Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Oct. 31, 2016 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | INST | |
Entity Registrant Name | INSTRUCTURE INC | |
Entity Central Index Key | 1,355,754 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 28,245,236 |
Consolidated Balance Sheets (un
Consolidated Balance Sheets (unaudited) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 58,975 | $ 90,471 |
Short-term marketable securities | 24,334 | 325 |
Accounts receivable—net of allowance of $269 and $225 at September 30, 2016 and December 31, 2015, respectively | 23,087 | 9,523 |
Prepaid expenses | 4,572 | 5,010 |
Other current assets | 472 | 614 |
Total current assets | 111,440 | 105,943 |
Property and equipment, net | 13,805 | 11,732 |
Goodwill | 989 | 989 |
Intangible assets, net | 471 | 444 |
Noncurrent prepaid expenses | 622 | 749 |
Other assets | 1,027 | 1,203 |
Total assets | 128,354 | 121,060 |
Current liabilities: | ||
Accounts payable | 5,977 | 3,912 |
Accrued liabilities | 10,873 | 8,852 |
Deferred rent | 708 | 541 |
Deferred revenue | 81,563 | 49,384 |
Total current liabilities | 99,121 | 62,689 |
Deferred revenue, net of current portion | 3,222 | 2,941 |
Deferred rent, net of current portion | 8,532 | 9,078 |
Warrant liability | 35 | 331 |
Other long-term liabilities | 36 | 402 |
Total liabilities | 110,946 | 75,441 |
Stockholders’ equity: | ||
Common stock | 3 | 4 |
Treasury stock | (1) | |
Additional paid-in capital | 200,961 | 188,517 |
Accumulated other comprehensive loss | (9) | |
Accumulated deficit | (183,547) | (142,901) |
Total stockholders’ equity | 17,408 | 45,619 |
Total liabilities and stockholders’ equity | $ 128,354 | $ 121,060 |
Consolidated Balance Sheets (u3
Consolidated Balance Sheets (unaudited) (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Statement Of Financial Position [Abstract] | ||
Accounts receivable, net of allowance | $ 269 | $ 225 |
Consolidated Statements of Oper
Consolidated Statements of Operations (unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Revenue: | ||||
Subscription and support | $ 25,814 | $ 17,609 | $ 68,807 | $ 43,557 |
Professional services and other | 4,331 | 3,285 | 10,527 | 7,839 |
Total revenue | 30,145 | 20,894 | 79,334 | 51,396 |
Cost of revenue: | ||||
Subscription and support | 6,312 | 4,907 | 17,335 | 12,520 |
Professional services and other | 2,326 | 1,887 | 6,287 | 4,717 |
Total cost of revenue | 8,638 | 6,794 | 23,622 | 17,237 |
Gross profit | 21,507 | 14,100 | 55,712 | 34,159 |
Operating expenses: | ||||
Sales and marketing | 17,788 | 13,172 | 51,989 | 38,303 |
Research and development | 9,297 | 6,525 | 25,832 | 17,441 |
General and administrative | 6,689 | 4,506 | 18,428 | 18,475 |
Total operating expenses | 33,774 | 24,203 | 96,249 | 74,219 |
Loss from operations | (12,267) | (10,103) | (40,537) | (40,060) |
Other income (expense): | ||||
Interest income | 104 | 6 | 236 | 13 |
Interest expense | (31) | (28) | (54) | (72) |
Change in fair value of warrant liability | (10) | (9) | 52 | (536) |
Other expense, net | (103) | (52) | (234) | (161) |
Total other expense, net | (40) | (83) | (756) | |
Loss before income taxes | (12,307) | (10,186) | (40,537) | (40,816) |
Income tax expense | (10) | (26) | (109) | (40) |
Net loss | (12,317) | (10,212) | (40,646) | (40,856) |
Deemed dividend to investors | (632) | |||
Net loss attributable to common stockholders | $ (12,317) | $ (10,212) | $ (40,646) | $ (41,488) |
Net loss per common share attributable to common stockholders, basic and diluted | $ (0.44) | $ (1.60) | $ (1.47) | $ (6.61) |
Weighted average common shares used in computing basic and diluted net loss per common share attributable to common stockholders | 28,084 | 6,381 | 27,667 | 6,279 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss (unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net loss | $ (12,317) | $ (10,212) | $ (40,646) | $ (40,856) |
Other comprehensive gain (loss): | ||||
Unrealized loss on marketable securities | (9) | (9) | (1) | |
Comprehensive loss | $ (12,326) | $ (10,212) | $ (40,655) | $ (40,857) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Operating Activities: | ||
Net loss | $ (40,646,000) | $ (40,856,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation of property and equipment | 2,832,000 | 1,873,000 |
Amortization of intangible assets | 284,000 | 232,000 |
Amortization of deferred financing costs | 34,000 | 54,000 |
Change in fair value of warrant liability | (52,000) | 536,000 |
Stock-based compensation | 7,701,000 | 7,699,000 |
Other | 120,000 | 165,000 |
Changes in assets and liabilities: | ||
Accounts receivable, net | (13,887,000) | (3,229,000) |
Prepaid expenses and other assets | 849,000 | (3,021,000) |
Accounts payable and accrued liabilities | 4,303,000 | 3,496,000 |
Deferred revenue | 32,460,000 | 25,796,000 |
Deferred rent | (379,000) | 504,000 |
Other liabilities | (361,000) | (285,000) |
Net cash used in operating activities | (6,742,000) | (7,036,000) |
Investing Activities: | ||
Purchases of property and equipment | (4,922,000) | (4,463,000) |
Purchases of intangible assets | (311,000) | |
Proceeds from disposal of property and equipment | 23,000 | 53,000 |
Purchases of marketable securities | (24,363,000) | (1,456,000) |
Maturities of marketable securities | 325,000 | 500,000 |
Net cash used in investing activities | (29,248,000) | (5,366,000) |
Financing Activities: | ||
Proceeds from exercise of redeemable convertible preferred stock warrants | 250,000 | |
Proceeds from issuance of common stock from employee equity plans | 4,494,000 | 246,000 |
Payments of line of credit financing costs | (32,000) | |
Repayment of capital lease obligations | (207,000) | |
Net cash provided by financing activities | 4,494,000 | 257,000 |
Net decrease in cash and cash equivalents | (31,496,000) | (12,145,000) |
Cash and cash equivalents, beginning of period | 90,471,000 | 43,915,000 |
Cash and cash equivalents, end of period | 58,975,000 | 31,770,000 |
Supplemental cash flow disclosure: | ||
Cash paid for interest | 18,000 | |
Cash paid for taxes | 49,000 | 67,000 |
Non-cash investing and financing activities: | ||
Leasehold improvements | 494,000 | |
Capital expenditures incurred but not yet paid | 210,000 | 164,000 |
Issuance of common stock for exercise of common stock warrant | 244,000 | |
Deemed dividends to investors | 632,000 | |
Vesting of common stock subject to repurchase | $ 20,000 | $ 40,000 |
Description of Business and Bas
Description of Business and Basis of Presentation | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Description of Business and Basis of Presentation | 1. Description of Business and Basis of Presentation Organization Instructure, Inc. provides an innovative, cloud-based learning management platform for academic institutions and companies worldwide. We built our learning management applications, Canvas, for the education market, and Bridge, for the corporate market, to enable our customers to easily develop, deliver and manage engaging face-to-face and online learning experiences. We offer our platform through a Software-as-a-Service, or SaaS, business model. We were incorporated in the state of Delaware in September 2008. We are headquartered in Salt Lake City, Utah, and have wholly-owned subsidiaries in the United Kingdom, Australia, the Netherlands, Hong Kong, Sweden and Brazil. Basis of Presentation The accompanying unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) applicable to interim periods, under the rules and regulations of the United States Securities and Exchange Commission (“SEC”). In the opinion of management, we have prepared the accompanying unaudited financial statements on a basis substantially consistent with the audited consolidated financial statements of the Company as of and for the fiscal year ended December 31, 2015, and these financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of the interim periods presented. All intercompany balances and transactions have been eliminated in consolidation. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for any subsequent quarter or for the entire year ending December 31, 2016. The year-end balance sheet data was derived from audited financial statements, but this Form 10-Q does not include all disclosures required under GAAP. