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Equity Incentive Plans and Stock-Based Compensation
 12 Months Ended
Jan. 31, 2023
Share-Based Payment Arrangement [Abstract]  
Equity Incentive Plans and Stock-Based Compensation
13Equity Incentive Plans and Stock-Based Compensation
2021 Stock Plan
In April 2021, prior to and in connection with the IPO, we adopted the 2021 Plan, which provides for grants of incentive stock options, nonstatutory stock options, stock appreciation rights, RSAs, RSUs, performance awards, and other forms of awards. As of January 31, 2023, we have reserved 145.9 million shares of our Class A common stock to be issued under the 2021 Plan. In addition, the number of shares of our Class A common stock reserved for issuance under the 2021 Plan will automatically increase on February 1 of each year for a period of 10 years, beginning on February 1, 2022 and continuing through February 1, 2031, in an amount equal to (1) 5% of the total number of shares of our common stock (both Class A and Class B) outstanding on the preceding January 31, or (2) a lesser number of shares determined by our board of directors no later than the February 1 increase.
2021 Employee Stock Purchase Plan
In April 2021, prior to and in connection with the IPO, we adopted the ESPP. As of January 31, 2023, the ESPP authorizes the issuance of 15.9 million shares of our Class A common stock under purchase rights granted to our employees or to employees of any of our designated affiliates. The number of shares of our Class A common stock reserved for issuance will automatically increase on February 1 of each year for a period of 10 years, beginning on February 1, 2022 and continuing through February 1, 2031, by the lesser of (1) 1% of the total number of shares of our common stock (both Class A and Class B) outstanding on the preceding January 31; and (2) 15.5 million shares, except before the date of any such increase, our board of directors may determine that such increase will be less than the amount set forth by (1) and (2) above. The plan allows participants to purchase shares at the lesser of (a) 85% of the fair market value our Class A common stock as of the commencement of the offering period, and (b) 85% of the fair market value of our Class A common stock on the corresponding purchase date.
Prior Stock Plans
In June 2015, we adopted the 2015 Plan. The 2015 Plan was terminated in June 2018 in connection with the adoption of the 2018 Plan. Accordingly, no shares are available for future issuance under the 2015 Plan following the adoption of the 2018 Plan.
In June 2018, we adopted the 2018 Plan, which provided for grants of stock-based awards, including RSUs, RSAs, and stock options. The 2018 Plan was terminated in April 2021 in connection with the adoption of the 2021 Plan. Accordingly, no shares are available for future issuance under the 2018 Plan following the adoption of the 2021 Plan.
Outstanding Equity Awards
Stock Options
Stock options generally vest over four years and expire ten years from the date of grant. Vested stock options generally expire three months after termination of employment. Stock option activity during fiscal year 2023 was as follows:
Options Outstanding
Stock Options (in thousands)Weighted-Average
Exercise Price		Weighted-Average
Remaining Contractual
Life (Years)		Aggregate Intrinsic
Value (in thousands)
Balance as of January 31, 2022
14,544 $1.64 7.6$507,419 
Granted5,027 $6.61 
Exercised(4,770)$1.73 
Forfeited(903)$3.01 
Expired— $— 
Balance as of January 31, 2023
13,898 $3.32 7.7$169,324 
Vested and exercisable as of January 31, 2023
6,740 $1.87 6.3$90,911 
The weighted-average grant date fair value of stock options granted during fiscal years 2023, 2022, and 2021 was $12.23, $45.78 and $17.45 per share, respectively. The intrinsic value of stock options exercised during fiscal years 2023, 2022, and 2021 was $83.6 million, $557.5 million, and $839.0 million, respectively.
As of January 31, 2023, unrecognized compensation expense associated with unvested stock options granted and outstanding was $122.9 million, to be recognized over a weighted-average remaining period of 2.7 years.
Fair value of each stock option grant was estimated on the date of grant using the Black-Scholes pricing model with the following assumptions:
202320222021
Weighted-AverageWeighted-AverageRange
Expected term (years)5.96.1
5.0 – 6.1
Expected volatility60.6%57.2%
60.0% – 61.1%
Risk-free interest rate3.5%1.4%
0.2% – 0.7%
Expected dividend yield0.0%0.0%0.0%
During fiscal years 2023, 2022, and 2021, our compensation committee approved modifications to allow acceleration of the service-based vesting condition of certain employee stock options upon termination. These modifications, which were considered improbable-to-probable (Type 3) modifications under ASC 718, resulted in accelerated vesting of 0.3 million, 0.2 million and 0.3 million shares of Class A common stock subject to outstanding stock options, and incremental compensation expense of $2.8 million, $2.9 million, and $4.6 million was recognized during fiscal years 2023, 2022, and 2021, respectively.
In July 2020, we repriced 4.6 million stock options which had been issued in fiscal years 2021 and 2020 after the Series D convertible preferred stock financing closing date. In conjunction with the modification of these stock options, we recognized incremental compensation expense of approximately $1.6 million. Expense related to vested shares of $0.9 million was expensed on the repricing date and the remaining amount of $0.7 million related to unvested shares was amortized over the remaining vesting period of such options.
