatimelymanner,wemaynotbeabletomaintainorincreasemarketacceptanceofourplatform.Ourabilitytogrowisalsosubjecttotheriskoffuturedisruptivetechnologies.Accessanduseofourinboundplatform
241、isprovidedviathecloud,which,itself,wasdisruptivetothepreviousenterprisesoftwaremodel.Ifnewtechnologiesemergethatareabletodeliverinboundmarketingsoftwareandrelatedapplicationsatlowerprices,moreefficiently,moreconvenientlyormoresecurely,suchtechnologiescouldadverselyaffectourabilitytocompete.We rely o
242、n our management team and other key employees,and the loss of one or more key employees could harm our business.Oursuccessandfuturegrowthdependuponthecontinuedservicesofourmanagementteam,includingourco-founders,BrianHalliganandDharmeshShah,andotherkeyemployeesintheareasofresearchanddevelopment,marke
243、ting,sales,servicesandgeneralandadministrativefunctions.Fromtimetotime,theremaybechangesinourmanagementteamresultingfromthehiringordepartureofexecutives,whichcoulddisruptourbusiness.Wealsoaredependentonthecontinuedserviceofourexistingsoftwareengineersandinformationtechnologypersonnelbecauseofthecomp
244、lexityofourplatform,technologiesandinfrastructure.Wemayterminateanyemployeesemploymentatanytime,withorwithoutcause,andanyemployeemayresignatanytime,withorwithoutcause.Wedonothaveemploymentagreementswithanyofourkeypersonnel.Thelossofoneormoreofourkeyemployeescouldharmourbusiness.The failure to attrac
245、t and retain additional qualified personnel could prevent us from executing our business strategy.Toexecuteourbusinessstrategy,wemustattractandretainhighlyqualifiedpersonnel.Inparticular,wecompetewithmanyothercompaniesforsoftwaredeveloperswithhighlevelsofexperienceindesigning,developingandmanagingcl
246、oud-basedsoftware,aswellasforskilledinformationtechnology,marketing,salesandoperationsprofessionals,andwemaynotbesuccessfulinattractingandretainingtheprofessionalsweneed.Also,inboundsales,marketingandservicesdomainexpertsareveryimportanttooursuccessandaredifficulttoreplace.Wehavefromtimetotimeinthep
247、astexperienced,andweexpecttocontinuetoexperienceinthefuture,difficultyinhiringanddifficultyinretaininghighlyskilledemployeeswithappropriatequalifications.Inparticular,wehaveexperiencedacompetitivehiringenvironmentintheGreaterBostonarea,whereweareheadquartered.Manyofthecompanieswithwhichwecompetefore
248、xperiencedpersonnelhavegreaterresourcesthanwedo.Inaddition,inmakingemploymentdecisions,particularlyinthesoftwareindustry,jobcandidatesoftenconsiderthevalueofthestockoptionsorotherequityincentivestheyaretoreceiveinconnectionwiththeiremployment.Ifthepriceofourstockdeclines,orexperiencessignificantvola
249、tility,ourabilitytoattractorretainkeyemployeeswillbeadverselyaffected.Ifwefailtoattractnewpersonnelorfailtoretainandmotivateourcurrentpersonnel,ourgrowthprospectscouldbeseverelyharmed.If we fail to offer high-quality customer support,our business and reputation may suffer.High-qualityeducation,train
250、ingandcustomersupportareimportantforthesuccessfulmarketing,saleanduseofourinboundplatformandfortherenewalofexistingcustomers.Providingthiseducation,trainingandsupportrequiresthatourpersonnelwhomanageouronlinetrainingresource,HubSpotAcademy,orprovidecustomersupporthavespecificinboundexperiencedomaink
251、nowledgeandexpertise,makingitmoredifficultforustohirequalifiedpersonnelandtoscaleupoursupportoperations.Theimportanceofhigh-qualitycustomersupportwillincreaseasweexpandourbusinessandpursuenewcustomers.Ifwedonothelpourcustomersusemultipleapplicationswithinourinboundplatformandprovideeffectiveongoings
