S-1 1 d898181ds1.htm FORM S-1
       
          Table of Contents
       
          As filed with the Securities and Exchange Commission on February 25,
          2021
       
          Registration No. 333-            
       
          UNITED STATES
       
          SECURITIES AND EXCHANGE COMMISSION
       
          WASHINGTON, D.C. 20549
       
          FORM S-1
       
          REGISTRATION STATEMENT
       
          UNDER
       
          THE SECURITIES ACT OF 1933
       
          DigitalOcean Holdings, Inc.
       
          (Exact name of Registrant as specified in its charter)
       
          Delaware
       
          7370
       
          45-5207470
       
          (State or other jurisdiction of
          incorporation or organization)
       
          (Primary Standard Industrial
          Classification Code Number)
       
          (I.R.S. Employer
          Identification Number)
       
          101 6th Avenue
       
          New York, New York 10013
       
          (646) 827-4366
       
          (Address, including zip code, and telephone number, including
       
          area code, of Registrant’s principal executive offices)
       
          Yancey Spruill
       
          Chief Executive Officer
       
          DigitalOcean Holdings, Inc.
       
          101 6th Avenue
       
          New York, New York 10013
       
          (646) 827-4366
       
          (Name, address, including zip code, and telephone number, including
          area code, of agent for service)
       
          Copies to:
       
          Eric Jensen
       
          Brandon Fenn
          Cooley LLP
          55 Hudson Yards
          New York, New York 10001
          (212) 479-6000
       
          William Sorenson
       
          Alan Shapiro
       
          DigitalOcean Holdings, Inc.
          101 6th Avenue
          New York, New York 10013
          (646) 827-4366
       
          Michael Benjamin
       
          Latham & Watkins LLP
       
          885 Third Avenue
       
          New York, New York 10022
       
          (212) 906-1200
       
          Approximate date of commencement of proposed sale to the public:
       
          As soon as practicable after this registration statement becomes
          effective.
       
          If any of the securities being registered on this Form are to be
          offered on a delayed or continuous basis pursuant to Rule 415 under
          the Securities Act of 1933, check the following box. ☐
       
          If this Form is filed to register additional securities for an
          offering pursuant to Rule 462(b) under the Securities Act, check the
          following box and list the Securities Act registration statement
          number of the earlier effective registration statement for the same
          offering. ☐
       
          If this Form is a post-effective amendment filed pursuant to Rule
          462(c) under the Securities Act, check the following box and list the
          Securities Act registration statement number of the earlier effective
          registration statement for the same offering. ☐
       
          If this Form is a post-effective amendment filed pursuant to Rule
          462(d) under the Securities Act, check the following box and list the
          Securities Act registration statement number of the earlier effective
          registration statement for the same offering. ☐
       
          Indicate by check mark whether the registrant is a large accelerated
          filer, an accelerated filer, a non-accelerated filer, a smaller
          reporting company or an emerging growth company. See the definitions
          of “large accelerated filer,” “accelerated filer,” “smaller reporting
          company” and “emerging growth company” in Rule 12b-2 of the Exchange
          Act.
       
          Large accelerated filer
       
          ☐
       
          Accelerated filer
       
          ☐
       
          Non-accelerated filer
       
          ☒
       
          Smaller reporting company
       
          ☐
       
          Emerging growth company
       
          ☒
       
          If an emerging growth company, indicate by check mark if the
          registrant has elected not to use the extended transition period for
          complying with any new or revised financial accounting standards
          provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
       
          CALCULATION OF REGISTRATION FEE
       
          Title of Each Class of Securities
          to be Registered
       
          Proposed Maximum
          Aggregate Offering
          Price(1)(2)
       
          Amount of
          Registration Fee
       
          Common stock, par value $0.000025 per share
       
          $100,000,000
       
          $10,910
       
          (1)
       
          Estimated solely for the purpose of calculating the registration fee
          in accordance with Rule 457(o) of the Securities Act of 1933, as
          amended.
       
          (2)
       
          Includes the aggregate offering price of additional shares that the
          underwriters have the option to purchase, if any.
       
          The Registrant hereby amends this Registration Statement on such date
          or dates as may be necessary to delay its effective date until the
          Registrant will file a further amendment which specifically states
          that this Registration Statement will thereafter become effective in
          accordance with Section 8(a) of the Securities Act of 1933, as
          amended, or until the Registration Statement will become effective on
          such date as the Securities and Exchange Commission, acting pursuant
          to said Section 8(a), may determine.
       
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          The information in this preliminary prospectus is not complete and may
          be changed. These securities may not be sold until the registration
          statement filed with the Securities and Exchange Commission is
          effective. This preliminary prospectus is not an offer to sell nor
          does it seek an offer to buy these securities in any jurisdiction
          where the offer or sale is not permitted.
       
          Subject to Completion. Dated                , 2021.
       
                      Shares
       
          LOGO
       
          Common Stock
       
          This is the initial public offering of shares of common stock of
          DigitalOcean Holdings, Inc.
       
          Prior to this offering, there has been no public market for our common
          stock. It is currently estimated that the initial public offering
          price will be between $                and $                per share.
          We have applied to list our common stock on the New York Stock
          Exchange under the symbol “DOCN.”
       
          We are an “emerging growth company” as defined under the federal
          securities laws and, as such, we have elected to comply with certain
          reduced reporting requirements for this prospectus and may elect to do
          so in future filings.
       
          See “Risk Factors” beginning on page 13 to read about factors you
          should consider before buying our common stock.
       
          Neither the Securities and Exchange Commission nor any other
          regulatory body has approved or disapproved of these securities or
          passed upon the accuracy or adequacy of this prospectus. Any
          representation to the contrary is a criminal offense.
       
          Per Share
       
          Total
       
          Initial public offering price
       
          $               
       
          $           
       
          Underwriting discount (1)
       
          $               
       
          $           
       
          Proceeds, before expenses, to us
       
          $               
       
          $           
       
          (1)
       
          See the section titled “Underwriting” for additional information
          regarding compensation payable to the underwriters.
       
          We have granted the underwriters the right to purchase up to an
          additional                shares of common stock from us at the
          initial public offering price less the underwriting discount.
       
          The underwriters expect to deliver the shares against payment in New
          York, New York on or about                 , 2021.
       
          Morgan Stanley
       
          Goldman Sachs & Co. LLC
       
          J.P. Morgan
       
          BofA Securities
       
          Barclays
       
          KeyBanc Capital Markets
       
          Canaccord Genuity
       
          JMP Securities
       
          Stifel
       
          Prospectus dated                , 2021.
       
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          Page
       
          A LETTER FROM YANCEY SPRUILL, OUR CHIEF EXECUTIVE OFFICER
       
          ii
       
          PROSPECTUS SUMMARY
       
          1
       
          RISK FACTORS
       
          13
       
          SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
       
          50
       
          MARKET, INDUSTRY AND OTHER DATA
       
          51
       
          USE OF PROCEEDS
       
          52
       
          DIVIDEND POLICY
       
          53
       
          CAPITALIZATION
       
          54
       
          DILUTION
       
          56
       
          SELECTED CONSOLIDATED FINANCIAL DATA
       
          58
       
          MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS
       
          62
       
          BUSINESS
       
          82
       
          MANAGEMENT
       
          110
       
          Page
       
          EXECUTIVE COMPENSATION
       
          119
       
          CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
       
          131
       
          PRINCIPAL STOCKHOLDERS
       
          133
       
          DESCRIPTION OF CAPITAL STOCK
       
          135
       
          SHARES ELIGIBLE FOR FUTURE SALE
       
          140
       
          MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES TO NON-U.S. HOLDERS OF
          OUR COMMON STOCK
       
          143
       
          UNDERWRITING
       
          147
       
          LEGAL MATTERS
       
          155
       
          EXPERTS
       
          155
       
          WHERE YOU CAN FIND ADDITIONAL INFORMATION
       
          156
       
          INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
       
          F-1
       
          Neither we nor any of the underwriters have authorized anyone to
          provide any information or to make any representations other than
          those contained in this prospectus or in any free writing prospectus
          prepared by us or on our behalf to which we may have referred you in
          connection with this offering. Neither we nor the underwriters take
          responsibility for, or can provide assurance as to the reliability of,
          any other information that others may give you. We are offering to
          sell, and seeking offers to buy, shares of our common stock only in
          jurisdictions where offers and sales are permitted. The information
          contained in this prospectus is accurate only as of the date of this
          prospectus, regardless of the time of delivery of this prospectus or
          of any sale of our common stock.
       
          For investors outside the United States: Neither we nor any of the
          underwriters have done anything that would permit this offering or
          possession or distribution of this prospectus in any jurisdiction
          where action for that purpose is required, other than in the United
          States. Persons outside of the United States who come into possession
          of this prospectus must inform themselves about, and observe any
          restrictions relating to, the offering of the shares of our common
          stock and the distribution of this prospectus outside of the United
          States.
       
          Through and including                 , 2021 (the 25th day after the
          date of this prospectus), all dealers effecting transactions in these
          securities, whether or not participating in this offering, may be
          required to deliver a prospectus. This is in addition to a dealer’s
          obligation to deliver a prospectus when acting as an underwriter and
          with respect to an unsold allotment or subscription.
       
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          A LETTER FROM YANCEY SPRUILL, OUR CHIEF EXECUTIVE OFFICER
       
          Introduction
       
          Thank you for your interest in DigitalOcean and for considering an
          investment in our company. I wanted to share a few thoughts with you
          to provide a little more color on our company.
       
          Our Start and Mission
       
          Nine years ago, our founders had a vision that the cloud was the new
          way to build modern day web applications. They firmly believed that
          software developers, entrepreneurs and small and medium-sized
          businesses (SMBs) were being poorly served by the emerging cloud
          computing providers. As a result, millions and millions of innovators
          were not able to take full advantage of the many opportunities
          becoming available through innovative cloud infrastructure
          technologies.
       
          DigitalOcean was founded with a focus on creating simple solutions
          that developers love. Our mission is to simplify cloud computing so
          developers and businesses can spend more time creating software that
          changes the world. We estimate there are approximately 100 million
          SMBs globally today and 14 million new businesses started each year
          across the globe. We believe DigitalOcean is the perfect place for
          them to start, get lift-off and build their businesses.
       
          When start-ups and SMBs are building their applications or businesses,
          they need to maximize their energies on developing great products and
          building customer relationships. When they buy technology tools, they
          want them to be easy to use and they want help and support when they
          have issues deploying those tools.
       
          DigitalOcean is purpose-built to enable developers, entrepreneurs,
          start-ups and SMBs in a way that wasn’t possible a decade ago. Our
          offerings provide on-demand infrastructure and platform tools for
          developers, start-ups and SMBs that are easy to leverage, broadly
          accessible, reliable and affordable.
       
          We provide a range of capabilities to access our compute, network and
          storage infrastructure, as well as software-managed services that
          provide additional capabilities for managing more robust
          infrastructure needs - from testing code to building their customer
          serving applications.
       
          We have removed the barriers to entry for early-stage businesses,
          helping them turn their ideas into an application, website or tool
          that is available globally in a matter of minutes - and, importantly,
          at a manageable and transparent price point.
       
          Our founders started with four key principles that endure today. These
          four principles allow us to provide a highly differentiated experience
          for our customers all over the world:
       
          1.
       
          Simplicity - We take infrastructure technology and make it simple
          across all aspects of the product experience.
       
          2.
       
          Customer Support - We provide live support to all customers,
          regardless of price point, and we provide free access on our site to
          tens of thousands of helpful documents.
       
          3.
       
          Community - We invest heavily in the community of developers and
          entrepreneurs by helping them in the early stages of idea generation,
          and by providing various resources to guide them in successfully
          pursuing their ventures.
       
          4.
       
          Open Source Software - Through open source software we enable faster,
          lower-cost innovation without locking customers into a proprietary
          software technology stack.
       
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          It has been only nine years since DigitalOcean was founded and we are
          incredibly proud of what we have already accomplished. We now serve
          more than 570,000 customers in over 185 countries. We’ve built a
          secure, efficient, reliable and global-scale infrastructure with a
          growing set of managed software services to support our customers.
          We’ve established ourselves as a top developer learning community with
          over 34,000 developer tutorials, technical guides and
          community-generated Q&As. We have also crossed $357 million in ARR and
          achieved 30% Adjusted EBITDA margin in 2020.
       
          And we’re just getting started...
       
          Our Strategy
       
          Our strategy is focused on three key imperatives - Grow faster, Grow
          smarter and Grow together.
       
          To Grow faster, we are focusing on optimizing our go-to-market
          execution - from how we attract customers to how we expand our
          customer relationships to what we offer our customers. We are
          committed to innovation in the products and services we offer and will
          always be laser-focused on serving our core customer set. We have a
          massive customer and revenue opportunity in front of us and this
          go-to-market innovation will drive our growth and long-term success.
       
          To Grow smarter, we are focusing our team on building efficiency as we
          scale. We will continue to improve our customers’ experience on our
          platform, which will include building more robustness, security,
          reliability and scalability to allow them to grow with us. We will do
          so while also building operating efficiencies as we invest, so that we
          can improve operating margins and cash generation over time.
          Profitability is a choice, and we choose to self-fund our future. This
          provides our customers with the comfort to put their trust in us and
          to know we will be here to support their growth and aspirations over
          the long term. This also provides our investors with confidence that
          we will prioritize our investments on the highest growth and
          return-generating activities to create sustainable equity value.
       
          To Grow together, we invest in everyone at DigitalOcean. Even as our
          business scales, it will continue to be an incredible place to work
          and to grow personally and professionally. We want this to be a
          memorable and defining experience for each of us in the broader arc of
          our careers. We want to support everyone across our company, so each
          of us is ready to perform at our best as we march together and build
          an enduring company that serves significantly more customers, is
          significantly larger in terms of revenue and is also more profitable.
       
          We look forward to providing regular updates against these key
          imperatives as we make progress over time.
       
          Our Values
       
          Our values help us frame who we are. We strive to live them every day,
          in every decision and with every interaction. They are the fabric that
          binds us together and inspires us, and they are a powerful statement
          that it’s not just “what we do” but also “how we do it.”
       
          •
       
          Our community is bigger than just us
       
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          •
       
          Simplicity in all we DO
       
          •
       
          We speak up when we have something to say and listen when others DO
       
          •
       
          We are accountable to deliver on our commitments
       
          •
       
          Love is at our core
       
          The global community of software developers and entrepreneurs have
          been the foundation and inspiration for everything we do. Simplicity
          is a core value to us because it is a reminder to keep our customers
          top of mind in everything we do. Doing so enables us to keep our
          solutions tailored to them and allows them to focus on building their
          applications.
       
          We speak up when we have something to say and listen when others DO is
          about our transparency and inclusivity. We want DigitalOcean to be a
          place where you know where we stand and no matter your background or
          experiences, you can find your voice and your place here. Our
          customers, employees and investors place enormous trust in us, and we
          have to be accountable to deliver to all of you. Last, but certainly
          not least, love is at our core. The love for our customers and for
          what we do in our jobs makes DigitalOcean a special place – you hear
          it in the voices of our customers and our employees every time they
          talk about DigitalOcean.
       
          Our Hub for Good Initiative
       
          In the spring of 2020, we launched Hub for Good as a way to donate a
          portion of our infrastructure to organizations looking to make a
          difference in serving their communities during this extraordinary
          time. This program was originally designed to support COVID-19 relief
          efforts, but we have now expanded the scope and resources of this
          program to support efforts to make the world a better place beyond
          alleviating the strains of the pandemic. Since launch, we have
          sponsored over 1,000 projects, including apps created to enable
          musicians to collaborate remotely, to provide a way for local citizens
          to contribute to restaurants and their workers, to translate the
          torrent of information being put out on TV and news into a language
          the hearing impaired can understand, to identify local residents in
          need and match them to volunteers to get them the food and medicine
          they need, and so many more.
       
          Upon completion of our IPO, we are looking to further expand our
          investment in Hub for Good to promote the entrepreneurial and
          developer communities’ use of cloud computing to innovate and make our
          world a better place. We are joining the Pledge 1% movement and will
          be allocating a dollar amount equal to 1% of our equity valuation at
          the pricing of our IPO to expand our Hub for Good program over the
          next 10 years. We’re proud to expand Hub for Good, and we are excited
          that our technology can be a force for good across our world and to
          demonstrate that the community is bigger than just us.
       
          In Closing
       
          We would be honored to have you join us as an investor on our post-IPO
          journey. We believe we have an incredible opportunity to serve
          aspiring software developers and entrepreneurs throughout the world as
          they test their ideas, build their businesses and realize their
          dreams.
       
          LOGO
       
          Yancey Spruill
       
          Chief Executive Officer
       
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          PROSPECTUS SUMMARY
       
          This summary highlights selected information contained elsewhere in
          this prospectus. This summary does not contain all of the information
          you should consider before investing in our common stock. You should
          read this entire prospectus carefully, including the sections titled
          “Risk Factors,” “Management’s Discussion and Analysis of Financial
          Condition and Results of Operations” and our consolidated financial
          statements and the related notes included elsewhere in this
          prospectus, before making an investment decision. Unless the context
          otherwise requires, all references in this prospectus to
          “DigitalOcean,” the “company,” “we,” “our,” “us” or similar terms
          refer to DigitalOcean Holdings, Inc. and its consolidated
          subsidiaries.
       
          Overview
       
          Our mission is to simplify cloud computing so that developers and
          businesses can spend more time building software that changes the
          world.
       
          DigitalOcean is a leading cloud computing platform offering on-demand
          infrastructure and platform tools for developers, start-ups and small
          and medium-sized businesses, or SMBs. We were founded with the guiding
          principle that the transformative benefits of the cloud should be easy
          to leverage, broadly accessible, reliable and affordable. Our platform
          simplifies cloud computing, enabling our customers to rapidly
          accelerate innovation and increase their productivity and agility.
          Over 570,000 individual and business customers currently use our
          platform to build, deploy and scale software applications. Our users
          include software engineers, researchers, data scientists, system
          administrators, students and hobbyists. Our customers use our platform
          across numerous industry verticals and for a wide range of use cases,
          such as web and mobile applications, website hosting, e-commerce,
          media and gaming, personal web projects, and managed services, among
          many others. We believe that our focus on simplicity, community, open
          source and customer support are the four key differentiators of our
          business, driving a broad range of customers around the world to build
          their applications on our platform.
       
          Cloud computing is revolutionizing how companies across the globe
          develop and deploy applications. The cloud offers lower upfront cost
          and superior flexibility, extensibility and scalability as compared to
          on-premise software development environments. These benefits are
          especially valuable for start-ups and SMBs, as they typically have
          more limited financial resources, operational expertise and IT
          personnel. As software and cloud-based technologies have become
          essential across industries and businesses of all sizes, the number of
          software developers and their strategic importance to organizations
          are both increasing significantly. According to SlashData, the number
          of developers globally was 19 million in 2019 and is expected to grow
          to 45 million by 2030.
       
          Improving the developer experience and increasing developer
          productivity are core to our mission. Our developer cloud platform was
          designed with simplicity in mind to ensure that software developers
          can spend less time managing their infrastructure and more time
          turning their ideas into innovative applications to grow their
          businesses. Simplicity guides how we design and enhance our
          easy-to-use-interface, the core capabilities we offer our customers
          and our approach to predictable and transparent pricing for our
          solutions. We offer mission-critical infrastructure solutions across
          compute, storage and networking, and we also enable developers to
          extend the native capabilities of our cloud with fully managed
          application, container and database offerings. In just minutes,
          developers can set up thousands of virtual machines, secure their
          projects, enable performance monitoring and scale up and down as
          needed. Our pricing is consumption-based and billed monthly in
          arrears, making it easy for our customers to track usage on an ongoing
          basis and optimize their deployments.
       
          The global developer and open source communities are fundamental to
          our business, and a key source of ideas and innovations that support
          our sustained growth. Our developer-centric approach has helped us
          foster a
       
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          large and loyal following. We attract approximately 5 million monthly
          unique visitors to our websites, host what we believe is the largest
          hackathon in the world, and offer a comprehensive library of
          high-quality technical tutorials and community-generated questions and
          answers. Developers and SMBs especially value open source technology
          as it allows them greater choice, affordability and flexibility, and
          our platform is designed to take advantage of open source technology
          to provide our customers with a much more efficient way to work. Our
          participation in and support of the open source community further
          enhance the attractiveness, depth and scalability of our offering.
       
          Our customers depend on us for their critical business needs, and we
          are passionate about providing superior 24x7 customer support to all
          of our customers, regardless of size. We believe our customer support,
          coupled with our easy-to-use self-help resources and active developer
          community, has created tremendous brand loyalty amongst our growing
          customer base. Our customers become great advocates for DigitalOcean
          and are a common source of new customer referrals. We are proud of our
          Net Promoter Score, or NPS, which averaged 65 during 2020, comparable
          to some of the world’s most beloved brands.
       
          We have a highly efficient self-service customer acquisition model,
          which we have recently complemented with a targeted inside sales
          force. Our sales and marketing expense as a percentage of revenue was
          approximately 14%, 12% and 11% in 2018, 2019 and 2020, respectively.
          The efficiency of our go-to-market model and our focus on the needs of
          the individual and SMB market have helped us build a global customer
          base that continues to grow. We had approximately 573,000 customers as
          of December 31, 2020, up from approximately 502,000 as of December 31,
          2018. Our customers are spread across over 185 countries, and around
          two-thirds of our revenue has historically come from customers located
          outside the United States. We have a growing number of customers with
          higher spending levels, and our existing customers are continuing to
          expand their business with us. Our average revenue per customer (which
          we refer to as ARPU) has increased significantly, from $35.97 in 2018
          to $40.16 in 2019 to $47.78 in 2020. See the section titled
          “Management’s Discussion and Analysis of Financial Condition and
          Results of Operations—Key Business Metrics” for additional
          information.
       
          We have experienced strong revenue growth and improving margins in
          recent periods. For the years ended December 31, 2018, 2019 and 2020,
          our revenue was $203.1 million, $254.8 million and $318.4 million,
          respectively, representing year-over-year growth of 25% in 2019 and
          2020. Our net loss attributable to common stockholders was
          $36.0 million, $40.4 million and $43.6 million for the years ended
          December 31, 2018, 2019 and 2020, respectively. Our adjusted EBITDA
          was $39.5 million, $55.2 million and $95.9 million for the years ended
          December 31, 2018, 2019 and 2020, respectively. Our net cash provided
          by operating activities was $38.0 million, $39.9 million and
          $58.1 million for the years ended December 31, 2018, 2019 and 2020,
          respectively. See the section titled “Selected Consolidated Financial
          Data—Non-GAAP Financial Measures” for additional information regarding
          adjusted EBITDA, the limitations of this non-GAAP financial measure
          and a reconciliation of this measure to the most directly comparable
          financial measure stated in accordance with GAAP.
       
          Industry Background
       
          There are a number of key technology and industry trends driving our
          opportunity, including:
       
          •
       
          The Growing Need for Technological Innovation is Driving Cloud
          Computing Adoption. Technology is transforming how businesses of all
          sizes engage with customers, manage their operations and drive
          competitive advantages. The global phenomenon of technology-powered
          growth and innovation requires nearly every company to focus their
          efforts on harnessing the power of technology through cloud services.
          Cloud computing has become the new standard for IT infrastructure as
          organizations seek to benefit from the flexibility, scalability and
          reliability of the cloud. Cloud technologies enable businesses to
          better focus their efforts on customer applications rather than the
          physical infrastructure required to support their
       
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          operations. Start-ups and SMBs are particularly focused on leveraging
          the cloud for capabilities that would otherwise be inaccessible due to
          the high cost and expertise needed to deploy these capabilities
          on-premise.
       
          •
       
          Proliferation of Cloud Native Start-Ups and SMBs. There are more than
          32 million SMBs in the United States alone, according to the World
          Bank, and we estimate there are at least three times that number, or
          100 million SMBs, globally. We expect this number will continue to
          grow, with more than 14 million net new SMBs created globally each
          year. In addition, the founding teams of these SMBs are no longer
          comprised only of technical individuals with advanced software
          development capabilities, but now include a far wider range of
          individuals. These individuals are able to leverage simple and
          reliable development tools and the widespread availability and
          significantly lower upfront cost of cloud computing to start
          companies. As such, a significant proportion of start-ups and SMBs are
          being built in the cloud to benefit from the faster, cheaper and
          easier way to deploy and manage their business solutions.
       
          •
       
          Software Developers Are Increasingly Influential Within Organizations.
          Companies increasingly rely on developers to quickly adapt to changing
          technological and business trends in order to compete. This trend has
          contributed to the shift to the cloud as cloud-based technologies
          increase the efficiency and flexibility of those developers. Developer
          productivity has become a top priority for companies around the world
          as they recognize the significant benefits derived from providing
          developers with the most powerful tools available. As a result, the
          global developer population, which according to SlashData will reach
          45 million by 2030, has become increasingly influential on
          technology-related investment decisions.
       
          •
       
          Open Source Software Is Accelerating Innovation. Open source
          technologies are powering many of the world’s most innovative
          start-ups and SMBs. This trend is expansive and being driven primarily
          by developers who are increasingly empowered to use the most efficient
          tools to accelerate the pace of innovation. Open source software
          enables individuals and businesses to access and use low cost, proven
          software tools for their applications instead of investing the time
          and resources in recreating the same use cases in self-developed
          software. Businesses of all sizes benefit from the many advantages of
          open source including, lower costs, increased speed to market,
          application reliability and flexibility and improved security.
       
          •
       
          Organizations are Increasingly Using Multiple Clouds. Multi-cloud
          deployments have become increasingly common as individuals and
          businesses seek to match their applications with the best technology
          stacks and commercial models to run them while avoiding vendor lock-in
          akin to legacy IT infrastructure services. The future growth of the
          cloud-computing market across the globe will benefit significantly
          from this expanding trend of multi-cloud adoption.
       
          Limitations of Existing Offerings on Developers, Start-Ups and SMBs
       
          Existing offerings from large public cloud vendors are designed for
          complex, enterprise use cases such as migrating legacy workloads from
          on-premise to the cloud. The products and services offered by these
          vendors are not tailored for the needs of individual developers,
          start-ups or SMBs. The limitations of these enterprise-focused
          offerings include the following:
       
          •
       
          Difficult to Use. Enterprise-focused vendors frequently have
          complicated implementation processes, which require a significant
          amount of time to learn complex user interfaces and features rather
          than allowing developers to focus on building and deploying
          applications. These unintuitive or inconveniently packaged services
          have limited the ability of start-ups and SMBs, who typically do not
          have IT departments or large teams, to maximize the value of their
          cloud investments due to the amount of time and resources required to
          train on and manage underlying infrastructure.
       
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          •
       
          Uncurated Set of Offerings. Traditional public cloud vendors have
          built their platforms to serve global enterprises with large
          development teams. The thousands of ancillary products and services
          that are offered by these vendors create a significant amount of
          complexity that is difficult for developers, start-ups, and SMBs to
          manage.
       
          •
       
          Complex and Opaque Pricing. Existing cloud providers often have
          intricate and unpredictable pricing and billing practices. The lack of
          pricing transparency frequently leads to surprise charges and higher
          than expected costs, making budgeting and cost optimization very
          difficult. Companies frequently need dedicated employees, pricing
          analytics tools or even specialized consultants to understand how
          products are priced and how to manage their bills.
       
          •
       
          Lack of Customer Support. As traditional public cloud vendors target
          large enterprise customers, smaller buyers often do not get the
          necessary level of support required to manage their infrastructure.
          These smaller buyers, including start-ups and SMBs, are often those
          most in need of and reliant on support to help them manage their
          infrastructure effectively and efficiently.
       
          Our Solution
       
          DigitalOcean was founded with the guiding principle that the
          transformative benefits of the cloud should be easy to leverage,
          broadly accessible, reliable and affordable. We pioneered the
          developer cloud platform to simplify cloud computing, enabling
          developers and developer teams to quickly deploy and scale
          applications, collaborate efficiently and improve business
          performance. Empowered by an easy-to-use self-service model, intuitive
          control panel and highly predictable pricing, our customers are able
          to rapidly accelerate innovation and increase their productivity and
          agility.
       
          •
       
          Simple and Intuitive. Our platform is engineered to take a user from
          inquiry to deployment within minutes, without any specialized training
          or heavy implementation. We abstract away the complexity that is
          generally found across legacy cloud providers to provide a compelling,
          intuitive interface with click-and-go options. Our platform provides
          users with a deployment interface that is comparable to interfaces
          provided by consumer internet leaders and is designed to minimize the
          number of steps to deployment.
       
          •
       
          Designed by Developers for Developers. Our platform was built with a
          developer-first mentality and is designed for a wide range of use
          cases, such as web and mobile applications, website hosting,
          e-commerce, media and gaming, personal web projects, and managed
          services, among many others. Our innovative cloud platform is designed
          to eliminate the complexity and obstacles associated with deploying in
          and managing the cloud.
       
          •
       
          Built to Help Businesses Scale. Our highly-curated set of solutions,
          including compute, storage and networking offerings, managed databases
          and developer and management tools, are all designed to address the
          needs of start-ups and SMBs as they scale their businesses and require
          more cloud capabilities.
       
          •
       
          Open Source. Our participation in and support of the open source
          software community enhances the attractiveness, depth and scalability
          of our offering. It increases the transparency of our technology and
          allows our customers to more efficiently write their own integrations.
          We give back to the community by sponsoring projects to create content
          and tools that help developers build great software and hosting events
          that are focused on driving the growth of open source, such as our
          Hacktoberfest, which we believe is the largest hackathon in the world.
       
          •
       
          Differentiated Customer Support. We offer expert 24x7 technical
          support and customer service, with support staff spanning various time
          zones to ensure our customers quickly achieve their objectives and
       
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          overcome challenges. Developers and engineers are a key part of our
          customer support team, and our technical support is—and always has
          been—available free of charge to all customers. Customers cite our
          attentive support as a key driver of their decision to start and grow
          their businesses on our platform.
       
          •
       
          Broad-Based Community Ecosystem: We have built one of the world’s
          largest developer learning communities, with approximately 6,000
          high-quality developer tutorials and over 28,000 community-generated
          questions & answers. The strength and continued growth of our
          community ecosystem, which is managed by our internal developer
          relations and editorial teams, is predicated on differentiated content
          on our community education website, which attracts approximately
          3.5 million monthly unique visitors.
       
          •
       
          Transparent and Predictable Pricing. Our approach to billing and
          pricing is simple, intuitive and transparent. Our pricing is
          consumption-based and renewable monthly, making it easy for our
          customers to optimize their deployments. We provide detailed monthly
          invoices, irrespective of the customer’s size or number of products
          purchased, making it easy to track usage on an ongoing basis. We
          enable our customers to completely control their spending and ensure
          there are no hidden charges that appear at the end of the month.
       
          •
       
          Security and Data Protection. We invest significantly in securing the
          computing infrastructure foundation upon which our customers build and
          scale their projects. We remove the complexity of securing
          infrastructure for our customers and make it simple for them to build
          the security layers required for their use cases. We are also
          committed to customer data privacy and utilize best-in-class access,
          encryption and data protection technologies and processes.
       
          •
       
          Built for Collaboration. Our platform enables secure and efficient
          collaboration across developer teams to manage and scale
          infrastructure and applications. We support thousands of developer
          teams on our platform and provide them with easy-to-use tools to
          better manage their workflows.
       
          Key Benefits to Our Customers
       
          Our solution is designed to empower our target customers with
          best-in-class cloud technologies, while supporting them with superior
          customer service. This customer-centric focus underpins our mission of
          simplifying cloud computing so developers and businesses can spend
          more time building software that changes the world. Our NPS averaged
          65 during 2020, which is comparable to some of the world’s most
          beloved brands. For our customers, the key benefits of our solution
          include:
       
          •
       
          Accelerating innovation by leveraging the full power of the cloud
       
          •
       
          Making it simple to build, deploy and scale applications
       
          •
       
          Achieving rapid time-to-value with a reliable, highly-performant and
          cost-effective platform
       
          •
       
          Spending less time managing infrastructure and more time on higher
          value tasks that drive the growth and success of their businesses
       
          •
       
          Superior customer support that is free to all customers
       
          •
       
          A highly-reliable, scalable and secure platform
       
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          We have a highly diverse customer base that uses our platform for a
          variety of projects and applications. Recent customer success stories
          include:
       
          •
       
          RouteTrust, a telecommunications start-up, launched a
          Platform-as-a-Service (PaaS) offering that processes billions of voice
          calls each month using our Droplets and our Managed Kubernetes
          service.
       
          •
       
          Cloudways, a managed hosting company in Malta, provides web hosting
          services to over 250,000 websites using our Droplets.
       
          •
       
          Rockerbox, an advertising and analytics company, dramatically reduced
          their cloud costs by 80% by efficiently running their data collection
          and analysis using our Droplets and our Managed Kubernetes, Managed
          Databases, Load Balancers and Spaces services.
       
          •
       
          Jiji, an online marketplace platform in Nigeria, serves over 200
          million buyers and sellers across five countries in Africa.
       
          •
       
          Parabol, a remote meeting platform for teams embracing agile
          practices, makes it easier to host planning sessions, scrums and
          meetings online using our Droplets and our Managed Database service.
       
          •
       
          Centra, a Software-as-a-Service (SaaS)-based e-commerce platform in
          Sweden, provides a powerful backend offering that allows brands to
          build custom-designed, online flagship stores.
       
          •
       
          An entrepreneur in the United Kingdom utilizes our Managed Kubernetes
          service and open source software to profitably scale his API-centric
          product helping online media companies automate their quality
          assurance testing.
       
          Our Market Opportunity
       
          The Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service
          (PaaS) markets are two of the largest and fastest growing markets
          across all industries. According to IDC, the worldwide IaaS and PaaS
          markets for individuals and companies with less than 500 employees are
          estimated to be approximately $44.4 billion in the aggregate in 2020.
          The 2020 IaaS market, which is comprised of compute and storage, was
          estimated to be $31.9 billion. The 2020 PaaS market, which includes
          database management systems, application platforms and other platform
          services, was estimated to be $12.5 billion. According to IDC, these
          combined IaaS and PaaS markets are expected to grow to $115.5 billion
          in 2024, representing a 27% compound annual growth rate.
       
          We believe the individual developer, start-up and SMB markets are
          underserved, and we expect our massive addressable market to continue
          to grow rapidly beyond 2024. The key drivers of this growth come from
          the increasing technological innovation which drives cloud adoption
          combined with the growing number of developers and SMBs worldwide.
          According to SlashData, the global developer population is expected to
          more than double over the next 10 years to approximately 45 million by
          2030. Furthermore, there are more than 32 million SMBs in the United
          States alone, according to the World Bank, and we estimate that there
          are at least three times that number, or 100 million SMBs, globally.
          We expect this number will continue to grow, with more than 14 million
          net new SMBs created globally each year.
       
          Our Growth Strategies
       
          We are driving significant growth by executing on the following key
          strategies:
       
          •
       
          Growing Our Customer Base. We believe there is a substantial
          opportunity to further expand our customer base. We have historically
          attracted customers by offering a low-friction, self-service cloud
          platform combined with a highly-efficient self-service marketing
          model.
       
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          •
       
          Increasing Usage by Our Existing Customers. Our customer base of more
          than 570,000 customers represents a significant opportunity for
          further sales expansion through increased usage of our platform and
          adoption of additional product offerings.
       
          •
       
          Investing in Our Platform and Product Offerings. We have a history of,
          and will continue to invest significantly in, delivering innovative
          products, features and functionality targeted at our core customer
          base. We have successfully attracted new customers to our platform and
          driven expansion with existing customers through new product launches,
          such as our Managed Kubernetes offering in late 2018, our Managed
          Database offering in 2019 and our App Platform service in October
          2020.
       
          •
       
          Augmenting Our Platform through Opportunistic Strategic Acquisitions.
          We believe that strategic partnerships and acquisitions will allow us
          to accelerate our key platform, product and marketing initiatives. For
          example, our App Platform service originated from an acquisition and
          we have expanded our community tutorial content through two small
          acquisitions, and we believe that additional acquisition opportunities
          will supplement our organic growth strategy.
       
          •
       
          Growing and Engaging Our Community. More than 5 million unique
          visitors interact with our websites, including our developer
          community, each month to learn, share and educate others. We are
          committed to supporting and expanding this community of innovators and
          technologists through high-quality content and expanded
          developer-focused programs and events around the world.
       
          Risk Factors Summary
       
          Investing in our common stock involves a high degree of risk. The
          risks and uncertainties described in the section titled “Risk Factors”
          immediately following this summary may cause us to not realize the
          full benefits of our strengths or may cause us to be unable to
          successfully execute all or part of our strategy. These risks and
          uncertainties include, among others:
       
          •
       
          Our recent growth may not be indicative of our future growth.
       
          •
       
          We have a history of operating losses and may not achieve or sustain
          profitability in the future.
       
          •
       
          We expect fluctuations in our financial results, making it difficult
          to project future results, and if we fail to meet the expectations of
          securities analysts or investors with respect to our results of
          operations, our stock price and the value of your investment could
          decline.
       
          •
       
          If we are unable to attract new customers, including through our
          self-service customer acquisition model, retain existing customers
          and/or expand usage of our platform by such customers, we may not
          achieve the growth we expect, which would adversely affect our results
          of operations and financial condition.
       
          •
       
          If we or our third-party service providers experience a security
          breach or unauthorized parties otherwise obtain access to our platform
          or our customers’ data, we may incur significant liabilities and our
          reputation and business may be harmed.
       
          •
       
          If we fail to timely release updates and new features to our platform
          and adapt and respond effectively to rapidly changing technology,
          evolving industry standards, changing regulations, or customer needs,
          our platform and products may become less competitive.
       
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          •
       
          The markets in which we participate are competitive, and if we do not
          compete effectively, our business, financial condition and results of
          operations could be harmed.
       
          •
       
          Our current operations are international in scope, and we plan further
          geographic expansion, creating a variety of operational challenges.
       
          •
       
          Activities of our customers or the content on their websites could
          subject us to liability.
       
          •
       
          The success of our business depends on our customers’ continued and
          unimpeded access to our platform on the internet and, as a result,
          also depends on internet providers and the related regulatory
          environment.
       
          Corporate Information
       
          We were incorporated in Delaware in 2012 under the name Digital
          Ocean, Inc. In 2016, as part of a restructuring, Digital Ocean, Inc.
          was converted into DigitalOcean, LLC, and DigitalOcean Holdings, Inc.
          was formed as the ultimate parent holding company. Our primary
          operations are performed globally through our wholly owned operating
          subsidiaries. Our principal executive offices are located at 101
          6th Avenue, New York, New York 10013, and our telephone number is
          (646) 827-4366. Our website address is www.digitalocean.com.
          Information contained on, or that can be accessed through, our website
          is not incorporated by reference into this prospectus, and you should
          not consider information on our website to be part of this prospectus.
       
          “DigitalOcean®”, “Droplet®” and our other registered and common law
          trade names, trademarks and service marks are the property of
          DigitalOcean. Other trade names, trademarks and service marks used in
          this prospectus are the property of their respective owners. Solely
          for convenience, the trademarks and trade names in this prospectus may
          be referred to without the ® and ™ symbols, but such references should
          not be construed as any indicator that their respective owners will
          not assert their rights thereto.
       
          Implications of Being an Emerging Growth Company
       
          We are an “emerging growth company” as defined in the Jumpstart Our
          Business Startups Act of 2012, or the JOBS Act. We may take advantage
          of certain exemptions from various public company reporting
          requirements, including not being required to have our internal
          controls over financial reporting audited by our independent
          registered public accounting firm under Section 404 of the
          Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced
          disclosure obligations regarding executive compensation in our
          periodic reports and proxy statements and exemptions from the
          requirements of holding a non-binding advisory vote on executive
          compensation and any golden parachute payments. We may take advantage
          of these exemptions for up to five years or until we are no longer an
          emerging growth company, whichever is earlier. In addition, the JOBS
          Act provides that an “emerging growth company” can delay adopting new
          or revised accounting standards until those standards apply to private
          companies. We have elected to take advantage of certain of the reduced
          disclosure obligations in the registration statement of which this
          prospectus is a part and may elect to take advantage of other reduced
          reporting requirements in future filings. As a result, the information
          that we provide to our stockholders may be different than you might
          receive from other public reporting companies in which you hold equity
          interests.
       
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          THE OFFERING
       
          Common stock offered by us
       
                      shares
       
          Common stock to be outstanding after this offering
       
                      shares
       
          Option to purchase additional shares of common stock offered by us
       
                      shares
       
          Use of proceeds
       
          We estimate that our net proceeds from the sale of our common stock
          that we are offering will be approximately $         million (or
          approximately $         million if the underwriters’ option to
          purchase additional shares of our common stock from us is exercised in
          full), assuming an initial public offering price of $         per
          share, the midpoint of the estimated price range set forth on the
          cover page of this prospectus, and after deducting the underwriting
          discounts and commissions and estimated offering expenses payable by
          us.
       
          The principal purposes of this offering are to create a public market
          for our common stock, facilitate our future access to the capital
          markets and increase our capitalization and financial flexibility. As
          of the date of this prospectus, we cannot specify with certainty all
          of the particular uses for the net proceeds to us from this offering.
          However, we currently intend to use the net proceeds we receive from
          this offering for general corporate purposes, including working
          capital, operating expenses and capital expenditures. We may also use
          a portion of the net proceeds to acquire complementary businesses,
          services or technologies. However, we do not have agreements or
          commitments to enter into any acquisitions at this time. See the
          section titled “Use of Proceeds” for additional information.
       
          Risk factors
       
          You should carefully read the “Risk Factors” beginning on page 13 and
          other information included in this prospectus for a discussion of
          facts that you should consider before deciding to invest in shares of
          our common stock.
       
          Proposed trading symbol
       
          “DOCN”
       
          The number of shares of common stock that will be outstanding after
          this offering is based on 88,803,340 shares of common stock
          outstanding as of December 31, 2020, and excludes:
       
          •
       
          16,933,494 shares of common stock issuable upon the exercise of stock
          options outstanding as of December 31, 2020 under the 2013 Stock Plan,
          or 2013 Plan, with a weighted-average exercise price of approximately
          $6.73 per share;
       
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          •
       
          413,750 shares of common stock subject to restricted stock units, or
          RSUs, outstanding as of December 31, 2020 under the 2013 Plan;
       
          •
       
          308,632 shares of common stock issuable upon the exercise of warrants
          outstanding as of December 31, 2020 with a weighted-average exercise
          price of approximately $1.94 per share;
       
          •
       
          1,654,338 shares of common stock subject to RSUs granted after
          December 31, 2020 under the 2013 Plan;
       
          •
       
                          shares of common stock reserved for future issuance
          under our 2021 Equity Incentive Plan, or the 2021 Plan, as well as any
          future increases in the number of shares of common stock reserved for
          issuance under our 2021 Plan; and
       
          •
       
                          shares of common stock reserved for issuance under our
          2021 Employee Stock Purchase Plan, or the ESPP, as well as any future
          increases in the number of shares of common stock reserved for future
          issuance under our ESPP.
       
          In addition, unless we specifically state otherwise, the information
          in this prospectus assumes:
       
          •
       
          the filing and effectiveness of our amended and restated certificate
          of incorporation in connection with the completion of this offering;
       
          •
       
          the automatic conversion of all of our outstanding shares of preferred
          stock into an aggregate of 45,472,229 shares of common stock in
          connection with the completion of this offering;
       
          •
       
          the automatic conversion of warrants to purchase 308,632 shares of
          Series A-1 preferred stock into warrants to purchase the same number
          of shares of common stock in connection with the completion of this
          offering;
       
          •
       
          no exercise of outstanding options or warrants, or the settlement of
          outstanding RSUs, subsequent to December 31, 2020; and
       
          •
       
          no exercise of the underwriters’ option to purchase additional shares
          of common stock from us in this offering.
       
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          SUMMARY CONSOLIDATED FINANCIAL DATA
       
          The summary consolidated statements of operations data for the years
          ended December 31, 2018, 2019 and 2020 and the summary consolidated
          balance sheet data as of December 31, 2020 have been derived from our
          audited consolidated financial statements included elsewhere in this
          prospectus.
       
          You should read the consolidated financial data set forth below in
          conjunction with our consolidated financial statements and the
          accompanying notes and the information in “Management’s Discussion and
          Analysis of Financial Condition and Results of Operations” contained
          elsewhere in this prospectus. Our historical results are not
          necessarily indicative of the results to be expected for the full year
          or any other period in the future.
       
          Year Ended December 31,
       
                  2018        
       
                  2019        
       
                  2020        
       
          (in thousands, except per share data)
       
          Consolidated Statements of Operations Data:
       
          Revenue
       
          $
       
          203,136
       
          $
       
          254,823
       
          $
       
          318,380
       
          Cost of revenue(1)
       
          97,042
       
          122,259
       
          145,532
       
          Gross profit
       
          106,094
       
          132,564
       
          172,848
       
          Operating expenses:
       
          Research and development(1)
       
          44,934
       
          59,973
       
          74,970
       
          Sales and marketing(1)
       
          29,445
       
          31,340
       
          33,472
       
          General and administrative(1)
       
          59,009
       
          71,156
       
          80,197
       
          Total operating expenses
       
          133,388
       
          162,469
       
          188,639
       
          Loss from operations
       
          (27,294
       
          ) 
       
          (29,905
       
          ) 
       
          (15,791
       
          ) 
       
          Other (income) expense
       
          7,484
       
          9,692
       
          26,866
       
          Loss before income taxes
       
          (34,778
       
          ) 
       
          (39,597
       
          ) 
       
          (42,657
       
          ) 
       
          Income tax expense
       
          1,221
       
          793
       
          911
       
          Net loss attributable to common stockholders
       
          $
       
          (35,999
       
          ) 
       
          $
       
          (40,390
       
          ) 
       
          $
       
          (43,568
       
          ) 
       
          Net loss per share attributable to common stockholders, basic and
          diluted(2)
       
          $
       
          (1.06
       
          ) 
       
          $
       
          (1.06
       
          ) 
       
          $
       
          (1.05
       
          ) 
       
          Weighted-average shares used to compute net loss per share, basic and
          diluted(2)
       
          33,971
       
          38,004
       
          41,658
       
          (1)
       
          Includes stock-based compensation as follows:
       
          Year Ended December 31,
       
                  2018        
       
                  2019        
       
                  2020        
       
          (in thousands)
       
          Cost of revenue
       
          $
       
           42
       
          $
       
          1,142
       
          $
       
          545
       
          Research and development
       
          2,559
       
          4,688
       
          7,765
       
          Sales and marketing
       
          381
       
          539
       
          1,924
       
          General and administrative
       
          9,185
       
          12,277
       
          19,222
       
          Total
       
          $
       
          12,167
       
          $
       
          18,646
       
          $
       
          29,456
       
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          Stock-based compensation for the years ended December 31, 2018, 2019
          and 2020 included compensation of $8.0 million, $12.1 million and
          $18.3 million, respectively, related to secondary sales of common
          stock by certain current and former employees, which is primarily
          included in General and administrative. See “Management’s Discussion
          and Analysis of Financial Condition and Results of
          Operations—Comparison of Years Ended December 31, 2019 and
          2020—Operating Expenses” and “—Comparison of Years Ended December 31,
          2018 and 2019—Operating Expenses.”
       
          (2)
       
          See Note 11 to our consolidated financial statements included
          elsewhere in this prospectus for an explanation of the calculations of
          our basic and diluted net loss per share attributable to common
          stockholders and the weighted-average number of shares used to compute
          the per share amounts.
       
          December 31, 2020
       
          Actual
       
          Pro Forma(1)
       
          Pro Forma
          As Adjusted(2)(3)
       
          (in thousands)
       
          Consolidated Balance Sheet Data:
       
          Cash and cash equivalents
       
          $
       
          100,311
       
          $
       
          $
       
          Total assets
       
          430,252
       
          Total liabilities
       
          329,272
       
          Convertible preferred stock
       
          173,074
       
          Total stockholders’ deficit
       
          $
       
          (72,094
       
          ) 
       
          (1)
       
          The pro forma consolidated balance sheet data gives effect to (a) the
          automatic conversion of all of our outstanding shares of convertible
          preferred stock into an aggregate of 45,472,229 shares of common stock
          in connection with the completion of this offering; and (b) the
          reclassification of the convertible preferred stock warrant liability
          to additional paid-in capital, as if such conversion, issuance and
          reclassification had occurred on December 31, 2020.
       
          (2)
       
          The pro forma as adjusted consolidated balance sheet data reflects
          (a) the items described in footnote (1) above; and (b) our receipt of
          estimated net proceeds from the sale of shares of common stock that we
          are offering at an assumed initial public offering price of
          $                per share, the midpoint of the estimated price range
          set forth on the cover page of this prospectus, after deducting the
          underwriting discounts and commissions and estimated offering expenses
          payable by us.
       
          (3)
       
          Each $1.00 increase (decrease) in the assumed initial public offering
          price of $                per share, the midpoint of the estimated
          price range set forth on the cover page of this prospectus, would
          increase (decrease) each of cash, total assets and total stockholders’
          deficit by $                million, assuming that the number of
          shares offered by us, as set forth on the cover page of this
          prospectus, remains the same, and after deducting the underwriting
          discounts and commissions and estimated offering expenses payable by
          us. Similarly, each increase (decrease) of 1,000,000 shares in the
          number of shares of common stock offered by us would increase
          (decrease) each of cash, total assets and total stockholders’ deficit
          by $                million, assuming the assumed initial public
          offering price of $                per share of common stock remains
          the same, and after deducting the underwriting discounts and
          commissions and estimated offering expenses payable by us.
       
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          RISK FACTORS
       
          Investing in our common stock involves a high degree of risk. You
          should consider and read carefully all of the risks and uncertainties
          described below, as well as other information included in this
          prospectus, including our consolidated financial statements and
          related notes appearing elsewhere in this prospectus, before making an
          investment decision. The risks described below are not the only ones
          we face. The occurrence of any of the following risks or additional
          risks and uncertainties not presently known to us or that we currently
          believe to be immaterial could materially and adversely affect our
          business, financial condition or results of operations. In such case,
          the trading price of our common stock could decline, and you may lose
          some or all of your original investment.
       
          Risk Factors Summary
       
          Investing in our common stock involves a high degree of risk because
          our business is subject to numerous risks and uncertainties, as more
          fully described below. These risks and uncertainties include, among
          others:
       
          •
       
          Our recent growth may not be indicative of our future growth.
       
          •
       
          We have a history of operating losses and may not achieve or sustain
          profitability in the future.
       
          •
       
          We expect fluctuations in our financial results, making it difficult
          to project future results, and if we fail to meet the expectations of
          securities analysts or investors with respect to our results of
          operations, our stock price and the value of your investment could
          decline.
       
          •
       
          If we are unable to attract new customers, including through our
          self-service customer acquisition model, retain existing customers
          and/or expand usage of our platform by such customers, we may not
          achieve the growth we expect, which would adversely affect our results
          of operations and financial condition.
       
          •
       
          If we or our third-party service providers experience a security
          breach or unauthorized parties otherwise obtain access to our platform
          or our customers’ data, we may incur significant liabilities and our
          reputation and business may be harmed.
       
          •
       
          If we fail to timely release updates and new features to our platform
          and adapt and respond effectively to rapidly changing technology,
          evolving industry standards, changing regulations, or customer needs,
          our platform and products may become less competitive.
       
          •
       
          The markets in which we participate are competitive, and if we do not
          compete effectively, our business, financial condition and results of
          operations could be harmed.
       
          •
       
          Our current operations are international in scope, and we plan further
          geographic expansion, creating a variety of operational challenges.
       
          •
       
          Activities of our customers or the content on their websites could
          subject us to liability.
       
          •
       
          The success of our business depends on our customers’ continued and
          unimpeded access to our platform on the internet and, as a result,
          also depends on internet providers and the related regulatory
          environment.
       
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          Risks Related to Our Business and Industry
       
          Our recent growth may not be indicative of our future growth.
       
          Our revenue was $203.1 million, $254.8 million and $318.4 million for
          the years ended December 31, 2018, 2019 and 2020, respectively. You
          should not rely on the revenue growth of any prior quarterly or annual
          period as an indication of our future performance. Even if our revenue
          continues to increase, our revenue growth rate may decline in the
          future as a result of a variety of factors, including the maturation
          of our business. Overall growth of our revenue depends on a number of
          factors, including our ability to:
       
          •
       
          attract new customers and grow our customer base;
       
          •
       
          maintain and increase the rates at which existing customers use our
          platform, sell additional products and services to our existing
          customers, and reduce customer churn;
       
          •
       
          invest in our platform and product offerings;
       
          •
       
          augment our platform through opportunistic strategic acquisitions; and
       
          •
       
          grow and engage our community.
       
          We may not successfully accomplish any of these objectives and, as a
          result, it is difficult for us to forecast our future results of
          operations. If the assumptions that we use to plan our business are
          incorrect or change in reaction to changes in our market, we may be
          unable to maintain consistent revenue or revenue growth, our stock
          price could be volatile, and it may be difficult to achieve and
          maintain profitability. You should not rely on our results or growth
          for any prior quarterly or annual periods as any indication of our
          future results or growth.
       
          We have a history of operating losses and may not achieve or sustain
          profitability in the future.
       
          We have incurred significant losses since inception. We generated net
          losses attributable to common stockholders of $36.0 million, $40.4
          million and $43.6 million for the years ended December 31, 2018, 2019
          and 2020, respectively. As of December 31, 2020, we had an accumulated
          deficit of $167.0 million. While we have experienced significant
          revenue growth in recent periods, we are not certain whether or when
          we will obtain a high enough volume of sales to sustain or increase
          our growth or achieve or maintain profitability in the future. We also
          expect our costs and expenses will increase in future periods, which
          could negatively affect our future results of operations if our
          revenue does not increase. Our efforts to grow our business may be
          costlier than we expect, or the rate of our growth in revenue may be
          slower than we expect, and we may not be able to increase our revenue
          enough to offset our increased operating expenses. We may incur
          significant losses in the future for a number of reasons, including
          the other risks described herein, and unforeseen expenses,
          difficulties, complications or delays, and other unknown events. If we
          are unable to achieve and sustain profitability, the value of our
          business and common stock may significantly decrease.
       
          In addition, we expect to continue to expend substantial financial and
          other resources on:
       
          •
       
          our technology infrastructure, including systems architecture,
          scalability, availability, performance, security, hardware, equipment
          and other capital expenditures, including expenses to increase or
          maintain data center capacity and to successfully optimize and operate
          data center facilities;
       
          •
       
          our sales and marketing organization to engage our existing and
          prospective customers, increase brand awareness and drive adoption of
          our products;
       
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          •
       
          product development, including investments in our product development
          team and the development of new products and new functionality for our
          platform as well as investments in both further optimizing our
          existing products and infrastructure and expanding our integrations
          and other add-ons to existing products and services;
       
          •
       
          acquisitions or strategic investments; and
       
          •
       
          general administration, including increased legal and accounting
          expenses associated with being a public company.
       
          Additionally, we may encounter unforeseen operating expenses,
          difficulties, complications, delays, and other unknown factors that
          may result in losses in future periods. If our revenue growth does not
          meet our expectations in future periods, our business, financial
          position and results of operations may be harmed, and we may not
          achieve or maintain profitability in the future.
       
          We have a limited operating history, which makes it difficult to
          forecast our future results of operations.
       
          We were founded in 2012 and, as a result of our limited operating
          history, our ability to accurately forecast our future results of
          operations is limited and subject to a number of uncertainties,
          including our ability to plan for and model future growth. Our
          historical revenue growth should not be considered indicative of our
          future performance. Further, in future periods, our revenue growth
          could slow or our revenue could decline for a number of reasons,
          including slowing demand for our products, increasing competition,
          changes to technology, a decrease in the growth of our overall market,
          our failure to attract more small and medium sized business customers,
          or our failure, for any reason, to continue to take advantage of
          growth opportunities. We have also encountered, and will continue to
          encounter, risks and uncertainties frequently experienced by growing
          companies in rapidly changing industries, including the other risks
          and uncertainties described herein. If our assumptions regarding these
          risks and uncertainties and our future revenue growth are incorrect or
          change, or if we do not address these risks successfully, our
          operating and financial results could differ materially from our
          expectations, and our business could suffer.
       
          We expect fluctuations in our financial results, making it difficult
          to project future results, and if we fail to meet the expectations of
          securities analysts or investors with respect to our results of
          operations, our stock price and the value of your investment could
          decline.
       
          Our results of operations have fluctuated in the past and are expected
          to fluctuate in the future due to a variety of factors, many of which
          are outside of our control. As a result, our past results may not be
          indicative of our future performance. In addition to the other risks
          described herein, factors that may affect our results of operations
          include the following:
       
          •
       
          fluctuations in demand for or pricing and usage of our platform and
          products;
       
          •
       
          our ability to attract new customers and retain existing customers;
       
          •
       
          customer expansion rates;
       
          •
       
          integration of new products;
       
          •
       
          timing and amount of our investments and capital expenditures related
          to successfully optimizing, utilizing and expanding our data center
          facilities;
       
          •
       
          the investment in and integration of new products and features
          relative to investments in our existing infrastructure and products;
       
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          •
       
          our ability to control costs, including our operating expenses, and
          the timing of payment for expenses;
       
          •
       
          the amount and timing of non-cash expenses, including stock-based
          compensation, goodwill impairments and other non-cash charges;
       
          •
       
          the amount and timing of costs associated with recruiting, training
          and integrating new employees and retaining and motivating existing
          employees;
       
          •
       
          the effects of acquisitions and their integration;
       
          •
       
          general economic conditions, both domestically and internationally,
          and economic conditions specifically affecting industries in which our
          customers participate, including those related to the recent COVID-19
          pandemic and responses thereto;
       
          •
       
          the impact of new accounting pronouncements;
       
          •
       
          changes in regulatory or legal environments that may cause us to,
          among other elements, be unable to continue operating in a particular
          market, remove certain customers from our platform, and/or incur
          expenses associated with compliance;
       
          •
       
          changes in the competitive dynamics of our market, including
          consolidation among competitors or customers or new entrants into our
          market;
       
          •
       
          our ability to control fraudulent registrations and usage of our
          platform, reduce bad debt and lessen capacity constraints on our data
          centers, servers and equipment; and
       
          •
       
          significant security breaches of, technical difficulties with, or
          interruptions to, the delivery and use of our products and platform
          capabilities.
       
          Any of these and other factors, or the cumulative effect of some of
          these factors, may cause our results of operations to vary
          significantly. If our quarterly results of operations fall below the
          expectations of investors and securities analysts who follow our
          stock, the price of our common stock could decline substantially, and
          we could face costly lawsuits, including securities class action
          suits.
       
          If we are unable to attract new customers, including through our
          self-service customer acquisition model, retain existing customers
          and/or expand usage of our platform by such customers, we may not
          achieve the growth we expect, which would adversely affect our results
          of operations and financial condition.
       
          In order to grow our business, we must continue to attract new
          customers in a cost-effective manner and enable these customers to
          realize the benefits associated with our products and services. Our
          business is usage-based and it is important for our business and
          financial results that our paying customers maintain or increase their
          usage of our platform and purchase additional products from us.
          Historically, we have relied on our self-service customer acquisition
          model for a significant majority of our revenue. While we are
          expanding our direct sales efforts and personnel, we expect a
          significant majority of our revenue to come from our self-service
          customer acquisition model in the coming years. If our self-service
          customer acquisition model is not as effective as we anticipate, our
          future growth will be impacted.
       
          In addition, we must persuade potential customers that our products
          offer significant advantages over those of our competitors. As our
          market matures, our products evolve, and competitors introduce lower
          cost or differentiated products that are perceived to compete with our
          platform and products, our ability to maintain or expand usage of our
          platform could be impaired. Even if we do attract new customers, the
          cost of new customer acquisition, product implementation and ongoing
          customer support may prove higher than anticipated, thereby
       
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          impacting our profitability. For example, while we maintain an active
          user community that serves as a support resource for our customers,
          there is no guarantee that our customers will continue to contribute
          to or utilize the community as a self-support resource, and any
          failure to maintain such an active community could require us to
          expend more resources on customer acquisition and customer support,
          and impact our profitability.
       
          Other factors, many of which are out of our control, may now or in the
          future impact our ability to add new customers in a cost-effective
          manner, include:
       
          •
       
          potential customers’ commitments to existing platforms or greater
          familiarity or comfort with other platforms or products;
       
          •
       
          our failure to expand, retain, and motivate our sales and marketing
          personnel;
       
          •
       
          our failure to obtain or maintain industry security certifications for
          our platform and products;
       
          •
       
          negative media, industry, or financial analyst commentary regarding
          our platform and the identities and activities of some of our
          customers;
       
          •
       
          the perceived risk, commencement, or outcome of litigation; and
       
          •
       
          deteriorating general economic conditions.
       
          The vast majority of our contracts with our customers are based on our
          terms of service, which do not require our customers to commit to a
          specific contractual period, and which permit the customer to
          terminate their contracts or decrease usage of our products and
          services without advance notice. Our customers generally have no
          obligation to maintain their usage of our platform. This ease of
          termination could cause our results of operations to fluctuate
          significantly from quarter to quarter. Our customer retention may
          decline or fluctuate as a result of a number of factors, including our
          customers’ satisfaction with the security, performance, and
          reliability of our products, our prices and usage plans, our
          customers’ budgetary restrictions, the perception that competitive
          products provide better or less expensive options, negative public
          perception of us or our customers, and deteriorating general economic
          conditions. As a result, we may face high rates of customer churn if
          we are unable to meet our customer needs, requirements and
          preferences.
       
          Our future financial performance also depends in part on our ability
          to expand our existing customers’ usage of our platform and sell
          additional products to our existing customers. Conversely, our paying
          customers may reduce their usage to lower-cost pricing tiers if they
          do not see the marginal value in maintaining their usage at a
          higher-cost pricing tier, thereby impacting our ability to increase
          revenue. In order to expand our commercial relationship with our
          customers, existing customers must decide that the incremental cost
          associated with such an increase in usage or subscription to
          additional products is justified by the additional functionality. Our
          customers’ decision whether to increase their usage or subscribe to
          additional products is driven by a number of factors, including
          customer satisfaction with the security, performance, and reliability
          of our platform and existing products, the functionality of any new
          products we may offer, general economic conditions, and customer
          reaction to our pricing model. If our efforts to expand our
          relationship with our existing customers are not successful, our
          financial condition and results of operations may materially suffer.
       
          In addition, to encourage awareness, usage, familiarity and adoption
          of our platform and products, we may offer a credit to new customers
          who sign up for and use our platform. To the extent that we are unable
          to successfully retain customers after use of the initial credit, we
          will not realize the intended benefits of these marketing strategies
          and our ability to grow our revenue will be adversely affected.
       
          The market for our platform and solutions may develop more slowly or
          differently than we expect.
       
          It is difficult to predict customer adoption rates and demand for our
          products and services, the entry of competitive products or services
          or the future growth rate and size of the Infrastructure-as-a-Service
          (IaaS) and
       
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          Platform-as-a-Service (PaaS) markets. The expansion of these markets
          depends on a number of factors, including the cost, performance, and
          perceived value associated with cloud computing platforms as an
          alternative to more established and legacy systems, the ability of
          cloud computing platform providers to address heightened data security
          and privacy concerns, and the cost and effort associated with
          converting or transition from current systems to cloud-based systems.
          If we or other cloud computing platform providers experience security
          incidents, loss of customer data, disruptions or other similar
          problems, the market for these applications as a whole, including our
          platform and products, may be negatively affected. If there is a
          reduction in demand caused by a lack of customer acceptance,
          technological challenges, weakening economic conditions, data security
          or privacy concerns, governmental regulation, competing technologies
          and products, or decreases in information technology spending or
          otherwise, either now or in the future, the market for our platform
          and products might not continue to develop or might develop more
          slowly than we expect, which would adversely affect our business,
          financial condition and results of operations.
       
          Our core customer base consists of individual developers, early stage
          start-ups and small-to-medium size businesses. As these individuals
          and organizations grow, if we are unable to meet their evolving needs,
          we may not be able to retain them as customers. Our business will also
          suffer if the markets for our solutions proves less lucrative than
          projected or if we fail to effectively acquire and service such users.
       
          Our core customer base consists of individual developers, early stage
          start-ups and small-to-medium size businesses, many of which plan for
          high growth. We expect that our path to growth will, in part, rely on
          scaling our platform to meet the needs of such customers as they
          increase usage of our platform. Accordingly, if such customers fail to
          grow as expected, then our path to growth may be adversely affected.
          In addition, our inability to offer both suitable services to support
          their businesses at scale and suitable and appropriately priced
          services for the initial state of their business, and could adversely
          affect our business, financial condition and results of operations.
       
          We believe that the individual developer, early stage start-ups and
          small-to-medium size business markets are underserved, and we intend
          to continue to devote substantial resources to such markets. However,
          these customers and potential customers frequently have limited
          budgets and may choose to allocate resources to items other than our
          solutions, especially in times of economic uncertainty or recessions.
          If the individual developer, early stage start-ups and small-to-medium
          size business markets fail to be as lucrative as we project or we are
          unable to market and sell our services to such customers effectively,
          our ability to grow our revenues quickly and achieve or maintain
          profitability will be harmed.
       
          As we expand our product offerings, we may also attract larger
          customers outside of our core customer base. Sales to larger customers
          involve risks that may not be present or that are present to a lesser
          extent with sales to smaller entities.
       
          Sales to larger customers outside of our core customer base involve
          risks that may not be present or that are present to a lesser extent
          with sales to individual developers, early stage start-ups and
          small-to-medium size businesses, such as longer sales cycles, more
          complex customer requirements, substantial upfront sales costs, and
          less predictability in completing some of our sales. For example,
          larger customers may require considerable time to evaluate and test
          our solutions and those of our competitors prior to making a decision
          on whether to subscribe to our platform. Moreover, larger customers
          often begin to deploy our products on a limited basis, but
          nevertheless demand configuration, integration services and pricing
          negotiations, which increase our upfront investment in the sales
          effort with no guarantee that these customers will deploy our products
          widely enough across their organization to justify our substantial
          upfront investment.
       
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          If we fail to timely release updates and new features to our platform
          and adapt and respond effectively to rapidly changing technology,
          evolving industry standards, changing regulations, or customer needs,
          our platform and products may become less competitive.
       
          Our ability to attract new users and customers, expand our customer
          base, and increase revenue from existing customers depends in large
          part on our ability to enhance and improve our existing platform and
          products, increase adoption and usage of our platform and products,
          and introduce new products and capabilities. The market in which we
          compete is relatively new and subject to rapid technological change,
          evolving industry standards, and changing regulations, as well as
          changing customer needs, requirements and preferences. The success of
          our business will depend, in part, on our ability to adapt and respond
          effectively to these changes on a timely basis, anticipate and respond
          to customer demands and preferences, address business model shifts,
          optimize our go-to-market execution by improving our cost structure,
          align sales coverage with strategic goals, improve channel execution
          and strengthen our services and capabilities in our areas of strategic
          focus. If we were unable to enhance our products and platform
          capabilities to keep pace with rapid technological and regulatory
          change, or if new technologies emerge that are able to deliver
          competitive products at lower prices, more efficiently, more
          conveniently, or more securely than our products, our business,
          financial condition and results of operations could be adversely
          affected.
       
          We expect that the number of integrations and developer tools we will
          need to support will continue to expand as developers adopt new
          technologies, and we will have to develop new or upgraded versions of
          our platform and products to work with those new platforms. This
          development effort may require significant engineering, sales and
          marketing resources, all of which would adversely affect our business.
          Any failure of our platform or products to operate effectively with
          future technologies and developer tools could reduce the demand for
          our platform and products. If we are unable to respond to these
          changes in a cost-effective manner, our platform may become less
          marketable and less competitive or obsolete, and our business,
          financial condition and results of operations could be adversely
          affected.
       
          Our policies regarding user privacy could cause us to experience
          adverse business and reputational consequences with customers,
          employees, suppliers, government entities, users, and other third
          parties.
       
          From time to time, government entities and law enforcement bodies may
          seek our assistance with obtaining information about our customers or
          users. Although we protect the privacy of our customers to the extent
          possible, we may be required from time to time to provide information
          about our customers to government entities and law enforcement bodies.
          In light of our privacy commitments, we may legally challenge law
          enforcement requests to provide access to our systems, customer
          Droplets, or other user content but may face complaints that we have
          provided information improperly to law enforcement or in response to
          third party abuse complaints. We may experience adverse political,
          business, and reputational consequences, to the extent that we (a) do
          not provide assistance to or comply with requests from government
          entities or challenge those requests publicly or in court or
          (b) provide, or are perceived as providing, assistance to government
          entities that exceeds our legal obligations. Any such disclosure could
          significantly and adversely impact our business and reputation.
       
          We publish a transparency report on an annual basis to provide details
          of law enforcement and government requests we receive. Our
          transparency report also includes a list of certain actions we have
          taken in response to law enforcement requests, including disclosure of
          information in response to law enforcement requests, as well as our
          standard policies and procedures regarding any such requests. Both the
          publishing of our transparency report and, conversely, the actions we
          take or challenge in response to law enforcement requests could damage
          our business and reputation.
       
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          We rely on third-party data center providers to ensure the
          functionality of our platform and products. If our data center
          providers fail to meet the requirement of our business, or if our data
          center facilities experience damage, interruption or a security
          breach, our ability to provide access to our platform and maintain the
          performance of our network could be negatively impacted.
       
          We operate fourteen data centers through leases with third-party data
          center providers located in the United States, India, Germany, the
          United Kingdom, Canada, the Netherlands and Singapore. Our business is
          reliant on these data center facilities. Given that we lease this data
          center space, we do not control the operation of these third-party
          facilities. Consequently, we may be subject to service disruptions as
          well as failures to provide adequate support for reasons that are
          outside of our direct control. All of our data center facilities and
          network infrastructure are vulnerable to damage or interruption from a
          variety of sources including earthquakes, floods, fires, power loss,
          system failures, computer viruses, physical or electronic break-ins,
          human error, malfeasance or interference, including by employees,
          former employees, or contractors, terrorism and other catastrophic
          events. We and our data centers have experienced, and may in the
          future experience, disruptions, outages and other performance problems
          due to a variety of factors, including infrastructure changes and
          capacity constraints, due to an overwhelming number of customers
          accessing our platform simultaneously. Data center facilities housing
          our network infrastructure may also be subject to local administrative
          actions, changes to legal or permitting requirements, labor disputes,
          litigation to stop, limit, or delay operations, and other legal
          challenges, including local government agencies seeking to gain access
          to customer accounts for law enforcement or other reasons. In
          addition, while we have entered into various agreements for the lease
          of data center space, equipment, maintenance and other services, the
          third party could fail to live up to the contractual obligations under
          those agreements.
       
          Other factors, many of which are beyond our control, that can affect
          the delivery, performance, and availability of our platform and
          products include:
       
          •
       
          the development, maintenance, and functioning of the infrastructure of
          the internet as a whole;
       
          •
       
          the performance and availability of third-party telecommunications
          services with the necessary speed, data capacity, and security for
          providing reliable internet access and services;
       
          •
       
          the failure of our redundancy systems, in the event of a service
          disruption at one of the facilities hosting our network
          infrastructure, to redistribute load to other components of our
          network;
       
          •
       
          the failure of our disaster recovery and business continuity plans;
          and
       
          •
       
          decisions by the owners and operators of the co-location and
          ISP-partner facilities where our network infrastructure is deployed or
          by global telecommunications service provider partners who provide us
          with network bandwidth to terminate our contracts, discontinue
          services to us, shut down operations or facilities, increase prices,
          change service levels, limit bandwidth, declare bankruptcy, breach
          their contracts with us, or prioritize the traffic of other parties.
       
          The occurrence of any of these factors, or our inability to
          efficiently and cost-effectively fix such errors or other problems
          that may be identified, could damage our reputation, negatively impact
          our relationship with our customers, or otherwise materially harm our
          business, results of operations, and financial condition.
       
          The components of our global network are interrelated, such that
          disruptions or outages affecting one or more of our network data
          center facilities may increase the strain on other components of our
          network. In addition, the failure of any of our data center facilities
          for any significant period of time could place a significant strain
          upon the ongoing operation of our business, as we have only limited
          redundant functionality for these facilities, and there may be
          concentration issues regarding the storing and backup of customer
          data. Such a failure of a core data center facility could degrade and
          slow down our network, reduce the functionality of our products for
          our customers, impact our ability to bill our customers, and otherwise
          materially and adversely impact our business, reputation, and results
          of operations.
       
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          In addition, if we do not optimize and operate these data center
          facilities efficiently, or if we fail to expand our data centers to
          meet increased customer demand, it could result in either lack of
          available capacity (resulting in poor service performance or technical
          issues) or excess data center capacity (resulting in increased
          unnecessary costs), both of which could result in the dissatisfaction
          or loss of customers and cause our business, results of operations and
          financial condition to suffer. As we continue to add product and
          service capabilities, our data center networks become increasingly
          complex and operating them becomes more challenging.
       
