Etsy (ETSY) 10-Q 5 Nov 15 2015 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2015	Oct. 15, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	ETSY INC
Entity Central Index Key	1,370,637
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Document Type	10-Q
Document Period End Date	Sep. 30, 2015
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q3
Amendment Flag	false
Entity Common Stock, Shares Outstanding		112,101,830

Consolidated Balance Sheets (Un

Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$ 266,283	$ 69,659
Short-term investments	20,474	19,184
Accounts receivable, net of allowance for doubtful accounts of $1,841 and $2,402 as of December 31, 2014 and September 30, 2015, respectively	15,976	15,404
Prepaid and other current assets	8,773	12,241
Deferred tax assets—current	3,134	2,932
Deferred tax charge—current	17,605	0
Funds receivable and seller accounts	17,069	10,573
Total current assets	349,314	129,993
Restricted cash	5,341	5,341
Property and equipment, net	94,655	75,538
Goodwill	28,366	30,831
Intangible assets, net	3,483	5,410
Deferred tax charge—net of current portion	55,711	0
Other assets	1,751	2,022
Total assets	538,621	249,135
Current liabilities:
Accounts payable	3,200	8,231
Accrued expenses	32,861	12,852
Capital lease obligations—current	4,431	1,755
Funds payable and amounts due to sellers	17,069	10,573
Deferred revenue	4,128	3,452
Other current liabilities	7,925	4,590
Total current liabilities	69,614	41,453
Capital lease obligations—net of current portion	6,483	3,148
Warrant liability	0	1,920
Deferred tax liabilities	66,227	3,081
Facility financing obligation	51,804	50,320
Other liabilities	21,699	1,913
Total liabilities	$ 215,827	$ 101,835
Commitments and contingencies
Convertible preferred stock:
Carrying value	$ 0	$ 80,212
Stockholders’ equity:
Common stock ($0.001 par value, 120,000,000 and 1,400,000,000 shares authorized as of December 31, 2014 and September 30, 2015, respectively; 44,180,939 and 111,992,315 shares issued and outstanding as of December 31, 2014, and September 30, 2015, respectively)	112	44
Preferred Stock ($0.001 par value, 25,000,000 shares authorized as of September 30, 2015)	0	0
Additional paid-in capital	398,639	103,355
Accumulated deficit	(82,208)	(32,377)
Accumulated other comprehensive (loss) income	6,251	(3,934)
Total stockholders’ equity	322,794	67,088
Total liabilities, convertible preferred stock and stockholders’ equity	538,621	249,135
Series A Preferred Stock
Convertible preferred stock:
Carrying value	0	808
Series B Preferred Stock
Convertible preferred stock:
Carrying value	0	865
Series C Preferred Stock
Convertible preferred stock:
Carrying value	0	3,361
Series D Preferred Stock
Convertible preferred stock:
Carrying value	0	27,870
Series E Preferred Stock
Convertible preferred stock:
Carrying value	0	6,201
Series 1 Preferred Stock
Convertible preferred stock:
Carrying value	0	1,322
Series F Preferred Stock
Convertible preferred stock:
Carrying value	$ 0	$ 39,785

Consolidated Balance Sheets (U3

Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Allowance for doubtful accounts	$ 2,402	$ 1,841
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	1,400,000,000	120,000,000
Common stock, shares issued	111,992,315	44,180,939
Common stock, shares outstanding	111,992,315	44,180,939
Preferred stock, par value	$ 0.001
Preferred stock, shares authorized	25,000,000
Series A Preferred Stock
Temporary equity, par value		$ 0.001
Temporary equity, shares authorized		2,363,786
Temporary equity, shares issued	0	2,363,786
Temporary equity, shares outstanding	0	2,363,786
Temporary equity, aggregate liquidation preference		$ 808
Series B Preferred Stock
Temporary equity, par value		$ 0.001
Temporary equity, shares authorized		1,128,431
Temporary equity, shares issued	0	1,128,425
Temporary equity, shares outstanding	0	1,128,425
Temporary equity, aggregate liquidation preference		$ 903
Series C Preferred Stock
Temporary equity, par value		$ 0.001
Temporary equity, shares authorized		1,234,084
Temporary equity, shares issued	0	1,222,282
Temporary equity, shares outstanding	0	1,222,282
Temporary equity, aggregate liquidation preference		$ 3,263
Series D Preferred Stock
Temporary equity, par value		$ 0.001
Temporary equity, shares authorized		4,240,120
Temporary equity, shares issued	0	4,215,610
Temporary equity, shares outstanding	0	4,215,610
Temporary equity, aggregate liquidation preference		$ 27,949
Series E Preferred Stock
Temporary equity, par value		$ 0.001
Temporary equity, shares authorized		401,450
Temporary equity, shares issued	0	396,727
Temporary equity, shares outstanding	0	396,727
Temporary equity, aggregate liquidation preference		$ 6,300
Series 1 Preferred Stock
Temporary equity, par value		$ 0.001
Temporary equity, shares authorized		203,399
Temporary equity, shares issued	0	203,399
Temporary equity, shares outstanding	0	203,399
Temporary equity, aggregate liquidation preference		$ 1,312
Series F Preferred Stock
Temporary equity, par value		$ 0.001
Temporary equity, shares authorized		11,594,203
Temporary equity, shares issued	0	11,594,203
Temporary equity, shares outstanding	0	11,594,203
Temporary equity, aggregate liquidation preference		$ 40,000

Consolidated Statements of Oper

Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Income Statement [Abstract]
Revenue	$ 65,696	$ 47,634	$ 185,604	$ 130,679
Cost of revenue	24,165	18,115	66,783	50,854
Gross profit	41,531	29,519	118,821	79,825
Operating expenses:
Marketing	16,542	8,808	44,295	25,042
Product development	11,406	10,077	31,487	26,911
General and administrative	15,250	13,686	53,339	34,299
Total operating expenses	43,198	32,571	129,121	86,252
Loss from operations	(1,667)	(3,052)	(10,300)	(6,427)
Other income (expense):
Interest expense and amortization of deferred financing costs	(512)	(177)	(1,056)	(355)
Interest and dividend income	59	12	117	30
Net unrealized gain (loss) on warrant and other liabilities	3	35	(3,136)	(239)
Foreign exchange loss	(679)	(1,014)	(15,727)	(1,014)
Total other expense	(1,129)	(1,144)	(19,802)	(1,578)
Loss before income taxes	(2,796)	(4,196)	(30,102)	(8,005)
Provision for income taxes	(4,095)	(2,075)	(19,729)	(1,880)
Net loss	$ (6,891)	$ (6,271)	$ (49,831)	$ (9,885)
Net loss per share attributable to common stockholders:
Basic and diluted (in dollars per share)	$ (0.06)	$ (0.15)	$ (0.59)	$ (0.25)
Weighted average common shares outstanding:
Basic and diluted (shares)	111,329,917	43,015,151	84,195,227	39,258,879

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Loss (Unaudited) Statement - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Statement of Comprehensive Income [Abstract]
Net loss	$ (6,891)	$ (6,271)	$ (49,831)	$ (9,885)
Other comprehensive (loss) income:
Cumulative translation adjustment	(235)	(2,589)	10,177	(2,756)
Unrealized gains on marketable securities, net of tax	3	6	8	0
Other comprehensive (loss) income	(232)	(2,583)	10,185	(2,756)
Comprehensive loss	$ (7,123)	$ (8,854)	$ (39,646)	$ (12,641)