252、upport,ourabilitytoselladditionalfunctionalityandservicesto,ortoretain,existingcustomersmaysufferandourreputationwithexistingorpotentialcustomersmaybeharmed.We may not be able to scale our business quickly enough to meet our customers growing needs and if we are not able to grow efficiently,our oper
253、ating resultscould be harmed.Asusageofourinboundplatformgrowsandascustomersuseourplatformforadditionalinboundapplications,suchassalesandservices,wewillneedtodevoteadditionalresourcestoimprovingourapplicationarchitecture,integratingwiththird-partysystemsandmaintaininginfrastructureperformance.Inaddit
254、ion,wewillneedtoappropriatelyscaleourinternalbusinesssystemsandourservicesorganization,includingcustomersupportandprofessionalservices,toserveourgrowingcustomerbase,particularlyasourcustomerdemographicschangeovertime.Anyfailureofordelayintheseeffortscouldcauseimpairedsystemperformanceandreducedcusto
255、mersatisfaction.Theseissuescouldreducetheattractivenessofourinboundplatformtocustomers,resultingindecreasedsalestonewcustomers,lowerrenewalratesbyexistingcustomers,theissuanceofservicecredits,orrequested17refunds,whichcouldimpedeourrevenuegrowthandharmourreputation.Evenifweareabletoupgradeoursystems
256、andexpandourstaff,anysuchexpansionwillbeexpensiveandcomplex,requiringmanagementstimeandattention.Wecouldalsofaceinefficienciesoroperationalfailuresasaresultofoureffortstoscaleourinfrastructure.Moreover,thereareinherentrisksassociatedwithupgrading,improvingandexpandingourinformationtechnologysystems.
257、Wecannotbesurethattheexpansionandimprovementstoourinfrastructureandsystemswillbefullyoreffectivelyimplementedonatimelybasis,ifatall.Theseeffortsmayreducerevenueandourmarginsandadverselyaffectourfinancialresults.Our ability to introduce new products and features is dependent on adequate research and
258、development resources.If we do not adequately fund our researchand development efforts,we may not be able to compete effectively and our business and operating results may be harmed.Toremaincompetitive,wemustcontinuetodevelopnewproductofferings,applications,featuresandenhancementstoourexistinginboun
259、dplatform.Maintainingadequateresearchanddevelopmentpersonnelandresourcestomeetthedemandsofthemarketisessential.Ifweareunabletodevelopourplatforminternallyduetocertainconstraints,suchashighemployeeturnover,lackofmanagementabilityoralackofotherresearchanddevelopmentresources,wemaymissmarketopportuniti
260、es.Further,manyofourcompetitorsexpendaconsiderablygreateramountoffundsontheirresearchanddevelopmentprograms,andthosethatdonotmaybeacquiredbylargercompaniesthatwouldallocategreaterresourcestoourcompetitorsresearchanddevelopmentprograms.Ourfailuretomaintainadequateresearchanddevelopmentresourcesortoco
261、mpeteeffectivelywiththeresearchanddevelopmentprogramsofourcompetitorscouldmateriallyadverselyaffectourbusiness.Changes in the sizes or types of businesses that purchase our platform or in the applications within our inbound platform purchased or used by our customerscould negatively affect our opera
262、ting results.Ourstrategyistosellsubscriptionstoourinboundplatformtomid-sizedbusinesses,butwehavesoldandwillcontinuetoselltoorganizationsrangingfromsmallbusinessestoenterprises.Ourgrossmarginscanvarydependingonnumerousfactorsrelatedtotheimplementationanduseofourinboundplatform,includingthesophisticat