          The terms of our existing data center agreements and leases vary in
          length and expire on various dates. Upon the expiration or termination
          of our data center facility leases, we may not be able to renew these
          leases on terms acceptable to us, if at all. Even if we are able to
          renew the leases on our existing data centers, rental rates, which
          will be determined based on then-prevailing market rates with respect
          to the renewal option periods and which will be determined by
          negotiation with the landlord after the renewal option periods, may
          increase from the rates we currently pay under our existing lease
          agreements. Migrations to new facilities could also be expensive and
          present technical challenges that may result in downtime for our
          affected customers. There can also be no assurances that our plans to
          mitigate customer downtime for affected customers will be successful.
       
          If we or our third-party service providers experience a security
          breach or unauthorized parties otherwise obtain access to our platform
          or our customers’ data, we may incur significant liabilities and our
          reputation and business may be harmed.
       
          Our platform and products involve the storage and transmission of
          data, including personally identifiable information, and security
          breaches or unauthorized access to our platform and products could
          result in the loss of our or our customers’ or users’ data,
          litigation, indemnity obligations, fines, penalties, disputes,
          investigations and other liabilities. We have been in the past and may
          continue to be in the future the target of cyber-attacks by third
          parties seeking unauthorized access to our or our customers’ or users’
          data or to disrupt our ability to provide our services. While we have
          taken steps to protect the confidential and personal information that
          we have access to, our security measures or those of our third-party
          service providers that store or otherwise process certain of our and
          our customers’ or users’ data on our behalf could be breached or we
          could suffer a loss of our or our customers’ or users’ data. Our
          ability to monitor our third-party service providers’ data security is
          limited. Cyber-attacks, computer malware, viruses, social engineering
          (including spear phishing and ransomware attacks), and general hacking
          have become more prevalent in our industry, particularly against cloud
          services. In addition, errors due to the action or inaction of our
          employees, contractors, or others with authorized access to our
          network could lead to a variety of security incidents. Further, we do
          not directly control content that our customers or users store, use,
          or access in our products. If our customers or users use our products
          for the transmission or storage of personally identifiable information
          and our security measures are or are believed to have been breached as
          a result of third party action, employee error, malfeasance or
          otherwise, our reputation could be damaged, our business may suffer,
          and we could incur significant liability. In addition, our remediation
          efforts may not be successful.
       
          We also process, store and transmit our own data as part of our
          business and operations. This data may include personally
          identifiable, confidential or proprietary information. There can be no
          assurance that any security measures that we or our third party
          service providers have implemented will be effective against current
          or future security threats. While we have developed systems and
          processes to protect the integrity, confidentiality and security of
          our and our customers’ or users’ data, our security measures or those
          of our third party service providers could fail and result in
          unauthorized access to or disclosure, modification, misuse, loss or
          destruction of such data.
       
          Because there are many different security breach techniques and such
          techniques continue to evolve, we may be unable to anticipate
          attempted security breaches, react in a timely manner or implement
          adequate preventative measures. Third parties may also conduct attacks
          designed to temporarily deny customers or users access to our cloud
          services. Any security breach or other security incident, or the
          perception that one has occurred, could result in a loss of customer
          confidence in the security of our platform and damage to our brand,
       
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          reduce the demand for our products, disrupt normal business
          operations, require us to spend material resources to investigate or
          correct the breach and to prevent future security breaches and
          incidents, expose us to legal liabilities, including litigation,
          regulatory enforcement, and indemnity obligations, and adversely
          affect our business, financial condition and results of operations.
          These risks are likely to increase as we continue to grow and process,
          store, and transmit increasingly large amounts of data.
       
          Additionally, although we maintain cybersecurity insurance coverage,
          we cannot be certain that such coverage will be adequate for data
          security liabilities actually incurred, will cover any indemnification
          claims against us relating to any incident, will continue to be
          available to us on economically reasonable terms, or at all, or that
          any insurer will not deny coverage as to any future claim. The
          successful assertion of one or more large claims against us that
          exceed available insurance coverage, or the occurrence of changes in
          our insurance policies, including premium increases or the imposition
          of large deductible or co-insurance requirements, could adversely
          affect our reputation, business, financial condition and results of
          operations.
       
          In addition, our customers require and expect that we and/or our
          service providers maintain industry-related compliance certifications,
          such as SOC 1, SOC 2, SOC 3, PCI-DSS, NIST 800-53, and others. There
          are significant costs associated with maintaining existing and
          implementing any newly-adopted industry-related compliance
          certifications, including costs associated with retroactively building
          security controls into services which may involve re-engineering
          technology, processes and staffing. The inability to maintain
          applicable compliance certifications could result in monetary fines,
          disruptive participation in forensic audits due to a breach,
          security-related control failures, customer contract breaches,
          customer churn and brand and reputational harm.
       
          We may not be able to successfully manage our growth, and if we are
          not able to grow efficiently, our business, financial condition and
          results of operations could be harmed.
       
          The growth and expansion of our business will continue to require
          additional management, operational and financial resources. As usage
          of our platform grows, we will need to devote additional resources to
          improving and maintaining our infrastructure and integrating with
          third-party applications. In addition, we will need to appropriately
          scale our internal business systems and our services organization,
          including customer support, to serve our growing customer base, and to
          improve our information technology and financial infrastructure,
          operating and administrative systems and our ability to effectively
          manage headcount, capital and processes, including by reducing costs
          and inefficiencies. Any failure of or delay in these efforts could
          result in impaired system performance and reduced customer
          satisfaction, which would negatively impact our revenue growth and our
          reputation. Even if we are successful in our expansion efforts, they
          will be expensive and complex, and require the dedication of
          significant management time and attention. We cannot be sure that the
          expansion of and improvements to our internal infrastructure will be
          effectively implemented on a timely basis, if at all, and such
          failures could harm our business, financial condition and results of
          operations.
       
          In addition, we must also continue to effectively manage our capital
          expenditures by maintaining and expanding our data center capacity,
          servers and equipment, grow in geographies where we currently have a
          small presence and ensure that the performance, features and
          reliability of our service offerings and our customer service remain
          competitive in a rapidly changing technological environment. If we
          fail to manage our growth, the quality of our platform and products
          may suffer, which could negatively affect our brand and reputation and
          harm our ability to retain and attract customers and employees.
       
          If we underestimate or overestimate our data center capacity
          requirements and our capital expenditures on data centers, servers and
          equipment, our results of operations could be adversely affected.
       
          The costs of building out, leasing and maintaining our data centers
          constitute a significant portion of our capital and operating
          expenses. To manage our capacity while minimizing unnecessary excess
          capacity costs, we continuously evaluate our short and long-term data
          center capacity requirements in order to effectively manage our
          capital expenditures. We may be unable to project accurately the rate
          or timing of increases in volume of
       
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          usage on our platform or to successfully allocate resources to address
          such increases, and may underestimate the data center capacity needed
          to address such increases, and in response, we may be unable to
          increase our data capacity, and increase our capital expenditures on
          servers and other equipment, in an expedient and cost-effective manner
          to address such increases. If we underestimate our data center
          capacity requirements and capital expenditure requirements, we may not
          be able to provide our platform and products to current customers or
          service the expanding needs of our existing customers and may be
          required to limit new customer acquisition or enter into leases or
          other agreements for data centers, servers and other equipment that
          are not optimal, all of which may materially and adversely impair our
          results of operations.
       
          In addition, many of our data center sites are subject to multi-year
          leases. If our capacity needs are reduced, or if we decide to close a
          data center, we may nonetheless be committed to perform our
          obligations under the applicable leases including, among other things,
          paying the base rent for the balance of the lease term and continuing
          to pay for any servers or other equipment. If we overestimate our data
          center capacity requirements and capital expenditures, and therefore
          secure excess data center capacity and servers or other equipment, our
          operating margins could be materially reduced.
       
          We rely on a limited number of suppliers for certain components of the
          equipment we use to operate our network and any disruption in the
          availability of these components could delay our ability to expand or
          increase the capacity of our platform or replace defective equipment.
       
          We do not manufacture the products or components we use to build our
          platform and the related infrastructure. We rely on a limited number
          of suppliers for several components of the equipment we use to operate
          our platform and provide products to our customers. Our reliance on
          these suppliers exposes us to risks, including:
       
          •
       
          reduced control over production costs and constraints based on the
          then current availability, terms, and pricing of these components;
       
          •
       
          limited ability to control the quality, quantity and cost of our
          products or of their components;
       
          •
       
          the potential for binding price or purchase commitments with our
          suppliers at higher than market rates;
       
          •
       
          limited ability to adjust production volumes in response to our
          customers’ demand fluctuations;
       
          •
       
          labor and political unrest at facilities we do not operate or own;
       
          •
       
          geopolitical disputes disrupting our supply chain;
       
          •
       
          business, legal compliance, litigation and financial concerns
          affecting our suppliers or their ability to manufacture and ship our
          products in the quantities, quality and manner we require;
       
          •
       
          impacts on our supply chain from adverse public health developments,
          including outbreaks of contagious diseases such as the ongoing
          COVID-19 pandemic; and
       
          •
       
          disruptions due to floods, earthquakes, storms and other natural
          disasters, particularly in countries with limited infrastructure and
          disaster recovery resources.
       
          In addition, we are continually working to expand and enhance our
          platform features, technology and network infrastructure and other
          technologies to accommodate substantial increases in the volume of
          usage on our platform, the amount of content we host and our overall
          total customers. We may be unable to project accurately the rate or
          timing of these increases or to successfully allocate resources to
          address such increases, and may underestimate the data center capacity
          needed to address such increases, and our limited number of suppliers
       
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          may not be able to quickly respond to our needs, which could have a
          negative impact on customer experience and our financial results. In
          the future, we may be required to allocate additional resources,
          including spending substantial amounts, to build, purchase or lease
          data centers and equipment and upgrade our technology and network
          infrastructure in order to handle increased customer usage, and our
          suppliers may not be able to satisfy such requirements. In addition,
          our network or our suppliers’ networks might be unable to achieve or
          maintain data transmission capacity high enough to process orders or
          download data effectively or in a timely manner. Our failure, or our
          suppliers’ failure, to achieve or maintain high data transmission
          capacity could significantly reduce consumer demand for our products.
          Such reduced demand and resulting loss of traffic, cost increases, or
          failure to accommodate new technologies could harm our business,
          revenue and financial condition.
       
          If we do not or cannot maintain the compatibility of our platform with
          third-party applications that our customers use in their businesses,
          our business will be harmed.
       
          Because our customers choose to integrate our products with certain
          capabilities provided by third-party providers, the functionality and
          popularity of our platform depends, in part, on our ability to
          integrate our platform and applications with developer tools and other
          third-party applications. These third parties may change the features
          of their technologies, restrict our access to their applications, or
          alter the terms governing use of their applications in a manner that
          is adverse to our business. Such changes could functionally limit or
          prevent our ability to use these third-party technologies in
          conjunction with our platform, which would negatively affect adoption
          of our platform and harm our business. If we fail to integrate our
          platform with new third-party applications that our customers use, we
          may not be able to offer the functionality that our customers need,
          which would harm our business.
       
          We rely heavily on the reliability, security and performance of our
          internally developed systems and operations. Any difficulties in
          maintaining these systems may result in damage to our brand, service
          interruptions, decreased customer service or increased expenditures.
       
          The reliability and continuous availability of the software, hardware
          and workflow processes underlying our internal systems, networks and
          infrastructure and the ability to deliver our products are critical to
          our business. Any interruptions resulting in our inability to timely
          deliver our products, or materially impacting the efficiency or cost
          with which we provide our products, would harm our brand,
          profitability and ability to conduct business. If third-party vendors
          increase their prices and we are unable to successfully pass those
          costs on to our customers, it could have a substantial effect on our
          results of operations.
       
          We rely on third-party software for certain essential financial and
          operational services, and a failure or disruption in these services
          could materially and adversely affect our ability to manage our
          business effectively.
       
          We rely on third-party software to provide many essential financial
          and operational services to support our business, including, without
          limitation, encryption and authentication technology, infrastructure
          operations, employee email, content delivery to customers, back-office
          support, credit card processing and other functions. Many of these
          vendors are less established and have shorter operating histories than
          traditional software vendors. Moreover, these vendors provide their
          services to us via a cloud-based model instead of software that is
          installed on our premises. As a result, we depend upon these vendors
          to provide us with services that are always available and are free of
          errors or defects that could cause disruptions in our business
          processes. Any failure by these vendors to do so, or any disruption in
          our ability to access the internet, would materially and adversely
          affect our ability to manage our operations. In addition, although we
          have developed systems and processes that are designed to protect
          customer and user data and prevent data loss and other security
          breaches, including systems and processes designed to reduce the
          impact of a security breach at a third-party service provider, such
          measures cannot provide absolute security.
       
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          Performance problems or defects associated with our platform may
          adversely affect our business, financial condition and results of
          operations.
       
          It may become increasingly difficult to maintain and improve our
          platform performance, especially during peak usage times and as our
          customer base grows and our platform becomes more complex. If our
          platform is unavailable or if our customers are unable to access our
          platform within a reasonable amount of time or at all, we may
          experience a loss of customers, lost or delayed market acceptance of
          our platform, delays in payment to us by customers, injury to our
          reputation and brand, legal claims against us, significant cost of
          remedying these problems and the diversion of our resources. In
          addition, to the extent that we do not effectively address capacity
          constraints, upgrade our systems as needed and continually develop our
          technology and network architecture to accommodate actual and
          anticipated changes in technology, our business, financial condition
          and results of operations, as well as our reputation, may be adversely
          affected.
       
          Further, the software technology underlying our platform is inherently
          complex and may contain material defects or errors, particularly when
          new products are first introduced or when new features or capabilities
          are released. We have from time to time found defects or errors in our
          platform, and new defects or errors in our existing platform or new
          products may be detected in the future by us or our users. We cannot
          assure you that our existing platform and new products will not
          contain defects. Any real or perceived errors, failures,
          vulnerabilities, or bugs in our platform could result in negative
          publicity or lead to data security, access, retention or other
          performance issues, all of which could harm our business. The costs
          incurred in correcting such defects or errors may be substantial and
          could harm our business. Moreover, the harm to our reputation and
          legal liability related to such defects or errors may be substantial
          and could similarly harm our business.
       
          The markets in which we participate are competitive, and if we do not
          compete effectively, our business, financial condition and results of
          operations could be harmed.
       
          The markets that we serve are highly competitive and rapidly evolving.
          With the introduction of new technologies and innovations, we expect
          the competitive environment to remain intense. We compete primarily
          with large, diversified technology companies that focus on large
          enterprise customers and provide cloud computing as just a portion of
          the services and products that they offer. The primary vendors in this
          category include Amazon (AWS), Microsoft (Azure), Google (GCP), IBM
          and Oracle. We also compete with smaller, niche cloud service
          providers that typically target individuals and smaller businesses,
          simple use cases or narrower geographic markets. Some examples in this
          category include OVH, Vultr, Heroku, and Linode.
       
          Our competitors vary in size and in the breadth and scope of the
          products offered. Many of our competitors and potential competitors,
          particularly our larger competitors, have substantial competitive
          advantages as compared to us, including greater name recognition and
          longer operating histories, larger sales and marketing and customer
          support budgets and resources, the ability to bundle products
          together, larger and more mature intellectual property portfolios,
          greater resources to make acquisitions and greater resources for
          technical assistance and customer support. Further, other potential
          competitors not currently offering competitive solutions may expand
          their product or service offerings to compete with our products and
          platform capabilities, or our current and potential competitors may
          establish cooperative relationships among themselves or with third
          parties that may further enhance their resources and product offerings
          in our addressable market. Our competitors may be able to respond more
          quickly and effectively than we can to new or changing opportunities,
          technologies, standards, and customer requirements. An existing
          competitor or new entrant could introduce new technology that reduces
          demand for our products and platform capabilities.
       
          In addition, some of our actual and potential competitors have been
          acquired by other larger enterprises and have made or may make
          acquisitions or may enter into partnerships or other strategic
          relationships that may provide more comprehensive offerings than they
          individually had offered or achieve greater economies of scale than
          us. In addition, new entrants not currently considered to be
          competitors may enter the market through acquisitions, partnerships or
          strategic relationships.
       
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          For all of these reasons, we may not be able to compete successfully
          against our current or future competitors, and this competition could
          result in the failure of our platform to continue to achieve or
          maintain market acceptance, any of which would harm our business,
          results of operations, and financial condition.
       
          We do not have sufficient history with our pricing model to accurately
          predict the optimal pricing necessary to attract new customers and
          retain existing customers. Our pricing model subjects us to various
          challenges that could make it difficult for us to derive sufficient
          value from our customers.
       
          We have limited experience determining the optimal prices for our
          products and, as a result, we have in the past and expect that we will
          need to change our pricing model from time to time in the future. As
          the market for our products matures, or as new competitors introduce
          new products or services that compete with ours, we may be unable to
          attract new customers using the same pricing models as we have used
          historically. Pricing decisions may also impact the mix of adoption
          among our customers and negatively impact our overall revenue.
          Moreover, certain customers may demand substantial price concessions.
          As a result, in the future we may be required to reduce our prices or
          develop new pricing models, which could adversely affect our revenue,
          gross margin, profitability, financial position, and cash flow.
       
          We generally charge our customers for their usage of our platform, and
          the add-on features and functionality they choose to enable. We do not
          know whether our current or potential customers or the market in
          general will continue to accept this pricing model going forward and,
          if it fails to gain acceptance, our business could be harmed.
       
          If we fail to retain and motivate members of our management team or
          other key employees, or fail to attract additional qualified personnel
          to support our operations, our business and future growth prospects
          would be harmed.
       
          Our success and future growth depend largely upon the continued
          services of our executive officers, particularly Yancey Spruill, our
          Chief Executive Officer. From time to time, there may be changes in
          our executive management team or other key employees resulting from
          the hiring or departure of these personnel. For example, a number of
          our executive officers have only recently joined us. If we do not
          successfully manage executive officer transitions, it could be viewed
          negatively by our customers, employees or investors and could have an
          adverse impact on our business. Our executive officers and other key
          employees are employed on an at-will basis, which means that these
          personnel could terminate their employment with us at any time. The
          loss of one or more of our executive officers, or the failure by our
          executive team to effectively work with our employees and lead our
          company, could harm our business.
       
          In addition, to execute our growth plan, we must attract and retain
          highly qualified personnel. Competition for these personnel is
          intense, especially for engineers experienced in cloud computing and
          infrastructure solutions. From time to time, we have experienced, and
          we expect to continue to experience, difficulty in hiring and
          retaining employees with appropriate qualifications. Many of the
          companies with which we compete for experienced personnel have greater
          resources than we have. If we hire employees from competitors or other
          companies, their former employers may attempt to assert that these
          employees or we have breached their legal obligations, resulting in a
          diversion of our time and resources. In addition, prospective and
          existing employees often consider the value of the equity awards they
          receive in connection with their employment. If the perceived value of
          our equity awards declines, experiences significant volatility, or
          increases such that prospective employees believe there is limited
          upside to the value of our equity awards, it may adversely affect our
          ability to recruit and retain key employees. If we fail to attract new
          personnel or fail to retain and motivate our current personnel, our
          business and future growth prospects would be harmed.
       
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          Our corporate culture has contributed to our success and if we cannot
          maintain this culture as we grow, we could lose the innovation,
          creativity and entrepreneurial spirit we have worked hard to foster,
          which could harm our business.
       
          We believe our corporate culture of rapid innovation, teamwork, and
          attention to customer support has been a key contributor to our
          success to date. We expect to continue to hire aggressively as we
          expand, and if we do not continue to maintain our corporate culture as
          we grow, we may be unable to foster the innovation, creativity and
          entrepreneurial spirit we believe we need to support our growth. Our
          substantial anticipated headcount growth may result in a change to our
          corporate culture, which could harm our business.
       
          If we fail to maintain and enhance our brand, our ability to expand
          our customer base will be impaired and our business, financial
          condition and results of operations may suffer.
       
          We believe that maintaining and enhancing the DigitalOcean brand is
          important to support the marketing and sale of our existing and future
          products to new customers and expand sales of our platform and
          products to existing customers. We also believe that the importance of
          brand recognition will increase as competition in our market
          increases. Successfully maintaining and enhancing our brand will
          depend largely on the effectiveness of our marketing efforts, our
          ability to provide reliable products that continue to meet the needs
          of our customers at competitive prices, our ability to maintain our
          customers’ trust, our ability to continue to develop new functionality
          and use cases, and our ability to successfully differentiate our
          products and platform capabilities from competitive products. Our
          brand promotion activities may not generate customer awareness or
          yield increased revenue, and even if they do, any increased revenue
          may not offset the expenses we incur in building our brand. If we fail
          to successfully promote and maintain our brand, our business,
          financial condition and results of operations may suffer.
       
          Our ability to maintain customer satisfaction depends in part on the
          quality of our customer support. Failure to maintain high-quality
          customer support could have an adverse effect on our business, results
          of operation, and financial condition.
       
          We believe that the successful use of our platform and products
          requires a high level of support and engagement for many of our
          customers, particularly our business customers. In order to deliver
          appropriate customer support and engagement, we must successfully
          assist our customers in deploying and continuing to use our platform
          and products, resolving performance issues, addressing
          interoperability challenges with the customers’ existing IT
          infrastructure, and responding to security threats and cyber-attacks
          and performance and reliability problems that may arise from time to
          time. Because our platform and products are designed to be highly
          configurable and to rapidly implement customers’ reconfigurations,
          customer errors in configuring our platform and products can result in
          significant disruption to our customers. Our support organization
          faces additional challenges associated with our international
          operations, including those associated with delivering support,
          training, and documentation in languages other than English. Increased
          demand for customer support, without corresponding increases in
          revenue, could increase our costs and adversely affect our business,
          results of operations, and financial condition.
       
          In addition, we rely on our user community to serve as a resource for
          questions on any part of our platform. Members of our user community
          are not obligated to participate in discussions with other users, and
          to the extent they do not, our customers’ ability to find answers to
          questions about our platform of services may suffer. If we are unable
          to develop self-service support resources that are easy to use and
          that our customers utilize to resolve their technical issues, or if
          our customers choose not to take advantage of these self-service
          support services, our customers’ experience with our platform may be
          negatively impacted.
       
          There can be no assurance that we will be able to hire sufficient
          support personnel as and when needed, particularly if our sales exceed
          our internal forecasts. To the extent that we are unsuccessful in
          hiring, training, and retaining adequate support resources, our
          ability to provide high-quality and timely support to our customers
       
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          will be negatively impacted, and our customers’ satisfaction and their
          usage of our platform could be adversely affected.
       
          Unfavorable conditions in our industry or the global economy, or
          reductions in information technology spending, could limit our ability
          to grow our business and negatively affect our results of operations.
       
          Our results of operations may vary based on the impact of unfavorable
          changes in our industry or the global economy on us or our customers
          and potential customers. Unfavorable conditions in the economy both in
          the United States and abroad, including conditions resulting from
          changes in gross domestic product growth in the United States or
          abroad, financial and credit market fluctuations, international trade
          relations, political turmoil, natural catastrophes, outbreaks of
          contagious diseases (such as the recent COVID-19 pandemic), warfare
          and terrorist attacks on the United States, Europe or elsewhere, could
          cause a decrease in business investments, including spending on
          information technology, disrupt the timing and cadence of key industry
          events, and negatively affect the growth of our business and our
          results of operations. For example, any reductions in information
          technology spending may fall disproportionately on outsourced and
          cloud-based solutions like ours. In addition, impacts of the COVID-19
          pandemic may be exacerbated by the disproportionate impact it is
          having on the individual developers, early stage start-ups and
          small-to-medium size businesses that make a large portion of our
          customer base, many of which may be forced to shut down or limit
          operations for an indefinite period of time. Economic weakness,
          customer financial difficulties and constrained spending on
          information technology operations could adversely affect our
          customers’ ability or willingness to subscribe to our service
          offerings, delay purchasing decisions and lengthen our sales cycles,
          reduce the usage of our products and services, or increase churn, all
          of which could have an adverse effect on our sales and operating
          results. In addition, our competitors, many of whom are larger and
          have greater financial resources than we do, may respond to
          challenging market conditions by lowering prices in an attempt to
          attract our customers and may be less dependent on key industry events
          to generate sales for their products. Further, the increased pace of
          consolidation in certain industries may result in reduced overall
          spending on our products and solutions. We cannot predict the timing,
          strength, or duration of any economic slowdown, instability, or
          recovery, generally or how any such event may impact our business.
       
          Our current operations are international in scope, and we plan further
          geographic expansion, creating a variety of operational challenges.
       
          A component of our growth strategy involves the further expansion of
          our operations and customer base internationally. We are continuing to
          adapt to and develop strategies to address international markets, but
          there is no guarantee that such efforts will have the desired effect.
          For example, we anticipate that we will need to establish
          relationships with new partners in order to expand into certain
          countries, and if we fail to identify, establish and maintain such
          relationships, we may be unable to execute on our expansion plans. We
          expect that our international activities will continue to grow for the
          foreseeable future as we continue to pursue opportunities in existing
          and new international markets, which will require significant
          dedication of management attention and financial resources.
       
          Our current and future international business and operations involve a
          variety of risks, including:
       
          •
       
          slower than anticipated availability and adoption of cloud-based
          infrastructures and platforms by international businesses;
       
          •
       
          the need to adapt and localize our products for specific countries;
       
          •
       
          greater difficulty collecting accounts receivable and longer payment
          cycles;
       
          •
       
          potential changes in trade relations, regulations, or laws;
       
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          •
       
          more stringent regulations relating to privacy and data security and
          the unauthorized use of, or access to, commercial and personal
          information, particularly in Europe;
       
          •
       
          challenges inherent in efficiently managing, and the increased costs
          associated with, an increased number of employees over large
          geographic distances, including the need to implement appropriate
          systems, policies, benefits, and compliance programs that are specific
          to each jurisdiction;
       
          •
       
          payment issues and other foreign currency risks, including
          fluctuations in exchange rates;
       
          •
       
          laws and business practices favoring local competitors or general
          market preferences for local vendors;
       
          •
       
          political instability or terrorist activities;
       
          •
       
          any legal, political and economic uncertainty surrounding the exit of
          the United Kingdom from the European Union;
       
          •
       
          an outbreak of a contagious disease, including COVID-19, which may
          cause us or our third-party providers and/or customers to temporarily
          suspend our or their respective operations in the affected city or
          country; and
       
          •
       
          adverse tax burdens and foreign exchange restrictions that could make
          it difficult to repatriate earnings and cash.
       
          If we invest substantial time and resources to further expand our
          international operations and are unable to do so successfully and in a
          timely manner, our business and results of operations will suffer.
       
          We are exposed to fluctuations in currency exchange rates and interest
          rates, which could negatively affect our results of operations and our
          ability to invest and hold our cash.
       
          Our sales are denominated in U.S. dollars, and therefore, our revenue
          is not subject to foreign currency risk. However, a strengthening of
          the U.S. dollar could increase the real cost of our platform to our
          customers outside of the United States, which could adversely affect
          our results of operations. Our operating expenses incurred outside the
          United States are denominated in foreign currencies and are subject to
          fluctuations due to changes in foreign currency exchange rates. If we
          are not able to successfully hedge against the risks associated with
          currency fluctuations, our results of operations could be adversely
          affected. In addition, we are exposed to fluctuations in interest
          rates, which has resulted in a negative interest rate environment, in
          which interest rates drop below zero. In this zero interest rate
          environment, any cash that we may hold with financial institutions,
          including cash proceeds received from this offering, will continue to
          yield a storage charge instead of earning interest income, and
          encourages us to spend our cash or make high-risk investments, all of
          which could adversely affect our financial position, results of
          operations, and cash flows.
       
          Our international operations may subject us to potential adverse tax
          consequences.
       
          We are expanding our international operations to better support our
          growth into international markets. The amount of taxes we pay in
          different jurisdictions may depend on the application of the tax laws
          of the various jurisdictions, including the United States, to our
          international business activities, changes in tax rates, new or
          revised tax laws or interpretations of existing tax laws and policies,
          and our ability to operate our business in a manner consistent with
          our corporate structure and intercompany arrangements. The taxing
          authorities of the jurisdictions in which we operate may challenge our
          methodologies for pricing intercompany transactions pursuant to our
          intercompany arrangements or disagree with our determinations as to
          the income and expenses attributable to specific jurisdictions. If
          such a challenge or disagreement were to occur, and our position was
          not sustained, we could be required to pay additional taxes, interest,
          and penalties, which could result in one-time tax charges, higher
          effective tax rates, reduced cash flows and lower overall
          profitability of our operations. Our financial statements could fail
          to reflect adequate reserves to cover such a contingency.
       
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          Our tax provision could also be impacted by changes in accounting
          principles, changes in U.S. federal, state, or international tax laws
          applicable to corporate multinationals such as legislation enacted in
          the United States, other fundamental law changes currently being
          considered by many countries, and changes in taxing jurisdictions’
          administrative interpretations, decisions, policies, and positions.
          For example, on December 22, 2017, tax reform legislation referred to
          as the Tax Cuts and Jobs Act, or the Tax Act, was enacted in the
          United States The Tax Act makes broad and complex changes to the U.S.
          tax code including, among other things, changes to U.S. federal tax
          rates, additional limitations on the deductibility of interest, both
          positive and negative changes to the utilization of future net
          operating loss, or NOL, carryforwards, allowing the expensing of
          certain capital expenditures, and the migration from a “worldwide”
          system of taxation to a territorial system. We are unable to predict
          whether any future changes will occur and, if so, the impact of such
          changes, including on the U.S. federal income tax considerations
          relating to the purchase, ownership and disposition of our common
          stock.
       
          We could be required to collect additional taxes or be subject to
          other tax liabilities that may increase the costs our clients would
          have to pay for our products and adversely affect our results of
          operations.
       
          An increasing number of states have considered or adopted laws that
          attempt to impose tax collection obligations on out-of-state
          companies. Additionally, the Supreme Court of the United States
          recently ruled in South Dakota v. Wayfair, Inc. et al, or Wayfair,
          that online sellers can be required to collect sales and use tax
          despite not having a physical presence in the buyer’s state. In
          response to Wayfair, or otherwise, states or local governments may
          adopt, or begin to enforce, laws requiring us to calculate, collect,
          and remit taxes on sales in their jurisdictions. A successful
          assertion by one or more states requiring us to collect taxes where we
          presently do not do so, or to collect more taxes in a jurisdiction in
          which we currently do collect some taxes, could result in substantial
          tax liabilities, including taxes on past sales, as well as penalties
          and interest. The imposition by state governments or local governments
          of tax collection obligations on out-of-state sellers could also
          create additional administrative burdens for us, put us at a
          competitive disadvantage if they do not impose similar obligations on
          our competitors, and decrease our future sales, which could have a
          material adverse effect on our business and results of operations.
       
          Our ability to use our net operating losses to offset future taxable
          income may be subject to certain limitations.
       
          As of December 31, 2020, we had NOL carryforwards for federal and
          state income tax purposes of approximately $103.2 million and
          $128.1 million, respectively, which may be available to offset taxable
          income in the future, and which expire in various years beginning in
          2032 for federal purposes and 2021 for state purposes if not utilized.
          A lack of future taxable income would adversely affect our ability to
          utilize these NOLs before they expire. Under the Tax Act, as modified
          by the Coronavirus Aid, Relief, and Economic Security Act, or the
          CARES Act, federal net operating losses incurred in tax years
          beginning after December 31, 2017, may be carried forward
          indefinitely, but the deductibility of such federal net operating
          losses in tax years beginning after December 31, 2020, is limited to
          80% of taxable income. It is uncertain if and to what extent various
          states will conform to the Tax Act or the CARES Act. In general, under
          Section 382 of the Internal Revenue Code of 1986, as amended, or the
          Code, a corporation that undergoes an “ownership change” (as defined
          under Section 382 of the Code and applicable Treasury Regulations) is
          subject to limitations on its ability to utilize its pre-change NOLs
          to offset future taxable income. We may experience a future ownership
          change (including, potentially, in connection with this offering)
          under Section 382 of the Code that could affect our ability to utilize
          the NOLs to offset our income. Furthermore, our ability to utilize
          NOLs of companies that we have acquired or may acquire in the future
          may be subject to limitations. There is also a risk that due to
          regulatory changes, such as suspensions on the use of NOLs or other
          unforeseen reasons, our existing NOLs could expire or otherwise be
          unavailable to reduce future income tax liabilities, including for
          state tax purposes. For these reasons, we may not be able to utilize a
          material portion of the NOLs reflected on our balance sheet, even if
          we attain profitability, which could potentially result in increased
          future tax liability to us and could adversely affect our operating
          results and financial condition.
       
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          Changes in our effective tax rate or tax liability may have an adverse
          effect on our results of operations.
       
          Our effective tax rate could increase due to several factors,
          including:
       
          •
       
          changes in the relative amounts of income before taxes in the various
          jurisdictions in which we operate that have differing statutory tax
          rates;
       
          •
       
          changes in tax laws, tax treaties, and regulations or the
          interpretation of them, including the Tax Act;
       
          •
       
          changes to our assessment about our ability to realize our deferred
          tax assets that are based on estimates of our future results, the
          prudence and feasibility of possible tax planning strategies, and the
          economic and political environments in which we do business;
       
          •
       
          the outcome of current and future tax audits, examinations, or
          administrative appeals; and
       
          •
       
          limitations or adverse findings regarding our ability to do business
          in some jurisdictions.
       
          Any of these developments could adversely affect our results of
          operations.
       
          Our leverage could adversely affect our financial condition, our
          ability to raise additional capital to fund our operations, our
          ability to operate our business, our ability to react to changes in
          the economy or our industry, divert our cash flow from operations for
          debt payments and prevent us from meeting our debt obligations.
       
          As of December 31, 2020, our total indebtedness was approximately
          $263.7 million. Our leverage could have a material adverse effect on
          our business and financial condition, including:
       
          •
       
          requiring a substantial portion of cash flow from operations to be
          dedicated to the payment of principal and interest on our
          indebtedness, thereby reducing our ability to use our cash flow to
          fund our operations, capital expenditures and pursue future business
          opportunities;
       
          •
       
          exposing us to increased interest expense, as our degree of leverage
          may cause the interest rates of any future indebtedness, whether fixed
          or floating rate interest, to be higher than they would be otherwise;
       
          •
       
          making it more difficult for us to satisfy our obligations with
          respect to our indebtedness, and any failure to comply with the
          obligations of any of our debt instruments, including restrictive
          covenants, could result in an event of default that accelerates our
          obligation to repay indebtedness;
       
          •
       
          restricting us from making strategic acquisitions;
       
          •
       
          limiting our ability to obtain additional financing for working
          capital, capital expenditures, product development, satisfaction of
          debt service requirements, acquisitions and general corporate or other
          purposes;
       
          •
       
          increasing our vulnerability to adverse economic, industry or
          competitive developments; and
       
          •
       
          limiting our flexibility in planning for, or reacting to, changes in
          our business or market conditions and placing us at a competitive
          disadvantage compared to our competitors who may be better positioned
          to take advantage of opportunities that our leverage prevents us from
          exploiting.
       
          A substantial majority of our indebtedness consists of indebtedness
          under our credit facility with KeyBank National Association, as
          administrative agent, and the other lenders party thereto, which
          matures in 2025. We may not be able to refinance our existing
          indebtedness because of our amount of debt, debt incurrence
       
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          restrictions under our debt agreements or adverse conditions in credit
          markets generally. Our inability to generate sufficient cash flow to
          satisfy our debt obligations, or to refinance our indebtedness on
          commercially reasonable terms or at all, would result in an adverse
          effect on our financial condition and results of operations.
       
          In addition, a portion of our capital expenditures, including
          expenditures on data centers, equipment and servers, is purchased
          through financing arrangements with third parties and other forms of
          indebtedness. If we are unable to meet our obligations under such
          financing arrangements, such vendors may seek recourse against us,
          including seizure of the financed equipment or severs.
       
          Furthermore, we may incur significant additional indebtedness in the
          future. Although the credit agreement that governs substantially all
          of our indebtedness contains restrictions on the incurrence of
          additional indebtedness and entering into certain types of other
          transactions, these restrictions are subject to a number of
          qualifications and exceptions. Additional indebtedness incurred in
          compliance with these restrictions could be substantial. These
          restrictions also do not prevent us from incurring obligations, such
          as trade payables. To the extent we incur additional indebtedness, the
          significant leverage risks described above would be exacerbated.
       
          Our credit agreement imposes significant operating and financial
          restrictions on us and our subsidiaries, which may prevent us from
          capitalizing on business opportunities.
       
          The credit agreement that governs our credit facility imposes
          significant operating and financial restrictions on us. These
          restrictions limit the ability of our subsidiaries, and effectively
          limit our ability to, among other things:
       
          •
       
          incur or guarantee additional debt or issue disqualified equity
          interests;
       
          •
       
          pay dividends and make other distributions on, or redeem or
          repurchase, capital stock;
       
          •
       
          make certain investments;
       
          •
       
          incur certain liens;
       
          •
       
          enter into transactions with affiliates;
       
          •
       
          merge or consolidate;
       
          •
       
          enter into agreements that restrict the ability of restricted
          subsidiaries to make certain intercompany dividends, distributions,
          payments or transfers; and
       
          •
       
          transfer or sell assets.
       
          As a result of the restrictions described above, we will be limited as
          to how we conduct our business and we may be unable to raise
          additional debt or equity financing to compete effectively or to take
          advantage of new business opportunities. The terms of any future
          indebtedness we may incur could include more restrictive covenants. We
          cannot assure you that we will be able to maintain compliance with
          these covenants in the future and, if we fail to do so, that we will
          be able to obtain waivers from the lenders or amend the covenants.
       
          Our failure to comply with the restrictive covenants described above
          as well as other terms of our indebtedness or the terms of any future
          indebtedness from time to time could result in an event of default,
          which, if not cured or waived, could result in our being required to
          repay these borrowings before their due date. If we are forced to
          refinance these borrowings on less favorable terms or are unable to
          refinance these borrowings, our results of operations and financial
          condition could be adversely affected.
       
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          Our reported financial results may be adversely affected by changes in
          accounting principles generally accepted in the United States. If our
          estimates or judgments relating to our critical accounting policies
          prove to be incorrect, our results of operations could be adversely
          affected.
       
          U.S. generally accepted accounting principles, or GAAP, are subject to
          interpretation by the Financial Accounting Standards Board, or FASB,
          the SEC and various bodies formed to promulgate and interpret
          appropriate accounting principles. A change in these principles or
          interpretations could have a significant effect on our reported
          results of operations and could affect the reporting of transactions
          already completed before the announcement of a change.
       
          The preparation of financial statements in conformity with GAAP
          requires management to make estimates and assumptions that affect the
          amounts reported in our consolidated financial statements and
          accompanying notes appearing elsewhere in this prospectus. We base our
          estimates on historical experience and on various other assumptions
          that we believe to be reasonable under the circumstances, as provided
          in the section titled “Management’s Discussion and Analysis of
          Financial Condition and Results of Operations—Critical Accounting
          Policies and Estimates.” The results of these estimates form the basis
          for making judgments about the carrying values of assets, liabilities
          and equity, and the amount of revenue and expenses that are not
          readily apparent from other sources. Significant estimates, judgments,
          and assumptions used in our financial statements include, but are not
          limited to, those related to revenue recognition, accounts receivable
          and related reserves, useful lives and realizability of long lived
          assets, capitalized internal-use software development costs,
          assumptions used in the valuation of warrants, accounting for
          stock-based compensation, and valuation allowances against deferred
          tax assets. These estimates are periodically reviewed for any changes
          in circumstances, facts, and experience. Our results of operations may
          be adversely affected if our assumptions change or if actual
          circumstances differ from those in our assumptions, which could cause
          our results of operations to fall below the expectations of securities
          analysts and investors, resulting in a decline in the market price of
          our common stock.
       
          We may require additional capital to support the growth of our
          business, and this capital might not be available on acceptable terms,
          if at all.
       
          We have funded our operations since inception primarily through equity
          and debt financings and sales of our products. We cannot be certain
          when or if our operations will generate sufficient cash to fully fund
          our ongoing operations or the growth of our business. We intend to
          continue to make investments to support our business, which may
          require us to engage in equity or debt financings to secure additional
          funds. Additional financing may not be available on terms favorable to
          us, if at all. If adequate funds are not available on acceptable
          terms, we may be unable to invest in future growth opportunities,
          which could harm our business, operating results, and financial
          condition. If we incur additional debt, the debt holders would have
          rights senior to holders of common stock to make claims on our assets,
          and the terms of any debt could restrict our operations, including our
          ability to pay dividends on our common stock. Furthermore, if we issue
          additional equity securities, stockholders will experience dilution,
          and the new equity securities could have rights senior to those of our
          common stock. Because our decision to issue securities in the future
          will depend on numerous considerations, including factors beyond our
          control, we cannot predict or estimate the amount, timing, or nature
          of any future issuances of debt or equity securities. As a result, our
          stockholders bear the risk of future issuances of debt or equity
          securities reducing the value of our common stock and diluting their
          interests. Our inability to obtain adequate financing on terms
          satisfactory to us, when we require it, could significantly limit our
          ability to continue to support our business growth, respond to
          business challenges, expand our operations or otherwise capitalize on
          our business opportunities due to lack of sufficient capital. Even if
          we are able to raise such capital, we cannot assure you that it will
          enable us to achieve better operating results or grow our business.
       
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          Acquisitions, strategic investments, partnerships, or alliances could
          be difficult to identify, pose integration challenges, divert the
          attention of management, disrupt our business, dilute stockholder
          value, and adversely affect our business, financial condition and
          results of operations.
       
          We have in the past and may in the future seek to acquire or invest in
          businesses, joint ventures, products and platform capabilities, or
          technologies that we believe could complement or expand our services
          and platform capabilities, enhance our technical capabilities, or
          otherwise offer growth opportunities. Further, our anticipated
          proceeds from this offering increase the likelihood that we will
          devote resources to exploring larger and more complex acquisitions and
          investments than we have previously attempted. Any such acquisition or
          investment may divert the attention of management and cause us to
          incur various expenses in identifying, investigating and pursuing
          suitable opportunities, whether or not the transactions are completed,
          and may result in unforeseen operating difficulties and expenditures.
          In particular, we may encounter difficulties assimilating or
          integrating the businesses, technologies, products and platform
          capabilities, personnel or operations of any acquired companies,
          particularly if the key personnel of an acquired company choose not to
          work for us, their infrastructure is not easily adapted to work with
          our platform, or we have difficulty retaining the customers of any
          acquired business due to changes in ownership, management or
          otherwise.
       
          We could also face risks related to liability for activities of the
          acquired company before the acquisition, including intellectual
          property infringement claims, violations of laws, commercial disputes,
          tax liabilities and other known and unknown liabilities, and
          litigation or other claims in connection with the acquired company,
          including claims from terminated employees, users, former stockholders
          or other third parties, and our efforts to limit such liabilities
          could be unsuccessful. These transactions may also disrupt our
          business, divert our resources, and require significant management
          attention that would otherwise be available for development of our
          existing business. Any such transactions that we are able to complete
          may not result in any synergies or other benefits we had expected to
          achieve, which could result in impairment charges that could be
          substantial. In addition, we may not be able to find and identify
          desirable acquisition targets or business opportunities or be
          successful in entering into an agreement with any particular strategic
          partner. These transactions could also result in dilutive issuances of
          equity securities or the incurrence of debt, contingent liabilities,
          amortization expenses, incremental operating expenses or the
          impairment of goodwill, any of which could adversely affect our
          results of operations.
       
          The recent COVID-19 pandemic and any related economic downturn could
          negatively impact our business, financial condition and results of
          operations.
       
          The extent of the impact of the COVID-19 pandemic on our operational
          and financial performance will depend on future developments. COVID-19
          could adversely affect workforces, economies and financial markets
          globally, potentially leading to an economic downturn and a reduction
          in customer spending on our solutions or an inability for our
          customers, partners, suppliers or vendors or other parties with whom
          we do business to meet their contractual obligations. While it is not
          possible at this time to predict the duration and extent of the impact
          that COVID-19 could have on worldwide economic activity and our
          business in particular, the continued spread of COVID-19 and the
          measures taken by governments, businesses and other organizations in
          response to COVID-19 could adversely impact our business, financial
          condition and results of operations. For example, impacts of the
          COVID-19 pandemic may be exacerbated by the disproportionate impact it
          is having on the individual developers, early stage start-ups and
          small-to-medium size businesses that make a large portion of our
          customer base, many of which may be forced to shut down or limit
          operations for an indefinite period of time. Economic weakness,
          customer financial difficulties and constrained spending on IT
          operations could adversely affect our customers’ ability or
          willingness to subscribe to our service offerings, delay purchasing
          decisions and lengthen our sales cycles, reduce the value of their
          contracts, or increase churn, all of which could have an adverse
          effect on our sales and operating results.
       
          Moreover, to the extent the COVID-19 pandemic adversely affects our
          business, financial condition and results of operations, it may also
          have the effect of heightening many of the other risks described
          in this “Risk
       
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          Factors” section, including but not limited to, those related to our
          ability expand within our existing customer base, acquire new
          customers, develop and expand our sales and marketing capabilities and
          expand internationally.
       
          Our business could be disrupted by catastrophic occurrences and
          similar events.
       
          Our platform and the public cloud infrastructure on which our platform
          relies are vulnerable to damage or interruption from catastrophic
          occurrences, such as earthquakes, floods, fires, power loss,
          telecommunication failures, terrorist attacks, criminal acts,
          sabotage, other intentional acts of vandalism and misconduct,
          geopolitical events, disease, such as the COVID-19 pandemic, and
          similar events. Despite any precautions we may take, the occurrence of
          a natural disaster or other unanticipated problems at our facilities
          or the facilities of our public cloud providers could result in
          disruptions, outages, and other performance and quality problems. If
          we are unable to develop adequate plans to ensure that our business
          functions continue to operate during and after a disaster and to
          execute successfully on those plans in the event of a disaster or
          emergency, our business would be seriously harmed.
       
          Our business could be negatively impacted by changes in the United
          States political environment.
       
          The 2020 presidential, congressional and state elections in the United
          States have resulted in significant uncertainty with respect to, and
          have and could further result in changes in, legislation, regulation,
          and government policy at the federal, state, and local levels. Any
          such changes could significantly impact our business as well as the
          markets in which we compete. Specific legislative and regulatory
          proposals discussed during election campaigns and more recently that
          might materially impact us include, but are not limited to, changes to
          trade agreements, immigration policy, import and export regulations,
          tariffs and customs duties, income tax regulations and the federal tax
          code, public company reporting requirements, and antitrust
          enforcement. Further, an extended federal government shutdown
          resulting from failing to pass budget appropriations, adopt continuing
          funding resolutions, or raise the debt ceiling, and other budgetary
          decisions limiting or delaying deferral government spending, may
          negatively impact U.S. or global economic conditions, including
          corporate and consumer spending, and liquidity of capital markets. To
          the extent changes in the political environment have a negative impact
          on us or on our markets, our business, results of operation and
          financial condition could be materially and adversely affected in the
          future.
       
          Risks Related to Our Regulatory Environment
       
          Activities of our customers or the content on their websites could
          subject us to liability.
       
          We provide products and services that enable our customers and users
          to exchange information and engage in various online activities, and
          our products and services include substantial user-generated content.
          For instance, customers and users include content on their Droplets,
          post or generate content on our website’s community section, and offer
          applications and integrations through our marketplace. Customer or
          user content or activity may be infringing, illegal, hostile,
          offensive, unethical, or inappropriate, may violate our terms of
          service or a customer’s own policies, or may be intended to, or
          inadvertently, circumvent or threaten the confidentiality, integrity,
          security or availability of information or network services of other
          products, services, or systems, including, for example, by launching
          various attacks. We are not currently subject to lawsuits arising from
          the conduct of our customers or users, or subject to other regulatory
          enforcement actions relating to their content or actions, but we may
          be subject to such suits or measures in the future. Even if claims
          against us are ultimately unsuccessful, defending against such claims
          will increase our legal expenses and divert management’s attention
          from the operation of our business, which could adversely impact our
          business and results of operations, and our brand, reputation, and
          financial results may be harmed.
       
          We (like other intermediary online service providers) rely primarily
          on two sets of laws in the U.S. to shield us from legal liability with
          respect to user activity. The Digital Millennium Copyright Act, or
          DMCA, provides service
       
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          providers a safe harbor from monetary damages for copyright
          infringement claims, provided that service providers comply with
          various requirements designed to stop or discourage infringement on
          their platforms by their users. Section 230 of the Communications
          Decency Act, or CDA, protects providers of an interactive computer
          service from liability with respect to most types of content provided
          over their service by others, including users. Both the DMCA safe
          harbor and Section 230 of the CDA face regular and current, calls for
          revision. In particular, a recent executive order by President Trump
          required, among other things, that the Federal Communications
          Commission, or FCC, consider whether to conduct a rulemaking
          proceeding that might reinterpret and narrow the protections of
          Section 230 of the CDA. The FCC announced in October 2020 that it is
          commencing that rulemaking proceeding. In addition, a variety of bills
          have recently been introduced in the U.S. Congress that would seek to
          make changes to the scope of Section 230 of the CDA, including
          legislation in the U.S. Congress that, if enacted, would narrow the
          protections of Section 230 of the CDA. Enactment of this legislation
          or an unfavorable outcome of the FCC rulemaking could limit our
          ability to rely on the protections of Section 230 of the CDA.
          Furthermore, recent litigation has created uncertainty with respect to
          the applicability of DMCA protections to companies that host
          substantial amounts of user content. For these reasons and others, now
          or in the future, the DMCA, CDA, and similar provisions may be
          interpreted as not applying to us or may provide us with incomplete or
          insufficient protection from claims.
       
          We do not typically monitor the content, activities, or Droplets of
          our customers or users, so inappropriate content may be posted or
          activities executed before we are able to take protective action,
          which could subject us to legal liability. Even if we comply with
          legal obligations to remove or disable content, we may continue to
          allow use of our products or services by individuals or entities who
          others find hostile, offensive, or inappropriate. The activities or
          content of our customers or users may lead us to experience adverse
          political, business and reputational consequences, especially if such
          use is high profile. Conversely, actions we take in response to the
          activities of our customers or users, up to and including banning them
          from using our products, services, or websites, may harm our brand and
          reputation.
       
          In addition to liability based on our activities in the U.S., we may
          also be deemed subject to laws in other countries that may not have
          the same protections or that may impose more onerous obligations on
          us, which may impose additional liability or expense on us, including
          additional theories of intermediary liability. For example, in 2019,
          the EU approved a copyright directive that will impose additional
          obligations on online platforms, and failure to comply could give rise
          to significant liability. Other recent laws in Germany (extremist
          content), Australia (violent content), India (intermediary liability)
          and Singapore (online falsehoods), as well as other new similar laws,
          may also expose cloud-computing companies like us to significant
          liability. We may incur additional costs to comply with these new
          laws, which may have an adverse effect on our business, results of
          operations, and financial condition. Potential litigation could expose
          us to claims for damages and affect our business, financial condition
          and results of operations.
       
          Our business could be affected by the enactment of new governmental
          regulations regarding the internet or the application of additional or
          different existing governmental regulation to our business, products,
          or services.
       
          The legal and regulatory environment pertaining to the internet and
          products and services such as ours, both in the U.S. and
          internationally, is uncertain and may change. New laws may be passed,
          existing but previously inapplicable or unenforced laws may be deemed
          to apply, legal safe harbors may be narrowed, and courts may issue
          decisions affecting existing regulations or leading to new ones.
          Furthermore, legal and regulatory authorities, both in the U.S. and
          internationally, may characterize or recharacterize us and our
          business, products, or services in ways that would apply additional or
          different regulations to us. These changes could affect, among other
          things, areas related to our business such as the following:
       
          •
       
          the liability of online service providers for actions by customers or
          users, including fraud, illegal content, spam, phishing, libel and
          defamation, hate speech, infringement of third-party intellectual
          property and other abusive conduct;
       
          •
       
          other claims based on the nature and content of internet materials;
       
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          •
       
          user data privacy and security issues;
       
          •
       
          consumer protection risks;
       
          •
       
          digital marketing aspects;
       
          •
       
          characteristics and quality of services, including changes to
          networking relationships and anti-circumvention technologies;
       
          •
       
          the contractual terms within our terms of service and other agreements
          with customers;
       
          •
       
          cross-border e-commerce issues; and
       
          •
       
          ease of access by our users to our platform.
       
          New laws or regulations, or new applications or interpretations of
          existing laws or regulations, could hinder growth and decrease
          acceptance, both of the internet and online services, or of our
          specific products or services, both generally or with respect to
          certain uses or industries. Such legal changes could increase our
          costs of doing business, subject our business to increased liability
          for non-compliance, or prevent us from marketing or delivering our
          services over the internet or in specific jurisdictions, thereby
          materially harming our business and results of operations.
       
          The success of our business depends on our customers’ continued and
          unimpeded access to our platform on the internet and, as a result,
          also depends on internet providers and the related regulatory
          environment.
       
          Our customers must have internet access in order to use our platform.
          Some internet providers may take measures that affect their customers’
          ability to use our platform, such as degrading the quality of the
          content we transmit over their lines, giving that content lower
          priority, giving other content higher priority than ours, blocking our
          content entirely, or attempting to charge their customers more for
          using our platform.
       
          In December 2010, the FCC adopted net neutrality rules barring
          internet providers from blocking or slowing down access to online
          content, thereby protecting services like ours from such interference.
          The FCC has repealed the net neutrality rules, and it is currently
          uncertain how the U.S. Congress will respond to this decision. To the
          extent network operators attempt to interfere with our platform,
          extract fees from us to deliver our platform or from customers for the
          use of our platform, or otherwise engage in discriminatory practices,
          our business could be adversely impacted. Within such a regulatory
          environment, we could experience discriminatory or anti-competitive
          practices that could impede our domestic and international growth,
          cause us to incur additional expense, or otherwise harm our business.
          The adoption of any new laws or regulations, or the application or
          interpretation of existing laws or regulations to the internet, could
          impact our customers’ continued and unimpeded access to our platform
          on the internet.
       
          We are subject to stringent and changing privacy laws, regulations and
          standards, information security policies and contractual obligations
          related to data privacy and security. Our actual or perceived failure
          to comply with such obligations could harm our business.
       
          We have legal obligations regarding protection and appropriate use of
          personally identifiable and other proprietary information. We are
          subject to a variety of enacted and proposed federal, state, local and
          international laws, directives and regulations relating to the
          collection, use, security, transfer and other processing of personally
          identifiable information. The regulatory framework for privacy and
          security issues worldwide is rapidly evolving and as a result
          implementation standards and enforcement practices are likely to
          remain uncertain for the foreseeable future. We publicly post
          information about our privacy practices but we may be alleged to have
          failed to do so, which could subject us to potential regulatory or
          private party actions if they are
       
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          found to be noncompliant, deceptive, unfair, or misrepresentative. In
          the United States, these include enforcement actions by federal
          agencies and state attorneys general. In addition, privacy advocates
          and industry groups have regularly proposed, and may propose in the
          future, self-regulatory standards with which we must legally comply or
          that contractually apply to us. If we fail to follow these security
          standards even if no customer or user information is compromised, we
          may incur significant fines or experience a significant increase in
          costs or reputational harm.
       
          Laws in all states require businesses to provide notice to customers
          and users whose personally identifiable information has been disclosed
          as a result of a data breach and compliance can be costly. Further,
          California enacted the California Consumer Privacy Act, or CCPA, which
          became effective on January 1, 2020. The CCPA gives California
          residents expanded rights to access and delete their personal
          information, opt out of certain personal information sharing, and
          receive detailed information about how their personal information is
          used. The CCPA provides for civil penalties for violations, as well as
          a private right of action for data breaches that is expected to
          increase data breach litigation. The CCPA may increase our compliance
          costs and potential liability, and adversely affect our business.
          Further, California voters approved a new privacy law, the California
          Privacy Rights Act, or CPRA, in the November 3, 2020 election.
          Effective starting on January 1, 2023, the CPRA will significantly
          modify the CCPA, including by expanding consumers’ rights with respect
          to certain sensitive personal information. The CPRA also creates a new
          state agency that will be vested with authority to implement and
          enforce the CCPA and the CPRA. New legislation proposed or enacted in
          various other states will continue to shape the data privacy
          environment nationally. Certain state laws may be more stringent or
          broader in scope, or offer greater individual rights, with respect to
          confidential, sensitive and personal information than federal,
          international or other state laws, and such laws may differ from each
          other, which may complicate compliance efforts.
       
          Most jurisdictions in which we operate have established legal
          frameworks for privacy and security with which we or our customers
          must comply, including the European Union, or EU. The EU has adopted
          the General Data Protection Regulation, or GDPR, which contains more
          robust obligations on data processors and heavier documentation
          requirements for data protection compliance programs by companies. The
          GDPR also introduced greater control for data subjects (including, for
          example, the “right to be forgotten”), increased data portability for
          EU consumers, data breach notification requirements and increased
          fines of up to 20 million euros or up to 4% of the annual global
          revenue of the noncompliant company, whichever is greater. Such
          penalties are in addition to any civil litigation claims by customers
          and data subjects. In addition to the foregoing, a breach of the GDPR
          could result in regulatory investigations, reputational damage, orders
          to cease/ change our processing of our data, enforcement notices, and/
          or assessment notices (for a compulsory audit).
       
          We will also be subject to evolving European Union laws on data
          export, where data is transferred outside the European Union to us or
          third parties only when a suitable data transfer solution exists to
          safeguard personal data. On July 16, 2020, the Court of Justice of the
          European Union, or the CJEU, issued a decision called Schrems II that
          (a) calls into question certain data transfer mechanisms (such as the
          Standard Contractual Clauses) and (b) invalidates the EU-U.S. Privacy
          Shield on which many companies had relied as an acceptable mechanism
          for transferring such data from the EU to the U.S. Use of the Standard
          Contractual Clauses must now be assessed on a case-by-case basis
          taking into account the legal regime applicable in the destination
          country. We continue to investigate and implement contractual,
          organizational, and technical changes in response to Schrems II, but
          we cannot guarantee that any such changes will be sufficient under
          applicable laws and regulations or by our customers, governments, or
          the public. To the extent that we transfer personal data outside the
          European Union, there is risk that any of our data transfers will be
          halted, limited, or challenged by third parties.
       
          Further, the United Kingdom’s decision to leave the European Union,
          often referred to as Brexit, has created uncertainty with regard to
          data protection regulation in the United Kingdom. Since January 1,
          2021, the United Kingdom has been a “third country” under the GDPR.
          The relationship between the United Kingdom and the European Union in
          relation to certain aspects of data protection law remains unclear,
          for example whether (and when) an Adequacy Decision may be granted by
          the European Commission enabling data transfers from EU
       
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          member states to the United Kingdom and the role of the UK Information
          Commissioner’s Office following the end of the transitional period.
          These changes will lead to additional costs and increase our overall
          risk exposure.
       
          Where we transfer personal data outside the European Economic Area, or
          the EEA, or the United Kingdom to third parties, we do so in
          compliance with relevant data export requirements. There is no
          assurance that these contractual measures and our own privacy and
          security-related safeguards will protect us from the risks associated
          with the third-party processing, storage and transmission of such
          information. Any violation of data or security laws by our third-party
          processors could have a material adverse effect on our business and
          result in the fines and penalties outlined below.
       
          In addition to the GDPR, the European Commission has another draft
          regulation, known as the Regulation on Privacy and Electronic
          Communications, or ePrivacy Regulation, that would replace the current
          ePrivacy Directive. New rules related to the ePrivacy Regulation are
          likely to include enhanced consent requirements in order to use
          communications content and metadata, which may negatively impact our
          platform and products and our relationships with our customers.
       
          Complying with the GDPR and the ePrivacy Regulation, if and when the
          latter becomes effective, may cause us to incur substantial
          operational costs or require us to change our business practices. We
          may not be successful in our efforts to achieve compliance and may
          also experience difficulty retaining or obtaining new European or
          multi-national customers or significantly increased liability with
          respect to these customers pursuant to the terms set forth in our
          engagements with them. While we utilize data centers in the EEA to
          maintain certain customer and user data (which may include personal
          data) originating from the EU in the EEA, we may find it necessary to
          establish additional systems and processes to maintain such data in
          the EEA, which may involve substantial expense and distraction from
          other aspects of our business. Additionally, data localization
          requirements in other jurisdictions may cause us to incur potentially
          significant costs for establishing and maintaining facilities for
          storing and processing such data.
       
          Privacy and data protection laws and industry standards around the
          world may be interpreted and applied in a manner that is inconsistent
          with our existing practices or product and platform capabilities. If
          so, in addition to the possibility of fines, lawsuits, regulatory
          actions and penalties, costs for remediation, and damage to our
          reputation, we could be required to fundamentally change our practices
          or modify our products and platform capabilities, any of which could
          have an adverse effect on our business. Furthermore, the laws,
          regulations, and policies that are applicable to the businesses of our
          customers may limit the use and adoption of, and reduce the overall
          demand for, our products. Privacy and data security concerns, whether
          valid or not valid, may inhibit market adoption of our products,
          particularly in certain industries and foreign countries, including,
          for example, India, where new legislation is expected in the near
          term.
       
          We are subject to anti-corruption, anti-bribery, anti-money
          laundering, and similar laws, and non-compliance with such laws can
          subject us to criminal or civil liability and harm our business,
          financial condition and results of operations.
       
          We are subject to the U.S. Foreign Corrupt Practices Act, or FCPA,
          U.S. domestic bribery laws, the UK Bribery Act, and other
          anti-corruption and anti-money laundering laws in the countries in
          which we conduct activities. Anti-corruption and anti-bribery laws
          have been enforced aggressively in recent years and are interpreted
          broadly to generally prohibit companies, their employees and their
          third-party intermediaries from authorizing, offering or providing,
          directly or indirectly, improper payments or benefits to recipients in
          the public or private sector. As we increase our international sales
          and business, we may engage with business partners and third party
          intermediaries to market our products and to obtain necessary permits,
          licenses, and other regulatory approvals, and may have direct or
          indirect interactions with officials and employees of government
          agencies or state-owned or affiliated entities. We can be held liable
          for the corrupt or other illegal activities of these third-party
          intermediaries, our employees, representatives, contractors, partners
          and agents, even if we do not explicitly authorize such activities.
       
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          We cannot assure you that all of our employees and agents will not
          take actions in violation of our policies and applicable law, for
          which we may be ultimately held responsible. As we increase our
          international sales and business, our risks under these laws may
          increase.
       
          Detecting, investigating, and resolving actual or alleged violations
          of anti-corruption laws, and responding to any action, can require a
          significant diversion of time, resources, and attention from senior
          management and significant defense costs and other professional fees.
          In addition, noncompliance with anti-corruption, anti-bribery, or
          anti-money laundering laws could subject us to whistleblower
          complaints, investigations, various penalties or debarment from
          contracting with certain persons, and other collateral consequences.
          If any subpoenas or investigations are launched, or sanctions are
          imposed, or if we do not prevail in any possible proceeding, our
          business, financial condition and results of operations could be
          harmed. In addition, responding to any action will likely result in a
          significant diversion of management’s attention and resources.
       
          We are subject to governmental export and import controls and economic
          sanctions laws that could impair our ability to compete in
          international markets or subject us to liability if we are not in full
          compliance with applicable laws.
       
          Our business activities are subject to various restrictions under
          United States export and similar laws and regulations, including the
          United States Department of Commerce’s Export Administration
          Regulations and various economic and trade sanctions regulations
          administered by the United States Treasury Department’s Office of
          Foreign Assets Controls. The United States export control laws and
          United States economic sanctions laws include restrictions or
          prohibitions on the sale or supply of certain products and services to
          United States embargoed or sanctioned countries, governments, persons
          and entities. In addition, various countries regulate the import of
          certain technology and have enacted or could enact laws that could
          limit our ability to provide our customers access to our platform or
          could limit our customers’ ability to access or use our platform in
          those countries.
       
          Furthermore, we incorporate encryption technology into certain of our
          products. U.S. export control laws require authorization for the
          export of encryption items. In addition, various countries regulate
          the import of certain encryption technology, including through import
          permitting and licensing requirements, and have enacted laws that
          could limit our ability to distribute our products and services or
          could limit our customers’ ability to implement our products and
          services in those countries. Obtaining the necessary authorizations,
          including any required license, for a particular transaction may be
          time-consuming, is not guaranteed, and may result in the delay or loss
          of sales opportunities.
       
          Although we take precautions to prevent our platform from being
          provided in violation of such laws, our platform may have in the past,
          and could in the future be, provided inadvertently in violation of
          such laws, despite the precautions we take. If we fail to comply with
          these laws and regulations, we and certain of our employees could be
          subject to civil or criminal penalties, including the possible loss of
          export privileges and fines. We may also be adversely affected through
          penalties, reputational harm, loss of access to certain markets, or
          otherwise. In addition, various countries regulate the import and
          export of certain encryption and other technology, including import
          and export permitting and licensing requirements, and have enacted
          laws that could limit our ability to distribute our platform or could
          limit our users’ ability to access our platform in those countries.
       
          Changes in our platform, or future changes in export and import
          regulations may prevent our users with international operations from
          utilizing our platform globally or, in some cases, prevent the export
          or import of our platform to certain countries, governments, or
          persons altogether. Any change in export or import regulations,
          economic sanctions, or related legislation, or change in the
          countries, governments, persons, or technologies targeted by such
          regulations, could result in decreased use of our platform by, or in
          our decreased ability to export or sell subscriptions to our platform
          to, existing or potential users with international operations. Any
          decreased use of our platform or limitation on our ability to export
          or sell our platform would likely adversely affect our business,
          results of operations, and financial results.
       
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          Risks Related to Our Intellectual Property
       
          Any failure to obtain, maintain, protect or enforce our intellectual
          property and proprietary rights could impair our ability to protect
          our proprietary technology and brand.
       
          Our success depends to a significant degree on our ability to obtain,
          maintain, protect and enforce our intellectual property rights. We
          rely on a combination of trademarks, service marks, trade secrets,
          patents, copyrights, contractual restrictions, and confidentiality
          procedures to establish and protect our intellectual and proprietary
          rights, including in our technology, know-how, and brand. Legal
          standards relating to intellectual property rights are uncertain, in
          both the United States and other jurisdictions in which we operate,
          and protecting, monitoring, and defending our intellectual property
          rights might entail significant expense. Intellectual property rights
          that we have or may obtain may be challenged, circumvented,
          invalidated or held unenforceable. Furthermore, even though we attempt
          to enter into contractual provisions with third parties to control
          access to, or the distribution, use, misuse, misappropriation, reverse
          engineering or disclosure of, our intellectual property or technology,
          no assurance can be given that these agreements will be sufficient or
          effective in protecting our intellectual property rights.
       
          Moreover, intellectual property laws, standards, and enforcement
          mechanisms in foreign countries may be uncertain, may not be as
          protective of intellectual property rights as those in the United
          States, or may not be available to us. As we expand our international
          activities, our exposure to unauthorized copying and use of our
          products, services, and other intellectual property will likely
          increase.
       
          Despite our efforts, we may be unable to adequately obtain, maintain,
          protect, and enforce our intellectual property rights or prevent third
          parties from infringing upon, misappropriating or otherwise violating
          our intellectual property rights. If we fail to protect our
          intellectual property rights adequately, our competitors may gain
          access to, or be able to replicate, our proprietary technology,
          products, or services, and our business, financial condition, results
          of operations or prospects may be harmed. Our attempt to enforce our
          intellectual property rights, even if successful, could result in
          costly litigation or diversion of our management’s attention and
          resources, and, as a result, delay sales or the implementation or
          introduction of our products and platform capabilities, or injure our
          reputation.
       
          We may become subject to intellectual property claims from third
          parties, which may subject us to significant liability, increased
          costs, and impede our ability to operate our business.
       
          Our success depends, in part, on our ability to develop and
          commercialize our products and services without infringing,
          misappropriating or otherwise violating the intellectual property
          rights of third parties. However, we may not be aware that our
          products, services, or intellectual property are infringing,
          misappropriating, or violating third party intellectual property
          rights. Additionally, the technology industry is characterized by the
          existence of a large number of patents, copyrights, trademarks, trade
          secrets, and other intellectual and proprietary rights. Companies in
          the industry are often required to defend against litigation claims
          based on allegations of infringement, misappropriation or other
          violations of intellectual property rights, and third parties may
          bring such claims against us. In addition, we may become subject to
          intellectual property disputes or otherwise subjected to liability for
          customer content on our platform. In the past, we have been involved
          in intellectual property disputes regarding our customer’s alleged
          infringement of third party intellectual property. We expect that the
          occurrence of infringement claims is likely to grow as the market for
          our platform and products grows.
       
          Lawsuits are time-consuming and expensive to resolve, and they divert
          management’s time and attention, and our technologies or intellectual
          property may not be able to withstand third party claims against their
          use. Any intellectual property litigation to which we might become a
          party, or for which we are required to provide indemnification, may
          require us to do one or more of the following:
       
          •
       
          cease selling or using products or services that incorporate the
          intellectual property rights that we allegedly infringe,
          misappropriate or violate;
       
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          •
       
          make substantial payments for legal fees, settlement payments or other
          costs or damages;
       
          •
       
          obtain a license, which may not be available on reasonable terms or at
          all, to sell or use the relevant technology; or
       
          •
       
          redesign the allegedly infringing products to avoid infringement,
          misappropriation or violation, which could be costly, time-consuming
          or impossible.
       
          We cannot predict the outcome of lawsuits and cannot ensure that the
          results of any such actions will not have an adverse effect on our
          business, financial condition or results of operations. Although we
          carry general liability insurance, our insurance may not cover
          potential claims of this type or may not be adequate to indemnify us
          for all liability that may be imposed. Even if the claims do not
          result in litigation or are resolved in our favor, these claims, and
          the time and resources necessary to resolve them, could divert the
          resources of our management and harm our business and operating
          results. Moreover, there could be public announcements of the results
          of hearings, motions or other interim proceedings or developments and,
          if securities analysts or investors perceive these results to be
          negative, it could have an adverse effect on the price of our common
          stock.
       
          We use open source software in our products, which could negatively
          affect our ability to sell our services or subject us to litigation or
          other actions.
       
          We use open source software in connection with developing, operating,
          and offering our products, services, and technology, and we expect to
          continue to incorporate open source software in our products,
          services, and technology in the future.
       
          Some open source projects have known vulnerabilities and architectural
          instabilities and are provided on an “as-is” basis which, if not
          properly addressed, could negatively affect the performance of our
          product. Few of the licenses applicable to open source software have
          been interpreted by courts, and there is a risk that these licenses
          could be construed in a manner that could impose unanticipated
          conditions or restrictions on our ability to commercialize our
          products. For example, some open source licenses may, depending on the
          nature of our use and the terms of the applicable license, include
          terms requiring us to offer certain of our solutions for no cost, make
          our source code available, or license our modifications or derivative
          works under the terms of applicable open source licenses. From time to
          time, there have also been claims challenging the ownership rights in
          open source software against companies that incorporate it into their
          products, and the licensors of such open source software provide no
          warranties or indemnities with respect to such claims.
       
          Moreover, we cannot ensure that we have incorporated open source
          software in our products, services, and technology in a manner that is
          consistent with the terms of the applicable license or our current
          policies and procedures. If an author or other third party that
          distributes such open source software were to allege that we had not
          complied with the conditions of one or more of these licenses, we or
          our customers could be subject to lawsuits, and we could incur
          significant legal expenses defending against such allegations, be
          subject to significant damages resulting from the suits, enjoined from
          the sale of our products that contained the open source software, and
          required to comply with onerous conditions or restrictions on these
          products, which could disrupt the distribution and sale of these
          products. Such litigation could be costly for us to defend, have a
          negative effect on our business, financial condition and results of
          operations, or require us to devote additional research and
          development resources to change or reengineer our products or take
          other remedial actions.
       
          Indemnity provisions in various agreements to which we are party
          potentially expose us to substantial liability for infringement or
          misappropriation of intellectual property rights, failure to comply
          with data protection requirements and other losses.
       
          Our agreements with our customers and other third parties may include
          indemnification provisions under which we agree to indemnify or
          otherwise be liable to them for losses suffered or incurred, including
          as a result
       
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          of intellectual property infringement or misappropriation claims or
          for failure to comply with data protection requirements. Large
          indemnity payments could harm our business, financial condition and
          results of operations. Although we attempt to contractually limit our
          liability with respect to such indemnity obligations, we are not
          always successful and may still incur substantial liability related to
          them, and we may be required to cease use of certain functions of our
          platform or products as a result of any such claims. Any dispute with
          a customer or other third party with respect to such obligations could
          have adverse effects on our relationship with such customer or other
          third party and other existing or prospective customers, reduce demand
          for our products and services and adversely affect our business,
          financial conditions and results of operations. In addition, although
          we carry general liability insurance, our insurance may not be
          adequate to indemnify us for all liability that may be imposed or
          otherwise protect us from liabilities or damages with respect to
          claims alleging compromises of customer data, and any such coverage
          may not continue to be available to us on acceptable terms or at all.
       