Consolidated Statements of Chan

Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders' Equity (Unaudited) - 9 months ended Sep. 30, 2015 - USD ($) $ in Thousands	Total	Series A Preferred Stock	Series B Preferred Stock	Series C Preferred Stock	Series D Preferred Stock	Series E Preferred Stock	Series 1 Preferred Stock	Series F Preferred Stock	Preferred StockSeries A Preferred Stock	Preferred StockSeries B Preferred Stock	Preferred StockSeries C Preferred Stock	Preferred StockSeries D Preferred Stock	Preferred StockSeries E Preferred Stock	Preferred StockSeries 1 Preferred Stock	Preferred StockSeries F Preferred Stock	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Other Comprehensive (Loss) Income
Convertible preferred stock, beginning balance at Dec. 31, 2014	$ 80,212	$ 808	$ 865	$ 3,361	$ 27,870	$ 6,201	$ 1,322	$ 39,785	$ 808	$ 865	$ 3,361	$ 27,870	$ 6,201	$ 1,322	$ 39,785
Convertible preferred stock, beginning balance (in shares) at Dec. 31, 2014		2,363,786	1,128,425	1,222,282	4,215,610	396,727	203,399	11,594,203	2,363,786	1,128,425	1,222,282	4,215,610	396,727	203,399	11,594,203
Increase (Decrease) in Temporary Equity [Roll Forward]
Convertible preferred stock, conversion of preferred stock upon public offering									$ (808)	$ (865)	$ (3,361)	$ (27,870)	$ (6,201)	$ (1,322)	$ (39,785)
Convertible preferred stock, conversion of preferred stock upon public offering (in shares)									(2,363,786)	(1,128,425)	(1,222,282)	(4,215,610)	(396,727)	(203,399)	(11,594,203)
Convertible preferred stock, ending balance at Sep. 30, 2015	0	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0
Convertible preferred stock, ending balance (in shares) at Sep. 30, 2015		0	0	0	0	0	0	0	0	0	0	0	0	0	0
Beginning balance at Dec. 31, 2014	67,088															$ 44	$ 103,355	$ (32,377)	$ (3,934)
Beginning balance (in shares) at Dec. 31, 2014																44,180,939
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation expense	6,901																6,901
Exercise of vested options (in shares)																841,565
Exercise of vested options	2,285															$ 1	2,284
Common stock issued through public offering (in shares)																13,333,333
Common stock issued through public offering	194,361															$ 14	194,347
Contribution to Etsy.org, (in shares)																188,235
Contribution to Etsy.org	3,200																3,200
Stock expense-acquisitions	851																851
Conversion of preferred stock upon public offering (in shares)																53,448,243
Conversion of preferred stock upon public offering	80,212															$ 53	80,159
Conversion of warrants upon public offering	5,070																5,070
Excess tax benefit from the exercise of stock options	2,472																2,472
Other comprehensive income	10,185																		10,185
Net loss	(49,831)																	(49,831)
Ending balance at Sep. 30, 2015	$ 322,794															$ 112	$ 398,639	$ (82,208)	$ 6,251
Ending balance (in shares) at Sep. 30, 2015																111,992,315

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Cash flows from operating activities
Net loss	$ (49,831)	$ (9,885)
Adjustments to reconcile net loss to net cash provided by operating activities:
Stock-based compensation expense	6,559	4,212
Stock-based compensation expense-acquisitions	3,158	1,796
Contribution of stock to Etsy.org	3,200	0
Depreciation and amortization expense	14,041	12,492
Bad debt expense	1,473	1,037
Foreign exchange loss	15,727	1,014
Amortization of debt issuance costs	122	40
Net unrealized loss on warrant and other liabilities	3,136	239
Loss on disposal of assets	476	76
Amortization of deferred tax charges	15,093	0
Excess tax benefit from exercise of stock options	(2,472)	(716)
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable	(1,967)	(2,853)
Funds receivable and seller accounts	(6,710)	(2,956)
Prepaid expenses and other current assets	535	(1,712)
Other assets	152	(1,631)
Accounts payable	(3,530)	236
Accrued liabilities	17,719	6,378
Funds payable and amounts due to sellers	6,710	2,901
Deferred revenue	671	638
Other liabilities	(5,255)	680
Net cash provided by operating activities	19,007	11,986
Cash flows from investing activities
Acquisition of businesses, net of cash acquired	0	(4,688)
Purchases of property and equipment	(9,524)	(881)
Development of internal-use software	(7,329)	(6,019)
Purchase of U.S. Government and agency bills	(18,552)	(17,209)
Sale of marketable securities	17,270	16,846
Net increase in restricted cash	0	(5,341)
Net cash used in investing activities	(18,135)	(17,292)
Cash flows from financing activities
Proceeds from public offering	199,467	0
Proceeds from the issuance of common stock	0	35,000
Proceeds from exercise of stock options	2,285	7,585
Excess tax benefit from the exercise of stock options	2,472	716
Payments on capitalized lease obligations	(2,262)	(1,051)
Deferred payments on acquisition of business	0	(75)
Payments relating to public offering	(2,919)	(1,160)
Net cash provided by financing activities	199,043	41,015
Effect of exchange rate changes on cash	(3,291)	(1,305)
Net increase in cash and cash equivalents	196,624	34,404
Cash and cash equivalents at beginning of period	69,659	36,795
Cash and cash equivalents at end of period	266,283	71,199
Supplemental non-cash disclosures
Equipment acquired under capital lease obligations	8,273	3,288
Stock-based compensation capitalized in development of capitalized software	342	162
Non-cash additions to development of internal-use software and property and equipment	797	1,174
Non-cash addition to construction in progress related to build-to-suit lease and facility financing obligation	6,608	47,279
Non-cash addition to capitalized public offering costs	969	0
Fair value of common stock issued in acquisition	$ 0	$ 27,723