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted under the rules and regulations of the SEC. These interim financial statements should be read in conjunction with the audited consolidated financial statements and related notes contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 19, 2016. There have been no changes in the Company’s significant accounting policies from those that were disclosed in the Company’s Annual Report on Form 10-K that have had a material impact on our consolidated financial statements and related notes. Marketable Securities We hold investments in marketable securities, consisting of corporate debt securities and commercial paper. We classify our marketable securities as available-for-sale investments as we neither buy and hold securities for the purpose of selling them in the near future nor intend to hold securities to maturity. We classify our marketable securities as short term on the consolidated balance sheet for all purchased investments with contractual maturities that are less than one year as of the balance sheet date. Our marketable securities are carried at estimated fair value with any unrealized gains and losses, net of taxes, included in accumulated other comprehensive income in stockholders’ equity (deficit). Unrealized losses are charged against other income (expense), net when a decline in fair value is determined to be other-than-temporary. We have not recorded any such impairment charge in the periods presented. We determine realized gains or losses on sale or maturity of marketable securities on a specific identification method, and record such gains or losses as other income (expense), net. Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Such estimates, which we evaluate on an on-going basis, include allowances for doubtful accounts, useful lives for property and equipment and intangible assets, valuation of marketable securities, valuation allowances for net deferred income tax assets, valuation of stock-based compensation and common stock, the best estimate of selling price of deliverables included in multiple-deliverable revenue arrangements and the weighted average customer life used in the recognition of nonrefundable upfront implementation service revenue. We base our estimates on historical experience and on various other assumptions which we believe to be reasonable. Liability for Common Stock Warrants We account for freestanding warrants to purchase shares of our common stock that are not considered indexed to our own stock as warrant liabilities on our consolidated balance sheets. Under Accounting Standards Codification (“ASC”) 815, we record the liability-classified common stock warrants issued in conjunction with our credit facility at their estimated fair value because they are free standing and the number of shares exercisable under this warrant to purchase our common stock increases if the loan balance exceeds $7,500,000. At the end of each reporting period, changes in the estimated fair value of the warrants to purchase shares of common stock are recorded as a change in fair value of warrant liability in the consolidated statements of operations . A portion of the warrants were exercised in February 2016 (see Fair Value of Financial Instruments). Recent Accounting Pronouncements In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-09, Compensation – Stock Compensation (Topic 718), which simplified certain aspects of the accounting for share-based payment transactions, including income taxes, classification of awards and classification in the statement of cash flows. The standard will be effective for the Company beginning in its first quarter of 2017. We are currently evaluating the impact of adopting the new stock compensation standard on our consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases, requiring lessees to recognize a right-of-use asset and a lease liability on the balance sheet for all leases with the exception of short-term leases. For lessees, leases will continue to be classified as either operating or finance leases in the income statement. Lessor accounting is similar to the current model but updated to align with certain changes to the lessee model. Lessors will continue to classify leases as operating, direct financing or sales-type leases. The new standard must be adopted using a modified retrospective transition and requires application of the new guidance at the beginning of the earliest comparative period presented. The updated standard is effective for us beginning in the first quarter of fiscal 2019. We are currently evaluating the effect that the updated standard will have on our consolidated financial statements and related disclosures. In November 2015, the FASB In April 2015, the FASB issued ASU No. 2015-05, Intangibles – Goodwill and Other – Internal-Use Software: Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement, which provides guidance to clarify the customer’s accounting for fees paid in a cloud computing arrangement. This guidance simplifies entities’ processes as it provides criteria to determine whether cloud computing arrangements contain a software license and should be account for as internal-use-software under ASC 350-40. We elected to prospectively adopt the accounting standard in the beginning of our first quarter of fiscal 2016. Prior periods in our consolidated financial statements were not retrospectively adjusted. Starting in our first quarter of fiscal 2016, i f an arrangement included a software license, as defined by this ASU, then we accounted for the software license element of the arrangement in the intangible assets, net line item of the consolidated balance sheets rather than recording the amount in property and equipment, net. Implementation costs associated with software licenses were expensed as incurred. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which amended the existing FASB Accounting Standards Codification. This standard establishes a principle for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. The standard also provides guidance on the recognition of costs related to obtaining and fulfilling customer contracts. In July 2015, the FASB decided to defer by one year the effective dates of its new revenue recognition standard for public and nonpublic entities. As a result, this guidance will be effective for public companies for interim and annual periods beginning on or after December 15, 2017. Public entities would be permitted to adopt the standard as early as the original public entity effective date; early adoption prior to that date would not be permitted. Once effective, entities can choose to apply the standard using either a full retrospective approach or a modified retrospective approach. We have not yet selected a transition method and are currently assessing the potential impact that this standard will have on our consolidated financial statements. |
Net Loss Per Share
Net Loss Per Share | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 2. Net Loss Per Share Basic net loss per share attributable to common stockholders is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding for the period, less the weighted average unvested common stock subject to repurchase or forfeiture. Diluted net loss per share attributable to common stockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. For purposes of the diluted net loss per share calculation, options to purchase common stock, common stock warrants, and redeemable convertible preferred stock are considered to be common stock equivalents. For 2015, we applied the two-class method to calculate our basic and diluted net loss per share of common stock, as our redeemable convertible preferred stock and common stock are participating securities. The two-class method is an earnings allocation formula that treats a participating security as having rights to earnings that otherwise would have been available to common stockholders. However, the two-class method does not impact the net loss per common share attributable to common stockholders as we were in a loss position for all periods in 2015 and the redeemable convertible preferred stockholders do not participate in losses. A reconciliation of the denominator used in the calculation of basic and diluted loss per share is as follows (in thousands, except per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Numerator: Net loss attributable to common stockholders $ (12,317 ) $ (10,212 ) $ (40,646 ) $ (41,488 ) Denominator: Weighted-average common shares outstanding—basic 28,090 6,456 27,685 6,376 Less: Weighted-average common stock subject to repurchase (6 ) (75 ) (18 ) (97 ) Total weighted-average common shares outstanding—basic 28,084 6,381 27,667 6,279 Dilutive effect of share equivalents resulting from stock options, unvested restricted stock awards, common stock warrants, common stock subject to repurchase and redeemable convertible preferred stock (as