          Risks Related to Ownership of Our Common Stock
       
          Our stock price may be volatile, and the value of our common stock may
          decline.
       
          The market price of our common stock may be highly volatile and may
          fluctuate or decline substantially as a result of a variety of
          factors, some of which are beyond our control, including:
       
          •
       
          actual or anticipated fluctuations in our financial condition or
          results of operations;
       
          •
       
          variance in our financial performance from expectations of securities
          analysts;
       
          •
       
          changes in the pricing of our products and platform;
       
          •
       
          changes in our projected operating and financial results;
       
          •
       
          changes in laws or regulations applicable to our platform and
          products;
       
          •
       
          announcements by us or our competitors of significant business
          developments, acquisitions, or new offerings;
       
          •
       
          significant data breaches, disruptions to or other incidents involving
          our software;
       
          •
       
          our involvement in litigation;
       
          •
       
          future sales of our common stock by us or our stockholders, as well as
          the anticipation of lock-up releases;
       
          •
       
          changes in senior management or key personnel;
       
          •
       
          the trading volume of our common stock;
       
          •
       
          changes in the anticipated future size and growth rate of our market;
          and
       
          •
       
          general economic and market conditions.
       
          Broad market and industry fluctuations, as well as general economic,
          political, regulatory, and market conditions including those related
          to the recent COVID-19 pandemic, may also negatively impact the market
          price of our common stock. The full impact of the COVID-19 pandemic is
          unknown at this time, but could result in material adverse changes in
          our results of operations for an unknown period of time as the virus
          and its related political, social and economic impacts spread. In
          addition, technology stocks have historically experienced high
       
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          levels of volatility. In the past, companies that have experienced
          volatility in the market price of their securities have been subject
          to securities class action litigation. We may be the target of this
          type of litigation in the future, which could result in substantial
          expenses and divert our management’s attention.
       
          No public market for our common stock currently exists, and an active
          public trading market may not develop or be sustained following this
          offering.
       
          No public market for our common stock currently exists. An active
          public trading market for our common stock may not develop following
          the completion of this offering or, if developed, it may not be
          sustained. The lack of an active market may impair your ability to
          sell your shares at the time you wish to sell them or at a price that
          you consider reasonable. The lack of an active market may also reduce
          the fair value of your shares. An inactive market may also impair our
          ability to raise capital to continue to fund operations by selling
          shares and may impair our ability to acquire other companies or
          technologies by using our shares as consideration.
       
          We will have broad discretion in the use of the net proceeds to us
          from this offering and may not use them effectively.
       
          We will have broad discretion in the application of the net proceeds
          to us from this offering, including for any of the purposes described
          in the section titled “Use of Proceeds,” and you will not have the
          opportunity as part of your investment decision to assess whether the
          net proceeds are being used appropriately. Because of the number and
          variability of factors that will determine our use of the net proceeds
          from this offering, our ultimate use may vary substantially from our
          currently intended use. Investors will need to rely upon the judgment
          of our management with respect to the use of proceeds. Pending use, we
          may invest the net proceeds from this offering in short-term,
          investment-grade, interest-bearing securities, such as money market
          accounts, certificates of deposit, commercial paper, and guaranteed
          obligations of the U.S. government that may not generate a high yield
          for our stockholders. If we do not use the net proceeds that we
          receive in this offering effectively, our business, financial
          condition, results of operations and prospects could be harmed, and
          the market price of our common stock could decline.
       
          Our directors, executive officers and principal stockholders exercise
          significant control over our company, which will limit your ability to
          influence corporate matters.
       
          Our executive officers, directors and principal stockholders
          beneficially own approximately     % of our common stock. As a result,
          these stockholders, if they act together, will be able to control our
          management and affairs and all matters requiring stockholder approval,
          including the election of directors and approval of significant
          corporate transactions. In addition, this concentration of ownership
          may delay or prevent a change in control of our company and make some
          future transactions more difficult or impossible without the support
          of these stockholders. The interests of these stockholders may not
          coincide with our interests or the interests of other stockholders.
       
          Future sales of our common stock in the public market could cause the
          market price of our common stock to decline.
       
          Sales of a substantial number of shares of our common stock in the
          public market following the completion of this offering, or the
          perception that these sales might occur, could depress the market
          price of our common stock and could impair our ability to raise
          capital through the sale of additional equity securities. Many of our
          existing equityholders have substantial unrecognized gains on the
          value of the equity they hold based upon the price of this offering,
          and therefore they may take steps to sell their shares or otherwise
          secure the unrecognized gains on those shares. We are unable to
          predict the timing of or the effect that such sales may have on the
          prevailing market price of our common stock.
       
          All of our directors and officers and the holders of substantially all
          of our capital stock and securities convertible into our capital stock
          are subject to lock-up agreements that restrict their ability to
          transfer shares of
       
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          our capital stock until the opening of trading on the third trading
          day immediately following our release of earnings for the quarter
          ended June 30, 2021, subject to certain exceptions; provided that:
       
          •
       
          up to 20% of the shares (calculating by including shares issuable upon
          exercise of vested and unvested options or RSUs and common stock) held
          by current employees and consultants immediately prior to this
          offering (but excluding current executive officers and directors) may
          be sold beginning at the commencement of trading on the later of (x)
          the first trading day following the 60th day after the date of this
          prospectus and (y) the third trading day immediately following our
          release of earnings for the quarter ended March 31, 2021; and
       
          •
       
          up to 20% of the shares (calculating by including shares issuable upon
          exercise of vested and unvested options or RSUs and common stock) held
          by any other stockholders immediately prior to this offering may be
          sold if, at any time beginning at the commencement of trading on the
          later of (x) the first trading day following the 60th day after the
          date of this prospectus and (y) the third trading day immediately
          following our release of earnings for the quarter ended March 31,
          2021, the last reported closing price of our common stock is at least
          33% greater than the initial public offering price of our common stock
          for 5 out of any 10 consecutive trading days, ending on or after the
          60th day after the date of this prospectus.
       
          Morgan Stanley & Co. LLC and either of Goldman Sachs & Co. LLC or J.P.
          Morgan Securities LLC may, in their sole discretion, permit our
          stockholders who are subject to these lock-up agreements to sell
          shares prior to the expiration of the lock-up agreements, subject to
          applicable notice requirements. If not earlier released, all of the
          shares of common stock subject to the lock-up agreements will become
          eligible for sale upon the opening of trading on the third trading day
          immediately following our release of earnings for the quarter ended
          June 30, 2021, subject to certain exceptions for any shares held by
          our affiliates as defined in Rule 144 under the Securities Act of
          1933, as amended, or the Securities Act.
       
          In addition, after this offering, up to 17,347,244 shares of our
          common stock may be issued upon exercise of outstanding stock options
          or upon settlement of outstanding RSUs as of December 31, 2020, and
                          shares of our common stock are available for future
          issuance under our 2021 Plan and our ESPP, and will become eligible
          for sale in the public market to the extent permitted by the
          provisions of various vesting schedules, exercise limitations, the
          lock-up agreements and Rule 144 and Rule 701 under the Securities Act.
          If these additional shares of common stock are sold, or if it is
          perceived that they will be sold, in the public market, the trading
          price of our common stock could decline.
       
          We intend to register all of the shares of common stock subject to
          Restricted Stock Unit Awards and shares of common stock issuable upon
          exercise of outstanding options or other equity incentives we may
          grant in the future, for public resale under the Securities Act. The
          shares of common stock will become eligible for sale in the public
          market to the extent such shares of common stock subject to Restricted
          Stock Unit Awards are issued or such options are exercised, subject to
          the lock-up agreements described above and compliance with applicable
          securities laws.
       
          Further, based on shares outstanding as of December 31, 2020, holders
          of 71,334,137 shares, or approximately     % of our capital stock
          after the completion of this offering, will have rights, subject to
          some conditions, to require us to file registration statements
          covering the sale of their shares or to include their shares in
          registration statements that we may file for ourselves or other
          stockholders.
       
          Our issuance of additional capital stock in connection with
          financings, acquisitions, investments, our equity incentive plans or
          otherwise will dilute all other stockholders.
       
          We expect to issue additional capital stock in the future that will
          result in dilution to all other stockholders. We expect to grant
          equity awards to employees, directors and consultants under our equity
          incentive plans. We
       
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          may also raise capital through equity financings in the future. As
          part of our business strategy, we may acquire or make investments in
          companies, products or technologies and issue equity securities to pay
          for any such acquisition or investment. Any such issuances of
          additional capital stock may cause stockholders to experience
          significant dilution of their ownership interests and the per share
          value of our common stock to decline.
       
          If securities or industry analysts do not publish research or publish
          unfavorable or inaccurate research about our business, the market
          price and trading volume of our common stock could decline.
       
          The market price and trading volume of our common stock following the
          completion of this offering will be heavily influenced by the way
          analysts interpret our financial information and other disclosures. We
          do not have control over these analysts. If few securities analysts
          commence coverage of us, or if industry analysts cease coverage of us,
          our stock price would be negatively affected. If securities or
          industry analysts do not publish research or reports about our
          business, downgrade our common stock, or publish negative reports
          about our business, our stock price would likely decline. If one or
          more of these analysts cease coverage of us or fail to publish reports
          on us regularly, demand for our common stock could decrease, which
          might cause our stock price to decline and could decrease the trading
          volume of our common stock.
       
          You will experience immediate and substantial dilution in the net
          tangible book value of the shares of common stock you purchase in this
          offering.
       
          The initial public offering price of our common stock is substantially
          higher than the pro forma net tangible book value per share of our
          common stock immediately after this offering. If you purchase shares
          of our common stock in this offering, you will suffer immediate
          dilution of $     per share, or $     per share if the underwriters
          exercise their over-allotment option in full, representing the
          difference between our pro forma as adjusted net tangible book value
          per share after giving effect to the sale of common stock in this
          offering and the initial public offering price of $     per share, the
          midpoint of the price range set forth on the cover page of this
          prospectus. See the section titled “Dilution.”
       
          We do not intend to pay dividends for the foreseeable future and, as a
          result, your ability to achieve a return on your investment will
          depend on appreciation in the price of our common stock.
       
          We have never declared or paid any cash dividends on our capital
          stock, and we do not intend to pay any cash dividends in the
          foreseeable future. Any determination to pay dividends in the future
          will be at the discretion of our board of directors. Accordingly, you
          may need to rely on sales of our common stock after price
          appreciation, which may never occur, as the only way to realize any
          future gains on your investment.
       
          We are an “emerging growth company,” and we cannot be certain if the
          reduced reporting and disclosure requirements applicable to emerging
          growth companies will make our common stock less attractive to
          investors.
       
          We are an “emerging growth company,” as defined in the JOBS Act, and
          we may take advantage of certain exemptions from various reporting
          requirements that are applicable to other public companies that are
          not “emerging growth companies,” including the auditor attestation
          requirements of Section 404 of the Sarbanes-Oxley Act, or Section 404,
          reduced disclosure obligations regarding executive compensation in our
          periodic reports and proxy statements, and exemptions from the
          requirements of holding a nonbinding advisory vote on executive
          compensation and stockholder approval of any golden parachute payments
          not previously approved. Pursuant to Section 107 of the JOBS Act, as
          an emerging growth company, we have elected to use the extended
          transition period for complying with new or revised accounting
          standards until those standards would otherwise apply to private
          companies. As a result, our consolidated financial statements may not
          be comparable to the financial statements of issuers who are required
          to comply with the effective dates for new or revised accounting
          standards that are applicable to public companies, which may make our
          common stock less attractive to investors. In addition, if we cease to
          be an emerging growth company, we will no longer be able to use the
          extended transition period for complying with new or revised
          accounting standards.
       
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          We will remain an emerging growth company until the earliest of:
          (1) the last day of the fiscal year following the fifth anniversary of
          this offering; (2) the last day of the first fiscal year in which our
          annual gross revenue is $1.07 billion or more; (3) the date on which
          we have, during the previous rolling three-year period, issued more
          than $1 billion in non-convertible debt securities; and (4) the last
          day of the fiscal year in which the market value of our common stock
          held by non-affiliates exceeded $700 million as of June 30 of such
          fiscal year.
       
          We cannot predict if investors will find our common stock less
          attractive if we choose to rely on these exemptions. For example, if
          we do not adopt a new or revised accounting standard, our future
          results of operations may not be as comparable to the results of
          operations of certain other companies in our industry that adopted
          such standards. If some investors find our common stock less
          attractive as a result, there may be a less active trading market for
          our common stock, and our stock price may be more volatile.
       
          We will incur increased costs as a result of operating as a public
          company, and our management will be required to devote substantial
          time to compliance with our public company responsibilities and
          corporate governance practices.
       
          As a public company, we will incur significant legal, accounting, and
          other expenses that we did not incur as a private company, which we
          expect to further increase after we are no longer an “emerging growth
          company.” The Sarbanes-Oxley Act, the Dodd-Frank Wall Street Reform
          and Consumer Protection Act, the listing requirements of the New York
          Stock Exchange, and other applicable securities rules and regulations
          impose various requirements on public companies. Our management and
          other personnel devote a substantial amount of time to compliance with
          these requirements. Moreover, these rules and regulations will
          increase our legal and financial compliance costs and will make some
          activities more time-consuming and costly. We cannot predict or
          estimate the amount of additional costs we will incur as a public
          company or the specific timing of such costs.
       
          If we are unable to maintain proper and effective internal controls
          over financial reporting, investor confidence in our company and, as a
          result, the value of our common stock may be adversely impacted. We
          previously identified and remediated a material weakness in our
          internal controls over financial reporting.
       
          Neither our management nor an independent registered public accounting
          firm has ever performed an evaluation of our internal controls over
          financial reporting in accordance with the provisions of the
          Sarbanes-Oxley Act because no such evaluation has been required. We
          will be required, pursuant to Section 404 to furnish a report by
          management on, among other things, the effectiveness of our internal
          controls over financial reporting for the fiscal year ending
          December 31, 2022. In addition, our independent registered public
          accounting firm will be required to attest to the effectiveness of our
          internal controls over financial reporting in our first annual report
          required to be filed with the SEC following the date we are no longer
          an “emerging growth company.” We have recently commenced the costly
          and challenging process of compiling the system and processing
          documentation necessary to perform the evaluation needed to comply
          with Section 404, but we may not be able to complete our evaluation,
          testing and any required remediation in a timely fashion once
          initiated. Our compliance with Section 404 will require that we incur
          substantial expenses and expend significant management efforts. We
          will need to hire additional accounting and financial staff with
          appropriate public company experience and technical accounting
          knowledge and compile the system and process documentation necessary
          to perform the evaluation needed to comply with Section 404.
       
          During the evaluation and testing process of our internal controls, if
          we identify one or more material weaknesses in our internal controls
          over financial reporting, we will be unable to certify that our
          internal controls over financial reporting is effective. A material
          weakness is a deficiency, or combination of deficiencies, in internal
          controls over financial reporting, such that there is a reasonable
          possibility that a material misstatement of the annual or interim
          financial statements will not be prevented or detected on a timely
          basis.
       
          In the course of preparing our audited consolidated financial
          statements for the year ended December 31, 2019, we identified a
          material weakness in our internal controls over financial reporting
          related to secondary
       
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          sales transactions by current and former employees. Specifically, we
          did not design and maintain effective controls to evaluate and assess
          secondary sales transactions in our common stock to determine, in a
          timely manner, whether additional compensation expense was incurred
          based on the nature of the transaction. We have remediated this
          material weakness, which we believe has addressed the underlying cause
          of this issue. We have implemented measures designed to improve our
          internal controls over financial reporting, including monitoring and
          review procedures related to secondary sales transactions to ensure
          accounting personnel are timely informed of the transactions and can
          evaluate and record any additional compensation expense deemed
          necessary.
       
          We cannot assure you that the measures we have taken to date, and
          actions we may take in the future, will prevent or avoid potential
          future material weaknesses in our internal controls over financial
          reporting in the future. Any failure to maintain internal controls
          over financial reporting could severely inhibit our ability to
          accurately report our financial condition or results of operations. If
          we are unable to conclude that our internal controls over financial
          reporting is effective, or if our independent registered public
          accounting firm determines we have a material weakness or significant
          deficiency in our internal controls over financial reporting, we could
          lose investor confidence in the accuracy and completeness of our
          financial reports, the market price of our common stock could decline,
          and we could be subject to sanctions or investigations by the SEC or
          other regulatory authorities. Failure to remedy any material weakness
          in our internal controls over financial reporting, or to implement or
          maintain other effective control systems required of public companies,
          could also restrict our future access to the capital markets.
       
          Anti-takeover provisions in our charter documents and under Delaware
          law could make an acquisition of our company more difficult, limit
          attempts by our stockholders to replace or remove our current
          management and limit the market price of our common stock.
       
          Provisions in our amended and restated certificate of incorporation
          and amended and restated bylaws, as they will be in effect upon the
          completion of this offering, may have the effect of delaying or
          preventing a change of control or changes in our management. Our
          amended and restated certificate of incorporation and amended and
          restated bylaws will include provisions that:
       
          •
       
          authorize our board of directors to issue, without further action by
          the stockholders, shares of undesignated preferred stock with terms,
          rights, and preferences determined by our board of directors that may
          be senior to our common stock;
       
          •
       
          require that any action to be taken by our stockholders be effected at
          a duly called annual or special meeting and not by written consent;
       
          •
       
          specify that special meetings of our stockholders can be called only
          by our board of directors, the chairperson of our board of directors,
          or our chief executive officer;
       
          •
       
          establish an advance notice procedure for stockholder proposals to be
          brought before an annual meeting, including proposed nominations of
          persons for election to our board of directors;
       
          •
       
          establish that our board of directors is divided into three classes,
          with each class serving three-year staggered terms;
       
          •
       
          prohibit cumulative voting in the election of directors;
       
          •
       
          provide that our directors may be removed for cause only upon the vote
          of at least 66 2/3% of our outstanding shares of voting stock;
       
          •
       
          provide that vacancies on our board of directors may be filled only by
          a majority of directors then in office, even though less than a
          quorum; and
       
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          •
       
          require the approval of our board of directors or the holders of at
          least 66 2/3% of our outstanding shares of voting stock to amend our
          bylaws and certain provisions of our certificate of incorporation.
       
          These provisions may frustrate or prevent any attempts by our
          stockholders to replace or remove our current management by making it
          more difficult for stockholders to replace members of our board of
          directors, which is responsible for appointing the members of our
          management. In addition, because we are incorporated in Delaware, we
          are governed by the provisions of Section 203 of the Delaware General
          Corporation Law, which generally, subject to certain exceptions,
          prohibits a Delaware corporation from engaging in any of a broad range
          of business combinations with any “interested” stockholder for a
          period of three years following the date on which the stockholder
          became an “interested” stockholder. Any of the foregoing provisions
          could limit the price that investors might be willing to pay in the
          future for shares of our common stock, and they could deter potential
          acquirers of our company, thereby reducing the likelihood that you
          would receive a premium for your shares of our common stock in an
          acquisition.
       
          Our amended and restated certificate of incorporation will designate
          the Court of Chancery of the State of Delaware and, to the extent
          enforceable, the federal district courts of the United States of
          America as the exclusive forums for substantially all disputes between
          us and our stockholders, which will restrict our stockholders’ ability
          to choose the judicial forum for disputes with us or our directors,
          officers, or employees.
       
          Our amended and restated certificate of incorporation, as will be in
          effect upon the completion of this offering, will provide that the
          Court of Chancery of the State of Delaware is the exclusive forum for
          the following types of actions or proceedings under Delaware statutory
          or common law: any derivative action or proceeding brought on our
          behalf; any action asserting a breach of a fiduciary duty; any action
          asserting a claim against us arising pursuant to the Delaware General
          Corporation Law, our amended and restated certificate of
          incorporation, or our amended and restated bylaws; or any action
          asserting a claim against us that is governed by the internal affairs
          doctrine. The provisions would not apply to suits brought to enforce a
          duty or liability created by the Exchange Act. In addition, our
          amended and restated certificate of incorporation will provide that
          the federal district courts of the United States of America will be
          the exclusive forum for resolving any complaint asserting a cause of
          action arising under the Securities Act, subject to and contingent
          upon a final adjudication in the State of Delaware of the
          enforceability of such exclusive forum provision.
       
          These choice of forum provisions may limit a stockholder’s ability to
          bring a claim in a judicial forum that it finds favorable for disputes
          with us or our directors, officers, or other employees. If a court
          were to find either choice of forum provision contained in our amended
          and restated certificate of incorporation to be inapplicable or
          unenforceable in an action, we may incur additional costs associated
          with resolving such action in other jurisdictions. For example, the
          Court of Chancery of the State of Delaware recently determined that
          the exclusive forum provision of federal district courts of the United
          States of America for resolving any complaint asserting a cause of
          action arising under the Securities Act is not enforceable. However,
          this decision may be reviewed and ultimately overturned by the
          Delaware Supreme Court. If this ultimate adjudication were to occur,
          we would enforce the federal district court exclusive forum provision
          in our amended and restated certificate of incorporation.
       
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          SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
       
          This prospectus contains forward-looking statements about us and our
          industry that involve substantial risks and uncertainties. All
          statements other than statements of historical facts contained in this
          prospectus, including statements regarding our future results of
          operations or financial condition, business strategy and plans and
          objectives of management for future operations, are forward-looking
          statements. In some cases, you can identify forward-looking statements
          because they contain words such as “anticipate,” “believe,”
          “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,”
          “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,”
          “will” or “would” or the negative of these words or other similar
          terms or expressions. These forward-looking statements include, but
          are not limited to, statements concerning the following:
       
          •
       
          our expectations regarding our revenue, expenses and other operating
          results;
       
          •
       
          our ability to achieve profitability on an annual basis and then
          sustain such profitability;
       
          •
       
          future investments in our business, our anticipated capital
          expenditures and our estimates regarding our capital requirements;
       
          •
       
          our ability to acquire new customers and successfully engage and
          expand usage of our existing customers;
       
          •
       
          the costs and success of our marketing efforts, and our ability to
          promote our brand;
       
          •
       
          our reliance on key personnel and our ability to identify, recruit and
          retain skilled personnel;
       
          •
       
          our ability to effectively manage our growth;
       
          •
       
          our ability to compete effectively with existing competitors and new
          market entrants; and
       
          •
       
          the growth rates of the markets in which we compete.
       
          You should not rely on forward-looking statements as predictions of
          future events. We have based the forward-looking statements contained
          in this prospectus primarily on our current expectations and
          projections about future events and trends that we believe may affect
          our business, financial condition and operating results. The outcome
          of the events described in these forward-looking statements is subject
          to risks, uncertainties and other factors described in the section
          titled “Risk Factors” and elsewhere in this prospectus. Moreover, we
          operate in a very competitive and rapidly changing environment. New
          risks and uncertainties emerge from time to time, and it is not
          possible for us to predict all risks and uncertainties that could have
          an impact on the forward-looking statements contained in this
          prospectus. The results, events and circumstances reflected in the
          forward-looking statements may not be achieved or occur, and actual
          results, events or circumstances could differ materially from those
          described in the forward-looking statements.
       
          In addition, statements that “we believe” and similar statements
          reflect our beliefs and opinions on the relevant subject. These
          statements are based on information available to us as of the date of
          this prospectus. And while we believe that information provides a
          reasonable basis for these statements, that information may be limited
          or incomplete. Our statements should not be read to indicate that we
          have conducted an exhaustive inquiry into, or review of, all relevant
          information. These statements are inherently uncertain, and investors
          are cautioned not to unduly rely on these statements.
       
          The forward-looking statements made in this prospectus relate only to
          events as of the date on which the statements are made. We undertake
          no obligation to update any forward-looking statements made in this
          prospectus to reflect events or circumstances after the date of this
          prospectus or to reflect new information or the occurrence of
          unanticipated events, except as required by law. We may not actually
          achieve the plans, intentions or expectations disclosed in our
          forward-looking statements, and you should not place undue reliance on
          our forward-looking statements. Our forward-looking statements do not
          reflect the potential impact of any future acquisitions, mergers,
          dispositions, joint ventures or investments.
       
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          MARKET, INDUSTRY AND OTHER DATA
       
          This prospectus contains statistical data, estimates and forecasts,
          including related to our market opportunity, that are based on
          independent industry publications and other publicly available
          information, as well as other information based on our internal
          sources. This information involves many assumptions and limitations,
          and you are cautioned not to give undue weight to these estimates. We
          have not independently verified the accuracy or completeness of the
          data contained in these industry publications and other publicly
          available information. Further, while we believe our internal research
          is reliable, such research has not been verified by any third party.
          The industry in which we operate is subject to a high degree of
          uncertainty and risk due to a variety of factors, including those
          described in the section titled “Risk Factors,” that could cause
          results to differ materially from those expressed in these
          publications and other publicly available information.
       
          Certain information in the text of this prospectus is contained in
          independent industry publications. None of the industry publications
          referred to in this prospectus were prepared on our or on our
          affiliates’ behalf or at our expense. The source of these independent
          industry publications is provided below:
       
          •
       
          IDC: Open Source Software Use and Engagement Survey (Dec. 2019)
       
          •
       
          IDC: Public Cloud Services Spending Guide (Jun. 2020)
       
          •
       
          IDC: Cloud Pulse Q120 (Jun. 2020)
       
          •
       
          SlashData: Developer Economics - The State of Cloud-Native Development
          (May 2020)
       
          Information contained in the reports referenced above is not a part of
          this prospectus and the inclusion of these sources in this prospectus
          are for reference only.
       
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          USE OF PROCEEDS
       
          We estimate that we will receive net proceeds from the sale of the
          common stock that we are offering of approximately $            
          million (or approximately $             million if the underwriters
          exercise their option to purchase additional shares of our common
          stock from us in full) based on an assumed initial public offering
          price of $             per share of common stock, the midpoint of the
          estimated price range set forth on the cover page of this prospectus,
          after deducting the underwriting discounts and commissions and
          estimated offering expenses payable by us.
       
          Each $1.00 increase (decrease) in the assumed initial public offering
          price of $             per share of common stock would increase
          (decrease) the net proceeds to us from this offering by approximately
          $             million, assuming the number of shares offered by us, as
          set forth on the cover page of this prospectus, remains the same, and
          after deducting the underwriting discounts and commissions and
          estimated offering expenses payable by us. Similarly, each increase
          (decrease) of 1,000,000 shares in the number of shares of common stock
          offered by us would increase (decrease) the net proceeds to us from
          this offering by approximately $             million, assuming the
          assumed initial public offering price of $             per share of
          common stock remains the same, and after deducting the underwriting
          discounts and commissions and estimated offering expenses payable by
          us.
       
          The principal purposes of this offering are to create a public market
          for our common stock, facilitate our future access to the capital
          markets and increase our capitalization and financial flexibility. As
          of the date of this prospectus, we cannot specify with certainty all
          of the particular uses for the net proceeds to us from this offering.
          However, we currently intend to use the net proceeds we receive from
          this offering for general corporate purposes, including working
          capital, operating expenses and capital expenditures. We may also use
          a portion of the net proceeds to acquire complementary businesses,
          services or technologies. However, we do not have agreements or
          commitments to enter into any acquisitions at this time.
       
          We will have broad discretion over how to use the net proceeds to us
          from this offering. We intend to invest the net proceeds to us from
          the offering that are not used as described above in investment-grade,
          interest-bearing instruments.
       
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          DIVIDEND POLICY
       
          We have never declared or paid cash dividends on our capital stock. We
          currently intend to retain all available funds and future earnings, if
          any, to fund the development and expansion of our business, and we do
          not anticipate paying any cash dividends in the foreseeable future.
          Any future determination regarding the declaration and payment of
          dividends, if any, will be at the discretion of our board of directors
          and will depend on then-existing conditions, including our financial
          condition, operating results, contractual restrictions, capital
          requirements, business prospects and other factors our board of
          directors may deem relevant.
       
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          CAPITALIZATION
       
          The following table sets forth our cash and cash equivalents and
          capitalization as of December 31, 2020:
       
          •
       
          on an actual basis;
       
          •
       
          on a pro forma basis, giving effect to (1) the automatic conversion of
          all of our outstanding shares of convertible preferred stock into an
          aggregate of 45,472,229 shares of common stock in connection with the
          completion of this offering; and (2) the reclassification of the
          convertible preferred stock warrant liability to additional paid-in
          capital, as if such conversion, issuance and reclassification had
          occurred on December 31, 2020; and
       
          •
       
          on a pro forma as adjusted basis, giving effect to (1) the pro forma
          adjustments set forth above; and (2) our receipt of estimated net
          proceeds from the sale of shares of common stock that we are offering
          at an assumed initial public offering price of $                per
          share, the midpoint of the estimated price range set forth on the
          cover page of this prospectus, after deducting the underwriting
          discounts and commissions and estimated offering expenses payable by
          us.
       
          You should read this table together with the section titled
          “Management’s Discussion and Analysis of Financial Condition and
          Results of Operations” and our consolidated financial statements and
          related notes included elsewhere in this prospectus.
       
          As of December 31, 2020
       
          Actual
       
          Pro Forma
       
          Pro Forma
          As Adjusted
       
          (in thousands except share and per share
          amounts)
       
          Cash and cash equivalents
       
          $
       
          100,311
       
          $
       
          $
       
          Convertible preferred stock, $0.000025 par value; 45,780,861 shares
          authorized, 45,472,229 shares issued and outstanding, actual; and no
          shares authorized, issued and outstanding, pro forma and pro forma as
          adjusted
       
          173,074
       
          Stockholders’ deficit:
       
          Common stock, $0.000025 par value; 111,400,000 authorized, 45,299,339
          shares issued, actual; 750,000,000 shares authorized, pro forma and
          pro forma as adjusted; shares issued and outstanding, pro forma; and
          shares issued and outstanding, pro forma as adjusted
       
          1
       
          Preferred stock, $0.000025 par value; no shares authorized, issued or
          outstanding, actual; 10,000,000 shares authorized and no shares issued
          or outstanding, pro forma and pro forma as adjusted
       
          —
       
          Treasury stock, at cost (1,968,228 shares at December 31, 2020)
       
          (4,598
       
          ) 
       
          Additional paid-in capital
       
          99,783
       
          Accumulated other comprehensive loss
       
          (245
       
          ) 
       
          Accumulated deficit
       
          (167,035
       
          ) 
       
          Total stockholders’ deficit
       
          (72,094
       
          ) 
       
          Total capitalization
       
          $
       
          100,980
       
          $
       
          $
       
          Each $1.00 increase (decrease) in the assumed initial public offering
          price of $                per share, the midpoint of the estimated
          price range set forth on the cover page of this prospectus, would
          increase (decrease) each of cash, total assets and total stockholders’
          deficit by $                million, assuming that the number of
          shares offered by us, as set forth on the cover page of this
          prospectus, remains the same, and after deducting the underwriting
          discounts and commissions and estimated offering expenses payable by
          us. Similarly, each increase (decrease) of 1,000,000 shares in the
          number of shares of common stock offered by us would increase
          (decrease)
       
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          each of cash, total assets and total stockholders’ deficit by
          $                million, assuming the assumed initial public offering
          price of $                per share of common stock remains the same,
          and after deducting the underwriting discounts and commissions and
          estimated offering expenses payable by us.
       
          The number of shares of common stock that will be outstanding after
          this offering is based on 88,803,340 shares of common stock
          outstanding as of December 31, 2020, and excludes:
       
          •
       
          16,933,494 shares of common stock issuable upon the exercise of stock
          options outstanding as of December 31, 2020 under the 2013 Plan with a
          weighted-average exercise price of approximately $6.73 per share;
       
          •
       
          413,750 shares of common stock subject to RSUs outstanding as of
          December 31, 2020 under the 2013 Plan;
       
          •
       
          308,632 shares of common stock issuable upon the exercise of warrants
          outstanding as of December 31, 2020 with a weighted-average exercise
          price of approximately $1.94 per share;
       
          •
       
          1,654,338 shares of common stock subject to RSUs granted after
          December 31, 2020 under the 2013 Plan;
       
          •
       
                          shares of common stock reserved for future issuance
          under our 2021 Plan, as well as any future increases in the number of
          shares of common stock reserved for issuance under our 2021 Plan; and
       
          •
       
                          shares of common stock reserved for issuance under our
          ESPP, as well as any future increases in the number of shares of
          common stock reserved for future issuance under our ESPP.
       
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          DILUTION
       
          If you invest in our common stock in this offering, your interest will
          be diluted to the extent of the difference between the initial public
          offering price per share of common stock and the pro forma as adjusted
          net tangible book value per share immediately after this offering.
       
          Our historical net tangible book value as of December 31, 2020 was
          $63.7 million, or $1.41 per share. Our pro forma net tangible book
          value as of December 31, 2020 was $                million, or
          $                per share. Pro forma net tangible book value per
          share represents the amount of our total tangible assets less our
          total liabilities, divided by the number of our shares of common stock
          outstanding as of December 31, 2020, after giving effect to: (1) the
          automatic conversion of all of our outstanding shares of convertible
          preferred stock into an aggregate of 45,472,229 shares of common stock
          in connection with the completion of this offering; and (2) the
          reclassification of the convertible preferred stock warrant liability
          to additional paid-in capital, as if such conversion, issuance and
          reclassification had occurred on December 31, 2020.
       
          After giving effect to the sale by us of                shares of
          common stock in this offering at an assumed initial public offering
          price of $                per share, the midpoint of the estimated
          price range set forth on the cover page of this prospectus, and after
          deducting the underwriting discounts and commissions and estimated
          offering expenses payable by us, our pro forma as adjusted net
          tangible book value as of December 31, 2020 would have been
          $                million, or $                per share. This amount
          represents an immediate increase in pro forma as adjusted net tangible
          book value of $                per share to our existing stockholders
          and an immediate dilution in pro forma as adjusted net tangible book
          value of $                per share to new investors purchasing common
          stock in this offering. We determine dilution by subtracting the pro
          forma as adjusted net tangible book value per share after this
          offering from the amount of cash that a new investor paid for a share
          of common stock. The following table illustrates this dilution on a
          per share basis:
       
          Assumed initial public offering price per share
       
          $
       
          Historical net tangible book value per share as of December 31, 2020
       
          $
       
          1.41
       
          Increase per share attributable to the pro forma adjustments described
          above
       
          Pro forma net tangible book value per share as of December 31, 2020
       
          Increase per share attributable to new investors purchasing shares in
          this offering
       
          Pro forma as adjusted net tangible book value per share after this
          offering
       
          Dilution in pro forma as adjusted net tangible book value per share to
          new investors participating in this offering
       
          $
       
          The dilution information discussed above is illustrative only and may
          change based on the actual initial public offering price and other
          terms of this offering. Each $1.00 increase (decrease) in the assumed
          initial public offering price of $                per share of common
          stock, the midpoint of the estimated price range set forth on the
          cover page of this prospectus, would increase (decrease) our pro forma
          as adjusted net tangible book value per share after this offering by
          $                per share and increase (decrease) the dilution to new
          investors by $                per share, in each case assuming the
          number of shares of common stock offered by us, as set forth on the
          cover page of this prospectus, remains the same, and after deducting
          the underwriting discounts and commissions and estimated offering
          expenses payable by us. Similarly, each increase or decrease of
          1,000,000 shares in the number of shares of common stock offered by us
          would increase (decrease) our pro forma as adjusted net tangible book
          value by approximately $                per share and decrease
          (increase) the dilution to new investors by approximately
          $                per share, in each case assuming the assumed initial
          public offering price of $                per share of common stock
          remains the same, and after deducting the underwriting discounts and
          commissions and estimated offering expenses payable by us.
       
          If the underwriters exercise their option to purchase additional
          shares of common stock in full, the pro forma net tangible book value
          per share, as adjusted to give effect to this offering, would be
          $                per share, and
       
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          the dilution in pro forma net tangible book value per share to
          investors in this offering would be $                per share.
       
          The following table summarizes, as of December 31, 2020, on a pro
          forma as adjusted basis as described above, the number of shares of
          our common stock, the total consideration and the average price per
          share (1) paid to us by existing stockholders, and (2) to be paid by
          new investors acquiring our common stock in this offering at an
          assumed initial public offering price of $                per share,
          the midpoint of the estimated price range set forth on the cover page
          of this prospectus, before deducting the underwriting discounts and
          commissions and estimated offering expenses payable by us.
       
          Shares Purchased
       
          Total
          Consideration
       
          Average Price
          Per Share
       
          Number
       
          Percent
       
          Amount
       
          Percent
       
          Existing stockholders
       
          % 
       
          % 
       
          $
       
          New investors
       
          $
       
          Totals
       
          100.0
       
          % 
       
          $
       
          100.0
       
          % 
       
          Each $1.00 increase (decrease) in the assumed initial public offering
          price of $                per share, the midpoint of the estimated
          price range set forth on the cover page of this prospectus, would
          increase (decrease) the total consideration paid by new investors and
          total consideration paid by all stockholders by approximately
          $                million, assuming that the number of shares of common
          stock offered by us, as set forth on the cover page of this
          prospectus, remains the same and after deducting the underwriting
          discounts and commissions.
       
          If the underwriters exercise their option to purchase an
          additional                shares in full, our existing stockholders
          would own    % and investors in this offering would own    % of the
          total number of shares of common stock outstanding upon the closing of
          this offering.
       
          The number of shares of common stock that will be outstanding after
          this offering is based on 88,803,340 shares of common stock
          outstanding as of December 31, 2020, and excludes:
       
          •
       
          16,933,494 shares of common stock issuable upon the exercise of stock
          options outstanding as of December 31, 2020 under the 2013 Plan with a
          weighted-average exercise price of approximately $6.73 per share;
       
          •
       
          413,750 shares of common stock subject to RSUs outstanding as of
          December 31, 2020 under the 2013 Plan;
       
          •
       
          308,632 shares of common stock issuable upon the exercise of warrants
          outstanding as of December 31, 2020 with a weighted-average exercise
          price of approximately $1.94 per share;
       
          •
       
          1,654,338 shares of common stock subject to RSUs granted after
          December 31, 2020 under the 2013 Plan;
       
          •
       
                          shares of common stock reserved for future issuance
          under our 2021 Plan, as well as any future increases in the number of
          shares of common stock reserved for issuance under our 2021 Plan; and
       
          •
       
                          shares of common stock reserved for issuance under our
          ESPP, as well as any future increases in the number of shares of
          common stock reserved for future issuance under our ESPP.
       
          To the extent that any outstanding options are exercised or new
          options are issued under our stock-based compensation plans, or we
          issue additional shares of common stock in the future, there will be
          further dilution to investors participating in this offering.
       
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          SELECTED CONSOLIDATED FINANCIAL DATA
       
          The selected consolidated statements of operations data for the years
          ended December 31, 2018, 2019 and 2020 and the selected consolidated
          balance sheet data as of December 31, 2019 and 2020 have been derived
          from our audited consolidated financial statements included elsewhere
          in this prospectus.
       
          You should read the consolidated financial data set forth below in
          conjunction with our consolidated financial statements and the
          accompanying notes and the information in “Management’s Discussion and
          Analysis of Financial Condition and Results of Operations” contained
          elsewhere in this prospectus. Our historical results are not
          necessarily indicative of the results to be expected for the full year
          or any other period in the future.
       
          Year Ended December 31,
       
          2018
       
          2019
       
          2020
       
          (in thousands, except per share data)
       
          Consolidated Statements of Operations Data:
       
          Revenue
       
          $
       
          203,136
       
          $
       
          254,823
       
          $
       
          318,380
       
          Cost of revenue(1)
       
          97,042
       
          122,259
       
          145,532
       
          Gross profit
       
          106,094
       
          132,564
       
          172,848
       
          Operating expenses:
       
          Research and development(1)
       
          44,934
       
          59,973
       
          74,970
       
          Sales and marketing(1)
       
          29,445
       
          31,340
       
          33,472
       
          General and administrative(1)
       
          59,009
       
          71,156
       
          80,197
       
          Total operating expenses
       
          133,388
       
          162,469
       
          188,639
       
          Loss from operations
       
          (27,294
       
          ) 
       
          (29,905
       
          ) 
       
          (15,791
       
          ) 
       
          Other (income) expense
       
          7,484
       
          9,692
       
          26,866
       
          Loss before income taxes
       
          (34,778
       
          ) 
       
          (39,597
       
          ) 
       
          (42,657
       
          ) 
       
          Income tax expense
       
          1,221
       
          793
       
          911
       
          Net loss attributable to common stockholders
       
          $
       
          (35,999
       
          ) 
       
          $
       
          (40,390
       
          ) 
       
          $
       
          (43,568
       
          ) 
       
          Net loss per share attributable to common stockholders, basic and
          diluted(2)
       
          $
       
          (1.06
       
          ) 
       
          $
       
          (1.06
       
          ) 
       
          $
       
          (1.05
       
          ) 
       
          Weighted-average shares used to compute net loss per share, basic and
          diluted(2)
       
          33,971
       
          38,004
       
          41,658
       
          (1)
       
          Includes stock-based compensation as follows:
       
          Year Ended December 31,
       
                2018      
       
                2019      
       
                2020      
       
          (in thousands)
       
          Cost of revenue
       
          $
       
           42
       
          $
       
           1,142
       
          $
       
          545
       
          Research and development
       
          2,559
       
          4,688
       
          7,765
       
          Sales and marketing
       
          381
       
          539
       
          1,924
       
          General and administrative
       
          9,185
       
          12,277
       
          19,222
       
          Total
       
          $
       
           12,167
       
          $
       
           18,646
       
          $
       
          29,456
       
          Stock-based compensation for the years ended December 31, 2018, 2019
          and 2020 included compensation of $8.0 million, $12.1 million and
          $18.3 million, respectively, related to secondary sales of common
          stock by certain current and former employees, which is primarily
          included in General and administrative. See “Management’s Discussion
          and Analysis of Financial Condition and Results of
          Operations—Comparison of Years Ended December 31, 2019 and
          2020—Operating Expenses” and “—Comparison of Years Ended December 31,
          2018 and 2019—Operating Expenses.”
       
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          (2)
       
          See Note 11 to our consolidated financial statements included
          elsewhere in this prospectus for an explanation of the calculations of
          our basic and diluted net loss per share attributable to common
          stockholders and the weighted-average number of shares used to compute
          the per share amounts.
       
          December 31,
       
          2019
       
          2020
       
          (in thousands)
       
          Consolidated Balance Sheet Data:
       
          Cash and cash equivalents
       
          $
       
           32,906
       
          $
       
          100,311
       
          Total assets
       
          302,485
       
          430,252
       
          Total liabilities
       
          251,501
       
          329,272
       
          Convertible preferred stock
       
          123,264
       
          173,074
       
          Total stockholders’ deficit
       
          (72,280
       
          ) 
       
          (72,094
       
          ) 
       
          Non-GAAP Financial Measures
       
          To supplement our consolidated financial statements, which are
          prepared and presented in accordance with generally accepted
          accounting principles in the United States, or GAAP, we provide
          investors with non-GAAP financial measures including: (i) adjusted
          gross profit and adjusted gross margin; and (ii) adjusted EBITDA.
          These measures are presented for supplemental informational purposes
          only, have limitations as analytical tools and should not be
          considered in isolation or as a substitute for financial information
          presented in accordance with GAAP. Our calculations of each of these
          measures may differ from the calculations of measures with the same or
          similar titles by other companies and therefore comparability may be
          limited. Because of these limitations, when evaluating our
          performance, you should consider each of these non-GAAP financial
          measures alongside other financial performance measures, including the
          most directly comparable financial measure calculated in accordance
          with GAAP and our other GAAP results. A reconciliation of each of our
          non-GAAP financial measures to the most directly comparable financial
          measure calculated in accordance with GAAP is set forth below.
       
          Adjusted Gross Profit and Adjusted Gross Margin
       
          We believe adjusted gross profit and adjusted gross margin, when taken
          together with our GAAP financial results, provides a meaningful
          assessment of our performance, and is useful for the preparation of
          our annual operating budget and quarterly forecasts.
       
          We define adjusted gross profit as gross profit exclusive of
          stock-based compensation, amortization of capitalized internal-use
          software development costs and depreciation of our data center
          equipment included within Cost of revenue. We exclude stock-based
          compensation, which is a non-cash item, because we do not consider it
          indicative of our core operating performance. We exclude depreciation
          and amortization, which primarily relates to our investments in our
          data center servers that are long lived assets with an economic life
          of five years, because it may not reflect our current or future cash
          spending levels to support our business. While the Company intends to
          spend a significant amount on capital expenditures on an absolute
          basis in the coming years, the Company’s capital expenditures as a
          percentage of revenue has declined significantly and will continue to
          decline. We define adjusted gross margin as a percentage of adjusted
          gross profit to revenue.
       
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          The following table presents a reconciliation of gross profit, the
          most directly comparable financial measure stated in accordance with
          GAAP, to adjusted gross profit, for each of the periods presented:
       
          Year Ended December 31,
       
                2018      
       
                2019      
       
              2020    
       
          (dollars in thousands)
       
          Gross profit
       
          $
       
          106,094
       
          $
       
          132,564
       
          $
       
          172,848
       
          Adjustments:
       
          Stock-based compensation(1)
       
          42
       
          1,142
       
          545
       
          Depreciation and amortization(1)
       
          48,906
       
          58,975
       
          69,547
       
          Adjusted gross profit
       
          $
       
          155,042
       
          $
       
          192,681
       
          $
       
          242,940
       
          Gross margin
       
          52
       
          % 
       
          52
       
          % 
       
          54
       
          % 
       
          Adjusted gross margin
       
          76
       
          % 
       
          76
       
          % 
       
          76
       
          % 
       
          (1)
       
          Includes stock-based compensation, amortization of capitalized
          internal-use software development costs and depreciation of our data
          center equipment, in each case, included within Cost of revenue.
       
          Adjusted EBITDA
       
          We define adjusted EBITDA as net loss attributable to common
          stockholders, adjusted to exclude depreciation and amortization,
          stock-based compensation, interest expense, income tax expense, loss
          on extinguishment of debt, restructuring and severance expense, asset
          impairment, revaluation of warrants and other charges. We believe that
          adjusted EBITDA, when taken together with our GAAP financial results,
          provides meaningful supplemental information regarding our operating
          performance and facilitates internal comparisons of our historical
          operating performance on a more consistent basis by excluding certain
          items that may not be indicative of our business, results of
          operations or outlook. In particular, we believe that the use of
          adjusted EBITDA is helpful to our investors as it is a measure used by
          management in assessing the health of our business, determining
          incentive compensation, evaluating our operating performance, and for
          internal planning and forecasting purposes.
       
          Our calculation of adjusted EBITDA may differ from the calculations of
          adjusted EBITDA by other companies and therefore comparability may be
          limited. Because of these limitations, when evaluating our
          performance, you should consider adjusted EBITDA alongside other
          financial performance measures, including our net loss attributable to
          common stockholders and other GAAP results. The following table
          presents a reconciliation of net loss attributable to common
          stockholders, the most directly comparable financial measure stated in
          accordance with GAAP, to adjusted EBITDA for each of the periods
          presented:
       
          Year Ended December 31,
       
                2018      
       
                2019      
       
              2020    
       
          (in thousands)
       
          Net loss attributable to common stockholders
       
          $
       
          (35,999
       
          ) 
       
          $
       
          (40,390
       
          ) 
       
          $
       
          (43,568
       
          ) 
       
          Adjustments:
       
          Depreciation and amortization
       
          52,415
       
          63,081
       
          75,574
       
          Stock-based compensation(1)
       
          12,167
       
          18,646
       
          29,456
       
          Interest expense
       
          6,312
       
          9,356
       
          13,610
       
          Income tax expense
       
          1,221
       
          793
       
          911
       
          Loss on extinguishment of debt
       
          550
       
          —
       
          259
       
          Restructuring and severance expense(2)
       
          938
       
          1,340
       
          4,213
       
          Asset impairment(3)
       
          881
       
          546
       
          1,222
       
          Revaluation of warrants
       
          478
       
          411
       
          12,825
       
          Other(4)
       
          490
       
          1,461
       
          1,392
       
          Adjusted EBITDA
       
          $
       
          39,453
       
          $
       
          55,244
       
          $
       
          95,894
       
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          (1)
       
          Consists of stock-based compensation for the years ended December 31,
          2018, 2019 and 2020 and includes compensation of $8.0 million, $12.1
          million and $18.3 million, respectively, related to secondary sales of
          common stock by certain of our current and former employees.
       
          (2)
       
          Consists primarily of expenses related to changes in our senior
          leadership, sales and infrastructure teams.
       
          (3)
       
          Consists of internal-use software impairment charges related to
          software that is no longer being used.
       
          (4)
       
          Consists primarily of third-party consulting costs to enhance our
          finance function for the years ended December 31, 2018, 2019 and 2020
          of $0.5 million, $1.4 million and $1.4 million, respectively, and
          legal and accounting costs incurred to acquire Nanobox, Inc. for the
          year ended December 31, 2019 of $0.1 million. For more information
          related to our acquisition of Nanobox, Inc., see Note 2 to our
          consolidated financial statements included elsewhere in this
          prospectus.
       
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          MANAGEMENT’S DISCUSSION AND ANALYSIS OF
       
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS
       
          You should read the following discussion and analysis of our financial
          condition and results of operations together with the section titled
          “Selected Consolidated Financial Data” and our consolidated financial
          statements and related notes included elsewhere in this prospectus.
          This discussion and analysis contains forward-looking statements that
          involve risks and uncertainties, including statements related to our
          plans, objectives, expectations, intentions and beliefs. You should
          review the sections titled “Special Note Regarding Forward-Looking
          Statements” and “Risk Factors” for a discussion of forward-looking
          statements and important factors that could cause actual results to
          differ materially from the results described in or implied by the
          forward-looking statements contained in the following discussion and
          analysis.
       
          Overview
       
          DigitalOcean is a leading cloud computing platform offering on-demand
          infrastructure and platform tools for developers, start-ups and small
          and medium-sized businesses, or SMBs. We were founded with the guiding
          principle that the transformative benefits of the cloud should be easy
          to leverage, broadly accessible, reliable and affordable. Our platform
          simplifies cloud computing, enabling our customers to rapidly
          accelerate innovation and increase their productivity and agility.
          Over 570,000 individual and business customers currently use our
          platform to build, deploy and scale software applications. Our users
          include software engineers, researchers, data scientists, system
          administrators, students and hobbyists. Our customers use our platform
          across numerous industry verticals and for a wide range of use cases,
          such as web and mobile applications, website hosting, e-commerce,
          media and gaming, personal web projects, and managed services, among
          many others. We believe that our focus on simplicity, community, open
          source and customer support are the four key differentiators of our
          business, driving a broad range of customers around the world to build
          their applications on our platform.
       
          Improving the developer experience and increasing developer
          productivity are core to our mission. Our developer cloud platform was
          designed with simplicity in mind to ensure that software developers
          can spend less time managing their infrastructure and more time
          turning their ideas into innovative applications to grow their
          businesses. Simplicity guides how we design and enhance our
          easy-to-use-interface, the core capabilities we offer our customers
          and our approach to predictable and transparent pricing for our
          solutions. We offer mission-critical infrastructure solutions across
          compute, storage and networking, and we also enable developers to
          extend the native capabilities of our cloud with fully managed
          application, container and database offerings. In just minutes,
          developers can set up thousands of virtual machines, secure their
          projects, enable performance monitoring and scale up and down as
          needed.
       
          We generate revenue from the usage of our cloud computing platform by
          our customers, including but not limited to compute, storage and
          networking services. We recognize revenue based on the customer
          utilization of these resources. Our pricing is consumption-based and
          billed monthly in arrears, making it easy for our customers to track
          usage on an ongoing basis and optimize their deployments. The pricing
          for each of our products is available on our website. For example, the
          standard price for a Droplet is $5.00 per month, and our Managed
          Database product is available starting at $15.00 per month.
       
          We have historically generated almost all of our revenue from our
          efficient self-service marketing model, which enables customers to get
          started on our platform very quickly and without the need for
          assistance. We focus heavily on enabling a self-service, low-friction
          model that makes it easy for users to try, adopt and use our products.
          For the years ended December 31, 2018, 2019 and 2020, our sales and
          marketing expense was approximately 14%, 12% and 11% of our revenue,
          respectively. The efficiency of our go-to-market model and our focus
          on the needs of the individual and SMB markets have enabled us to
          drive organic growth and establish a truly global customer base across
          a broad range of industries.
       
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          We had approximately 573,000 customers as of December 31, 2020, up
          from approximately 502,000 as of December 31, 2018. Our customers are
          spread across over 185 countries, and around two-thirds of our revenue
          has historically come from customers located outside the United
          States. In 2020, 38% of our revenue was generated from North America,
          30% from Europe, 22% from Asia and 10% from the rest of the world. We
          have a growing number of customers with higher spending levels, and
          our existing customers are continuing to expand their business with
          us. Our average revenue per customer (which we refer to as ARPU) has
          increased significantly, from $35.97 in 2018 to $40.16 in 2019 to
          $47.78 in 2020. We have no material customer concentration as our top
          25 customers made up 11%, 10% and 9% of our revenue in 2018, 2019 and
          2020, respectively.
       
          We have experienced strong and predictable growth in recent periods.
          The following graph shows our increasing quarterly revenue since 2014
          and our annual run-rate revenue, or ARR, as of December 31, 2020. ARR
          as of the end of each month represents total revenue for that month
          multiplied by 12. Our ARR increased 25%, from $285 million as of
          December 31, 2019 to $357 million as of December 31, 2020.
       
          LOGO
       
          Impact of the COVID-19 Pandemic
       
          To date, the COVID-19 pandemic has not had a significant impact on our
          operations or financial performance. However, the extent of the impact
          of the COVID-19 pandemic on our operational and financial performance
          depends on certain developments, including the duration and spread of
          the outbreak, its impact on industry events, and its effect on our
          customers, partners, suppliers and vendors and other parties with whom
          we do business, all of which are uncertain and cannot be predicted at
          this time. To the extent possible, we are conducting business as
          usual, with necessary or advisable modifications to employee travel
          and employee work locations, and conducting our marketing and sales
          activities virtually. We actively monitor the rapidly evolving
          situation related to COVID-19 and may take further actions that alter
          our business operations, including those that may be required by
          federal, state or local authorities, or that we determine are in the
          best interests of our employees, customers, partners, suppliers,
          vendors and stockholders. The extent to which the COVID-19 pandemic
          may impact our results of operations and financial condition remains
          uncertain.
       
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          Key Factors Affecting Our Performance
       
          Increasing Importance of Cloud Computing and Developers
       
          Our future success depends in large part on the continuing adoption of
          cloud computing, proliferation of cloud-native start-ups and SMBs and
          the increasing importance of developers, all of which are driving the
          adoption of our developer cloud platform. We believe our market
          opportunity is large and that these factors will continue to drive our
          growth. We plan to continue to invest significantly in scaling across
          many organizational functions in order to grow our operations both
          domestically and internationally to capitalize on these trends.
       
          Growing our Customer Base
       
          We believe there is a substantial opportunity to further expand our
          customer base, and our future growth depends, in large part, on our
          ability to increase the number of customers using our cloud computing
          platform. We have historically attracted customers by offering a
          low-friction, self-service cloud platform combined with a
          highly-efficient self-service marketing model. Over the three-year
          period from 2018 to 2020, we have added an average of over 50,000
          customers per year. We are investing in strategies that we believe
          will continue to drive new customer adoption, especially among SMB
          customers, such as implementing new marketing initiatives that further
          optimize our self-service revenue funnel and expanding our go-to
          market teams in select international locations. Our ability to attract
          new customers will depend on a number of factors, including our
          success in recruiting and expanding our sales and marketing
          organization and competitive dynamics in our target markets.
       
          Increasing Usage by Our Existing Customers
       
          Our customer base of more than 570,000 customers represents a
          significant opportunity for further consumption of our services. There
          are substantial opportunities to expand revenue within our large
          customer base through increased usage of our platform as our customers
          grow their businesses, adoption of additional product offerings and
          targeted sales initiatives focused on our larger customers. Our
          consumption-based pricing model makes it frictionless for customers to
          increase their usage of our platform as they require more compute and
          storage as they grow and scale. We have also expanded the breadth of
          our platform offerings and will continue to do so as we have
          experienced strong adoption of recently developed products. To
          accelerate this growth across our larger customers, we have recently
          complemented our self-service marketing model with internal
          go-to-market teams that are specifically focused on expanding our
          business with our larger customers. Our ability to increase the usage
          of our platform by existing customers will depend on a number of
          factors, including our customers’ satisfaction with our platform and
          product offerings, competition, pricing and overall changes in our
          customers’ spending levels.
       
          Enhancing Our Platform and Product Offerings
       
          We believe the market opportunity for serving developers, start-ups
          and SMBs is very large and goes far beyond providing the core IaaS
          services of compute, storage and networking. We have a history of, and
          will continue to invest significantly in, developing and delivering
          innovative products, features and functionality targeted at our core
          customer base. For example, our Managed Kubernetes and Managed
          Database offerings, which were launched in late 2018 and 2019,
          respectively, contributed approximately $4.8 million and $19.8 million
          of revenue in 2019 and 2020, respectively, and we expect revenue from
          these offerings to continue to grow. In addition, while we have not
          been focused on acquisition opportunities to drive our growth, we may
          pursue both strategic partnerships and acquisitions that we believe
          will be complementary to our business, accelerate customer
          acquisition, increase usage of our platform and/or expand our product
          offerings in our core markets. Our results of operations may fluctuate
          as we make these investments to drive usage and take advantage of our
          expansive market opportunity.
       
          Key Business Metrics
       
          We utilize the key metrics set forth below to help us evaluate our
          business and growth, identify trends, formulate financial projections
          and make strategic decisions. We are not aware of any uniform
          standards for
       
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          calculating these key metrics, and other companies may not calculate
          similarly titled metrics in a consistent manner, which may hinder
          comparability.
       
          Year Ended December 31,
       
          2018
       
          2019
       
          2020
       
          Customers
       
          501,649
       
          542,708
       
          572,960
       
          ARPU
       
          $
       
          35.97
       
          $
       
          40.16
       
          $
       
          47.78
       
          ARR (in millions)
       
          $
       
          226
       
          $
       
          285
       
          $
       
          357
       
          Net dollar retention rate
       
          101%
       
          100%
       
          103%
       
          Capital expenditures as a percentage of revenue
       
          57%
       
          37%
       
          38%
       
          Customers
       
          We believe that the number of customers is an important indicator of
          the growth of our business and future revenue opportunity. We define a
          customer at the end of any period as a person or entity who has
          incurred usage in the period and, as a result, has generated an
          invoice of greater than $0 for that period. We treat each customer
          that generates an invoice as a unique customer, and a single
          organization with multiple divisions, segments or subsidiaries may be
          counted as multiple customers if they separately signed up on our
          platform. During 2019 and 2020, our number of customers increased by
          approximately 41,000 and 30,000, respectively, with approximately
          573,000 customers as of December 31, 2020.
       
          ARPU
       
          We believe that our average revenue per customer, which we refer to as
          ARPU, is a strong indication of our ability to land new customers with
          higher spending levels and expand usage of our platform by our
          existing customers. We calculate ARPU on a monthly basis as our total
          revenue in that period divided by the number of customers determined
          as of the last day of that period. For a quarterly or annual period,
          ARPU is determined as the weighted average monthly ARPU over such
          three or 12-month period. Our ARPU has increased significantly, from
          $35.97 in 2018 to $40.16 in 2019 to $47.78 in 2020.
       
          ARR
       
          Given the renewable nature of our business, we view annual run-rate
          revenue as an important indicator of our current progress towards
          meeting our revenue targets and projected growth rate going forward.
          We calculate ARR at a point in time by multiplying the latest monthly
          period’s revenue by 12. ARR grew by 26% from December 31, 2018 to
          December 31, 2019 and 25% from December 31, 2019 to December 31, 2020.
       
          Net Dollar Retention Rate
       
          Our ability to maintain long-term revenue growth and achieve
          profitability is dependent on our ability to retain and grow revenue
          from our existing customers. We have a history of retaining customers
          for multiple years and in many cases increasing their spend with us
          over time. To help us measure our performance in this area, we monitor
          our net dollar retention rate. We calculate net dollar retention rate
          monthly by starting with the revenue from the cohort of all customers
          during the corresponding month 12 months prior, or the Prior Period
          Revenue. We then calculate the revenue from these same customers as of
          the current month, or the Current Period Revenue, including any
          expansion and net of any contraction or attrition from these customers
          over the last 12 months. The calculation also includes revenue from
          customers that generated revenue before, but not in, the corresponding
          month 12 months prior, but subsequently generated revenue in the
          current month and are therefore reflected in the Current Period
          Revenue. We include this group of re-engaged customers in this
          calculation because our customers frequently use our platform for
          projects that stop and start over time. We then divide the total
          Current Period Revenue by the total Prior Period Revenue to arrive at
          the net dollar retention rate for the relevant month. For a quarterly
          or annual period, the net dollar retention rate is determined as the
          average monthly net dollar retention rates over such three or 12-month
          period. Our net dollar retention rate for 2018, 2019 and 2020 was
          101%, 100% and 103%, respectively, which includes approximately 3%
          from re-engaged customers in each of 2018, 2019 and 2020.
       
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          In addition to net dollar retention rate, we monitor gross dollar
          retention rate as a measure of the churn of existing customers. We
          calculate gross dollar retention rate in the same manner we calculate
          net dollar retention rate, but without including the impact of
          expansion and contraction from the relevant customers (i.e., our gross
          dollar retention rate reflects only customer losses and does not
          reflect customer expansion or contraction). Our gross dollar retention
          rate for each of 2018, 2019 and 2020 was 86%, demonstrating the low
          churn of our customer base.
       
          Capital Expenditures as a Percentage of Revenue
       
          We consider capital expenditures as a percentage of revenue to be an
          important indicator of our efficiency of capital spend. We calculate
          capital expenditures as a percentage of revenue by dividing total
          capital expenditures during the period, including purchases of
          intangible assets, seller financed equipment purchases and acquisition
          of property and equipment from capital leases, by revenue. For 2018,
          2019 and 2020, capital expenditures as a percentage of revenue was
          57%, 37% and 38%, respectively. We expect our capital expenditures as
          a percentage of revenue to continue to decline over the next several
          years.
       
          Components of Results of Operations
       
          Revenue
       
          We provide cloud computing services, including but not limited to
          compute, storage and networking, to our customers. We recognize
          revenue based on the customer utilization of these resources. Customer
          contracts are primarily month-to-month and do not include any minimum
          guaranteed quantities or fees. Fees are billed monthly, and payment is
          typically due upon invoicing. Revenue is recognized net of allowances
          for credits and any taxes collected from customers, which are
          subsequently remitted to governmental authorities.
       
          We may offer sales incentives in the form of promotional and referral
          credits and grant credits to encourage customers to use our services.
          These types of promotional and referral credits typically expire in
          two months or less if not used. For credits earned with a purchase,
          they are recorded as contract liabilities when earned and recognized
          at the earlier of redemption or expiration. The majority of credits
          are redeemed in the month they are earned.
       
          Cost of Revenue
       
          Cost of revenue consists primarily of fees related to operating in
          third-party co-location facilities, personnel expenses for those
          directly supporting our data centers and non-personnel costs,
          including amortization of capitalized internal-use software
          development costs and depreciation of our data center equipment.
          Third-party co-location facility costs include data center rental
          fees, power costs, maintenance fees, and network and bandwidth
          expenses. Personnel expenses include salaries, bonuses, benefits, and
          stock-based compensation.
       
          We intend to continue to invest additional resources in our
          infrastructure to support our product portfolio and scalability of our
          customer base. The level, timing and relative investment in our
          infrastructure could affect our cost of revenue in the future.
       
          Operating Expenses
       
          Research and Development Expenses
       
          Research and development expenses consist primarily of personnel costs
          including salaries, bonuses, benefits and stock-based compensation.
          Research and development expenses also include amortization of
          capitalized internal-use software development costs for research and
          development activities, which are amortized over three years, and
          professional services, as well as costs related to our efforts to add
          new features to our existing offerings, develop new offerings, and
          ensure the security, performance, and reliability of our global cloud
          platform. We expect research and development expenses to increase in
          absolute dollars as we continue to invest in our platform and product
          offerings.
       
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          Sales and Marketing Expenses
       
          Sales and marketing expenses consist primarily of personnel costs of
          our sales, marketing and customer support employees including
          salaries, bonuses, benefits and stock-based compensation. Sales and
          marketing expenses also include costs for marketing programs,
          advertising, and professional service fees. We expect sales and
          marketing expenses to continue to increase in absolute dollars as we
          enhance our product offerings and implement new marketing strategies.
       
          General and Administrative Expenses
       
          General and administrative expenses consist primarily of personnel
          costs of our human resources, legal, finance, and other administrative
          functions including salaries, bonuses, benefits and stock-based
          compensation. General and administrative expenses also include bad
          debt expense, software, payment processing fees, depreciation and
          amortization expenses, rent and facilities costs, and other
          administrative costs. We expect to incur significant additional legal,
          accounting and other expenses to support our transition to and
          operations as a public company, including costs associated with our
          compliance with the Sarbanes-Oxley Act. We also expect general and
          administrative expenses to increase in absolute dollars as we continue
          to grow our business.
       
          Other (Income) Expense
       
          Other (income) expense consists primarily of interest expense on our
          credit facility and third-party equipment financing, loss on
          extinguishment of debt, and gains or losses on foreign currency
          exchange.
       
          Income Tax Expense
       
          Income tax expense consists primarily of income taxes in certain
          foreign and state jurisdictions in which we conduct business. We
          maintain a full valuation allowance on our U.S. federal and state
          deferred tax assets as we have concluded that it is more likely than
          not that the deferred assets will not be realized.
       
          Results of Operations
       
          The following table sets forth our results of operations for the
          periods presented:
       
          Year Ended December 31,
       
          2018
       
          2019
       
          2020
       
          (in thousands)
       
          Revenue
       
          $
       
          203,136
       
          $
       
          254,823
       
          $
       
          318,380
       
          Cost of revenue(1)
       
          97,042
       
          122,259
       
          145,532
       
          Gross profit
       
          106,094
       
          132,564
       
          172,848
       
          Operating expenses:
       
          Research and development(1)
       
          44,934
       
          59,973
       
          74,970
       
          Sales and marketing(1)
       
          29,445
       
          31,340
       
          33,472
       
          General and administrative(1)
       
          59,009
       
          71,156
       
          80,197
       
          Total operating expenses
       
          133,388
       
          162,469
       
          188,639
       
          Loss from operations
       
          (27,294
       
          ) 
       
          (29,905
       
          ) 
       
          (15,791
       
          ) 
       
          Other (income) expense
       
          7,484
       
          9,692
       
          26,866
       
          Loss before income taxes
       
          (34,778
       
          ) 
       
          (39,597
       
          ) 
       
          (42,657
       
          ) 
       
          Income tax expense
       
          1,221
       
          793
       
          911
       
          Net loss attributable to common stockholders
       
          $
       
          (35,999
       
          ) 
       
          $
       
          (40,390
       
          ) 
       
          $
       
          (43,568
       
          ) 
       
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          (1)
       
          Includes stock-based compensation as follows:
       
          Year Ended December 31,
       
                2018      
       
                2019      
       
                2020      
       
          (in thousands)
       
          Cost of revenue
       
          $
       
          42
       
          $
       
          1,142
       
          $
       
          545
       
          Research and development
       
          2,559
       
          4,688
       
          7,765
       
          Sales and marketing
       
          381
       
          539
       
          1,924
       
          General and administrative
       
          9,185
       
          12,277
       
          19,222
       
          Total
       
          $
       
          12,167
       
          $
       
          18,646
       
          $
       
          29,456
       
          Stock-based compensation for the years ended December 31, 2018, 2019
          and 2020 included compensation of $8.0 million, $12.1 million and
          $18.3 million, respectively, related to secondary sales of common
          stock by certain current and former employees, which is primarily
          included in General and administrative. See “Comparison of Years Ended
          December 31, 2019 and 2020—Operating Expenses” and “Comparison of
          Years Ended December 31, 2018 and 2019—Operating Expenses” below.
       
          The following table sets forth our results of operations as a
          percentage of revenue for the periods presented:
       
          Year Ended December 31,
       
          2018
       
          2019
       
          2020
       
          Revenue
       
          100
       
          % 
       
          100
       
          % 
       
          100
       
          % 
       
          Cost of revenue
       
          48
       
          48
       
          46
       
          Gross profit
       
          52
       
          52
       
          54
       
          Operating expenses:
       
          Research and development
       
          22
       
          24
       
          24
       
          Sales and marketing
       
          14
       
          12
       
          11
       
          General and administrative
       
          29
       
          28
       
          25
       
          Total operating expenses
       
          65
       
          64
       
          60
       
          Loss from operations
       
          (13
       
          ) 
       
          (12
       
          ) 
       
          (6
       
          ) 
       
          Other (income) expense
       
          4
       
          4
       
          8
       
          Loss before income taxes
       
          (17
       
          ) 
       
          (16
       
          ) 
       
          (14
       
          ) 
       
          Income tax expense
       
          1
       
          *
       
          *
       
          Net loss attributable to common stockholders
       
          (18
       
          )% 
       
          (16
       
          )% 
       
          (14
       
          )% 
       
          *
       
          Less than 1% of revenue
       
          Comparison of Years Ended December 31, 2019 and 2020
       
          Revenue
       
          Year Ended December 31,
       
                2019      
       
                2020      
       
          $ Change
       
          % Change
       
          (in thousands)
       
          Revenue
       
          $
       
          254,823
       
          $
       
          318,380
       
          $
       
          63,557
       
          25
       
          % 
       
          Revenue increased $63.6 million, or 25%, for the year ended
          December 31, 2020 compared to the year ended December 31, 2019,
          primarily due to a 19% increase in ARPU to $47.78 from $40.16 and an
          increase of approximately 30,000 customers to approximately 573,000.
          The increase in ARPU was primarily driven by a $15.0 million increase
          in revenue from new products, and the increase in customers was driven
          by continued strong customer acquisition and retention.
       
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          Cost of Revenue
       
          Year Ended December 31,
       
                2019      
       
                2020      
       
          $ Change
       
          % Change
       
          (in thousands)
       
          Cost of revenue
       
          $
       
          122,259
       
          $
       
          145,532
       
          $
       
          23,273
       
          19
       
          % 
       
          Cost of revenue increased $23.3 million, or 19%, for the year ended
          December 31, 2020 as compared to the year ended December 31, 2019,
          primarily due to higher co-location costs, bandwidth expenses and
          depreciation of our network equipment to support the growth in our
          business, as well as additional ancillary data center equipment needs.
       
          Operating Expenses
       
          Year Ended December 31,
       
                2019      
       
                2020      
       
          $ Change
       
          % Change
       
          (in thousands)
       
          Research and development
       
          $
       
          59,973
       
          $
       
          74,970
       
          $
       
          14,997
       
          25
       
          % 
       
          Sales and marketing
       
          31,340
       
          33,472
       
          2,132
       
          7
       
          % 
       
          General and administrative
       
          71,156
       
          80,197
       
          9,041
       
          13
       
          % 
       
          Total operating expenses
       
          $
       
          162,469
       
          $
       
          188,639
       
          $
       
          26,170
       
          16
       
          % 
       
          Research and development expenses increased $15.0 million, or 25%, for
          the year ended December 31, 2020 as compared to the year ended
          December 31, 2019, primarily due to an increase in personnel costs to
          support our growing operations, as well as stock-based compensation
          including secondary sales of our common stock.
       
          Sales and marketing expenses increased $2.1 million, or 7%, for the
          year ended December 31, 2020 as compared to the year ended
          December 31, 2019, primarily due to an increase in personnel costs to
          support our growing operations, partially offset by a decrease in
          advertising and other promotional costs.
       
          General and administrative expenses increased $9.0 million, or 13%,
          for the year ended December 31, 2020 as compared to the year ended
          December 31, 2019, primarily due to stock-based compensation including
          secondary sales of our common stock, an increase in personnel costs to
          support our growing operations and an increase in software expenses,
          partially offset by a decrease in travel and entertainment as a result
          of the COVID-19 pandemic.
       
          Other (Income) Expense
       
          Year Ended December 31,
       
                2019      
       
                2020      
       
          $ Change
       
          % Change
       
          (in thousands)
       
          Other (income) expense
       
          $
       
          9,692
       
          $
       
          26,866
       
          $
       
          17,174
       
          177
       
          % 
       
          Other (income) expense increased $17.2 million, or 177%, for the year
          ended December 31, 2020 as compared to the year ended December 31,
          2019, primarily due to an increase in interest expense as a result of
          increased borrowings under our existing credit facility and a
          $12.8 million unrealized loss on the revaluation of warrants.
       