Basis of Presentation and Summa

Basis of Presentation and Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation and Summary of Significant Accounting Policies	Basis of Presentation and Summary of Significant Accounting Policies Description of Business Etsy, Inc. (the “Company” or “Etsy”) was incorporated in Delaware in February 2006. Etsy operates a marketplace where people around the world connect, both online and offline, to make, sell and buy unique goods. The Company generates revenue primarily from transaction and listing fees, Promoted Listings, Direct Checkout fees, and Shipping Label sales. Initial Public Offering On April 21, 2015, the Company completed an initial public offering (the "IPO") in which it issued and sold 13,333,333 shares of common stock at a public offering price of $16.00 per share. The Company received net proceeds of $194.4 million after deducting underwriting discounts of $13.9 million and other offering expenses of approximately $5.1 million . These expenses were recorded against the proceeds received from the IPO. Certain selling stockholders sold an additional 5,833,332 shares of common stock in the IPO. The Company did not receive any proceeds from the sale of shares sold by the selling stockholders. Upon the closing of the IPO, all outstanding shares of preferred stock of the Company converted into 53,448,243 shares of common stock. In addition, all outstanding warrants for preferred stock converted into warrants for 203,030 shares of common stock. Basis of Consolidation The consolidated financial statements include the accounts of Etsy and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Reclassifications Certain items in the prior years’ consolidated financial statements have been reclassified to conform to the current year presentation reflected in these interim financial statements. Specifically, the Company reclassified $4.6 million previously included in accrued expenses and other current liabilities on the consolidated balance sheets for 2014 to conform to the current period presentation. Unaudited Interim Financial Information The accompanying consolidated balance sheet as of September 30, 2015 , the consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2014 and 2015 , the consolidated statements of cash flows for the nine months ended September 30, 2014 and 2015 , and the consolidated statement of changes in convertible preferred stock and stockholders’ equity for the nine months ended September 30, 2015 are unaudited. The unaudited interim financial statements have been prepared on the same basis as the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to state fairly the Company’s financial position as of September 30, 2015 , results of operations for the three and nine months ended September 30, 2014 and 2015 , and cash flows for the nine months ended September 30, 2014 and 2015 . The financial data and the other information disclosed in these notes to the consolidated financial statements related to these three and nine -month periods are unaudited. These unaudited interim financial statements should be read in conjunction with the Company’s prospectus filed with the Securities and Exchange Commission on April 16, 2015 (the "Prospectus"). There have been no material changes in the Company's significant accounting policies from those that were disclosed in the Prospectus. Reverse Stock Split The Company effected a 1-for-2 reverse split of its common stock on March 25, 2015. The reverse split combined each two shares of the Company’s issued and outstanding common stock into one share of common stock and correspondingly adjusted the conversion prices of its convertible preferred stock. No fractional shares were issued in connection with the reverse split, and any fractional shares resulting from the reverse split were rounded down to the nearest whole share. All share, per share and related information presented in the consolidated financial statements and accompanying notes have been retroactively adjusted, where applicable, to reflect the reverse stock split. Use of Estimates The preparation of the Company’s consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The accounting estimates that require management’s most difficult and subjective judgments include revenue recognition, income taxes, website development costs and internal-use software, purchase price allocations for business combinations, valuation of goodwill and intangible assets and stock-based compensation. The Company evaluates its estimates and judgments on an ongoing basis and revises them when necessary. Actual results may differ from the original or revised estimates. Income Taxes The Company's income tax provision for interim periods is determined using an estimate of its annual effective tax rate adjusted for discrete items, if any, for relevant interim periods. The Company updates its estimate of the annual effective tax rate each quarter and makes cumulative adjustments if its estimated annual tax rate changes. The Company's quarterly tax provision and quarterly estimate of its annual effective tax rate are subject to significant variations due to several factors, including variability in predicting its pretax and taxable income and the mix of jurisdictions to which those relate, changes of expenses or losses for which tax benefits are not recognized, and changes in the laws, regulations and administrative practices of the jurisdictions in which the Company operates. Business Combinations On April 29, 2014, the Company completed the acquisition of Jarvis Labs, Inc., owners of the “Grand St.” online technology marketplace. Total consideration for the acquisition was approximately $3.2 million , consisting of $1.0 million in cash and 212,552 shares of the Company’s common stock with a fair value of $2.2 million on the acquisition date. Additionally, the Company issued 328,580 shares of common stock, with a fair value of $3.4 million on the acquisition date, which are tied to continuous service with the Company as an employee or consultant and are being accounted for as post-acquisition stock-based compensation expense over the three -year vesting period. Because the Company was not publicly traded at the time of the acquisition, the Company utilized equity valuations based on comparable publicly-traded companies, discounted cash flows, an analysis of the Company’s enterprise value and any other factors deemed relevant in estimating the fair value of its common stock for purposes of calculating the fair value of the purchase price. On June 18, 2014, the Company completed the acquisition of Incubart SAS, a societe par actions simplifiee organized under the laws of France, which operates the online marketplace A Little Market (“ALM”). Total consideration for the acquisition was $30.8 million , consisting of $5.3 million in cash, of which $4.2 million was paid on the closing date, $0.3 million was paid on March 31, 2015 and $0.8 million is due to be paid on February 16, 2016, and 2,439,847 shares of the Company’s common stock with a fair value of $25.5 million on the acquisition date. Because the Company was not publicly traded at the time of the acquisition, the Company utilized equity valuations based on comparable publicly-traded companies, discounted cash flows, an analysis of the Company’s enterprise value and any other factors deemed relevant in estimating the fair value of its common stock for purposes of calculating the fair value of the purchase price. The terms of the purchase agreement provide for the sale of put options to certain of the former shareholders of ALM. The put options enable the holders of the options to sell up to all of their shares back to the Company, subject to certain vesting and restrictions, at fair value, but not to exceed $8.26 per share and not less than $4.00 per share. The put right terminates with respect to a share on the earlier of one year from when such share is vested or the liquidation date, as defined in the agreement containing the put option. The holders of the options paid an aggregate of $0.1 million cash to the Company at the date of acquisition and the Company recorded a $0.1 million liability for the fair value of the put options at that time. Additionally, the Company issued 599,497 shares of common stock, with a fair value of $6.3 million on the acquisition date, which are tied to continuous service with the Company as an employee or consultant and are being accounted for as post-acquisition stock-based compensation expense over the three -year vesting period. Since the put options relate in part to these shares, these restricted shares will be recorded as liability-classified stock awards as earned. The following pro forma financial information presents the combined operating results of the Company, Grand St. and ALM as if each acquisition had occurred as of January 1, 2014. The pro forma financial information includes the accounting effects of the business combinations, including adjustments to the amortization of intangible assets and professional fees associated with the acquisition. The unaudited pro forma information does not necessarily reflect the actual results that would have been achieved, nor is it necessarily indicative of our future consolidated results. The pro forma financial information is presented in the table below for the nine months ended September 30, 2014 (in thousands except per share amounts): Nine Months Ended September 30, 2014 Revenue $ 132,483 Net loss $ (10,887 ) Basic and diluted net loss per share $ (0.27 ) During the second quarter of 2015, the Company recognized changes to assets and liabilities impacting the associated purchase price allocations of ALM and Grand St. at their respective dates of acquisition. These adjustments resulted in a decrease to the initial purchase price allocation of goodwill for ALM and Grand St. of $0.4 million and $0.2 million , respectively. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board, or FASB, issued an accounting standards update that replaces existing revenue recognition guidance. The new guidance is effective for the annual and interim periods beginning after December 15, 2017. Among other things, the updated guidance requires companies to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company is currently evaluating the effect the guidance will have on its consolidated financial statements. In August 2014, the FASB issued an accounting standard update under which management will be required to assess an entity’s ability to continue as a going concern and provide related disclosures in certain circumstances. The new guidance is effective for annual and interim periods beginning after December 15, 2016. The adoption of this guidance is not expected to have an impact on the Company’s consolidated financial statements or disclosures. In April 2015, the FASB issued an accounting standard under which customers will apply the same criteria as vendors to determine whether a cloud computing arrangement contains a software license or is solely a service contract. The new standard is effective for annual and interim periods beginning after December 15, 2015. The Company is currently evaluating the effect the guidance will have on its consolidated financial statements. In August 2015, the FASB issued an accounting standard update to address the presentation and subsequent measurement of debt issuance costs related to line-of-credit arrangements. The guidance affirms the Company's treatment of such costs, which is to defer and present the debt issuance costs as an asset and subsequently amortize the costs over the term of the line-of-credit arrangement. The adoption of this guidance is not expected to have an impact on the Company’s consolidated financial statements or disclosures. In September 2015, the FASB issued an accounting standard update that eliminates the requirement that an acquirer in a business combination account for measurement-period adjustments retrospectively. Instead, an acquirer will recognize a measurement-period adjustment during the period in which it determines the amount of the adjustment. The new guidance is effective for annual and interim periods beginning after December 15, 2015. The adoption of this guidance is not expected to have an impact on the Company’s consolidated financial statements or disclosures.

