DEF 14A: Braze, Inc. Announces Details for 2024 Annual Stockholders Meeting and Executive Compensation

Braze, Inc. has released its proxy statement detailing the agenda for the 2024 Annual Meeting of Stockholders, director nominations, executive compensation, and other corporate governance matters.

Summary

• Braze, Inc. will hold its Annual Meeting of Stockholders virtually on June 27, 2024.
• Stockholders of record as of April 29, 2024, are eligible to vote.
• The meeting agenda includes the election of three Class III directors (William Magnuson, David Obstler, and Tara Walpert Levy), an advisory vote on executive compensation, and ratification of Ernst & Young LLP as the independent registered public accounting firm for the fiscal year ending January 31, 2025.
• The proxy statement details the compensation of named executive officers (NEOs), including base salary, performance-based cash bonuses, and long-term equity incentives.
• In fiscal year 2024, Braze's revenue was $471.8 million, a 33% increase year-over-year, with a gross margin of 68.7%.
• Dollar-based net retention for all customers was 117%, and for customers with ARR of $500,000 or more, it was 120%.
• The company had 2,044 customers as of January 31, 2024, with 202 having ARR of $500,000 or more.
• Executive compensation includes base salaries ranging from $365,000 to $490,000, target bonus opportunities, and RSU grants.
• The compensation committee approved actual performance-based cash bonus award payments in March 2024, with achievement of the corporate performance goals for the full 2024 fiscal year determined to be 98%.

Sentiment

Score: 7

Explanation: The document presents a generally positive outlook, highlighting revenue growth and customer retention. However, the operating loss and the need for continued investment temper the overall sentiment.

Positives

• The company experienced significant revenue growth of 33% in fiscal year 2024.
• Dollar-based net retention rates remain strong, indicating customer satisfaction and loyalty.
• The company is expanding its customer base, particularly among high-value clients.
• Executive compensation is tied to company performance through performance-based cash bonuses and equity incentives.
• The company has adopted a compensation recoupment policy.
• The company prohibits hedging and pledging of Braze stock by employees and directors.

Negatives

• The company reported an operating loss of $144.7 million for the fiscal year.
• The proxy statement notes that one report, covering an aggregate of two transactions, was filed late by Bill Magnuson, and two reports, covering an aggregate of two transactions, were filed late by Isabelle Winkles.

Risks

• The division of the board of directors into three classes with staggered three-year terms may delay or prevent a change of management or a change in control of Braze.
• The payments and benefits provided under the executive severance plan in connection with a change in control may not be eligible for a federal income tax deduction by us pursuant to Section 280G of the Code.
• 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.

Future Outlook

Braze believes the flexibility and versatility of its platform, including investments in first-party data activation, artificial intelligence, and cross-channel actions, will support growing investment in Customer Engagement across industries and drive enormous future value for the business.

Management Comments

• Braze has a role to play across teams, including marketing, product and data science, even as we keep the marketer at the center, empowering them with a platform that is both comprehensive and powerful, while remaining easy to learn and intuitive to use.
• We believe that Braze is an integral part of this evolution for any brand, and we take pride in helping brands assess where they are today and confidently guiding them towards where they want to be.
• As the Customer Engagement category matures, we remain committed to creating long-lasting value for businesses of all kinds.

Industry Context

The document emphasizes the increasing importance of first-party relationships and data in customer engagement, positioning Braze as a leader in this emerging category. It highlights the shift from traditional outbound marketing to more tailored and relevant customer experiences across various touchpoints, including web, digital messages, in-product engagements, and augmented reality environments.

Comparison to Industry Standards

• The document does not provide specific comparisons to industry standards or benchmarks.
• However, it mentions peer companies used for compensation benchmarking, including Amplitude, GitLab, SEMrush Holdings, Asana, Jamf Holding, Smartsheet, BlackLine, JFrog, Sprinklr, C3.ai, nCino, Sprout Social, Confluent, PagerDuty, Varonis Systems, DoubleVerify Holdings, Procore Technologies, Workiva, EngageSmart, Rapid7, Samsara, and Zoominfo Technologies.
• These companies are considered reasonably comparable to Braze in terms of maturity, industry, market capitalization, and financial characteristics.

Related Party Transactions

• Mr. Obstler also serves as the Chief Financial Officer of Datadog, Inc., one of our vendors.
• We have purchased services from Datadog, Inc. in the aggregate amount of approximately $2.5 million in the fiscal year ended January 31, 2024.

Stakeholder Impact

• The company aims to create long-lasting value for businesses of all kinds, including communities, customers, and stockholders.
• Executive compensation is designed to align management's interests with those of stockholders.
• The company is committed to sustainable practices, including hosting a virtual annual meeting to reduce costs and environmental impact.

Next Steps

• Stockholders are encouraged to vote on the proposals outlined in the proxy statement.
• The company will hold its Annual Meeting of Stockholders on June 27, 2024.
• The board of directors and compensation committee will consider the outcome of the advisory vote on executive compensation when making future decisions.

Key Dates

Keywords

executive compensation, annual meeting, proxy statement, board of directors, stockholders, revenue, customer engagement, Braze