          Income Tax Expense
       
          Year Ended December 31,
       
                2019      
       
                2020      
       
          $ Change
       
          % Change
       
          (in thousands)
       
          Income tax expense
       
          $
       
          793
       
          $
       
          911
       
          $
       
          118
       
          15
       
          % 
       
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          Income tax expense increased $0.1 million, or 15%, for the year ended
          December 31, 2020 as compared to the year ended December 31, 2019,
          primarily due to unrecognized tax positions. As of December 31, 2020,
          we had federal net operating loss carryforwards and state net
          operating loss carryforwards of $103.2 million and $128.1 million,
          respectively.
       
          Comparison of Years Ended December 31, 2018 and 2019
       
          Revenue
       
          Year Ended December 31,
       
                2018      
       
                2019      
       
          $ Change
       
          % Change
       
          (in thousands)
       
          Revenue
       
          $
       
          203,136
       
          $
       
          254,823
       
          $
       
          51,687
       
          25
       
          % 
       
          Revenue increased $51.7 million, or 25%, for the year ended
          December 31, 2019 compared to the year ended December 31, 2018,
          primarily due to a 12% increase in ARPU to $40.16 from $35.97 and an
          increase of approximately 41,000 customers to approximately 543,000.
          The increase in ARPU was primarily driven by a $4.8 million increase
          in revenue from new products, and the increase in customers was driven
          by continued strong customer acquisition and retention.
       
          Cost of Revenue
       
          Year Ended December 31,
       
                2018      
       
                2019      
       
          $ Change
       
          % Change
       
          (in thousands)
       
          Cost of revenue
       
          $
       
          97,042
       
          $
       
          122,259
       
          $
       
          25,217
       
          26
       
          % 
       
          Cost of revenue increased $25.2 million, or 26%, for the year ended
          December 31, 2019 as compared to the year ended December 31, 2018,
          primarily due to higher co-location costs, bandwidth expenses and
          depreciation of our network equipment to support the growth in our
          business, as well as additional ancillary data center equipment needs.
       
          Operating Expenses
       
          Year Ended December 31,
       
                2018      
       
                2019      
       
          $ Change
       
          % Change
       
          (in thousands)
       
          Research and development
       
          $
       
          44,934
       
          $
       
          59,973
       
          $
       
          15,039
       
          33
       
          % 
       
          Sales and marketing
       
          29,445
       
          31,340
       
          1,895
       
          6
       
          % 
       
          General and administrative
       
          59,009
       
          71,156
       
          12,147
       
          21
       
          % 
       
          Total operating expenses
       
          $
       
          133,388
       
          $
       
          162,469
       
          $
       
          29,081
       
          22
       
          % 
       
          Research and development expenses increased $15.0 million, or 33%, for
          the year ended December 31, 2019 as compared to the year ended
          December 31, 2018, primarily due to an increase in personnel costs to
          support our growing operations, as well as stock-based compensation
          including secondary sales of our common stock.
       
          Sales and marketing expenses increased $1.9 million, or 6%, for the
          year ended December 31, 2019 as compared to the year ended
          December 31, 2018, primarily due to an increase in personnel costs to
          support our growing operations, partially offset by a decrease in
          advertising and other promotional costs.
       
          General and administrative expenses increased $12.1 million, or 21%,
          for the year ended December 31, 2019 as compared to the year ended
          December 31, 2018, primarily due to an increase in personnel costs to
          support our growing operations, stock-based compensation including
          secondary sales of our common stock and an increase in software
          expenses and project-based professional service fees.
       
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          Other (Income) Expense
       
          Year Ended December 31,
       
                2018      
       
                2019      
       
          $ Change
       
          % Change
       
          (in thousands)
       
          Other (income) expense
       
          $
       
          7,484
       
          $
       
          9,692
       
          $
       
          2,208
       
          30
       
          % 
       
          Other (income) expense increased $2.2 million, or 30%, for the year
          ended December 31, 2019 as compared to the year ended December 31,
          2018, primarily due to an increase in interest expense as a result of
          increased borrowings under our existing credit facility and increased
          capital expenditure financing.
       
          Income Tax Expense
       
          Year Ended December 31,
       
                2018      
       
                2019      
       
          $ Change
       
          % Change
       
          (in thousands)
       
          Income tax expense
       
          $
       
          1,221
       
          $
       
          793
       
          $
       
          (428
       
          ) 
       
          (35
       
          )% 
       
          Income tax expense decreased $0.4 million, or 35%, for the year ended
          December 31, 2019 as compared to the year ended December 31, 2018,
          primarily due to unrecognized tax positions. As of December 31, 2019,
          we had federal net operating loss carryforwards and state net
          operating loss carryforwards of $91.8 million and $92.8 million,
          respectively.
       
          Quarterly Results of Operations
       
          The following tables summarize our selected unaudited quarterly
          consolidated statements of operations data for each of the eight
          fiscal quarters in the period ended December 31, 2020, as well as the
          percentage of revenues that each line item represents for each
          quarter. The information for each of these quarters has been prepared
          in accordance with GAAP on the same basis as our audited annual
          consolidated financial statements included elsewhere in this
          prospectus and reflects, in the opinion of management, all adjustments
          of a normal, recurring nature that are necessary for the fair
          statement of the results of operations for these periods. This data
          should be read in conjunction with our audited consolidated financial
          statements included elsewhere in this prospectus. Our historical
          results are not necessarily indicative of the results that may be
          expected in the future.
       
          Three Months Ended
       
          March 31,
          2019
       
          June 30,
          2019
       
          September 30,
          2019
       
          December 31,
          2019
       
          March 31,
          2020
       
          June 30,
          2020
       
          September 30,
          2020
       
          December 31,
          2020
       
          (in thousands)
       
          Revenue
       
          $
       
          58,294
       
          $
       
          61,931
       
          $
       
          65,299
       
          $
       
          69,299
       
          $
       
          72,792
       
          $
       
          76,911
       
          $
       
          81,160
       
          $
       
          87,517
       
          Cost of revenue(1)
       
          28,462
       
          29,860
       
          30,900
       
          33,037
       
          34,683
       
          35,205
       
          37,063
       
          38,581
       
          Gross profit
       
          29,832
       
          32,071
       
          34,399
       
          36,262
       
          38,109
       
          41,706
       
          44,097
       
          48,936
       
          Operating expenses:
       
          Research and development(1)
       
          13,515
       
          14,566
       
          16,633
       
          15,259
       
          19,477
       
          15,130
       
          19,706
       
          20,657
       
          Sales and marketing(1)
       
          7,110
       
          7,861
       
          7,566
       
          8,803
       
          9,454
       
          6,957
       
          7,700
       
          9,361
       
          General and administrative(1)
       
          18,810
       
          16,031
       
          17,860
       
          18,455
       
          21,665
       
          17,841
       
          23,411
       
          17,280
       
          Total operating expenses
       
          39,435
       
          38,458
       
          42,059
       
          42,517
       
          50,596
       
          39,928
       
          50,817
       
          47,298
       
          (Loss) income from operations
       
          (9,603
       
          ) 
       
          (6,387
       
          ) 
       
          (7,660
       
          ) 
       
          (6,255
       
          ) 
       
          (12,487
       
          ) 
       
          1,778
       
          (6,720
       
          ) 
       
          1,638
       
          Other (income) expense
       
          1,801
       
          2,146
       
          2,738
       
          3,007
       
          3,698
       
          4,097
       
          3,628
       
          15,443
       
          Loss before income taxes
       
          (11,404
       
          ) 
       
          (8,533
       
          ) 
       
          (10,398
       
          ) 
       
          (9,262
       
          ) 
       
          (16,185
       
          ) 
       
          (2,319
       
          ) 
       
          (10,348
       
          ) 
       
          (13,805
       
          ) 
       
          Income tax expense (benefit)
       
          134
       
          127
       
          162
       
          370
       
          748
       
          251
       
          (134
       
          ) 
       
          46
       
          Net loss attributable to common stockholders
       
          $
       
          (11,538
       
          ) 
       
          $
       
          (8,660
       
          ) 
       
          $
       
          (10,560
       
          ) 
       
          $
       
          (9,632
       
          ) 
       
          $
       
          (16,933
       
          ) 
       
          $
       
          (2,570
       
          ) 
       
          $
       
          (10,214
       
          ) 
       
          $
       
          (13,851
       
          ) 
       
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          Table of Contents
       
          (1)
       
          Includes stock-based compensation as follows:
       
          Three Months Ended
       
          March 31,
          2019
       
          June 30,
          2019
       
          September 30,
          2019
       
          December 31,
          2019
       
          March 31,
          2020
       
          June 30,
          2020
       
          September 30,
          2020
       
          December 31,
          2020
       
          (in thousands)
       
          Cost of revenue
       
          $
       
          15
       
          $
       
          14
       
          $
       
          594
       
          $
       
          519
       
          $
       
          24
       
          $
       
          68
       
          $
       
          302
       
          $
       
          151
       
          Research and development
       
          750
       
          754
       
          2,336
       
          848
       
          2,221
       
          812
       
          2,950
       
          1,782
       
          Sales and marketing
       
          97
       
          202
       
          137
       
          103
       
          226
       
          453
       
          470
       
          775
       
          General and administrative
       
          5,577
       
          1,196
       
          2,788
       
          2,716
       
          6,911
       
          1,424
       
          9,004
       
          1,883
       
          Total
       
          $
       
          6,439
       
          $
       
          2,166
       
          $
       
          5,855
       
          $
       
          4,186
       
          $
       
          9,382
       
          $
       
          2,757
       
          $
       
          12,726
       
          $
       
          4,591
       
          Stock-based compensation included compensation related to secondary
          sales of common stock by certain current and former employees as
          follows:
       
          Three Months Ended
       
          March 31,
          2019
       
          June 30,
          2019
       
          September 30,
          2019
       
          December 31,
          2019
       
          March 31,
          2020
       
          June 30,
          2020
       
          September 30,
          2020
       
          December 31,
          2020
       
          (in thousands)
       
          Secondary sales
       
          $
       
          5,144
       
          $
       
          643
       
          $
       
          4,021
       
          $
       
          2,248
       
          $
       
          7,611
       
          $
       
          529
       
          $
       
          10,203
       
          $
       
            –
       
          Percentage of Revenue Data
       
          Three Months Ended
       
          March 31,
          2019
       
          June 30,
          2019
       
          September 30,
          2019
       
          December 31,
          2019
       
          March 31,
          2020
       
          June 30,
          2020
       
          September 30,
          2020
       
          December 31,
          2020
       
          Revenue
       
          100
       
          % 
       
          100
       
          % 
       
          100
       
          % 
       
          100
       
          % 
       
          100
       
          % 
       
          100
       
          % 
       
          100
       
          % 
       
          100
       
          % 
       
          Cost of revenue
       
          49
       
          48
       
          47
       
          48
       
          48
       
          46
       
          46
       
          44
       
          Gross profit
       
          51
       
          52
       
          53
       
          52
       
          52
       
          54
       
          54
       
          56
       
          Operating expenses:
       
          Research and development
       
          23
       
          24
       
          25
       
          22
       
          27
       
          20
       
          24
       
          24
       
          Sales and marketing
       
          12
       
          13
       
          12
       
          13
       
          13
       
          9
       
          9
       
          11
       
          General and administrative
       
          32
       
          26
       
          27
       
          27
       
          30
       
          23
       
          29
       
          20
       
          Total operating expenses
       
          67
       
          63
       
          64
       
          62
       
          70
       
          52
       
          62
       
          55
       
          (Loss) income from operations
       
          (16
       
          ) 
       
          (11
       
          ) 
       
          (11
       
          ) 
       
          (10
       
          ) 
       
          (18
       
          ) 
       
          2
       
          (8
       
          ) 
       
          1
       
          Other (income) expense
       
          3
       
          3
       
          4
       
          4
       
          5
       
          5
       
          4
       
          18
       
          Loss before income taxes
       
          (19
       
          ) 
       
          (14
       
          ) 
       
          (15
       
          ) 
       
          (14
       
          ) 
       
          (23
       
          ) 
       
          (3
       
          ) 
       
          (12
       
          ) 
       
          (17
       
          ) 
       
          Income tax expense (benefit)
       
          *
       
          *
       
          *
       
          *
       
          *
       
          *
       
          *
       
          *
       
          Net loss attributable to common stockholders
       
          (19
       
          )% 
       
          (14
       
          )% 
       
          (15
       
          )% 
       
          (14
       
          )% 
       
          (23
       
          )% 
       
          (3
       
          )% 
       
          (12
       
          )% 
       
          (17
       
          )% 
       
          *
       
          Less than 1% of revenue
       
          Key Business Metrics(1)
       
          Three Months Ended
       
          March 31,
          2019
       
          June 30,
          2019
       
          September 30,
          2019
       
          December 31,
          2019
       
          March 31,
          2020
       
          June 30,
          2020
       
          September 30,
          2020
       
          December 31,
          2020
       
          Customers
       
          519,079
       
          531,272
       
          536,809
       
          542,708
       
          546,453
       
          554,236
       
          559,310
       
          572,960
       
          ARPU
       
          $
       
          37.87
       
          $
       
          39.26
       
          $
       
          40.56
       
          $
       
          42.83
       
          $
       
          44.68
       
          $
       
          46.44
       
          $
       
          48.58
       
          $
       
          51.25
       
          ARR (in millions)
       
          $
       
          237
       
          $
       
          252
       
          $
       
          265
       
          $
       
          285
       
          $
       
          299
       
          $
       
          313
       
          $
       
          335
       
          $
       
          357
       
          Net dollar retention rate
       
          100
       
          % 
       
          101
       
          % 
       
          100
       
          % 
       
          100
       
          % 
       
          101
       
          % 
       
          102
       
          % 
       
          104
       
          % 
       
          105
       
          % 
       
          Capital expenditures as a percentage of revenue
       
          32
       
          % 
       
          49
       
          % 
       
          29
       
          % 
       
          39
       
          % 
       
          44
       
          % 
       
          40
       
          % 
       
          32
       
          % 
       
          35
       
          % 
       
          (1)
       
          See “Management’s Discussion and Analysis of Financial Condition and
          Results of Operations—Key Business Metrics” for our definitions of
          these metrics.
       
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          Quarterly Trends
       
          Our quarterly revenue increased in each of the quarters presented
          primarily due to increases in sales to new and existing customers as
          well as a steady increase in ARPU. Cost of revenue increased in each
          of the quarters presented due to an increase in our number of
          customers and related costs to support our growing data center
          operations at our co-location facilities, network and bandwidth costs,
          and other related overhead costs for operating our global platform.
          Operating expenses increased during 2019 and 2020 primarily due to
          increases in headcount and other related expenses to support our
          growing customer base and operations. Quarterly fluctuations in our
          Operating expenses, especially in General and administrative, were
          primarily due to stock-based compensation related to the timing of
          secondary sales of common stock by certain current and former
          employees, which is shown above and also described in Note 14 to our
          consolidated financial statements included elsewhere in this
          prospectus.
       
          Our quarterly growth in number of customers, ARPU and ARR for each of
          the quarters presented reflects the overall progress with our
          go-to-market programs, our ability to attract customers with higher
          spending levels and our existing customers continuing to expand their
          business with us. The increase in our net dollar retention rate during
          2020 highlights the success we are having with new initiatives to
          retain existing customers and expand sales with such customers,
          including through increased adoption of our new products.
       
          Capital expenditures as a percentage of revenue declined from 57% in
          2018 to 37% in 2019 and 38% in 2020 as we reduced the acquisition cost
          of hardware and increased the efficiency of those assets. Capital
          expenditures as a percentage of revenue remained relatively flat on an
          annual basis between 2019 and 2020 as we accelerated the acquisition
          of certain hardware originally scheduled for purchase in 2021 into
          2020. We experience quarterly fluctuations in this metric, which
          ranged from 29% to 49% in 2019 and 2020, because it is dependent on
          the specific timing of our purchases. These quarterly fluctuations
          have not impacted the overall annual trend line, which is our primary
          management focus. We anticipate a continued reduction in capital
          expenditures as a percentage of revenue, as measured on an annual
          basis, over the next several years.
       
          Liquidity and Capital Resources
       
          We have funded our operations since inception primarily with cash flow
          generated by operations, private offerings of our securities,
          borrowings under our credit facilities and capital expenditure
          financings. As of December 31, 2020, we had $100.3 million of cash and
          cash equivalents. In May 2020, we completed our Series C preferred
          stock offering, resulting in net proceeds of $49.8 million. We believe
          our existing cash and cash equivalents, cash flow from operations and
          availability under our 2020 Credit Facility (as described below) will
          be sufficient to support working capital and capital expenditure
          requirements for at least the next 12 months.
       
          In February and March 2020, we entered into and subsequently amended a
          second amended and restated credit agreement, or our 2020 Credit
          Facility, with KeyBank National Association as administrative agent.
          Our 2020 Credit Facility has total draw down capacity of $320 million,
          with a $150 million revolver, or the Revolving Credit Facility, and a
          $170 million term loan. Our 2020 Credit Facility will mature on
          February 13, 2025. The borrowings from the 2020 Credit Facility were
          used to repay our amended and restated credit agreement entered into
          with KeyBank National Association as administrative agent in April
          2018, or our 2018 Credit Facility, in its entirety. We drew down
          $63.2 million under the Revolving Credit Facility, $8.2 million of
          which was used to repay the 2018 revolving credit facility with the
          remainder used for working capital purposes as well as to strengthen
          our cash position and maintain flexibility given the uncertainty in
          the global economy as a result of the COVID-19 pandemic. As of
          December 31, 2020, our total available borrowing capacity under our
          Revolving Credit Facility was $86.8 million.
       
          Our 2020 Credit Facility is secured by a first-priority security
          interest in substantially all of our assets. Our 2020 Credit Facility
          contains certain financial and operational covenants, including a
          maximum ratio of consolidated total debt to consolidated EBITDA of
          4.50x with step-downs over time and a maximum debt service coverage
          ratio of 3.00x. Consolidated total debt and consolidated EBITDA, which
          are non-GAAP measures used for this covenant, are calculated in
          accordance with the definitions set forth in the 2020 Credit Facility.
          In this
       
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          context, these measures are used solely to provide information on the
          extent to which we are in compliance with these financial covenants
          and may not be comparable to consolidated total debt and consolidated
          EBITDA used by other companies or any other non-GAAP measures we
          present elsewhere in this prospectus. We were in compliance with all
          covenants under our 2020 Credit Facility as of December 31, 2020.
       
          The following table summarizes our cash flows for the periods
          presented:
       
          December 31,
       
          2018
       
          2019
       
          2020
       
          (in thousands)
       
          Net cash provided by operating activities
       
          $
       
          37,954
       
          $
       
          39,902
       
          $
       
          58,115
       
          Net cash used in investing activities
       
          (61,254
       
          ) 
       
          (87,383
       
          ) 
       
          (115,490
       
          ) 
       
          Net cash (used in) provided by financing activities
       
          (14,248
       
          ) 
       
          49,804
       
          124,026
       
          Net (decrease) increase in cash and cash equivalents
       
          (37,548
       
          ) 
       
          2,323
       
          66,651
       
          Operating Activities
       
          Our largest source of operating cash is cash collections from sales to
          our customers. Our primary uses of cash from operating activities are
          for personnel expenses, data center co-location expenses, marketing
          expenses, payment processing fees, bandwidth and connectivity, server
          maintenance and software licensing fees. We have generated negative
          cash flows and have supplemented working capital requirements through
          net proceeds from borrowings under our credit facilities and private
          offerings of our securities.
       
          Net cash provided by operating activities was $38.0 million,
          $39.9 million and $58.1 million for the years ended December 31, 2018,
          2019 and 2020, respectively, primarily driven by an increase in cash
          collections from higher revenues offset by an increase in cash
          expenses from personnel related costs and higher interest payments.
       
          Investing Activities
       
          Net cash used in investing activities was $61.3 million, $87.4 million
          and $115.5 million for the years ended December 31, 2018, 2019 and
          2020, respectively, primarily as a result of increases in capital
          expenditures to purchase property and equipment to support additional
          data center co-locations, capitalization of internal-use software
          development costs and acquired intangibles related to our IP
          addresses.
       
          Financing Activities
       
          Net cash used in financing activities of $14.2 million for the year
          ended December 31, 2018 was primarily due to repayments of financed
          equipment purchases of $36.0 million, partially offset by net proceeds
          from borrowings under the 2018 revolving credit facility of
          $25.0 million. Additionally, the proceeds from the 2018 Credit
          Facility were used to repay a previous credit facility.
       
          Net cash provided by financing activities of $49.8 million for the
          year ended December 31, 2019 was primarily due to $59.5 million in
          borrowings under the 2018 revolving credit facility and $11.5 million
          of proceeds from third-party equipment financings, partially offset by
          $22.8 million in repayment of notes payable associated with financed
          equipment purchases.
       
          Net cash provided by financing activities of $124.0 million for the
          year ended December 31, 2020 was primarily due to $75.2 million in net
          proceeds from borrowings under the 2020 Credit Facility, the proceeds
          of which were used to repay the 2018 Credit Facility, $49.8 million
          from our Series C preferred stock offering, and $14.0 million of
          proceeds from the issuance of common stock under our stock plan,
          partially offset by $17.9 million in repayment of notes payable and
          capital leases associated with financed equipment purchases.
       
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          Contractual Obligations and Commitments
       
          The following table summarizes our contractual obligations as of
          December 31, 2020:
       
          Payments Due By Period
       
          Total
       
          Less than 1
          Year
       
          1-3 Years
       
          3-5 Years
       
          (in thousands)
       
          Long-term debt obligations(1)
       
          $
       
          293,868
       
          $
       
          26,713
       
          $
       
          57,883
       
          $
       
          209,272
       
          Operating lease commitments(2)
       
          115,473
       
          43,605
       
          48,624
       
          23,244
       
          Purchase obligations(3)
       
          22,265
       
          9,530
       
          6,954
       
          5,781
       
          Total
       
          $
       
          431,606
       
          $
       
          79,848
       
          $
       
          113,461
       
          $
       
          238,297
       
          (1)
       
          Includes principal, interest and unused commitment fees on our 2020
          Credit Facility and notes payable. The rate assumed for the variable
          interest component of the contractual interest obligation was the rate
          in effect at December 31, 2020. See Note 5 to the Consolidated
          Financial Statements included elsewhere in this prospectus for a
          further discussion of our Long-term debt.
       
          (2)
       
          Includes operating lease liabilities for certain of our offices and
          our data centers.
       
          (3)
       
          Includes long-term commitments for bandwidth usage with various
          networks and internet service providers and purchase orders with
          various vendors. Additionally, amounts include minimum purchase
          agreements for certain equipment purchases which we finance with
          various sellers and/or third parties.
       
          The commitment amounts in the table above are associated with
          contracts that are enforceable and legally binding and that specify
          all significant terms, including fixed or minimum services to be used,
          fixed, minimum or variable price provisions, and the approximate
          timing of the actions under the contracts. The table does not include
          obligations under agreements that we can cancel without a significant
          penalty.
       
          Off-Balance Sheet Arrangements
       
          We did not have during the periods presented, and we do not currently
          have, any off-balance sheet financing arrangements or any
          relationships with unconsolidated entities or financial partnerships,
          including entities sometimes referred to as structured finance or
          special purpose entities, that were established for the purpose of
          facilitating off-balance sheet arrangements or other contractually
          narrow or limited purposes.
       
          Qualitative and Quantitative Disclosures about Market Risk
       
          We are exposed to market risks in the ordinary course of our business.
          Market risk represents the risk of loss that may impact our financial
          position due to adverse changes in financial market prices and rates.
          Our market risk exposure is primarily the result of fluctuations in
          interest rates and foreign currency exchange rates.
       
          Interest Rate Risk
       
          At December 31, 2020, we had cash and cash equivalents of
          $100.3 million. Interest-earning instruments carry a degree of
          interest rate risk. We do not enter into investments for trading or
          speculative purposes and have not used any derivative financial
          instruments to manage our interest rate risk exposure. As of
          December 31, 2020, we had $230.0 million outstanding on our 2020
          Credit Facility which accrued interest, at our election, of LIBOR plus
          an applicable margin or a base rate plus an applicable margin. A
          hypothetical 10% change in interest rates would not result in a
          material impact on our consolidated financial statements.
       
          Foreign Currency Exchange Risk
       
          All of our sales are denominated in U.S. dollars, and therefore our
          revenue is not currently subject to significant foreign currency risk.
          Our operating expenses are denominated in the currencies of the
          countries in which our operations are located, which are primarily in
          the United States, Canada, the Netherlands, Germany, and India. Our
          consolidated results of operations and cash flows are, therefore,
          subject to fluctuations due to changes in foreign
       
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          currency exchange rates and may be adversely affected in the future
          due to changes in foreign exchange rates. To date, we have not entered
          into any hedging arrangements with respect to foreign currency risk or
          other derivative financial instruments, although we may choose to do
          so in the future. A hypothetical 10% increase or decrease in the
          relative value of the U.S. dollar to other currencies would not have a
          material effect on our operating results.
       
          Critical Accounting Policies and Estimates
       
          Our consolidated financial statements are prepared in accordance with
          accounting principles generally accepted in the United States. The
          preparation of these consolidated financial statements requires us to
          make estimates and assumptions that affect the reported amounts of
          assets, liabilities, revenue, costs and expenses, and related
          disclosures. On an ongoing basis, we evaluate our estimates and
          assumptions. Our actual results may differ from these estimates under
          different assumptions or conditions.
       
          We believe that the following accounting policies involve a greater
          degree of judgment and complexity. Accordingly, these are the policies
          we believe are the most critical to aid in fully understanding and
          evaluating our consolidated financial condition and results of our
          operations.
       
          Revenue Recognition
       
          We adopted Financial Accounting Standards Board Accounting Standards
          Codification or ASC, Topic 606, Revenue from Contracts with Customers,
          or ASC 606, and ASC 340-40, Contract Costs, effective January 1, 2019,
          using the modified retrospective method of adoption. ASC 606 was
          applied only to contracts that are not completed at the date of
          initial application. The adoption of ASC 606 did not result in any
          significant changes to the amount and timing of revenue recognition in
          prior, current or future periods. Therefore, there was no cumulative
          adjustment as a result of adoption. The reported results for fiscal
          year 2019 onwards reflect the application of ASC 606, while the
          reported results for fiscal years presented prior to adoption are not
          adjusted and continue to be reported under ASC 605.
       
          We account for revenue using the following steps:
       
          1. Identify the contract with a customer
       
          We consider the terms and conditions of the contract and our customary
          business practices in identifying our contracts under ASC 606. We
          determine we have a contract with a customer when the customer agrees
          to the terms of service, we can identify each party’s rights regarding
          the services to be transferred, we can identify the payment terms for
          the services, we have determined the customer has the ability and
          intent to pay and the contract has commercial substance. We apply
          judgment in determining the customer’s ability and intent to pay,
          which is based on a variety of factors, including the customer’s
          historical payment experience or, in the case of a new customer, we
          apply security checks and validate their payment method.
       
          2. Identify the performance obligations in the contract
       
          Our performance obligation is to provide our cloud-based
          infrastructure for customers to use at the customers’ election. The
          availability of services is free of charge, and therefore we have no
          performance obligation until the customer elects to use the services.
       
          3. Determine the transaction price
       
          The transaction price is calculated based on the customer’s usage for
          the month at an hourly rate that is published on the Company’s
          website. None of our contracts contain a significant financing
          component.
       
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          4. Allocate the transaction price to performance obligations in the
          contract
       
          The transaction price is calculated based on actual monthly usage and
          pricing that is published on the Company’s website. This is considered
          a single performance obligation, and thus the entire transaction price
          is allocated to the single performance obligation.
       
          5. Recognize revenue when or as we satisfy a performance obligation
       
          We provide cloud computing services, including but not limited to
          compute, storage and networking, to our customers. We recognize
          revenue based on the customer utilization of these resources. Customer
          contracts are primarily month-to-month and do not include any minimum
          guaranteed quantities or fees. Fees are billed monthly, and payment is
          typically due upon invoicing. Revenue is recognized net of allowances
          for credits and any taxes collected from customers, which are
          subsequently remitted to governmental authorities.
       
          Our global cloud platform is supported by various third parties. We
          considered the principal versus agent guidance in ASC 606 and
          concluded that we are the principal for all services provided to its
          customers.
       
          We may offer sales incentives in the form of promotional and referral
          credits and grant credits to encourage customers to use our services.
          These types of promotional and referral credits typically expire in
          two months or less if not used. For credits earned with a purchase,
          they are recorded as contract liabilities when earned and recognized
          at the earlier of redemption or expiration. The majority of credits
          are redeemed in the month they are earned.
       
          Timing of revenue recognition may differ from the timing of invoicing
          to customers. We record a receivable when revenue is recognized prior
          to invoicing. Any payments received in advance of billing are a
          contract liability, which is recorded as Deferred revenue within Total
          current liabilities on the Consolidated Balance Sheets.
       
          Accounts Receivable and Allowance for Doubtful Accounts
       
          Accounts receivable primarily represents revenue recognized that was
          not invoiced at the balance sheet date and is primarily collected in
          the following month. We maintain the allowance for doubtful accounts
          for estimated losses expected to result from the inability of some
          customers to make payments as they become due. We continuously monitor
          collections and payments from our customers and maintain a provision
          for estimated credit losses based on historical loss patterns, the
          number of days that customer invoices are past due and an evaluation
          of the potential risk of loss associated with specific accounts. When
          management becomes aware of circumstances that may further decrease
          the likelihood of collection, it records a specific allowance against
          amounts due, which reduces the receivable to the amount that
          management reasonably believes will be collected. We record changes in
          our estimate to the allowance for doubtful accounts through bad debt
          expense and relieve the allowance after the potential for recovery is
          considered remote. While such credit losses have historically been
          within our expectations and the provisions established, we cannot
          guarantee that we will continue to experience the same credit loss
          rates that we have in the past.
       
          Internal-Use Software Costs
       
          We capitalize costs to develop software for internal use when both the
          preliminary project stage is complete and management has authorized
          further funding for the project based on a determination that it is
          both probable that the project will be completed and used to perform
          the function intended. Costs related to preliminary project activities
          and post implementation activities are expensed as incurred.
          Capitalized costs include external consulting fees, payroll and
          payroll-related costs, and stock-based compensation for employees in
          our development teams who are directly associated with, and who devote
          time to, our internal-use software projects during the application
          development stage. Once an application has reached the development
          stage, qualifying
       
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          internal and external costs are capitalized until the application is
          substantially complete and ready for its intended use. Capitalized
          qualifying costs are amortized on a straight-line basis when the
          software is ready for its intended use over an estimated useful life,
          which is generally three years. We evaluate the useful lives of these
          assets on an annual basis and test for impairment whenever events or
          changes in circumstances occur that could impact the recoverability of
          these assets.
       
          We exercise judgment in determining the point at which various
          projects may be capitalized, in assessing the ongoing value of the
          capitalized costs and in determining the estimated useful lives over
          which the costs are amortized.
       
          Stock-Based Compensation
       
          Compensation expense related to stock-based transactions, including
          employee, consultant, and non-employee director stock option awards,
          is measured and recognized in the consolidated financial statements
          based on fair value. The fair value of each option award is estimated
          on the grant date using the Black Scholes option-pricing model.
          Expense is recognized on a straight-line basis over the vesting period
          of the award.
       
          Our option-pricing model requires the input of highly subjective
          assumptions, including the fair value of the underlying common stock,
          the expected term of the option, the expected volatility of the price
          of our common stock, risk-free interest rates, and the expected
          dividend yield of our common stock. The assumptions used in our
          option-pricing model represent management’s best estimates.
       
          These assumptions are estimated as follows:
       
          •
       
          Fair value. Because our common stock is not yet publicly traded, we
          must estimate the fair value of common stock. Our board of directors
          considers numerous objective and subjective factors to determine the
          fair value of our common stock at each meeting in which awards are
          approved.
       
          •
       
          Expected volatility. Expected volatility is a measure of the amount by
          which the stock price is expected to fluctuate. Since we do not have
          sufficient trading history of our common stock, we estimate the
          expected volatility of our stock options at the grant date by taking
          the average historical volatility of a group of comparable publicly
          traded companies over a period equal to the expected life of the
          options.
       
          •
       
          Expected life in years. We determine the expected term based on the
          average period the stock options are expected to remain outstanding
          using the simplified method, generally calculated as the midpoint of
          the stock options’ vesting term and contractual expiration period, as
          we do not have sufficient historical information to develop reasonable
          expectations about future exercise patterns and post-vesting
          employment termination behavior.
       
          •
       
          Risk-free rate. We use the U.S. Treasury yield for our risk-free
          interest rate that corresponds with the expected term.
       
          •
       
          Expected dividend yield. We utilize a dividend yield of zero, as we do
          not currently issue dividends, nor do we expect to do so in the
          future.
       
          The following assumptions were used to calculate the fair value of
          stock options granted:
       
          December 31,
       
                2019      
       
              2020    
       
          Expected volatility
       
          47.84
       
          % 
       
          52.06
       
          % 
       
          Expected life in years
       
          6
       
          6
       
          Risk-free interest rate
       
          1.78
       
          % 
       
          0.57
       
          % 
       
          Expected dividend yield
       
          0
       
          % 
       
          0
       
          % 
       
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          We estimate the expected forfeiture rate and only recognize expense
          for those shares that are expected to vest. We estimate the expected
          forfeiture rate at the date of grant based on historical experience
          and our expectations regarding future pre-vesting termination behavior
          of employees and other service providers and revise the estimates, if
          necessary, in subsequent periods if actual forfeitures differ from
          those estimates. To the extent our actual forfeiture rate is different
          from our estimate, stock-based compensation is adjusted accordingly.
       
          We will continue to use judgment in evaluating the assumptions related
          to our stock-based compensation on a prospective basis. As we continue
          to accumulate additional data related to our common stock, we may have
          refinements to our estimates, which could materially impact our future
          stock-based compensation.
       
          Common Stock Valuations
       
          The fair value of the common stock underlying our stock-based awards
          has historically been determined by our board of directors, with input
          from management and contemporaneous third-party valuations. We believe
          that our board of directors has the relevant experience and expertise
          to determine the fair value of our common stock. Given the absence of
          a public trading market of our common stock, and in accordance with
          the American Institute of Certified Public Accountants Practice Aid,
          Valuation of Privately-Held Company Equity Securities Issued as
          Compensation, our board of directors exercised reasonable judgment and
          considered numerous objective and subjective factors to determine the
          best estimate of the fair value of our common stock at each grant
          date. These factors include:
       
          •
       
          contemporaneous valuations of our common stock performed by
          independent third-party specialists;
       
          •
       
          the prices, rights, preferences, and privileges of our convertible
          preferred stock relative to those of our common stock;
       
          •
       
          the prices of common or preferred stock sold to third-party investors
          by us and in secondary transactions or repurchased by us in
          arm’s-length transactions;
       
          •
       
          lack of marketability of our common stock;
       
          •
       
          our actual operating and financial performance;
       
          •
       
          current business conditions and projections;
       
          •
       
          hiring of key personnel and the experience of our management;
       
          •
       
          the history of the company and the introduction of new products;
       
          •
       
          our stage of development;
       
          •
       
          likelihood of achieving a liquidation event, such as an initial public
          offering or a merger or acquisition of our company given prevailing
          market conditions;
       
          •
       
          the market performance of comparable publicly traded companies; and
       
          •
       
          the U.S. and global capital market conditions.
       
          In valuing our common stock, our board of directors determined the
          equity value of our business using various valuation methods including
          combinations of income and market approaches with input from
          management. The income approach estimates value based on the
          expectation of future cash flows that a company will generate. These
          future cash flows are discounted to their present values using a
          discount rate derived from an analysis of the cost of capital of
          comparable publicly traded companies in our industry or similar
          business operations as of each valuation date and is adjusted to
          reflect the risks inherent in our cash flows.
       
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          For each valuation, the equity value determined by the income and
          market approaches was then allocated to the common stock using either
          the option pricing method, or the OPM, or a combination of the OPM and
          the probability-weighted expected return method, or the PWERM, which
          is referred to as the hybrid method. The OPM allocates the overall
          company value to the various share classes based on differences in
          liquidation preferences, participation rights, dividend policy and
          conversion rights, using a series of call options. The call right is
          valued using a Black-Scholes option pricing model. The PWERM employs
          additional information not used in the OPM, including various market
          approach calculations depending upon the likelihood of various
          discrete future liquidity scenarios, such as an initial public
          offering or the sale of the company, as well as the probability of
          remaining a private company.
       
          In addition, we also considered any secondary transactions involving
          our capital stock. In our evaluation of those transactions, we
          considered the facts and circumstances of each transaction to
          determine the extent to which they represented a fair value exchange.
          Factors considered include transaction volume, timing, whether the
          transactions occurred among willing and unrelated parties, and whether
          the transactions involved investors with access to our financial
          information.
       
          Application of these approaches involves the use of estimates,
          judgment, and assumptions that are highly complex and subjective, such
          as those regarding our expected future revenue, expenses, and future
          cash flows, discount rates, market multiples, the selection of
          comparable companies, and the probability of possible future events.
          Changes in any or all of these estimates and assumptions or the
          relationships between those assumptions impact our valuations as of
          each valuation date and may have a material impact on the valuation of
          our common stock.
       
          For valuations after the completion of this offering, our board of
          directors will determine the fair value of each share of underlying
          common stock-based on the closing price of our common stock as
          reported on the date of grant. Future expense amounts for any
          particular period could be affected by changes in our assumptions or
          market conditions.
       
          Incomes Taxes
       
          We account for income taxes using the asset and liability method,
          which requires the recognition of deferred tax assets and liabilities
          for the expected future tax consequences of events that have been
          recognized in our financial statements or tax returns. In addition,
          deferred tax assets are recorded for the future benefit of utilizing
          net operating losses and research and development credit
          carryforwards. Valuation allowances are provided when necessary to
          reduce deferred tax assets to the amount expected to be realized. We
          recognize taxes on Global Intangible Low-Taxed Income as a current
          period expense when incurred.
       
          We apply the authoritative accounting guidance prescribing a threshold
          and measurement attribute for the financial recognition and
          measurement of a tax position taken or expected to be taken in a tax
          return. We recognize liabilities for uncertain tax positions based on
          a two-step process. The first step is to evaluate the tax position for
          recognition by determining if the weight of available evidence
          indicates that it is more likely than not that the position will be
          sustained on audit, including resolution of related appeals or
          litigation processes, if any. The second step requires us to estimate
          and measure the tax benefit as the largest amount that is more than
          50% likely to be realized upon ultimate settlement.
       
          Significant judgment is required in evaluating our uncertain tax
          positions and determining our provision for income taxes. Although we
          believe our reserves are reasonable, no assurance can be given that
          the final tax outcome of these matters will not be different from that
          which is reflected in our historical income tax provisions and
          accruals. We adjust these reserves in light of changing facts and
          circumstances, such as the closing of a tax audit or the refinement of
          an estimate. To the extent that the final tax outcome of these matters
          is different than the amounts recorded, such differences may impact
          the provision for income taxes in the period in which such
          determination is made.
       
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          Significant judgment is also required in determining any valuation
          allowance recorded against deferred tax assets. In assessing the need
          for a valuation allowance, we consider all available evidence,
          including scheduled reversal of deferred tax liabilities, past
          operating results, the feasibility of tax planning strategies and
          estimates of future taxable income. Estimates of future taxable income
          are based on assumptions that are consistent with our plans.
          Assumptions represent management’s best estimates and involve inherent
          uncertainties and the application of management’s judgment. Should
          actual amounts differ from our estimates, the amount of our tax
          expense and liabilities could be materially impacted.
       
          We do not provide for a U.S. income tax liability and foreign
          withholding taxes on undistributed foreign earnings of our foreign
          subsidiaries as a result of cumulative and current overall foreign
          loss. The earnings of non-U.S. subsidiaries are currently expected to
          be indefinitely reinvested in non-U.S. operations.
       
          Recently Adopted Accounting Pronouncements
       
          See the sections titled “Summary of Significant Accounting
          Policies—Recent Accounting Pronouncements—Pending Adoption” and
          “—Recent Accounting Pronouncements—Adopted” in Note 2 of the notes to
          our consolidated financial statements included elsewhere in this
          prospectus for more information.
       
          Internal Controls Over Financial Reporting
       
          In the course of preparing our audited consolidated financial
          statements for the year ended December 31, 2019, we identified a
          material weakness in our internal controls over financial reporting
          related to secondary sales of our common stock by current and former
          employees. We have remediated this material weakness, which we believe
          has addressed the underlying cause of this issue. For additional
          information, see “Risk Factors—If we are unable to maintain proper and
          effective internal controls over financial reporting, investor
          confidence in our company and, as a result, the value of our common
          stock may be adversely impacted. We previously identified and
          remediated a material weakness in our internal controls over financial
          reporting.”
       
          Emerging Growth Company Status
       
          We are an emerging growth company, as defined under the JOBS Act. The
          JOBS Act provides that an emerging growth company may take advantage
          of the extended transition period provided in Section 7(a)(2)(B) of
          the Securities Act for complying with new or revised accounting
          standards. Therefore, an emerging growth company can delay the
          adoption of certain accounting standards until those standards would
          otherwise apply to private companies. We have elected to use the
          extended transition period under the JOBS Act until the earlier of the
          date we (1) are no longer an emerging growth company or
          (2) affirmatively and irrevocably opt out of the extended transition
          period provided in the JOBS Act. As a result, our financial statements
          may not be comparable to companies that comply with new or revised
          accounting pronouncements as of public company effective dates.
       
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          BUSINESS
       
          Overview
       
          Our mission is to simplify cloud computing so that developers and
          businesses can spend more time building software that changes the
          world.
       
          DigitalOcean is a leading cloud computing platform offering on-demand
          infrastructure and platform tools for developers, start-ups and small
          and medium-sized businesses, or SMBs. We were founded with the guiding
          principle that the transformative benefits of the cloud should be easy
          to leverage, broadly accessible, reliable and affordable. Our platform
          simplifies cloud computing, enabling our customers to rapidly
          accelerate innovation and increase their productivity and agility.
          Over 570,000 individual and business customers currently use our
          platform to build, deploy and scale software applications. Our users
          include software engineers, researchers, data scientists, system
          administrators, students and hobbyists. Our customers use our platform
          across numerous industry verticals and for a wide range of use cases,
          such as web and mobile applications, website hosting, e-commerce,
          media and gaming, personal web projects, and managed services, among
          many others. We believe that our focus on simplicity, community, open
          source and customer support are the four key differentiators of our
          business, driving a broad range of customers around the world to build
          their applications on our platform.
       
          Cloud computing is revolutionizing how companies across the globe
          develop and deploy applications. The cloud offers lower upfront cost
          and superior flexibility, extensibility and scalability as compared to
          on-premise software development environments. These benefits are
          especially valuable for start-ups and SMBs, as they typically have
          more limited financial resources, operational expertise and IT
          personnel. As software and cloud-based technologies have become
          essential across industries and businesses of all sizes, the number of
          software developers and their strategic importance to organizations
          are both increasing significantly. According to SlashData, the number
          of developers globally was 19 million in 2019 and is expected to grow
          to 45 million by 2030.
       
          Improving the developer experience and increasing developer
          productivity are core to our mission. Our developer cloud platform was
          designed with simplicity in mind to ensure that software developers
          can spend less time managing their infrastructure and more time
          turning their ideas into innovative applications to grow their
          businesses. Simplicity guides how we design and enhance our
          easy-to-use-interface, the core capabilities we offer our customers
          and our approach to predictable and transparent pricing for our
          solutions. We offer mission-critical infrastructure solutions across
          compute, storage and networking, and we also enable developers to
          extend the native capabilities of our cloud with fully managed
          application, container and database offerings. In just minutes,
          developers can set up thousands of virtual machines, secure their
          projects, enable performance monitoring and scale up and down as
          needed. Our pricing is consumption-based and billed monthly in
          arrears, making it easy for our customers to track usage on an ongoing
          basis and optimize their deployments.
       
          The global developer and open source communities are fundamental to
          our business, and a key source of ideas and innovations that support
          our sustained growth. Our developer-centric approach has helped us
          foster a large and loyal following. We attract approximately 5 million
          monthly unique visitors to our websites, host what we believe is the
          largest hackathon in the world, and offer a comprehensive library of
          high-quality technical tutorials and community-generated questions and
          answers. Developers and SMBs especially value open source technology
          as it allows them greater choice, affordability and flexibility, and
          our platform is designed to take advantage of open source technology
          to provide our customers with a much more efficient way to work. Our
          participation in and support of the open source community further
          enhance the attractiveness, depth and scalability of our offering.
       
          Our customers depend on us for their critical business needs, and we
          are passionate about providing superior 24x7 customer support to all
          of our customers, regardless of size. We believe our customer support,
          coupled with
       
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          our easy-to-use self-help resources and active developer community,
          has created tremendous brand loyalty amongst our growing customer
          base. Our customers become great advocates for DigitalOcean and are a
          common source of new customer referrals. We are proud of our Net
          Promoter Score, or NPS, which averaged 65 during 2020, comparable to
          some of the world’s most beloved brands.
       
          We have a highly efficient self-service customer acquisition model,
          which we have recently complemented with a targeted inside sales
          force. Our sales and marketing expense as a percentage of revenue was
          approximately 14%, 12% and 11% in 2018, 2019 and 2020, respectively.
          The efficiency of our go-to-market model and our focus on the needs of
          the individual and SMB markets have helped us build a global customer
          base that continues to grow. We had approximately 573,000 customers as
          of December 31, 2020, up from approximately 502,000 as of December 31,
          2018. Our customers are spread across over 185 countries, and around
          two-thirds of our revenue has historically come from customers located
          outside the United States. We have a growing number of customers with
          higher spending levels, and our existing customers are continuing to
          expand their business with us. Our average revenue per customer (which
          we refer to as ARPU) has increased significantly, from $35.97 in 2018
          to $40.16 in 2019 to $47.78 in 2020. See the section titled
          “Management’s Discussion and Analysis of Financial Condition and
          Results of Operations—Key Business Metrics” for additional
          information.
       
          We have experienced strong revenue growth and improving margins in
          recent periods. For the years ended December 31, 2018, 2019 and 2020,
          our revenue was $203.1 million, $254.8 million and $318.4 million,
          respectively, representing year-over-year growth of 25% in 2019 and
          2020. Our net loss attributable to common stockholders was
          $36.0 million, $40.4 million and $43.6 million for the years ended
          December 31, 2018, 2019 and 2020, respectively. Our adjusted EBITDA
          was $39.5 million, $55.2 million and $95.9 million for the years ended
          December 31, 2018, 2019 and 2020, respectively. Our net cash provided
          by operating activities was $38.0 million, $39.9 million and
          $58.1 million for the years ended December 31, 2018, 2019 and 2020,
          respectively. See the section titled “Selected Consolidated Financial
          Data—Non-GAAP Financial Measures” for additional information regarding
          adjusted EBITDA, the limitations of this non-GAAP financial measure
          and a reconciliation of this measure to the most directly comparable
          financial measure stated in accordance with GAAP.
       
          Industry Background
       
          There are a number of key technology and industry trends driving our
          opportunity, including:
       
          •
       
          The Growing Need for Technological Innovation is Driving Cloud
          Computing Adoption. Technology is transforming how businesses of all
          sizes engage with customers, manage their operations and drive
          competitive advantages. The global phenomenon of technology-powered
          growth and innovation requires nearly every company to focus their
          efforts on harnessing the power of technology through cloud services.
          Cloud computing has become the new standard for IT infrastructure as
          organizations seek to benefit from the flexibility, scalability and
          reliability of the cloud. Cloud technologies enable businesses to
          better focus their efforts on customer applications rather than the
          physical infrastructure required to support their operations.
          Start-ups and SMBs are particularly focused on leveraging the cloud
          for capabilities that would otherwise be inaccessible due to the high
          cost and expertise needed to deploy these capabilities on-premise.
       
          •
       
          Proliferation of Cloud Native Start-Ups and SMBs. There are more than
          32 million SMBs in the United States alone, according to the World
          Bank, and we estimate there are at least three times that number, or
          100 million SMBs, globally. We expect this number will continue to
          grow, with more than 14 million net new SMBs created globally each
          year. This has been driven in part by significantly lower barriers to
          entry for entrepreneurs looking to create and grow new businesses. In
          addition, the founding teams of these SMBs are no longer comprised
          only of technical individuals with advanced software development
          capabilities, but now include a far wider range of individuals. These
          individuals
       
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          are able to leverage simple and reliable development tools and the
          widespread availability and significantly lower upfront cost of cloud
          computing to start companies. As such, a significant proportion of
          start-ups and SMBs are being built in the cloud to benefit from the
          faster, cheaper and easier way to deploy and manage their business
          solutions.
       
          •
       
          Software Developers Are Increasingly Influential Within Organizations.
          Companies increasingly rely on developers to quickly adapt to changing
          technological and business trends in order to compete. This trend has
          contributed to the shift to the cloud as cloud-based technologies
          increase the efficiency and flexibility of those developers. Developer
          productivity has become a top priority for companies around the world
          as they recognize the significant benefits derived from providing
          developers with the most powerful tools available. As a result, the
          global developer population, which according to SlashData will reach
          45 million by 2030, has become increasingly influential on
          technology-related investment decisions. Across industries and
          companies of all sizes, IT procurement has shifted from an inefficient
          and slow-moving process to a more nimble model, with software
          developers at the forefront of the decision-making.
       
          •
       
          Open Source Software Is Accelerating Innovation. Open source
          technologies are powering many of the world’s most innovative
          start-ups and SMBs. This trend is expansive and being driven primarily
          by developers who are increasingly empowered to use the most efficient
          tools to accelerate the pace of innovation. Open source software
          enables individuals and businesses to access and use low cost, proven
          software tools for their applications instead of investing the time
          and resources in recreating the same use cases in self-developed
          software. Businesses of all sizes benefit from the many advantages of
          open source including, lower costs, increased speed to market,
          application reliability and flexibility and improved security. The
          rise of open source is expected to continue in the coming years.
          According to a 2019 survey by IDC, 71% of organizations use open
          source software and, over the next 12 to 24 months, over 50% plan to
          expand their use of open source software and another 7% that do not
          currently use open source software plan to start using it.
       
          •
       
          Organizations are Increasingly Using Multiple Clouds. According to
          IDC, 88% of organizations have employed a multi-cloud approach for
          their cloud and hosting services. Multi-cloud deployments have become
          increasingly common as individuals and businesses seek to match their
          applications with the best technology stacks and commercial models to
          run them while avoiding vendor lock-in akin to legacy IT
          infrastructure services. The future growth of the cloud-computing
          market across the globe will benefit significantly from this expanding
          trend of multi-cloud adoption.
       
          Limitations of Existing Offerings on Developers, Start-Ups and SMBs
       
          Existing offerings from large public cloud vendors are designed for
          complex, enterprise use cases such as migrating legacy workloads from
          on-premise to the cloud. The products and services offered by these
          vendors are not tailored for the needs of individual developers,
          start-ups or SMBs. These offerings lack the simplicity required by
          these users, suffer from near-infinite feature complexity and have
          opaque pricing and billing practices that are often accompanied by
          significant hidden costs. As a result, developers, start-ups and SMBs
          are often unable to leverage the benefits of cloud-based technologies.
       
          The limitations of these enterprise-focused offerings include the
          following:
       
          •
       
          Difficult to Use. Enterprise-focused vendors frequently have
          complicated implementation processes, which require a significant
          amount of time to learn complex user interfaces and features rather
          than allowing developers to focus on building and deploying
          applications. These unintuitive or inconveniently packaged services
          have limited the ability of start-ups and SMBs, who typically do not
          have IT departments or large teams, to maximize the value of their
          cloud investments due to the amount of time and resources required to
          train on and manage underlying infrastructure.
       
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          •
       
          Uncurated Set of Offerings. Traditional public cloud vendors have
          built their platforms to serve global enterprises with large
          development teams. The thousands of ancillary products and services
          that are offered by these vendors create a significant amount of
          complexity that is difficult for developers, start-ups, and SMBs to
          manage.
       
          •
       
          Complex and Opaque Pricing. Existing cloud providers often have
          intricate and unpredictable pricing and billing practices. The lack of
          pricing transparency frequently leads to surprise charges and higher
          than expected costs, making budgeting and cost optimization very
          difficult. Companies frequently need dedicated employees, pricing
          analytics tools or even specialized consultants to understand how
          products are priced and how to manage their bills. The potential for
          unexpected or unbudgeted charges is especially burdensome for
          start-ups and SMBs that do not have the same financial resources as
          larger enterprises.
       
          •
       
          Lack of Customer Support. As traditional public cloud vendors target
          large enterprise customers, smaller buyers often do not get the
          necessary level of support required to manage their infrastructure.
          These smaller buyers, including start-ups and SMBs, are often those
          most in need of and reliant on support to help them manage their
          infrastructure effectively and efficiently. The lack of a focused
          customer support ecosystem to assist these smaller customers is
          further exacerbated by the complexity of the documentation produced by
          large cloud vendors.
       
          Our Solution
       
          DigitalOcean was founded with the guiding principle that the
          transformative benefits of the cloud should be easy to leverage,
          broadly accessible, reliable and affordable. We pioneered the
          developer cloud platform to simplify cloud computing, enabling
          developers and developer teams to quickly deploy and scale
          applications, collaborate efficiently and improve business
          performance. Empowered by an easy-to-use self-service model, intuitive
          control panel and highly predictable pricing, our customers are able
          to rapidly accelerate innovation and increase their productivity and
          agility.
       
          •
       
          Simple and Intuitive. Our platform is engineered to take a user from
          inquiry to deployment within minutes, without any specialized training
          or heavy implementation. We abstract away the complexity that is
          generally found across legacy cloud providers to provide a compelling,
          intuitive interface with click-and-go options. Our platform provides
          users with a deployment interface that is comparable to interfaces
          provided by consumer internet leaders and is designed to minimize the
          number of steps to deployment.
       
          •
       
          Designed by Developers for Developers. Our platform was built with a
          developer-first mentality and is designed for a wide range of use
          cases, such as web and mobile applications, website hosting,
          e-commerce, media and gaming, personal web projects, and managed
          services, among many others. Our innovative cloud platform is designed
          to eliminate the complexity and obstacles associated with deploying in
          and managing the cloud. Simplicity starts with our Droplets, which
          have revolutionized the way developers and teams deploy in the cloud.
          Droplets are our virtual machines that can be spun up in less than a
          minute, enabling developers to spend less time managing infrastructure
          and more time innovating.
       
          •
       
          Built to Help Businesses Scale. Our highly-curated set of solutions,
          including compute, storage and networking offerings, managed databases
          and developer and management tools, are all designed to address the
          needs of start-ups and SMBs as they scale their businesses and require
          more cloud capabilities. Our managed services, including our Managed
          Database, Managed Kubernetes and App Platform services, are
          specifically focused on enabling our SMB customers—regardless of
          business type or geography—to scale their operations on our platform.
       
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          •
       
          Open Source. Our participation in and support of the open source
          software community enhances the attractiveness, depth and scalability
          of our offering. It increases the transparency of our technology and
          allows our customers to more efficiently write their own integrations.
          We give back to the community by sponsoring projects to create content
          and tools that help developers build great software and hosting events
          that are focused on driving the growth of open source, such as our
          Hacktoberfest, which we believe is the largest hackathon in the world.
       
          •
       
          Differentiated Customer Support. We offer expert 24x7 technical
          support and customer service, with support staff spanning various time
          zones to ensure our customers quickly achieve their objectives and
          overcome challenges. Developers and engineers are a key part of our
          customer support team, and our technical support is—and always has
          been—available free of charge to all customers. Customers cite our
          attentive support as a key driver of their decision to start and grow
          their businesses on our platform.
       
          •
       
          Broad-Based Community Ecosystem: We have built one of the world’s
          largest developer learning communities, with approximately 6,000
          high-quality developer tutorials and over 28,000 community-generated
          questions & answers. The strength and continued growth of our
          community ecosystem, which is managed by our internal developer
          relations and editorial teams, is predicated on differentiated content
          on our community education website, which attracts approximately
          3.5 million monthly unique visitors. As our community grows and
          generates more valuable content for our platform, we are able to
          attract more users, which ultimately increases our customer base and
          reinforces our highly efficient self-service model.
       
          •
       
          Transparent and Predictable Pricing. Our approach to billing and
          pricing is simple, intuitive and transparent. Our pricing is
          consumption-based and renewable monthly, making it easy for our
          customers to optimize their deployments. We provide detailed monthly
          invoices, irrespective of the customer’s size or number of products
          purchased, making it easy to track usage on an ongoing basis. We
          enable our customers to completely control their spending and ensure
          there are no hidden charges that appear at the end of the month. Like
          everything we do, we approach billing with a customer-first focus,
          enabling our customers to spend more time developing and deploying
          innovative applications rather than interpreting and navigating
          convoluted invoices.
       
          •
       
          Security and Data Protection. Maintaining the security and integrity
          of our platform is a critical focus for us, as well as for our
          customers who rely on us for their critical business needs. We invest
          significantly in securing the computing infrastructure foundation upon
          which our customers build and scale their projects. We remove the
          complexity of securing infrastructure for our customers and make it
          simple for them to build the security layers required for their use
          cases. We are also committed to customer data privacy and utilize
          best-in-class access, encryption and data protection technologies and
          processes.
       
          •
       
          Built for Collaboration. Our platform enables secure and efficient
          collaboration across developer teams to manage and scale
          infrastructure and applications. We support thousands of developer
          teams on our platform and provide them with easy-to-use tools to
          better manage their workflows.
       
          Key Benefits to Our Customers
       
          Our solution is designed to empower our target customers with
          best-in-class cloud technologies, while supporting them with superior
          customer service. This customer-centric focus underpins our mission of
          simplifying cloud computing so developers and businesses can spend
          more time building software that changes the world. Our NPS averaged
          65 during 2020, which is comparable to some of the world’s most
          beloved brands. For our customers, the key benefits of our solution
          include:
       
          •
       
          Accelerating innovation by leveraging the full power of the cloud
       
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          •
       
          Making it simple to build, deploy and scale applications
       
          •
       
          Achieving rapid time-to-value with a reliable, highly-performant and
          cost-effective platform
       
          •
       
          Spending less time managing infrastructure and more time on higher
          value tasks that drive the growth and success of their businesses
       
          •
       
          Superior customer support that is free to all customers
       
          •
       
          A highly-reliable, scalable and secure platform
       
          We have a highly diverse customer base that uses our platform for a
          variety of projects and applications. Recent customer success stories
          include:
       
          •
       
          RouteTrust, a telecommunications start-up, launched a
          Platform-as-a-Service (PaaS) offering that processes billions of voice
          calls each month using our Droplets and our Managed Kubernetes
          service.
       
          •
       
          Cloudways, a managed hosting company in Malta, provides web hosting
          services to over 250,000 websites using our Droplets.
       
          •
       
          Rockerbox, an advertising and analytics company, dramatically reduced
          their cloud costs by 80% by efficiently running their data collection
          and analysis using our Droplets and our Managed Kubernetes, Managed
          Databases, Load Balancers and Spaces services.
       
          •
       
          Jiji, an online marketplace platform in Nigeria, serves over 200
          million buyers and sellers across five countries in Africa.
       
          •
       
          Parabol, a remote meeting platform for teams embracing agile
          practices, makes it easier to host planning sessions, scrums and
          meetings online using our Droplets and our Managed Database service.
       
          •
       
          Centra, a Software-as-a-Service (SaaS)-based e-commerce platform in
          Sweden, provides a powerful backend offering that allows brands to
          build custom-designed, online flagship stores.
       
          •
       
          An entrepreneur in the United Kingdom utilizes our Managed Kubernetes
          service and open source software to profitably scale his API-centric
          product helping online media companies automate their quality
          assurance testing.
       
          Our Market Opportunity
       
          The Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service
          (PaaS) markets are two of the largest and fastest growing markets
          across all industries. According to IDC, the worldwide IaaS and PaaS
          markets for individuals and companies with less than 500 employees are
          estimated to be approximately $44.4 billion in the aggregate in 2020.
          The 2020 IaaS market, which is comprised of compute and storage, was
          estimated to be $31.9 billion. The 2020 PaaS market, which includes
          database management systems, application platforms and other platform
          services, was estimated to be $12.5 billion. According to IDC, these
          combined IaaS and PaaS markets are expected to grow to $115.5 billion
          in 2024, representing a 27% compound annual growth rate.
       
          We believe the individual developer, start-up and SMB markets are
          underserved, and we expect our massive addressable market to continue
          to grow rapidly beyond 2024. The key drivers of this growth come from
          the increasing technological innovation which drives cloud adoption
          combined with the growing number of developers and SMBs worldwide.
          According to SlashData, the global developer population is expected to
          more than double over the next 10 years to approximately 45 million by
          2030. Furthermore, there are more than
       
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          32 million SMBs in the United States alone, according to the World
          Bank, and we estimate that there are at least three times that number,
          or 100 million SMBs, globally. We expect this number will continue to
          grow, with more than 14 million net new SMBs created globally each
          year.
       
          Our Growth Strategies
       
          We are driving significant growth by executing on the following key
          strategies:
       
          •
       
          Growing Our Customer Base. We believe there is a substantial
          opportunity to further expand our customer base. We have historically
          attracted customers by offering a low-friction, self-service cloud
          platform combined with a highly-efficient self-service marketing
          model. We are investing in strategies that we believe will continue to
          drive new customer adoption, especially among SMB customers, including
          new marketing initiatives that further optimize our self-service
          revenue funnel and targeted expansion of our inside sales teams,
          including in select international locations.
       
          •
       
          Increasing Usage by Our Existing Customers. Our customer base of more
          than 570,000 customers represents a significant opportunity for
          further sales expansion through increased usage of our platform and
          adoption of additional product offerings. Our ARPU, which in part
          reflects increased usage by our existing customers, has increased
          significantly in recent years, from $35.97 in 2018 to $40.16 in 2019
          to $47.78 in 2020. We expect to continue to increase our ARPU through
          the introduction of new products tailored to our customer base and an
          expanded go-to-market initiative focused on larger customers and
          specific use cases, both of which will drive enhanced usage of our
          platform and product offerings by our existing customers.
       
          •
       
          Investing in Our Platform and Product Offerings. We have a history of,
          and will continue to invest significantly in, delivering innovative
          products, features and functionality targeted at our core customer
          base. We believe the market opportunity for serving developers,
          start-ups and SMBs is very large and goes far beyond providing the
          core IaaS services of compute, storage and networking. We have
          successfully attracted new customers to our platform and driven
          expansion with existing customers through new product launches, such
          as our Managed Kubernetes offering in late 2018, our Managed Database
          offering in 2019 and our App Platform service in October 2020.
       
          •
       
          Augmenting Our Platform through Opportunistic Strategic Acquisitions.
          We believe that strategic partnerships and acquisitions will allow us
          to accelerate our key platform, product and marketing initiatives. For
          example, our App Platform service originated from an acquisition and
          we have expanded our community tutorial content through two small
          acquisitions, and we believe that additional acquisition opportunities
          will supplement our organic growth strategy. Likewise, we believe that
          strategic opportunities provide an attractive avenue to expand our
          product portfolio and customer base. We intend to actively pursue both
          strategic partnerships and acquisitions that we believe will be
          complementary to our business, accelerate customer acquisition,
          increase usage of our platform and/or expand our product offerings in
          our core markets.
       
          •
       
          Growing and Engaging Our Community. More than 5 million unique
          visitors interact with our websites, including our developer
          community, each month to learn, share and educate others. We are
          committed to supporting and expanding this community of innovators and
          technologists through high-quality content and expanded
          developer-focused programs and events around the world. We had
          approximately 170,000 participants in our Hacktoberfest event in 2020,
          up from 130,000 participants in 2019. In April 2020, we established
          our Hub For Good initiative, to provide infrastructure credits to
          non-profit companies that need resources to pursue charitable and
          philanthropic ambitions. Supporting and educating the developer
          community is one of our core values, but it also drives brand loyalty,
          expands our customer base and drives increased adoption of our
          products.
       
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          Our Platform and Product Offerings
       
          We have designed our global cloud platform to ensure a simple,
          reliable and affordable cloud computing experience for our customer
          base of individual developers, start-ups and SMBs. This entails
          maintaining a high-performance global infrastructure, offering a
          highly curated set of solutions and providing a superior customer
          experience. The combination of these three elements enables our
          customers to focus their time and attention on building and running
          their applications or businesses rather than managing the underlying
          infrastructure.
       
          LOGO
       
          Our Global Infrastructure & Technology Network
       
          Our global infrastructure and technology network, built on the
          foundation of open source scalable cloud-native technologies, allows
          us to deliver an exceptional developer experience and suite of
          infrastructure and software solutions to our more than 570,000
          customers spread across the globe. Our infrastructure is deployed to
          14 data centers worldwide that are connected by a high-speed private
          backbone, enabling our customers to
       
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          deploy their solutions across eight different geographic regions. We
          lease data centers in the New York City and San Francisco metropolitan
          areas, as well as in India, Germany, the United Kingdom, Canada, the
          Netherlands and Singapore. These site locations were selected for
          their close proximity to key customer markets and allow access to
          global internet exchange points to provide consistent low-latency
          connectivity to large end-user networks. This allows our customers to
          choose where best to deploy the solution to optimize performance and
          minimize latency for their users. We lease data center space from
          leading providers to provide us the flexibility to quickly enter new
          markets and align our global footprint with our go-to-market strategy.
       
          We work closely with hardware manufacturers when designing our server
          platforms to continue to reduce acquisitions costs while at the same
          time optimizing reliability and performance for our customers. Our
          hardware engineering team works closely with CPU manufacturers to
          align our long-term server strategy to future technology advancements.
          We staff our data center operations team to ensure that we can provide
          the physical security, reliability and availability necessary for our
          customers—and that team additionally manages the physical server
          capacity to ensure that we are able to meet our customers’
          demands. Our network engineering team manages the global backbone to
          ensure that we are making the best connectivity peering agreements to
          get customer traffic to the destination via the best available path.
          Our operations team actively monitors the cloud environment,
          responding to network incidents to ensure that customer impact is
          minimized and service availability is managed.
       
          We focus heavily on securing our network, products and customer data
          from potential security threats with a dedicated team of security
          professionals. We continually monitor our infrastructure network for
          vulnerabilities and risk through our security observability platform.
          The backend components of our network have been built with a view
          towards security using layers of multi-factor authentication,
          authorization and role-based access and are monitored for abnormal
          behaviors or intrusions. Security architecture and design is embedded
          in our product development lifecycle, and we continually test our
          products and infrastructure for security flaws. In addition, we apply
          rigorous privacy standards to all the customer data we protect in
          accordance with applicable privacy laws and best practices. We have
          put measures in place to collect personal data only to the extent
          necessary to service our customers and we protect customer content
          data through limited access.
       
          In combination, our infrastructure and network provide our customers
          with a reliable, highly-performant and cost-effective platform to
          confidently build, deploy and scale their optimal solution, from
          single node based applications to globally distributed systems.
       
          Our Product Portfolio
       
          We provide a variety of cloud products and services that are
          specifically designed to address the needs of individual developers,
          start-ups and SMBs. We listen carefully to our customers’ feedback so
          we understand what they want and need to simplify cloud computing for
          them. Our goal is to address the core needs of this underserved
          customer base instead of offering thousands of complex products and
          services that are more suited to large enterprise companies or
          companies looking to move from an on-premise environment to the cloud.
          This focus has allowed us to expand our ARPU, especially among our
          larger customers, while maintaining very attractive customer retention
          metrics.
       
          Our initial product, launched in 2012, was the Droplet, a virtual
          machine that provides flexibility to build, test, secure and grow
          customers’ applications from start-up to scale. Since then, we have
          successfully launched many new products, which honor our commitment to
          always provide a simple, reliable and affordable experience for our
          core customer base. We have expanded our product portfolio with
          product innovations such as Dedicated Droplets, Spaces, Managed
          Kubernetes, Managed Databases and App Platform, which have proven our
          ability to successfully launch many new products to market and serve
          our customers’ needs. We have developed a product roadmap that will
          expand our managed and software offerings and enhance our ability to
          offer secure, scalable and reliable solutions for customers to grow
          their applications or businesses.
       
          Compute Offerings. Our compute offerings provide “simplicity with
          choice” so that developers can build and release scalable applications
          faster in the cloud. We provide flexible server configurations sized
          for any
       
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          application, attractive price-to-performance and highly predictable
          pricing that is the same across regions and usage volumes. Our current
          compute offerings include:
       
          •
       
          Droplets (Virtual Machines): Developers can spin up the virtual
          machine of their choice in under a minute. We offer basic Droplets and
          Dedicated Droplets, such as general purpose, CPU-optimized,
          memory-optimized or storage-optimized configurations, which provide
          flexibility to build, test, secure and grow any application from
          start-up to scale. Our Droplet offerings continue to represent a
          significant majority of our revenue.
       
          LOGO
       
          While developers love simplicity, they also value choice. With our
          product portfolio, we strive to give our customers the optionality
          they desire. Droplets provide developers with full control over their
          infrastructure, and with our new compute offerings, we manage the
          infrastructure for them, such as Managed Kubernetes and App Platform.
       
          •
       
          Managed Kubernetes and Container Registry: In late 2018, we launched
          our easy-to-use Managed Kubernetes service that provides scalability
          and portability for cloud-native applications. Customers can get
          started at just $10 per month and scale-up and save with our free
          control plane and inexpensive bandwidth. Our Managed Container
          Registry offering lets customers easily store and manage private
          container images for rapid deployment to our Managed Kubernetes
          service. The continued popularity of cloud-native development and the
          Kubernetes ecosystem has made our Managed Kubernetes service one of
          our fastest-growing products.
       
          •
       
          App Platform: App Platform, launched in October 2020, is a PaaS
          offering that allows customers to build, deploy and scale applications
          quickly using a simple, fully-managed solution. We handle the
       
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          infrastructure, application runtimes and dependencies so that
          developers can push code to production in just a few clicks, enabling
          them to deliver applications to market faster and on a global scale.
          We believe that our open source software-based architecture positions
          App Platform well for our core customer base. We also believe that the
          launch of App Platform will allow us to expand into new markets such
          as Function-as-a-Service (FaaS) and Container-as-a-Service (CaaS).
       
          LOGO
       
          Storage Offerings. Our storage solutions allow our customers to store
          and quickly access any amount of data reliably in the cloud. We offer
          several kinds of storage offerings, depending on the customer’s needs,
          including:
       
          •
       
          Spaces (Object Storage): Our object storage with a built-in content
          delivery network (CDN) makes scaling easy, reliable and affordable.
          Our simple and predictable pricing makes this offering very attractive
          compared to established public cloud providers.
       
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          •
       
          Volumes (Block Storage): Our block storage product allows customers to
          add more storage space and mix and match compute and storage to suit
          their database, file storage, application, service, mobile and backup
          needs. This provides supplemental storage beyond the generous local
          solid-state drive (SSD) offered with our compute offerings.
       
          •
       
          Backups: Our automatically-created disk images of Droplets provide
          peace of mind and a sense of security to our customers. Our Backups
          offering allows weekly system-level backups, providing our customers
          with the ability to revert to an older state or create new Droplets.
       
          Networking Offerings. We provide a suite of networking capabilities to
          secure and control the traffic to our customers’ applications. Data
          transfer costs can quickly become a major expense for the developer of
          any reasonably complex cloud application. At DigitalOcean, we provide
          a generous amount of bandwidth with each successive Droplet purchase.
          This bandwidth is pooled for the customer’s account and shared by all
          applications or resources running in their account, which we believe
          is a key differentiator for us in the marketplace. Our key networking
          product offerings include:
       
          •
       
          Cloud Firewalls: Software service that allows customers to quickly
          secure their infrastructure from common vulnerabilities and define
          what services are visible on their infrastructure. Cloud Firewalls are
          free to our customers and are used for staging and production
          deployments of software.
       
          •
       
          Managed Load Balancers: Software service that allows customers to load
          balance traffic to their software applications located on multiple
          Droplets, enabling them to scale their applications and improve
          availability, security and performance across their infrastructure in
          a few clicks with affordable pricing. In late 2020, we launched a new
          version of this product that targets customers with larger-scale
          applications.
       
          •
       
          Virtual Private Cloud (VPC): Private network interface for
          DigitalOcean resources collections. VPC networks provide a more secure
          connection between resources because the network is inaccessible from
          the public internet and other VPC networks, enabling our customers to
          manage their information and data traffic between applications without
          exposure to the public internet. Unlike many cloud providers, a VPC,
          including floating IP addresses, is available at no additional cost to
          our customers.
       
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          Managed Databases. In 2019, we launched our Managed Database solution,
          which provides a fully-managed database. Managed Databases provide our
          customers with the application performance they need without the
          operational demands that come with building and running a database
          server. We currently offer managed offerings for relational databases
          (SQL) such as PostgreSQL & MySQL, as well as in-memory key-value data
          structure stores such as Redis. We plan to offer additional database
          engines starting in 2021.
       