Debt

Debt	9 Months Ended
	Sep. 30, 2015
Debt Disclosure [Abstract]
Debt	Debt Credit Agreement In May 2014, the Company entered into a $35.0 million senior secured revolving credit facility pursuant to a Revolving Credit and Guaranty Agreement with several lenders (the “Credit Agreement”). The Credit Agreement will mature in May 2019. The Credit Agreement includes a letter of credit sublimit of $10.0 million and a swingline loan sublimit of $15.0 million. Borrowings under the Credit Agreement (other than swingline loans) bear interest, at the Company’s option, at (i) a base rate equal to the highest of (a) the prime rate, (b) the federal funds rate plus 0.50% and (c) an adjusted LIBOR rate for a one-month interest period plus 1.00% , in each case plus a margin ranging from 0.00% to 0.25% or (ii) an adjusted LIBOR rate plus a margin ranging from 1.00% to 1.25% . Swingline loans under the Credit Agreement bear interest at the same base rate (plus the margin applicable to borrowings bearing interest at the base rate). These margins are determined based on the total leverage ratio for the preceding four-fiscal-quarter period. The Company is also obligated to pay other customary fees for a credit facility of this size and type, including an unused commitment fee and fees associated with letters of credit. The Credit Agreement also permits the Company, in certain circumstances, to request an increase in the facility by an amount of up to $50.0 million (and in minimum amounts of $10.0 million ) at the same maturity, pricing and other terms. The Credit Agreement contains customary representations and warranties applicable to the Company and its subsidiaries and customary affirmative and negative covenants applicable to the Company and its restricted subsidiaries. The negative covenants include restrictions on, among other things, indebtedness, liens, investments, mergers, dispositions, transactions with affiliates and dividends and other distributions. These restrictions do not prohibit a subsidiary of the Company from making pro rata payments to the Company or any other person that owns an equity interest in such subsidiary. The Credit Agreement contains a financial covenant that requires the Company and its subsidiaries to maintain a total leverage ratio (defined as net debt to adjusted EBITDA) not to exceed 3.50 to 1.00 . The Credit Agreement includes customary events of default, including a change in control and a cross-default on the Company’s material indebtedness. The Company’s obligations under the Credit Agreement are secured by substantially all of the Company and its subsidiaries’ assets, and its obligations under the Credit Agreement are guaranteed by certain of the Company’s subsidiaries. In March 2015, the Company amended the Credit Agreement (the “Amended Credit Agreement”) to increase the senior secured revolving credit facility to $50.0 million. The Amended Credit Agreement contains the same pricing covenants and other material terms as the Credit Agreement. At September 30, 2015 , the Company did not have any borrowings under the Credit Agreement.

Stock-based Compensation

Stock-based Compensation	9 Months Ended
	Sep. 30, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-based Compensation	Stock-based Compensation The Company's 2015 Equity Incentive Plan (the "2015 Plan") was adopted by its board of directors and approved by stockholders in March 2015. The 2015 Plan became effective immediately upon adoption although no awards were made under it until the effective date of the IPO. The 2015 Plan replaced the 2006 Stock Plan, and no further grants were made under the 2006 Stock Plan as of the effective date of the IPO. The 2015 Plan provides for the grant of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock, restricted stock units ("RSUs") and performance cash awards to employees, directors and consultants. The number of shares available for issuance under the 2015 Plan may be increased annually commencing January 1, 2016 by an amount equal to the lesser of 7,050,000 shares of common stock, 5% of the outstanding shares of common stock as of the last day of the immediately preceding fiscal year, or such other amount as determined by the Company's board of directors. Any awards issued under the 2015 Plan that are forfeited by the participant will become available for future grant under the 2015 Plan. The number of shares of the Company’s common stock initially reserved for issuance under the 2015 Plan equaled the sum of 14,100,000 shares plus up to 12,653,075 shares reserved for issuance or subject to outstanding awards under the 2006 Stock Plan. At September 30, 2015 , 15,068,816 shares were authorized under the 2015 Plan, and 14,377,502 shares were available for future grant. In the nine months ended September 30, 2015 , we granted incentive stock options, nonqualified stock options and RSUs to eligible participants. Options were generally granted for a term of 10 years and vest 25% after the first year of service and ratably each month over the remaining 36 -month period contingent on continued employment with the Company on each vesting date. RSUs generally vest 25% after the first year following the vesting commencement date, which is the first day of the fiscal quarter closest to the date of grant, and then vest ratably each quarter over the remaining 12 -quarter period contingent on continued employment with the Company on each vesting date. The fair value of each option award is estimated on the date of grant using the Black-Scholes option-pricing model using the inputs below. Prior to the IPO, the Company utilized equity valuations based on comparable publicly-traded companies, discounted free cash flows, an analysis of the Company's enterprise value and any other factors deemed relevant in estimating the fair value of its common stock. Subsequent to the IPO, the Company has used the closing price of its common stock on Nasdaq as the fair value of its common stock. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. Expected volatilities are based on implied volatilities from market comparisons of certain publicly traded companies and other factors. The expected term of stock options granted has been determined using the simplified method, which uses the midpoint between the vesting date and the contractual term. The requisite service period is generally four years from the date of grant. The fair value of RSUs is determined based on the closing price of the Company's common stock on Nasdaq on the grant date. The Company granted 102,313 stock options in the three months ended September 30, 2015 at a weighted average grant date fair value of $6.70 . The Company granted 1,512,324 stock options in the nine months ended September 30, 2015 at a weighted average grant date fair value of $7.10 . The Company granted 146,727 RSUs in the three months ended September 30, 2015 at a weighted average grant date fair value of $16.63 . The Company granted 201,875 RSUs in the nine months ended September 30, 2015 at a weighted average grant date fair value of $16.53 . The fair value of options granted in each year using the Black-Scholes pricing model has been based on the following assumptions: Three Months Ended Nine Months Ended 2014 2015 2014 2015 Volatility 45.9% - 48.0% 44.1% - 44.7% 45.9% - 49.0% 40.4% - 45.0% Risk-free interest rate 1.9% - 2.0% 1.7% - 1.9% 1.7% - 2.0% 1.3% - 1.9% Expected term (in years) 5.7 - 6.1 6.0 - 6.1 5.5 - 6.1 5.5 - 6.1 Dividend rate —% —% —% —% Total stock-based compensation expense included in the consolidated statements of operations is as follows (in thousands): Three Months Ended Nine Months Ended 2014 2015 2014 2015 Cost of revenue $ 357 $ 149 $ 731 $ 681 Marketing 59 120 131 349 Product development 333 756 995 1,981 General and administrative 1,998 1,898 4,151 6,706 $ 2,747 $ 2,923 $ 6,008 $ 9,717 The total stock-based compensation expense in the three months ended September 30, 2014 and 2015 includes $1.4 million and $0.7 million in acquisition-related stock-based compensation expense, respectively. The total stock-based compensation expense in the nine months ended September 30, 2014 and 2015 includes $1.8 million and $3.2 million in acquisition-related stock-based compensation expense, respectively.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2015
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes In January 2015, the Company implemented an updated global corporate structure to more closely align with its global operations and future expansion plans outside of the United States. The new structure changed how the Company uses its intellectual property and implemented certain intercompany arrangements. The Company believes this may result in a reduction in its overall effective tax rate and other operational efficiencies. The revised structure resulted in the setup of a deferred tax liability in the amount of $67.8 million on the taxable gain created in the transaction. A deferred charge was recorded for the same amount representing the future income tax which will be amortized into income tax expense over five years. During the three and nine months ended September 30, 2015 , $3.7 million and $11.3 million was recorded to income tax expense, respectively. The amount of unrecognized tax benefits, included within “Other liabilities” on the consolidated balance sheets, increased $20.4 million in the nine months ended September 30, 2015 , from $0.4 million at December 31, 2014 to $20.8 million at September 30, 2015 . The increase was primarily in connection with the implementation of the updated global corporate structure. During the three and nine months ended September 30, 2015 , $1.1 million and $3.4 million was recorded to income tax expense, respectively, for the implementation. The total amount of unrecognized tax benefits that, if recognized, would favorably affect the effective tax rate is $5.5 million at September 30, 2015 . A deferred charge of $20.2 million was recorded representing the future income tax which will be amortized into income tax expense over five years. Additionally, the Company recognized $4.5 million of tax benefit for a research and development tax credit during the three months ended September 30, 2015 .