263、ionandintensityofourcustomersuseofourplatformandthelevelofprofessionalservicesandsupportrequiredbyacustomer.Salestoenterprisecustomersmayentaillongersalescyclesandmoresignificantsellingefforts.Sellingtosmallbusinessesmayinvolvegreatercreditriskanduncertainty.Iftherearechangesinthemixofbusinessesthat
264、purchaseourplatformorthemixoftheproductplanspurchasedbyourcustomers,ourgrossmarginscoulddecreaseandouroperatingresultscouldbeadverselyaffected.We have in the past completed acquisitions and may acquire or invest in other companies or technologies in the future,which could divert managementsattention
265、,fail to meet our expectations,result in additional dilution to our stockholders,increase expenses,disrupt our operations or harm our operatingresults.Wehaveinthepastacquired,andwemayinthefutureacquireorinvestin,businesses,productsortechnologiesthatwebelievecouldcomplementorexpandourplatform,enhance
266、ourtechnicalcapabilitiesorotherwiseoffergrowthopportunities.Forexample,inJune2011,weacquiredPerformable,amarketingautomationprovider.Wemaynotbeabletofullyrealizetheanticipatedbenefitsoftheseoranyfutureacquisitions.Thepursuitofpotentialacquisitionsmaydiverttheattentionofmanagementandcauseustoincurvar
267、iousexpensesrelatedtoidentifying,investigatingandpursuingsuitableacquisitions,whetherornottheyareconsummated.Thereareinherentrisksinintegratingandmanagingacquisitions.Ifweacquireadditionalbusinesses,wemaynotbeabletoassimilateorintegratetheacquiredpersonnel,operationsandtechnologiessuccessfullyoreffe
268、ctivelymanagethecombinedbusinessfollowingtheacquisitionandourmanagementmaybedistractedfromoperatingourbusiness.Wealsomaynotachievetheanticipatedbenefitsfromtheacquiredbusinessduetoanumberoffactors,including:unanticipatedcostsorliabilitiesassociatedwiththeacquisition;incurrenceofacquisition-relatedco
269、sts,whichwouldberecognizedasacurrentperiodexpense;inabilitytogeneratesufficientrevenuetooffsetacquisitionorinvestmentcosts;theinabilitytomaintainrelationshipswithcustomersandpartnersoftheacquiredbusiness;thedifficultyofincorporatingacquiredtechnologyandrightsintoourplatformandofmaintainingqualityand
270、securitystandardsconsistentwithourbrand;delaysincustomerpurchasesduetouncertaintyrelatedtoanyacquisition;theneedtointegrateorimplementadditionalcontrols,proceduresandpolicies;challengescausedbydistance,languageandculturaldifferences;harmtoourexistingbusinessrelationshipswithbusinesspartnersandcustom
271、ersasaresultoftheacquisition;thepotentiallossofkeyemployees;useofresourcesthatareneededinotherpartsofourbusinessanddiversionofmanagementandemployeeresources;theinabilitytorecognizeacquireddeferredrevenueinaccordancewithourrevenuerecognitionpolicies;anduseofsubstantialportionsofouravailablecashorthei
272、ncurrenceofdebttoconsummatetheacquisition.Acquisitionsalsoincreasetheriskofunforeseenlegalliability,includingforpotentialviolationsofapplicablelaworindustryrulesandregulations,arisingfrompriororongoingactsoromissionsbytheacquiredbusinesseswhicharenotdiscoveredbyduediligenceduringtheacquisitionproces
273、s.Generally,ifanacquiredbusinessfailstomeetourexpectations,ouroperatingresults,businessandfinancialconditionmaysuffer.Acquisitionscouldalsoresultindilutiveissuancesofequitysecuritiesortheincurrenceofdebt,whichcouldadverselyaffectourbusiness,resultsofoperationsorfinancialcondition.18Inaddition,asigni
274、ficantportionofthepurchasepriceofcompaniesweacquiremaybeallocatedtogoodwillandotherintangibleassets,whichmustbeassessedforimpairmentatleastannually.Ifouracquisitionsdonotultimatelyyieldexpectedreturns,wemayberequiredtomakechargestoouroperatingresultsbasedonourimpairmentassessmentprocess,whichcouldha