          LOGO
       
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          The Developer Experience
       
          We believe that providing a differentiated developer experience is a
          critical element of our success. To ensure a positive developer
          experience, we provide rich content resources focused on optimizing
          cloud usage, a powerful and easy-to-use interface, and a variety of
          technology tools. This enables our customers to get started on
          DigitalOcean very quickly and easily and seamlessly expand their usage
          of our products and services as their needs evolve and scale. We
          believe this focus on helping our customers onboard and better utilize
          our products and services builds brand loyalty and generates referrals
          by our customers who are strong advocates for DigitalOcean around the
          world.
       
          Our community education website contains thousands of detailed,
          high-quality technical tutorials written, edited and/or updated by our
          editorial team. These tutorials cover a wide range of topics relevant
          to developers, including programming how-tos for specific technical
          hurdles and guidance on the latest techniques to secure their
          computing environment.
       
          We are very proud of our easy-to-use user interface, which enables
          customers to be up and running in the cloud in as little as three
          clicks and in less than a minute. We utilize intuitive application
          programming interfaces (APIs), command line interface (CLI) and
          plugins/integrations which automate interactions with our cloud
          platform. This allows customers to use popular tools like terraform to
          automate infrastructure as code to provision and manage their
          DigitalOcean deployments. All DigitalOcean products come with detailed
          product and technical documentation to help our customers deploy to
          our cloud platform more quickly.
       
          We provide management and collaboration tools to enable our customers
          to monitor and manage both their software and their team. We currently
          offer these tools free of charge to our customers as it drives brand
          loyalty and customer retention across our customer base. Our
          management and collaboration products include:
       
          •
       
          Insights for Monitoring: Provides a turnkey visibility solution to
          seamless infrastructure monitoring. Customers can collect metrics to
          monitor Droplet performance and can receive alerts if infrastructure
          issues arise—with no configuration required.
       
          •
       
          Projects: Allows our customers to organize their DigitalOcean
          resources (including Droplets, Spaces and Managed Load Balancers) into
          groups that fit the way they work. Customers can create projects that
          align with the applications, environments and clients they host on
          DigitalOcean.
       
          •
       
          Teams: Allows customers to securely and efficiently collaborate on
          projects with unlimited users, two-factor authentication and a single
          bill for all projects.
       
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          We operate the DigitalOcean Marketplace, a platform where developers
          can find pre-configured applications and solutions quickly. Our
          Marketplace contains highly curated everyday applications and
          cutting-edge technologies, providing customers access to the most
          efficient tools to build their businesses while removing the time and
          expense of research, configuration and manual setup. We work closely
          with partners to deliver a truly seamless experience for customers,
          creating the ability for developers to deploy thoroughly tested app
          environments with the click of a button on Droplets and Kubernetes
          clusters. More than 150 preconfigured one-click applications are
          available in the Marketplace, including WordPress, LAMP, Docker and
          Plesk, among others.
       
          LOGO
       
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          Our Customers
       
          DigitalOcean was founded to meet the needs of the overlooked developer
          audience that works independently, at start-ups and within SMBs. Our
          customer base is incredibly diverse and includes:
       
          •
       
          Individuals running their personal web projects and learning cloud
          computing and modern technologies, whether it be programming
          languages, application frameworks or open source technologies
       
          •
       
          Start-ups and SMBs creating SaaS applications across numerous industry
          verticals, including education, finance, advertising, e-commerce,
          media, gaming and many more
       
          •
       
          Start-ups and SMBs providing customer relationship management (CRM)
          products, developer tools, API services and technology products and
          services
       
          •
       
          Managed hosting companies providing value-added services on top of our
          platform to their customers, including maintenance and control of
          servers, managing websites and operating content management systems
          (CMS)
       
          •
       
          Web development agencies building custom websites and projects for
          their clients
       
          Since DigitalOcean provides products across the spectrum—from
          infrastructure to fully-managed PaaS—we are able to serve users of all
          technical skill levels, including system administrators, backend
          developers, frontend developers and DevOps practitioners, among
          others. Increasingly we are also seeing a trend where people without a
          traditional software development background are able to utilize our
          services for compute intensive workloads such as data analytics, video
          conferencing systems, and popular online gaming servers. Additionally,
          our marketplace offers a rich set of pre-configured applications that
          allow non-developers to simply start using popular open source
          software without worrying about infrastructure configuration.
       
          Our customer base is global, and we have historically generated a
          majority of our revenue outside of the United States. The map below
          represents in blue every country in which we had a customer during
          2020.
       
          LOGO
       
          Red = Countries and territories subject to U.S. government
          comprehensive sanctions programs.
       
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          We have been very successful in increasing our customer base and ARPU
          as we expand our product portfolio and optimize our sales, marketing
          and customer success and support initiatives. We had approximately
          573,000 customers as of December 31, 2020, up from approximately
          502,000 as of December 31, 2018. Our ARPU has increased significantly,
          from $35.97 in 2018 to $40.16 in 2019 to $47.78 in 2020.
       
          We have no material customer concentration, as our top 25 customers
          made up 11%, 10% and 9% of our revenue in 2018, 2019 and 2020,
          respectively.
       
          Customer Case Studies
       
          The examples below illustrate how and why companies of varying sizes
          and from different industries and countries around the world use
          DigitalOcean.
       
          Rockerbox
       
          Start date: 2013
       
          Location: United States
       
          Rockerbox is a marketing analytics platform that helps businesses
          aggregate and understand marketing and conversion data, enabling them
          to make better decisions about their marketing strategies and improve
          conversion.
       
          Situation: Rockerbox needed to build a reliable infrastructure that
          could power the marketing operations for hundreds of
          direct-to-consumer brands and businesses.
       
          Solution: In 2013, Rockerbox began hosting a few servers on
          DigitalOcean due to DigitalOcean’s ability to offer powerful,
          cost-effective virtual machines and bandwidth capable of processing
          large amounts of data. The efficiency of DigitalOcean’s solution and
          its API flexibility allowed Rockerbox to run its own container cluster
          on top of Droplets. Rockerbox has expanded its usage of DigitalOcean’s
          platform over time and currently uses Spaces for object storage, Load
          Balancers, Volumes for block storage and the Managed Kubernetes
          offering.
       
          “With DigitalOcean, we have been able to make scaling the technical
          infrastructure of our business highly efficient. DigitalOcean provides
          just the right set of cloud services to run our business and we
          utilize almost every product they offer.”
       
          Rick O’Toole, Cofounder & CTO of Rockerbox
       
          Jiji
       
          Start date: 2014
       
          Location: Nigeria
       
          Jiji.ng is one of the biggest online marketplace platforms in Africa
          serving over 200 million buyers and sellers across 5 countries,
          including Nigeria, Ghana, Uganda, Tanzania and Kenya.
       
          Situation: As Jiji’s online marketplace rapidly grew, the company
          needed to find a modern cloud platform to help serve its users
          reliably and efficiently, something the local hosting providers could
          not guarantee.
       
          Solution: The recommendation for Jiji to deploy DigitalOcean came from
          the company’s developers who had previously used Droplets for their
          own personal projects. By using the DigitalOcean API and other open
          source tools, Jiji is able to automate its infrastructure provisioning
          process giving the company a high degree of control on its usage. With
          the introduction of new Droplet types, Jiji has also been able to move
          some of its bigger workloads to CPU-optimized and memory-optimized
          Droplets, improving page rendering and response times across its
          website by 25%.
       
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          “How quickly we can turn a product idea into a shipping feature is
          what determines our success. We feel the DigitalOcean cloud allows us
          to do just that. As a longtime customer, we feel the interactions we
          have with DigitalOcean - whether product or humans - are consistent
          and valuable. In our experience the customer has always been a
          priority and the experience is a striking difference to anything else
          we have seen in the market.”
       
          Nick Zorin, Founder and CEO of Jiji
       
          RouteTrust
       
          Start date: 2014
       
          Location: United States
       
          RouteTrust is a state-of-the-art telecommunications platform that
          processes billions of voice calls each month and helps
          telecommunications providers simplify their operations to increase
          efficiency and profitability.
       
          Situation: RouteTrust initially invested in its own servers for
          running its voice over internet protocol (VoIP) system, but it soon
          discovered this was not a scalable solution and that it needed a cloud
          provider. The company prioritized exceptional network performance and
          reliable, transparent pricing.
       
          Solution: RouteTrust selected DigitalOcean as the best cloud provider
          to meet its requirements, including standard Droplets that came with
          generous bandwidth. RouteTrust saves hundreds of thousands of dollars
          per year by partnering with DigitalOcean instead of using a larger
          public cloud provider. Today, RouteTrust has shifted all of its
          workloads to the cloud and expanded its usage to hundreds of Droplets
          on DigitalOcean. RouteTrust takes full advantage of DigitalOcean’s
          global footprint to create a geo-redundant voice network, using
          multiple locations in New York and San Francisco.
       
          “We’re a small company and are focused on operating efficiently. We
          found that if we were to run on other clouds, we wouldn’t be able to
          compete in certain products. DigitalOcean has not only provided a
          viable platform to run our business, but exceeded our expectations for
          network performance, which is critical for our business.”
       
          David Shifley, CTO of RouteTrust
       
          Cloudways
       
          Start date: 2014
       
          Location: Malta
       
          Cloudways is a managed hosting platform that allows its customers to
          build powerful websites on the cloud without having to worry about web
          hosting complexity and support issues.
       
          Situation: Cloudways identified that multiple agencies and web
          development companies employed developers who were experts in website
          development, but did not have knowledge of infrastructure management.
          Cloudways needed to find an infrastructure partner that developers
          love and has a strong presence in the developer community.
       
          Solution: While Cloudways allows its customers to build websites using
          any cloud provider, DigitalOcean has become Cloudways’ largest partner
          and is now its preferred cloud provider. Cloudways’ customers choose
          DigitalOcean due to its high performance, reliability and the strength
          of DigitalOcean’s brand in the developer and hosting communities.
          Today, Cloudways’ customers serve more than 250,000 websites on
          DigitalOcean infrastructure.
       
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          “Cloudways needed a different cloud provider in order to reach a
          larger number of SMBs and we found a perfect partner in DigitalOcean.
          They pioneered simplicity and predictability in the cloud space and
          their price-performance ratio and reliability are unmatched.”
       
          Aaqib Gadit, Cofounder & CEO of Cloudways
       
          Parabol
       
          Start date: 2016
       
          Location: United States
       
          Parabol is a remote meeting platform for teams embracing agile
          practices, making it easy for teams to host planning sessions, scrums
          and meetings online.
       
          Situation: With the COVID-19 pandemic accelerating the business
          world’s shift online and to digital meetings, Parabol saw weekly
          customer sign-ups increase by more than ten times. The company needed
          to rearchitect its infrastructure solution to keep up with
          unprecedented demand.
       
          Solution: Parabol chose DigitalOcean because it wanted an easy-to-use
          infrastructure cloud offering. Parabol’s initial use case included
          running a self-hosted open source PaaS (Platform as a Service)
          solution on Droplets. As consumer preferences changed and demand
          increased significantly, Parabol was able to quickly and easily
          redesign its infrastructure setup to allow for greater scale using
          additional DigitalOcean Droplets and the Managed Databases offering.
          This allowed Parabol to move from hosting approximately 10,000
          simultaneous sessions to several hundred thousand without disruption.
       
          “As a founder, I didn’t want to spend time micromanaging
          infrastructure and doing XML sit-ups. When the pandemic happened and
          traffic grew tenfold, the robust DigitalOcean platform allowed us to
          scale seamlessly, without any disruption to our operations, so we
          could continue to focus on running our business.”
       
          Jordan Husney, Cofounder & CEO of Parabol
       
          Bunnyshell
       
          Start date: 2018
       
          Location: Romania
       
          Bunnyshell provides a self-service infrastructure automation platform
          to deploy, scale, and optimize applications.
       
          Situation: Bunnyshell’s mission is to allow developers to focus on
          building applications without worrying about infrastructure. It offers
          cloud-agnostic infrastructure management and application management,
          as well as DevOps tools for deployment and monitoring. Bunnyshell was
          looking for an infrastructure provider that allowed it to provide
          reliable services to its customers in a cost-effective manner.
       
          Solution: Bunnyshell joined the DigitalOcean startup program Hatch and
          built autoscaling, monitoring and DevOps services wrapped around the
          DigitalOcean cloud. DigitalOcean’s excellent price-performance along
          with the extensive API allows Bunnyshell to automate all of its
          infrastructure operations. Since graduating from the Hatch program,
          Bunnyshell has continued to grow its usage of DigitalOcean and has
          referred several customers looking for infrastructure management
          services to DigitalOcean. Bunnyshell now serves hundreds of customers
          ranging from simple WordPress sites to massive e-commerce sites and
          SaaS applications, all running on DigitalOcean infrastructure.
       
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          “What we really like about DigitalOcean is the keen customer focus. As
          a company that serves developers, we want a partner that understands
          our customers and has a shared purpose. DigitalOcean not only provides
          world-class infrastructure but they truly get developers. This makes
          our job easier in terms of building management services for them.”
       
          Roxana Ciobanu, CTO of BunnyShell
       
          Intricately
       
          Start date: 2014
       
          Location: United States
       
          Intricately’s insights power prioritization and propensity models for
          many of the leading vendors across the cloud ecosystem. The company’s
          data platform provides detailed visibility and insights into cloud
          product adoption for more than six million businesses globally,
          enabling its customers to receive proactive notification of sales
          cycles, identify churn before it happens and more.
       
          Situation: Intricately had to build and maintain a distributed
          software system that monitors global digital infrastructure usage,
          collects data from multiple locations worldwide in real-time, and then
          processes that data into actionable insights for sales and marketing
          teams.
       
          Solution: Data collection, processing and storage with high
          performance and reliability is critical to Intricately’s business. The
          combination of DigitalOcean’s simplicity, performance and dedicated
          customer support made it the ideal solution for building and
          maintaining its platform. DigitalOcean’s global footprint allowed
          Intricately to launch and scale a distributed system that runs
          multiple open source solutions like PostgreSQL, Elasticsearch and
          MongoDB, all from DigitalOcean Droplets to maintain and grow its
          applications.
       
          “We set out to build the Google Maps for digital infrastructure - an
          authoritative source of information on cloud adoption. Because we are
          a team of software engineers, we require a developer-friendly
          infrastructure platform that keeps us focused on building software
          rather than managing infrastructure. DigitalOcean’s frictionless
          provisioning, APIs and world class customer support means we can do
          just that. DigitalOcean is a key part of Intricately’s infrastructure
          and we could not be happier with the decision to choose DigitalOcean.”
       
          Fima Leshinsky, CTO of Intricately
       
          Whatfix
       
          Start date: 2016
       
          Location: India
       
          Whatfix is an enterprise SaaS provider that offers a digital adoption
          platform to businesses. The company helps enterprises gain the full
          value of their investments in enterprise applications by providing
          real-time, interactive and contextual guidance to users of those
          applications.
       
          Situation: Whatfix identified that the majority of enterprise
          applications were underutilized in most businesses. It set out to fix
          this problem by creating a SaaS product to provide interactive
          step-by-step walkthroughs within the context of enterprise
          applications. This meant building integrations with top SaaS
          applications globally while fulfilling the security requirements of
          large customers.
       
          Solution: The Whatfix team has a strong infrastructure operations
          background and the company has a preference for managing and running
          its own infrastructure. Whatfix chose DigitalOcean because it provided
          a balance of ease of use and control. It utilizes DigitalOcean
          Droplets to run many open source solutions. Over time, Whatfix has
          also significantly expanded its usage of Volumes for block storage to
          store its increasingly growing data. Today, Whatfix’s solution uses
          almost all of DigitalOcean’s compute resource options, including the
          recently released memory-optimized Droplets.
       
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          “What we really love about the DigitalOcean platform is the ease of
          use. We feel like we know infrastructure and can handle most of the
          configuration and management. What we needed from a cloud was not
          bells and whistles but efficiency and reliability. DigitalOcean
          provides us a platform to build our apps and then gets out of the way.
          Just how we like it.”
       
          Achyuth Krishna, Director of Engineering of Whatfix
       
          Scraper API
       
          Start date: 2019
       
          Location: United States
       
          Scraper API provides developers an easy way to build applications that
          require a lot of online data by scraping internet properties.
          Businesses such as e-commerce, travel and fintech companies utilize
          Scraper API instead of spending on the infrastructure, IP addresses,
          automation and other costs that would otherwise be required to collect
          large amounts of online data.
       
          Situation: Scraper API was looking for a cloud provider that had a
          simple but powerful infrastructure product built to scale.
       
          Solution: Scraper API picked DigitalOcean as it met the company’s
          requirements around simplicity and scalability. The initial solution
          consisted of running the Scraper API app on Droplets, but it soon
          moved to the Managed Kubernetes service. Since then, Scraper API has
          been able to create a system that scales on demand and handles more
          than seven billion requests per month. The company has also moved some
          of its internal services to a microservices based architecture and is
          using DigitalOcean’s new App Platform product.
       
          “We are thoroughly impressed by how robust the DigitalOcean products
          are – both Managed Kubernetes and the general platform. It’s almost
          impossible to take down. We inadvertently pushed a bug into our
          production system but the platform was resilient enough to handle it
          without causing any service disruption. We are so satisfied with the
          platform that our holding company is planning to bring all
          applications from their portfolio companies to DigitalOcean.”
       
          Zoltan Bettenbuk, CTO of Scraper API
       
          Crowd Content
       
          Start date: 2013
       
          Location: Canada
       
          Crowd Content provides a digital marketplace where businesses can find
          and hire talented writers to produce the content the company needs,
          including blog posts, newsletters, product descriptions and social
          media posts.
       
          Situation: Crowd Content’s web traffic fluctuates significantly based
          on the content needs of its customers. The company needed to find an
          infrastructure solution that would be flexible enough to respond to
          these spikes, while operating efficiently.
       
          Solution: Crowd Content’s initial solution consisted of Droplets,
          Volumes for block storage and Spaces for object storage, along with
          multiple open source solutions. The company was immediately able to
          see the benefits of using DigitalOcean, including the ability to
          effortlessly scale on demand and remain agile. Today, approximately
          95% of Crowd Content infrastructure is hosted on DigitalOcean. Since
          it started, Crowd Content has seen a 240% increase in the number of
          customers. Utilizing optimized Droplets has also allowed Crowd Content
          to improve page loading speeds by 20%, which has been critical to
          growing its pool of writers by more than tenfold.
       
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          “As with any online marketplace, traffic to Crowd Content can
          fluctuate widely, and this necessitates easily scalable
          infrastructure. Thanks in large part to DigitalOcean’s broad product
          offering, seamless integration with other services and overall ease of
          use, we’ve been able to build and maintain a platform that’s always
          ready to meet the needs of our customers and writers.”
       
          Eric Hoppe, Director of Marketing of Crowd Content
       
          Vidazoo
       
          Start date: 2014
       
          Location: Israel
       
          Vidazoo is an advertising technology company specializing in video
          streaming and serving. It serves video ads to thousands of websites
          and handles close to 10 billion requests per day.
       
          Situation: Vidazoo specializes in video, advertising and data
          processing and wanted to focus its efforts on building products and
          features that delighted its customers. After Vidazoo worked and tested
          several options, it contacted DigitalOcean to find an optimal and
          custom solution to manage its cloud infrastructure and meet its
          performance needs.
       
          Solution: Vidazoo came to DigitalOcean because it was consistent with
          the company’s “use the best tool for the job” philosophy. Vidazoo
          proceeded to build a cloud-native solution by using multiple managed
          cloud services instead of building everything itself. DigitalOcean
          formed the core compute engine for this solution, and Vidazoo built a
          Platform-as-a-Service (PaaS) layer on top of DigitalOcean Droplets for
          various kinds of processing, ad-serving and rendering. The company has
          also begun to move many of its CPU-intensive processing jobs, such as
          video transcoding, to DigitalOcean’s App Platform.
       
          “We are as much a data company as an adtech company. Our business
          relies on speedy and accurate data processing at massive scale.
          DigitalOcean provides us the perfect set of tools to operate our SaaS
          business profitably, while not making us feel the need to become full
          time system administrators. We plan to move a lot of our apps to
          DigitalOcean App Platform and other fully managed products.”
       
          Roman Svichar, CTO of Vidazoo
       
          Centra
       
          Start date: 2017
       
          Location: Sweden
       
          Centra is a SaaS-based e-commerce platform for global
          direct-to-consumer and wholesale e-commerce brands. Centra provides a
          powerful e-commerce backend that lets brands build pixel-perfect,
          custom designed, online flagship stores.
       
          Situation: Centra provides business critical software that powers
          global e-commerce operations for industry leading fashion and
          lifestyle brands. It was looking for a cloud infrastructure that could
          meet its needs of reliability, scalability and predictable pricing.
       
          Solution: Centra found the reliable and efficient hosting partner it
          needed with DigitalOcean. The company’s developers leverage
          DigitalOcean’s intuitive and user-friendly cloud experience to allow
          it to focus on building its platform and growing its business.
          DigitalOcean’s scalable, transparent solution has proven to be
          sufficiently robust and flexible to scale along with Centra’s demand,
          which surges significantly during high demand peak periods such as
          Black Friday, flash sales and large campaigns. Even with Centra’s
          rapid growth and the increasing demand of Centra’s clients, the
          company has been able to effortlessly scale capacity and meet that
          demand with DigitalOcean.
       
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          “How do we enable our customers to create differentiated online
          experiences? How do we ensure their e-commerce apps stay up and
          running at all times? How do we scale on-demand when traffic grows or
          new customers come in? These are the questions that we ask ourselves
          everyday. Thankfully, we have a partner in DigitalOcean that provides
          just the platform to answer those questions enabling us to guarantee
          99.9% uptime for our clients.”
       
          Martin Jensen, CEO of Centra
       
          Vidgyor
       
          Start date: 2017
       
          Location: India
       
          Vidgyor provides an adtech platform that leverages machine learning to
          boost ad revenues for TV broadcasters and OTT (over-the-top)
          platforms.
       
          Situation: Vidgyor wanted to find a cloud platform that allowed it to
          experiment and iterate quickly on feature ideas. It wanted an
          infrastructure platform that could easily scale, handle increasing
          network bandwidth demands and did not require committing to huge costs
          on infrastructure.
       
          Solution: DigitalOcean provided a platform that allowed Vidgyor to
          move fast and scale. The provision-on-demand flexibility, variety of
          virtual machine options and leading bandwidth price-performance were a
          perfect fit for its network intensive applications, allowing it to
          build rapidly and scale with its customers. Live video streaming and
          syndication as well as the performance of machine learning algorithms
          have also benefited from the new optimized Droplet types.
       
          “For us the most important thing was to turn our idea of an
          AI-assisted ad platform into reality and do so quickly and profitably.
          DigitalOcean helped us do that. We love the developer experience, we
          can accurately predict our costs, and can scale up or down as the
          traffic grows. This has been a huge benefit especially during the
          pandemic when usage of OTT services and hence our platform grew
          significantly.”
       
          Mahaboob Khan, Cofounder and CEO of Vidgyor
       
          Our Community
       
          We focus heavily on building a large highly engaged community that can
          connect and educate developers across the globe. Our developer
          community enables students, hobbyists and experienced developers alike
          the tools to learn new skills and technologies and create and deliver
          new applications.
       
          The DigitalOcean community is based on forging genuine relationships
          through a series of meaningful and memorable interactions. We foster
          our community through numerous initiatives, and believe these
          initiatives drive brand loyalty amongst a fast-growing developer
          community. We also believe that our focus on community engagement
          spurs our community followers to become advocates for us and our
          platform.
       
          Our community efforts are focused on educating, engaging and
          connecting the global developer and entrepreneurial communities, and
          can be grouped into three key categories:
       
          •
       
          Education: We operate a community education website which has grown
          significantly over the past few years, and attracts approximately
          3.5 million monthly unique visitors. We offer approximately 6,000
          high-quality technical tutorials and a forum with more than 28,000
          questions and answers that guide developers in creating and delivering
          modern applications—not just focused on DigitalOcean products and
          services, but relevant to any cloud service. Our approach of giving
          back to the community “more than you receive” helps drive strong brand
          loyalty for DigitalOcean across the global developer community.
       
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          •
       
          Events & Sponsorships: We support community learning, networking and
          interaction via targeted industry and customer events, as well as well
          as technical talks, regional events (which we call Tide conferences)
          and a virtual 24-hour conference (which we call Deploy). We have
          hosted Tide conferences in the U.S, India and Europe over the past
          several years and our first Deploy conference was held virtually in
          November 2020. In addition to these events, we honor and strengthen
          our commitment to the open source community via sponsorships that
          empower aspiring and evolving developers. Each year we host
          Hacktoberfest, which we believe is the largest hackathon in the world,
          with approximately 170,000 developers participating in 2020. We
          distribute our regular Currents market surveys to anyone who seeks
          market research trends about cloud and open source developments,
          whether they are a DigitalOcean customer or not.
       
          •
       
          Start-up Enablement: We also support entrepreneurs and start-ups more
          directly as they begin their journey. We operate the “Hatch by
          DigitalOcean” program, which furnishes high-potential start-ups with a
          robust set of benefits to help them succeed. We partner with some of
          the most prominent start-up incubators in the world and also accept
          direct applications to the Hatch program. The benefits we provide our
          Hatch companies include free infrastructure products and services,
          free technical support, and membership in our Hatch community that
          allows founders to collaborate and share learnings. Many of our Hatch
          participants graduate from the program and become loyal DigitalOcean
          customers.
       
          Marketing & Sales
       
          Our marketing and sales teams work together closely to drive awareness
          and adoption of our platform, accelerate customer acquisition and
          expand our revenue from existing customers. We believe we have built
          an incredibly efficient customer acquisition and expansion model. For
          the years ended December 31, 2018, 2019 and 2020, our sales and
          marketing expense as a percentage of revenue was approximately 14%,
          12% and 11%, respectively.
       
          We have historically generated almost all of our revenue from our
          efficient self-service marketing model, which enables customers to get
          started on our platform very quickly and without the need for
          assistance. We focus heavily on enabling a self-service, low-friction
          model that makes it easy for users to try, adopt and use our products.
          By reducing the friction that typically accompanies the purchase of
          business software and eliminating the need for complicated and costly
          implementation and training, we have grown our customer base while
          avoiding the expensive customer acquisition costs typical of
          high-touch enterprise sales models.
       
          Our approach focuses on the self-service revenue funnel where we
          attract, convert and retain customers. By creating an intentional
          marketing experience for a prospect to travel through different stages
          of the funnel, we are able to anticipate their needs in real-time at
          each step. We attract visitors to our website through a combination of
          high-quality content, developer outreach and highly-targeted paid
          demand generation campaigns. We monitor and measure monthly unique
          visitors to our website based on the number of devices, such as a
          browser or a terminal, for which a unique and anonymous identifier
          (typically a first-party cookie) is sent with respect to each visit to
          our website in a given month. We convert those visitors to paying
          customers through website optimizations and experimentation. For
          existing customers, we conduct a variety of campaign strategies to
          ensure we retain and expand those customers. Our marketing department
          is broken into three distinct areas: revenue marketing, which is
          responsible for generating self-service revenue through management of
          the funnel; product/programs marketing, which is responsible for
          marketing our products, developer relations and community engagement;
          and content, which is responsible for managing the community and
          editorial teams.
       
          We complement our efficient self-service customer acquisition model
          with a small, targeted inside sales team that is focused on responding
          to inbound inquiries, outbound prospecting targeting specific use
          cases, volume expansion of our self-service customers and expanding
          our revenue in specific international markets. We utilize a
          process-oriented and data-driven approach to sales that includes
          tracking numerous metrics such as sales
       
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          conversion rates, velocity and time-to-close, and size of sales
          pipeline. Our sales team includes experienced sales engineers who
          fashion technical solutions for customers to convert their workloads
          from other cloud providers.
       
          We intend to continue to invest in our marketing and sales
          capabilities to capitalize on our large and global market opportunity,
          while remaining very efficient in terms of marketing and sales expense
          as a percentage of revenue.
       
          Our Customer Support and Service
       
          Providing unparalleled customer support has been a passion and
          priority since our founding, and we believe it is a strategic
          differentiator for us. Our goal is to help all of our customers
          achieve their objectives—whether they are an individual developer
          working on a personal project or an SMB launching a sophisticated new
          application. Customers cite our attentive support focus as a key
          driver of their decision to start and grow their business on our
          platform.
       
          Our customer success and support team is organized into two main
          teams: customer support and customer success. These teams provide 24x7
          service and are also stationed in various time zones to provide
          uninterrupted support to our truly global customer base.
       
          The customer support team addresses account-related questions and
          provides high-quality technical advice and troubleshooting. Developers
          and engineers are a key part of the customer support team, and our
          technical support is—and always has been—available free of charge to
          all customers. The customer engagement with this customer support team
          also serves as an important feedback loop to our product and
          technology teams, helping us better understand the specific needs of
          individual developers and SMBs. This feedback has influenced, and will
          continue to influence, our product roadmap, the content strategy for
          our community tutorials and other business decisions.
       
          Once our customers reach a certain spending level with us, we support
          them with dedicated customer success advocates to ensure their
          satisfaction and expand their usage of our platform. Our customer
          success professionals focus on customer retention and customer
          expansion by adding value throughout the customer lifecycle as
          customers scale and expand their usage of our product portfolio. For
          example, if a customer supplements their Droplets usage and initiates
          a Managed Database, our automated data science tool triggers an
          internal notification to our customer success advocates. In turn, a
          customer success advocate will directly contact the customer to
          determine if there are ways for us to augment their database with an
          additional service such as Managed Kubernetes.
       
          We closely track various metrics to ensure we are providing
          exceptional customer support. Our NPS, which we measure by conducting
          a randomized survey of our paid customers in which customers could
          respond with a rating of 0 to 10 regarding their willingness to
          recommend us, averaged 65 during 2020. This NPS score is comparable to
          some of the world’s most beloved brands. We also internally monitor a
          separate customer satisfaction rating to gauge the quality of our
          interactions with customers and our ability to increase loyalty. We
          also have specific monthly service-level objectives (SLOs) for
          response and resolution times to ensure we maintain a high level of
          customer satisfaction.
       
          Our customer support and success team was recently recognized by The
          Stevie Awards for Sales & Customer Service with a gold “Customer
          Service Team of the Year” Stevie Award for recovery situations and
          four silver Stevie Awards for customer satisfaction strategy, support
          team and support leadership.
       
          Competition
       
          The markets that we serve are highly competitive and rapidly evolving.
          With the introduction of new technologies and innovations, we expect
          the competitive environment to remain intense.
       
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          We believe that the principal factors on which we compete include:
       
          •
       
          ease of use and operation;
       
          •
       
          speed of deployment;
       
          •
       
          price, total cost of ownership and transparency;
       
          •
       
          customer experience, support and service;
       
          •
       
          community engagement and education;
       
          •
       
          features, functionality and quality of tools;
       
          •
       
          performance, reliability, scalability and security;
       
          •
       
          brand awareness and reputation;
       
          •
       
          geographic reach; and
       
          •
       
          open source support.
       
          We compete primarily with large, diversified technology companies that
          focus on large enterprise customers and provide cloud computing as
          just a portion of the products and services that they offer. The
          primary vendors in this category include Amazon (AWS), Microsoft
          (Azure), Google (GCP), IBM and Oracle. These competitors are large,
          well-known public companies with greater financial, technical, and
          sales and marketing resources, and they possess considerably more
          customer awareness than we do.
       
          We also compete with smaller and/or niche cloud service providers that
          typically target individuals and smaller businesses, simple use cases
          and/or narrower geographic markets. Examples in this category include
          OVH, Vultr, Heroku and Linode.
       
          Despite the competitive intensity, we believe we compete successfully
          on the basis of the factors listed above. We focus solely on solutions
          for individual developers, start-ups and SMBs—and combine the power of
          simplicity, love for the developer community, an obsession for
          customer service and the advantages of open source. This
          differentiates us dramatically from the enterprise cloud competitors.
          At the same time, our ability to address complex use cases that allows
          customers to scale with us as they grow differentiates us from the
          many niche competitors whose have less robust and extensible
          offerings.
       
          Intellectual Property
       
          Intellectual property rights are important to the success of our
          business. We rely on a combination of trademark, patent, copyright and
          trade secret laws in the United States and other jurisdictions, as
          well as license agreements, confidentiality provision, non-disclosure
          agreements with third parties and other contractual protections, to
          protect our intellectual property rights, including our proprietary
          technology, software, know-how and brand. We use open source software
          in our services.
       
          As of December 31, 2020, we owned six registered trademarks in the
          United States and four registered trademarks in various non-U.S.
          jurisdictions. We have filed applications for registration of an
          additional three trademarks in the United States and seven in various
          non-U.S. jurisdictions, as well as one World Intellectual Property
          Organization international trademark application, which could extend
          the registration of one of our trademarks to ten additional
          jurisdictions. All of the foregoing applications were pending as of
          December 31, 2020. As we further expand
       
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          internationally, we may be unable to register or obtain the right to
          use the DigitalOcean trademark in certain jurisdictions. As of
          December 31, 2020, we had filed one patent application pending for
          examination in the United States and a related non-U.S. patent
          application. The pending U.S. patent application, if issued, would be
          scheduled to expire in September 2039. In addition, we license
          third-party software and use open source software and other
          technologies that are used in the provision of or incorporated into
          some elements of our services. Many parts of our business utilize
          proprietary technology and/or licensed technology, including open
          source software.
       
          We control access to and use of our proprietary technology and other
          confidential information through the use of internal and external
          controls, including contractual protections with employees,
          contractors, customers, vendors and partners. Our policy is to require
          all employees and independent contractors to sign agreements assigning
          to us any inventions, trade secrets, works of authorship,
          developments, processes and other intellectual property generated by
          them on our behalf and under which they agree to protect our
          confidential information. In addition, we generally enter into
          confidentiality agreements with our customers, vendors and other
          partners. Our use of open source software, and participation in open
          source projects, may also limit our ability to assert certain of our
          intellectual property and proprietary rights against third parties,
          including competitors, who access or use software or technology that
          we have contributed to such open source projects. See the section
          titled “Risk Factors” for a more comprehensive description of risks
          related to our intellectual property, including our use of open source
          software.
       
          Although we rely on a variety of intellectual property protections, we
          believe that factors such as the technological and creative skills of
          our personnel, our ability to create new products services, and
          enhance the features and functionality for our offerings, are more
          essential to establishing and maintaining our technology leadership
          position.
       
          Employees and Human Capital
       
          We are focused on attracting, developing and retaining top talent to
          help drive the growth of our business. We have a strong commitment to
          building a diverse workforce that reflects our values and the needs of
          our global customer base.
       
          Since our inception, we have fostered a remote-friendly work culture
          that enables us to recruit and retain skilled professionals wherever
          they are located. In recent years, our remote workforce represented a
          majority of our total employee base and an even higher percentage
          across our technology personnel. Since March 2020, our entire
          workforce has operated remotely and our history and experience with
          managing a remote workforce has allowed us to continue to operate
          effectively and without interruption during the COVID-19 pandemic.
       
          As of December 31, 2020, we had 581 employees, with 466 based in the
          United States and an additional 115 located in four other countries.
          None of our employees are represented by a labor union with respect to
          his or her employment. We have not experienced any work stoppages and
          we consider our relations with our employees to be good.
       
          Our Facilities
       
          Our headquarters is located in New York City, where we lease
          approximately 44,000 square feet. Our lease for this space will expire
          in July 2025. Additionally, we lease approximately 7,200 square feet
          in office space in Cambridge, Massachusetts. We have also entered into
          short-term leases for small spaces in a number of co-working
          locations. We also lease space in 14 data centers worldwide, including
          in the United States, India, Germany, the United Kingdom, Canada, the
          Netherlands and Singapore. We do not own any real property. We believe
          that our current facilities are adequate to meet our current needs and
          that additional or substitute space is available if needed to
          accommodate growth and expansion.
       
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          Legal Proceedings
       
          From time to time, we are involved in various legal proceedings
          arising from the normal course of business activities. We are not
          presently a party to any litigation the outcome of which, if
          determined adversely to us, would in our estimation, have a material
          adverse effect on our business, operating results, cash flows or
          financial condition. Defending such proceedings is costly and can
          impose a significant burden on management and employees. The results
          of any current or future litigation cannot be predicted with
          certainty, and regardless of the outcome, litigation can have an
          adverse impact on us because of defense and settlement costs,
          diversion of management resources and other factors.
       
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          MANAGEMENT
       
          The following table sets forth information for our executive officers
          and directors as of February 25, 2021:
       
          Name
       
          Age
       
          Position
       
          Executive Officers:
       
          Yancey Spruill
       
          53
       
          Chief Executive Officer and Director
       
          William Sorenson
       
          65
       
          Chief Financial Officer
       
          Carly Brantz
       
          42
       
          Chief Marketing Officer
       
          Barry Cooks
       
          49
       
          Chief Technology Officer
       
          Jeffrey Guy
       
          55
       
          Chief Operating Officer
       
          Matthew Norman
       
          48
       
          Chief People Officer
       
          Alan Shapiro
       
          52
       
          General Counsel
       
          Non-Employee Directors:
       
          Warren Adelman
       
          57
       
          Director
       
          Pratima Arora
       
          41
       
          Director
       
          Amy Butte
       
          53
       
          Director
       
          Warren Jenson
       
          64
       
          Director
       
          Pueo Keffer
       
          39
       
          Director
       
          Peter Levine
       
          60
       
          Director
       
          Hilary Schneider
       
          59
       
          Director
       
          Executive Officers
       
          Yancey Spruill has served as our Chief Executive Officer and a member
          of our Board since August 2019. Prior to DigitalOcean, Mr. Spruill
          served as the Chief Operating Officer and Chief Financial Officer of
          SendGrid, Inc., a customer communication platform for transactional
          and marketing email, from June 2015 until its acquisition by Twilio,
          Inc. in February 2019. From September 2014 to June 2015, Mr. Spruill
          served as Chief Financial Officer at TwentyEighty, Inc., a provider of
          training and performance improvement solutions. From August 2004 to
          September 2014, Mr. Spruill served as Executive Vice President and
          Chief Financial Officer at DigitalGlobe, Inc., a provider of
          geospatial information products and services. Mr. Spruill currently
          serves on the board of directors of Ping Identity Corporation, a
          provider of cloud identity security solutions, where he is Chairman of
          the Audit Committee. Mr. Spruill previously served on the board of
          directors of Allscripts Healthcare Solutions, Inc., an electronic
          healthcare records technology company from 2016 to 2020, Zayo Group
          Holdings, a provider of telecommunications infrastructure services
          until its sale to a consortium of financial buyers in March 2020, and
          Rally Software Development Corp., a provider of agile development
          software, until its sale to CA in July 2015. Mr. Spruill received a
          B.S. in Electrical Engineering from the Georgia Institute of
          Technology and an M.B.A. from the Amos Tuck School of Business at
          Dartmouth College. We believe Mr. Spruill’s extensive financial
          expertise, leadership experience, experience with serving on boards of
          other technology companies and significant experience in the
          technology industry, as well as his insight into corporate matters as
          our Chief Executive Officer, make him a valuable member of our board
          of directors.
       
          William Sorenson has served as our Chief Financial Officer since
          August 2019. Mr. Sorenson served as Chief Financial Officer at Enel X
          North America, Inc. (formerly Enernoc, Inc.), an intelligent energy
          company, from August 2016 to September 2017. From May 2014 to October
          2015, Mr. Sorenson served as Chief Financial Officer of Acquia Inc., a
          web content management platform provider. From August 2008 to July
          2013, Mr. Sorenson served as Chief Financial Officer of Qlik
          Technologies Inc., a business intelligence solutions provider of
          visual analytics. Previously, Mr. Sorenson held executive level
          positions at EMI Music Publishing, Bertelsmann AG and News
          Corporation. Mr. Sorenson received a B.A. in Foreign Languages from
          LeMoyne College and an M.A. in International Relations from American
          University.
       
          Carly Brantz has served as our Chief Marketing Officer since January
          2020. From July 2011 to January 2020, Ms. Brantz worked at SendGrid,
          Inc. (acquired by Twilio, Inc. in February 2019), a customer
       
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          communication platform for transactional and marketing email, where
          she most recently served as Vice President, Revenue Marketing. From
          2005 through 2011, Ms. Brantz worked at Return Path, Inc., an email
          deliverability and optimization platform for email marketers, where
          she most recently served as the Director of Marketing. Ms. Brantz
          currently serves as a board member for Pledge 1% Colorado, a position
          she has held since January 2018. Ms. Brantz received a B.A. in
          International Business and Marketing from the University of Colorado
          Boulder.
       
          Barry Cooks has served as our Chief Technology Officer since February
          2019. Mr. Cooks served as Vice President of R&D, Cloud Operations
          Products at VMware, Inc., a software company, from March 2016 to
          February 2019, as well as Senior Director of R&D at VMware, Inc. from
          March 2006 to March 2009. Mr. Cooks served as Senior Vice President of
          Products, Engineering and Support at Virtual Instruments Corporation,
          where he worked from March 2009 to March 2016. Previously, Mr. Cooks
          also served as Director of Engineering at Sun Microsystems, Inc.
          Mr. Cooks holds a B.S. in Computer Science from Purdue University and
          an M.S. in Computer Science from the University of Oregon.
       
          Jeffrey Guy has served as our Chief Operating Officer since February
          2020. Mr. Guy served as Vice President of Finance and Transformation
          at Solera, Inc., a data and software services company, from August
          2019 to February 2020. From July 2011 to August 2019, Mr. Guy worked
          at DigitalGlobe, Inc. a provider of geospatial information products
          and services, where he most recently served as Senior Vice President
          of Business Transformation and previously held several senior-level
          finance and operations roles. From 2001 to 2010, Mr. Guy served in
          various operations and transformation roles at Trimble, Inc., a
          hardware, software and services technology company. Mr. Guy received a
          B.S. in Business Administration in Operations and Supply Chain
          Management from Bowling Green State University and an M.B.A. in
          International Business from Western Michigan University.
       
          Matthew Norman has served as our Chief People Officer since May 2020.
          Mr. Norman served as Executive Vice President of Human Resources at
          Denihan Hospitality Group, a hotel management and development company,
          from September 2013 to May 2020. Previously, Mr. Norman was Vice
          President of Human Resources at Gilt Groupe, an online shopping and
          lifestyle website, from June 2011 to September 2013 and Vice President
          of Human Resources at Condé Naste, a global mass media company, from
          March 2010 to June 2011. Mr. Norman has also previously served in
          senior roles in the human resources departments at Universal McCann
          Worldwide, Inc., DoubleClick Inc. and Honeywell International Inc.
          Mr. Norman received a B.A. from Wabash College and a master’s degree
          from Columbia University.
       
          Alan Shapiro has served as our General Counsel since May 2017. From
          November 2007 until December 2016, Mr. Shapiro served in various
          roles, including most recently as Executive Vice President and General
          Counsel, at Everyday Health, Inc., a provider of digital health
          solutions. From September 2002 until October 2007, Mr. Shapiro served
          as General Counsel of NetRatings, Inc., a global Internet media and
          market research firm. From April 2000 until July 2002, Mr. Shapiro
          served as General Counsel of Jupiter Communications, Inc. and its
          successor company, Jupiter Media Metrix, Inc., a provider of Internet
          media and market research services. Previously, Mr. Shapiro worked as
          a corporate attorney at Brobeck, Phleger & Harrison LLP and Dechert
          LLP. Mr. Shapiro received a B.A. from Columbia University and a J.D.
          from the UCLA School of Law.
       
          Non-Employee Directors
       
          Warren Adelman has served as a member of our board of directors since
          November 2020. Mr. Adelman has served as the Managing Director of
          Nativ Group, a personal investment firm, since 2013. Prior to founding
          Nativ Group, Mr. Adelman held a variety of positions at GoDaddy Inc.,
          a publicly traded domain name registrar, from 2003 to 2012, most
          recently serving as Chief Executive Officer. Mr. Adelman also served
          as a member of GoDaddy’s board of directors from 2006 to 2012.
          Mr. Adelman currently serves on the board of directors of several
          technology-related companies. Mr. Adelman also previously served on
          the board of directors of Sendgrid, Inc. from April 2014 until its
          merger with Twilio Inc. in February 2019. Mr. Adelman holds a B.A. in
          Political Science and
       
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          History from the University of Toronto. We believe Mr. Adelman’s
          extensive experience with technology companies as both a director and
          an executive officer qualifies him to serve on our board of directors.
       
          Pratima Arora has served as a member of our board of directors since
          February 2021. Ms. Arora has served as General Manager and Vice
          President of Confluence at Atlassian Corporation Plc, a provider of
          software development and collaboration tools, since September 2017.
          From June 2008 to September 2017, Ms. Arora worked at Salesforce.com,
          Inc., a cloud-based customer relationship management software service,
          where she most recently served as Vice President of Product
          Management. Previously, Ms. Arora worked in various roles at SAP SE,
          an enterprise software management system, and Intuit Inc., a financial
          services software company. Ms. Arora received a B.S. in Physics from
          Sri Venkateswara College, Delhi University and an M.B.A. from the
          Walter A. Haas School of Business at the University of California,
          Berkeley. We believe Ms. Arora’s extensive experience in product
          management roles at technology companies qualifies her to serve on our
          board of directors.
       
          Amy Butte has served as a member of our board of directors since April
          2018. Ms. Butte currently serves on the board of directors of Bain
          Capital Specialty Finance, Inc., a managed specialty finance company,
          and Tuscan Holdings Corp., a special purpose acquisition vehicle.
          Ms. Butte also serves on the board of directors of BNP Paribas USA,
          where she is currently audit committee chair and a member of the risk
          management committee. Ms. Butte is an advisor to several private
          companies, including the Long-Term Stock Exchange, Inc., a startup
          marketplace for long-term investors. Ms. Butte was an independent
          trustee for the Fidelity Investments Strategic Advisors Funds from
          2011 to 2017, a board member for Accion International from 2008 to
          2014 and the founder of TILE Financial, a fintech startup, from 2008
          to 2012. Previously, Ms. Butte served as Chief Financial Officer of
          Man Financial, Inc., Chief Financial Officer and Executive Vice
          President of the New York Stock Exchange, and Chief Financial Officer
          and Strategist for the Financial Services Division of Credit Suisse
          First Boston, Inc. Ms. Butte received a B.A. from Yale University and
          an M.B.A. from Harvard Business School. We believe that Ms. Butte’s
          extensive experience in the financial industry and guiding companies
          through the complexities of maturing from private to public qualifies
          her to serve on our board of directors.
       
          Warren Jenson has served as a member of our board of directors since
          December 2020. Mr. Jenson currently serves as President, Chief
          Financial Officer and Executive Managing Director of International at
          LiveRamp (formerly known as Acxiom), a software-as-a-service company
          that provides industry leading identity and data connectivity
          services. Mr. Jenson has served at LiveRamp/Acxiom since 2012. Prior
          to joining Acxiom, Mr. Jenson served as Chief Operating Officer at
          Silver Spring Networks, a start-up specializing in smart grid network
          technology, from 2008 to 2011. Previously, Mr. Jenson served in
          executive-level positions with Electronic Arts, Inc., Amazon.com,
          Inc., Delta Air Lines and several positions as part of the General
          Electric Company and its affiliates. Mr. Jenson currently serves on
          the board of directors of Cardtronics plc, a leading global provider
          of fully integrated ATM and financial kiosk products and services,
          TapJoy, Inc., a privately-held monetization and distribution services
          provider for mobile applications, and the Marriott School of Business
          at Brigham Young University. Mr. Jenson previously served on the board
          of directors of DigitalGlobe, Inc. Mr. Jenson received a B.S. in
          Accounting and a Master of Accountancy—Business Taxation from Brigham
          Young University. We believe that Mr. Jenson’s extensive experience as
          both a director and an executive officer at several successful public
          and private companies qualifies him to serve on our board of
          directors.
       
          Pueo Keffer has served as a member of our board of directors since
          June 2015. Mr. Keffer has served as a Managing Director at Access
          Technology Ventures, a venture and growth technology firm, since April
          2015. Mr. Keffer was a Partner at Redpoint Ventures, a venture capital
          firm, from January 2009 to April 2015. Previously, Mr. Keffer was an
          associate at TA Associates, a growth private equity firm, and a
          financial analyst at Goldman Sachs & Co. Mr. Keffer also currently
          serves on the board of directors of Opendoor Labs Inc., an operator of
          an online real estate marketplace. Mr. Keffer received a B.A. in
          Economics from Stanford University. We believe that Mr. Keffer’s
          extensive investment experience in the technology industry qualifies
          him to serve on our board of directors.
       
          Peter Levine has served as a member of our board of directors since
          February 2014. Mr. Levine is a General Partner at Andreessen Horowitz,
          a venture capital firm, where he has worked since March 2011. From
          October
       
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          2007 to 2011, he served as Senior Vice President of the Datacenter &
          Cloud Division of Citrix Systems Inc., a multinational software
          company, and from February 2006 until its acquisition by Citrix in
          2007, he served as President and Chief Executive Officer of XenSource,
          Inc. From June 2002 to February 2005, Mr. Levine served as Managing
          Director of Mayfield Fund, a venture capital investment firm.
          Mr. Levine also currently serves on the board of directors of several
          private technology companies. Mr. Levine received a B.S. in
          Engineering from Boston University and attended the Sloan School of
          Management at MIT. We believe that Mr. Levine’s experience as a
          seasoned venture capitalist and a current and former director of many
          software companies qualifies him to serve on our board of directors.
       
          Hilary Schneider has served as a member of our board of directors
          since November 2020. Ms. Schneider has served as the Chief Executive
          Officer of Shutterfly, Inc. since January 2020. From January 2018
          until November 2019, Ms. Schneider served as the Chief Executive
          Officer of Wag Labs, Inc., an on-demand dog walking company.
          Ms. Schneider served as President, Chief Executive Officer and a
          director of LifeLock, Inc., a formerly publicly traded provider of
          identity theft protection, identity risk assessment and fraud
          protection services, from March 2016 to February 2017 and President
          from 2012 to 2016. Previously, Ms. Schneider held senior leadership
          roles at Yahoo!, a global technology company, Knight Ridder, Inc., a
          media company, and Red Herring Communications, a media company.
          Ms. Schneider currently serves on the board of directors of Vail
          Resorts, Inc., a global mountain resort operator, and several private
          companies and non-profit organizations, including Water.org.
          Ms. Schneider previously served on the board of directors of Sendgrid,
          Inc. from July 2017 until its merger with Twilio Inc. in February
          2019. Ms. Schneider holds a B.A. in Economics from Brown University
          and an M.B.A. from Harvard Business School. We believe Ms. Schneider’s
          extensive experience with technology companies as both a director and
          an executive officer qualifies her to serve on our board of directors.
       
          Composition of Our Board of Directors
       
          Our business and affairs are managed under the direction of our board
          of directors. We currently have eight directors. All of our directors
          currently serve on the board of directors pursuant to the provisions
          of a voting agreement between us and several of our stockholders. This
          agreement will terminate upon the closing of this offering, after
          which there will be no further contractual obligations regarding the
          election of our directors. Following the completion of this offering,
          no stockholder will have any special rights regarding the election or
          designation of members of our board of directors. Our current
          directors will continue to serve as directors until their resignation,
          removal or successor is duly elected.
       
          Our board of directors may establish the authorized number of
          directors from time to time by resolution. In accordance with our
          amended and restated certificate of incorporation that will be in
          effect on the completion of this offering, immediately after this
          offering, our board of directors will be divided into three classes
          with staggered three-year terms. At each annual general meeting of
          stockholders, the successors to directors whose terms then expire will
          be elected to serve from the time of election and qualification until
          the third annual meeting following election. Our directors will be
          divided among the three classes as follows:
       
          •
       
          the Class I directors will be Amy Butte, Peter Levine and Yancey
          Spruill whose terms will expire at the annual meeting of stockholders
          to be held in 2022;
       
          •
       
          the Class II directors will be Warren Adelman, Pueo Keffer and Hilary
          Schneider whose terms will expire at the annual meeting of
          stockholders to be held in 2023; and
       
          •
       
          the Class III directors will be Pratima Arora and Warren Jenson whose
          terms will expire at the annual meeting of stockholders to be held in
          2024.
       
          We expect that any additional directorships resulting from an increase
          in the number of directors will be distributed among the three classes
          so that, as nearly as possible, each class will consist of one third
          of the
       
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          directors. The division of our board of directors into three classes
          with staggered three-year terms may delay or prevent a change of our
          management or a change in control.
       
          Director Independence
       
          Our board of directors has undertaken a review of the independence of
          each director. Based on information provided by each director
          concerning her or his background, employment and affiliations, our
          board of directors has determined that none of our directors, other
          than Yancey Spruill, has any relationships that would interfere with
          the exercise of independent judgment in carrying out the
          responsibilities of a director and that each of these directors is
          “independent” as that term is defined under the listing standards of
          the New York Stock Exchange. In making these determinations, our board
          of directors considered the current and prior relationships that each
          non-employee director has with our Company and all other facts and
          circumstances our board of directors deemed relevant in determining
          their independence, including the beneficial ownership of our shares
          by each non-employee director and the transactions described in the
          section titled “Certain Relationships and Related Party Transactions.”
       
          Committees of Our Board of Directors
       
          Our board of directors has established an audit committee, a
          compensation committee and a nominating and corporate governance
          committee. The composition and responsibilities of each of the
          committees of our board of directors are described below. Members
          serve on these committees until their resignation or until otherwise
          determined by our board of directors. Our board of directors may
          establish other committees as it deems necessary or appropriate from
          time to time.
       
          Audit Committee
       
          Our audit committee consists of Warren Adelman, Amy Butte and Warren
          Jenson. The chair of our audit committee is Amy Butte. Our board of
          directors has determined that each member of the audit committee
          (i) satisfies the independence requirements under New York Stock
          Exchange listing standards and Rule 10A-3(b)(1) of the Exchange Act;
          (ii) is an “audit committee financial expert” as defined in
          Item 407(d)(5)(ii) of Regulation S-K promulgated under the Securities
          Act; and (iii) can read and understand fundamental financial
          statements in accordance with applicable requirements. In arriving at
          these determinations, our board of directors has examined each audit
          committee member’s scope of experience and the nature of their
          employment in the corporate finance sector.
       
          The primary purpose of the audit committee is to discharge the
          responsibilities of our board of directors with respect to our
          corporate accounting and financial reporting processes, systems of
          internal control and financial statement audits, and to oversee our
          independent registered public accounting firm. Specific
          responsibilities of our audit committee include:
       
          •
       
          helping our board of directors oversee our corporate accounting and
          financial reporting processes;
       
          •
       
          managing the selection, engagement, qualifications, independence and
          performance of a qualified firm to serve as the independent registered
          public accounting firm to audit our financial statements;
       
          •
       
          discussing the scope and results of the audit with the independent
          registered public accounting firm, and reviewing, with management and
          the independent accountants, our interim and year-end operating
          results;
       
          •
       
          developing procedures for employees to submit concerns anonymously
          about questionable accounting or audit matters;
       
          •
       
          reviewing related person transactions;
       
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          •
       
          obtaining and reviewing a report by the independent registered public
          accounting firm at least annually that describes our internal quality
          control procedures, any material issues with such procedures and any
          steps taken to deal with such issues when required by applicable law;
          and
       
          •
       
          approving or, as permitted, pre-approving, audit and permissible
          non-audit services to be performed by the independent registered
          public accounting firm.
       
          Our audit committee will operate under a written charter, to be
          effective prior to the completion of this offering, that satisfies the
          applicable listing standards of the New York Stock Exchange.
       
          Compensation Committee
       
          Our compensation committee consists of Pratima Arora, Warren Jenson
          and Hilary Schneider. The chair of our compensation committee is
          Hilary Schneider. Our board of directors has determined that each
          member of the compensation committee is independent under New York
          Stock Exchange listing standards and a “non-employee director” as
          defined in Rule 16b-3 promulgated under the Exchange Act.
       
          The primary purpose of our compensation committee is to discharge the
          responsibilities of our board of directors in overseeing our
          compensation policies, plans and programs and to review and determine
          the compensation to be paid to our executive officers, directors and
          other senior management, as appropriate. Specific responsibilities of
          our compensation committee include:
       
          •
       
          reviewing and approving the compensation of our chief executive
          officer, other executive officers and senior management;
       
          •
       
          reviewing, evaluating and recommending to our board of directors
          succession plans for our executive officers;
       
          •
       
          reviewing and recommending to our board of directors the compensation
          paid to our directors;
       
          •
       
          administering our equity incentive plans and other benefits programs;
       
          •
       
          reviewing, adopting, amending and terminating incentive compensation
          and equity plans, severance agreements, profit sharing plans, bonus
          plans, change-of-control protections and any other compensatory
          arrangements for our executive officers and other senior management;
          and
       
          •
       
          reviewing and establishing general policies relating to compensation
          and benefits of our employees, including our overall compensation
          philosophy.
       
          Our compensation committee will operate under a written charter, to be
          effective prior to the completion of this offering, that satisfies the
          applicable listing standards of the New York Stock Exchange.
       
          Nominating and Corporate Governance Committee
       
          Our nominating and corporate governance committee consists of Warren
          Adelman, Peter Levine and Pueo Keffer. The chair of our nominating and
          corporate governance committee is Peter Levine. Our board of directors
          has determined that each member of the nominating and corporate
          governance committee is independent under New York Stock Exchange
          listing standards.
       
          Specific responsibilities of our nominating and corporate governance
          committee will include:
       
          •
       
          identifying and evaluating candidates, including the nomination of
          incumbent directors for reelection and nominees recommended by
          stockholders, to serve on our board of directors;
       
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          •
       
          considering and making recommendations to our board of directors
          regarding the composition and chairmanship of the committees of our
          board of directors;
       
          •
       
          instituting plans or programs for the continuing education of our
          board of directors and orientation of new directors;
       
          •
       
          developing and making recommendations to our board of directors
          regarding corporate governance guidelines and matters; and
       
          •
       
          overseeing periodic evaluations of the board of directors’
          performance, including committees of the board of directors.
       
          Our nominating and corporate governance committee will operate under a
          written charter, to be effective prior to the completion of this
          offering, that satisfies the applicable listing standards of the New
          York Stock Exchange.
       
          Code of Conduct
       
          We have adopted a Code of Conduct that applies to all our employees,
          officers and directors. This includes our principal executive officer,
          principal financial officer and principal accounting officer or
          controller, or persons performing similar functions. The full text of
          our Code of Conduct will be posted on our website at
          www.digitalocean.com. We intend to disclose on our website any future
          amendments of our Code of Conduct or waivers that exempt any principal
          executive officer, principal financial officer, principal accounting
          officer or controller, persons performing similar functions or our
          directors from provisions in the Code of Conduct. Information
          contained on, or that can be accessed through, our website is not
          incorporated by reference into this prospectus, and you should not
          consider information on our website to be part of this prospectus.
       
          Compensation Committee Interlocks and Insider Participation
       
          None of the members of the compensation committee are currently, or
          have been at any time, one of our officers or employees. None of our
          executive officers currently serve, or have served during the last
          year, as a member of the board of directors or compensation committee
          of any entity that has one or more executive officers serving as a
          member of our board of directors or compensation committee.
       
          Non-Employee Director Compensation
       
          The following table sets forth information regarding compensation
          earned by or paid to our non-employee directors for the year ended
          December 31, 2020. We did not provide any cash compensation to our
          non-employee directors for the year ended December 31, 2020. Yancey
          Spruill, our Chief Executive Officer, is also a member of our board of
          directors but did not receive any additional compensation for his
          service as a director.
       
          Fees Earned
          or Paid in
          Cash
       
          Option
          Awards(3)(4)
       
          Total
       
          Warren Adelman
       
          $
       
                  —
       
          $
       
          865,057
       
          $
       
          865,057
       
          Pratima Arora(1)
       
          —
       
          —
       
          —
       
          Amy Butte
       
          —
       
          —
       
          —
       
          Bradford Gillespie(2)
       
          —
       
          —
       
          —
       
          Warren Jenson
       
          —
       
          970,346
       
          970,346
       
          Pueo Keffer
       
          —
       
          —
       
          —
       
          Peter Levine
       
          —
       
          —
       
          —
       
          Hilary Schneider
       
          —
       
          865,057
       
          865,057
       
          Benya Uretsky(2)
       
          —
       
          —
       
          —
       
          Moisey Uretsky(2)
       
          —
       
          —
       
          —
       
          (1)
       
          Ms. Arora joined our board of directors in February 2021.
       
          (2)
       
          Messrs. Gillespie, Benya Uretsky and Moisey Uretsky resigned from our
          board of directors in February 2021.
       
          (3)
       
          Amounts reported represent the aggregate grant date fair value of
          stock options granted to our directors during 2020 under our 2013
          Plan, computed in accordance with ASC Topic 718, excluding the impact
          of estimated forfeitures. The assumptions used in calculating the
       
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          grant date fair value of the stock options reported in this column are
          set forth in the notes to our audited consolidated financial
          statements included elsewhere in this prospectus. This amount does not
          reflect the actual economic value that may be realized by the
          director.
       
          (4)
       
          The following table sets forth information regarding outstanding
          option awards held by our non-employee directors as of December 31,
          2020:
       
          Number of
          Securities
          Underlying
          Unexercised
          Options
          Exercisable
       
          Number of
          Securities
          Underlying
          Unexercised
          Options
          Unexercisable
       
          Option
          Exercise
          Price
       
          Option
          Grant
          Date
       
          Warren Adelman(a)
       
          2,083
       
          97,917
       
          $
       
          17.37
       
          11/5/2020
       
          Pratima Arora
       
          —
       
          —
       
          —
       
          —
       
          Amy Butte(a)(b)
       
          66,666
       
          33,334
       
          3.43
       
          4/16/2018
       
          15,625
       
          34,375
       
          5.61
       
          9/12/2019
       
          Bradford Gillespie
       
          —
       
          —
       
          —
       
          —
       
          Warren Jenson(a)
       
          —
       
          100,000
       
          19.47
       
          12/16/2020
       
          Pueo Keffer
       
          —
       
          —
       
          —
       
          —
       
          Peter Levine
       
          —
       
          —
       
          —
       
          —
       
          Hilary Schneider(a)
       
          2,083
       
          97,917
       
          17.37
       
          11/5/2020
       
          Benya Uretsky
       
          —
       
          —
       
          —
       
          —
       
          Moisey Uretsky
       
          —
       
          —
       
          —
       
          —
       
          (a)
       
          All shares underlying the options vest in 48 equal monthly
          installments measured from the vesting commencement date, subject to
          each director’s continuous service through each such vesting date.
          100% of the shares underlying these options vest and become
          exercisable upon a change in control.
       
          (b)
       
          Options are held directly by Plato Partners LLC and Ms. Butte owns
          substantially all of Plato Partners LLC.
       
          Non-Employee Director Compensation Policy
       
          Prior to this offering, we did not have a formal policy with respect
          to compensation payable to our non-employee directors for service as
          directors. From time to time, we have granted equity awards to certain
          non-employee directors to entice them to join our board of directors
          and for their continued service on our board of directors. We also
          have reimbursed our directors for expenses associated with attending
          meetings of our board of directors and committees of our board of
          directors.
       
          In February 2021, our board of directors approved a non-employee
          director compensation policy to be effective in connection with this
          offering. Pursuant to this policy, our non-employee directors will
          receive the following compensation, unless such non-employee director
          declines all or a portion of his or her compensation.
       
          Equity Compensation
       
          Each new non-employee director who joins our board of directors on or
          after the completion of this offering will automatically receive an
          RSU award for common stock having a value of $360,000 based on the
          average fair market value of the underlying common stock for the 10
          trading days prior to and ending on the date of grant, or the Initial
          RSU. Each Initial RSU will vest over three years, with one-third of
          the Initial RSU vesting on the first, second and third anniversary of
          the date of grant, subject to the non-employee director’s continued
          service to us through the applicable vesting dates.
       
          On the date of each annual meeting of our stockholders, each person
          who is then a non-employee director will automatically receive an RSU
          award for common stock having a value of $180,000 based on the average
          fair market value of the underlying common stock for the 10 trading
          days prior to and ending on the date of grant, or the Annual RSU. Each
          Annual RSU will vest on the earlier of (i) the date of the following
          year’s annual meeting of our stockholders (or the date immediately
          prior to the next annual meeting of our stockholders if the
          non-employee director’s service as a director ends at such meeting due
          to the director’s failure to be re-elected or the director not
          standing for re-election); or (ii) the first anniversary of the date
          of grant, subject to the non-employee director’s continued service to
          us through the applicable vesting date.
       
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          Any unvested Initial RSU or Annual RSU held by each non-employee
          director who is providing services as of immediately prior to a
          “corporate transaction” (as defined in the director compensation
          policy) will become fully vested as of immediately prior to the
          closing of such corporate transaction.
       
          Cash Compensation
       
          In addition, commencing at the beginning of the first fiscal quarter
          following the completion of this offering, each non-employee director
          will receive the following cash compensation (as applicable) for
          serving on our board of directors and its committees:
       
          •
       
          $35,000 annual cash retainer for service as a board member and an
          additional annual cash retainer of $25,000 for service as chair of our
          board of directors;
       
          •
       
          $10,000 annual cash retainer for service as a member of the audit
          committee and $20,000 annual cash retainer for service as chair of the
          audit committee (in lieu of the committee member service retainer);
       
          •
       
          $7,500 annual cash retainer for service as a member of the
          compensation committee and $15,000 annual cash retainer for service as
          chair of the compensation committee (in lieu of the committee member
          service retainer); and
       
          •
       
          $4,000 annual cash retainer for service as a member of the nominating
          and governance committee and $8,000 annual cash retainer for service
          as chair of the nominating and governance committee (in lieu of the
          committee member service retainer).
       
          The annual cash compensation amounts are payable in equal quarterly
          installments, in arrears following the end of each quarter in which
          the service occurred, pro-rated for any partial months of service.
       
          The Company may establish a program under which non-employee directors
          may elect to receive their retainers in shares of common stock rather
          than cash.
       
          Expenses
       
          We will reimburse each eligible non-employee director for ordinary,
          necessary and reasonable out-of-pocket travel expenses to cover
          in-person attendance at and participation in meetings of our board of
          directors and any committee of the board.
       
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          EXECUTIVE COMPENSATION
       
          Our named executive officers, consisting of our principal executive
          officer and the next two most highly compensated executive officers,
          as of December 31, 2020, were:
       
          •
       
          Yancey Spruill, our Chief Executive Officer;
       
          •
       
          Carly Brantz, our Chief Marketing Officer; and
       
          •
       
          Jeffrey Guy, our Chief Operating Officer.
       
          2020 Summary Compensation Table
       
          The following table presents all of the compensation awarded to or
          earned by or paid to our named executive officers for the year ended
          December 31, 2020.
       
          Name and Principal Position
       
          Salary
       
          Bonus(1)
       
          Option
          Awards(2)
       
          Non-Equity
          Incentive Plan
          Compensation(3)
       
          All Other
          Compensation(4)
       
          Total
       
          Yancey Spruill
       
          $
       
          450,000
       
          $
       
          —
       
          $
       
          —
       
          $
       
          626,400
       
          $
       
          13,847
       
          $
       
          1,090,247
       
          Chief Executive Officer
       
          Carly Brantz
       
          320,000
       
          —
       
          1,416,357
       
          245,000
       
          11,548
       
          1,992,905
       
          Chief Marketing Officer
       
          Jeffrey Guy
       
          304,792
       
          (5)
       
          50,000
       
          1,636,407
       
          262,500
       
          18,269
       
          2,271,968
       
          Chief Operating Officer
       
          (1)
       
          Amount shown represents a one-time signing bonus awarded to Mr. Guy.
       
          (2)
       
          Amounts reported represent the aggregate grant date fair value of
          stock options granted to our executive officers during 2020 under our
          2013 Plan, computed in accordance with ASC Topic 718, excluding the
          impact of estimated forfeitures. The assumptions used in calculating
          the grant date fair value of the stock options reported in this column
          are set forth in the notes to our audited consolidated financial
          statements included elsewhere in this prospectus. This amount does not
          reflect the actual economic value that may be realized by the
          executive officer.
       
          (3)
       
          Amounts shown represent the executive officers’ total bonuses earned
          for 2020 based on the achievement of company and individual
          performance goals as determined by our board of directors.
       
          (4)
       
          Amounts shown represent life insurance premiums paid by us on behalf
          of the executive officer, 401(k) employer contributions and home
          office and gym reimbursements.
       
          (5)
       
          Mr. Guy joined us in February 2020. Amount represents the pro rata
          portion of his 2020 annual base salary.
       
          Outstanding Equity Awards as of December 31, 2020
       
          The following table presents information regarding outstanding equity
          awards held by our named executive officers as of December 31, 2020.
       
          Option Awards(1)
       
          Stock Awards
       
          Name
       
          Number of
          Securities
          Underlying
          Unexercised
          Options
          Exercisable
       
          Number of
          Securities
          Underlying
          Unexercised
          Options
          Unexercisable
       
          Option
          Exercise
          Price
       
          Option
          Expiration
          Date
       
          Number of
          Shares or
          Units of
          Stock that
          Have Not
          Vested
       
          Market Value
          of
          Shares or
          Units of Stock
          that Have Not
          Vested
       
          Yancey Spruill
       
          1,166,666
       
          (2)
       
          2,333,334
       
          $
       
          5.61
       
          8/13/2029
       
          $                     
       
          Carly Brantz
       
          —
       
          435,000
       
          (3)
       
          6.72
       
          3/12/2030
       
          Jeffrey Guy
       
          —
       
          500,000
       
          (4)
       
          6.72
       
          3/12/2030
       
          (1)
       
          All of the option awards listed in the table above were granted under
          the 2013 Plan. The terms of the plan are described below under
          “—Equity Incentive Plans.”
       
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          (2)
       
          25% of the shares underlying this option vested on August 13, 2020,
          with the remaining shares vesting in equal monthly installments over
          the next three years, subject to the executive officer’s continuous
          service through each such vesting date.
       
          (3)
       
          25% of the shares underlying this option vested on January 1, 2021,
          with the remaining shares vesting in equal monthly installments over
          the next three years, subject to the executive officer’s continuous
          service through each such vesting date.
       
          (4)
       
          25% of the shares underlying this option vested on February 18, 2021,
          with the remaining shares vesting in equal monthly installments over
          the next three years, subject to the executive officer’s continuous
          service through each such vesting date.
       
          Employment Arrangements
       
          We have entered into employment arrangements with each of our named
          executive officers. The arrangements generally provide for at-will
          employment without any specific term and set forth the named executive
          officer’s initial base salary, bonus potential, eligibility for
          employee benefits and severance benefits upon a qualifying termination
          of employment, subject to such employee executing a separation
          agreement with us.
       
          Yancey Spruill
       
          In July 2019, we entered into an offer letter with Yancey Spruill, our
          Chief Executive Officer. The offer letter has no specific term and
          provides for at-will employment. Mr. Spruill initially had an annual
          base salary of $450,000, which was increased to $514,000, effective as
          of March 1, 2021. Mr. Spruill is currently eligible for a target
          annual discretionary performance bonus of up to 100% of his annual
          base salary, based on individual and corporate performance goals.
       
          Under Mr. Spruill’s offer letter, if he resigns for “good reason” or
          we terminate his employment without “cause” (each as defined in his
          offer letter), then Mr. Spruill will be eligible to receive the
          following severance benefits (less applicable withholdings): (1)
          severance pay equal to 100% of Mr. Spruill’s then-current base salary
          for a period of one year, paid in equal installments at the end of
          each of the four calendar quarters following Mr. Spruill’s last day of
          employment; (2) a bonus calculated at 100% achievement of all company
          and individual performance objectives, paid in equal installments at
          the end of each of the four calendar quarters following Mr. Spruill’s
          last day of employment; and (3) reimbursement of COBRA premiums for
          him and his eligible dependents for a period of one year. Mr. Spruill
          will have 12 months to exercise the vested shares subject to the
          option granted to him in August 2019 if he resigns for good reason or
          his employment is terminated without cause by us or a successor.
          Further, if Mr. Spruill resigns for good reason or his employment is
          terminated without cause by us or a successor, in either case within
          90 days prior to or within 12 months following a “change in control”
          (as defined in his offer letter), in addition to the severance
          payments described above, 100% of the shares subject to the option
          granted to him in August 2019 will vest and become exercisable. As a
          condition to receiving the severance benefits above, Mr. Spruill must
          sign and not revoke a general release agreement in a form reasonably
          acceptable to us within the time period set forth in his offer letter
          and continue to comply with his obligations related to confidentiality
          and competitive activity.
       
          Prior to the completion of this offering, we intend to enter into an
          amended and restated offer letter with Mr. Spruill, which will
          supersede all existing agreements.
       
          Carly Brantz
       
          Prior to the completion of this offering, we intend to enter into an
          amended and restated offer letter with Carly Brantz, which will
          supersede all existing agreements. Effective as of March 1, 2021, Ms.
          Brantz’s current annual base salary is $340,000.
       
          Jeffrey Guy
       
          Prior to the completion of this offering, we intend to enter into an
          amended and restated offer letter with Jeffrey Guy, which will
          supersede all existing agreements. Effective as of March 1, 2021, Mr.
          Guy’s current annual base salary is $400,000.
       