Fair Value Measurements

Fair Value Measurements	9 Months Ended
	Sep. 30, 2015
Fair Value Disclosures [Abstract]
Fair Value Measurements	Fair Value Measurements The Company has characterized its investments in marketable securities, based on the priority of the inputs used to value the investments, into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1), and lowest priority to unobservable inputs (Level 3). If the inputs used to measure the investments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the investment. Investments recorded in the accompanying consolidated balance sheet are categorized based on the inputs to valuation techniques as follows: Level 1—These are investments where values are based on unadjusted quoted prices for identical assets in an active market that the Company has the ability to access. Level 2—These are investments where values are based on quoted market prices in markets that are not active or model derived valuations in which all significant inputs are observable in active markets. Level 3—These are liabilities where values are derived from techniques in which one or more significant inputs are unobservable. The following are the major categories of assets and liabilities measured at fair value on a recurring basis as of December 31, 2014 and September 30, 2015 using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2) and significant unobservable inputs (Level 3) (in thousands): As of December 31, 2014 Level 1 Level 2 Level 3 Total Asset Cash equivalents: Money market funds $ 20,288 $ — $ — $ 20,288 U.S. Government bills 2,426 — — 2,426 22,714 — — 22,714 Short-term investments: U.S. Government and agency bills 19,184 — — 19,184 $ 41,898 $ — $ — $ 41,898 Liability Put option classified as liability $ — $ — $ 16 $ 16 Acquisition–related contingent consideration classified as liability — — 3,374 3,374 Warrants classified as liability — — 1,920 1,920 $ — $ — $ 5,310 $ 5,310 As of September 30, 2015 Level 1 Level 2 Level 3 Total Asset Cash equivalents: Money market funds $ 19,778 $ — $ — $ 19,778 U.S. Government bills 1,160 — — 1,160 20,938 — — 20,938 Short-term investments: U.S. Government and agency bills 20,474 — — 20,474 $ 41,412 $ — $ — $ 41,412 Liability Put option classified as liability $ — $ — $ 3 $ 3 Acquisition–related contingent consideration classified as liability — — 5,680 5,680 Warrants classified as liability — — — — $ — $ — $ 5,683 $ 5,683 Level 1 instruments include money market funds and Corporate Certificates of Deposit and AAA-rated U.S. Government and agency securities, which are valued based on inputs including quotes from broker-dealers or recently executed transactions in the same or similar securities. Level 3 instruments include contingent consideration classified as liability in connection with the acquisition of ALM and convertible warrants classified as liability. The contingent consideration is classified as liability due to its affiliation with a related put option, which will expire in the fourth quarter of 2015, and its fair value is determined based on the fair value of the Company's common stock at the period-end reporting date. The fair value of the warrants classified as liability is determined using the period-end fair value of the Company's common stock, the risk-free rate for periods within the contractual life of the warrant based on the U.S. Treasury yield curve in effect at the time of grant, implied volatilities from market comparisons of certain publicly traded companies and the contractual term. On the date of the IPO, the warrants converted from warrants for preferred stock to warrants for common stock and as a result are no longer classified as liability or subject to further fair value adjustments. The table below provides a reconciliation of the beginning and ending balances for the liabilities measured at fair value using significant unobservable inputs (Level 3) (in thousands): Nine Months Ended 2015 Balance at beginning of period $ 5,310 Acquired — Changes to liability-classified stock awards 2,964 Settled — Conversion of warrants to equity (5,070 ) Net increase in fair value 2,479 Balance at end of period $ 5,683

Net Loss Per Share

Net Loss Per Share	9 Months Ended
	Sep. 30, 2015
Earnings Per Share [Abstract]
Net Loss Per Share	Net Loss Per Share The following table presents the calculation of basic and diluted net loss per share for periods presented (in thousands, except share and per share data): Three Months Ended Nine Months Ended 2014 2015 2014 2015 Net loss $ (6,271 ) $ (6,891 ) $ (9,885 ) $ (49,831 ) Basic and diluted shares: Weighted average common shares outstanding 43,015,151 111,329,917 39,258,879 84,195,227 Net loss per share attributable to common stockholders: Basic and diluted net loss per share applicable to common stockholders $ (0.15 ) $ (0.06 ) $ (0.25 ) $ (0.59 ) The following potential common shares were excluded from the calculation of diluted net loss per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented: Three Months Ended Nine Months Ended 2014 2015 2014 2015 Stock options 10,743,878 11,904,577 11,329,156 11,914,369 Restricted Stock Units — 148,188 — 60,204 Warrants 203,030 203,030 203,030 203,030 Convertible preferred stock 53,448,243 — 53,448,243 21,731,703 Total anti-dilutive securities 64,395,151 12,255,795 64,980,429 33,909,306

Segment and Geographic Informat

Segment and Geographic Information	9 Months Ended
	Sep. 30, 2015
Segment Reporting [Abstract]
Segment and Geographic Information	Segment and Geographic Information Revenue by country is based on the billing address of the seller. The following table summarizes revenue by geographic area (in thousands): Three Months Ended Nine Months Ended 2014 2015 2014 2015 United States $ 37,311 $ 51,593 $ 104,119 $ 145,326 International 10,323 14,103 26,560 40,278 Revenue $ 47,634 $ 65,696 $ 130,679 $ 185,604 No individual international country’s revenue exceeded 5% of total revenue.