275、rmourresultsofoperations.Because our long-term growth strategy involves further expansion of our sales to customers outside the United States,our business will be susceptible to risksassociated with international operations.Acomponentofourgrowthstrategyinvolvesthefurtherexpansionofouroperationsandcu
276、stomerbaseinternationally.AsofDecember31,2015,approximately27%ofourcustomerswerelocatedoutsideoftheUnitedStatesandthesecustomersgeneratedapproximately24%ofourtotalrevenuefortheyearendedDecember31,2015.WeopenedourfirstinternationalofficeinDublin,IrelandinJanuary2013andweopenedadditionalinternationalo
277、fficesinSydney,AustraliainAugust2014,andinSingaporeinOctober2015.WehaveannouncedourintentiontoopenanadditionalinternationalofficeinJapaninthesecondhalfof2016.Theseinternationalofficesfocusprimarilyonsales,professionalservicesandsupport.WealsohaveadevelopmentteaminDublin,Ireland.Ourcurrentinternation
278、aloperationsandfutureinitiativeswillinvolveavarietyofrisks,including:difficultiesinmaintainingourcompanyculturewithadispersedanddistantworkforce;morestringentregulationsrelatingtodatasecurityandtheunauthorizeduseof,oraccessto,commercialandpersonalinformation,particularlyintheEuropeanUnion;unexpected
279、changesinregulatoryrequirements,taxesortradelaws;differinglaborregulations,especiallyintheEuropeanUnion,wherelaborlawsaregenerallymoreadvantageoustoemployeesascomparedtotheUnitedStates,includingdeemedhourlywageandovertimeregulationsintheselocations;challengesinherentinefficientlymanaginganincreasedn
280、umberofemployeesoverlargegeographicdistances,includingtheneedtoimplementappropriatesystems,policies,benefitsandcomplianceprograms;difficultiesinmanagingabusinessinnewmarketswithdiversecultures,languages,customs,legalsystems,alternativedisputesystemsandregulatorysystems;currencyexchangeratefluctuatio
281、nsandtheresultingeffectonourrevenueandexpenses,andthecostandriskofenteringintohedgingtransactionsifwechosetodosointhefuture;limitationsonourabilitytoreinvestearningsfromoperationsinonecountrytofundthecapitalneedsofouroperationsinothercountries;limitedorinsufficientintellectualpropertyprotection;poli
282、ticalinstabilityorterroristactivities;likelihoodofpotentialoractualviolationsofdomesticandinternationalanticorruptionlaws,suchastheU.S.ForeignCorruptPracticesActandtheU.K.BriberyAct,orofU.S.andinternationalexportcontrolandsanctionsregulations,whichlikelihoodmayincreasewithanincreaseofsalesoroperatio
283、nsinforeignjurisdictionsandoperationsincertainindustries;andadversetaxburdensandforeignexchangecontrolsthatcouldmakeitdifficulttorepatriateearningsandcash.Ourlimitedexperienceinoperatingourbusinessinternationallyincreasestheriskthatanypotentialfutureexpansioneffortsthatwemayundertakewillnotbesuccess
284、ful.Ifweinvestsubstantialtimeandresourcestoexpandourinternationaloperationsandareunabletodososuccessfullyandinatimelymanner,ourbusinessandoperatingresultswillsuffer.WecontinuetoimplementpoliciesandprocedurestofacilitateourcompliancewithU.S.lawsandregulationsapplicabletoorarisingfromourinternationalb
285、usiness.Inadequaciesinourpastorcurrentcompliancepracticesmayincreasetheriskofinadvertentviolationsofsuchlawsandregulations,whichcouldleadtofinancialandotherpenaltiesthatcoulddamageourreputationandimposecostsonus.Interruptions or delays in service from our third-party data center providers could impa