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          Pension Benefits and Nonqualified Deferred Compensation
       
          Our named executive officers did not participate in, or earn any
          benefits under, any pension or retirement plan or nonqualified
          deferred compensation plan sponsored by us during the year ended
          December 31, 2020. Our board of directors may elect to provide our
          officers and other employees with nonqualified deferred compensation
          benefits in the future if it determines that doing so is in our best
          interests.
       
          Employee Benefit Plans
       
          Health and Welfare Benefits
       
          All of our current named executive officers are eligible to
          participate in our employee benefit plans, including our medical,
          dental, vision, life, disability and accidental death and
          dismemberment insurance plans. We pay the premiums for the life,
          disability and accidental death and dismemberment insurance for all of
          our employees, including our named executive officers.
       
          401(k) Plan
       
          We maintain a 401(k) plan that provides eligible U.S. employees with
          an opportunity to save for retirement on a tax advantaged basis.
          Eligible employees are able to defer eligible compensation up to
          certain Code limits, which are updated annually. Currently, we match
          100% of the contributions that eligible employees make to the 401(k)
          plan up to 3% of the employee’s eligible compensation and, following
          such amount, 50% of the contributions that eligible employees make to
          the 401(k) plan up to the next 2% of the employee’s eligible
          compensation. The 401(k) plan is intended to be qualified under
          Section 401(a) of the Code, with the related trust intended to be tax
          exempt under Section 501(a) of the Code. As a tax-qualified retirement
          plan, contributions to the 401(k) plan are deductible by us when made,
          and contributions and earnings on those amounts are not generally
          taxable to the employees until withdrawn or distributed from
          the 401(k) plan.
       
          Equity Incentive Plans
       
          2021 Equity Incentive Plan
       
          Our board of directors adopted our 2021 Plan in                2021,
          and we expect our stockholders to approve our 2021 Plan prior to the
          completion of this offering. Our 2021 Plan is a successor to and
          continuation of our 2013 Plan. Our 2021 Plan will become effective on
          the date of the underwriting agreement related to this offering. The
          2021 Plan came into existence upon its adoption by our board of
          directors, but no grants will be made under the 2021 Plan prior to its
          effectiveness. Once the 2021 Plan is effective, no further grants will
          be made under the 2013 Plan.
       
          Awards. Our 2021 Plan provides for the grant of incentive stock
          options (ISOs) within the meaning of Section 422 of the Code to
          employees, including employees of any parent or subsidiary, and for
          the grant of nonstatutory stock options (NSOs), stock appreciation
          rights, restricted stock awards, restricted stock unit awards,
          performance awards and other forms of awards to employees, directors
          and consultants, including employees and consultants of our
          affiliates.
       
          Authorized Shares. Initially, the maximum number of shares of our
          common stock that may be issued under our 2021 Plan after it becomes
          effective will not exceed                shares of our common stock,
          which is the sum of (1)                new shares, plus (2) an
          additional number of shares not to exceed                , consisting
          of (A) shares that remain available for the issuance of awards under
          our 2013 Plan as of immediately prior to the time our 2021 Plan
          becomes effective and (B) shares of our common stock subject to
          outstanding stock options or other stock awards granted under our 2013
          Plan that, on or after the 2021 Plan becomes effective, terminate or
          expire prior to exercise or settlement; are not issued because the
          award is settled in cash; are forfeited because of
       
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          the failure to vest; or are reacquired or withheld (or not issued) to
          satisfy a tax withholding obligation or the purchase or exercise
          price, if any, as such shares become available from time to time. In
          addition, the number of shares of our common stock reserved for
          issuance under our 2021 Plan will automatically increase on January 1
          of each calendar year, starting on January 1, 2022 through January 1,
          2031, in an amount equal to (i)     % of the total number of shares of
          our common stock outstanding on December 31 of the fiscal year before
          the date of each automatic increase, or (ii) a lesser number of shares
          determined by our board of directors prior to the applicable
          January 1. The maximum number of shares of our common stock that may
          be issued on the exercise of ISOs under our 2021 Plan
          is                shares.
       
          Shares subject to stock awards granted under our 2021 Plan that expire
          or terminate without being exercised in full or that are paid out in
          cash rather than in shares do not reduce the number of shares
          available for issuance under our 2021 Plan. Shares withheld under a
          stock award to satisfy the exercise, strike or purchase price of a
          stock award or to satisfy a tax withholding obligation do not reduce
          the number of shares available for issuance under our 2021 Plan. If
          any shares of our common stock issued pursuant to a stock award are
          forfeited back to or repurchased or reacquired by us (1) because of a
          failure to meet a contingency or condition required for the vesting of
          such shares, (2) to satisfy the exercise, strike or purchase price of
          an award or (3) to satisfy a tax withholding obligation in connection
          with an award, the shares that are forfeited or repurchased or
          reacquired will revert to and again become available for issuance
          under the 2021 Plan.
       
          Plan Administration. Our board of directors, or a duly authorized
          committee of our board of directors, will administer our 2021 Plan and
          is referred to as the “plan administrator” herein. Our board of
          directors may also delegate to one or more of our officers the
          authority to (1) designate employees (other than officers) to receive
          specified stock awards and (2) determine the number of shares subject
          to such stock awards. Under our 2021 Plan, our board of directors has
          the authority to determine award recipients, grant dates, the numbers
          and types of stock awards to be granted, the fair market value of our
          common stock, and the provisions of each stock award, including the
          period of exercisability and the vesting schedule applicable to a
          stock award.
       
          Under our 2021 Plan, our board of directors also generally has the
          authority to effect, with the consent of any materially adversely
          affected participant, (1) the reduction of the exercise, purchase or
          strike price of any outstanding option or stock appreciation right;
          (2) the cancellation of any outstanding option or stock appreciation
          right and the grant in substitution therefore of other awards, cash,
          or other consideration; or (3) any other action that is treated as a
          repricing under generally accepted accounting principles.
       
          Stock Options. ISOs and NSOs are granted under stock option agreements
          adopted by the plan administrator. The plan administrator determines
          the exercise price for stock options, within the terms and conditions
          of the 2021 Plan, except the exercise price of a stock option
          generally cannot be less than 100% of the fair market value of our
          common stock on the date of grant. Options granted under the 2021 Plan
          vest at the rate specified in the stock option agreement as determined
          by the plan administrator.
       
          The plan administrator determines the term of stock options granted
          under the 2021 Plan, up to a maximum of 10 years. Unless the terms of
          an optionholder’s stock option agreement, or other written agreement
          between us and the optionholder, provide otherwise, if an
          optionholder’s service relationship with us or any of our affiliates
          ceases for any reason other than disability, death, or cause, the
          optionholder may generally exercise any vested options for a period of
          three months following the cessation of service. This period may be
          extended in the event that exercise of the option is prohibited by
          applicable securities laws. If an optionholder’s service relationship
          with us or any of our affiliates ceases due to death, or an
          optionholder dies within a certain period following cessation of
          service, the optionholder or a beneficiary may generally exercise any
          vested options for a period of 12 months following the date of death.
          If an optionholder’s service relationship with us or any of our
          affiliates ceases due to disability, the optionholder may generally
          exercise any vested options for a period of 12 months following the
          cessation of service. In the event of a termination for cause, options
          generally terminate immediately upon such termination. In no event may
          an option be exercised beyond the expiration of its term.
       
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          Acceptable consideration for the purchase of common stock issued upon
          the exercise of a stock option will be determined by the plan
          administrator and may include (1) cash, check, bank draft or money
          order, (2) a broker-assisted cashless exercise, (3) the tender of
          shares of our common stock previously owned by the optionholder, (4) a
          net exercise of the option if it is an NSO, or (5) other legal
          consideration approved by the plan administrator.
       
          Unless the plan administrator provides otherwise, options or stock
          appreciation rights generally are not transferable except by will or
          the laws of descent and distribution. Subject to approval of the plan
          administrator or a duly authorized officer, an option may be
          transferred pursuant to a domestic relations order, official marital
          settlement agreement, or other divorce or separation instrument.
       
          Tax Limitations on ISOs. The aggregate fair market value, determined
          at the time of grant, of our common stock with respect to ISOs that
          are exercisable for the first time by an award holder during any
          calendar year under all of our stock plans may not exceed $100,000.
          Options or portions thereof that exceed such limit will generally be
          treated as NSOs. No ISO may be granted to any person who, at the time
          of the grant, owns or is deemed to own stock possessing more than 10%
          of our total combined voting power or that of any of our parent or
          subsidiary corporations unless (1) the option exercise price is at
          least 110% of the fair market value of the stock subject to the option
          on the date of grant, and (2) the term of the ISO does not exceed five
          years from the date of grant.
       
          Restricted Stock Unit Awards. Restricted stock unit awards are granted
          under restricted stock unit award agreements adopted by the plan
          administrator. Restricted stock unit awards may be granted in
          consideration for any form of legal consideration that may be
          acceptable to our board of directors and permissible under applicable
          law. A restricted stock unit award may be settled by cash, delivery of
          stock, a combination of cash and stock as deemed appropriate by the
          plan administrator, or in any other form of consideration set forth in
          the restricted stock unit award agreement. Additionally, dividend
          equivalents may be credited in respect of shares covered by a
          restricted stock unit award. Except as otherwise provided in the
          applicable award agreement, or other written agreement between us and
          the recipient, restricted stock unit awards that have not vested will
          be forfeited once the participant’s continuous service ends for any
          reason.
       
          Restricted Stock Awards. Restricted stock awards are granted under
          restricted stock award agreements adopted by the plan administrator. A
          restricted stock award may be awarded in consideration for cash,
          check, bank draft or money order, past or future services to us, or
          any other form of legal consideration that may be acceptable to our
          board of directors and permissible under applicable law. The plan
          administrator determines the terms and conditions of restricted stock
          awards, including vesting and forfeiture terms. If a participant’s
          service relationship with us ends for any reason, we may receive any
          or all of the shares of common stock held by the participant that have
          not vested as of the date the participant terminates service with us
          through a forfeiture condition or a repurchase right.
       
          Stock Appreciation Rights. Stock appreciation rights are granted under
          stock appreciation right agreements adopted by the plan administrator.
          The plan administrator determines the purchase price or strike price
          for a stock appreciation right, which generally cannot be less than
          100% of the fair market value of our common stock on the date of
          grant. A stock appreciation right granted under the 2021 Plan vests at
          the rate specified in the stock appreciation right agreement as
          determined by the plan administrator. Stock appreciation rights may be
          settled in cash or shares of common stock or in any other form of
          payment as determined by the Board and specified in the stock
          appreciation right agreement.
       
          The plan administrator determines the term of stock appreciation
          rights granted under the 2021 Plan, up to a maximum of 10 years. If a
          participant’s service relationship with us or any of our affiliates
          ceases for any reason other than cause, disability, or death, the
          participant may generally exercise any vested stock appreciation right
          for a period of three months following the cessation of service. This
          period may be further extended in the event that exercise of the stock
          appreciation right following such a termination of service is
          prohibited by applicable
       
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          securities laws. If a participant’s service relationship with us, or
          any of our affiliates, ceases due to disability or death, or a
          participant dies within a certain period following cessation of
          service, the participant or a beneficiary may generally exercise any
          vested stock appreciation right for a period of 12 months in the event
          of disability and 12 months in the event of death. In the event of a
          termination for cause, stock appreciation rights generally terminate
          immediately upon such termination. In no event may a stock
          appreciation right be exercised beyond the expiration of its term.
       
          Performance Awards. The 2021 Plan permits the grant of performance
          awards that may be settled in stock, cash or other property.
          Performance awards may be structured so that the stock or cash will be
          issued or paid only following the achievement of certain
          pre-established performance goals during a designated performance
          period. Performance awards that are settled in cash or other property
          are not required to be valued in whole or in part by reference to, or
          otherwise based on, our common stock.
       
          The performance goals may be based on any measure of performance
          selected by the board of directors. The performance goals may be based
          on company-wide performance or performance of one or more business
          units, divisions, affiliates, or business segments, and may be either
          absolute or relative to the performance of one or more comparable
          companies or the performance of one or more relevant indices. Unless
          specified otherwise by the board of directors at the time the
          performance award is granted, the board will appropriately make
          adjustments in the method of calculating the attainment of performance
          goals as follows: (i) to exclude restructuring and/or other
          nonrecurring charges; (ii) to exclude exchange rate effects; (iii) to
          exclude the effects of changes to generally accepted accounting
          principles; (iv) to exclude the effects of any statutory adjustments
          to corporate tax rates; (v) to exclude the effects of items that are
          “unusual” in nature or occur “infrequently” as determined under
          generally accepted accounting principles; (vi) to exclude the dilutive
          effects of acquisitions or joint ventures; (vii) to assume that any
          business divested by us achieved performance objectives at targeted
          levels during the balance of a performance period following such
          divestiture; (viii) to exclude the effect of any change in the
          outstanding shares of our common stock by reason of any stock dividend
          or split, stock repurchase, reorganization, recapitalization, merger,
          consolidation, spin-off, combination or exchange of shares or other
          similar corporate change, or any distributions to common stockholders
          other than regular cash dividends; (ix) to exclude the effects of
          stock based compensation and the award of bonuses under our bonus
          plans; (x) to exclude costs incurred in connection with potential
          acquisitions or divestitures that are required to be expensed under
          generally accepted accounting principles; and (xi) to exclude the
          goodwill and intangible asset impairment charges that are required to
          be recorded under generally accepted accounting principles.
       
          Other Stock Awards. The plan administrator may grant other awards
          based in whole or in part by reference to our common stock. The plan
          administrator will set the number of shares under the stock award (or
          cash equivalent) and all other terms and conditions of such awards.
       
          Non-Employee Director Compensation Limit. The aggregate value of all
          compensation granted or paid to any non-employee director with respect
          to any calendar year, including awards granted and cash fees paid by
          us to such non-employee director, will not exceed $750,000 in total
          value, except such amount will increase to $1,000,000 for the first
          year for newly appointed or elected non-employee directors.
       
          Changes to Capital Structure. In the event there is a specified type
          of change in our capital structure, such as a stock split, reverse
          stock split, or recapitalization, appropriate adjustments will be made
          to (1) the class and maximum number of shares reserved for issuance
          under the 2021 Plan, (2) the class and maximum number of shares by
          which the share reserve may increase automatically each year, (3) the
          class and maximum number of shares that may be issued on the exercise
          of ISOs, and (4) the class and number of shares and exercise price,
          strike price, or purchase price, if applicable, of all outstanding
          stock awards.
       
          Corporate Transactions. The following applies to stock awards under
          the 2021 Plan in the event of a corporate transaction (as defined in
          the 2021 Plan), unless otherwise provided in a participant’s stock
          award agreement or other written agreement with us or one of our
          affiliates or unless otherwise expressly provided by the plan
          administrator at the time of grant.
       
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          In the event of a corporate transaction, any stock awards outstanding
          under the 2021 Plan may be assumed, continued or substituted for by
          any surviving or acquiring corporation (or its parent company), and
          any reacquisition or repurchase rights held by us with respect to the
          stock award may be assigned to the successor (or its parent company).
          If the surviving or acquiring corporation (or its parent company) does
          not assume, continue or substitute for such stock awards, then
          (i) with respect to any such stock awards that are held by
          participants whose continuous service has not terminated prior to the
          effective time of the corporate transaction, or current participants,
          the vesting (and exercisability, if applicable) of such stock awards
          will be accelerated in full (or, in the case of performance awards
          with multiple vesting levels depending on the level of performance,
          vesting will accelerate at 100% of the target level) to a date prior
          to the effective time of the corporate transaction (contingent upon
          the effectiveness of the corporate transaction), and such stock awards
          will terminate if not exercised (if applicable) at or prior to the
          effective time of the corporate transaction, and any reacquisition or
          repurchase rights held by us with respect to such stock awards will
          lapse (contingent upon the effectiveness of the corporate
          transaction), and (ii) any such stock awards that are held by persons
          other than current participants will terminate if not exercised (if
          applicable) prior to the effective time of the corporate transaction,
          except that any reacquisition or repurchase rights held by us with
          respect to such stock awards will not terminate and may continue to be
          exercised notwithstanding the corporate transaction.
       
          In the event a stock award will terminate if not exercised prior to
          the effective time of a corporate transaction, the plan administrator
          may provide, in its sole discretion, that the holder of such stock
          award may not exercise such stock award but instead will receive a
          payment equal in value to the excess (if any) of (i) the per share
          amount payable to holders of common stock in connection with the
          corporate transaction, over (ii) any per share exercise price payable
          by such holder, if applicable. In addition, any escrow, holdback, earn
          out or similar provisions in the definitive agreement for the
          corporate transaction may apply to such payment to the same extent and
          in the same manner as such provisions apply to the holders of common
          stock.
       
          Change in Control. Awards granted under the 2021 Plan may be subject
          to acceleration of vesting and exercisability upon or after a change
          in control (as defined in the 2021 Plan) as may be provided in the
          applicable stock award agreement or in any other written agreement
          between us or any affiliate and the participant, but in the absence of
          such provision, no such acceleration will automatically occur.
       
          Plan Amendment or Termination. Our board of directors has the
          authority to amend, suspend, or terminate our 2021 Plan at any time,
          provided that such action does not materially impair the existing
          rights of any participant without such participant’s written consent.
          Certain material amendments also require the approval of our
          stockholders. No ISOs may be granted after the tenth anniversary of
          the date our board of directors adopts our 2021 Plan. No stock awards
          may be granted under our 2021 Plan while it is suspended or after it
          is terminated.
       
          2021 Employee Stock Purchase Plan
       
          Our board of directors adopted the 2021 Employee Stock Purchase Plan,
          or ESPP, on                , 2021 and our stockholders approved the
          ESPP on                , 2021. The ESPP will become effective
          immediately prior to and contingent upon the date of the underwriting
          agreement related to this offering. The purpose of the ESPP is to
          secure the services of new employees, to retain the services of
          existing employees and to provide incentives for such individuals to
          exert maximum efforts toward our success and that of our affiliates.
          The ESPP is intended to qualify as an “employee stock purchase plan”
          within the meaning of Section 423 of the Code. Our ESPP includes two
          components. One component is designed to allow eligible U.S. employees
          to purchase our common stock in a manner that may qualify for
          favorable tax treatment under Section 423 of the Code. The other
          component permits the grant of purchase rights that do not qualify for
          such favorable tax treatment in order to allow deviations necessary to
          permit participation by eligible employees who are foreign nationals
          or employed outside of the U.S. while complying with applicable
          foreign laws. For purposes of this summary, a reference to our ESPP
          generally will mean the terms and operations of the 423 component.
       
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          Share Reserve. Following this offering, the ESPP will authorize the
          issuance of                shares of our common stock pursuant to
          purchase rights granted to our employees or to employees of any of our
          designated affiliates. The number of shares of our common stock
          reserved for issuance will automatically increase on January 1 of each
          calendar year, from January 1, 2022 (assuming the ESPP becomes
          effective in 2021) through January 1, 2031, by the lesser of (1)     %
          of the total number of shares of our common stock outstanding on
          December 31 of the preceding calendar year, and
          (2)                shares; provided that prior to the date of any such
          increase, our board of directors may determine that such increase will
          be less than the amount set forth in clauses (1) and (2).
       
          Administration. Our board of directors has delegated concurrent
          authority to administer the ESPP to our compensation committee. The
          ESPP is implemented through a series of offerings under which eligible
          employees are granted purchase rights to purchase shares of our common
          stock on specified dates during such offerings. Under the ESPP, we may
          specify offerings with durations of not more than 27 months. It is
          contemplated that each of the purchase periods will be months. An
          offering under the ESPP may be terminated under certain circumstances.
       
          Payroll Deductions. Generally, all regular employees, including
          executive officers, employed by us or by any of our designated
          affiliates, may participate in the ESPP and may contribute, normally
          through payroll deductions, up to 15% of their earnings (as defined in
          the ESPP) for the purchase of our common stock under the ESPP. Unless
          otherwise determined by our board of directors, common stock will be
          purchased for the accounts of employees participating in the ESPP at a
          price per share equal to the lower of (a) 85% of the fair market value
          of a share of our common stock on the first trading date of an
          offering, which will be deemed to be the initial public offering price
          set forth on the cover page of this prospectus for the first offering,
          or (b) 85% of the fair market value of a share of our common stock on
          the date of purchase.
       
          Limitations. Employees may have to satisfy one or more of the
          following service requirements before participating in the ESPP, as
          determined by our board of directors, including: (1) being customarily
          employed for more than 20 hours per week; (2) being customarily
          employed for more than five months per calendar year; or
          (3) continuous employment with us or one of our affiliates for six
          months. No employee may purchase shares under the ESPP at a rate in
          excess of $25,000 worth of our common stock based on the fair market
          value per share of our common stock at the beginning of an offering
          for each calendar year such a purchase right is outstanding and may
          not purchase more than                shares in any offering period.
          Finally, no employee will be eligible for the grant of any purchase
          rights under the ESPP if immediately after such rights are granted,
          such employee has voting power over 5% or more of our outstanding
          capital stock measured by vote or value pursuant to Section 424(d) of
          the Code.
       
          Changes to Capital Structure. In the event that there occurs a change
          in our capital structure through such actions as a stock split,
          merger, consolidation, reorganization, recapitalization,
          reincorporation, stock dividend, dividend in property other than cash,
          large nonrecurring cash dividend, liquidating dividend, combination of
          shares, exchange of shares, change in corporate structure or similar
          transaction, the board of directors will make appropriate adjustments
          to (1) the class(es) and maximum number of shares reserved under the
          ESPP, (2) the class(es) and maximum number of shares by which the
          share reserve may increase automatically each year, (3) the class(es)
          and number of shares subject to, and purchase price applicable to,
          outstanding offerings and purchase rights and (4) the class(es) and
          number of shares that are subject to purchase limits under ongoing
          offerings.
       
          Corporate Transactions. In the event of a corporate transaction (as
          defined in the ESPP), any then-outstanding rights to purchase our
          stock under the ESPP may be assumed, continued or substituted for by
          any surviving or acquiring entity (or its parent company). If the
          surviving or acquiring entity (or its parent company) elects not to
          assume, continue or substitute for such purchase rights, then the
          participants’ accumulated payroll contributions will be used to
          purchase shares of our common stock within 10 business days prior to
          such corporate transaction, and such purchase rights will terminate
          immediately.
       
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          ESPP Amendments, Termination. Our board of directors has the authority
          to amend or terminate our ESPP, except in certain circumstances such
          amendment or termination may not materially impair any outstanding
          purchase rights without the holder’s consent. We will obtain
          stockholder approval of any amendment to our ESPP, as required by
          applicable law or listing requirements.
       
          2013 Stock Plan
       
          Our board of directors adopted our 2013 Plan on October 30, 2013, and
          our stockholders approved our 2013 Plan on November 4, 2013. Our 2013
          Plan was most recently amended on May 8, 2020. No further awards will
          be granted under our 2013 Plan on or after the effectiveness of our
          2021 Plan; however, awards outstanding under our 2013 Plan will
          continue to be governed by their existing terms.
       
          Awards. Our 2013 Plan provides for the direct award or sale of shares
          and for the grant of incentive stock options, or ISOs, within the
          meaning of Section 422 of the Code, nonstatutory stock options, or
          NSOs, and restricted stock unit awards. ISOs may only be granted to
          our employees. All other awards may be granted to our employees,
          non-employee members of our board of directors and consultants and any
          of our subsidiary corporations’ employees and consultants.
       
          Authorized Shares. As of December 31, 2020, we had reserved 34,821,642
          shares of our common stock for issuance under our 2013 Plan, all of
          which could be issued on the exercise of incentive stock options. As
          of December 31, 2020, options to purchase 16,933,494 shares of our
          common stock and RSUs covering 413,750 shares of our common stock were
          outstanding under our 2013 Plan, and 2,144,599 shares of our common
          stock remained available for issuance under our 2013 Plan. Unissued
          shares of our common stock underlying awards that expire or are
          canceled, shares reacquired by us after being issued under our 2013
          Plan, or shares otherwise issuable under our 2013 Plan that are
          withheld by us for payment of the purchase price, exercise price or
          withholding taxes in respect of an award are currently added back to
          the shares of common stock available for issuance under our 2013 Plan.
          Upon the effectiveness of our 2021 Plan, such shares will be added to
          the shares available for issuance under our 2021 Plan. In addition,
          upon the effectiveness of our 2021 Plan, the shares reserved but not
          issued or subject to outstanding awards under our 2013 Plan will
          become available for grant and issuance under our 2021 Plan.
       
          Plan Administration. Our board of directors or one or more committees
          appointed by our board of directors may administer our 2013 Plan.
          Subject to the terms of our 2013 Plan, the administrator has full
          authority and discretion to take any actions it deems necessary or
          advisable for the administration of our 2013 Plan. With respect to the
          terms and conditions of awards granted to participants outside the
          United States, our board of directors may vary from the provisions of
          our 2013 Plan that do not require stockholder approval to the extent
          it determines it necessary and appropriate to do so.
       
          Within the limitations of our 2013 Plan, the administrator also has
          the authority to modify, extend or assume outstanding options and to
          accept the cancellation of outstanding options (whether granted by us
          or another issuer) in return for the grant of new options or a
          different type of award for the same or a different number of shares
          of our common stock and at the same or a different exercise price.
          However, no modification of an option may impair the participant’s
          rights or increase the participant’s obligations under the option
          without the consent of the participant.
       
          Stock Options. Stock options have been granted under our 2013 Plan.
          Subject to the terms and conditions of our 2013 Plan, the
          administrator determines the terms and conditions of stock options,
          including, but not limited to, the number of shares subject to the
          stock option, the exercise price of the stock option, the term of the
          stock option, and the time(s) at which the stock option may become
          exercisable. The exercise price of stock options granted under our
          2013 Plan generally cannot be less than 100% of the fair market value
          of a share of our common stock on the grant date. The term of a stock
          option may not exceed ten years from the grant date. With respect to
          any participant who owns more than 10% of the voting power of all
          classes of our (or any of our
       
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          parent’s or subsidiary’s) outstanding stock, the term of an incentive
          stock option granted to such participant must not exceed five years
          from the grant date and the per share exercise price cannot be less
          than 110% of the fair market value of a share of our common stock on
          the grant date. The exercise price of a stock option may be paid by
          cash or cash equivalents, or by one or any combination of other
          payment methods permitted by the administrator, which may include
          (without limitation): (i) the tender of shares of our common stock
          previously owned by the participant, (ii) “net exercise,” (iii)
          following the completion of this offering, a “same day sale” or
          “cashless exercise” procedure, or (iv) other legal consideration
          permitted by applicable law. Unless otherwise provided in a
          participant’s option agreement, if a participant’s service terminates,
          the participant’s then-vested stock options granted under our 2013
          Plan will remain exercisable following termination for a period of
          three months if the termination is other than for cause (as defined in
          our 2013 Plan), death or disability, for a period of six months if
          termination is due to disability, for a period of 12 months if
          termination is due to death, or such longer or shorter period as the
          administrator may determine. For options granted after May 8, 2020, if
          a participant’s services are terminated for cause, the participant’s
          stock option will immediately terminate. In no event may a stock
          option be exercised later than the expiration of its term.
       
          Restricted Stock Unit Awards. We have granted restricted stock unit
          awards under our 2013 Plan. Subject to the terms of our 2013 Plan, the
          administrator determines the terms and conditions of restricted stock
          unit awards. Restricted stock unit awards may be granted in
          consideration for any form of legal consideration that may be
          acceptable to our board of directors and permissible under applicable
          law. The administrator may impose such conditions or restrictions to
          vesting of a restricted stock unit award as it deems appropriate. A
          restricted stock unit award may be settled by cash, delivery of shares
          of our common stock, a combination of cash and shares, or in any other
          form of consideration, as determined by the administrator and set
          forth in the restricted stock unit agreement. Additionally, dividend
          equivalents may be credited in respect of shares covered by a
          restricted stock unit award. Except as otherwise provided in the
          applicable restricted stock unit agreement, restricted stock unit
          awards that have not vested will be forfeited upon the participant’s
          termination of service.
       
          Transferability of Awards. Our 2013 Plan generally does not allow for
          the transfer of awards except by a beneficiary designation, a will or
          the laws of descent and distribution, and an incentive stock option
          may be exercised during the lifetime of the participant only by the
          participant or the participant’s guardian or legal representative.
       
          Changes in Capitalization. In the event of a subdivision of our
          outstanding common stock, a stock dividend, a combination or
          consolidation of our outstanding common stock into a lesser number of
          shares, a reclassification, or any other increase or decrease in the
          number of issued shares of our common stock effected without receipt
          of consideration by us, proportionate adjustments will automatically
          be made in each of (i) the number and kind of shares available for
          issuance under our 2013 Plan, (ii) the number and kind of shares
          covered by each outstanding award, (iii) the exercise price or
          purchase price, if any, applicable to each outstanding award, and
          (iv) any repurchase price applicable to shares granted under our 2013
          Plan. In the event of an extraordinary dividend payable in a form
          other than shares of our common stock in an amount that has a material
          effect on the fair market value of our common stock, a
          recapitalization, spin-off, or other similar occurrence, the
          administrator at its sole discretion may make appropriate adjustments
          to one or more of the items described above.
       
          Corporate Transactions. If we are a party to a merger or
          consolidation, or in the event of a sale of all or substantially all
          of our stock or assets, outstanding awards under our 2013 Plan will be
          treated in the manner set forth in the definitive transaction
          agreement (or, if the transaction does not involve such an agreement,
          in the manner determined by our board of directors), which agreement
          or determination need not treat all outstanding awards in an identical
          manner, and may include one or more of the following treatments with
          respect to each outstanding award: (i) continuation, assumption or
          substitution of the award by the surviving corporation (or its
          parent); (ii) cancellation of the award in exchange for a payment with
          respect to each share subject to the portion of the award that is
          vested or has met any service-based requirement as of the transaction
          date equal to the excess of (a) the value of the property (including
          cash) received by the holder of a share of our common stock as a
          result of the transaction over (b) the per share exercise price (if
          any) of the award; (iii) cancellation of the stock option or unvested
          restricted stock unit award for no consideration; however, in the case
          of a stock option, the
       
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          participant will be notified of such treatment and given an
          opportunity to exercise the option (to the extent it is vested or it
          becomes vested as of the effective date of the transaction) during a
          period that will generally be not less than five business days
          preceding the effective date of the transaction; (iv) in the case of a
          stock option, suspension of the right to exercise the stock option for
          a limited period preceding the closing of the transaction if
          administratively necessary to permit the closing of the transaction;
          or (v) in the case of a stock option, termination of any right to
          exercise shares subject to the stock option prior to vesting so that
          the stock option may only be exercised for vested shares after the
          closing of the transaction. Our board of directors has discretion to
          accelerate, in whole or part, the vesting and exercisability of an
          award in connection with a corporate transaction described above.
       
          Amendment and Termination. Our board of directors may amend, suspend
          or terminate our 2013 Plan at any time and for any reason, subject to
          stockholder approval where such approval is required by applicable
          law. No termination or amendment of our 2013 Plan may adversely affect
          any then-outstanding award without the consent of the affected
          participant. As noted above, no further awards will be granted under
          our 2013 Plan on or after the effectiveness of our 2021 Plan; however,
          awards outstanding under our 2013 Stock Plan will continue to be
          governed by their existing terms.
       
          Limitations of Liability and Indemnification Matters
       
          On the completion of this offering, our amended and restated
          certificate of incorporation will contain provisions that limit the
          liability of our current and former directors for monetary damages to
          the fullest extent permitted by Delaware law. Delaware law provides
          that directors of a corporation will not be personally liable for
          monetary damages for any breach of fiduciary duties as directors,
          except liability for:
       
          •
       
          any breach of the director’s duty of loyalty to the corporation or its
          stockholders;
       
          •
       
          any act or omission not in good faith or that involves intentional
          misconduct or a knowing violation of law;
       
          •
       
          unlawful payments of dividends or unlawful stock repurchases or
          redemptions; or
       
          •
       
          any transaction from which the director derived an improper personal
          benefit.
       
          Such limitation of liability does not apply to liabilities arising
          under federal securities laws and does not affect the availability of
          equitable remedies such as injunctive relief or rescission.
       
          Our amended and restated certificate of incorporation that will be in
          effect on the completion of this offering will authorize us to
          indemnify our directors, officers, employees and other agents to the
          fullest extent permitted by Delaware law. Our amended and restated
          bylaws that will be in effect on the completion of this offering will
          provide that we are required to indemnify our directors and officers
          to the fullest extent permitted by Delaware law and may indemnify our
          other employees and agents. Our amended and restated bylaws that will
          be in effect on the completion of this offering will also provide
          that, on satisfaction of certain conditions, we will advance expenses
          incurred by a director or officer in advance of the final disposition
          of any action or proceeding, and permit us to secure insurance on
          behalf of any officer, director, employee or other agent for any
          liability arising out of his or her actions in that capacity
          regardless of whether we would otherwise be permitted to indemnify him
          or her under the provisions of Delaware law. We have entered and
          expect to continue to enter into agreements to indemnify our
          directors, executive officers and other employees as determined by the
          board of directors. With certain exceptions, these agreements provide
          for indemnification for related expenses including attorneys’ fees,
          judgments, fines and settlement amounts incurred by any of these
          individuals in any action or proceeding. We believe that these amended
          and restated certificate of incorporation and amended and restated
          bylaw provisions and indemnification agreements are necessary to
          attract and retain qualified persons as directors and officers. We
          also maintain customary directors’ and officers’ liability insurance.
       
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          The limitation of liability and indemnification provisions in our
          amended and restated certificate of incorporation and amended and
          restated bylaws may discourage stockholders from bringing a lawsuit
          against our directors for breach of their fiduciary duty. They may
          also reduce the likelihood of derivative litigation against our
          directors and officers, even though an action, if successful, might
          benefit us and other stockholders. Further, a stockholder’s investment
          may be adversely affected to the extent that we pay the costs of
          settlement and damage awards against directors and officers as
          required by these indemnification provisions.
       
          Insofar as indemnification for liabilities arising under the
          Securities Act may be permitted for directors, executive officers or
          persons controlling us, we have been informed that, in the opinion of
          the SEC, such indemnification is against public policy as expressed in
          the Securities Act and is therefore unenforceable.
       
          Rule 10b5-1 Sales Plans
       
          Our directors and officers may adopt written plans, known as
          Rule 10b5-1 plans, in which they will contract with a broker to buy or
          sell shares of our common stock on a periodic basis. Under a
          Rule 10b5-1 plan, a broker executes trades under parameters
          established by the director or officer when entering into the plan,
          without further direction from them. The director or officer may amend
          a Rule 10b5-1 plan in some circumstances and may terminate a plan at
          any time. Our directors and officers may also buy or sell additional
          shares outside of a Rule 10b5-1 plan when they do not possess of
          material nonpublic information, subject to compliance with the terms
          of our insider trading policy.
       
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          CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
       
          The following is a summary of transactions since January 1, 2017 to
          which we were a party or will be a party, in which:
       
          •
       
          the amounts involved exceeded or will exceed $120,000; and
       
          •
       
          any of our directors, executive officers or holders of more than 5% of
          our capital stock, or any affiliate or member of the immediate family
          of, or person sharing the household with, the foregoing persons, had
          or will have a direct or indirect material interest.
       
          The below discussion excludes compensation arrangements which are
          described in “Executive Compensation” and “Management—Non-Employee
          Director Compensation.”
       
          Series C Preferred Stock Financing
       
          On May 8, 2020, we sold an aggregate of 4,721,905 shares of our
          Series C Preferred Stock at a price per share of $10.58895 for an
          aggregate purchase price of approximately $50.0 million. All of the
          purchasers of our Series C Preferred Stock listed below are entitled
          to specified registration rights. See the section titled “Description
          of Capital Stock—Registration Rights” for more information regarding
          these registration rights. The following table sets forth the number
          of shares of our Series C Preferred Stock purchased by our executive
          officers, directors, holders of more than 5% of our share capital and
          their affiliated entities or immediate family members. Each share of
          Series C Preferred Stock in the table below will automatically convert
          into one common share upon the completion of this offering.
       
          Stockholder
       
          Shares of Series C
          Preferred Stock
       
          Total Purchase
          Price
       
          AI Droplet Holdings LLC(1)
       
          4,674,685
       
          $
       
          49,500,005.74
       
          Andreessen Horowitz Fund III, L.P.(2)
       
          32,434
       
          343,442.01
       
          AH Parallel Fund III, L.P.(2)
       
          14,786
       
          156,568.22
       
          (1)
       
          Pueo Keffer, a member of our board of directors, is a managing
          director of Access Technology Ventures, which is an affiliate of AI
          Droplet Holdings LLC. See the section titled “Principal Stockholders”
          for additional information regarding AI Droplet Holdings LLC.
       
          (2)
       
          Peter Levine, a member of our board of directors, is a general partner
          at Andreessen Horowitz, which is an affiliate of Andreessen Horowitz
          Fund III, L.P. and AH Parallel Fund III, L.P. See the section titled
          “Principal Stockholders” for additional information regarding
          Andreessen Horowitz Fund III, L.P. and AH Parallel Fund III, L.P.
       
          Assignment of Right of First Refusal
       
          From July 2018 to September 2020, AI Droplet Holdings LLC and its
          affiliated entities exercised our right of first refusal to purchase
          shares of our capital stock in secondary transactions, which we
          assigned to AI Droplet Holdings LLC from time to time. AI Droplet
          Holdings LLC is a holder of more than 5% of our capital stock and is
          affiliated with Pueo Keffer, who is a member of our board of
          directors. We discontinued the practice of assigning our right of
          first refusal to our stockholders in September 2020, and our right of
          first refusal to purchase shares of our capital stock will terminate
          upon the completion of this offering.
       
          Investors’ Rights, Voting, and Co-Sale Agreements
       
          In connection with our convertible preferred stock financings, we
          entered into investors’ rights, voting, and right of first refusal and
          co-sale agreements containing registration rights, information rights,
          voting rights with respect to the election of directors, co-sale
          rights and rights of first refusal, among other things, with certain
          holders of our capital stock. The parties to the investors’ rights
          agreement include Benya Uretsky, Moisey Uretsky and entities
          affiliated with AI Droplet Holdings LLC, Andreessen Horowitz Fund III,
          L.P. and IA
       
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          Venture Strategies Fund II, LP. The parties to the voting agreement
          include Benya Uretsky, Moisey Uretsky and entities affiliated with AI
          Droplet Holdings LLC, Andreessen Horowitz Fund III, L.P. and IA
          Venture Strategies Fund II, LP. The parties to the co-sale agreement
          include Benya Uretsky, Moisey Uretsky and entities affiliated with AI
          Droplet Holdings LLC, Andreessen Horowitz Fund III, L.P. and IA
          Venture Strategies Fund II, LP. These stockholder agreements will
          terminate upon the completion of this offering, except for the
          registration rights granted under our investors’ rights agreement, as
          more fully described in “Description of Capital Stock— Registration
          Rights.”
       
          Equity Grants to Directors and Executive Officers
       
          We have granted stock options and RSUs to certain of our directors and
          executive officers. For more information regarding the stock options
          and stock awards granted to our directors and named executive
          officers, see “Executive Compensation” and “Management—Non-Employee
          Director Compensation.”
       
          Indemnification Agreements
       
          Our amended and restated certificate of incorporation that will be in
          effect on the completion of this offering will contain provisions
          limiting the liability of directors, and our amended and restated
          bylaws that will be in effect on the completion of this offering will
          provide that we will indemnify each of our directors and officers to
          the fullest extent permitted under Delaware law. Our amended and
          restated certificate of incorporation and amended and restated bylaws
          that will be in effect on the completion of this offering will also
          provide our board of directors with discretion to indemnify our
          employees and other agents when determined appropriate by the board.
          In addition, we have entered into an indemnification agreement with
          each of our directors and executive officers, which requires us to
          indemnify them. For more information regarding these agreements, see
          the section titled “Executive Compensation—Limitations of Liability
          and Indemnification Matters.”
       
          Policies and Procedures for Transactions with Related Persons
       
          We have adopted a policy that our executive officers, directors,
          nominees for election as a director, beneficial owners of more than 5%
          of our common stock and any members of the immediate family of any of
          the foregoing persons are not permitted to enter into a related person
          transaction with us without the approval or ratification of our board
          of directors or our audit committee. Any request for us to enter into
          a transaction with an executive officer, director, nominee for
          election as a director, beneficial owner of more than 5% of our common
          stock or any member of the immediate family of any of the foregoing
          persons, in which the amount involved exceeds $120,000 and such person
          would have a direct or indirect interest, must be presented to our
          board of directors or our audit committee for review, consideration
          and approval. In approving or rejecting any such proposal, our board
          of directors or our audit committee is to consider the material facts
          of the transaction, including whether the transaction is on terms no
          less favorable than terms generally available to an unaffiliated third
          party under the same or similar circumstances and the extent of the
          related person’s interest in the transaction.
       
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          PRINCIPAL STOCKHOLDERS
       
          The following table sets forth information with respect to the
          beneficial ownership of our shares as of February 25, 2021, as
          adjusted to reflect our sale of common stock in this offering, by:
       
          •
       
          each of our named executive officers;
       
          •
       
          each of our directors;
       
          •
       
          all of our directors and executive officers as a group; and
       
          •
       
          each person or entity known by us to own beneficially more than 5% of
          our common stock (by number or by voting power).
       
          We have determined beneficial ownership in accordance with the rules
          and regulations of the SEC, and the information is not necessarily
          indicative of beneficial ownership for any other purpose. Except as
          indicated by the footnotes below, we believe, based on information
          furnished to us, that the persons and entities named in the table
          below have sole voting and sole investment power with respect to all
          shares that they beneficially own, subject to applicable community
          property laws.
       
          Applicable percentage ownership before the offering is based on
          89,360,744 shares of common stock outstanding as of February 25, 2021,
          assuming the automatic conversion of all outstanding shares of
          preferred stock into shares of common stock. Applicable percentage
          ownership after the offering is based on                    shares of
          common stock outstanding immediately after the completion of this
          offering, assuming no exercise by the underwriters of their option to
          purchase additional shares of common stock from us and giving effect
          to the sale of                    shares of our common stock by us. In
          computing the number of shares beneficially owned by a person and the
          percentage ownership of such person, we deemed to be outstanding all
          shares subject to options held by the person that are currently
          exercisable, or exercisable or would vest based on service-based
          vesting conditions within 60 days of February 25, 2021. However,
          except as described above, we did not deem such shares outstanding for
          the purpose of computing the percentage ownership of any other person.
       
          Unless otherwise indicated, the address for each beneficial owner
          listed in the table below is c/o DigitalOcean Holdings, Inc., 101 6th
          Avenue, New York, New York 10013.
       
          Shares Beneficially
          Owned Prior to Offering
       
          Shares Beneficially
          Owned After Offering
       
          Name of Beneficial Owner
       
          Shares
       
          Percentage
       
          Shares
       
          Percentage
       
          5% Stockholders
       
          Entities affiliated with AI Droplet Holdings LLC(1)
       
          23,737,790
       
          26.56
       
          % 
       
          Entities affiliated with Andreessen Horowitz Fund III, L.P.(2)
       
          15,662,344
       
          17.53
       
          % 
       
          Entities affiliated with IA Venture Strategies Fund II, LP(3)
       
          14,808,964
       
          16.57
       
          % 
       
          Benya Uretsky(4)
       
          6,515,621
       
          7.29
       
          % 
       
          Moisey Uretsky(5)
       
          8,073,078
       
          9.03
       
          % 
       
          Named Executive Officers and Directors
       
          Yancey Spruill(6)
       
          1,458,333
       
          1.61
       
          % 
       
          Carly Brantz(7)
       
          135,937
       
          *
       
          Jeffrey Guy(8)
       
          145,833
       
          *
       
          Warren Adelman(9)
       
          10,416
       
          *
       
          Pratima Arora
       
          —
       
          *
       
          Amy Butte(10)
       
          94,791
       
          *
       
          Warren Jenson(11)
       
          8,333
       
          *
       
          Pueo Keffer
       
          —
       
          *
       
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          Shares Beneficially
          Owned Prior to Offering
       
          Shares Beneficially
          Owned After Offering
       
          Name of Beneficial Owner
       
          Shares
       
          Percentage
       
          Shares
       
          Percentage
       
          Peter Levine
       
          —
       
          *
       
          Hilary Schneider(12)
       
          10,416
       
          *
       
          All executive officers and directors as a group (14 persons)
       
          2,907,391
       
          3.15
       
          % 
       
          *
       
          Represents beneficial ownership of less than 1%.
       
          (1)
       
          Consists of (a) 23,582,125 shares held directly by AI Droplet Holdings
          LLC, and (b) 155,665 shares held directly by AI Droplet Sharing LLC.
          Each of Access Industries Management, LLC (“AIM”) and Len Blavatnik
          may be deemed to beneficially own, and share investment and voting
          power over, the shares held directly by AI Droplet Holdings LLC
          because (i) AIM is the sole manager of AI Droplet Holdings LLC and
          (ii) Mr. Blavatnik controls AIM and a majority of the outstanding
          voting interests in AI Droplet Holdings LLC. Each of AIM and Mr.
          Blavatnik and each of their affiliated entities and the officers,
          partners, members, and managers thereof, other than AI Droplet
          Holdings LLC, disclaims beneficial ownership of the shares held
          directly by AI Droplet Holdings LLC. Each of AIM, Access Industries
          Holdings LLC (“AIH”) and Mr. Blavatnik may be deemed to beneficially
          own, and share investment and voting power over, the shares held
          directly by AI Droplet Sharing LLC because (i) AIM is the sole manager
          of AI Droplet Sharing LLC, (ii) AIH controls a majority of the
          outstanding voting interests in AI Droplet Sharing LLC and (iii) Mr.
          Blavatnik controls AIM and a majority of the outstanding voting
          interests in AIH. Each of AIM, AIH and Mr. Blavatnik and each of their
          affiliated entities and the officers, partners, members, and managers
          thereof, other than AI Droplet Sharing LLC, disclaims beneficial
          ownership of the shares held directly by AI Droplet Sharing LLC. The
          principal business address of the foregoing is 40 West 57th Street,
          28th Floor, New York, NY 10019.
       
          (2)
       
          Consists of (a) 10,757,990 shares held of record by Andreessen
          Horowitz Fund III, L.P., for itself and as nominee for Andreessen
          Horowitz Fund III-A, L.P., Andreessen Horowitz Fund III-B, L.P. and
          Andreessen Horowitz Fund III-Q, L.P. (collectively, the “AH Fund III
          Entities”) and (b) 4,904,354 shares held of record by AH Parallel Fund
          III, L.P., for itself and as nominee for AH Parallel Fund III-A, L.P.,
          AH Parallel Fund III-B, L.P. and AH Parallel Fund III-Q, L.P.
          (collectively, the “AH Parallel Fund III Entities”). AH Equity
          Partners III, L.L.C. (“AH EP III”) is the general partner of the AH
          Fund III Entities. The managing members of AH EP III are Marc
          Andreessen and Ben Horowitz. AH EP III has sole voting and dispositive
          power with regard to the shares held by the AH Fund III Entities. AH
          Equity Partners III (Parallel), L.L.C. (“AH EP III Parallel”) is the
          general partner of the AH Parallel Fund III Entities. The managing
          members of AH EP III Parallel are Marc Andreessen and Ben Horowitz. AH
          EP III Parallel has sole voting and dispositive power with regard to
          the shares held by the AH Parallel Fund III Entities. The principal
          business address of these entities is 2865 Sand Hill Road, Suite 101,
          Menlo Park, CA 94025.
       
          (3)
       
          Consists of (a) 14,492,848 shares held directly by IA Venture
          Strategies Fund II, LP (“IA Venture Fund”) and (b) 316,116 shares held
          directly by IA Venture Strategies II Side Fund, LP (“IA Venture Side
          Fund”). IA Venture Partners II, LLC is the general partner of IA
          Venture Fund and IA Venture Side Fund, LP. Roger Ehrenberg, Bradford
          Gillespie and Jesse Beyroutey are the members of IA Venture Partners
          II, LLC and may be deemed to have shared voting, investment and
          dispositive power with respect to the shares held by this entity. Mr.
          Ehrenberg and Mr. Beyrouty disclaim beneficial ownership with respect
          to such shares except to the extent of their pecuniary interest
          therein. The principal business address of IA Venture Partners II, LLC
          is 920 Broadway, 15th Floor, New York, NY 10010.
       
          (4)
       
          Consists of (a) 6,115,621 shares held by Mr. Uretsky and (b) 400,000
          shares held by the Uretsky Charitable Trust for which Mr. Uretsky acts
          as a trustee.
       
          (5)
       
          Consists of 8,073,078 shares held by Mr. Uretsky.
       
          (6)
       
          Consists of 1,458,333 shares issuable upon the exercise of options.
       
          (7)
       
          Consists of (a) 14,880 shares held by Ms. Brantz and (b) 121,057
          shares issuable upon the exercise of options.
       
          (8)
       
          Consists of 145,833 shares issuable upon the exercise of options.
       
          (9)
       
          Consists of 10,416 shares issuable upon the exercise of options.
       
          (10)
       
          Consists of 94,791 shares issuable upon the exercise of options held
          by Plato Partners LLC.
       
          (11)
       
          Consists of 8,333 shares issuable upon the exercise of options.
       
          (12)
       
          Consists of 10,416 shares issuable upon the exercise of options.
       
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          DESCRIPTION OF CAPITAL STOCK
       
          General
       
          The following description of our capital stock and certain provisions
          of our amended and restated certificate of incorporation and amended
          and restated bylaws are summaries and are qualified by reference to
          the amended and restated certificate of incorporation and the amended
          and restated bylaws that will be in effect on the completion of this
          offering. Copies of these documents have been filed with the SEC as
          exhibits to our registration statement, of which this prospectus
          forms a part. The descriptions of the common stock and preferred stock
          reflect changes to our capital structure that will be in effect on the
          completion of this offering.
       
          On the completion of this offering, our amended and restated
          certificate of incorporation will authorize shares of undesignated
          preferred stock, the rights, preferences and privileges of which may
          be designated from time to time by our board of directors.
       
          Upon the completion of this offering, our authorized capital stock
          will consist of 760,000,000 shares, all with a par value of $0.000025
          per share, of which:
       
          •
       
          750,000,000 shares are designated common stock; and
       
          •
       
          10,000,000 shares are designated preferred stock.
       
          As of December 31, 2020, we had outstanding 88,803,340 shares of
          common stock, which assumes the automatic conversion of 45,472,229
          outstanding shares of preferred stock into shares of common stock. Our
          outstanding capital stock was held by 362 stockholders of record as of
          December 31, 2020.
       
          Our board of directors is authorized, without stockholder approval
          except as required by the listing standards of the New York Stock
          Exchange to issue additional shares of our capital stock.
       
          Common Stock
       
          Voting rights. The common stock is entitled to one vote per share on
          any matter that is submitted to a vote of our stockholders, including
          the election of directors. Our amended and restated certificate of
          incorporation that will be in effect on the completion of this
          offering will not provide for cumulative voting for the election of
          directors. Accordingly, the holders of a majority of the outstanding
          shares of common stock entitled to vote in any election of directors
          can elect all of the directors standing for election, if they so
          choose, other than any directors that holders of any preferred stock
          we may issue may be entitled to elect.
       
          Dividend rights. Subject to preferences that may be applicable to any
          then outstanding preferred stock, holders of common stock are entitled
          to receive ratably those dividends, if any, as may be declared by the
          board of directors out of legally available funds.
       
          Rights upon liquidation. In the event of our liquidation, dissolution,
          or winding up, the holders of common stock will be entitled to share
          ratably in the assets legally available for distribution to
          stockholders after the payment of or provision for all of our debts
          and other liabilities, subject to the prior rights of any preferred
          stock then outstanding.
       
          Subdivisions and combinations. If we subdivide or combine in any
          manner outstanding shares of common stock, the outstanding shares of
          the other classes will be subdivided or combined in the same manner.
       
          Other rights. Holders of common stock have no preemptive or conversion
          rights or other subscription rights and there are no redemption or
          sinking funds provisions applicable to the common stock. All
          outstanding shares
       
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          of common stock are, and the common stock to be outstanding upon the
          completion of this offering will be, duly authorized, validly issued,
          fully paid, and nonassessable. The rights, preferences and privileges
          of holders of common stock are subject to and may be adversely
          affected by the rights of the holders of shares of any series of
          preferred stock that we may designate and issue in the future.
       
          Preferred Stock
       
          As of December 31, 2020, there were 45,472,229 shares of our preferred
          stock outstanding. In connection with this offering, each outstanding
          share of our preferred stock will convert into one share of our common
          stock.
       
          On the completion of this offering and under our amended and restated
          certificate of incorporation that will be in effect on the completion
          of this offering, our board of directors may, without further action
          by our stockholders, fix the rights, preferences, privileges and
          restrictions of up to an aggregate of 10,000,000 shares of preferred
          stock in one or more series and authorize their issuance. These
          rights, preferences and privileges could include dividend rights,
          conversion rights, voting rights, terms of redemption, liquidation
          preferences and the number of shares constituting any series or the
          designation of such series, any or all of which may be greater than
          the rights of our common stock. Any issuance of our preferred stock
          could adversely affect the voting power of holders of our common
          stock, and the likelihood that such holders would receive dividend
          payments and payments on liquidation. In addition, the issuance of
          preferred stock could have the effect of delaying, deferring or
          preventing a change of control or other corporate action. On the
          completion of this offering, no shares of preferred stock will be
          outstanding. We have no present plan to issue any shares of preferred
          stock.
       
          Warrants
       
          As of December 31, 2020, 308,632 shares of our Series A-1 preferred
          stock were issuable upon the exercise of outstanding warrants with a
          weighted-average exercise price of approximately $1.94 per share. In
          connection with the completion of the transaction, these warrants will
          automatically convert into warrants to purchase the same number of
          shares of common stock.
       
          Options
       
          As of December 31, 2020, we had outstanding options to purchase
          16,933,494 shares of our common stock with a weighted-average exercise
          price of approximately $6.73 per share, under our 2013 Plan.
       
          Restricted Stock Unit Awards
       
          As of December 31, 2020, we had outstanding 413,750 shares of our
          common stock subject to RSUs under our 2013 Plan.
       
          Registration Rights
       
          Stockholder Registration Rights
       
          We are party to an investor rights agreement that provides that
          certain holders of our preferred stock, including certain holders of
          at least 5% of our capital stock and entities affiliated with certain
          of our directors, have certain registration rights, as set forth
          below. The registration of shares of our common stock by the exercise
          of registration rights described below would enable the holders to
          sell these shares without restriction under the Securities Act when
          the applicable registration statement is declared effective. We will
          pay the registration expenses, other than underwriting discounts and
          commissions and legal fees in excess of $30,000 for each registration,
          of the shares registered by the demand, piggyback and Form S-3
          registrations described below.
       
          Generally, in an underwritten offering, the managing underwriter, if
          any, has the right, subject to specified conditions, to limit the
          number of shares such holders may include. The demand, piggyback and
          Form S-3
       
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          registration rights described below will expire upon the earliest to
          occur of (1) the five-year anniversary of the effective date of the
          registration statement, of which this prospectus is a part, (2) a
          liquidation transaction, as such term is defined in our then-current
          certificate of incorporation and (3) with respect to any particular
          stockholder, such earlier time after the effective date of the
          registration statement at which such stockholder (i) can sell all of
          its shares held by it in compliance with Rule 144(b)(1)(i) of the
          Securities Act or (ii) holds less than 1% of our outstanding common
          stock and all registrable securities held by such stockholder
          (together with any affiliate of such stockholder with whom such
          stockholder must aggregate its sales under Rule 144 of the Securities
          Act) can be sold in any three-month period without registration in
          compliance with Rule 144 of the Securities Act.
       
          Demand Registration Rights
       
          Following the completion of this offering, the holders of an aggregate
          of 45,780,861 shares of our common stock will be entitled to certain
          demand registration rights. At any time after six months after the
          completion of this offering, the holders of a majority of these shares
          may, on not more than two occasions, request that we register all or a
          portion of their shares on a registration statement on Form S-1. Such
          request for registration must cover shares with an anticipated
          aggregate offering price, net of underwriting discounts and
          commissions, of at least $15.0 million.
       
          Piggyback Registration Rights
       
          In connection with this offering, the holders of an aggregate of
          71,334,137 shares of our common stock, on an as-converted basis, were
          entitled to, and the necessary percentage of holders waived, their
          rights to notice of this offering and to include their shares of
          registrable securities in this offering. After this offering, in the
          event that we propose to register any of our common stock for the
          purposes of a public offering of such common stock, solely for cash,
          under the Securities Act, either for our own account or for the
          account of other security holders, the holders of these shares will be
          entitled to certain piggyback registration rights allowing the holder
          to include their shares in such registration, subject to certain
          marketing and other limitations. As a result, whenever we propose to
          file a registration statement to register sales of our common stock
          for the purposes of a public offering of such common stock, solely for
          cash, under the Securities Act, other than with respect to (1) a
          demand registration, (2) a registration relating solely to the sale of
          securities of participants in a Company stock plan or a transaction
          covered by Rule 145 under the Securities Act, (3) a registration in
          which the only stock being registered is common stock issuable upon
          conversion of debt securities which are also being registered, or
          (4) any registration on any form which does not include substantially
          the same information as would be required to be included in a
          registration statement covering the sale of registrable securities,
          the holders of these shares are entitled to notice of the registration
          and have the right to include their shares in the registration,
          subject to limitations that the underwriters may impose on the number
          of shares included in the offering.
       
          Form S-3 Registration Rights
       
          Following the completion of this offering, the holders of an aggregate
          of 45,780,861 shares of common stock will be entitled to certain
          Form S-3 registration rights. Any holder of these shares can make a
          request that we register their shares on a registration statement on
          Form S-3 if we are qualified to file a registration statement on
          Form S-3 and if the reasonably anticipated aggregate gross proceeds of
          the shares offered, net of underwriting discounts and commissions,
          would equal or exceed $3.0 million. We will not be required to effect
          more than two registrations on Form S-3 within any 12-month period.
       
          Anti-Takeover Provisions
       
          Certificate of Incorporation and Bylaws to be in Effect on the
          Completion of this Offering
       
          Because our stockholders do not have cumulative voting rights,
          stockholders holding a majority of the voting power of our shares of
          common stock will be able to elect all of our directors. Our amended
          and restated
       
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          certificate of incorporation and amended and restated bylaws to be
          effective on the completion of this offering will provide for
          stockholder actions at a duly called meeting of stockholders. A
          special meeting of stockholders may be called by a majority of our
          board of directors, the chair of our board of directors or our chief
          executive officer. Our amended and restated bylaws to be effective on
          the completion of this offering will establish an advance notice
          procedure for stockholder proposals to be brought before an annual
          meeting of our stockholders, including proposed nominations of persons
          for election to our board of directors. In addition, our amended and
          restated certificate of incorporation and amended and restated bylaws
          to be effective on the completion of this offering will eliminate the
          right of stockholders to act by written consent without a meeting.
       
          In accordance with our amended and restated certificate of
          incorporation to be effective on the completion of this offering,
          immediately after this offering, our board of directors will be
          divided into three classes with staggered three-year terms.
       
          The foregoing provisions will make it more difficult for another party
          to obtain control of us by replacing our board of directors. Since our
          board of directors has the power to retain and discharge our officers,
          these provisions could also make it more difficult for existing
          stockholders or another party to effect a change in management. In
          addition, the authorization of undesignated preferred stock makes it
          possible for our board of directors to issue preferred stock with
          voting or other rights or preferences that could impede the success of
          any attempt to change our control.
       
          These provisions are intended to preserve our existing control
          structure after completion of this offering, facilitate our continued
          innovation and the risk-taking that it requires, permit us to continue
          to prioritize our long-term goals rather than short-term results,
          enhance the likelihood of continued stability in the composition of
          our board of directors and its policies and to discourage certain
          types of transactions that may involve an actual or threatened
          acquisition of us. These provisions are also designed to reduce our
          vulnerability to an unsolicited acquisition proposal and to discourage
          certain tactics that may be used in proxy fights. However, such
          provisions could have the effect of discouraging others from making
          tender offers for our shares and may have the effect of deterring
          hostile takeovers or delaying changes in our control or management. As
          a consequence, these provisions may also inhibit fluctuations in the
          market price of our stock that could result from actual or rumored
          takeover attempts.
       
          Section 203 of the Delaware General Corporation Law
       
          When we have a class of voting stock that is either listed on a
          national securities exchange or held of record by more than 2,000
          stockholders, we will be subject to Section 203 of the Delaware
          General Corporation Law, which prohibits a Delaware corporation from
          engaging in any business combination with any interested stockholder
          for a period of three years after the date that such stockholder
          became an interested stockholder, subject to certain exceptions.
       
          Choice of Forum
       
          Our amended and restated certificate of incorporation to be effective
          on the completion of this offering will provide that the Court of
          Chancery of the State of Delaware be the exclusive forum for actions
          or proceedings brought under Delaware statutory or common law: (1) any
          derivative action or proceeding brought on our behalf; (2) any action
          asserting a breach of fiduciary duty; (3) any action asserting a claim
          against us arising under the Delaware General Corporation Law; (4) any
          action regarding our amended and restated certificate of incorporation
          or our amended and restated bylaws; (5) any action as to which the
          Delaware General Corporation Law confers jurisdiction to the Court of
          Chancery of the State of Delaware; or (6) any action asserting a claim
          against us that is governed by the internal affairs doctrine. This
          provision would not apply to claims brought to enforce a duty or
          liability created by the Securities Act, the Exchange Act or any other
          claim for which the federal courts have exclusive jurisdiction. Our
          amended and restated certificate of incorporation will further provide
          that the federal district courts of the United States of America will
          be the exclusive forum for resolving any complaint asserting a cause
          of action arising under the Securities Act.
       
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          Limitations of Liability and Indemnification
       
          See the section titled “Executive Compensation—Limitations of
          Liability and Indemnification Matters.”
       
          Exchange Listing
       
          Our common stock is currently not listed on any securities exchange.
          We have applied to have our common stock approved for listing on the
          New York Stock Exchange under the symbol “DOCN.”
       
          Transfer Agent and Registrar
       
          On the completion of this offering, the transfer agent and registrar
          for our common stock will be American Stock Transfer & Trust Company,
          LLC. The transfer agent’s address is 6201 15th Avenue, Brooklyn,
          New York 11219.
       
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          SHARES ELIGIBLE FOR FUTURE SALE
       
          Prior to this offering, there has been no public market for our common
          stock. Future sales of substantial amounts of our common stock,
          including shares issued on the exercise of outstanding options, in the
          public market after this offering, or the possibility of these sales
          or issuances occurring, could adversely affect the prevailing market
          price for our common stock or impair our ability to raise equity
          capital.
       
          Based on our shares outstanding as of December 31, 2020, on the
          completion of this offering, a total of                    shares of
          common stock will be outstanding, assuming the automatic conversion of
          all of our outstanding shares of preferred stock into an aggregate of
          45,472,229 shares of common stock. Of these shares, all of the common
          stock sold in this offering by us, plus any shares sold by us on
          exercise of the underwriters’ option to purchase additional common
          stock, will be freely tradable in the public market without
          restriction or further registration under the Securities Act, unless
          these shares are held by “affiliates,” as that term is defined in
          Rule 144 under the Securities Act.
       
          The remaining shares of common stock will be, and shares of common
          stock subject to stock options and RSUs will be on issuance,
          “restricted securities,” as that term is defined in Rule 144 under the
          Securities Act. These restricted securities are eligible for public
          sale only if they are registered under the Securities Act or if they
          qualify for an exemption from registration under Rules 144 or 701
          under the Securities Act, which are summarized below. Restricted
          securities may also be sold outside of the United States to non-U.S.
          persons in accordance with Rule 904 of Regulation S.
       
          Subject to the lock-up agreements described below and the provisions
          of Rule 144 or Regulation S under the Securities Act, as well as our
          insider trading policy, these restricted securities will be available
          for sale in the public market after the date of this prospectus.
       
          Rule 144
       
          In general, under Rule 144 as currently in effect, once we have been
          subject to public company reporting requirements of Section 13 or
          Section 15(d) of the Exchange Act for at least 90 days, an eligible
          stockholder is entitled to sell such shares without complying with the
          manner of sale, volume limitation or notice provisions of Rule 144,
          subject to compliance with the public information requirements of
          Rule 144. To be an eligible stockholder under Rule 144, such
          stockholder must not be deemed to have been one of our affiliates for
          purposes of the Securities Act at any time during the 90 days
          preceding a sale and must have beneficially owned the shares proposed
          to be sold for at least six months, including the holding period of
          any prior owner other than our affiliates. If such a person has
          beneficially owned the shares proposed to be sold for at least one
          year, including the holding period of any prior owner other than our
          affiliates, then such person is entitled to sell such shares without
          complying with any of the requirements of Rule 144, subject to the
          expiration of the lock-up agreements described below.
       
          In general, under Rule 144, as currently in effect, our affiliates or
          persons selling shares on behalf of our affiliates are entitled to
          sell shares on expiration of the lock-up agreements described below.
          Beginning 90 days after the date of this prospectus, within any
          three-month period, such stockholders may sell a number of shares that
          does not exceed the greater of:
       
          •
       
          1% of the number of common stock then outstanding, which will equal
          approximately                shares immediately after this offering,
          assuming no exercise of the underwriters’ option to purchase
          additional shares of common stock from us; or
       
          •
       
          the average weekly trading volume of our common stock on the New York
          Stock Exchange during the four calendar weeks preceding the filing of
          a notice on Form 144 with respect to such sale.
       
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          Sales under Rule 144 by our affiliates or persons selling shares on
          behalf of our affiliates are also subject to certain manner of sale
          provisions and notice requirements and to the availability of current
          public information about us.
       
          Rule 701
       
          Rule 701 generally allows a stockholder who was issued shares under a
          written compensatory plan or contract and who is not deemed to have
          been an affiliate of ours during the immediately preceding 90 days, to
          sell these shares in reliance on Rule 144, but without being required
          to comply with the public information, holding period, volume
          limitation or notice provisions of Rule 144. Rule 701 also permits
          affiliates of ours to sell their Rule 701 shares under Rule 144
          without complying with the holding period requirements of Rule 144.
          All holders of Rule 701 shares, however, are required by that rule to
          wait until 90 days after the date of this prospectus before selling
          those shares under Rule 701, subject to the expiration of the lock-up
          agreements described below.
       
          Form S-8 Registration Statements
       
          We intend to file one or more registration statements on Form S-8
          under the Securities Act with the SEC to register the offer and sale
          of shares of our common stock that are issuable under our 2013 Plan,
          2021 Plan and ESPP. These registration statements will become
          effective immediately on filing. Shares covered by these registration
          statements will then be eligible for sale in the public markets,
          subject to vesting restrictions, any applicable lock-up agreements
          described below, and Rule 144 limitations applicable to affiliates.
       
          Lock-up Arrangements
       
          We, and all of our directors, executive officers and the holders of
          substantially all of our common stock and securities exercisable for
          or convertible into our common stock outstanding immediately on the
          completion of this offering, have agreed, or will agree, with the
          underwriters that, until the opening of trading on the third trading
          day immediately following our release of earnings for the quarter
          ended June 30, 2021, subject to certain exceptions, we and they will
          not, without the prior written consent of Morgan Stanley & Co. LLC and
          either of Goldman Sachs & Co. LLC or J.P. Morgan Securities LLC,
          offer, sell, contract to sell, pledge, grant any option to purchase,
          make any short sale or otherwise dispose of any of our shares of
          common stock, any options or warrants to purchase any of our shares of
          common stock or any securities convertible into or exchangeable for or
          that represent the right to receive shares of our common stock;
          provided that:
       
          •
       
          up to 20% of the shares (calculating by including shares issuable upon
          exercise of vested and unvested options or RSUs and common stock) held
          by current employees and consultants immediately prior to this
          offering (but excluding current executive officers and directors) may
          be sold beginning at the commencement of trading on the later of (x)
          the first trading day following the 60th day after the date of this
          prospectus and (y) the third trading day immediately following our
          release of earnings for the quarter ended March 31, 2021; and
       
          •
       
          up to 20% of the shares (calculating by including shares issuable upon
          exercise of vested and unvested options or RSUs and common stock) held
          by any other stockholders immediately prior to this offering may be
          sold if, at any time beginning at the commencement of trading on the
          later of (x) the first trading day following the 60th day after the
          date of this prospectus and (y) the third trading day immediately
          following our release of earnings for the quarter ended March 31,
          2021, the last reported closing price of our common stock is at least
          33% greater than the initial public offering price of our common stock
          for 5 out of any 10 consecutive trading days, ending on or after the
          60th day after the date of this prospectus.
       
          These agreements are described in the section titled “Underwriting.”
          Morgan Stanley & Co. LLC and either of Goldman Sachs & Co. LLC or J.P.
          Morgan Securities LLC may release any of the securities subject to
          these lock-up agreements at any time, subject to applicable notice
          requirements.
       
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          In addition to the restrictions contained in the lock-up agreements
          described above, we have entered into agreements with all of our
          security holders that contain market stand-off provisions imposing
          restrictions on the ability of such security holders to offer, sell or
          transfer our equity securities for a period of 180 days following the
          date of this prospectus.
       
          Registration Rights
       
          Upon the completion of this offering, the holders of 45,472,229 shares
          of our common stock or their transferees, will be entitled to certain
          rights with respect to the registration of the offer and sale of their
          shares under the Securities Act. Registration of these shares under
          the Securities Act would result in the shares becoming freely tradable
          without restriction under the Securities Act immediately on the
          effectiveness of the registration. See the section titled “Description
          of Capital Stock—Registration Rights” for additional information.
       
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          MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES
       
          TO NON-U.S. HOLDERS OF OUR COMMON STOCK
       
          The following summary describes certain material U.S. federal income
          tax consequences of the acquisition, ownership and disposition of our
          common stock acquired in this offering by Non-U.S. Holders (as defined
          below). This discussion is not a complete analysis of all potential
          U.S. federal income tax consequences relating thereto, and does not
          deal with foreign, state and local consequences that may be relevant
          to Non-U.S. Holders in light of their particular circumstances, nor
          does it address the effect of alternative minimum tax, federal
          Medicare contribution tax on net investment income, or special tax
          accounting rules under Section 451(b) of the Code, or U.S. federal tax
          consequences (such as gift and estate taxes) other than income taxes.
          Special rules different from those described below may apply to
          certain Non-U.S. Holders that are subject to special treatment under
          the Code, such as financial institutions, insurance companies,
          tax-exempt organizations, broker-dealers and traders in securities,
          U.S. expatriates, “controlled foreign corporations,” “passive foreign
          investment companies,” corporations that accumulate earnings to avoid
          U.S. federal income tax, persons that hold our common stock as part of
          a “straddle,” “hedge,” “conversion transaction,” “synthetic security”
          or integrated investment or other risk reduction strategy, persons who
          acquire our common stock through the exercise of an option or
          otherwise as compensation, persons subject to the alternative minimum
          tax or federal Medicare contribution tax on net investment income,
          “qualified foreign pension funds” as defined in Section 897(l)(2) of
          the Code and entities all of the interests of which are held by
          qualified foreign pension funds, partnerships and other pass-through
          entities or arrangements, and investors in such pass-through entities
          or arrangements. Such Non-U.S. Holders are urged to consult their tax
          advisors to determine the U.S. federal, state, local and other tax
          consequences that may be relevant to them. Furthermore, the discussion
          below is based upon the provisions of the Code, and Treasury
          Regulations, rulings and judicial decisions thereunder as of the date
          hereof, and such authorities may be repealed, revoked or modified,
          perhaps retroactively, so as to result in U.S. federal income tax
          consequences different from those discussed below. We have not
          requested a ruling from the U.S. Internal Revenue Service, or the IRS,
          with respect to the statements made and the conclusions reached in the
          following summary, and there can be no assurance that the IRS will
          agree with such statements and conclusions. This discussion assumes
          that the Non-U.S. Holder holds our common stock as a “capital asset”
          within the meaning of Section 1221 of the Code (generally, property
          held for investment).
       
          This discussion is for informational purposes only and is not tax
          advice. Persons considering the purchase of our common stock pursuant
          to this offering should consult their tax advisors concerning the U.S.
          federal income, estate and other tax consequences of acquiring, owning
          and disposing of our common stock in light of their particular
          situations as well as any consequences arising under the laws of any
          other taxing jurisdiction, including any state, local or foreign tax
          consequences.
       