Contingencies

Contingencies	9 Months Ended
	Sep. 30, 2015
Commitments and Contingencies Disclosure [Abstract]
Contingencies	Contingencies Tax Contingencies The Company had reserves of $3.5 million and $2.6 million at December 31, 2014 and September 30, 2015 , respectively, for certain non-income tax obligations, representing management’s best estimate of its potential liability. The Company could also be subject to examination in various jurisdictions related to income tax and non-income tax matters. The resolution of these types of matters, if in excess of the recorded reserve, could have an adverse impact on the Company’s business. Legal Proceedings On May 13, 2015, a purported securities class action complaint ( Altayyar v. Etsy, Inc., et al. , Docket No. 1:15-cv-02785) was filed in the United States District Court for the Eastern District of New York against the Company and certain officers. The complaint is brought on behalf of a purported class consisting of all persons or entities who purchased or otherwise acquired shares of the Company's common stock from April 16, 2015 through and including May 10, 2015. The complaint asserts violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 based on allegedly false or misleading statements and omissions with respect to, among other things, merchandise for sale on the Company's website that may be counterfeit or constitute trademark or copyright infringement and actions taken by third-party brands against Etsy sellers for trademark or copyright infringement. The complaint seeks certification as a class action and unspecified compensatory damages plus interest and attorneys' fees. On October 22, 2015, the court appointed a lead plaintiff and lead plaintiff’s counsel. The Company and the named officers intend to defend themselves vigorously against this action. In light of, among other things, the early stage of the litigation, the Company is unable to predict the outcome of this matter and is unable to make a meaningful estimate of the amount or range of loss, if any, that could result from an unfavorable outcome. On July 21, 2015, a purported securities class action complaint ( Cervantes v. Dickerson, et.al ., Case No. CIV 534768) was filed in the Superior Court of State of California, County of San Mateo against the Company, certain officers, directors and underwriters. The complaint asserts violations of Sections 11 and 15 of the Securities Act of 1933. As in the Altayyar litigation, the complaint alleges misrepresentations in the Company’s Prospectus with respect to, among other things, merchandise for sale on the Company's website that may be counterfeit or constitute trademark or copyright infringement. The complaint seeks certification as a class action and unspecified compensatory damages plus interest and attorneys' fees. On August 20, 2015, the Company removed the case to the United States District Court for the Northern District of California (Case No. 4:15-cv-03825-PJH). On October 21, 2015, the court granted plaintiff’s motion to remand the case to the Superior Court of California, San Mateo County. The Company and the named officers and directors intend to defend themselves vigorously against this action. In light of, among other things, the early stage of the litigation, the Company is unable to predict the outcome of this matter and is unable to make a meaningful estimate of the amount or range of loss, if any, that could result from an unfavorable outcome. In addition, from time to time in the normal course of business, various other claims and litigation have been asserted or commenced against the Company. Due to uncertainties inherent in litigation and other claims, the Company can give no assurance that it will prevail in any such matters, which could subject the Company to significant liability for damages. Any claims or litigation, regardless of their success, could have an adverse effect on the Company’s consolidated results of operations or cash flows in the period the claims or litigation are resolved. As of September 30, 2015 , the Company does not believe that there are any material litigation exposures relating to these other claims.

Basis of Presentation and Sum16

Basis of Presentation and Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Consolidation	The consolidated financial statements include the accounts of Etsy and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Use of Estimates	The preparation of the Company’s consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The accounting estimates that require management’s most difficult and subjective judgments include revenue recognition, income taxes, website development costs and internal-use software, purchase price allocations for business combinations, valuation of goodwill and intangible assets and stock-based compensation. The Company evaluates its estimates and judgments on an ongoing basis and revises them when necessary. Actual results may differ from the original or revised estimates.
Income Taxes	The Company's income tax provision for interim periods is determined using an estimate of its annual effective tax rate adjusted for discrete items, if any, for relevant interim periods. The Company updates its estimate of the annual effective tax rate each quarter and makes cumulative adjustments if its estimated annual tax rate changes. The Company's quarterly tax provision and quarterly estimate of its annual effective tax rate are subject to significant variations due to several factors, including variability in predicting its pretax and taxable income and the mix of jurisdictions to which those relate, changes of expenses or losses for which tax benefits are not recognized, and changes in the laws, regulations and administrative practices of the jurisdictions in which the Company operates.
Recent Accounting Pronouncements	In May 2014, the Financial Accounting Standards Board, or FASB, issued an accounting standards update that replaces existing revenue recognition guidance. The new guidance is effective for the annual and interim periods beginning after December 15, 2017. Among other things, the updated guidance requires companies to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company is currently evaluating the effect the guidance will have on its consolidated financial statements. In August 2014, the FASB issued an accounting standard update under which management will be required to assess an entity’s ability to continue as a going concern and provide related disclosures in certain circumstances. The new guidance is effective for annual and interim periods beginning after December 15, 2016. The adoption of this guidance is not expected to have an impact on the Company’s consolidated financial statements or disclosures. In April 2015, the FASB issued an accounting standard under which customers will apply the same criteria as vendors to determine whether a cloud computing arrangement contains a software license or is solely a service contract. The new standard is effective for annual and interim periods beginning after December 15, 2015. The Company is currently evaluating the effect the guidance will have on its consolidated financial statements. In August 2015, the FASB issued an accounting standard update to address the presentation and subsequent measurement of debt issuance costs related to line-of-credit arrangements. The guidance affirms the Company's treatment of such costs, which is to defer and present the debt issuance costs as an asset and subsequently amortize the costs over the term of the line-of-credit arrangement. The adoption of this guidance is not expected to have an impact on the Company’s consolidated financial statements or disclosures. In September 2015, the FASB issued an accounting standard update that eliminates the requirement that an acquirer in a business combination account for measurement-period adjustments retrospectively. Instead, an acquirer will recognize a measurement-period adjustment during the period in which it determines the amount of the adjustment. The new guidance is effective for annual and interim periods beginning after December 15, 2015. The adoption of this guidance is not expected to have an impact on the Company’s consolidated financial statements or disclosures.

Basis of Presentation and Sum17

Basis of Presentation and Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Business Acquisition, Pro Forma Information	The pro forma financial information is presented in the table below for the nine months ended September 30, 2014 (in thousands except per share amounts): Nine Months Ended September 30, 2014 Revenue $ 132,483 Net loss $ (10,887 ) Basic and diluted net loss per share $ (0.27 )

Stock-based Compensation (Table

Stock-based Compensation (Tables)	9 Months Ended
	Sep. 30, 2015
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions	The fair value of options granted in each year using the Black-Scholes pricing model has been based on the following assumptions: Three Months Ended Nine Months Ended 2014 2015 2014 2015 Volatility 45.9% - 48.0% 44.1% - 44.7% 45.9% - 49.0% 40.4% - 45.0% Risk-free interest rate 1.9% - 2.0% 1.7% - 1.9% 1.7% - 2.0% 1.3% - 1.9% Expected term (in years) 5.7 - 6.1 6.0 - 6.1 5.5 - 6.1 5.5 - 6.1 Dividend rate —% —% —% —%
Schedule of Share-based Compensation, Allocation of Recognized Period Costs	Total stock-based compensation expense included in the consolidated statements of operations is as follows (in thousands): Three Months Ended Nine Months Ended 2014 2015 2014 2015 Cost of revenue $ 357 $ 149 $ 731 $ 681 Marketing 59 120 131 349 Product development 333 756 995 1,981 General and administrative 1,998 1,898 4,151 6,706 $ 2,747 $ 2,923 $ 6,008 $ 9,717