286、ir our ability to deliver our platform to our customers,resulting incustomer dissatisfaction,damage to our reputation,loss of customers,limited growth and reduction in revenue.Wecurrentlyservethemajorityofourplatformfunctionsfromthird-partydatacenterhostingfacilitiesoperatedbyAmazonWebServicesandloc
287、atedinnorthernVirginia.Inaddition,weserveancillaryfunctionsforourcustomersfromthird-partydatacenterhostingfacilitiesoperatedbyRackspacelocatedinDallas,Texas,withabackupfacilityinChicago,Illinois.Ouroperationsdepend,inpart,onourthird-partyfacilityprovidersabilitiestoprotectthesefacilitiesagainstdamag
288、eorinterruptionfromnaturaldisasters,powerortelecommunicationsfailures,criminalactsandsimilarevents.Intheeventthatanyofourthird-partyfacilities19arrangementsisterminated,orifthereisalapseofserviceordamagetoafacility,wecouldexperienceinterruptionsinourplatformaswellasdelaysandadditionalexpensesinarran
289、gingnewfacilitiesandservices.Anydamageto,orfailureof,thesystemsofourthird-partyproviderscouldresultininterruptionstoourplatform.Despiteprecautionstakenatourdatacenters,theoccurrenceofspikesinusagevolume,anaturaldisaster,anactofterrorism,vandalismorsabotage,adecisiontocloseafacilitywithoutadequatenot
290、ice,orotherunanticipatedproblemsatafacilitycouldresultinlengthyinterruptionsintheavailabilityofouron-demandsoftware.Evenwithcurrentandplanneddisasterrecoveryarrangements,ourbusinesscouldbeharmed.Also,intheeventofdamageorinterruption,ourinsurancepoliciesmaynotadequatelycompensateusforanylossesthatwem
291、ayincur.Thesefactorsinturncouldfurtherreduceourrevenue,subjectustoliabilityandcauseustoissuecreditsorcausecustomerstofailtorenewtheirsubscriptions,anyofwhichcouldmateriallyadverselyaffectourbusiness.We are dependent on the continued availability of third-party data hosting and transmission services.
292、Asignificantportionofouroperatingcostisfromourthird-partydatahostingandtransmissionservices.Ifthecostsforsuchservicesincreaseduetovendorconsolidation,regulation,contractrenegotiation,orotherwise,wemaynotbeabletoincreasethefeesforourinboundplatformorservicestocoverthechanges.Asaresult,ouroperatingres
293、ultsmaybesignificantlyworsethanforecasted.If we do not or cannot maintain the compatibility of our inbound platform with third-party applications that our customers use in their businesses,our revenuewill decline.Asignificantpercentageofourcustomerschoosetointegrateourplatformwithcertaincapabilities
294、providedbythird-partyapplicationprovidersusingapplicationprogramminginterfaces,orAPIs,publishedbytheseproviders.Thefunctionalityandpopularityofourinboundplatformdepends,inpart,onourabilitytointegrateourplatformwiththird-partyapplicationsandplatforms,includingCRM,CMS,e-commerce,callcenter,analyticsan
295、dsocialmediasitesthatourcustomersuseandfromwhichtheyobtaindata.Third-partyprovidersofapplicationsandAPIsmaychangethefeaturesoftheirapplicationsandplatforms,restrictouraccesstotheirapplicationsandplatformsoralterthetermsgoverninguseoftheirapplicationsandAPIsandaccesstothoseapplicationsandplatformsina
296、nadversemanner.Suchchangescouldfunctionallylimitorterminateourabilitytousethesethird-partyapplicationsandplatformsinconjunctionwithourplatform,whichcouldnegativelyimpactourofferingsandharmourbusiness.Ifwefailtointegrateourplatformwithnewthird-partyapplicationsandplatformsthatourcustomersuseformarket
297、ing,salesorservicespurposes,wemaynotbeabletoofferthefunctionalitythatourcustomersneed,whichwouldnegativelyimpactourabilitytogeneraterevenueandadverselyimpactourbusiness.We rely on data provided by third parties,the loss of which could limit the functionality of our platform and disrupt our business.