Early Exercised Options
Certain stock option holders have the right to exercise unvested options, subject to a repurchase right held by us at the original exercise price in the event of voluntary or involuntary termination of employment of the option holders, until the options are fully vested. During fiscal year 2023, we repurchased 0.4 million unvested early exercised options in the amount of $1.5 million.
Cash proceeds associated with early exercises are recorded within accrued expenses and other current liabilities and other liabilities, non-current in our consolidated balance sheets, depending on the future vesting dates of the associated options. Such accrued amounts were not material and $2.8 million as of January 31, 2023 and 2022, respectively. Proceeds are transferred to additional paid-in capital at the time of option vesting.
Restricted Stock Units
RSUs granted under the 2021 Plan generally vest over four years. RSUs are forfeited in case of termination of employment or service before the satisfaction of service-based vesting conditions.
RSU activity during fiscal year 2023 was as follows:
RSUs (in thousands)Weighted-Average Grant
Date Fair Value Per Share
Unvested as of January 31, 2022
27,515 $35.35 
Granted30,039 $15.85 
Vested (1)(13,786)$27.21 
Forfeited(6,983)$34.25 
Unvested as of January 31, 2023
36,785 $22.48 
(1) Class A common stock has not been issued in connection with 142 vested RSUs because such RSUs were unsettled as of January 31, 2023.
The vesting date fair value of RSUs that vested during fiscal years 2023, 2022, and 2021 was $228.8 million, $1.4 billion, and none, respectively.
Prior to the IPO, we granted RSUs under the 2018 Plan that vested upon the satisfaction of both a service-based condition (generally four years) and a performance-based condition. The performance-based vesting condition was deemed satisfied on April 23, 2021, the date that our IPO was completed. At that time, we recognized $233.0 million of cumulative stock-based compensation expense for the portion of these RSUs for which the service-based vesting condition had been fully or partially satisfied.
As of January 31, 2023, unrecognized compensation expense associated with unvested RSUs was approximately $703.3 million, to be recognized over a weighted-average remaining period of 2.8 years.
During fiscal year 2023, our compensation committee approved modifications to allow accelerated vesting of approximately 0.5 million RSUs upon employee terminations. The modifications, which were considered improbable-to-probable (Type 3) modifications under ASC 718, resulted in a net reduction of $7.4 million in the fair value of the modified awards due to the decrease in our stock price between the grant and modification dates.
During fiscal year 2022, our compensation committee approved modifications to allow accelerated vesting of approximately 0.2 million RSUs upon employee terminations, resulting in the recognition of $10.9 million of incremental expense. In addition, during fiscal year 2022, our compensation committee approved adjustments to the vesting schedules of our unvested RSUs which standardize their future vesting schedules by shifting each vesting date to the first day of the calendar quarter in which that vesting date was originally scheduled to occur. These adjustments caused a slight reduction in service periods for the affected tranches and resulted in $2.2 million of expense acceleration during fiscal year 2022.
Restricted Stock Awards
In September 2020, we issued 0.1 million RSAs to a member of our board of directors at a grant date fair value of $33.22 per share, totaling $4.0 million. Such RSAs vest monthly over four years from the grant date. The unvested shares are subject to a repurchase right held by us at the original purchase price. As of January 31, 2023, total unrecognized compensation expense related to unvested RSAs was $1.6 million, to be recognized over the remaining vesting period of 1.6 years.
Employee Stock Purchase Plan Awards
The fair value of ESPP awards was estimated using the Black-Scholes option pricing model with the following weighted average assumptions:
Year Ended January 31,
Year Ended January 31,
20232022
Expected term (years)0.50.6
Expected volatility69.0%55.7%
Risk-free interest rate1.86%0.05%
Expected dividend yield0.0%0.0%
During the fiscal year ended January 31, 2023, 1.2 million shares were purchased under the ESPP at a weighted average purchase price of $13.28 per share.
As of January 31, 2023, unrecognized compensation expense related to the ESPP was approximately $2.9 million, to be recognized over a weighted-average remaining period of 0.4 years.
Stock-Based Compensation Associated with Business Acquisition
At the closing of the acquisition of Re:infer on July 29, 2022, we issued 0.4 million shares of Class A common stock (outside of the 2021 Plan) that will be released to certain employee sellers in equal installments on the first, second, and third anniversaries of the closing date, subject to employment-related clawback provisions. As of
January 31, 2023, total unrecognized compensation expense related to these shares was $6.4 million, which is to be recognized over a weighted-average remaining period of 2.5 years.
Stock-based Compensation Expense
Stock-based compensation expense is classified in the consolidated statements of operations as follows (in thousands):
Year Ended January 31,
202320222021
Cost of subscription services revenue$11,894 $12,232 $513 
Cost of professional services and other revenue11,855 29,849 1,860 
Sales and marketing154,922 237,975 16,356 
Research and development102,546 135,713 11,435 
General and administrative88,623 99,814 56,003 
Total$369,840 $515,583 $86,167 
The expense presented in the above table is net of capitalized stock-based compensation relating to software development costs of zero, $4.5 million, and $0.3 million for fiscal years 2023, 2022, and 2021, respectively.
See Note 12, Convertible Preferred Stock and Stockholders' Equity (Deficit) for further information regarding stock-based compensation expense recognized in connection with secondary transactions.