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	9 Months Ended
	Sep. 30, 2015
Fair Value Disclosures [Abstract]
Fair Value Measurements, Recurring	The following are the major categories of assets and liabilities measured at fair value on a recurring basis as of December 31, 2014 and September 30, 2015 using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2) and significant unobservable inputs (Level 3) (in thousands): As of December 31, 2014 Level 1 Level 2 Level 3 Total Asset Cash equivalents: Money market funds $ 20,288 $ — $ — $ 20,288 U.S. Government bills 2,426 — — 2,426 22,714 — — 22,714 Short-term investments: U.S. Government and agency bills 19,184 — — 19,184 $ 41,898 $ — $ — $ 41,898 Liability Put option classified as liability $ — $ — $ 16 $ 16 Acquisition–related contingent consideration classified as liability — — 3,374 3,374 Warrants classified as liability — — 1,920 1,920 $ — $ — $ 5,310 $ 5,310 As of September 30, 2015 Level 1 Level 2 Level 3 Total Asset Cash equivalents: Money market funds $ 19,778 $ — $ — $ 19,778 U.S. Government bills 1,160 — — 1,160 20,938 — — 20,938 Short-term investments: U.S. Government and agency bills 20,474 — — 20,474 $ 41,412 $ — $ — $ 41,412 Liability Put option classified as liability $ — $ — $ 3 $ 3 Acquisition–related contingent consideration classified as liability — — 5,680 5,680 Warrants classified as liability — — — — $ — $ — $ 5,683 $ 5,683
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation	The table below provides a reconciliation of the beginning and ending balances for the liabilities measured at fair value using significant unobservable inputs (Level 3) (in thousands): Nine Months Ended 2015 Balance at beginning of period $ 5,310 Acquired — Changes to liability-classified stock awards 2,964 Settled — Conversion of warrants to equity (5,070 ) Net increase in fair value 2,479 Balance at end of period $ 5,683

Net Loss Per Share (Tables)

Net Loss Per Share (Tables)	9 Months Ended
	Sep. 30, 2015
Earnings Per Share [Abstract]
Schedule of Earnings Per Share, Basic and Diluted	The following table presents the calculation of basic and diluted net loss per share for periods presented (in thousands, except share and per share data): Three Months Ended Nine Months Ended 2014 2015 2014 2015 Net loss $ (6,271 ) $ (6,891 ) $ (9,885 ) $ (49,831 ) Basic and diluted shares: Weighted average common shares outstanding 43,015,151 111,329,917 39,258,879 84,195,227 Net loss per share attributable to common stockholders: Basic and diluted net loss per share applicable to common stockholders $ (0.15 ) $ (0.06 ) $ (0.25 ) $ (0.59 )
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share	The following potential common shares were excluded from the calculation of diluted net loss per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented: Three Months Ended Nine Months Ended 2014 2015 2014 2015 Stock options 10,743,878 11,904,577 11,329,156 11,914,369 Restricted Stock Units — 148,188 — 60,204 Warrants 203,030 203,030 203,030 203,030 Convertible preferred stock 53,448,243 — 53,448,243 21,731,703 Total anti-dilutive securities 64,395,151 12,255,795 64,980,429 33,909,306

Segment and Geographic Inform21

Segment and Geographic Information (Tables)	9 Months Ended
	Sep. 30, 2015
Segment Reporting [Abstract]
Revenue from External Customers by Geographic Areas	The following table summarizes revenue by geographic area (in thousands): Three Months Ended Nine Months Ended 2014 2015 2014 2015 United States $ 37,311 $ 51,593 $ 104,119 $ 145,326 International 10,323 14,103 26,560 40,278 Revenue $ 47,634 $ 65,696 $ 130,679 $ 185,604

Basis of Presentation and Sum22

Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Details) $ / shares in Units, $ in Thousands	Apr. 21, 2015USD ($)$ / sharesshares	Mar. 25, 2015	Sep. 30, 2015USD ($)	Sep. 30, 2014USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Proceeds from initial public offering			$ 199,467	$ 0
Reverse stock split conversion ratio		0.5
IPO
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued | shares	13,333,333
Share price | $ / shares	$ 16
Proceeds from initial public offering	$ 194,400
Underwriting discount	13,900
Other offering expense	$ 5,100
Sale of stock by stockholders | shares	5,833,332
Conversion of preferred stock warrants into common stock warrants | shares	203,030
Convertible preferred stock | IPO
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Conversion of convertible preferred stock into common stock, shares | shares	53,448,243
Accrued Expenses and Other Current Liabilities
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Prior period reclassification adjustment			$ 4,600

Basis of Presentation and Sum23

Basis of Presentation and Summary of Significant Accounting Policies - Business Combinations (Details) - USD ($) $ / shares in Units, $ in Thousands	Feb. 16, 2016	Mar. 31, 2015	Jun. 18, 2014	Apr. 29, 2014	Jun. 30, 2015	Sep. 30, 2014	Feb. 16, 2016
Business Acquisition [Line Items]
Revenue						$ 132,483
Net loss						$ (10,887)
Basic and diluted net loss per share						$ (0.27)
Jarvis Labs, Inc
Business Acquisition [Line Items]
Consideration transferred				$ 3,200
Cash paid in business acquisition				$ 1,000
Number of shares issued for business acquisition				212,552
Fair value of shares issued for business acquisition				$ 2,200
Shares issued				328,580
Fair value of shares issued				$ 3,400
Vesting period				3 years
Decrease in goodwill since acquisition					$ 200
Incubart SAS
Business Acquisition [Line Items]
Consideration transferred			$ 30,800
Cash paid in business acquisition		$ 300	$ 4,200
Number of shares issued for business acquisition			2,439,847
Fair value of shares issued for business acquisition			$ 25,500
Shares issued			599,497
Fair value of shares issued			$ 6,300
Vesting period			3 years
Decrease in goodwill since acquisition					$ 400
Put Option | Incubart SAS
Business Acquisition [Line Items]
Proceeds from sale of options indexed to issuers' equity			$ 100
Liability			$ 100
Put Option | Minimum | Incubart SAS
Business Acquisition [Line Items]
Price per share (USD per share)			$ 4
Put Option | Maximum | Incubart SAS
Business Acquisition [Line Items]
Price per share (USD per share)			$ 8.26
Forecast | Incubart SAS
Business Acquisition [Line Items]
Cash paid in business acquisition	$ 800						$ 5,300

Debt (Details)

Debt (Details) - Revolving Credit Facility	9 Months Ended
	Sep. 30, 2015USD ($)	Mar. 31, 2015USD ($)	May. 31, 2014USD ($)
Debt Instrument [Line Items]
Line of credit, maximum borrowing capacity		$ 50,000,000	$ 35,000,000
Line of credit, maximum available borrowing capacity	$ 50,000,000
Line of credit, maximum available borrowing capacity, minimum increment of increase	$ 10,000,000
Total leverage ratio	3.50
Outstanding borrowings	$ 0
Letter of Credit
Debt Instrument [Line Items]
Line of credit, maximum borrowing capacity			10,000,000
Bridge Loan
Debt Instrument [Line Items]
Line of credit, maximum borrowing capacity			$ 15,000,000
Federal Funds Effective Swap Rate
Debt Instrument [Line Items]
Line of credit, basis spread on variable interest rate	0.50%
One-Month London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Line of credit, basis spread on variable interest rate	1.00%
Minimum | One-Month London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Line of credit, basis spread on variable interest rate	1.00%
Minimum | Base Rate
Debt Instrument [Line Items]
Line of credit, basis spread on variable interest rate	0.00%
Maximum | One-Month London Interbank Offered Rate (LIBOR)
Debt Instrument [Line Items]
Line of credit, basis spread on variable interest rate	1.25%
Maximum | Base Rate
Debt Instrument [Line Items]
Line of credit, basis spread on variable interest rate	0.25%