298、Selectfunctionalityofourinboundplatformdependsonourabilitytodeliverdata,includingsearchengineresultsandsocialmediaupdates,providedbyunaffiliatedthirdparties,suchasFacebook,Google,LinkedInandTwitter.Someofthisdataisprovidedtouspursuanttothird-partydatasharingpoliciesandtermsofuse,underdatasharingagre
299、ementsbythird-partyprovidersorbycustomerconsent.Inthefuture,anyofthesethirdpartiescouldchangeitsdatasharingpolicies,includingmakingthemmorerestrictive,oralteritsalgorithmsthatdeterminetheplacement,display,andaccessibilityofsearchresultsandsocialmediaupdates,anyofwhichcouldresultinthelossof,orsignifi
300、cantimpairmentto,ourabilitytocollectandprovideusefuldatatoourcustomers.Thesethirdpartiescouldalsointerpretour,orourserviceproviders,datacollectionpoliciesorpracticesasbeinginconsistentwiththeirpolicies,whichcouldresultinthelossofourabilitytocollectthisdataforourcustomers.Anysuchchangescouldimpairour
301、abilitytodeliverdatatoourcustomersandcouldadverselyimpactselectfunctionalityofourplatform,impairingthereturnoninvestmentthatourcustomersderivefromusingoursolution,aswellasadverselyaffectingourbusinessandourabilitytogeneraterevenue.Privacy concerns and end users acceptance of Internet behavior tracki
302、ng may limit the applicability,use and adoption of our inbound platform.Privacyconcernsmaycauseenduserstoresistprovidingthepersonaldatanecessarytoallowourcustomerstouseourplatformeffectively.Wehaveimplementedvariousfeaturesintendedtoenableourcustomerstobetterprotectenduserprivacy,butthesemeasuresmay
303、notalleviateallpotentialprivacyconcernsandthreats.Eventheperceptionofprivacyconcerns,whetherornotvalid,mayinhibitmarketadoptionofourplatform,especiallyincertainindustriesthatrelyonsensitivepersonalinformation.Privacyadvocacygroupsandthetechnologyandotherindustriesareconsideringvariousnew,additionalo
304、rdifferentself-regulatorystandardsthatmayplaceadditionalburdensonus.Thecostsofcompliancewith,andotherburdensimposedbythesegroupspoliciesandactionsmaylimittheuseandadoptionofourinboundplatformandreduceoveralldemandforit,orleadtosignificantfines,penaltiesorliabilitiesforanynoncomplianceorlossofanysuch
305、action.20We are subj ect to governmental regulation and other legal obligations,particularly related to privacy,data protection and information security,and our actualor perceived failure to comply with such obligations could harm our business.Compliance with such laws co uld also impair our efforts
306、 to maintain andexpand our customer base,and thereby decrease our revenue.Ourhandlingofdataissubjecttoavarietyoflawsandregulations,includingregulationbyvariousgovernmentagencies,includingtheU.S.FederalTradeCommission,orFTC,andvariousstate,localandforeignagencies.Wecollectpersonallyidentifiableinform
307、ationandotherdatafromourcustomersandleads.Wealsohandlepersonallyidentifiableinformationaboutourcustomerscustomers.Weusethisinformationtoprovideservicestoourcustomers,tosupport,expandandimproveourbusiness.Wemayalsosharecustomerspersonallyidentifiableinformationwiththirdpartiesasauthorizedbythecustome
308、rorasdescribedinourprivacypolicy.TheU.S.federalandvariousstateandforeigngovernmentshaveadoptedorproposedlimitationsonthecollection,distribution,useandstorageofpersonalinformationofindividuals.IntheUnitedStates,theFTCandmanystateattorneysgeneralareapplyingfederalandstateconsumerprotectionlawsasimposi
309、ngstandardsfortheonlinecollection,useanddisseminationofdata.However,theseobligationsmaybeinterpretedandappliedinamannerthatisinconsistentfromonejurisdictiontoanotherandmayconflictwithotherrequirementsorourpractices.Anyfailureorperceivedfailurebyustocomplywithprivacyorsecuritylaws,policies,legaloblig