converted) — — — — Weighted-average common shares outstanding-diluted 28,084 6,381 27,667 6,279 Net loss per common share, basic and diluted $ (0.44 ) $ (1.60 ) $ (1.47 ) $ (6.61 ) For all periods presented, we incurred net losses and, therefore, the effect of our outstanding stock options, unvested restricted stock, restricted stock units, common stock warrants, common stock subject to repurchase and redeemable convertible preferred stock was not included in the calculation of diluted loss per share as the effect would be anti-dilutive. The following table contains share totals with a potentially dilutive impact (in thousands): As of September 30, 2016 2015 Options to purchase common stock 3,261 3,910 Common stock warrants 17 103 Common stock subject to repurchase 4 65 Redeemable convertible preferred stock (as converted) — 14,977 Unvested restricted stock awards — — Restricted stock units 1,000 — Total 4,282 19,055 |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2016 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | 3. Property and Equipment Property and equipment consist of the following (in thousands): September 30, December 31, 2016 2015 Computer and office equipment $ 3,563 $ 2,717 Purchased software 1,119 1,074 Capitalized software development costs 5,703 3,460 Furniture and fixtures 2,396 1,890 Leasehold improvements and other 9,301 8,096 Total property and equipment 22,082 17,237 Less accumulated depreciation and amortization (8,277 ) (5,505 ) Total $ 13,805 $ 11,732 Accumulated amortization for capitalized software development costs was $1,873,000 and $987,000 at September 30, 2016 and December 31, 2015, respectively. Amortization expense for capitalized software development costs was $260,000 and $178,000 for the three months ended September 30, 2016 and 2015, respectively, and $838,000 and $443,000 for the nine months ended September 30, 2016 and 2015, respectively. Amortization expense for capitalized software development costs is recorded within cost of revenue on the consolidated statements of operations. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | 4. Goodwill and Intangible Assets Goodwill was $989,000 as of September 30, 2016 and December 31, 2015. Intangible assets consisted of the following (in thousands): Average September 30, December 31, Useful Life 2016 2015 Domain names 17 Months $ 1,268 $ 1,268 Tradenames and trademarks 7 Months 109 109 Non-compete agreements 6 Months 26 26 Software 32 Months 311 — Accumulated amortization (1,243 ) (959 ) Total $ 471 $ 444 Amortization expense for intangible assets was $98,000 and $77,000 for the three months ended September 30, 2016 and 2015, respectively, and $284,000 and $232,000 for the nine months ended September 30, 2016 and 2015, respectively. Based on the recorded intangible assets at September 30, 2016, estimated amortization expense is expected to be as follows (in thousands): Amortization Years Ending December 31, Expense Remainder of 2016 $ 105 2017 219 2018 105 2019 42 2020 — Total $ 471 |
Segment Information and Geograp
Segment Information and Geographic Data | 9 Months Ended |
Sep. 30, 2016 | |
Geographic Areas Revenues From External Customers [Abstract] | |
Segment Information and Geographic Data | 5. Segment Information and Geographic Data We operate in a single operating segment, cloud-based learning management systems. Operating segments are defined as components of an enterprise for which separate financial information is regularly evaluated by the chief operating decision makers, or CODMs, which are our chief executive officer and chief financial officer, in deciding how to allocate resources and assess performance. Our CODMs evaluate our financial information and resources and assess the performance of these resources on a consolidated basis. Since we operate in one operating segment, all required financial segment information can be found in the consolidated financial statements. Revenue by geographic region, based on the physical location of the customer, is (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 United States $ 26,973 $ 19,618 $ 72,242 $ 48,301 Foreign 3,172 1,276 7,092 3,095 Total revenue $ 30,145 $ 20,894 $ 79,334 $ 51,396 Percentage of revenue generated outside of the United States 11 % 6 % 9 % 6 % |
Marketable Securities
Marketable Securities | 9 Months Ended |
Sep. 30, 2016 | |
Investments Debt And Equity Securities [Abstract] | |
Marketable Securities | 6. Marketable Securities Our investment policy is consistent with the definition of available-for-sale securities. We do not buy and hold securities principally for the purpose of selling them in the near future nor do we intend to hold securities to maturity. Rather, our policy is focused on the preservation of capital, liquidity and return. From time to time, we may sell certain securities but the objectives are generally not to generate profits on short-term differences in price. The following tables summarize, by major security type, our assets that are measured at fair value on a recurring basis (in thousands): September 30, 2016 Amortized Gross Unrealized Gross Unrealized Estimated Fair Cost Gains Losses Value Corporate debt securities $ 24,343 $ — $ (9 ) $ 24,334 December 31, 2015 Amortized Gross Unrealized Gross Unrealized Estimated Fair Cost Gains Losses Value Corporate debt securities $ 325 $ — $ — $ 325 The aggregate fair value of investments in an unrealized loss position was $17,138,000 as of September 30, 2016. Because we do not intend to sell the investments that are in an unrealized loss position and it is not likely that we will be required to sell any investments before recovery of their amortized cost basis, we do not consider these investments with an unrealized loss to be other-than-temporarily impaired as of September 30, 2016. There were no marketable securities in an unrealized loss position as of December 31, 2015. There were no gross realized gains or losses from the sale or maturity of marketable securities during the nine months ended September 30, 2016 or the year ended December 31, 2015. During the nine months ended September 30, 2016, we recognized gross interest income on securities of $173,000. Interest income was offset by amortization expense on securities of $20,000 during the nine months ended September 30, 2016, and reported net within interest income on the consolidated statements of operations. During the year ended December 31, 2015, we recognized gross interest income on securities of $30,000. Interest income was offset by amortization expense on securities of $13,000 during 2015, and reported net within interest income on the consolidated statements of operations. The estimated fair value of investments by contractual maturity is as follows (in thousands): September 30, December 31, 2016 2015 Due within one year $ 24,334 $ 325 Due after one year and through 5 years — — Due after 5 years and through 10 years — — Due after 10 years — — Total $ 24,334 $ 325 |
Stockholders' Equity and Stock-
Stockholders' Equity and Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stockholders’ Equity and Stock-Based Compensation | 7. Stockholders’ Equity and Stock-Based Compensation Common Stock As of September 30, 2016, there were 200,000,000 shares of common stock authorized and 28,224,086 shares issued and outstanding. On April 27, 2016, the board of directors resolved to retire 1,128,472 shares that were previously held as treasury stock. Employee Equity Plans Our 2015 Equity Incentive Plan (“EIP”) serves as the successor to our 2010 Equity Incentive Plan (together with the EIP, the “Stock Plans”). Pursuant to the terms of the EIP, the share reserve increased by 1,225,795 shares in January 2016. As of September 30, 2016, 3,029,305 options to purchase remained outstanding under the 2010 Equity Incentive Plan. As of September 30, 2016, we had approximately 1,874,405 shares of common stock available for future grants under the EIP. We also have a 2015 Employee Stock Purchase Plan (“ESPP”). The ESPP allows eligible employees to purchase shares of our common stock at a discount through payroll deductions of up to 15% of their eligible compensation, subject to any plan limitations. Our board of directors approves the ESPP offerings. The offerings need not be identical, but each offering may not exceed 27 months and may specify one or more shorter purchase periods within the offering. The following two tables show stock-based compensation expense by award type and where the stock-based compensation expense was recorded in our consolidated statements of operations (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Options $ 994 $ 1,012 $ 3,130 $ 2,285 Vesting of restricted stock awards — — — 61 Restricted stock units 1,273 — 2,948 — Employee stock purchase plan 537 — 1,623 — Employee sale of securities to investors — — — 5,353 Total stock-based compensation $ 2,804 $ 1,012 $ 7,701 $ 7,699 Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Subscription and support cost of revenue $ 129 $ 49 $ 360 $ 106 Professional services and other cost of revenue 127 45 362 103 Sales and marketing 775 346 2,219 768 Research and development 1,022 344 2,742 871 General and administrative 751 228 2,018 5,851 Total stock-based compensation $ 2,804 $ 1,012 $ 7,701 $ 7,699 Stock Options The Stock Plans provide for the issuance of incentive and nonstatutory options to employees and non-employees. A summary of information related to stock option activity during the nine months ended September 30, 2016 is as follows (in thousands, except per share data): Weighted- Weighted- Average Shares Average Remaining Aggregate Underlying Exercise Life Intrinsic Options Price (in years) Value Outstanding at December 31, 2015 4,101 $ 6.58 8.3 $ 58,417 Granted 232 13.79 Exercised (632 ) 3.73 Forfeited or cancelled (440 ) 11.24 Outstanding at September 30, 2016 3,261 7.02 7.7 59,868 Vested and expected to vest—September 30, 2016 3,147 6.85 7.6 58,291 Exercisable at September 30, 2016 1,747 4.51 7.0 36,451 As of September 30, 2016 and December 31, 2015, we had $18,830,000 and $9,721,000, respectively, of unrecognized stock-based compensation costs related to non-vested awards that are expected to be recognized over a weighted average period of 3.0 years and 3.0 years, respectively. As of September 30, 2016, we had $271,000 of unrecognized stock-based compensation expense related to our ESPP that is expected to be recognized over the term of the offering period ending November 30, 2016. As of December 31, 2015, we had $919,000 of unrecognized stock-based compensation expense related to our ESPP that was recognized over the initial term of the offering period through May 31, 2016. Restricted Stock Units The Stock Plans provide for the issuance of restricted stock units (“RSUs”) to employees. A summary of information related to RSU activity during the nine months ended September 30, 2016 is as follows (in thousands, except per share amounts): RSUs Outstanding Weighted- Average Grant Date Fair Shares Value Unvested and outstanding at December 31, 2015 196 $ 18.42 Granted 1,024 17.14 Vested (118 ) 16.27 Cancelled (102 ) 17.46 Unvested and outstanding at September 30, 2016 1,000 17.46 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 8. Income Taxes Utilization of the net operating loss carryforwards and credits may be subject to substantial annual limitation due to the ownership change limitations provided by Section 382 of the Internal Revenue Code of 1986, as amended, and similar state provisions. The annual limitation may result in the expiration of net operating losses and credits before utilization. We file tax returns in the United States, the United Kingdom, Australia, the Netherlands, Hong Kong, Sweden, Brazil and various state jurisdictions. All of our tax years remain open to examination by major taxing jurisdictions to which we are subject, as carryforward attributes generated in past years may still be adjusted upon examination by the Internal Revenue Service or state and foreign tax authorities if they have or will be used in future periods. We believe that we have provided adequate reserves for our income tax uncertainties in all open tax years. We do not expect our gross unrecognized tax benefits to change significantly in the next 12 months. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 9. Fair Value of Financial Instruments The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. The fair value hierarchy prioritizes the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined into the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs that are not corroborated by market data. There were no transfers between Level 1 and Level 2 of the fair value measurement hierarchy during the nine months ended September 30, 2016 and the year ended December 31, 2015. Assets and liabilities measured at fair value on a recurring basis as of September 30, 2016, were as follows (in thousands): September 30, 2016 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 16,906 $ — $ — $ 16,906 Corporate debt securities — 24,334 — 24,334 Total Assets $ 16,906 $ 24,334 $ — $ 41,240 Liabilities: Common stock warrant liability $ — $ — $ 35 $ 35 Assets and liabilities measured at fair value on a recurring basis as of December 31, 2015, were as follows (in thousands): December 31, 2015 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 69,845 $ — $ — $ 69,845 Corporate debt securities — 325 — 325 Total assets $ 69,845 $ 325 $ — $ 70,170 Liabilities: Common stock warrant liability $ — $ — $ 331 $ 331 Fair value is a market-based measurement that should be determined based on the assumptions that market participants would use in pricing an asset or liability. The hierarchy level assigned to each security in our marketable securities portfolio and cash equivalents is based on our assessment of the transparency and reliability of the inputs used in the valuation of such instrument at the measurement date. The fair value of cash equivalents included in the Level 1 category is based on quoted prices that are readily and regularly available in an active market. The fair value of the marketable securities included in the Level 2 category is based on observable inputs, such as quoted prices for similar assets at the measurement date; quoted prices in markets that are not active; or other inputs that are observable, either directly or indirectly. These values were obtained from an independent pricing service and were evaluated using pricing models that vary by asset class and may incorporate available trade, bid and other market information and price quotes from well-established independent pricing vendors and broker-dealers. The carrying amount of our cash, receivables and payables approximates fair value because of the short-term nature of these items. The following table sets forth a summary of the changes in the estimated fair value of the warrant liability. Changes in the fair value are recognized in the change in fair value of warrant liability line item on the consolidated statements of operations. The following balance Common Stock Warrant Liability Balance at January 1, 2016 $ 331 Recognized gain (52 ) Exercise of warrant (244 ) Balance at September 30, 2016 $ 35 In November 2012, we issued a warrant to purchase 70,000 shares of common stock to our lender in connection with our line of credit. The warrant was fully exercisable and had a ten-year term with an exercise price of $0.99 per share. In April 2014, we issued our lender an additional warrant to purchase up to 33,332 shares of common stock in connection with an amendment of our line of credit at an exercise price of $4.47 per share. 16,666 of these shares were exercisable without a contingency. The additional 16,666 shares (the “contingent common stock warrant”) may become exercisable if our aggregate outstanding balance of the credit facility exceeds $7,500,000. We anticipate the probability that the contingent common stock warrant becomes exercisable is 10%. On February 2, 2016, warrants for 86,666 shares were exercised. At the lender’s request, we withheld 8,260 shares to cover the warrant exercise costs and we issued 78,406 shares. In connection with the exercise of the warrant, the warrant liability was marked to market as of the settlement date. As a result of the exercise, a portion of the warrant liability equal to $244,000 was reversed and recorded as additional paid-in capital. The remaining contingent common stock warrant to purchase 16,666 shares had an estimated common stock warrant liability balance of $35,000 at September 30, 2016. The contingent common stock warrant expires November 12, 2018. The fair values of these outstanding warrants are measured using an option pricing model and probability weighted expected return model. Inputs used to determine estimated fair value include the estimated fair value of the underlying common stock at the valuation measurement date, the estimated time to exit, risk- free interest rates, expected dividends, probability of contingent event, and estimated volatility. In addition to the above, significant inputs to the common stock warrant also includes the estimated likelihood of the exercise contingency being met. Estimated volatility is based on the volatility of a peer group. We monitor the historical volatility of peer group companies on a quarterly basis and adjust the estimated volatility when significant changes in the peer group volatilities occur. Generally, increases (decreases) in the fair value of the underlying common stock would result in a directionally similar impact to the fair value measurement. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 10. Commitments and Contingencies Litigation We are involved in legal proceedings from time to time arising in the normal course of business. Management believes that the outcome of these proceedings will not have a material impact on our financial position, results of operations, or liquidity. Lease Commitments We lease office space under non-cancelable operating leases that contain rent escalation clauses and renewal options. We recognize rent expense on a straight-line basis over the lease period and have accrued for rent expense incurred but not paid. We are also committed to pay a portion of the actual operating expenses under certain of these lease agreements. Rent expense under operating leases was $1,156,000 and $1,201,000 for the three months ended September 30, 2016 and 2015, respectively, and $3,390,000 and $2,949,000 for the nine months ended September 30, 2016 and 2015, respectively. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | 11. Subsequent Events In October 2016, we granted 90,237 RSUs. Total unrecognized stock-based compensation costs, net of estimated forfeitures, was $2,008,000, which is expected to be recognized over a weighted-average period of approximately 3.9 years. |
Description of Business and B18
Description of Business and Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) applicable to interim periods, under the rules and regulations of the United States Securities and Exchange Commission (“SEC”). In the opinion of management, we have prepared the accompanying unaudited financial statements on a basis substantially consistent with the audited consolidated financial statements of the Company as of and for the fiscal year ended December 31, 2015, and these financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of the interim periods presented. All intercompany balances and transactions have been eliminated in consolidation. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for any subsequent quarter or for the entire year ending December 31, 2016. The year-end balance sheet data was derived from audited financial statements, but this Form 10-Q does not include all disclosures required under GAAP. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been omitted under the rules and regulations of the SEC. These interim financial statements should be read in conjunction with the audited consolidated financial statements and related notes contained in the Company’s Annual Report on Form 10-K filed with the SEC on February 19, 2016. There have been no changes in the Company’s significant accounting policies from those that were disclosed in the Company’s Annual Report on Form 10-K that have had a material impact on our consolidated financial statements and related notes. |
Marketable Securities | Marketable Securities We hold investments in marketable securities, consisting of corporate debt securities and commercial paper. We classify our marketable securities as available-for-sale investments as we neither buy and hold securities for the purpose of selling them in the near future nor intend to hold securities to maturity. We classify our marketable securities as short term on the consolidated balance sheet for all purchased investments with contractual maturities that are less than one year as of the balance sheet date. Our marketable securities are carried at estimated fair value with any unrealized gains and losses, net of taxes, included in accumulated other comprehensive income in stockholders’ equity (deficit). Unrealized losses are charged against other income (expense), net when a decline in fair value is determined to be other-than-temporary. We have not recorded any such impairment charge in the periods presented. We determine realized gains or losses on sale or maturity of marketable securities on a specific identification method, and record such gains or losses as other income (expense), net. |
Use of Estimates | Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts and disclosures. Accordingly, actual results could differ from those estimates. Such estimates, which we evaluate on an on-going basis, include allowances for doubtful accounts, useful lives for property and equipment and intangible assets, valuation of marketable securities, valuation allowances for net deferred income tax assets, valuation of stock-based compensation and common stock, the best estimate of selling price of deliverables included in multiple-deliverable revenue arrangements and the weighted average customer life used in the recognition of nonrefundable upfront implementation service revenue. We base our estimates on historical experience and on various other assumptions which we believe to be reasonable. |
Liability for Common Stock Warrants | Liability for Common Stock Warrants We account for freestanding warrants to purchase shares of our common stock that are not considered indexed to our own stock as warrant liabilities on our consolidated balance sheets. Under Accounting Standards Codification (“ASC”) 815, we record the liability-classified common stock warrants issued in conjunction with our credit facility at their estimated fair value because they are free standing and the number of shares exercisable under this warrant to purchase our common stock increases if the loan balance exceeds $7,500,000. At the end of each reporting period, changes in the estimated fair value of the warrants to purchase shares of common stock are recorded as a change in fair value of warrant liability in the consolidated statements of operations . A portion of the warrants were exercised in February 2016 (see Fair Value of Financial Instruments). |
Recent Accounting Pronouncement | Recent Accounting Pronouncements In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-09, Compensation – Stock Compensation (Topic 718), which simplified certain aspects of the accounting for share-based payment transactions, including income taxes, classification of awards and classification in the statement of cash flows. The standard will be effective for the Company beginning in its first quarter of 2017. We are currently evaluating the impact of adopting the new stock compensation standard on our consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases, requiring lessees to recognize a right-of-use asset and a lease liability on the balance sheet for all leases with the exception of short-term leases. For lessees, leases will continue to be classified as either operating or finance leases in the income statement. Lessor accounting is similar to the current model but updated to align with certain changes to the lessee model. Lessors will continue to classify leases as operating, direct financing or sales-type leases. The new standard must be adopted using a modified retrospective transition and requires application of the new guidance at the beginning of the earliest comparative period presented. The updated standard is effective for us beginning in the first quarter of fiscal 2019. We are currently evaluating the effect that the updated standard will have on our consolidated financial statements and related disclosures. In November 2015, the FASB In April 2015, the FASB issued ASU No. 2015-05, Intangibles – Goodwill and Other – Internal-Use Software: Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement, which provides guidance to clarify the customer’s accounting for fees paid in a cloud computing arrangement. This guidance simplifies entities’ processes as it provides criteria to determine whether cloud computing arrangements contain a software license and should be account for as internal-use-software under ASC 350-40. We elected to prospectively adopt the accounting standard in the beginning of our first quarter of fiscal 2016. Prior periods in our consolidated financial statements were not retrospectively adjusted. Starting in our first quarter of fiscal 2016, i f an arrangement included a software license, as defined by this ASU, then we accounted for the software license element of the arrangement in the intangible assets, net line item of the consolidated balance sheets rather than recording the amount in property and equipment, net. Implementation costs associated with software licenses were expensed as incurred. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which amended the existing FASB Accounting Standards Codification. This standard establishes a principle for recognizing revenue upon the transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. The standard also provides guidance on the recognition of costs related to obtaining and fulfilling customer contracts. In July 2015, the FASB decided to defer by one year the effective dates of its new revenue recognition standard for public and nonpublic entities. As a result, this guidance will be effective for public companies for interim and annual periods beginning on or after December 15, 2017. Public entities would be permitted to adopt the standard as early as the original public entity effective date; early adoption prior to that date would not be permitted. Once effective, entities can choose to apply the standard using either a full retrospective approach or a modified retrospective approach. We have not yet selected a transition method and are currently assessing the potential impact that this standard will have on our consolidated financial statements. |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Summary of Reconciliation of the Denominator Used in the Calculation of Basic and Diluted Loss Per Share | A reconciliation of the denominator used in the calculation of basic and diluted loss per share is as follows (in thousands, except per share amounts): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Numerator: Net loss attributable to common stockholders $ (12,317 ) $ (10,212 ) $ (40,646 ) $ (41,488 ) Denominator: Weighted-average common shares outstanding—basic 28,090 6,456 27,685 6,376 Less: Weighted-average common stock subject to repurchase (6 ) (75 ) (18 ) (97 ) Total weighted-average common shares outstanding—basic 28,084 6,381 27,667 6,279 Dilutive effect of share equivalents resulting from stock options, unvested restricted stock awards, common stock warrants, common stock subject to repurchase and redeemable convertible preferred stock (as converted) — — — — Weighted-average common shares outstanding-diluted 28,084 6,381 27,667 6,279 Net loss per common share, basic and diluted $ (0.44 ) $ (1.60 ) $ (1.47 ) $ (6.61 ) |
Summary of Shares Excluded from Calculation of Diluted Loss Per Share with a Potential Dilutive Impact | The following table contains share totals with a potentially dilutive impact (in thousands): As of September 30, 2016 2015 Options to purchase common stock 3,261 3,910 Common stock warrants 17 103 Common stock subject to repurchase 4 65 Redeemable convertible preferred stock (as converted) — 14,977 Unvested restricted stock awards — — Restricted stock units 1,000 — Total 4,282 19,055 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Property Plant And Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consist of the following (in thousands): September 30, December 31, 2016 2015 Computer and office equipment $ 3,563 $ 2,717 Purchased software 1,119 1,074 Capitalized software development costs 5,703 3,460 Furniture and fixtures 2,396 1,890 Leasehold improvements and other 9,301 8,096 Total property and equipment 22,082 17,237 Less accumulated depreciation and amortization (8,277 ) (5,505 ) Total $ 13,805 $ 11,732 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | Intangible assets consisted of the following (in thousands): Average September 30, December 31, Useful Life 2016 2015 Domain names 17 Months $ 1,268 $ 1,268 Tradenames and trademarks 7 Months 109 109 Non-compete agreements 6 Months 26 26 Software 32 Months 311 — Accumulated amortization (1,243 ) (959 ) Total $ 471 $ 444 |
Estimated Amortization Expense | Based on the recorded intangible assets at September 30, 2016, estimated amortization expense is expected to be as follows (in thousands): Amortization Years Ending December 31, Expense Remainder of 2016 $ 105 2017 219 2018 105 2019 42 2020 — Total $ 471 |
Segment Information and Geogr22
Segment Information and Geographic Data (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Geographic Areas Revenues From External Customers [Abstract] | |
Schedule of Revenue by Geographic Region | Revenue by geographic region, based on the physical location of the customer, is (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 United States $ 26,973 $ 19,618 $ 72,242 $ 48,301 Foreign 3,172 1,276 7,092 3,095 Total revenue $ 30,145 $ 20,894 $ 79,334 $ 51,396 Percentage of revenue generated outside of the United States 11 % 6 % 9 % 6 % |
Marketable Securities (Tables)
Marketable Securities (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Investments Debt And Equity Securities [Abstract] | |
Summary of Major Security Type Assets Measured at Fair Value on Recurring Basis | The following tables summarize, by major security type, our assets that are measured at fair value on a recurring basis (in thousands): September 30, 2016 Amortized Gross Unrealized Gross Unrealized Estimated Fair Cost Gains Losses Value Corporate debt securities $ 24,343 $ — $ (9 ) $ 24,334 December 31, 2015 Amortized Gross Unrealized Gross Unrealized Estimated Fair Cost Gains Losses Value Corporate debt securities $ 325 $ — $ — $ 325 |
Schedule of Estimated Fair Value of Investments by Contractual Maturity | The estimated fair value of investments by contractual maturity is as follows (in thousands): September 30, December 31, 2016 2015 Due within one year $ 24,334 $ 325 Due after one year and through 5 years — — Due after 5 years and through 10 years — — Due after 10 years — — Total $ 24,334 $ 325 |
Stockholders' Equity and Stoc24
Stockholders' Equity and Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Stock-Based Compensation Expense by Award Type | stock-based compensation expense by award type Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Options $ 994 $ 1,012 $ 3,130 $ 2,285 Vesting of restricted stock awards — — — 61 Restricted stock units 1,273 — 2,948 — Employee stock purchase plan 537 — 1,623 — Employee sale of securities to investors — — — 5,353 Total stock-based compensation $ 2,804 $ 1,012 $ 7,701 $ 7,699 |
Summary of Stock-Based Compensation Expense Recorded in Consolidated Statement of Operations | the stock-based compensation expense was recorded in our consolidated statements of operations (in thousands) Three Months Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 Subscription and support cost of revenue $ 129 $ 49 $ 360 $ 106 Professional services and other cost of revenue 127 45 362 103 Sales and marketing 775 346 2,219 768 Research and development 1,022 344 2,742 871 General and administrative 751 228 2,018 5,851 Total stock-based compensation $ 2,804 $ 1,012 $ 7,701 $ 7,699 |
Summary of Stock Option Activity | A summary of information related to stock option activity during the nine months ended September 30, 2016 is as follows (in thousands, except per share data): Weighted- Weighted- Average Shares Average Remaining Aggregate Underlying Exercise Life Intrinsic Options Price (in years) Value Outstanding at December 31, 2015 4,101 $ 6.58 8.3 $ 58,417 Granted 232 13.79 Exercised (632 ) 3.73 Forfeited or cancelled (440 ) 11.24 Outstanding at September 30, 2016 3,261 7.02 7.7 59,868 Vested and expected to vest—September 30, 2016 3,147 6.85 7.6 58,291 Exercisable at September 30, 2016 1,747 4.51 7.0 36,451 |
Summary of Restricted Stock Units Activity | A summary of information related to RSU activity during the nine months ended September 30, 2016 is as follows (in thousands, except per share amounts): RSUs Outstanding Weighted- Average Grant Date Fair Shares Value Unvested and outstanding at December 31, 2015 196 $ 18.42 Granted 1,024 17.14 Vested (118 ) 16.27 Cancelled (102 ) 17.46 Unvested and outstanding at September 30, 2016 1,000 17.46 |
Fair Value of Financial Instr25
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Summary of Assets and Liabilities Measured at Fair Value on Recurring Basis | There were no transfers between Level 1 and Level 2 of the fair value measurement hierarchy during the nine months ended September 30, 2016 and the year ended December 31, 2015. Assets and liabilities measured at fair value on a recurring basis as of September 30, 2016, were as follows (in thousands): September 30, 2016 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 16,906 $ — $ — $ 16,906 Corporate debt securities — 24,334 — 24,334 Total Assets $ 16,906 $ 24,334 $ — $ 41,240 Liabilities: Common stock warrant liability $ — $ — $ 35 $ 35 Assets and liabilities measured at fair value on a recurring basis as of December 31, 2015, were as follows (in thousands): December 31, 2015 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 69,845 $ — $ — $ 69,845 Corporate debt securities — 325 — 325 Total assets $ 69,845 $ 325 $ — $ 70,170 Liabilities: Common stock warrant liability $ — $ — $ 331 $ 331 |