Stock-based Compensation - Fair

Stock-based Compensation - Fair Value of Options Granted Using the Black-Scholes Pricing Model (Details) - Stock options	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Volatility, minimum	44.10%	45.90%	40.40%	45.90%
Volatility, maximum	44.70%	48.00%	45.00%	49.00%
Risk-free interest rate, minimum	1.70%	1.90%	1.30%	1.70%
Risk-free interest rate, maximum	1.90%	2.00%	1.90%	2.00%
Dividend rate	0.00%	0.00%	0.00%	0.00%
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	6 years	5 years 8 months 12 days	5 years 6 months	5 years 6 months
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	6 years 1 month 6 days	6 years 1 month 6 days	6 years 1 month 6 days	6 years 1 month 6 days

Stock-based Compensation - Allo

Stock-based Compensation - Allocated Share-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 2,923	$ 2,747	$ 9,717	$ 6,008
Cost of revenue
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	149	357	681	731
Marketing
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	120	59	349	131
Product development
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	756	333	1,981	995
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 1,898	$ 1,998	$ 6,706	$ 4,151

Stock-based Compensation - Addi

Stock-based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense-acquisitions	$ 700	$ 1,400	$ 3,158	$ 1,796
2015 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum number of additional shares issued annually			7,050,000
Percentage of outstanding stock			5.00%
Shares reserved for future issuance	14,100,000		14,100,000
Number of shares authorized	15,068,816		15,068,816
Number of shares available for grant	14,377,502		14,377,502
Options granted in period (in shares)	102,313		1,512,324
Weighted average grant date fair value of options	$ 6.70		$ 7.10
2015 Equity Incentive Plan | Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Term for options			10 years
Stock option requisite service period			4 years
2015 Equity Incentive Plan | Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock granted in period (in shares)	146,727		201,875
Weighted average grant date fair value of restricted stock	$ 16.63		$ 16.53
2006 Plan Eligible for 2015 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares reserved for future issuance	12,653,075		12,653,075
Tranche One | 2015 Equity Incentive Plan | Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option vesting rights, percentage			25.00%
Tranche One | 2015 Equity Incentive Plan | Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option vesting rights, percentage			25.00%
Tranche Two | 2015 Equity Incentive Plan | Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option vesting period			36 months
Tranche Two | 2015 Equity Incentive Plan | Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock option vesting period			3 years

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended	9 Months Ended
	Jan. 31, 2015	Sep. 30, 2015	Sep. 30, 2015	Dec. 31, 2014
Income Tax Contingency [Line Items]
Deferred tax liability for gain in revised corporate structure transaction	$ 67.8
Deferred tax charge related to deferred tax liability	$ 67.8
Deferred charge amortization period	5 years		5 years
Deferred charge amortized to income tax expense		$ 3.7	$ 11.3
Amortization of deferred charges related to unrecognized tax benefits		1.1	3.4
Unrecognized tax benefits that would impact effective tax rate favorably		5.5	5.5
Deferred charge related to unrecognized tax benefits		20.2	20.2
Tax benefit recognized from research and development tax credit		4.5
Other Liabilities
Income Tax Contingency [Line Items]
Increase in unrecognized tax benefits			20.4
Unrecognized tax benefits		$ 20.8	$ 20.8	$ 0.4

Fair Value Measurements - Sched

Fair Value Measurements - Schedule of Major Categories of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - Recurring - USD ($) $ in Thousands	Sep. 30, 2015	Dec. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	$ 20,938	$ 22,714
Asset	41,412	41,898
Liability	5,683	5,310
Put option classified as liability
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liability	3	16
Acquisition–related contingent consideration classified as liability
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liability	5,680	3,374
Warrants classified as liability
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liability	0	1,920
Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	19,778	20,288
U.S. Government bills
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	1,160	2,426
U.S. Government and agency bills
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	20,474	19,184
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	20,938	22,714
Asset	41,412	41,898
Liability	0	0
Level 1 | Put option classified as liability
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liability	0	0
Level 1 | Acquisition–related contingent consideration classified as liability
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liability	0	0
Level 1 | Warrants classified as liability
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liability	0	0
Level 1 | Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	19,778	20,288
Level 1 | U.S. Government bills
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	1,160	2,426
Level 1 | U.S. Government and agency bills
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	20,474	19,184
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Asset	0	0
Liability	0	0
Level 2 | Put option classified as liability
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liability	0	0
Level 2 | Acquisition–related contingent consideration classified as liability
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liability	0	0
Level 2 | Warrants classified as liability
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liability	0	0
Level 2 | Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Level 2 | U.S. Government bills
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Level 2 | U.S. Government and agency bills
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	0	0
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Asset	0	0
Liability	5,683	5,310
Level 3 | Put option classified as liability
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liability	3	16
Level 3 | Acquisition–related contingent consideration classified as liability
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liability	5,680	3,374
Level 3 | Warrants classified as liability
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liability	0	1,920
Level 3 | Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Level 3 | U.S. Government bills
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	0	0
Level 3 | U.S. Government and agency bills
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	$ 0	$ 0

Fair Value Measurements - Sch30

Fair Value Measurements - Schedule of Unobservable Inputs Reconciliation (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2015USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance at beginning of period	$ 5,310
Acquired	0
Changes to liability-classified stock awards	2,964
Settled	0
Conversion of warrants to equity	(5,070)
Net increase in fair value	2,479
Balance at end of period	$ 5,683

Net Loss Per Share - Calculatio

Net Loss Per Share - Calculation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Earnings Per Share [Abstract]
Net loss	$ (6,891)	$ (6,271)	$ (49,831)	$ (9,885)
Basic and diluted shares:
Weighted average common shares outstanding	111,329,917	43,015,151	84,195,227	39,258,879
Net loss per share attributable to common stockholders:
Basic and diluted net loss per share applicable to common stockholders (in dollars per share)	$ (0.06)	$ (0.15)	$ (0.59)	$ (0.25)

Net Loss Per Share - Summary of

Net Loss Per Share - Summary of Shares Excluded from the Calculation of Diluted Net Loss Per Share (Details) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from computation of earnings per share	12,255,795	64,395,151	33,909,306	64,980,429
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from computation of earnings per share	11,904,577	10,743,878	11,914,369	11,329,156
Restricted Stock Units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from computation of earnings per share	148,188	0	60,204	0
Warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from computation of earnings per share	203,030	203,030	203,030	203,030
Convertible preferred stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from computation of earnings per share	0	53,448,243	21,731,703	53,448,243

Segment and Geographic Inform33

Segment and Geographic Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Revenue, Major Customer [Line Items]
Revenue	$ 65,696	$ 47,634	$ 185,604	$ 130,679
United States
Revenue, Major Customer [Line Items]
Revenue	51,593	37,311	145,326	104,119
International
Revenue, Major Customer [Line Items]
Revenue	$ 14,103	$ 10,323	$ 40,278	$ 26,560

Contingencies (Details)

Contingencies (Details) - USD ($) $ in Millions	Sep. 30, 2015	Dec. 31, 2014
Non-income Tax Obligations
Loss Contingencies [Line Items]
Non-income tax obligation reserve	$ 2.6	$ 3.5