310、ationsorindustrystandardsoranysecurityincidentthatresultsintheunauthorizedreleaseortransferofpersonallyidentifiableinformationorothercustomerdatamayresultingovernmentalenforcementactions,litigation,finesandpenaltiesand/oradversepublicity,andcouldcauseourcustomerstolosetrustinus,whichcouldhaveanadver
311、seeffectonourreputationandbusiness.Someproposedlawsorregulationsconcerningprivacy,dataprotectionandinformationsecurityareintheirearlystages,andwecannotyetdeterminetheimpacttheselawsandregulations,ifimplemented,mayhaveonourbusiness.Suchlawsandregulationsmayrequirecompaniestoimplementprivacyandsecurit
312、ypolicies,permituserstoaccess,correctanddeletepersonalinformationstoredormaintainedbysuchcompanies,informindividualsofsecuritybreachesthataffecttheirpersonalinformation,and,insomecases,obtainindividualsconsenttousepersonalinformationforcertainpurposes.Inaddition,aforeigngovernmentcouldrequirethatany
313、personalinformationcollectedinacountrynotbedisseminatedoutsideofthatcountry,andwearenotcurrentlyequippedtocomplywithsucharequirement.Otherproposedlegislationcould,ifenacted,imposeadditionalrequirementsandprohibittheuseofcertaintechnologiesthattrackindividualsactivitiesonwebpagesorthatrecordwhenindiv
314、idualsclickthroughtoaninternetaddresscontainedinanemailmessage.Suchlawsandregulationscouldrequireustochangefeaturesofourplatformorrestrictourcustomersabilitytocollectanduseemailaddresses,pageviewingdataandpersonalinformation,whichmayreducedemandforourplatform.Ourfailuretocomplywithfederal,stateandin
315、ternationaldataprivacylawsandregulationscouldharmourabilitytosuccessfullyoperateourbusinessandpursueourbusinessgoals.Inaddition,severalforeigncountriesandgovernmentalbodies,includingtheEuropeanUnionandCanada,haveregulationsdealingwiththecollectionanduseofpersonalinformationobtainedfromtheirresidents
316、,whichareoftenmorerestrictivethanthoseintheUnitedStates.Lawsandregulationsinthesejurisdictionsapplybroadlytothecollection,use,storage,disclosureandsecurityofpersonalinformationthatidentifiesormaybeusedtoidentifyanindividual,suchasnames,emailaddressesandinsomejurisdictions,InternetProtocol,orIP,addre
317、sses.Suchregulationsandlawsmaybemodifiedandnewlawsmaybeenactedinthefuture.WithintheEuropeanUnion,legislatorsarecurrentlyconsideringarevisiontothe1995EuropeanUnionDataProtectionDirectivethatwouldincludemorestringentoperationalrequirementsforprocessorsandcontrollersofpersonalinformationandthatwouldimp
318、osesignificantpenaltiesfornon-compliance.WehaveinthepastreliedonadherencetotheU.S.DepartmentofCommercesSafeHarborPrivacyPrinciplesandcompliancewiththeU.S.-EUandU.S.-SwissSafeHarborFrameworks,whichestablishedameansforlegitimatingthetransferofpersonallyidentifiableinformationbyU.S.companiesdoingbusine
319、ssinEuropefromtheEuropeanEconomicArea,orEEA,totheU.S.AsaresultoftheOctober6,2015EuropeanUnionCourtofJustice,orECJ,opinionintheSchremsv.DataProtectionCommissionercase,theU.S.EUSafeHarborFrameworkisnolongerdeemedtobeavalidmethodofcompliancewithrestrictionssetforthintheDataProtectionDirective(andmember
320、statesimplementationsthereof)regardingthetransferofdataoutsideoftheEEA.InlightoftheECJopinion,weareofferingothermethodstoourcustomerstoenablecompliantdatatransfersfromtheEEAtotheU.S.WemaybeunsuccessfulinestablishingameansforthetransferofdatafromtheEEAthatisacceptabletoourcustomers.Inaddition,datapro
321、tectionregulationisanareaofincreasedfocusandchangingrequirements.Dataprotectionregulationsarecurrentlybeingreviewedandareexpectedtochangeinthefuture.ThereisnoassurancethatwewillbeabletomeetnewrequirementsthatmaybeimposedonthetransferofpersonallyidentifiableinformationfromtheEUtotheUSwithoutincurring