          For the purposes of this discussion, a “Non-U.S. Holder” is, for U.S.
          federal income tax purposes, a beneficial owner of common stock that
          is neither a U.S. Holder, nor a partnership (or other entity or
          arrangement treated as a partnership for U.S. federal income tax
          purposes regardless of its place of organization or formation). A
          “U.S. Holder” means a beneficial owner of common stock that is for
          U.S. federal income tax purposes any of the following:
       
          •
       
          an individual who is a citizen or resident of the United States;
       
          •
       
          a corporation or other entity treated as a corporation for U.S.
          federal income tax purposes created or organized in or under the laws
          of the United States, any state thereof or the District of Columbia;
       
          •
       
          an estate the income of which is subject to U.S. federal income
          taxation regardless of its source; or
       
          •
       
          a trust if it (1) is subject to the primary supervision of a court
          within the United States and one or more U.S. persons have the
          authority to control all substantial decisions of the trust or (2) has
          a valid election in effect under applicable U.S. Treasury Regulations
          to be treated as a U.S. person.
       
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          Distributions
       
          Distributions, if any, made on our common stock to a Non-U.S. Holder
          to the extent made out of our current or accumulated earnings and
          profits (as determined under U.S. federal income tax principles)
          generally will constitute dividends for U.S. tax purposes and will be
          subject to withholding tax at a 30% rate or such lower rate as may be
          specified by an applicable income tax treaty, subject to the
          discussions below regarding effectively connected income, backup
          withholding and foreign accounts. To obtain a reduced rate of
          withholding under a treaty, a Non-U.S. Holder generally will be
          required to provide us or the applicable withholding agent with a
          properly executed IRS Form W-8BEN (in the case of individuals) or IRS
          Form W-8BEN-E (in the case of entities), or other appropriate form,
          certifying the Non-U.S. Holder’s entitlement to benefits under that
          treaty. This certification must be provided prior to the payment of
          dividends and must be updated periodically. In the case of a Non-U.S.
          Holder that is an entity, Treasury Regulations and the relevant tax
          treaty provide rules to determine whether, for purposes of determining
          the applicability of a tax treaty, dividends will be treated as paid
          to the entity or to those holding an interest in that entity. If a
          Non-U.S. Holder holds stock through a financial institution or other
          agent acting on the Non-U.S. Holder’s behalf, the Non-U.S. Holder will
          be required to provide appropriate documentation to such agent. The
          Non-U.S. Holder’s agent generally will then be required to provide
          certification to us or the applicable withholding agent, either
          directly or through other intermediaries. If a Non-U.S. Holder is
          eligible for a reduced rate of U.S. federal withholding tax under an
          income tax treaty and does not timely file the required certification,
          the Non-U.S. Holder may be able to obtain a refund or credit of any
          excess amounts withheld by timely filing an appropriate claim for a
          refund with the IRS.
       
          We generally are not required to withhold tax on dividends paid to a
          Non-U.S. Holder that are effectively connected with the Non-U.S.
          Holder’s conduct of a trade or business within the United States (and,
          if required by an applicable income tax treaty, are attributable to a
          permanent establishment or fixed base that such Non-U.S. Holder
          maintains in the United States) if a properly executed IRS Form
          W-8ECI, stating that the dividends are so connected, is furnished to
          us or the applicable withholding agent (or, if stock is held through a
          financial institution or other agent, to such agent). In general, such
          effectively connected dividends will be subject to U.S. federal income
          tax, on a net-income basis at the regular rates applicable to U.S.
          persons. A corporate Non-U.S. Holder receiving effectively connected
          dividends may also be subject to an additional “branch profits tax,”
          which is imposed at a rate of 30% (or such lower rate as may be
          specified by an applicable income tax treaty) on the corporate
          Non-U.S. Holder’s effectively connected earnings and profits, subject
          to certain adjustments. Non-U.S. Holders should consult their tax
          advisors regarding any applicable income tax treaties that may provide
          for different rules.
       
          To the extent distributions on our common stock, if any, exceed our
          current and accumulated earnings and profits, they will first reduce
          the Non-U.S. Holder’s adjusted basis in our common stock, but not
          below zero, and then will be treated as gain to the extent of any
          excess amount distributed, and taxed in the same manner as gain
          realized from a sale or other disposition of common stock as described
          in the next section.
       
          Gain on Disposition of Our Common Stock
       
          Subject to the discussions below regarding backup withholding and
          foreign accounts, a Non-U.S. Holder generally will not be subject to
          U.S. federal income tax with respect to gain realized on a sale or
          other disposition of our common stock unless (a) the gain is
          effectively connected with a trade or business of such Non-U.S. Holder
          in the United States (and, if required by an applicable income tax
          treaty, is attributable to a permanent establishment or fixed base
          that such holder maintains in the United States), (b) the Non-U.S.
          Holder is a nonresident alien individual and is present in the United
          States for 183 or more days in the taxable year of the disposition and
          certain other conditions are met or (c) we are or have been a “United
          States real property holding corporation” within the meaning of Code
          Section 897(c)(2) at any time within the shorter of the five-year
          period preceding such disposition or such Non-U.S. Holder holding
          period. In general, we would be a United States real property holding
          corporation if our interests in U.S. real estate comprise (by fair
          market value) at least half of our business assets. We believe that we
          have not been and we are not, and do not anticipate becoming, a United
          States real property holding corporation.
       
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          A Non-U.S. Holder described in (a) above will be required to pay tax
          on the net gain derived from the sale at regular U.S. federal income
          tax rates, and corporate Non-U.S. Holders described in (a) above may
          be subject to the additional branch profits tax at a 30% rate or such
          lower rate as may be specified by an applicable income tax treaty.
          Gain described in (b) above will be subject to U.S. federal income tax
          at a flat 30% rate or such lower rate as may be specified by an
          applicable income tax treaty, which gain may be offset by certain
          U.S.-source capital losses (even though the Non-U.S. Holder is not
          considered a resident of the United States), provided that the
          Non-U.S. Holder has timely filed U.S. federal income tax returns with
          respect to such losses.
       
          Information Reporting Requirements and Backup Withholding
       
          Generally, we must report information to the IRS with respect to any
          dividends we pay on our common stock (even if the payments are exempt
          from withholding), including the amount of any such dividends, the
          name and address of the recipient and the amount, if any, of tax
          withheld. A similar report is sent to the Non-U.S. Holder to whom any
          such dividends are paid. Pursuant to tax treaties or certain other
          agreements, the IRS may make its reports available to tax authorities
          in the recipient’s country of residence.
       
          Dividends paid by us (or our paying agents) to a Non-U.S. Holder may
          also be subject to U.S. backup withholding (currently at a rate of
          24%). U.S. backup withholding generally will not apply to a Non-U.S.
          Holder who provides a properly executed IRS Form W-8BEN, IRS Form
          W-8BEN-E or IRS Form W-ECI (as applicable), or otherwise establishes
          an exemption. Notwithstanding the foregoing, backup withholding may
          apply if the payer has actual knowledge, or reason to know, that the
          holder is a U.S. person who is not an exempt recipient.
       
          U.S. information reporting and, subject to satisfaction of the above
          requirements for establishing an exemption, backup withholding
          requirements generally will apply to the proceeds of a disposition of
          our common stock effected by or through a U.S. office of any broker,
          U.S. or foreign. Generally, U.S. information reporting and backup
          withholding requirements will not apply to a payment of disposition
          proceeds to a Non-U.S. Holder where the transaction is effected
          outside the United States through a non-U.S. office of a non-U.S.
          broker. Information reporting and backup withholding requirements may,
          however, apply to a payment of disposition proceeds if the broker has
          actual knowledge, or reason to know, that the holder is, in fact, a
          U.S. person. For information reporting purposes, certain brokers with
          substantial U.S. ownership or operations will generally be treated in
          a manner similar to U.S. brokers.
       
          Backup withholding is not an additional tax. Any amounts withheld
          under the backup withholding rules may be credited against the tax
          liability of persons subject to backup withholding, provided that the
          required information is timely furnished to the IRS.
       
          Foreign Accounts
       
          Sections 1471 through 1474 of the Code (commonly referred to as FATCA)
          impose a U.S. federal withholding tax of 30% on certain payments made
          to a foreign financial institution (as specifically defined by
          applicable rules) unless such institution enters into an agreement
          with the U.S. government to withhold on certain payments and to
          collect and provide to the U.S. tax authorities substantial
          information regarding U.S. account holders of such institution (which
          includes certain equity holders of such institution, as well as
          certain account holders that are foreign entities with U.S. owners).
          FATCA also generally imposes a federal withholding tax of 30% on
          certain payments to a non-financial foreign entity unless such entity
          provides the withholding agent with either a certification that it
          does not have any substantial direct or indirect U.S. owners or
          provides information regarding substantial direct and indirect U.S.
          owners of the entity. An intergovernmental agreement between the
          United States and an applicable foreign country may modify those
          requirements. The withholding tax described above will not apply if
          the foreign financial institution or non-financial foreign entity
          otherwise qualifies for an exemption from the rules.
       
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          The withholding provisions described above currently apply to payments
          of dividends, and, subject to the proposed Treasury Regulations
          described below, will apply to payments of gross proceeds from a sale
          or other disposition of common stock.
       
          The U.S. Treasury Department released proposed regulations which, if
          finalized in their present form, would eliminate the federal
          withholding tax of 30% applicable to the gross proceeds of a
          disposition of our common stock. In its preamble to such proposed
          regulations, the U.S. Treasury Department stated that taxpayers may
          generally rely on the proposed regulations until final regulations are
          issued. Non-U.S. Holders are encouraged to consult with their tax
          advisors regarding the possible implications of FATCA on their
          investment in our common stock.
       
          EACH PROSPECTIVE INVESTOR SHOULD CONSULT ITS OWN TAX ADVISOR REGARDING
          THE TAX CONSEQUENCES OF PURCHASING, HOLDING AND DISPOSING OF OUR
          COMMON STOCK, INCLUDING THE CONSEQUENCES OF ANY RECENT OR PROPOSED
          CHANGE IN APPLICABLE LAW.
       
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          UNDERWRITING
       
          Under the terms and subject to the conditions in an underwriting
          agreement dated the date of this prospectus, the underwriters named
          below, for whom Morgan Stanley & Co. LLC, Goldman Sachs & Co. LLC and
          J.P. Morgan Securities LLC are acting as representatives, have
          severally agreed to purchase, and we have agreed to sell to them,
          severally, the number of shares indicated below:
       
          Name
       
          Number of Shares
       
          Morgan Stanley & Co. LLC
       
          Goldman Sachs & Co. LLC
       
          J.P. Morgan Securities LLC
       
          BofA Securities, Inc.
       
          Barclays Capital Inc.
       
          KeyBanc Capital Markets Inc.
       
          Canaccord Genuity LLC
       
          JMP Securities LLC
       
          Stifel, Nicolaus & Company, Incorporated
       
          Total:
       
          The underwriters and the representatives are collectively referred to
          as the “underwriters” and the “representatives,” respectively. The
          underwriters are offering the shares of common stock subject to their
          acceptance of the shares from us and subject to prior sale. The
          underwriting agreement provides that the obligations of the several
          underwriters to pay for and accept delivery of the shares of common
          stock offered by this prospectus are subject to the approval of
          certain legal matters by their counsel and to certain other
          conditions. The underwriters are obligated to take and pay for all of
          the shares of common stock offered by this prospectus if any such
          shares are taken. However, the underwriters are not required to take
          or pay for the shares covered by the underwriters’ over-allotment
          option described below.
       
          The underwriters initially propose to offer part of the shares of
          common stock directly to the public at the offering price listed on
          the cover page of this prospectus and part to certain dealers at a
          price that represents a concession not in excess of $             per
          share under the public offering price. After the initial offering of
          the shares of common stock, the offering price and other selling terms
          may from time to time be varied by the representatives.
       
          We have granted to the underwriters an option, exercisable for 30 days
          from the date of this prospectus, to purchase up to additional shares
          of common stock at the public offering price listed on the cover page
          of this prospectus, less underwriting discounts and commissions. The
          underwriters may exercise this option solely for the purpose of
          covering over-allotments, if any, made in connection with the offering
          of the shares of common stock offered by this prospectus. To the
          extent the option is exercised, each underwriter will become
          obligated, subject to certain conditions, to purchase about the same
          percentage of the additional shares of common stock as the number
          listed next to the underwriter’s name in the preceding table bears to
          the total number of shares of common stock listed next to the names of
          all underwriters in the preceding table.
       
          The following table shows the per share and total public offering
          price, underwriting discounts and commissions, and proceeds before
          expenses to us. These amounts are shown assuming both no exercise and
          full exercise of the underwriters’ option to purchase up to an
          additional                    shares of common stock.
       
          Total
       
          Per
          Share
       
          No Exercise
       
          Full
          Exercise
       
          Public offering price
       
          $
       
          $
       
          $
       
          Underwriting discounts and commissions to be paid by us
       
          $
       
          $
       
          $
       
          Proceeds, before expenses, to us
       
          $
       
          $
       
          $
       
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          The estimated offering expenses payable by us, exclusive of the
          underwriting discounts and commissions, are approximately
          $            . We have agreed to reimburse the underwriters for
          expenses relating to clearance of this offering with the Financial
          Industry Regulatory Authority up to $            .
       
          We have applied to list our common stock on the New York Stock
          Exchange under the symbol “DOCN.”
       
          We, and all our directors, executive officers and the holders of
          substantially all of our common stock and securities exercisable for
          or convertible into our common stock outstanding immediately on the
          completion of this offering, have agreed that, without the prior
          written consent of Morgan Stanley & Co. LLC and either of Goldman
          Sachs & Co. LLC or J.P. Morgan Securities LLC, on behalf of the
          underwriters, we and they will not, and will not publicly disclose an
          intention to, during the period ending on the opening of trading on
          the third trading day immediately following our release of earnings
          for the quarter ended June 30, 2021 and subject to certain exceptions
          (the “restricted period”):
       
          •
       
          offer, pledge, sell, contract to sell, sell any option or contract to
          purchase, purchase any option or contract to sell, grant any option,
          right or warrant to purchase, lend or otherwise transfer or dispose
          of, directly or indirectly, any shares of common stock or any
          securities convertible into or exercisable or exchangeable for shares
          of common stock;
       
          •
       
          file any registration statement with the Securities and Exchange
          Commission relating to the offering of any shares of common stock or
          any securities convertible into or exercisable or exchangeable for
          common stock; or
       
          •
       
          enter into any swap or other arrangement that transfers to another, in
          whole or in part, any of the economic consequences of ownership of the
          common stock,
       
          whether any such transaction described above is to be settled by
          delivery of common stock or such other securities, in cash or
          otherwise; provided that:
       
          •
       
          up to 20% of the shares (calculating by including shares issuable upon
          exercise of vested and unvested options or RSUs and common stock) held
          by current employees and consultants immediately prior to this
          offering (but excluding current executive officers and directors) may
          be sold beginning at the commencement of trading on the later of (x)
          the first trading day following the 60th day after the date of this
          prospectus and (y) the third trading day immediately following our
          release of earnings for the quarter ended March 31, 2021; and
       
          •
       
          up to 20% of the shares (calculating by including shares issuable upon
          exercise of vested and unvested options or RSUs and common stock) held
          by any other stockholders immediately prior to this offering may be
          sold if, at any time beginning at the commencement of trading on the
          later of (x) the first trading day following the 60th day after the
          date of this prospectus and (y) the third trading day immediately
          following our release of earnings for the quarter ended March 31,
          2021, the last reported closing price of our common stock is at least
          33% greater than the initial public offering price of our common stock
          for 5 out of any 10 consecutive trading days, ending on or after the
          60th day after the date of this prospectus.
       
          In addition, we and each such person agrees that, without the prior
          written consent of Morgan Stanley & Co. LLC and either of Goldman
          Sachs & Co. LLC or J.P. Morgan Securities LLC, on behalf of the
          underwriters, we or such other person will not, during the restricted
          period, make any demand for, or exercise any right with respect to,
          the registration of any shares of common stock or any security
          convertible into or exercisable or exchangeable for common stock.
       
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          Morgan Stanley & Co. LLC and either of Goldman Sachs & Co. LLC or J.P.
          Morgan Securities LLC, in their sole discretion, may release the
          common stock and other securities subject to the lock-up agreements
          described above in whole or in part at any time, subject to applicable
          notice requirements.
       
          In order to facilitate the offering of the common stock, the
          underwriters may engage in transactions that stabilize, maintain or
          otherwise affect the price of the common stock. Specifically, the
          underwriters may sell more shares than they are obligated to purchase
          under the underwriting agreement, creating a short position. A short
          sale is covered if the short position is no greater than the number of
          shares available for purchase by the underwriters under the
          over-allotment option. The underwriters can close out a covered short
          sale by exercising the over-allotment option or purchasing shares in
          the open market. In determining the source of shares to close out a
          covered short sale, the underwriters will consider, among other
          things, the open market price of shares compared to the price
          available under the over-allotment option. The underwriters may also
          sell shares in excess of the over-allotment option, creating a naked
          short position. The underwriters must close out any naked short
          position by purchasing shares in the open market. A naked short
          position is more likely to be created if the underwriters are
          concerned that there may be downward pressure on the price of the
          common stock in the open market after pricing that could adversely
          affect investors who purchase in this offering. As an additional means
          of facilitating this offering, the underwriters may bid for, and
          purchase, shares of common stock in the open market to stabilize the
          price of the common stock. These activities may raise or maintain the
          market price of the common stock above independent market levels or
          prevent or retard a decline in the market price of the common stock.
          The underwriters are not required to engage in these activities and
          may end any of these activities at any time.
       
          We and the underwriters have agreed to indemnify each other against
          certain liabilities, including liabilities under the Securities Act.
       
          A prospectus in electronic format may be made available on websites
          maintained by one or more underwriters, or selling group members, if
          any, participating in this offering. The representatives may agree to
          allocate a number of shares of common stock to underwriters for sale
          to their online brokerage account holders. Internet distributions will
          be allocated by the representatives to underwriters that may make
          Internet distributions on the same basis as other allocations.
       
          The underwriters and their respective affiliates are full service
          financial institutions engaged in various activities, which may
          include securities trading, commercial and investment banking,
          financial advisory, investment management, investment research,
          principal investment, hedging, financing and brokerage activities.
       
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          Certain of the underwriters and their respective affiliates have, from
          time to time, performed, and may in the future perform, various
          financial advisory and investment banking services for us, for which
          they received or will receive customary fees and expenses.
       
          In addition, in the ordinary course of their various business
          activities, the underwriters and their respective affiliates may make
          or hold a broad array of investments and actively trade debt and
          equity securities (or related derivative securities) and financial
          instruments (including bank loans) for their own account and for the
          accounts of their customers and may at any time hold long and short
          positions in such securities and instruments. Such investment and
          securities activities may involve our securities and instruments. The
          underwriters and their respective affiliates may also make investment
          recommendations or publish or express independent research views in
          respect of such securities or instruments and may at any time hold, or
          recommend to clients that they acquire, long or short positions in
          such securities and instruments.
       
          Pricing of the Offering
       
          Prior to this offering, there has been no public market for our common
          stock. The initial public offering price was determined by
          negotiations between us and the representatives. Among the factors
          considered in determining the initial public offering price were our
          future prospects and those of our industry in general, our sales,
          earnings and certain other financial and operating information in
          recent periods, and the price-earnings ratios, price-sales ratios,
          market prices of securities, and certain financial and operating
          information of companies engaged in activities similar to ours.
       
          Selling Restrictions
       
          United Kingdom
       
          In relation to the United Kingdom, no shares have been offered or will
          be offered pursuant to the offering to the public in the United
          Kingdom prior to the publication of a prospectus in relation to the
          Shares which has been approved by the Financial Conduct Authority in
          accordance with the UK Prospectus Regulation, except that it may make
          an offer to the public in the United Kingdom of any Shares at any time
          under the following exemptions under the UK Prospectus Regulation:
       
          (a)
       
          to any legal entity which is a qualified investor as defined under the
          UK Prospectus Regulation;
       
          (b)
       
          to fewer than 150 natural or legal persons (other than qualified
          investors as defined under the UK Prospectus Regulation), subject to
          obtaining the prior consent of the representatives for any such offer;
          or
       
          (c)
       
          in any other circumstances falling within Article 1(4) of the UK
          Prospectus Regulation,
       
          provided that no such offer of the Shares shall require the Issuer or
          any Manager to publish a prospectus pursuant to Article 3 of the UK
          Prospectus Regulation or supplement a prospectus pursuant to Article
          23 of the UK Prospectus Regulation.
       
          In the United Kingdom, the offering is only addressed to, and is
          directed only at, “qualified investors” within the meaning of Article
          2(e) of the UK Prospectus Regulation, who are also (i) persons having
          professional experience in matters relating to investments who fall
          within the definition of “investment professionals” in Article 19(5)
          of the Financial Services and Markets Act 2000 (Financial Promotion)
          Order 2005 (the “Order”); (ii) high net worth bodies corporate,
          unincorporated associations and partnerships and trustees of high
          value trusts as described in Article 49(2) of the Order; or (iii)
          persons to whom it may otherwise lawfully be communicated (all such
          persons being referred to as “relevant persons”). This document must
          not be acted on or relied on by persons who are not relevant persons.
          Any investment or investment activity to which this document relates
          is available only to relevant persons and will be engaged in only with
          relevant persons.
       
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          For the purposes of this provision, the expression an “offer to the
          public” in relation to the Shares in the United Kingdom means the
          communication in any form and by any means of sufficient information
          on the terms of the offering and any Shares to be offered so as to
          enable an investor to decide to purchase or subscribe for any Shares,
          and the expression “UK Prospectus Regulation” means the UK version of
          Regulation (EU) No 2017/1129 as amended by The Prospectus (Amendment
          etc.) (EU Exit) Regulations 2019, which is part of UK law by virtue of
          the European Union (Withdrawal) Act 2018.
       
          European Economic Area
       
          In relation to each Member State of the European Economic Area (each
          an “EEA State”), no shares have been offered or will be offered
          pursuant to the offering to the public in that EEA State prior to the
          publication of a prospectus in relation to the Shares which has been
          approved by the competent authority in that EEA State or, where
          appropriate, approved in another EEA State and notified to the
          competent authority in that EEA State, all in accordance with the EU
          Prospectus Regulation, except that it may make an offer to the public
          in that EEA State of any Shares at any time under the following
          exemptions under the EU Prospectus Regulation:
       
          (a)
       
          to any legal entity which is a qualified investor as defined under the
          EU Prospectus Regulation;
       
          (b)
       
          to fewer than 150 natural or legal persons (other than qualified
          investors as defined under the EU Prospectus Regulation), subject to
          obtaining the prior consent of representatives for any such offer; or
       
          (c)
       
          in any other circumstances falling within Article 1(4) of the EU
          Prospectus Regulation, provided that no such offer of the Shares shall
          require the Issuer or any Manager to publish a prospectus pursuant to
          Article 3 of the EU Prospectus Regulation or supplement a prospectus
          pursuant to Article 23 of the EU Prospectus Regulation.
       
          For the purposes of this provision, the expression an “offer to the
          public” in relation to the Shares in any EEA State means the
          communication in any form and by any means of sufficient information
          on the terms of the offer and any Shares to be offered so as to enable
          an investor to decide to purchase or subscribe for any Shares, and the
          expression “EU Prospectus Regulation” means Regulation (EU) 2017/1129.
       
          Canada
       
          The shares may be sold only to purchasers purchasing, or deemed to be
          purchasing, as principal that are accredited investors, as defined in
          National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1)
          of the Securities Act (Ontario), and are permitted clients, as defined
          in National Instrument 31-103 Registration Requirements, Exemptions
          and Ongoing Registrant Obligations. Any resale of the shares must be
          made in accordance with an exemption from, or in a transaction not
          subject to, the prospectus requirements of applicable securities laws.
       
          Securities legislation in certain provinces or territories of Canada
          may provide a purchaser with remedies for rescission or damages if
          this prospectus (including any amendment thereto) contains a
          misrepresentation, provided that the remedies for rescission or
          damages are exercised by the purchaser within the time limit
          prescribed by the securities legislation of the purchaser’s province
          or territory. The purchaser should refer to any applicable provisions
          of the securities legislation of the purchaser’s province or territory
          for particulars of these rights or consult with a legal advisor.
       
          Pursuant to section 3A.3 (or, in the case of securities issued or
          guaranteed by the government of a non-Canadian jurisdiction, section
          3A.4) of National Instrument 33-105 Underwriting Conflicts (NI
          33-105), the underwriters are not required to comply with the
          disclosure requirements of NI 33-105 regarding underwriter conflicts
          of interest in connection with this offering.
       
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          Australia
       
          No placement document, prospectus, product disclosure statement or
          other disclosure document has been lodged with the Australian
          Securities and Investments Commission (“ASIC”), in relation to the
          offering. This prospectus does not constitute a prospectus, product
          disclosure statement or other disclosure document under the
          Corporations Act 2001 (the “Corporations Act”), and does not purport
          to include the information required for a prospectus, product
          disclosure statement or other disclosure document under the
          Corporations Act.
       
          Any offer in Australia of the shares may only be made to persons (the
          “Exempt Investors”) who are “sophisticated investors” (within the
          meaning of section 708(8) of the Corporations Act), “professional
          investors” (within the meaning of section 708(11) of the Corporations
          Act) or otherwise pursuant to one or more exemptions contained in
          section 708 of the Corporations Act so that it is lawful to offer the
          shares without disclosure to investors under Chapter 6D of the
          Corporations Act.
       
          The shares applied for by Exempt Investors in Australia must not be
          offered for sale in Australia in the period of 12 months after the
          date of allotment under the offering, except in circumstances where
          disclosure to investors under Chapter 6D of the Corporations Act would
          not be required pursuant to an exemption under section 708 of the
          Corporations Act or otherwise or where the offer is pursuant to a
          disclosure document which complies with Chapter 6D of the Corporations
          Act. Any person acquiring shares must observe such Australian on-sale
          restrictions.
       
          This prospectus contains general information only and does not take
          account of the investment objectives, financial situation or
          particular needs of any particular person. It does not contain any
          securities recommendations or financial product advice. Before making
          an investment decision, investors need to consider whether the
          information in this prospectus is appropriate to their needs,
          objectives and circumstances, and, if necessary, seek expert advice on
          those matters.
       
          Switzerland
       
          This document is not intended to constitute an offer or solicitation
          to purchase or invest in the securities. The securities may not be
          publicly offered, directly or indirectly, in Switzerland within the
          meaning of the Swiss Financial Services Act (“FinSA”) and no
          application has or will be made to admit the securities to trading on
          any trading venue (exchange or multilateral trading facility) in
          Switzerland. Neither this document nor any other offering or marketing
          material relating to the securities constitutes a prospectus pursuant
          to the FinSA, and neither this document nor any other offering or
          marketing material relating to the securities may be publicly
          distributed or otherwise made publicly available in Switzerland.
       
          Japan
       
          No registration pursuant to Article 4, paragraph 1 of the Financial
          Instruments and Exchange Law of Japan (Law No. 25 of 1948, as amended)
          (the “FIEL”) has been made or will be made with respect to the
          solicitation of the application for the acquisition of the shares of
          common stock.
       
          Accordingly, the shares of common stock have not been, directly or
          indirectly, offered or sold and will not be, directly or indirectly,
          offered or sold in Japan or to, or for the benefit of, any resident of
          Japan (which term as used herein means any person resident in Japan,
          including any corporation or other entity organized under the laws of
          Japan) or to others for re-offering or re-sale, directly or
          indirectly, in Japan or to, or for the benefit of, any resident of
          Japan except pursuant to an exemption from the registration
          requirements, and otherwise in compliance with, the FIEL and the other
          applicable laws and regulations of Japan.
       
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          For Qualified Institutional Investors (“QII”)
       
          Please note that the solicitation for newly-issued or secondary
          securities (each as described in Paragraph 2, Article 4 of the FIEL)
          in relation to the shares of common stock constitutes either a “QII
          only private placement” or a “QII only secondary distribution” (each
          as described in Paragraph 1, Article 23-13 of the FIEL). Disclosure
          regarding any such solicitation, as is otherwise prescribed in
          Paragraph 1, Article 4 of the FIEL, has not been made in relation to
          the shares of common stock. The shares of common stock may only be
          transferred to QIIs.
       
          For Non-QII Investors
       
          Please note that the solicitation for newly-issued or secondary
          securities (each as described in Paragraph 2, Article 4 of the FIEL)
          in relation to the shares of common stock constitutes either a “small
          number private placement” or a “small number private secondary
          distribution” (each as is described in Paragraph 4, Article 23-13 of
          the FIEL). Disclosure regarding any such solicitation, as is otherwise
          prescribed in Paragraph 1, Article 4 of the FIEL, has not been made in
          relation to the shares of common stock. The shares of common stock may
          only be transferred en bloc without subdivision to a single investor.
       
          Dubai International Financial Centre
       
          This prospectus relates to an Exempt Offer in accordance with the
          Offered Securities Rules of the Dubai Financial Services Authority
          (“DFSA”). This prospectus is intended for distribution only to persons
          of a type specified in the Offered Securities Rules of the DFSA. It
          must not be delivered to, or relied on by, any other person. The DFSA
          has no responsibility for reviewing or verifying any documents in
          connection with Exempt Offers. The DFSA has not approved this
          prospectus nor taken steps to verify the information set forth herein
          and has no responsibility for the prospectus. The shares to which this
          prospectus relates may be illiquid and/or subject to restrictions on
          their resale. Prospective purchasers of the shares offered should
          conduct their own due diligence on the shares. If you do not
          understand the contents of this prospectus you should consult an
          authorized financial advisor.
       
          Hong Kong
       
          The shares may not be offered or sold in Hong Kong by means of any
          document other than (i) in circumstances which do not constitute an
          offer to the public within the meaning of the Companies (Winding Up
          and Miscellaneous Provisions) Ordinance (Cap. 32 of the Laws of Hong
          Kong), or the Companies (Winding Up and Miscellaneous Provisions)
          Ordinance, or which do not constitute an invitation to the public
          within the meaning of the Securities and Futures Ordinance (Cap. 571
          of the Laws of Hong Kong), or the Securities and Futures Ordinance, or
          (ii) to “professional investors” as defined in the Securities and
          Futures Ordinance and any rules made thereunder, or (iii) in other
          circumstances which do not result in the document being a “prospectus”
          as defined in the Companies (Winding Up and Miscellaneous Provisions)
          Ordinance, and no advertisement, invitation or document relating to
          the shares may be issued or may be in the possession of any person for
          the purpose of issue (in each case whether in Hong Kong or elsewhere),
          which is directed at, or the contents of which are likely to be
          accessed or read by, the public in Hong Kong (except if permitted to
          do so under the securities laws of Hong Kong) other than with respect
          to shares which are or are intended to be disposed of only to persons
          outside Hong Kong or only to “professional investors” in Hong Kong as
          defined in the Securities and Futures Ordinance and any rules made
          thereunder.
       
          Singapore
       
          This prospectus has not been registered as a prospectus with the
          Monetary Authority of Singapore. Accordingly, this prospectus and any
          other document or material in connection with the offer or sale, or
          invitation for subscription or purchase, of the shares may not be
          circulated or distributed, nor may the shares be offered or sold, or
          be made the subject of an invitation for subscription or purchase,
          whether directly or indirectly, to persons in Singapore other than
          (i) to an institutional investor (as defined under Section 4A of the
          Securities and Futures Act, Chapter 289 of Singapore, or the SFA)
          under Section 274 of the SFA, (ii) to a
       
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          relevant person (as defined in Section 275(2) of the SFA) pursuant to
          Section 275(1) of the SFA, or any person pursuant to Section 275(1A)
          of the SFA, and in accordance with the conditions specified in
          Section 275 of the SFA or (iii) otherwise pursuant to, and in
          accordance with the conditions of, any other applicable provision of
          the SFA, in each case subject to conditions set forth in the SFA.
       
          Where the shares are subscribed or purchased under Section 275 of the
          SFA by a relevant person which is a corporation (which is not an
          accredited investor (as defined in Section 4A of the SFA)) the sole
          business of which is to hold investments and the entire share capital
          of which is owned by one or more individuals, each of whom is an
          accredited investor, the securities (as defined in Section 239(1) of
          the SFA) of that corporation shall not be transferable for 6 months
          after that corporation has acquired the shares under Section 275 of
          the SFA except: (1) to an institutional investor under Section 274 of
          the SFA or to a relevant person (as defined in Section 275(2) of the
          SFA), (2) where such transfer arises from an offer in that
          corporation’s securities pursuant to Section 275(1A) of the SFA,
          (3) where no consideration is or will be given for the transfer,
          (4) where the transfer is by operation of law, (5) as specified in
          Section 276(7) of the SFA, or (6) as specified in Regulation 32 of the
          Securities and Futures (Offers of Investments) (Shares and Debentures)
          Regulations 2005 of Singapore, or Regulation 32.
       
          Where the shares are subscribed or purchased under Section 275 of the
          SFA by a relevant person which is a trust (where the trustee is not an
          accredited investor (as defined in Section 4A of the SFA)) whose sole
          purpose is to hold investments and each beneficiary of the trust is an
          accredited investor, the beneficiaries’ rights and interest (howsoever
          described) in that trust shall not be transferable for 6 months after
          that trust has acquired the shares under Section 275 of the SFA
          except: (1) to an institutional investor under Section 274 of the SFA
          or to a relevant person (as defined in Section 275(2) of the SFA), (2)
          where such transfer arises from an offer that is made on terms that
          such rights or interest are acquired at a consideration of not less
          than S$200,000 (or its equivalent in a foreign currency) for each
          transaction (whether such amount is to be paid for in cash or by
          exchange of securities or other assets), (3) where no consideration is
          or will be given for the transfer, (4) where the transfer is by
          operation of law, (5) as specified in Section 276(7) of the SFA, or
          (6) as specified in Regulation 32.
       
          Singapore SFA Product Classification—In connection with Section 309B
          of the SFA and the Securities and Futures (Capital Markets Products)
          Regulations 2018 (the “CMP Regulations 2018”), the Company has
          determined, and hereby notifies all relevant persons (as defined in
          the CMP Regulations 2018), that the shares are “prescribed capital
          markets products” (as defined in the CMP Regulations 2018) and
          Excluded Investment Products (as defined in MAS Notice SFA 04-N12:
          Notice on the Sale of Investment Products and MAS Notice FAA-N16:
          Notice on Recommendations on Investment Products).
       
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          LEGAL MATTERS
       
          The validity of the issuance of the shares of common stock being
          offered by this prospectus will be passed upon for us by Cooley LLP,
          New York, New York. Certain legal matters in connection with this
          offering will be passed upon for the underwriters by Latham & Watkins
          LLP.
       
          EXPERTS
       
          The consolidated financial statements at December 31, 2019 and 2020,
          and for each of the three years in the period ended December 31, 2020,
          appearing in this prospectus and registration statement, have been
          audited by Ernst & Young LLP, independent registered public accounting
          firm, as set forth in their report thereon appearing elsewhere herein,
          and are included in reliance upon such report given on the authority
          of such firm as experts in accounting and auditing.
       
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          WHERE YOU CAN FIND ADDITIONAL INFORMATION
       
          We have filed with the SEC a registration statement on Form S-1 under
          the Securities Act with respect to the shares of common stock offered
          by this prospectus. This prospectus, which constitutes a part of the
          registration statement, does not contain all the information set forth
          in the registration statement, some of which is contained in exhibits
          to the registration statement as permitted by the rules and
          regulations of the SEC. For further information with respect to us and
          our common stock, we refer you to the registration statement,
          including the exhibits filed as a part of the registration statement.
          Statements contained in this prospectus concerning the contents of any
          contract or any other document are not necessarily complete. If a
          contract or document has been filed as an exhibit to the registration
          statement, please see the copy of the contract or document that has
          been filed. Each statement in this prospectus relating to a contract
          or document filed as an exhibit is qualified in all respects by the
          filed exhibit. The SEC maintains an internet website that contains
          reports and other information about issuers, like us, that file
          electronically with the SEC. The address of that website is
          www.sec.gov.
       
          On the completion of this offering, we will be subject to the
          information reporting requirements of the Exchange Act, and we will
          file reports, proxy statements and other information with the SEC.
          These reports, proxy statements and other information will be
          available at www.sec.gov.
       
          We also maintain a website at www.digitalocean.com. Information
          contained in, or accessible through, our website is not a part of this
          prospectus, and the inclusion of our website address in this
          prospectus is only as an inactive textual reference.
       
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          DIGITALOCEAN HOLDINGS, INC.
       
          INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
       
          Page
       
          Report of Independent Registered Public Accounting Firm
       
          F-2
       
          Financial Statements:
       
          Consolidated Balance Sheets
       
          F-3
       
          Consolidated Statements of Operations
       
          F-4
       
          Consolidated Statements of Comprehensive Loss
       
          F-5
       
          Consolidated Statements of Convertible Preferred Stock and
          Stockholders’ Deficit
       
          F-6
       
          Consolidated Statements of Cash Flows
       
          F-7
       
          Notes to Consolidated Financial Statements
       
          F-8
       
          F-1
       
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          REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
       
          To the Stockholders and the Board of Directors of DigitalOcean
          Holdings, Inc. and its subsidiaries
       
          Opinion on the Financial Statements
       
          We have audited the accompanying consolidated balance sheets of
          DigitalOcean Holdings, Inc. (the Company) as of December 31, 2019 and
          2020, the consolidated statements of operations, comprehensive loss,
          convertible preferred stock and stockholders’ deficit and cash flows
          for each of the three years in the period ended December 31, 2020, and
          the related notes (collectively referred to as the “consolidated
          financial statements”). In our opinion, the consolidated financial
          statements present fairly, in all material respects, the financial
          position of the Company at December 31, 2019 and 2020, and the results
          of its operations and its cash flows for each of the three years in
          the period ended December 31, 2020, in conformity with U.S. generally
          accepted accounting principles.
       
          Basis for Opinion
       
          These financial statements are the responsibility of the Company’s
          management. Our responsibility is to express an opinion on the
          Company’s financial statements based on our audits. We are a public
          accounting firm registered with the Public Company Accounting
          Oversight Board (United States) (PCAOB) and are required to be
          independent with respect to the Company in accordance with the U.S.
          federal securities laws and the applicable rules and regulations of
          the Securities and Exchange Commission and the PCAOB.
       
          We conducted our audits in accordance with the standards of the PCAOB.
          Those standards require that we plan and perform the audit to obtain
          reasonable assurance about whether the financial statements are free
          of material misstatement, whether due to error or fraud. The Company
          is not required to have, nor were we engaged to perform, an audit of
          its internal control over financial reporting. As part of our audits
          we are required to obtain an understanding of internal control over
          financial reporting but not for the purpose of expressing an opinion
          on the effectiveness of the Company’s internal control over financial
          reporting. Accordingly, we express no such opinion.
       
          Our audits included performing procedures to assess the risks of
          material misstatement of the financial statements, whether due to
          error or fraud, and performing procedures that respond to those risks.
          Such procedures included examining, on a test basis, evidence
          regarding the amounts and disclosures in the financial statements. Our
          audits also included evaluating the accounting principles used and
          significant estimates made by management, as well as evaluating the
          overall presentation of the financial statements. We believe that our
          audits provide a reasonable basis for our opinion.
       
          /s/ Ernst & Young LLP
       
          We have served as the Company’s auditor since 2015.
       
          New York, New York
       
          February 25, 2021
       
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          Table of Contents
       
          DIGITALOCEAN HOLDINGS, INC.
       
          CONSOLIDATED BALANCE SHEETS
       
          (in thousands, except share amounts)
       
          December 31,
       
                  2019        
       
                  2020        
       
          Cash and cash equivalents
       
          $
       
          32,906
       
          $
       
          100,311
       
          Accounts receivable, less allowance for doubtful accounts of $5,300
          and $3,104, respectively
       
          20,747
       
          26,799
       
          Prepaid expenses and other current assets
       
          6,971
       
          20,843
       
          Total current assets
       
          60,624
       
          147,953
       
          Property and equipment, net
       
          205,916
       
          238,956
       
          Restricted cash
       
          2,980
       
          2,226
       
          Goodwill
       
          2,674
       
          2,674
       
          Intangible assets
       
          29,835
       
          34,649
       
          Deferred tax assets
       
          129
       
          82
       
          Other assets
       
          327
       
          3,712
       
          Total assets
       
          $
       
              302,485
       
          $
       
              430,252
       
          Accounts payable
       
          27,236
       
          12,433
       
          Accrued other expenses
       
          15,762
       
          27,025
       
          Deferred revenue
       
          4,306
       
          4,873
       
          Current portion of long-term debt
       
          15,157
       
          17,468
       
          Other current liabilities
       
          10,076
       
          22,986
       
          Total current liabilities
       
          72,537
       
          84,785
       
          Deferred tax liabilities
       
          177
       
          211
       
          Long-term debt
       
          175,903
       
          242,215
       
          Other long-term liabilities
       
          2,884
       
          2,061
       
          Total liabilities
       
          251,501
       
          329,272
       
          Commitments and Contingencies (Note 7)
       
          Convertible preferred stock
       
          123,264
       
          173,074
       
          Common stock ($0.000025 par value; 100,000,000 and 111,400,000 shares
          authorized, 41,095,849 and 45,299,339 shares issued and 39,127,621 and
          43,331,111 outstanding as of December 31, 2019 and December 31, 2020,
          respectively)
       
          1
       
          1
       
          Treasury stock, at cost (1,968,228 shares at December 31, 2019 and
          December 31, 2020, respectively)
       
          (4,598
       
          ) 
       
          (4,598
       
          ) 
       
          Additional paid-in capital
       
          55,896
       
          99,783
       
          Accumulated other comprehensive loss
       
          (112
       
          ) 
       
          (245
       
          ) 
       
          Accumulated deficit
       
          (123,467
       
          ) 
       
          (167,035
       
          ) 
       
          Total stockholders’ deficit
       
          (72,280
       
          ) 
       
          (72,094
       
          ) 
       
          Total liabilities, convertible preferred stock and stockholders’
          deficit
       
          $
       
          302,485
       
          $
       
          430,252
       
          See accompanying notes to consolidated financial statements
       
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          DIGITALOCEAN HOLDINGS, INC.
       
          CONSOLIDATED STATEMENTS OF OPERATIONS
       
          (in thousands, except per share amounts)
       
          Year Ended December 31,
       
                  2018        
       
                  2019    
       
                  2020        
       
          Revenue
       
          $
       
              203,136
       
          $
       
              254,823
       
          $
       
              318,380
       
          Cost of revenue
       
          97,042
       
          122,259
       
          145,532
       
          Gross profit
       
          106,094
       
          132,564
       
          172,848
       
          Operating expenses:
       
          Research and development
       
          44,934
       
          59,973
       
          74,970
       
          Sales and marketing
       
          29,445
       
          31,340
       
          33,472
       
          General and administrative
       
          59,009
       
          71,156
       
          80,197
       
          Total operating expenses
       
          133,388
       
          162,469
       
          188,639
       
          Loss from operations
       
          (27,294
       
          ) 
       
          (29,905
       
          ) 
       
          (15,791
       
          ) 
       
          Other (income) expense:
       
          Interest expense
       
          6,312
       
          9,356
       
          13,610
       
          Loss on extinguishment of debt
       
          550
       
          —
       
          259
       
          Other (income) expense, net
       
          622
       
          336
       
          12,997
       
          Other (income) expense
       
          7,484
       
          9,692
       
          26,866
       
          Loss before income taxes
       
          (34,778
       
          ) 
       
          (39,597
       
          ) 
       
          (42,657
       
          ) 
       
          Income tax expense
       
          1,221
       
          793
       
          911
       
          Net loss attributable to common stockholders
       
          $
       
          (35,999
       
          ) 
       
          $
       
          (40,390
       
          ) 
       
          $
       
          (43,568
       
          ) 
       
          Net loss per share attributable to common stockholders, basic and
          diluted
       
          $
       
          (1.06
       
          ) 
       
          $
       
          (1.06
       
          ) 
       
          $
       
          (1.05
       
          ) 
       
          Weighted-average shares used to compute net loss per share, basic and
          diluted
       
          33,971
       
          38,004
       
          41,658
       
          See accompanying notes to consolidated financial statements
       
          F-4
       
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          DIGITALOCEAN HOLDINGS, INC.
       
          CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
       
          (in thousands)
       
          Year Ended December 31,
       
                  2018        
       
                  2019        
       
                  2020        
       
          Net loss attributable to common stockholders
       
          $
       
              (35,999
       
          ) 
       
          $
       
              (40,390
       
          ) 
       
          $
       
              (43,568)
       
          Other comprehensive loss:
       
          Foreign currency translation adjustments, net of taxes
       
          (54
       
          ) 
       
          (59
       
          ) 
       
          (133
       
          ) 
       
          Comprehensive loss
       
          $
       
          (36,053
       
          ) 
       
          $
       
          (40,449
       
          ) 
       
          $
       
          (43,701
       
          ) 
       
          See accompanying notes to consolidated financial statements
       
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          DIGITALOCEAN HOLDINGS, INC.
       
          CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND
          STOCKHOLDERS’ DEFICIT
       
          (in thousands, except share amounts)
       
          Convertible
          Preferred Stock
       
          Common Stock
       
          Treasury Stock
       
          Additional
          Paid-In
          Capital
       
          Accumulated
          Other
          Comprehen-
          sive Loss
       
          Accumulated
          Deficit
       
          Total
       
          Shares
       
          Amount
       
          Shares
       
          Amount
       
          Shares
       
          Amount
       
          Balance at December 31, 2017
       
          40,750,324
       
          $
       
          123,264
       
          32,162,660
       
          $
       
                      1
       
          (1,968,228
       
          ) 
       
          $
       
          (4,598
       
          ) 
       
          $
       
          13,102
       
          $
       
                          1
       
          $
       
          (47,078
       
          ) 
       
          $
       
            (38,572
       
          ) 
       
          Issuance of common stock under stock option plan
       
          —
       
          —
       
          5,795,483
       
          —
       
          —
       
          —
       
          5,201
       
          —
       
          —
       
          5,201
       
          Stock-based compensation
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          12,560
       
          —
       
          —
       
          12,560
       
          Other comprehensive loss
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          (54
       
          ) 
       
          —
       
          (54
       
          ) 
       
          Net loss attributable to common stockholders
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          (35,999
       
          ) 
       
          (35,999
       
          ) 
       
          Balance at December 31, 2018
       
          40,750,324
       
          123,264
       
          37,958,143
       
          1
       
          (1,968,228
       
          ) 
       
          (4,598
       
          ) 
       
          30,863
       
          (53
       
          ) 
       
          (83,077
       
          ) 
       
          (56,864
       
          ) 
       
          Issuance of common stock under stock option plan
       
          —
       
          —
       
          3,137,706
       
          —
       
          —
       
          —
       
          5,819
       
          —
       
          —
       
          5,819
       
          Stock-based compensation
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          19,214
       
          —
       
          —
       
          19,214
       
          Other comprehensive loss
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          (59
       
          ) 
       
          —
       
          (59
       
          ) 
       
          Net loss attributable to common stockholders
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          (40,390
       
          ) 
       
          (40,390
       
          ) 
       
          Balance at December 31, 2019
       
          40,750,324
       
          123,264
       
          41,095,849
       
          1
       
          (1,968,228
       
          ) 
       
          (4,598
       
          ) 
       
          55,896
       
          (112
       
          ) 
       
          (123,467
       
          ) 
       
          (72,280
       
          ) 
       
          Issuance of common stock under stock option plan
       
          —
       
          —
       
          4,203,490
       
          —
       
          —
       
          —
       
          13,905
       
          —
       
          —
       
          13,905
       
          Issuance of convertible preferred stock
       
          4,721,905
       
          49,810
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          Stock-based compensation
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          29,982
       
          —
       
          —
       
          29,982
       
          Other comprehensive loss
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          (133
       
          ) 
       
          —
       
          (133
       
          ) 
       
          Net loss attributable to common stockholders
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          —
       
          (43,568
       
          ) 
       
          (43,568
       
          ) 
       
          Balance at December 31, 2020
       
          45,472,229
       
          $
       
          173,074
       
          45,299,339
       
          $
       
          1
       
          (1,968,228
       
          ) 
       
          $
       
              (4,598
       
          ) 
       
          $
       
             99,783
       
          $
       
          (245
       
          ) 
       
          $
       
          (167,035
       
          ) 
       
          $
       
          (72,094
       
          ) 
       
          See accompanying notes to consolidated financial statements
       
          F-6
       
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          Table of Contents
       
          DIGITALOCEAN HOLDINGS, INC.
       
          CONSOLIDATED STATEMENTS OF CASH FLOWS
       
          (in thousands)
       
          Year Ended December 31,
       
                2018      
       
                2019      
       
                2020      
       
          Operating activities
       
          Net loss attributable to common stockholders
       
          $
       
          (35,999
       
          ) 
       
          $
       
          (40,390
       
          ) 
       
          $
       
          (43,568
       
          ) 
       
          Adjustments to reconcile net loss to net cash provided by operating
          activities:
       
          Depreciation and amortization
       
              52,415
       
              63,081
       
              75,574
       
          Loss on impairment
       
          881
       
          546
       
          1,222
       
          Stock-based compensation
       
          12,167
       
          18,646
       
          29,456
       
          Non-cash interest expense
       
          1,200
       
          418
       
          1,107
       
          Loss on extinguishment of debt
       
          550
       
          —
       
          259
       
          Deferred income taxes
       
          (59
       
          ) 
       
          (8
       
          ) 
       
          71
       
          Revaluation of warrants
       
          478
       
          411
       
          12,825
       
          Bad debt expense
       
          8,180
       
          10,074
       
          11,089
       
          Other
       
          841
       
          427
       
          (316
       
          ) 
       
          Changes in operating assets and liabilities:
       
          Accounts receivable
       
          (10,790
       
          ) 
       
          (14,413
       
          ) 
       
          (17,141
       
          ) 
       
          Prepaid expenses and other current assets
       
          (573
       
          ) 
       
          (2,839
       
          ) 
       
          (13,328
       
          ) 
       
          Accounts payable and accrued expenses
       
          10,052
       
          3,954
       
          2,369
       
          Deferred revenue
       
          614
       
          795
       
          567
       
          Other assets and liabilities
       
          (2,003
       
          ) 
       
          (800
       
          ) 
       
          (2,071
       
          ) 
       
          Net cash provided by operating activities
       
          37,954
       
          39,902
       
          58,115
       
          Investing activities
       
          Capital expenditures—property and equipment
       
          (38,348
       
          ) 
       
          (53,504
       
          ) 
       
          (98,217
       
          ) 
       
          Capital expenditures—internal-use software development
       
          (13,392
       
          ) 
       
          (16,940
       
          ) 
       
          (12,328
       
          ) 
       
          Purchase of intangible assets
       
          (9,514
       
          ) 
       
          (14,055
       
          ) 
       
          (5,118
       
          ) 
       
          Business combinations, net of cash acquired
       
          —
       
          (2,928
       
          ) 
       
          —
       
          Proceeds from sale of equipment
       
          —
       
          44
       
          173
       
          Net cash used in investing activities
       
          (61,254
       
          ) 
       
          (87,383
       
          ) 
       
          (115,490
       
          ) 
       
          Financing activities
       
          Repayment of capital leases
       
          (248
       
          ) 
       
          (888
       
          ) 
       
          (3,801
       
          ) 
       
          Repayment of notes payable
       
          (35,959
       
          ) 
       
          (22,841
       
          ) 
       
          (14,080
       
          ) 
       
          Proceeds from the issuance of notes payable
       
          7,984
       
          11,495
       
          7,795
       
          Repayment of long-term debt
       
          (89,219
       
          ) 
       
          (3,281
       
          ) 
       
          (73,500
       
          ) 
       
          Proceeds from the issuance of long-term debt
       
          75,000
       
          —
       
          170,000
       
          Repayment of borrowings under revolving credit facility
       
          (17,800
       
          ) 
       
          —
       
          (84,500
       
          ) 
       
          Proceeds from borrowings under revolving credit facility
       
          42,800
       
          59,500
       
          63,200
       
          Payment of debt issuance costs
       
          (2,007
       
          ) 
       
          —
       
          (3,275
       
          ) 
       
          Payment of deferred offering costs
       
          —
       
          —
       
          (1,403
       
          ) 
       
          Proceeds from the issuance of common stock under stock plan
       
          5,201
       
          5,819
       
          13,905
       
          Proceeds from the issuance of convertible preferred stock, net of
          issuance costs
       
          —
       
          —
       
          49,810
       
          Repayment of seller’s note
       
          —
       
          —
       
          (125
       
          ) 
       
          Net cash (used in) provided by financing activities
       
          (14,248
       
          ) 
       
          49,804
       
          124,026
       
          (Decrease) increase in cash, cash equivalents and restricted cash
       
          (37,548
       
          ) 
       
          2,323
       
          66,651
       
          Cash, cash equivalents and restricted cash—beginning of period
       
          71,111
       
          33,563
       
          35,886
       
          Cash, cash equivalents and restricted cash—end of period
       
          $
       
          33,563
       
          $
       
          35,886
       
          $
       
          102,537
       
          Supplemental disclosures of cash flow information:
       
          Cash paid for interest
       
          $
       
          4,622
       
          $
       
          8,829
       
          $
       
          12,398
       
          Cash paid for taxes (net of refunds)
       
          445
       
          306
       
          605
       
          Non-cash investing and financing activities:
       
          Capitalized stock-based compensation
       
          $
       
          392
       
          $
       
          567
       
          $
       
          526
       
          Property and equipment received but not yet paid
       
          11,932
       
          23,622
       
          17,928
       
          Seller financed equipment purchases
       
          49,435
       
          10,722
       
          3,927
       
          Acquisition of property and equipment from capital leases
       
          4,904
       
          —
       
          —
       
          See accompanying notes to consolidated financial statements
       
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          Table of Contents
       
          DIGITALOCEAN HOLDINGS, INC.
       
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
       
          (in thousands, except share and per share amounts)
       
          Note 1. Nature of the Business and Organization
       
          DigitalOcean Holdings, Inc. and its subsidiaries (collectively, the
          “Company”, “we”, “our”, “us”) is a leading cloud computing platform
          offering on-demand infrastructure and platform tools for developers,
          start-ups and small-to-medium size businesses. The Company was founded
          with the guiding principle that the transformative benefits of the
          cloud should be easy to leverage, broadly accessible, reliable and
          affordable. The Company’s platform simplifies cloud computing,
          enabling its customers to rapidly accelerate innovation and increase
          their productivity and agility. The Company offers mission-critical
          infrastructure solutions across compute, storage and networking, and
          also enables developers to extend the native capabilities of the
          Company’s cloud with fully managed application, container and database
          offerings.
       
          The Company has adopted a holding company structure and the primary
          operations are performed globally through our wholly-owned operating
          subsidiaries.
       
          Note 2. Summary of Significant Accounting Policies
       
          Basis of Presentation and Principles of Consolidation
       
          The accompanying consolidated financial statements have been prepared
          in accordance with accounting principles generally accepted in the
          United States of America (“U.S. GAAP”) and include accounts of the
          Company and all wholly-owned subsidiaries. All intercompany accounts
          and transactions have been eliminated in consolidation.
       
          Use of Estimates
       
          The preparation of these consolidated financial statements in
          conformity with U.S. GAAP requires management to make, on an ongoing
          basis, estimates, judgments and assumptions that affect the amounts
          reported and disclosed in the consolidated financial statements and
          accompanying notes. Actual results could differ from those estimates.
          Such estimates include, but are not limited to, those related to
          revenue recognition, accounts receivable and related reserves, useful
          lives and realizability of long lived assets, capitalized internal-use
          software development costs, assumptions used in the valuation of
          warrants, accounting for stock-based compensation, and valuation
          allowances against deferred tax assets. Management bases its estimates
          on historical experience and on various other assumptions which
          management believes to be reasonable, the results of which form the
          basis for making judgments about the carrying values of assets and
          liabilities.
       
          Emerging Growth Company
       
          The Company is an “emerging growth company,” as defined in
          Section 2(a) of the Securities Act of 1933 (as amended, the
          “Securities Act”), as modified by the Jumpstart Our Business Startups
          Act of 2012 (the “JOBS Act”), and it may take advantage of certain
          exemptions from various reporting requirements that are applicable to
          other public companies that are not emerging growth companies
          including, but not limited to, not being required to comply with the
          auditor attestation requirements of Section 404 of the Sarbanes-Oxley
          Act, reduced disclosure obligations regarding executive compensation
          in its periodic reports and proxy statements, and exemptions from the
          requirements of holding a nonbinding advisory vote on executive
          compensation and shareholder approval of any golden parachute payments
          not previously approved.
       
          Further, Section 102(b)(1) of the JOBS Act exempts emerging growth
          companies from being required to comply with new or revised financial
          accounting standards until private companies (that is, those that have
          not
       
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          Table of Contents
       
          had a Securities Act registration statement declared effective or do
          not have a class of securities registered under the Securities
          Exchange Act of 1934, as amended (“Exchange Act”)) are required to
          comply with the new or revised financial accounting standards. The
          JOBS Act provides that a company can elect to opt out of the extended
          transition period and comply with the requirements that apply to
          non-emerging growth companies but any such election to opt out is
          irrevocable. The Company has elected not to opt out of such extended
          transition period which means that when a standard is issued or
          revised and it has different application dates for public or private
          companies, the Company, as an emerging growth company, can adopt the
          new or revised standard at the time private companies adopt the new or
          revised standard. This may make comparison of the Company’s financial
          statements with another public company which is neither an emerging
          growth company nor an emerging growth company which has opted out of
          using the extended transition period difficult because of the
          potential differences in accounting standards used.
       
          Cash and Cash Equivalents
       
          Cash and cash equivalents consist of highly liquid investments in
          money market funds, with an original maturity from the date of
          purchase of three months or less.
       
          Foreign Currency
       
          The functional currency of the Company’s international subsidiaries is
          the local currency. The Company reflects net foreign exchange
          transaction gains and losses resulting from the conversion of the
          transaction currency to functional currency as a component of foreign
          currency exchange losses in Other (income) expense, net on the
          Consolidated Statements of Operations.
       
          Restricted Cash
       
          Restricted cash includes deposits in financial institutions related to
          letters of credit used to secure lease agreements. The following table
          reconciles cash, cash equivalents and restricted cash per the
          Consolidated Statements of Cash Flows:
       
          December 31,
       
                  2019        
       
                  2020        
       
          Cash and cash equivalents
       
          $
       
                32,906
       
          $
       
                100,311
       
          Restricted cash
       
          2,980
       
          2,226
       
          Total cash, cash equivalents and restricted cash
       
          $
       
          35,886
       
          $
       
          102,537
       
          Accounts Receivable and Allowance for Doubtful Accounts
       
          Accounts receivable primarily represents revenue recognized that was
          not invoiced at the balance sheet date and is primarily billed and
          collected in the following month. Trade accounts receivable are
          carried at the original invoiced amount less an estimated allowance
          for doubtful accounts based on the probability of future collection.
          Management determines the adequacy of the allowance based on
          historical loss patterns, the number of days that customer invoices
          are past due and an evaluation of the potential risk of loss
          associated with specific accounts. When management becomes aware of
          circumstances that may further decrease the likelihood of collection,
          it records a specific allowance against amounts due, which reduces the
          receivable to the amount that management reasonably believes will be
          collected. The Company records changes in the estimate to the
          allowance for doubtful accounts through bad debt expense and reverses
          the allowance after the potential for recovery is considered remote.
       
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          Table of Contents
       
          The following table presents the changes in our allowance for doubtful
          accounts for the periods presented:
       
          December 31,
       
                  2019        
       
                  2020        
       
          Balance, beginning of period
       
          $
       
          4,832
       
          $
       
          5,300
       
          Bad debt expense, net of recoveries
       
          10,074
       
          11,089
       
          Write-offs
       
          (9,606
       
          ) 
       
          (13,285
       
          ) 
       
          Balance, end of period
       
          $
       
                  5,300
       
          $
       
                  3,104
       
          Fair Value of Financial Instruments
       
          The Company defines fair value as the price that would be received
          from selling an asset or paid to transfer a liability in an orderly
          transaction between market participants at the measurement date. When
          determining the fair value measurements for assets and liabilities
          that are required to be recorded at fair value, the Company considers
          the principal or most advantageous market in which to transact and the
          market-based risk. The Company applies fair value accounting for all
          financial assets and liabilities that are recognized or disclosed at
          fair value in the financial statements on a recurring basis. The
          carrying amounts reported in the consolidated financial statements
          approximate the fair value for cash and cash equivalents, restricted
          cash, accounts receivable, accounts payable, and accrued expenses due
          to their short-term nature. The carrying amount of the Company’s debt
          approximates fair value as the interest rate is reset frequently based
          on current market rates as well as the short-term maturity of those
          instruments and is considered Level 2.
       
          Property and Equipment
       
          Property and equipment is stated at cost, net of accumulated
          depreciation. Depreciation on property and equipment is calculated
          using the straight-line method over the estimated useful lives of the
          assets and is included in depreciation and amortization expense in the
          Consolidated Statements of Operations. The estimated useful lives of
          property and equipment are as follows:
       
          Property and Equipment Category
       
          Useful Life
       
          Computers and equipment
       
          5 years
       
          Furniture and fixtures
       
          5 years
       
          Leasehold improvements
       
          Lesser of lease term or remaining useful life
       
          Internal-use software
       
          3 years
       
          The Company periodically reviews the estimated useful lives of
          property and equipment.
       
          Capitalization of Internal-Use Software Development Costs
       
          Capitalization of costs incurred in connection with software developed
          for internal-use commences when both the preliminary project stage is
          completed and management has authorized further funding for the
          project, based on a determination that it is probable the project will
          be completed and used to perform the function intended. Capitalized
          costs include external consulting fees, payroll and payroll-related
          costs, and stock-based compensation for employees on development teams
          who are directly associated with, and who devote time to, internal-use
          software projects during the application development stage.
          Capitalization of such costs ceases no later than the point at which
          the project is substantially complete and ready for its intended use.
          Costs incurred during the planning, training and post-implementation
          stages of the software development lifecycle are expensed as incurred
          and have been included in Research and development expense on the
          Consolidated Statements of Operations.
       
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          Capital Leases
       
          The Company leases certain property and equipment related to our data
          centers under capital lease agreements. The assets held under capital
          leases and related obligations are recorded at the lesser of the
          present value of aggregate future minimum lease payments, including
          estimated bargain purchase options, or the fair value of the assets
          held under the capital leases. Such assets are depreciated over the
          shorter of the term of the underlying lease or the estimated useful
          life of the assets. For assets for which the lease agreement includes
          a bargain purchase option at the completion of the lease, the asset is
          depreciated over its estimated useful life. Assets purchased at the
          end of the lease are depreciated over their remaining useful life. As
          of December 31, 2020, the Company paid the remaining obligations on
          all outstanding master lease agreements and purchased the equipment.
       
          Impairment of Long-Lived Assets
       
          Long-lived assets, including property and equipment and intangible
          assets with definite lives, are reviewed for impairment whenever
          events or changes in circumstances indicate that the carrying amount
          of an asset may not be recoverable. Recoverability of assets to be
          held and used is measured by a comparison of the carrying amount of an
          asset to future undiscounted cash flows expected to be generated by
          the asset. Impairment losses are then measured by comparing the fair
          value of assets to their carrying amounts.
       
          Business Combinations
       
          The Company recognizes assets acquired, liabilities assumed and any
          contingent consideration related to business combinations based on
          estimates of their respective fair values on the date of acquisition.
          The purchase price is allocated to the identifiable net assets
          acquired, including intangible assets and liabilities assumed, based
          on estimated fair values at the date of acquisition. The excess of the
          purchase price over the amount allocated to the identifiable assets
          and liabilities, if any, is recorded as goodwill. Unanticipated events
          and circumstances may occur which may affect the accuracy or validity
          of such assumptions, estimates or actual results. All subsequent
          changes to the estimated fair values of the acquired assets and
          liabilities assumed that occur within the measurement period and are
          based on facts and circumstances that existed at the acquisition date
          are recognized as an adjustment to goodwill.
       
          Determining the fair value of assets acquired and liabilities assumed
          requires significant judgment, including the selection of valuation
          methodologies, estimates of future revenue and cash flows and discount
          rates in determining the fair value of intangible assets acquired and
          liabilities assumed. The assets purchased and liabilities assumed have
          been reflected on the Company’s Consolidated Balance Sheets, and the
          results are included on the Consolidated Statements of Operations and
          Consolidated Statements of Cash Flows from the date of acquisition.
       
          Acquisition-related transaction costs, including legal and accounting
          fees and other external costs directly related to the acquisition, are
          recognized separately from the acquisition and expensed as incurred in
          General and administrative on the Consolidated Statements of
          Operations.
       
          On April 4, 2019, the Company acquired 100% of the outstanding equity
          of Nanobox, Inc., a Delaware corporation (“Nanobox”), a deployment and
          management platform provider for cloud infrastructure. The final
          purchase price for Nanobox was $3,544 and the acquisition has been
          accounted for as a business combination.
       
          The Company allocates the purchase price to the identifiable net
          assets acquired, including intangible assets and liabilities assumed,
          based on the estimated fair values at the date of acquisition. The
          excess of the purchase price over the amount allocated to the
          identifiable assets and liabilities was recorded as goodwill. The
          Company determined the estimated fair values of intangible assets
          acquired using estimates of future discounted cash flows to be
          generated by the business based on projections of future revenue and
          operating expenses over the estimated duration of those cash flows on
          the projected useful lives of the assets acquired. The discount rate
          was determined based on specific business risk, cost of capital and
          other factors.
       
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          The allocation of the purchase price to the fair values of the assets
          acquired and liabilities assumed at the date of the acquisition was as
          follows:
       
          Cash
       
          $
       
          12
       
          Prepaid expenses and other assets
       
          4
       
          Intangible assets
       
          910
       
          Total identifiable assets acquired
       
          926
       
          Accounts payable and accrued liabilities
       
          56
       
          Total liabilities assumed
       
          56
       
          Net identifiable assets acquired
       
          870
       
          Goodwill
       
          2,674
       
          Net assets acquired
       
          $
       
              3,544
       
          The relief from royalty method, a variation of the income method, was
          used to determine the estimated fair market value of the technology in
          the amount of $910.
       
          For federal income tax purposes, the Nanobox acquisition was treated
          as a stock acquisition. The goodwill and the intangible assets
          recognized are not deductible for income tax purposes.
       
          Goodwill and Indefinite-Lived Intangible Assets
       
          Goodwill is an asset representing the future economic benefit arising
          from other assets acquired in a business combination which are not
          individually identified and separately recognized. The Company does
          not amortize goodwill. Goodwill has resulted from the acquisition of
          Nanobox on April 4, 2019 as discussed above under Business
          Combinations. Goodwill is reviewed for impairment on an annual basis
          as of October 1st of each year, or more frequently if a triggering
          event occurs. Goodwill was $2,674 at December 31, 2019 and 2020 and
          reflects the excess of cost over fair market value of the identifiable
          assets of the company acquired.
       
          Indefinite-lived intangible assets consist of Internet Protocol (“IP”)
          addresses needed for customers to host their server online. The
          Company evaluates these indefinite-lived intangible assets for
          impairment on an annual basis as of October 1st of each year and
          whenever events or changes in circumstances indicate that an
          impairment may exist. Recoverability of assets held and used is
          measured by comparison of the carrying amount of an asset or an asset
          group to estimated undiscounted future net cash flows expected to be
          generated by the asset or asset group. If the carrying amount of an
          asset exceeds these estimated future cash flows, an impairment charge
          is recognized by the amount by which the carrying amount of the assets
          exceeds the fair value of the asset or asset group, based on
          discounted cash flows. No impairment charges for goodwill and
          indefinite-lived intangible assets have been recorded during the years
          ended December 31, 2019 and 2020. Intangible assets with indefinite
          lives were $29,153 and $34,270 as of December 31, 2019 and 2020,
          respectively, and are included as Intangible assets on the
          Consolidated Balance Sheets.
       
          Intangible Assets
       
          Intangible assets with definite lives consist of acquired developed
          technology. Intangible assets with definite lives are stated at cost
          less accumulated amortization and are amortized on a basis consistent
          with the timing and pattern of expected cash flows used to value the
          intangible, generally on a straight-line basis over the useful life of
          3 years. Intangible assets with definite lives were $682 and $379 as
          of December 31, 2019 and 2020, respectively, and are included as
          Intangible assets on the Consolidated Balance Sheets.
       
          Redeemable Convertible Preferred Stock Warrant Liability
       
          The Company accounts for freestanding warrants to purchase shares of
          their convertible preferred stock in Other current liabilities on the
          Consolidated Balance Sheets. The redeemable convertible preferred
          stock
       
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          Table of Contents
       
          warrants (the “warrants”) are recorded as a liability as the
          underlying shares of convertible preferred stock are contingently
          redeemable, which is outside of the control of the Company. The
          warrants are recorded at fair value upon issuance and are subject to
          remeasurement to fair value at each balance sheet date, with any
          change in fair value recognized as a separate line item on the
          Consolidated Statements of Operations.
       
          The Company estimated the fair value of these warrants using the
          Black-Scholes option-pricing model and recognized remeasurement losses
          of $411 and $12,825 for the years ended December 31, 2019 and 2020,
          respectively. The Company will continue to adjust the redeemable
          convertible preferred stock warrant liability to its estimated fair
          value at each reporting period until the earlier of the (i) exercise
          of the warrants, (ii) expiration of the warrants or (iii) other
          triggering events as applicable to the terms of the warrant
          agreements.
       
          Revenue Recognition
       
          The Company adopted FASB Accounting Standards Codification (“ASC”)
          Topic 606, Revenue from Contracts with Customers (“ASC 606” or “the
          standard”) and ASC 340-40, Contract Costs, effective January 1, 2019,
          using the modified retrospective method of adoption. The standard was
          applied only to contracts that are not completed at the date of
          initial application. The adoption of ASC 606 did not result in any
          significant changes to the amount and timing of revenue recognition in
          prior, current or future periods. Therefore, there was no cumulative
          adjustment as a result of adoption. The reported results for fiscal
          year 2019 and later reflect the application of ASC 606, while the
          reported results for fiscal years prior to adoption are not adjusted
          and continue to be reported under ASC 605.
       
          The Company accounts for revenue using the following steps:
       
          1.
       
          Identify the contract with a customer
       
          2.
       
          Identify the performance obligations in the contract
       
          3.
       
          Determine the transaction price
       
          4.
       
          Allocate the transaction price to performance obligations in the
          contract
       
          5.
       
          Recognize revenue when or as we satisfy a performance obligation
       
          The Company provides cloud computing services, including but not
          limited to compute, storage, and networking, to its customers. The
          Company recognizes revenue based on the customer utilization of these
          resources. Customer contracts are typically month-to-month and do not
          include any minimum guaranteed quantities or fees. Fees are billed
          monthly, and payment is typically due upon invoicing. Revenue is
          recognized net of allowances for credits and any taxes collected from
          customers.
       
          The Company’s global cloud platform is supported by various third
          parties. The Company considered the principal versus agent guidance in
          ASC 606 and concluded that it is the principal for all services
          provided to its customers.
       
          The Company may offer sales incentives in the form of promotional and
          referral credits, and grant credits to encourage customers to use the
          Company’s services. These types of promotional and referral credits
          typically expire in two months or less if not used. For credits earned
          with a purchase, they are recorded as contract liabilities when earned
          and recognized at the earlier of redemption or expiration. The
          majority of credits are redeemed in the month they are earned.
       
          Timing of revenue recognition may differ from the timing of invoicing
          to the Company’s customers. The Company records a receivable when
          revenue is recognized prior to invoicing. Any payments received in
          advance
       
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          of billing are a contract liability, which is recorded as Deferred
          revenue within Total current liabilities on the Consolidated Balance
          Sheets. Revenue recognized during the years ended December 31, 2019
          and 2020, which was included in the Deferred revenue balances at the
          beginning of each respective period, was $1,936 and $2,440,
          respectively.
       
          Cost of Revenue
       
          Cost of revenue consists primarily of fees related to operating in
          third-party co-location facilities, personnel expenses for those
          directly supporting our data centers and non-personnel costs,
          including amortization of capitalized internal-use software
          development costs and depreciation of our data center equipment.
          Third-party co-location facility costs include data center rental
          fees, power costs, maintenance fees, and network and bandwidth
          expenses. Personnel expenses include salaries, bonuses, benefits and
          stock-based compensation.
       
          Research and Development Expenses
       
          Research and development expenses consist primarily of personnel costs
          including salaries, bonuses, benefits and stock-based compensation.
          Research and development expenses also include amortization of
          capitalized internal-use software development costs for research and
          development activities, which are amortized over three years, and
          professional services, as well as costs related to our efforts to add
          new features to our existing offerings, develop new offerings, and
          ensure the security, performance and reliability of our global cloud
          platform.
       
          Sales and Marketing Expenses
       
          Sales and marketing expenses consist primarily of personnel costs of
          our sales, marketing and customer support employees, including
          salaries, bonuses, benefits and stock-based compensation. Sales and
          marketing expenses also include costs for marketing programs,
          advertising and professional service fees.
       