Summary of Changes in the Estimated Fair Value of Warrant Liabilities | The following table sets forth a summary of the changes in the estimated fair value of the warrant liability. Changes in the fair value are recognized in the change in fair value of warrant liability line item on the consolidated statements of operations. The following balance Common Stock Warrant Liability Balance at January 1, 2016 $ 331 Recognized gain (52 ) Exercise of warrant (244 ) Balance at September 30, 2016 $ 35 |
Description of Business and B26
Description of Business and Basis of Presentation - Additional Information (Details) - USD ($) | 1 Months Ended | 9 Months Ended |
Apr. 30, 2014 | Sep. 30, 2016 | |
Accounting Policies [Abstract] | ||
Entity incorporation date | 2008-09 | |
Minimum loan balance to issuance of common stock | $ 7,500,000 | $ 7,500,000 |
Net Loss Per Share - Summary of
Net Loss Per Share - Summary of Reconciliation of the Denominator Used in the Calculation of Basic and Diluted Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Numerator: | ||||
Net loss attributable to common stockholders | $ (12,317) | $ (10,212) | $ (40,646) | $ (41,488) |
Denominator: | ||||
Weighted-average common shares outstanding—basic | 28,090 | 6,456 | 27,685 | 6,376 |
Less: Weighted-average common stock subject to repurchase | (6) | (75) | (18) | (97) |
Total weighted-average common shares outstanding—basic | 28,084 | 6,381 | 27,667 | 6,279 |
Weighted-average common shares outstanding-diluted | 28,084 | 6,381 | 27,667 | 6,279 |
Net loss per common share, basic and diluted | $ (0.44) | $ (1.60) | $ (1.47) | $ (6.61) |
Net Loss Per Share - Summary 28
Net Loss Per Share - Summary of Shares Excluded from Calculation of Diluted Loss Per Share with a Potential Dilutive Impact (Details) - shares shares in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Shares excluded from calculation of diluted loss per share with a potential dilutive impact | 4,282 | 19,055 |
Options to Purchase Common Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Shares excluded from calculation of diluted loss per share with a potential dilutive impact | 3,261 | 3,910 |
Common Stock Warrants | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Shares excluded from calculation of diluted loss per share with a potential dilutive impact | 17 | 103 |
Common Stock Subject to Repurchase | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Shares excluded from calculation of diluted loss per share with a potential dilutive impact | 4 | 65 |
Restricted Stock Units | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Shares excluded from calculation of diluted loss per share with a potential dilutive impact | 1,000 | |
Redeemable Convertible Preferred Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Shares excluded from calculation of diluted loss per share with a potential dilutive impact | 14,977 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 22,082 | $ 17,237 |
Less accumulated depreciation and amortization | (8,277) | (5,505) |
Total | 13,805 | 11,732 |
Computer and Office Equipment | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 3,563 | 2,717 |
Purchased Software | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 1,119 | 1,074 |
Capitalized Software Development Costs | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 5,703 | 3,460 |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 2,396 | 1,890 |
Leasehold Improvements and Other | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 9,301 | $ 8,096 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Property Plant And Equipment [Abstract] | |||||
Accumulated amortization for capitalized software development costs | $ 1,873,000 | $ 1,873,000 | $ 987,000 | ||
Amortization expense for capitalized software development costs | $ 260,000 | $ 178,000 | $ 838,000 | $ 443,000 |
Goodwill and Intangible Asset31
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |||||
Goodwill | $ 989,000 | $ 989,000 | $ 989,000 | ||
Amortization of intangible assets | $ 98,000 | $ 77,000 | $ 284,000 | $ 232,000 |
Goodwill and Intangible Asset32
Goodwill and Intangible Assets - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2015 | |
Finite Lived Intangible Assets [Line Items] | ||
Accumulated amortization | $ (1,243) | $ (959) |
Total | $ 471 | 444 |
Domain names | ||
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, Average Remaining Useful Life | 17 months | |
Intangible assets, gross | $ 1,268 | 1,268 |
Tradenames and trademarks | ||
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, Average Remaining Useful Life | 7 months | |
Intangible assets, gross | $ 109 | 109 |
Non-compete agreements | ||
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, Average Remaining Useful Life | 6 months | |
Intangible assets, gross | $ 26 | $ 26 |
Software | ||
Finite Lived Intangible Assets [Line Items] | ||
Intangible assets, Average Remaining Useful Life | 32 months | |
Intangible assets, gross | $ 311 |
Goodwill and Intangible Asset33
Goodwill and Intangible Assets - Estimated Amortization Expense (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Finite Lived Intangible Assets Net [Abstract] | ||
Remainder of 2016 | $ 105 | |
2,017 | 219 | |
2,018 | 105 | |
2,019 | 42 | |
Total | $ 471 | $ 444 |
Segment Information and Geogr34
Segment Information and Geographic Data - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2016Segment | |
Geographic Areas Revenues From External Customers [Abstract] | |
Number of operating segment | 1 |
Segment Information and Geogr35
Segment Information and Geographic Data - Schedule of Revenue by Geographic Region (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Revenues From External Customers And Long Lived Assets [Line Items] | ||||
Total revenue | $ 30,145 | $ 20,894 | $ 79,334 | $ 51,396 |
United States | ||||
Revenues From External Customers And Long Lived Assets [Line Items] | ||||
Total revenue | 26,973 | 19,618 | 72,242 | 48,301 |
Foreign | ||||
Revenues From External Customers And Long Lived Assets [Line Items] | ||||
Total revenue | $ 3,172 | $ 1,276 | $ 7,092 | $ 3,095 |
Sales Revenue | Customer Concentration Risk | Non Us | ||||
Revenues From External Customers And Long Lived Assets [Line Items] | ||||
Percentage of revenue generated outside of the United States | 11.00% | 6.00% | 9.00% | 6.00% |
Marketable Securities - Summary
Marketable Securities - Summary of Major Security Type Assets Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Schedule Of Available For Sale Securities [Line Items] | ||
Estimated Fair Value | $ 24,334 | $ 325 |
Corporate Debt Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Amortized Cost | 24,343 | 325 |
Gross Unrealized Losses | (9) | |
Estimated Fair Value | $ 24,334 | $ 325 |
Marketable Securities - Additio
Marketable Securities - Additional Information (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Investments Debt And Equity Securities [Abstract] | ||
Unrealized loss position on aggregate fair value of investments | $ 17,138,000 | |
Unrealized loss on marketable securities | $ 0 | |
Gross realized gains or losses from sale or maturity of marketable securities | 0 | 0 |
Gross interest income on securities | 173,000 | 30,000 |
Amortization expense on securities | $ 20,000 | $ 13,000 |
Marketable Securities - Schedul
Marketable Securities - Schedule of Estimated Fair Value of Investments by Contractual Maturity (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Investments Debt And Equity Securities [Abstract] | ||
Due within one year | $ 24,334 | $ 325 |
Total | $ 24,334 | $ 325 |
Stockholders' Equity and Stoc39
Stockholders' Equity and Stock-Based Compensation - Additional Information (Details) - USD ($) | Apr. 27, 2016 | May 31, 2016 | Jan. 31, 2016 | Sep. 30, 2016 | Dec. 31, 2015 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Common stock, authorized | 200,000,000 | ||||
Common stock, Issued | 28,224,086 | ||||
Common stock, outstanding | 28,224,086 | ||||
Dividends paid or declared | $ 0 | ||||
Common stock voting rights | Each share of common stock has the right to one vote on all matters submitted to a vote of stockholders. | ||||
Retirement of treasury stock, Shares | 1,128,472 | ||||
Options outstanding | 3,261,000 | 4,101,000 | |||
Unrecognized stock-based compensation costs related to non-vested awards | $ 18,830,000 | $ 9,721,000 | |||
Weighted-average period for unrecognized compensation cost expected to be recognized | 3 years | 3 years | |||