322、substantialexpenseoratall.WemayexperiencereluctanceorrefusalbyEuropeanormulti-nationalcustomerstopurchaseorcontinuetouseourservicesduetoconcernsregardingtheirdataprotectionobligations.WemayfinditnecessarytoestablishadditionalsystemstomaintainEU-origindataintheEEA,whichmayinvolvesubstantialexpenseand
323、distractionfromotheraspectsofourbusiness.Inaddition,ifourprivacyordatasecuritymeasuresfailtocomplywithcurrentorfuturelawsandregulations,wemaybesubjecttoclaims,legalproceedingsorotheractionsbyindividualsorgovernmentalauthoritiesbasedonprivacyordataprotectionregulationsandourcommitmentstocustomersorot
324、hers,aswellasnegativepublicityandapotentiallossof21business.Moreover,iffuturelawsandregulationslimitoursubscribersabilitytouseandsharepersonalinformationorourabilitytostore,processandsharepersonalinformation,demandforoursolutionscoulddecrease,ourcostscouldincrease,andourbusiness,resultsofoperationsa
325、ndfinancialconditioncouldbeharmed.Newinterpretationsofexistinglaws,regulationsorstandardscouldrequireustoincuradditionalcostsandrestrictourbusinessoperations,andanyfailurebyustocomplywithapplicablerequirementsmayresultingovernmentalenforcementactions,litigation,finesandpenaltiesoradversepublicity,wh
326、ichcouldhaveanadverseeffectonourreputationandbusiness.If our or our customers security measures are compromised or unauthorized access to data of our customers or their customers is otherwise obtained,ourinbound platform may be perceived as not being secure,our customers may be harmed and may curtai
327、l or cease their use of our platform,our reputation maybe damaged and we may incur significant liabilities.Ouroperationsinvolvethestorageandtransmissionofdataofourcustomersandtheircustomers,includingpersonallyidentifiableinformation.Ourstorageistypicallythesolesourceofrecordforportionsofourcustomers
328、businessesandenduserdata,suchasinitialcontactinformationandonlineinteractions.Securityincidentscouldresultinunauthorizedaccessto,lossoforunauthorizeddisclosureofthisinformation,litigation,indemnityobligationsandotherpossibleliabilities,aswellasnegativepublicity,whichcoulddamageourreputation,impairou
329、rsalesandharmourcustomersandourbusiness.Cyber-attacksandothermaliciousInternet-basedactivitycontinuetoincreasegenerally,andcloud-basedplatformprovidersofmarketingserviceshavebeentargeted.Ifoursecuritymeasuresarecompromisedasaresultofthird-partyaction,employeeorcustomererror,malfeasance,stolenorfraud
330、ulentlyobtainedlog-incredentialsorotherwise,ourreputationcouldbedamaged,ourbusinessmaybeharmedandwecouldincursignificantliability.Ifthirdpartieswithwhomwework,suchasvendorsordevelopers,violateapplicablelawsoroursecuritypolicies,suchviolationsmayalsoputourcustomersinformationatriskandcouldinturnhavea
331、nadverseeffectonourbusiness.Inaddition,ifthesecuritymeasuresofourcustomersarecompromised,evenwithoutanyactualcompromiseofourownsystems,wemayfacenegativepublicityorreputationalharmifourcustomersoranyoneelseincorrectlyattributestheblameforsuchsecuritybreachestousoroursystems.Wemaybeunabletoanticipateo
332、rpreventtechniquesusedtoobtainunauthorizedaccessortosabotagesystemsbecausetheychangefrequentlyandgenerallyarenotdetecteduntilafteranincidenthasoccurred.Asweincreaseourcustomerbaseandourbrandbecomesmorewidelyknownandrecognized,wemaybecomemoreofatargetforthirdpartiesseekingtocompromiseoursecuritysyste
333、msorgainunauthorizedaccesstoourcustomersdata.Additionally,weprovideextensiveaccesstoourdatabase,whichstoresourcustomerdata,toourdevelopmentteamtofacilitateourrapidpaceofproductdevelopment.Ifsuchaccessorourownoperationscausetheloss,damageordestructionofourcustomersbusinessdata,theirsales,leadgeneration,supportandotherbusinessoperationsmaybepermanentlyharmed.Asaresult,ourcustomersmaybringclaimsagain
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