          General and Administrative Expenses
       
          General and administrative expenses consist primarily of personnel
          costs of our human resources, legal, finance and other administrative
          functions, including salaries, bonuses, benefits and stock-based
          compensation. General and administrative expenses also include bad
          debt expense, software, payment processing fees, depreciation and
          amortization expenses, rent and facilities costs, and other
          administrative costs.
       
          Advertising and Other Promotional Costs
       
          Advertising and other promotional costs are expensed as incurred and
          are included in Sales and marketing on the Consolidated Statements of
          Operations. Non-direct response advertising expenses were $12,605,
          $8,426 and $6,331 for the years ended December 31, 2018, 2019 and
          2020, respectively.
       
          Income Taxes
       
          The Company accounts for income taxes pursuant to the asset and
          liability method. Deferred income tax assets and liabilities are
          recognized for the future tax consequences attributable to differences
          between the financial statement and tax basis of assets and
          liabilities that will result in taxable or deductible amounts in the
          future. Such deferred income tax assets and liabilities are based on
          enacted tax laws and rates applicable to periods in which the
          differences are expected to affect taxable income. A valuation
          allowance is established when necessary to reduce deferred tax assets
          to the amounts expected to be realized. Federal, state and foreign
          income taxes are provided based on statutory rates.
       
          On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Tax
          Act”) was signed into law. The Tax Act requires an entity to make an
          accounting policy election of either (1) treating taxes due on future
          U.S.
       
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          inclusions in taxable income related to Global Intangible Low Taxed
          Income (“GILTI”) as a current period expense when incurred (the
          “period cost method”) or (2) factoring such amounts into an entity’s
          measurement of its deferred taxes (the “deferred method”). The Company
          recorded tax expense related to GILTI in the effective tax rate for
          the years ended December 31, 2018, 2019 and 2020 and has elected to
          treat taxes due on future U.S. inclusions in taxable income related to
          GILTI as a current period expense when incurred using the period cost
          method.
       
          The Company accounts for uncertainty in income taxes using a
          recognition threshold and a measurement attribute for the financial
          statement recognition and measurement of tax positions taken or
          expected to be taken in a tax return. For benefits to be recognized, a
          tax position must be more likely than not to be sustained upon
          examination by the taxing authorities. The amount recognized is
          measured as the largest amount of benefit that has a greater than 50%
          likelihood of being realized upon ultimate audit settlement.
       
          The Company recognizes interest and penalties, if any, associated with
          income tax matters as part of income tax expense on the Consolidated
          Statements of Operations and includes accrued interest and penalties
          with the related income tax liability in other current liabilities on
          the Consolidated Balance Sheets.
       
          Segment Information
       
          The Company’s chief operating decision maker, the chief executive
          officer, reviews discrete financial information presented on a
          consolidated basis for purposes of regularly making operating
          decisions, allocation of resources and assessing financial
          performance. Accordingly, the Company has one operating and reporting
          segment.
       
          Geographical Information
       
          Revenue, as determined based on the billing address of the Company’s
          customers, was as follows:
       
          December 31,
       
                  2018        
       
                  2019        
       
                  2020        
       
          North America
       
          40
       
          % 
       
          38
       
          % 
       
          38
       
          % 
       
          Europe
       
          30
       
          % 
       
          30
       
          % 
       
          30
       
          % 
       
          Asia
       
          22
       
          % 
       
          24
       
          % 
       
          22
       
          % 
       
          Other
       
          8
       
          % 
       
          8
       
          % 
       
          10
       
          % 
       
          Total
       
          100
       
          % 
       
          100
       
          % 
       
          100
       
          % 
       
          For the years ended December 31, 2018, 2019 and 2020, revenue
          attributable to customers in the United States was 35%, 32% and 31%,
          respectively, as determined based on the billing address of the
          Company’s customers.
       
          No country outside of the United States had revenue greater than 10%
          of total consolidated revenue in any period presented.
       
          Property and equipment located in the United States was approximately
          50% and 48% for the years ended December 31, 2019 and 2020,
          respectively, with the remainder of net assets residing in
          international locations, primarily the Netherlands, Singapore and
          Germany.
       
          Concentration of Credit Risk
       
          The amounts reflected in the Consolidated Balance Sheets for cash and
          cash equivalents, restricted cash and trade accounts receivable are
          exposed to concentrations of credit risk. Although the Company
          maintains cash and
       
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          cash equivalents with multiple financial institutions, the deposits,
          at times, may exceed federally insured limits. The Company believes
          that the financial institutions that hold its cash and cash
          equivalents are financially sound and, accordingly, minimal credit
          risk exists with respect to these balances.
       
          The Company’s customer base consists of a significant number of
          geographically dispersed customers. No customer represented 10% or
          more of accounts receivable, net as of December 31, 2019 and 2020.
          Additionally, no customer accounted for 10% of more of total revenue
          during the years ended December 31, 2018, 2019 and 2020.
       
          Stock-Based Compensation
       
          Stock Options
       
          Compensation expense related to stock-based transactions, including
          employee, consultant and non-employee director stock option awards, is
          measured and recognized, net of estimated forfeitures, in the
          Consolidated Statements of Operations based on fair value. The fair
          value of each option award is estimated on the grant date using the
          Black Scholes option-pricing model. Expense is recognized on a
          straight-line basis over the requisite service period. The
          option-pricing model requires the input of highly subjective
          assumptions, including the fair value of the underlying common stock,
          the expected term of the option, the expected volatility of the price
          of the Company’s common stock, risk-free interest rates and the
          expected dividend yield of the Company’s common stock. The assumptions
          used in the option-pricing model represent management’s best
          estimates.
       
          Expected volatility is a measure of the amount by which the stock
          price is expected to fluctuate. Since the Company does not have
          sufficient trading history of its common stock, the Company estimates
          the expected volatility of its stock options at the grant date by
          taking the average historical volatility of a group of comparable
          publicly traded companies over a period equal to the expected life of
          the options.
       
          The Company determines the expected term based on the average period
          the stock options are expected to remain outstanding using the
          simplified method, generally calculated as the midpoint of the stock
          options’ vesting term and contractual expiration period, as the
          Company does not have sufficient historical information to develop
          reasonable expectations about future exercise patterns and
          post-vesting employment termination behavior.
       
          The Company uses the U.S. Treasury yield for our risk-free interest
          rate that corresponds with the expected term. The Company utilizes a
          dividend yield of zero, as the Company does not currently issue
          dividends, nor does the Company expect to do so in the future.
       
          The Company measures stock options granted to employees and directors
          based on their fair value on the date of the grant and recognize
          compensation expense of those awards, net of estimated forfeitures,
          over the requisite service period, which is generally the vesting
          period of the respective award. The Company applies the straight-line
          method of expense recognition to all awards with only service-based
          vesting conditions.
       
          Stock-based compensation for non-employee stock options is calculated
          using the Black-Scholes option pricing model and is recorded as the
          options vest.
       
          Restricted Stock Units
       
          The Company issues restricted stock units (“RSUs”) as incentive awards
          to its employees. RSUs are payable in shares of the Company’s common
          stock as the periodic vesting requirements are satisfied over a four
          year period. The value of RSUs is determined using the intrinsic value
          method and is based on the number of shares granted and the valuation
          of the Company’s common stock on the date of grant.
       
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          Determination of Fair Value of Common Stock
       
          Since there has been no public market for the Company’s common stock,
          the estimated fair value of its common stock has been determined by
          the board of directors as of the date of each option grant, with input
          from management, considering the Company’s most recently available
          third-party valuations of common stock and an assessment of additional
          objective and subjective factors. These third-party valuations were
          performed in accordance with the guidance outlined in the American
          Institute of Certified Public Accountants’ Accounting and Valuation
          Guide, Valuation of Privately Held Company Equity Securities Issued as
          Compensation.
       
          In valuing the Company’s common stock, the equity value of the
          business was determined using various valuation methods including
          combinations of income and market approaches with input from
          management. The income approach estimates value based on the
          expectation of future cash flows that a company will generate. These
          future cash flows are discounted to their present values using a
          discount rate derived from an analysis of the cost of capital of
          comparable publicly traded companies in the Company’s industry or
          similar business operations as of each valuation date and is adjusted
          to reflect the risks inherent in our cash flows.
       
          For each valuation, the equity value determined by the income and
          market approaches was then allocated to the common stock using either
          the option pricing method (“OPM”) or a combination of the OPM and the
          probability-weighted expected return method (“PWERM”), which is
          referred to as a Hybrid Method. The OPM allocates the overall Company
          value to the various share classes based on differences in liquidation
          preferences, participation rights, dividend policy and conversion
          rights, using a series of call options. The call right is valued using
          a Black-Scholes option pricing model. The PWERM employs additional
          information not used in the OPM, including various market approach
          calculations depending upon the likelihood of various discrete future
          liquidity scenarios, such as an initial public offering (“IPO”) or
          sale of the Company, as well as the probability of remaining a private
          company.
       
          Net Loss per Share Attributable to Common Stockholders
       
          Basic and diluted net loss per share attributable to common
          stockholders is presented in conformity with the two-class method
          required for participating securities. Prior to a conversion of the
          preferred stock, holders of Series Seed, Series A-1, Series B and
          Series C convertible preferred stock are each entitled to receive
          non-cumulative dividends payable prior and in preference to any
          dividends on any shares of the Company’s common stock. Under the
          two-class method, net income is attributed to common stockholders and
          participating securities based on their participation rights. The
          holders of the convertible preferred stock do not have a contractual
          obligation to share in the losses of the Company. As such, the
          Company’s net losses for the years ended December 31, 2018, 2019 and
          2020 were not allocated to these participating securities.
       
          Basic and diluted net loss per common share is presented in conformity
          with the treasury stock method required for stock options and
          warrants.
       
          As the Company has reported losses for all periods presented, all
          potentially dilutive securities are antidilutive and accordingly,
          basic net loss per share equals diluted net loss per share.
       
          Deferred Offering Costs
       
          Deferred offering costs, which consist of direct incremental legal,
          accounting, and consulting fees relating to the IPO, will be
          capitalized. The deferred offering costs will be offset against IPO
          proceeds upon the consummation of the IPO. In the event the planned
          IPO is terminated, the deferred offering costs will be expensed. There
          were no deferred offering costs capitalized as of December 31, 2018 or
          2019. As of December 31, 2020, there was $1,403 of deferred offering
          costs recorded.
       
          F-17
       
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          Recent Accounting Pronouncements—Pending Adoption
       
          The following effective dates represent the requirements for private
          companies which the Company has elected as an emerging growth company.
       
          In February 2016, the Financial Accounting Standards Board (“FASB”)
          issued Accounting Standard Update (“ASU”) 2016-02, Leases (Topic 842),
          and additional changes, modifications, clarifications or
          interpretations related to this guidance thereafter (“ASU 2016-02”).
          ASU 2016-02 requires a reporting entity to recognize right-of-use
          assets and lease liabilities on the balance sheet for operating leases
          to increase transparency and comparability. ASU 2016-02 is effective
          for fiscal years beginning after December 15, 2021 and interim periods
          within fiscal years beginning after December 15, 2022, with early
          adoption permitted. The Company will record a right of use asset and
          liability, and is currently evaluating the impact of adoption on the
          consolidated financial statements.
       
          In June 2016, the FASB issued ASU 2016-13, with subsequent amendments,
          Financial Instruments—Credit Losses (Topic 326): Measurement of Credit
          Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 requires
          immediate recognition of management’s estimates of current expected
          credit losses. ASU 2016-13 is effective for annual reporting periods
          beginning after December 15, 2022 and interim periods within annual
          periods beginning after December 15, 2023, with early adoption
          permitted. The Company is currently evaluating the impact of adoption
          on the consolidated financial statements.
       
          In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic
          740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”). ASU
          2019-12 eliminates certain exceptions in FASB Topic 740: Income Taxes
          (“ASC 740”) related to the approach for intra-period tax allocation,
          the methodology for calculating income taxes in an interim period and
          the recognition of deferred tax liabilities for outside basis
          differences. It also clarifies and simplifies other aspects of the
          accounting for income taxes. ASU 2019-12 is effective for annual
          reporting periods beginning after December 15, 2021 and interim
          periods within fiscal years beginning after December 15, 2022, with
          early adoption permitted. The Company is currently evaluating the
          impact of adoption on the consolidated financial statements.
       
          In August 2020, the FASB issued ASU 2020-06, Debt with Conversion and
          Other Options and Derivatives and Hedging - Contracts in Entity’s Own
          Equity (“ASU 2020-06”). ASU 2020-06 simplifies the accounting for
          convertible debt instruments by reducing the number of accounting
          models and the number of embedded features that could be recognized
          separately from the host contract. Consequently, more convertible debt
          instruments will be accounted for as a single liability measured at
          its amortized cost, as long as no other features require bifurcation
          and recognition as derivatives. ASU 2020-06 also requires use of the
          if-converted method in the diluted earnings per share calculation for
          convertible instruments. ASU 2020-06 is effective for fiscal years
          beginning after December 15, 2023 and interim periods within those
          fiscal years, with early adoption permitted. The Company is currently
          evaluating the impact of adoption on the consolidated financial
          statements.
       
          Recent Accounting Pronouncements—Adopted
       
          In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and
          Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU
          2017-04”). ASU 2017-04 will simplify the measurement of goodwill by
          eliminating step two of the two-step impairment test. Step two
          measures a goodwill impairment loss by comparing the implied fair
          value of a reporting unit’s goodwill with the carrying amount of that
          goodwill. ASU 2017-04 requires an entity to compare the fair value of
          a reporting unit with its carrying amount and recognize an impairment
          charge for the amount by which the carrying amount exceeds the
          reporting unit’s fair value. Additionally, an entity should consider
          income tax effects from any tax deductible goodwill on the carrying
          amount of the reporting unit when measuring the goodwill impairment
          loss, if applicable. ASU 2017-04 is effective for annual or any
          interim goodwill impairment tests in reporting periods beginning after
          December 15, 2022, with early adoption permitted. The Company has
          early adopted ASU 2017-04 during fiscal year 2020 and the adoption had
          no impact on the Company’s financial position or results of
          operations.
       
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          Table of Contents
       
          In June 2018, the FASB issued ASU 2018-07, Compensation-Stock
          Compensation (Topic 718): Improvements to Nonemployee Share-Based
          Payment Accounting (“ASU 2018-07”). ASU 2018-07 is intended to
          simplify aspects of share-based compensation issued to non-employees
          by making the guidance substantially consistent with the accounting
          for employee share-based compensation. ASU 2018-07 is effective for
          annual reporting periods beginning after December 15, 2019 and interim
          periods within fiscal years beginning after December 15, 2020. Early
          adoption is permitted, but not earlier than an entity’s adoption date
          of ASC 606. The Company has adopted ASU 2018-07 during fiscal year
          2020 and the adoption did not have a significant impact on the
          Company’s financial position or results of operations.
       
          In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and
          Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting
          for Implementation Costs Incurred in a Cloud Computing Arrangement
          that is a Service Contract (“ASU 2018-15”). ASU 2018-15 provides
          guidance for determining if a cloud computing arrangement is within
          the scope of internal-use software guidance and would require
          capitalization of certain implementation costs. ASU 2018-15 is
          effective for annual reporting periods beginning after December 15,
          2020 and interim periods within annual periods beginning after
          December 15, 2021, with early adoption permitted. The Company early
          adopted ASU 2018-15 during fiscal year 2020 on a prospective basis and
          this resulted in an additional $860 capitalized to Other assets on the
          Consolidated Balance Sheet.
       
          Note 3. Balance Sheet Details
       
          Property and equipment, net
       
          Property and equipment, net consisted of the following:
       
          December 31,
       
                  2019        
       
                  2020        
       
          Computers and equipment
       
          $
       
          356,535
       
          $
       
          442,778
       
          Furniture and fixtures
       
          1,511
       
          1,511
       
          Leasehold improvements
       
          6,820
       
          6,820
       
          Internal-use software
       
          50,862
       
          61,640
       
          Property and equipment, gross
       
          $
       
              415,728
       
          $
       
              512,749
       
          Less: accumulated amortization
       
          $
       
          (23,785
       
          ) 
       
          $
       
          (36,186
       
          ) 
       
          Less: accumulated depreciation
       
          (186,027
       
          ) 
       
          (237,607
       
          ) 
       
          Property and equipment, net
       
          $
       
          205,916
       
          $
       
          238,956
       
          Depreciation expense on property and equipment for the years ended
          December 31, 2018, 2019 and 2020 was $45,827, $53,707 and $62,016,
          respectively.
       
          The Company capitalized development costs related to internal-use
          software of approximately $13,784, $17,507 and $12,854 for the years
          ended December 31, 2018, 2019 and 2020, respectively. Amortization
          expense related to internal-use software for the years ended
          December 31, 2018, 2019 and 2020 was $6,588, $9,146 and $13,255,
          respectively.
       
          During the years ended December 31, 2018, 2019 and 2020, the Company
          recorded an impairment loss of $881, $546 and $1,222, respectively,
          related to software that is no longer being used. This loss on
          impairment is included in Cost of revenue and Research and development
          on the Consolidated Statements of Operations.
       
          F-19
       
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          Table of Contents
       
          Prepaid expenses and other current assets
       
          Prepaid expenses and other current assets consisted of the following:
       
          December 31,
       
                  2019        
       
                  2020        
       
          VAT and sales tax receivable
       
          $
       
          3,030
       
          $
       
          10,593
       
          Prepaid expenses
       
          2,803
       
          6,968
       
          Other receivables
       
          205
       
          880
       
          Deferred costs
       
          933
       
          2,402
       
          Total prepaid expenses and other current assets
       
          $
       
                6,971
       
          $
       
                20,843
       
          Accrued other expenses
       
          Accrued other expenses consisted of the following:
       
          December 31,
       
                  2019        
       
                  2020        
       
          Accrued bonuses
       
          $
       
          7,186
       
          $
       
          12,512
       
          Accrued capital expenditures
       
          4,122
       
          8,478
       
          Other accrued expenses
       
          4,454
       
          6,035
       
          Total accrued other expenses
       
          $
       
                15,762
       
          $
       
                  27,025
       
          Other current liabilities
       
          Other current liabilities consisted of the following:
       
          December 31,
       
                  2019        
       
                  2020        
       
          Accrued taxes
       
          $
       
          7,305
       
          $
       
          7,758
       
          Warrant liability
       
          1,638
       
          14,463
       
          Other
       
          1,133
       
          765
       
          Total other current liabilities
       
          $
       
                10,076
       
          $
       
                22,986
       
          Note 4. Fair Value Measurements
       
          The accounting guidance for fair value provides a framework for
          measuring fair value, clarifies the definition of fair value, and
          expands disclosures regarding fair value measurements. Fair value is
          defined as the price that would be received to sell an asset or paid
          to transfer a liability (an exit price) in an orderly transaction
          between market participants at the reporting date. The accounting
          guidance establishes a three tiered hierarchy, which prioritizes the
          inputs used in the valuation methodologies in measuring fair value as
          follows:
       
          Level 1 Inputs: Unadjusted quoted prices in active markets for
          identical assets or liabilities accessible to the reporting entity at
          the measurement date.
       
          Level 2 Inputs: Other than quoted prices included in Level 1, inputs
          that are observable for the asset or liability, either directly or
          indirectly, for substantially the full term of the asset or liability.
       
          Level 3 Inputs: Unobservable inputs for the asset or liability used to
          measure fair value to the extent that observable inputs are not
          available, thereby allowing for situations in which there is little,
          if any, market activity for the asset or liability at measurement
          date.
       
          F-20
       
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          Table of Contents
       
          A financial instrument’s categorization within the valuation hierarchy
          is based upon the lowest level of input that is significant to the
          fair value measurement.
       
          The following table summarizes, for the periods indicated, liabilities
          measured at fair value on a recurring basis:
       
          December 31, 2019
       
          December 31, 2020
       
          Carrying Value
       
          Fair Value
       
          Carrying Value
       
          Fair Value
       
          LEVEL 3
       
          Warrant liability
       
          $
       
                 1,638
       
          $
       
                 1,638
       
          $
       
                 14,463
       
          $
       
                 14,463
       
          During 2014 and 2015, the Company issued warrants to third parties as
          partial consideration for property and equipment primarily used in our
          co-location centers. These warrants allow the holder to purchase
          66,668 shares of Series A-1 preferred stock at $1.50 per share, and
          241,964 shares of Series A-1 preferred stock at $2.0663 per share,
          exercisable upon issuance. The warrants have a term of 10 years and
          expire at various dates through 2025.
       
          Upon issuance, the Company determined the fair value of the warrants
          using the Black-Scholes option pricing model with the following
          assumptions:
       
          Expected life in years
       
          Risk-Free Rate
       
          Expected volatility
       
          Dividend yield
       
          10
       
          2.34%-2.82%
       
          76%-78%
       
          0%
       
          Warrants outstanding as of December 31, 2019 were recorded at fair
          value based on the following assumptions:
       
          Expected life in years
       
          Risk-Free Rate
       
          Expected volatility
       
          Dividend yield
       
          4.05-4.77
       
          1.66%-1.68%
       
          51%-52%
       
          0%
       
          Warrants outstanding as of December 31, 2020 were recorded at fair
          value based on the following assumptions:
       
          Expected life in years
       
          Risk-Free Rate
       
          Expected volatility
       
          Dividend yield
       
          3.05-3.77
       
          0.17%-0.24%
       
          55%-57%
       
          0%
       
          The table below sets forth a summary of changes in the fair value of
          the warrant liability using Level 3 assumptions:
       
          Balance at January 1, 2019
       
          $
       
          1,227
       
          Fair value adjustment
       
          411
       
          Balance at December 31, 2019
       
          1,638
       
          Fair value adjustment
       
          12,825
       
          Balance at December 31, 2020
       
          $
       
              14,463
       
          The resulting loss on revaluation during the years ended December 31,
          2019 and 2020 was recorded as Other (income) expense, net on the
          Consolidated Statements of Operations.
       
          F-21
       
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          Table of Contents
       
          Note 5. Debt
       
          Debt consisted of the following at December 31:
       
                  2019        
       
                  2020        
       
          Credit Facility
       
          Term Loan(1)
       
          $
       
          68,970
       
          $
       
          165,051
       
          Revolving Credit Facility
       
          84,500
       
          63,200
       
          Capital lease obligations
       
          3,801
       
          —
       
          Notes payable
       
          33,789
       
          31,432
       
          Total debt
       
          $
       
              191,060
       
          $
       
              259,683
       
          Less: current portion
       
          Credit Facility
       
          $
       
          (5,156
       
          ) 
       
          $
       
          (7,438
       
          ) 
       
          Capital lease obligations
       
          (938
       
          ) 
       
          —
       
          Notes payable
       
          (9,063
       
          ) 
       
          (10,030
       
          ) 
       
          Current portion of long-term debt
       
          $
       
          (15,157
       
          ) 
       
          $
       
          (17,468
       
          ) 
       
          Total long-term debt
       
          $
       
          175,903
       
          $
       
          242,215
       
          (1)
       
          Amount is net of unamortized discount and debt issuance costs of
          $1,343 and $1,761 as of December 31, 2019 and 2020, respectively.
       
          2018 Credit Facility
       
          In April 2018, the Company entered into an amended and restated credit
          agreement (the “2018 Credit Facility”), with KeyBank National
          Association, as administrative agent. The 2018 Credit Facility had
          total aggregate draw down capacity of $200,000, including a $125,000
          revolver (the “2018 Revolving Credit Facility”), and a $75,000 term
          loan (the “2018 Term Loan”). The 2018 Credit Facility was set to
          mature in April 2023. The borrowings from the 2018 Credit Facility
          were used to repay and extinguish the outstanding revolver and term
          loan under the previous credit facility.
       
          The Company recognized a loss on extinguishment of debt of $550 for
          the year ended December 31, 2018, and accelerated $680 of existing
          unamortized debt issuance costs which is included in Interest expense
          on the Consolidated Statements of Operations. In connection with the
          2018 Credit Facility, the Company incurred $2,056 of debt issuance
          costs which were amortized over the term of the facility.
       
          2020 Credit Facility
       
          In February and March 2020, the Company entered into and subsequently
          amended a second amended and restated credit agreement (the “2020
          Credit Facility” and together with the 2018 Credit Facility, the
          “Credit Facility”) with KeyBank National Association as administrative
          agent. The 2020 Credit Facility has total draw down capacity of
          $320,000, with a $150,000 revolver (the “2020 Revolving Credit
          Facility”, and together with the 2018 Revolving Credit Facility, the
          “Revolving Credit Facility”) and a $170,000 term loan (the “2020 Term
          Loan”, and together with the 2018 Term Loan, the “Term Loan”). The
          2020 Credit Facility will mature on February 13, 2025. The borrowings
          from the 2020 Credit Facility were used to repay the 2018 Credit
          Facility in its entirety. The Company drew down $63,200 under the 2020
          Revolving Credit Facility, $8,200 of which was used to repay the 2018
          Revolving Credit Facility with the remainder used for working capital
          purposes as well as to strengthen the Company’s cash position and
          maintain flexibility given the uncertainty in the global economy as a
          result of the COVID-19 pandemic.
       
          The Company recognized a loss on extinguishment of debt of $259 for
          the year ended December 31, 2020, and accelerated $555 of existing
          unamortized debt issuance costs which is included in Interest expense
          on the Consolidated Statements of Operations. In connection with the
          Credit Facility, the Company will amortize $3,854 of deferred
          financing fees over the remaining term of the facility.
       
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          Table of Contents
       
          The 2020 Credit Facility is secured by a first-priority security
          interest in substantially all of the assets of the Company. The 2020
          Credit Facility contains certain financial and operational covenants,
          including a maximum ratio of net debt to EBITDA of 4.50x with
          step-downs over time, and a maximum debt service coverage ratio of
          3.00x. As of December 31, 2020, the Company was in compliance with all
          covenants under the 2020 Credit Facility.
       
          The interest rate on the 2020 Credit Facility will be, at the
          Company’s option, a per annum rate equal to either (x) LIBOR plus an
          applicable margin varying from 2.00% to 4.00% or (y) a base rate plus
          an applicable margin varying from 1.00% to 3.00%, in each case subject
          to a pricing grid based on a minimum Total Net Leverage (as defined in
          the 2020 Credit Facility) calculation.
       
          The 2020 Revolving Credit Facility provides for an annual commitment
          fee equal to 0.25% to 0.40% per annum, based on the Company’s Total
          Net Leverage ratio, applied to the average daily unused amount of the
          2020 Revolving Credit Facility. The Company incurred commitment fees
          of $284, $201 and $307 for the years ended December 31, 2018, 2019 and
          2020, respectively.
       
          Loans under the 2020 Term Loan will amortize quarterly at a per annum
          rate of 2.5% for the first year and increasing to 10.0% in the fifth
          year, of the aggregate principal amount of the loans made under the
          2020 Term Loan on the funding date, commencing June 30, 2020, with the
          balance payable February 2025. The Company may voluntarily prepay the
          2020 Term Loan without premium or penalty.
       
          Loans under the 2020 Revolving Credit Facility are due in full in
          February 2025. As the 2020 Revolving Credit Facility is a multi-year
          revolving credit agreement, the Company classifies the facility as
          long-term debt as it has the intent and ability to maintain
          outstanding for longer than 12 months.
       
          Interest and amortization of deferred financing fees for the years
          ended December 31, 2018, 2019 and 2020 was $4,978, $7,707 and $10,114,
          respectively.
       
          Capital Lease Obligations
       
          The company entered into several master lease agreements during 2018
          to lease a portion of property and equipment used in its co-location
          centers. The lease agreements were for a five year period, at the end
          of which the Company had the option to return or purchase the
          equipment. As of December 31, 2020, the Company paid the remaining
          obligations on all outstanding master lease agreements and purchased
          the equipment. Depreciation expense for property and equipment under
          capital leases the years ended December 31, 2018, 2019 and 2020 was
          $516, $1,052 and $1,052, respectively. Total interest costs incurred
          related to the property and equipment capital leases were $155, $231
          and $313 for the years ended December 31, 2018, 2019 and 2020,
          respectively.
       
          Notes Payable
       
          The Company finances a portion of property and equipment used in its
          co-location centers with the seller. The cost of the equipment
          financed by the seller is included in Property and equipment, net on
          the Consolidated Balance Sheets. During the years ended December 31,
          2018, 2019 and 2020, the Company financed property and equipment
          purchases with the seller of $49,435, $10,722 and $3,927,
          respectively. These amounts are included in the supplemental noncash
          investing and financing activities on the Consolidated Statements of
          Cash Flow. The interest rates in effect related to seller financed
          equipment was 5.5% – 5.8%, 5.6% – 6.4% and 5.5% – 6.4% for the years
          ended December 31, 2018, 2019 and 2020, respectively. Total interest
          costs incurred related to the seller financed equipment were $230,
          $843 and $1,253 for the years ended December 31, 2018, 2019 and 2020,
          respectively.
       
          Similarly, the Company also finances a portion of property and
          equipment used in its co-location centers with third-party financing
          companies. The cost of the equipment financed with a third-party is
          included in
       
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          Table of Contents
       
          Property and equipment, net on the Consolidated Balance Sheets. During
          the years ended December 31, 2018, 2019 and 2020, the Company financed
          property and equipment purchases with third parties totaling $7,984,
          $8,544, and $7,060, respectively. At the time the financing
          arrangement is executed, the amounts are included as an investing
          outflow as capital expenditures and a financing inflow as proceeds
          from financed equipment purchases on the Consolidated Statements of
          Cash Flow. The interest rates in effect related to third-party
          financed equipment was 4.0% – 5.3%, 4.0% – 6.9% and 4.3% – 6.9% for
          the years ended December 31, 2018, 2019 and 2020, respectively. Total
          interest costs incurred related to third-party financed equipment were
          $47, $524 and $1,061 for the years ended December 31, 2018, 2019 and
          2020, respectively.
       
          Outstanding Borrowings
       
          As of December 31, 2020, the expected aggregate maturities of
          long-term debt for each of the next five years are as follows:
       
          Payments Due by Period
       
          Total
       
          Less than 1
          Year
       
          1-3 Years
       
          3-5 Years
       
          Term Loan
       
          $
       
          166,813
       
          $
       
          7,438
       
          $
       
          24,438
       
          $
       
          134,937
       
          Revolving Credit Facility
       
          63,200
       
          —
       
          —
       
          63,200
       
          Notes payable
       
          31,432
       
          10,030
       
          17,653
       
          3,749
       
          Total outstanding borrowings
       
          $
       
           261,445
       
          $
       
            17,468
       
          $
       
             42,091
       
          $
       
             201,886
       
          Note 6. Operating Leases
       
          The Company leases data center facilities, office space and equipment
          under generally non-cancelable operating lease agreements, which
          expire at various dates through 2025. Facility leases generally
          include renewal options and may include escalating rental payment
          provisions. Additionally, the leases may require us to pay a portion
          of the related operating expenses. Rent expense related to these
          operating leases was $26,982, $34,897 and $41,912 for the years ended
          December 31, 2018, 2019 and 2020, respectively.
       
          As of December 31, 2020, future minimum rental payments under
          operating lease agreements were as follows:
       
          Year ending:
       
          2021
       
          $
       
          43,605
       
          2022
       
          27,473
       
          2023
       
          21,151
       
          2024
       
          19,897
       
          2025
       
          3,347
       
          Total minimum operating lease payments
       
          $
       
              115,473
       
          F-24
       
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          Table of Contents
       
          Note 7. Commitments and Contingencies
       
          Purchase Commitments
       
          As of December 31, 2020, the Company had long-term commitments for
          bandwidth usage with various networks and internet service providers
          and entered into purchase orders with various vendors. The total
          minimum future commitments for bandwidth usage and purchase orders as
          of December 31, 2020 were as follows:
       
          2021
       
          9,530
       
          2022
       
          3,803
       
          2023
       
          3,151
       
          2024
       
          3,156
       
          2025
       
          2,625
       
          Total
       
          $
       
              22,265
       
          Letters of Credit
       
          In conjunction with the execution of certain office space operating
          leases, letters of credit in the aggregate amount of $2,980 and $2,226
          were issued and outstanding as of December 31, 2019 and 2020,
          respectively. No draws have been made under such letters of credit.
          These funds are included as Restricted cash on the Consolidated
          Balance Sheets as they are related to long-term operating leases and
          are included in beginning and ending Cash, cash equivalents and
          restricted cash in the Consolidated Statements of Cash Flows. Certain
          of the letters of credit can be reduced on an annual basis until 2022,
          at which point the deposit required will similarly reduce to meet
          minimum threshold requirements.
       
          Legal Proceedings
       
          The Company may be involved in various legal proceedings and
          litigation arising in the ordinary course of business. While it is not
          feasible to predict or determine the ultimate disposition of any such
          litigation matters, the Company believes that any such legal
          proceedings will not have a material adverse effect on its
          consolidated financial position, results of operations, or liquidity.
       
          Note 8. Convertible Preferred Stock
       
          As of December 31, 2020, the Company’s Board of Directors had
          authorized the issuance of up to 45,780,861 shares of convertible
          preferred stock with a par value of $0.000025 per share.
       
          Convertible preferred stock is carried at the issuance price, net of
          issuance costs. As of December 31, 2020, convertible preferred stock
          consisted of the following:
       
          Shares
          Authorized
       
          Shares Issued
          and
          Outstanding
       
          Original
          Issuance
          Price per
          Share
       
          Carrying
          Value1
       
          Liquidation
          Preference
       
          Series Seed
       
          12,517,832
       
          12,517,832
       
          $
       
          0.26010
       
          $
       
          3,226
       
          $
       
          3,256
       
          Series A-1
       
          18,304,092
       
          17,995,460
       
          2.06630
       
          37,149
       
          37,184
       
          Series B
       
          10,237,032
       
          10,237,032
       
          8.10782
       
          82,889
       
          83,000
       
          Series C
       
          4,721,905
       
          4,721,905
       
               10.58895
       
          49,810
       
          50,000
       
          Total
       
          45,780,861
       
          45,472,229
       
          $
       
                 173,074
       
          $
       
                 173,440
       
          1)
       
          Amounts are net of issuance costs.
       
          F-25
       
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          Table of Contents
       
          Conversion
       
          Each share of preferred stock is convertible, at any time, at its
          holder’s discretion, into fully paid and non-assessable shares of
          common stock at a conversion rate of one to one. The conversion rate
          is adjusted whenever the Company issues or sells any shares of common
          stock for a consideration per share less than the conversion price in
          effect immediately prior to the issuance or sale.
       
          The preferred stock will be automatically converted into common stock
          at the conversion rate then in effect upon the earlier of a qualified
          initial public offering price of not less than $50,000 or the
          affirmative election of a majority of the outstanding shares of
          preferred stock, voting together as a single class.
       
          Notwithstanding the foregoing, the Series B preferred stock shall not
          be converted without the holders of a majority of the outstanding
          shares of Series B preferred stock voting as a single class. Upon any
          such automatic conversion, any declared and unpaid dividends shall be
          paid.
       
          Voting
       
          The holders of preferred stock are entitled to vote on all matters and
          are entitled to the number of votes equal to the number of shares of
          common stock into which each share is then convertible.
       
          The holders of Series Seed preferred stock, voting as a separate
          class, are entitled to elect one member of the Board of Directors for
          so long as 3,180,012 shares of Series Seed preferred stock remain
          outstanding.
       
          The holders of Series A-1 preferred stock, voting as a separate class,
          are entitled to elect one member of the Board of Directors for so long
          as 9,000,000 shares of Series A-1 preferred stock remain outstanding.
       
          The holders of Series B preferred stock, voting as a separate class,
          are entitled to elect one member of the Board of Directors for so long
          as 5,120,000 shares of Series B preferred stock remain outstanding.
       
          The holders of common stock, voting as a separate class, are entitled
          to elect two members of the Board of Directors.
       
          The holders of preferred stock and common stock (voting together as a
          single class and not as separate series, and on an as-converted-basis)
          shall be entitled to elect any remaining directors to our Board of
          Directors.
       
          Dividends
       
          Upon declaration by the Board of Directors, holders of preferred
          stock, in preference to the holders of common stock, shall be entitled
          on a non-cumulative basis to cash dividends at the rate of $0.0156 per
          share on each outstanding share of Series Seed preferred stock,
          $0.123975 per share for each outstanding share of Series A-1 preferred
          stock, $0.486475 per share for each outstanding share of Series B
          preferred stock and $0.63534 per share for each outstanding share of
          Series C preferred stock. The Company may not pay or declare any
          dividend or distribution on the common stock until all dividends on
          the preferred stock have been paid or declared and set apart.
       
          After payment of such dividends, any additional dividends shall be
          distributed among the holders of preferred stock and common stock pro
          rata based on the number of shares of common stock then held by each
          holder on an as-converted basis.
       
          No dividends have been declared or paid by the Company since
          inception.
       
          F-26
       
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          Table of Contents
       
          Liquidation Preference
       
          In the event of any Liquidation Transaction (as defined in the
          Company’s certificate of incorporation), whether voluntary or
          involuntary, holders of preferred stock in preference to the holders
          of common stock, shall be entitled to be paid out of the proceeds or
          assets of the Company that are available for distribution (the
          “Proceeds”) an amount equal to the applicable “Original Issue Price”
          for each preferred share held by them plus all declared and unpaid
          dividends on the preferred stock (the “Preferential Amount”). In the
          event that the Proceeds are not sufficient to pay the full
          Preferential Amount, the Proceeds shall be distributed pro rata among
          the holders of the preferred stock in proportion to the Preferential
          Amount that each such holder would otherwise be entitled to receive.
       
          After payment to the holders of the preferred stock of the respective
          Preferential Amount, the remaining Proceeds, if any, shall be
          distributed ratably to the holders of common stock.
       
          Protective Provisions
       
          The Company may not take any of the following actions, without the
          consent of the holders of at least a majority of the outstanding
          shares of preferred stock: amend the certificate of incorporation or
          bylaws; increase the total number of authorized shares of common stock
          or preferred stock; create any new series or class of shares having a
          preference or on parity with any series of preferred stock with
          respect to dividends, liquidation, voting or redemption; redeem,
          purchase or otherwise acquire any share or shares of preferred stock
          or common stock; increase or decrease the authorized number of members
          of the Board of Directors; effect a Liquidation Transaction; effect
          any reclassification or recapitalization of our outstanding capital
          stock; or incur any indebtedness for borrowed money, or guarantee any
          indebtedness, in excess of $500, other than capital leases incurred in
          the ordinary course of business and unless approved by the Board of
          Directors.
       
          Redemption
       
          The preferred stock is not mandatorily redeemable.
       
          Classification
       
          The convertible preferred stock is not mandatorily redeemable, but a
          liquidation event would constitute a redemption event outside of the
          Company’s control. Therefore, all shares of convertible preferred
          stock have been presented outside of permanent equity. Furthermore,
          the Company will not adjust the carrying value of the convertible
          preferred stock to the redemption value of such shares, since it is
          uncertain whether or when a redemption event will occur. If it becomes
          certain that the convertible preferred stock will become redeemable,
          the carrying amount will be adjusted to equal the fair value of the
          instrument on the date that the contingent event becomes certain.
       
          Note 9. Stockholders’ Deficit
       
          Common Stock
       
          Holders of common stock are entitled to one vote per share and may
          elect two directors. Holders of common stock are entitled to receive
          any dividends as may be declared from time to time by the Board of
          Directors. Common stock is subordinate to the preferred stock with
          respect to dividend rights and rights upon a Qualified Liquidation
          Event of the Company. The common stock is not redeemable at the option
          of the holder.
       
          As of December 31, 2019 and 2020, the Company had authorized shares of
          common stock of 100,000,000 and 111,400,000, respectively. In 2019,
          the Board of Directors approved an increase of 6,000,000 to the number
          of shares of common stock reserved for the Stock Plan (defined below)
          with a subsequent increase of 4,219,642 shares of common stock
          reserved for the Stock Plan in 2020.
       
          F-27
       
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          Table of Contents
       
          The Company is authorized to reserve shares of common stock for
          potential conversion as follows:
       
          December 31,
       
          2019
       
          2020
       
          Seed preferred stock
       
          12,517,832
       
          12,517,832
       
          Series A-1 preferred stock(1)
       
          18,304,108
       
          18,304,108
       
          Series B preferred stock
       
          10,274,036
       
          10,237,032
       
          Series C preferred stock
       
          —
       
          4,721,905
       
          Stock Plan
       
          30,602,000
       
          34,821,642
       
          Total number of shares for common stock reserved
       
          71,697,976
       
          80,602,519
       
          (1)
       
          Amount includes 308,632 shares of common stock held in reserve for the
          warrants.
       
          Treasury Stock
       
          The Company records treasury stock at the cost to acquire shares and
          is included as a component of Stockholders’ Deficit. At December 31,
          2019 and 2020, the Company had 1,968,228 shares of treasury stock
          which were carried at its cost basis of $4,598 on the Consolidated
          Balance Sheets.
       
          Note 10. Stock Plan
       
          The Company’s 2013 Stock Plan, which was amended and restated in May
          2020 in connection with the issuance of the Series C preferred stock
          (as amended, the “Stock Plan”), provides for the grant of incentive
          and nonqualified stock options and RSUs to employees, directors, and
          consultants up to an aggregate of 34,821,642 shares of common stock.
          As of December 31, 2020, there were 2,144,599 shares reserved for
          future issuance under the Stock Plan. Shares issued pursuant to the
          exercise of these awards are transferable by the holder. Amounts paid
          by economic interest holders in excess of fair value are recorded as
          stock-based compensation (see Note 14).
       
          Stock Options
       
          Stock options granted have a maximum term of ten years from the grant
          date, are exercisable upon vesting and vest over a period of four
          years. Stock option activity for the year ended December 31, 2020 was
          as follows:
       
          Number of
          Options
          Outstanding
       
          Weighted-
          Average
          Exercise Price
       
          Weighted-
          Average
          Remaining
          Life in Years
       
          Aggregate
          Intrinsic Value
       
          Outstanding at January 1, 2020
       
          17,998,183
       
          $
       
          4.38
       
                     8.61
       
          $
       
          29,845
       
          Granted
       
          6,002,589
       
                    10.50
       
          Exercised
       
          (4,203,490
       
          ) 
       
          3.31
       
          Forfeited or cancelled
       
          (2,863,788
       
          ) 
       
          4.90
       
          Outstanding at December 31, 2020
       
          16,933,494
       
          6.73
       
          8.44
       
                596,767
       
          Vested and exercisable at December 31, 2020
       
          5,631,666
       
          4.23
       
          7.41
       
          212,555
       
          Vested and unvested expected to vest at December 31, 2020
       
          12,967,644
       
          $
       
          6.11
       
          8.24
       
          $
       
          464,152
       
          Total cash proceeds from options exercised was $5,819 and $13,905 for
          the years ended December 31, 2019 and 2020, respectively.
       
          The aggregate intrinsic value represents the difference between the
          fair value of common stock and the exercise price of outstanding
          in-the-money options. The aggregate intrinsic value of stock options
          exercised was $15,388, $10,361 and $23,018 for the years ended
          December 31, 2018, 2019 and 2020, respectively.
       
          F-28
       
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          Table of Contents
       
          The following weighted-average assumptions were used to estimate the
          grant date fair value of stock options:
       
          December 31,
       
                  2019        
       
                  2020        
       
          Expected volatility
       
          47.84
       
          % 
       
          52.06
       
          % 
       
          Expected life in years
       
          6.0
       
          6.0
       
          Risk-free interest rate
       
          1.78
       
          % 
       
          0.57
       
          % 
       
          Dividend yield
       
          0
       
          % 
       
          0
       
          % 
       
          The weighted-average grant date fair value of options granted during
          the years ended December 31, 2018, 2019 and 2020 was $1.84, $2.62 and
          $10.01, respectively. The aggregate estimated fair value of stock
          options granted to employees that vested during the years ended
          December 31, 2018, 2019 and 2020 was $3,773, $6,338 and $9,810,
          respectively.
       
          As of December 31, 2020, there was $38,515 of unrecognized stock-based
          compensation related to outstanding stock options granted that is
          expected to be recognized over a weighted-average period of 3.3 years.
       
          RSUs
       
          RSUs granted vest over a four year period. RSU activity for the year
          ended December 31, 2020 was as follows:
       
          Shares
       
          Weighted-Average
          Fair Value
       
          Outstanding at January 1, 2020
       
          —
       
          $
       
          —
       
          Granted
       
          413,750
       
          13.69
       
          Outstanding at December 31, 2020
       
          413,750
       
          13.69
       
          Vested and expected to vest at December 31, 2020
       
          215,803
       
          $
       
              13.07
       
          As of December 31, 2020, there was $2,465 of unrecognized stock-based
          compensation related to outstanding RSUs granted that is expected to
          be recognized over a weighted-average period of 3.7 years.
       
          Stock-Based Compensation
       
          Stock-based compensation was included in the Consolidated Statements
          of Operations as follows:
       
          December 31,
       
                  2018        
       
                  2019        
       
                  2020        
       
          Cost of revenue
       
          $
       
          42
       
          $
       
          1,142
       
          $
       
          545
       
          Research and development
       
          2,559
       
          4,688
       
          7,765
       
          Sales and marketing
       
          381
       
          539
       
          1,924
       
          General and administrative
       
          9,185
       
          12,277
       
          19,222
       
          Total
       
          $
       
                12,167
       
          $
       
                18,646
       
          $
       
                29,456
       
          Stock-based compensation for the years ended December 31, 2018, 2019
          and 2020 included compensation expense of $7,950, $12,056 and $18,343,
          respectively, related to secondary sales of common stock by certain
          current and former employees, which is primarily included in General
          and administrative expense in the Consolidated Statements of
          Operations.
       
          F-29
       
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          Table of Contents
       
          Note 11. Net Loss per Share Attributable to Common Stockholders
       
          The following table presents the calculation of basic and diluted net
          loss per share:
       
          December 31,
       
                  2018        
       
                  2019        
       
                  2020        
       
          Numerator:
       
          Net loss attributable to common stockholders
       
          $
       
              (35,999
       
          ) 
       
          $
       
              (40,390
       
          ) 
       
          $
       
              (43,568)
       
          Denominator:
       
          Weighted average shares used to compute net loss per share, basic and
          diluted
       
          33,971
       
          38,004
       
          41,658
       
          Net loss per share attributable to common stockholders, basic and
          diluted
       
          $
       
          (1.06
       
          ) 
       
          $
       
          (1.06
       
          ) 
       
          $
       
          (1.05
       
          ) 
       
          Potentially dilutive securities that were not included in the diluted
          per share calculations because they would be anti-dilutive were as
          follows:
       
          December 31,
       
                  2018        
       
                  2019        
       
                  2020        
       
          Series Seed
       
          12,517,832
       
          12,517,832
       
          12,517,832
       
          Series A-1
       
          17,995,460
       
          17,995,460
       
          17,995,460
       
          Series B
       
          10,237,032
       
          10,237,032
       
          10,237,032
       
          Series C
       
          —
       
          —
       
          4,721,905
       
          Warrants
       
          308,632
       
          308,632
       
          308,632
       
          Stock Options
       
          16,336,878
       
          17,998,183
       
          16,933,494
       
          RSUs
       
          —
       
          —
       
          413,750
       
          Total
       
          57,395,834
       
          59,057,139
       
          63,128,105
       
          Note 12. Income Taxes
       
          Loss before income taxes from U.S. and foreign operations were as
          follows:
       
          December 31,
       
                  2018        
       
                  2019        
       
                  2020        
       
          U.S.
       
          $
       
          (36,059
       
          ) 
       
          $
       
          (40,985
       
          ) 
       
          $
       
          (44,163
       
          ) 
       
          Foreign
       
          1,281
       
          1,388
       
          1,506
       
          Total loss before income taxes
       
          $
       
              (34,778
       
          ) 
       
          $
       
              (39,597
       
          ) 
       
          $
       
              (42,657)
       
          Total income tax expense included in the Consolidated Statements of
          Operations is comprised of the following:
       
          December 31,
       
                  2018        
       
                  2019        
       
                  2020        
       
          Current:
       
          Federal
       
          $
       
          —
       
          $
       
          —
       
          $
       
          —
       
          State
       
          76
       
          66
       
          59
       
          Foreign
       
          1,204
       
          735
       
          781
       
          Total current
       
          $
       
          1,280
       
          $
       
          801
       
          $
       
          840
       
          Deferred:
       
          Federal
       
          $
       
          29
       
          $
       
          (6
       
          ) 
       
          $
       
          81
       
          F-30
       
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          Table of Contents
       
          December 31,
       
                  2018        
       
                  2019        
       
                  2020        
       
          State
       
          1
       
          12
       
          32
       
          Foreign
       
          (89
       
          ) 
       
          (14
       
          ) 
       
          (42
       
          ) 
       
          Total deferred
       
          (59
       
          ) 
       
          (8
       
          ) 
       
          71
       
          Total income tax expense
       
          $
       
                  1,221
       
          $
       
                    793
       
          $
       
                     911
       
          Total income tax expense differs from applying the statutory U.S.
          federal income tax rate to loss before income taxes due to permanent
          differences between income for tax purposes and income for book
          purposes, state income taxes, and foreign income taxes.
       
          The following table reconciles our benefit of income taxes at the
          statutory rate to the effective tax rate, using a U.S. federal
          statutory tax rate of 21%:
       
          December 31,
       
                  2018        
       
                  2019        
       
                  2020        
       
          Tax benefit at federal statutory rate
       
          $
       
          (7,240
       
          ) 
       
          $
       
          (8,316
       
          ) 
       
          $
       
               (8,957)
       
          State and local taxes, net of federal benefit
       
          61
       
          65
       
          72
       
          Foreign tax rate differential
       
          105
       
          98
       
          136
       
          Stock-based compensation
       
          1,360
       
          2,602
       
          4,001
       
          Nondeductible/nontaxable items
       
          310
       
          395
       
          149
       
          Unrecognized tax positions
       
          707
       
          257
       
          119
       
          Change in valuation allowance
       
          3,410
       
              5,564
       
          5,578
       
          Return to provision adjustment
       
          1,615
       
          —
       
          —
       
          GILTI
       
          334
       
          270
       
          199
       
          Other
       
          559
       
          (142
       
          ) 
       
          (386
       
          ) 
       
          Total income tax expense
       
          $
       
                  1,221
       
              $
       
          793
       
          $
       
          911
       
          The components of deferred tax assets and liabilities are as follows:
       
          December 31,
       
                  2019        
       
                  2020        
       
          Deferred tax assets:
       
          Accounts receivable
       
          $
       
          1,251
       
          $
       
          737
       
          Accrued expenses
       
          957
       
          602
       
          Net operating loss carryforwards
       
          21,193
       
          23,779
       
          Warrant liability
       
          377
       
          3,276
       
          Stock-based compensation
       
          1,095
       
          1,573
       
          Rent payable
       
          743
       
          629
       
          Other
       
          199
       
          121
       
          Total deferred tax assets
       
          25,815
       
          30,717
       
          Less: valuation allowance
       
          (15,372
       
          ) 
       
               (20,950)
       
          Total net deferred tax asset
       
          $
       
          10,443
       
          $
       
          9,767
       
          Deferred tax liability
       
          Depreciation and amortization
       
          $
       
               (10,491
       
          ) 
       
          $
       
          (9,896
       
          ) 
       
          Net deferred tax (liability) asset
       
          $
       
          (48
       
          ) 
       
          $
       
          (129
       
          ) 
       
          F-31
       
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          Table of Contents
       
          As of December 31, 2020, the Company had federal net operating loss
          (“NOL”) carryforwards of $103,153, which will begin to expire on
          various dates from 2032 through 2037, and state and local NOL
          carryforwards of $128,131, which will begin to expire on various dates
          from 2021 through 2039.
       
          NOL Carryforward
       
          Total
       
          1-3
          Years
       
          3-5
          Years
       
          More than 5
          Years
       
          Unlimited
       
          Federal
       
          $
       
          103,153
       
          $
       
          —
       
          $
       
          —
       
          $
       
          47,617
       
          $
       
          55,536
       
          State and local
       
          128,131
       
          472
       
          190
       
          113,315
       
          14,154
       
          Total
       
          $
       
              231,284
       
          $
       
              472
       
          $
       
              190
       
          $
       
              160,932
       
          $
       
              69,690
       
          Certain tax attributes may be subject to an annual limitation as a
          result of the issuance of stock, which may constitute a change of
          ownership as defined under Internal Revenue Code Section 382. The
          Company has not performed a formal Internal Revenue Code Section 382
          study to determine if an annual limitation may apply.
       
          The Company assesses the likelihood of its ability to realize the
          benefit of its deferred tax assets in each jurisdiction by evaluating
          all relevant positive and negative evidence. A valuation allowance is
          established if it is determined that any portion of the deferred tax
          assets is not more likely than not to be realized. For the year ended
          December 31, 2020, the Company determined that the existence of a
          three-year cumulative loss incurred in its U.S. jurisdiction,
          inclusive of 2020, constituted sufficiently strong negative evidence
          to warrant the establishment of a valuation allowance. As a result, a
          valuation allowance of $20,950 as of December 31, 2020 has been
          recorded against the Company’s U.S. deferred tax assets.
       
          The valuation allowance activity for the periods indicated is as
          follows:
       
          December 31,
       
                  2019        
       
                  2020        
       
          Balance as of the beginning of period
       
          $
       
          (9,808
       
          ) 
       
          $
       
          (15,372
       
          ) 
       
          Additions charged to expense
       
          (5,564
       
          ) 
       
          (5,578
       
          ) 
       
          Balance as of the end of period
       
          $
       
              (15,372
       
          ) 
       
          $
       
              (20,950)
       
          In general, it is our practice and intention to reinvest the earnings
          of our non-U.S. subsidiaries in those operations. Generally, such
          amounts become subject to U.S. taxation upon the remittance of
          dividends and under certain other circumstances. The amount of
          undistributed earnings of non-U.S. subsidiaries at December 31, 2020,
          as well as the related deferred income tax, if any, is not material.
       
          The Company files U.S. federal income tax returns as well as various
          state, local and foreign jurisdictions. As of December 31, 2020, tax
          years 2016 and later remain open for examination.
       
          On December 22, 2017, the Tax Act was enacted, containing significant
          changes to the U.S. tax law, including lowering the U.S. corporate
          income tax rate to 21%, implementing a territorial tax system which
          includes a new federal tax on GILTI, and imposing a one-time tax on
          deemed repatriation of earnings of foreign subsidiaries (“transition
          tax”).
       
          Effective January 1, 2018, the Company became subject to several
          provisions of the Tax Act including provisions impacting certain
          foreign income, such as tax on GILTI. The Company does not currently
          meet the revenue threshold for the Base Erosion and Anti-Abuse Tax
          (“BEAT”).
       
          The Company has elected to treat taxes due on GILTI using the period
          cost method. The Company will continue to monitor the forthcoming
          regulations and additional guidance of the GILTI and BEAT provisions
          under the Tax Act, which are complex and subject to continuing
          regulatory interpretation by the Internal Revenue Service.
       
          F-32
       
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          Table of Contents
       
          The Tax Act requires companies to pay a one-time transition tax, net
          of tax credits related to applicable foreign taxes paid, on previously
          untaxed current and accumulated earnings and profits (“E&P”) of our
          foreign subsidiaries. In the determination of the deemed repatriation
          tax, the Company reviewed post-1986 E&P, and any related non-U.S.
          income tax paid on such earnings. This amount is not considered to be
          material to our liquidity and capital resources.
       
          ASC 740 clarifies the accounting and reporting for uncertainties in
          income tax law and prescribes a comprehensive model for financial
          statement recognition measurement, presentation and disclosure of
          uncertain tax positions taken or expected to be taken in income tax
          returns. ASC 740 requires that tax effects of an uncertain tax
          position be recognized only if it is “more likely than not” to be
          sustained by the taxing authority as of the reporting date.
       
          Amounts included in the balance of unrecognized tax benefits as of
          December 31, 2018, 2019 and 2020, if recognized, would affect the
          effective tax rate upon recognition. A reconciliation of the beginning
          and ending amount of unrecognized tax benefits is as follows:
       
          December 31,
       
                  2018        
       
                  2019        
       
                  2020        
       
          Balance of unrecognized tax benefits at beginning of year
       
          $
       
          —
       
          $
       
          520
       
          $
       
          752
       
          Additions based on tax positions related to the current period
       
          210
       
          340
       
          70
       
          Additions for tax positions of prior periods
       
          310
       
          —
       
          —
       
          Reductions for tax positions of prior periods
       
          —
       
          (108
       
          ) 
       
          —
       
          Balance of unrecognized tax benefits at end of year
       
          $
       
                      520
       
          $
       
                      752
       
          $
       
                      822
       
          Note 13. Employee Benefit Plan
       
          The Company offers U.S. employees a voluntary retirement savings plan
          under Section 401(k) of the Internal Revenue Code (the “401(k) Plan”),
          which permits employees to elect to contribute a portion of their
          pre-tax wages to the 401(k) Plan. Under this plan, the Company matches
          100% of participants’ contributions up to 3% of compensation and 50%
          of participants’ contributions between 3% and 5%. For the years ended
          December 31, 2018, 2019 and 2020, the Company made contributions of
          $1,845, $2,331 and $2,779 to the 401(k) Plan, respectively.
       
          Note 14. Related Party Transactions
       
          During the years ended December 31, 2018, 2019 and 2020, the Company
          recorded $7,950, $12,056 and $18,343, respectively, of stock-based
          compensation associated with secondary sale transactions. The
          secondary sales transactions were executed primarily between holders
          of economic interest in the Company and the Company’s employees and
          former employees at prices in excess of the fair value of such shares.
          Accordingly, the Company recognized such excess value as stock-based
          compensation. The Company did not sell any shares or receive any
          proceeds from the transactions.
       
          Note 15. Subsequent Events
       
          Management has evaluated subsequent events occurring through
          February 25, 2021, the date that these financial statements were
          issued, and determined that no additional subsequent events occurred
          that would require recognition or disclosure in these consolidated
          financial statements, except as described above.
       
          F-33
       
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          LOGO
       
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          Table of Contents
       
          PART II
       
          INFORMATION NOT REQUIRED IN PROSPECTUS
       
          Unless otherwise indicated, all references to “DigitalOcean,” the
          “company,” “we,” “our,” “us” or similar terms refer to DigitalOcean
          Holdings, Inc. and its consolidated subsidiaries.
       
          Item 13. Other Expenses of Issuance and Distribution.
       
          The following table sets forth all expenses to be paid by us, other
          than underwriting discounts and commissions, in connection with this
          offering. All amounts shown are estimates except for the SEC
          registration fee, the FINRA filing fee and the exchange listing fee.
       
          SEC registration fee
       
          $
       
          10,910
       
          FINRA filing fee
       
          14,850
       
          Exchange listing fee
       
          *
       
          Printing and engraving expenses
       
          *
       
          Legal fees and expenses
       
          *
       
          Accounting fees and expenses
       
          *
       
          Custodian transfer agent and registrar fees
       
          *
       
          Miscellaneous
       
          *
       
          Total
       
          $
       
          *
       
          *
       
          To be filed by amendment.
       
          Item 14. Indemnification of Directors and Officers.
       
          Section 145 of the Delaware General Corporation Law authorizes a court
          to award, or a corporation’s board of directors to grant, indemnity to
          directors and officers in terms sufficiently broad to permit such
          indemnification under certain circumstances for liabilities, including
          reimbursement for expenses incurred, arising under the Securities Act.
          Our amended and restated certificate of incorporation that will be in
          effect on the completion of this offering permits indemnification of
          our directors, officers, employees and other agents to the maximum
          extent permitted by the Delaware General Corporation Law, and our
          amended and restated bylaws that will be in effect on the completion
          of this offering provide that we will indemnify our directors and
          officers and permit us to indemnify our employees and other agents, in
          each case to the maximum extent permitted by the Delaware General
          Corporation Law.
       
          We have entered into indemnification agreements with our directors and
          officers, whereby we have agreed to indemnify our directors and
          officers to the fullest extent permitted by law, including
          indemnification against expenses and liabilities incurred in legal
          proceedings to which the director or officer was, or is threatened to
          be made, a party by reason of the fact that such director or officer
          is or was a director, officer, employee or agent of DigitalOcean,
          provided that such director or officer acted in good faith and in a
          manner that the director or officer reasonably believed to be in, or
          not opposed to, the best interest of DigitalOcean Holdings, Inc. At
          present, there is no pending litigation or proceeding involving a
          director or officer of DigitalOcean Holdings, Inc. regarding which
          indemnification is sought, nor is the registrant aware of any
          threatened litigation that may result in claims for indemnification.
       
          We maintain insurance policies that indemnify our directors and
          officers against various liabilities arising under the Securities Act
          and the Securities Exchange Act of 1934, as amended, that might be
          incurred by any director or officer in his capacity as such.
       
          The underwriters are obligated, under certain circumstances, under the
          underwriting agreement to be filed as Exhibit 1.1 hereto, to indemnify
          us and our officers and directors against liabilities under the
          Securities Act.
       
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          Item 15. Recent Sales of Unregistered Securities.
       
          The following sets forth information regarding all unregistered
          securities sold since January 1, 2017:
       
          Sale of Preferred Stock
       
          In May 2020, we sold an aggregate of 4,721,905 shares of Series C
          preferred stock to a total of three accredited investors at a purchase
          price of $10.58895 per share for an aggregate purchase price of
          $50,000,016.
       
          Equity Plan-Related Issuances
       
          From January 1, 2017 through the date of this registration statement,
          we granted to our employees, directors and consultants options to
          purchase an aggregate of 28,964,522 shares of our common stock with
          per share exercise prices ranging from $2.3325 to $19.47 under our
          2013 Plan.
       
          From January 1, 2017 through the date of this registration statement,
          we issued an aggregate of 14,968,683 shares upon the exercise of
          options granted under the 2013 Plan for aggregate consideration of
          $27,970,580.
       
          From January 1, 2017 through the date of this registration statement,
          we granted to our employees, directors and consultants an aggregate of
          2,068,088 RSUs to be settled in shares of our common stock under our
          2013 Plan.
       
          None of the foregoing transactions involved any underwriters,
          underwriting discounts or commissions, or any public offering. Unless
          otherwise specified above, we believe these transactions were exempt
          from registration under the Securities Act in reliance on Section 4(2)
          of the Securities Act (and Regulation D or Regulation S promulgated
          thereunder) or Rule 701 promulgated under Section 3(b) of the
          Securities Act as transactions by an issuer not involving any public
          offering or under benefits plans and contracts relating to
          compensation as provided under Rule 701. The recipients of the
          securities in each of these transactions represented their intentions
          to acquire the securities for investment only and not with a view to
          or for sale in connection with any distribution thereof, and
          appropriate legends were placed on the share certificates issued in
          these transactions. All recipients had adequate access, through their
          relationships with us, to information about us. The sales of these
          securities were made without any general solicitation or advertising.
       
          Item 16. Exhibits and Financial Statement Schedules.
       
          (a)    Exhibits.
       
          See the Exhibit Index on the page immediately preceding the signature
          page for a list of exhibits filed as part of this registration
          statement on Form S-1, which Exhibit Index is incorporated herein by
          reference.
       
          (b)    Financial Statement Schedules.
       
          All financial statement schedules are omitted because the information
          required to be set forth therein is not applicable or is shown in the
          financial statements or the notes thereto.
       
          Item 17. Undertakings.
       
          The undersigned registrant hereby undertakes to provide to the
          underwriters at the closing specified in the underwriting agreement
          certificates in such denominations and registered in such names as
          required by the underwriters to permit prompt delivery to each
          purchaser.
       
          Insofar as indemnification for liabilities arising under the
          Securities Act may be permitted to directors, officers and controlling
          persons of the registrant under the foregoing provisions or otherwise,
          the registrant has been advised that in the opinion of the SEC such
          indemnification is against public policy as expressed in the
          Securities Act and is, therefore, unenforceable. In the event that a
          claim for indemnification against such
       
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          liabilities (other than the payment by the registrant of expenses
          incurred or paid by a director, officer or controlling person of the
          registrant in the successful defense of any action, suit or
          proceeding) is asserted by such director, officer or controlling
          person in connection with the securities being registered, the
          registrant will, unless in the opinion of its counsel the matter has
          been settled by controlling precedent, submit to a court of
          appropriate jurisdiction the question whether such indemnification by
          it is against public policy as expressed in the Securities Act and
          will be governed by the final adjudication of such issue.
       
          The undersigned registrant hereby undertakes that:
       
          (1)    For purposes of determining any liability under the Securities
          Act, the information omitted from the form of prospectus filed as part
          of this registration statement in reliance on Rule 430A and contained
          in a form of prospectus filed by the registrant under Rule 424(b)(1)
          or (4) or 497(h) under the Securities Act will be deemed to be part of
          this registration statement as of the time it was declared effective.
       
          (2)    For the purpose of determining any liability under the
          Securities Act of 1933, each post-effective amendment that contains a
          form of prospectus will be deemed to be a new registration statement
          relating to the securities offered therein, and the offering of such
          securities at that time will be deemed to be the initial bona fide
          offering thereof.
       
          (3)    That, for the purpose of determining liability under the
          Securities Act of 1933 to any purchaser:
       
          If the registrant is subject to Rule 430C, each prospectus filed
          pursuant to Rule 424(b) as part of a registration statement relating
          to an offering, other than registration statements relying on Rule
          430B or other than prospectuses filed in reliance on Rule 430A, shall
          be deemed to be part of and included in the registration statement as
          of the date it is first used after effectiveness. Provided, however,
          that no statement made in a registration statement or prospectus that
          is part of the registration statement or made in a document
          incorporated or deemed incorporated by reference into the registration
          statement or prospectus that is part of the registration statement
          will, as to a purchaser with a time of contract of sale prior to such
          first use, supersede or modify any statement that was made in the
          registration statement or prospectus that was part of the registration
          statement or made in any such document immediately prior to such date
          of first use.
       
          (4)    For the purpose of determining liability of the registrant
          under the Securities Act of 1933 to any purchaser in the initial
          distribution of the securities, the undersigned registrant undertakes
          that, in a primary offering of securities of the undersigned
          registrant pursuant to this registration statement, regardless of the
          underwriting method used to sell the securities to the purchaser, if
          the securities are offered or sold to such purchaser by means of any
          of the following communications, the undersigned registrant will be a
          seller to the purchaser and will be considered to offer or sell such
          securities to such purchaser:
       
          (a)    any preliminary prospectus or prospectus of the undersigned
          registrant relating to the offering required to be filed pursuant to
          Rule 424 under the Securities Act;
       
          (b)    any free writing prospectus relating to the offering prepared
          by or on behalf of the undersigned registrant or used or referred to
          by the undersigned registrant;
       
          (c)    the portion of any other free writing prospectus relating to
          the offering containing material information about the undersigned
          registrant or its securities provided by or on behalf of the
          undersigned registrant; and
       
          (d)    any other communication that is an offer in the offering made
          by the undersigned registrant to the purchaser.
       
          II-3
       
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          EXHIBIT INDEX
       
          Exhibit
          Number
       
          Description
       
            1.1*
       
          Form of Underwriting Agreement.
       
            3.1
       
          [1]Amended and Restated Certificate of Incorporation of Registrant, as
          currently in effect.
       
            3.2
       
          [2]Form of Amended and Restated Certificate of Incorporation of
          Registrant, to be in effect on the completion of the offering.
       
            3.3
       
          [3]Bylaws of Registrant, as currently in effect.
       
            3.4
       
          [4]Form of Amended and Restated Bylaws of Registrant, to be in effect
          on the completion of the offering.
       
            4.1
       
          [5]Form of Common Stock Certificate.
       
            5.1*
       
          Opinion of Cooley LLP.
       
          10.1
       
          [6]Amended and Restated Investors’ Rights Agreement, dated as of
          May 8, 2020, by and among the Registrant and certain of its
          stockholders.
       
          10.2+
       
          [7]DigitalOcean Holdings, Inc. 2013 Stock Plan, as amended.
       
          10.2.1+
       
          [8]Form of Option Agreement, Notice of Stock Option Grant and Exercise
          Notice under 2013 Stock Plan.
       
          10.2.2+
       
          [9]Form of Restricted Stock Unit Award Agreement under 2013 Stock
          Plan.
       
          10.3+*
       
          DigitalOcean Holdings, Inc. 2021 Equity Incentive Plan.
       
          10.3.1+*
       
          Form of Option Agreement, Notice of Stock Option Grant and Exercise
          Notice under 2021 Equity Incentive Plan.
       
          10.3.2+*
       
          Form of Restricted Stock Unit Award Agreement under 2021 Equity
          Incentive Plan.
       
          10.4+*
       
          DigitalOcean Holdings, Inc. 2021 Employee Stock Purchase Plan.
       
          10.5+
       
          [10]Non-Employee Director Compensation Policy.
       
          10.6+
       
          [11]Form of Indemnification Agreement entered into by and between
          Registrant and each director and executive officer.
       
          10.7+*
       
          Offer Letter between Registrant and Yancey Spruill, dated July 3,
          2019.
       
          10.8
       
          [12]Second Amended and Restated Credit Agreement, dated as of
          February 13, 2020, between the Registrant, DigitalOcean, LLC, KeyBank
          National Association and the other parties thereto.
       
          10.9
       
          [13]Amendment No. 1 and Incremental Term Loan Assumption Agreement,
          dated as of March  18, 2020, between the Registrant, ServerStack,
          Inc., Morgan Stanley Senior Funding, Inc., KeyBank National
          Association and the other parties thereto.
       
          21.1
       
          [14]List of Subsidiaries.
       
          23.1
       
          [15]Consent of Ernst & Young LLP, independent registered public
          accounting firm.
       
          23.2*
       
          Consent of Cooley LLP (included in Exhibit 5.1).
       
          24.1
       
          Power of Attorney (included on signature page).
       
          *
       
          To be submitted by amendment.
       
          +
       
          Indicates management contract or compensatory plan.
       
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          SIGNATURES
       
          Pursuant to the requirements of the Securities Act of 1933, the
          registrant has duly caused this registration statement to be signed on
          its behalf by the undersigned, thereunto duly authorized, in the City
          of New York, State of New York, on February 25, 2021.
       
          DIGITALOCEAN HOLDINGS, INC.
       
          By:
       
          /s/ Yancey Spruill
       
          Name:     Yancey Spruill
       
          Title:       Chief Executive Officer
       
          POWER OF ATTORNEY
       
          KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
          appears below constitutes and appoints Yancey Spruill and Alan
          Shapiro, and each one of them, as his or her true and lawful
          attorneys-in-fact and agents, with full power of substitution and
          resubstitution, for him or her and in their name, place and stead, in
          any and all capacities, to sign any and all amendments (including
          post-effective amendments) to this registration statement, and to sign
          any registration statement for the same offering covered by this
          registration statement that is to be effective on filing pursuant to
          Rule 462(b) under the Securities Act of 1933, as amended, and all
          post-effective amendments thereto, and to file the same, with all
          exhibits thereto and other documents in connection therewith, with the
          Securities and Exchange Commission, granting unto said
          attorneys-in-fact and agents, and each of them, full power and
          authority to do and perform each and every act and thing requisite and
          necessary to be done in connection therewith, as fully to all intents
          and purposes as he or she might or could do in person, hereby
          ratifying and confirming all that said attorneys-in-fact and agents or
          any of them, or his or her substitute or substitutes, may lawfully do
          or cause to be done by virtue hereof.
       
          Pursuant to the requirements of the Securities Act of 1933, this
          registration statement has been signed by the following persons in the
          capacities and on the dates indicated.
       
          Signature
       
          Title
       
          Date
       
          /s/ Yancey Spruill
       
          Yancey Spruill
       
          Chief Executive Officer and Director
          (Principal Executive Officer)
       
          February 25, 2021
       
          /s/ William Sorenson
       
          William Sorenson
       
          Chief Financial Officer
          (Principal Financial and Accounting Officer)
       
          February 25, 2021
       
          /s/ Warren Adelman
       
          Warren Adelman
       
          Director
       
          February 25, 2021
       
          /s/ Pratima Arora
       
          Pratima Arora
       
          Director
       
          February 25, 2021
       
          /s/ Amy Butte
       
          Amy Butte
       
          Director
       
          February 25, 2021
       
          /s/ Warren Jenson
       
          Warren Jenson
       
          Director
       
          February 25, 2021
       
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          Signature
       
          Title
       
          Date
       
          /s/ Pueo Keffer
       
          Pueo Keffer
       
          Director
       
          February 25, 2021
       
          /s/ Peter Levine
       
          Peter Levine
       
          Director
       
          February 25, 2021
       
          /s/ Hilary Schneider
       
          Hilary Schneider
       
          Director
       
          February 25, 2021
       
          II-6
       
          
       
          1. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex31.htm
          2. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex32.htm
          3. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex33.htm
          4. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex34.htm
          5. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex41.htm
          6. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex101.htm
          7. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex102.htm
          8. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex1021.htm
          9. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex1022.htm
          10. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex105.htm
          11. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex106.htm
          12. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex108.htm
          13. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex109.htm
          14. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex211.htm
          15. https://www.sec.gov/Archives/edgar/data/1582961/000119312521055798/d898181dex231.htm