2015 Equity Incentive Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Increase in share reserve under the plan | 1,225,795 | ||||
Shares available for future grants | 1,874,405 | ||||
2010 Equity Incentive Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Options outstanding | 3,029,305 | ||||
2015 ESPP | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Increase in share reserve under the plan | 272,399 | ||||
Shares available for future grants | 449,263 | ||||
Initial offering expiration period | 27 months | ||||
Percentage of discount through payroll deductions to eligible employees to purchase common stock | 15.00% | ||||
Common stock issued under ESPP | 156,469 | ||||
Stock price per share under ESPP | $ 13.60 | ||||
Cash proceeds from issuance of common stock under ESPP | $ 2,128,000 | ||||
Unrecognized stock-based compensation costs | $ 271,000 | $ 919,000 | |||
Weighted average date for unrecognized compensation cost to expected to be recognized | Nov. 30, 2016 | May 31, 2016 |
Stockholders' Equity and Stoc40
Stockholders' Equity and Stock-Based Compensation - Summary of Stock-Based Compensation Expense by Award Type (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation | $ 2,804 | $ 1,012 | $ 7,701 | $ 7,699 |
Options | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation | 994 | $ 1,012 | 3,130 | 2,285 |
Unvested Restricted Stock Awards | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation | 61 | |||
Restricted Stock Units | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation | 1,273 | 2,948 | ||
Employee Stock Purchase Plan | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation | $ 537 | $ 1,623 | ||
Employee Sale of Securities to Investors | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Total stock-based compensation | $ 5,353 |
Stockholders' Equity and Stoc41
Stockholders' Equity and Stock-Based Compensation - Summary of Stock-Based Compensation Expense Recorded in Consolidated Statement of Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | $ 2,804 | $ 1,012 | $ 7,701 | $ 7,699 |
Subscription and Support Cost of Revenue | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | 129 | 49 | 360 | 106 |
Professional Services and Other Cost of Revenue | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | 127 | 45 | 362 | 103 |
Sales and Marketing | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | 775 | 346 | 2,219 | 768 |
Research and Development | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | 1,022 | 344 | 2,742 | 871 |
General and Administrative | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation | $ 751 | $ 228 | $ 2,018 | $ 5,851 |
Stockholders' Equity and Stoc42
Stockholders' Equity and Stock-Based Compensation - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2016 | Dec. 31, 2015 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Shares Underlying Options, Outstanding, Beginning Balance | 4,101 | |
Shares Underlying Options, Granted | 232 | |
Shares Underlying Options, Exercised | (632) | |
Shares Underlying Options, Forfeited or Cancelled | (440) | |
Shares Underlying Options, Outstanding, Ending Balance | 3,261 | 4,101 |
Shares Underlying Options, Vested and Expected to Vest | 3,147 | |
Shares Underlying Options, Exercisable | 1,747 | |
Weighted-Average Exercise Price, Outstanding, Beginning Balance | $ 6.58 | |
Weighted-Average Exercise Price, Granted | 13.79 | |
Weighted-Average Exercise Price, Exercised | 3.73 | |
Weighted-Average Exercise Price, Forfeited or Cancelled | 11.24 | |
Weighted-Average Exercise Price, Outstanding, Ending Balance | 7.02 | $ 6.58 |
Weighted-Average Exercise Price, Vested and Expected to Vest | 6.85 | |
Weighted-Average Exercise Price, Exercisable | $ 4.51 | |
Weighted-Average Remaining Life, Outstanding | 7 years 8 months 12 days | 8 years 3 months 18 days |
Weighted-Average Remaining Life, Vested and Expected to Vest | 7 years 7 months 6 days | |
Weighted-Average Remaining Life, Exercisable | 7 years | |
Aggregate Intrinsic Value, Outstanding | $ 59,868 | $ 58,417 |
Aggregate Intrinsic Value, Vested and Expected to Vest | 58,291 | |
Aggregate Intrinsic Value, Exercisable | $ 36,451 |
Stockholders' Equity and Stoc43
Stockholders' Equity and Stock-Based Compensation - Summary of Restricted Stock Units Activity (Details) - Restricted Stock Units shares in Thousands | 9 Months Ended |
Sep. 30, 2016$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Shares, Unvested and Outstanding, Beginning Balance | shares | 196 |
Shares, Granted | shares | 1,024 |
Shares, Vested | shares | (118) |
Shares, Cancelled | shares | (102) |
Shares, Unvested and Outstanding, Ending Balance | shares | 1,000 |
Weighted-Average Grant Date Fair Value Per Share, Unvested and Outstanding, Beginning Balance | $ / shares | $ 18.42 |
Weighted-Average Grant Date Fair Value Per Share, Granted | $ / shares | 17.14 |
Weighted-Average Grant Date Fair Value Per Share, Vested | $ / shares | 16.27 |
Weighted-Average Grant Date Fair Value Per Share, Cancelled | $ / shares | 17.46 |
Weighted-Average Grant Date Fair Value Per Share, Unvested and Outstanding, Ending Balance | $ / shares | $ 17.46 |
Fair Value of Financial Instr44
Fair Value of Financial Instruments - Summary of Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2016 | Dec. 31, 2015 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | $ 41,240 | $ 70,170 |
Common stock warrant liability | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total liabilities | 35 | 331 |
Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | 16,906 | 69,845 |
Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | 24,334 | 325 |
Level 3 | Common stock warrant liability | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total liabilities | 35 | 331 |
Money market funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | 16,906 | 69,845 |
Money market funds | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | 16,906 | 69,845 |
Corporate Debt Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | 24,334 | 325 |
Corporate Debt Securities | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total assets | $ 24,334 | $ 325 |
Fair Value of Financial Instr45
Fair Value of Financial Instruments - Summary of Changes in the Estimated Fair Value of Warrant Liabilities (Details) - Common Stock Warrant Liability $ in Thousands | 9 Months Ended |
Sep. 30, 2016USD ($) | |
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |
Beginning Balance | $ 331 |
Recognized gain | (52) |
Exercise of warrant | (244) |
Ending Balance | $ 35 |
Fair Value of Financial Instr46
Fair Value of Financial Instruments - Additional Information (Details) - USD ($) | Feb. 02, 2016 | Apr. 30, 2014 | Nov. 30, 2012 | Sep. 30, 2016 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Warrants issued to purchase common stock | 78,406 | 33,332 | 70,000 | |
Warrant exercise term | 10 years | |||
Warrant exercise price | $ 4.47 | $ 0.99 | ||
Aggregate outstanding balance of credit facility | $ 7,500,000 | $ 7,500,000 | ||
Warrants exercised | 86,666 | |||
Shares withheld to cover warrant exercise costs | 8,260 | |||
Adjustments to additional paid in capital for warrant liability reversed | $ 244,000 | |||
Remaining contingent common stock warrant liability | 16,666 | |||
Estimated common stock warrant liability | $ 35,000 | |||
Common Stock Warrant Without Contingency | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Warrants issued to purchase common stock | 16,666 | |||
Contingent Common Stock Warrant | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Warrants issued to purchase common stock | 16,666 | |||
Estimated exercisable percentage | 10.00% | |||
Warrant expiration date | Nov. 12, 2018 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Commitments And Contingencies Disclosure [Abstract] | ||||
Rent expense under operating leases | $ 1,156,000 | $ 1,201,000 | $ 3,390,000 | $ 2,949,000 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - USD ($) | 1 Months Ended | 9 Months Ended | 12 Months Ended |
Oct. 31, 2016 | Sep. 30, 2016 | Dec. 31, 2015 | |
Subsequent Event [Line Items] | |||
Weighted-average period for unrecognized compensation cost expected to be recognized | 3 years | 3 years | |
Restricted Stock Units | |||
Subsequent Event [Line Items] | |||
Shares granted | 1,024,000 | ||
Restricted Stock Units | Subsequent Event | |||
Subsequent Event [Line Items] | |||
Shares granted | 90,237 | ||
Net of estimated forfeitures for unrecognized non vested stock based compensation | $ 2,008,000 | ||
Weighted-average period for unrecognized compensation cost expected to be recognized | 3 years 10 months 24 days |