Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | ||
Sep. 30, 2013 | Nov. 04, 2013 | Nov. 04, 2013 | |
Class A Common Stock | Class B Common Stock | ||
Document - Document and Entity Information [Line Items] | ' | ' | ' |
Document Type | '10-Q | ' | ' |
Amendment Flag | 'false | ' | ' |
Document Period End Date | 30-Sep-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'Q3 | ' | ' |
Trading Symbol | 'RNG | ' | ' |
Entity Registrant Name | 'RingCentral Inc | ' | ' |
Entity Central Index Key | '0001384905 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Filer Category | 'Non-accelerated Filer | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 8,625,000 | 53,609,008 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $25,452 | $37,864 |
Accounts receivable, net | 2,492 | 2,690 |
Inventory | 2,034 | 833 |
Prepaid expenses and other current assets | 11,656 | 3,408 |
Total current assets | 41,634 | 44,795 |
Property and equipment, net | 17,301 | 17,008 |
Other assets | 1,828 | 1,551 |
Total assets | 60,763 | 63,354 |
Current liabilities: | ' | ' |
Accounts payable | 6,494 | 4,553 |
Accrued liabilities | 20,484 | 21,487 |
Current portion of capital lease obligation | 338 | 312 |
Current portion of long-term debt | 9,617 | 7,636 |
Deferred revenue | 15,573 | 11,291 |
Total current liabilities | 52,506 | 45,279 |
Long-term debt | 27,777 | 12,428 |
Sales tax liability | 4,003 | 3,877 |
Capital lease obligation | 365 | 703 |
Other long-term liabilities | 1,422 | 996 |
Total liabilities | 86,073 | 63,283 |
Commitments and contingencies (Note 5) | ' | ' |
Shareholdersb equity (deficit): | ' | ' |
Common stock | 5 | 2 |
Additional paid-in capital | 91,228 | 9,791 |
Accumulated other comprehensive loss | -154 | -85 |
Accumulated deficit | -116,389 | -83,657 |
Total shareholdersb equity (deficit) | -25,310 | 71 |
Total liabilities and shareholdersb equity (deficit) | 60,763 | 63,354 |
Convertible preferred stock | ' | ' |
Shareholdersb equity (deficit): | ' | ' |
Convertible preferred stock | ' | $74,020 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Revenues: | ' | ' | ' | ' |
Services | $37,925 | $27,290 | $104,669 | $74,989 |
Product | 4,009 | 2,298 | 10,494 | 6,412 |
Total revenues | 41,934 | 29,588 | 115,163 | 81,401 |
Cost of revenues: | ' | ' | ' | ' |
Services | 12,080 | 9,191 | 34,178 | 26,310 |
Product | 3,888 | 2,041 | 10,189 | 6,223 |
Total cost of revenues | 15,968 | 11,232 | 44,367 | 32,533 |
Gross profit | 25,966 | 18,356 | 70,796 | 48,868 |
Operating expenses: | ' | ' | ' | ' |
Research and development | 8,150 | 6,544 | 24,260 | 17,582 |
Sales and marketing | 18,889 | 13,781 | 52,355 | 39,625 |
General and administrative | 7,078 | 7,069 | 24,859 | 19,147 |
Total operating expenses | 34,117 | 27,394 | 101,474 | 76,354 |
Loss from operations | -8,151 | -9,038 | -30,678 | -27,486 |
Other income (expense), net: | ' | ' | ' | ' |
Interest expense | -995 | -553 | -2,222 | -784 |
Other income (expense), net | 348 | 48 | 102 | 20 |
Other income (expense), net | -647 | -505 | -2,120 | -764 |
Loss before provision (benefit) for income taxes | -8,798 | -9,543 | -32,798 | -28,250 |
Provision (benefit) for income taxes | 54 | 25 | -66 | 57 |
Net loss | ($8,852) | ($9,568) | ($32,732) | ($28,307) |
Net loss per common share: | ' | ' | ' | ' |
Basic and diluted | ($0.36) | ($0.43) | ($1.41) | ($1.27) |
Weighted-average number of shares used in computing net loss per share: | ' | ' | ' | ' |
Basic and diluted | 24,452 | 22,372 | 23,290 | 22,273 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Loss (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Statement - Condensed Consolidated Statements of Comprehensive Loss [Line Items] | ' | ' | ' | ' |
Net loss | ($8,852) | ($9,568) | ($32,732) | ($28,307) |
Other comprehensive loss: | ' | ' | ' | ' |
Foreign currency translation adjustments, net | -313 | -71 | -69 | -65 |
Comprehensive loss | ($9,165) | ($9,639) | ($32,801) | ($28,372) |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Cash flows from operating activities: | ' | ' |
Net loss | ($32,732) | ($28,307) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' |
Depreciation and amortization | 6,606 | 4,389 |
Share-based compensation | 4,546 | 1,984 |
Noncash interest and other expense related to warrants issued in connection with debt agreements | 412 | 169 |
Changes in assets and liabilities | ' | ' |
Accounts receivable | 198 | -749 |
Inventory | -1,202 | 435 |
Prepaid expenses and other current assets | -4,340 | -2,123 |
Other assets | -200 | -405 |
Accounts payable | 1,652 | -3,387 |
Accrued liabilities | -366 | 13,175 |
Deferred revenue | 4,283 | 2,226 |
Other liabilities | 553 | 544 |
Net cash used in operating activities | -20,590 | -12,049 |
Cash flows from investing activities: | ' | ' |
Purchases of property and equipment | -9,024 | -6,620 |
Restricted investments | -130 | ' |
Net cash used in investing activities | -9,154 | -6,620 |
Cash flows from financing activities: | ' | ' |
Net proceeds from debt agreements | 22,907 | 24,538 |
Proceeds from preferred stock warrants issued in connection with debt agreements | 1,625 | 501 |
Repayment of debt | -5,928 | -3,039 |
Repayment of capital lease obligations | -312 | -576 |
Payment of deferred initial public offering costs | -1,773 | ' |
Proceeds from exercise of stock options and common stock warrants | 835 | 403 |
Net cash provided by financing activities | 17,354 | 21,827 |
Effect of exchange rate changes on cash and cash equivalents | -22 | -2 |
Net increase (decrease) in cash and cash equivalents | -12,412 | 3,156 |
Beginning of period | 37,864 | 13,577 |
End of period | 25,452 | 16,733 |
Supplemental disclosure of cash flow data: | ' | ' |
Cash paid for interest | 1,187 | 476 |
Cash paid for income taxes | 31 | 54 |
Noncash financing activities: | ' | ' |
Change in liability for unvested exercised options | 95 | 11 |
Issuance of common stock in connection with legal settlement | 257 | ' |
Deferred debt issuance cost recorded in connection with issuance of preferred stock warrants | ' | 122 |
Accrued liability for deferred initial public offering costs | 2,135 | ' |
Conversion of convertible preferred stock into common stock | 74,020 | ' |
Reclassification of preferred stock warrants from liability to equity | 820 | ' |
Equipment purchased and unpaid at period end | 570 | 702 |
Equipment purchased under capital lease | ' | $1,329 |
Description_of_Business_and_Su
Description of Business and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2013 | |
Description of Business and Summary of Significant Accounting Policies | ' |
Note 1. Description of Business and Summary of Significant Accounting Policies | |
Description of Business | |
RingCentral, Inc. (“the Company”) is a provider of software-as-a-service (“SaaS”) solutions for business communications. The Company was incorporated in California in 1999 and was reincorporated in Delaware on September 26, 2013. The Delaware Certificate of Incorporation provides for two classes of common stock upon the effectiveness of our initial public offering (“IPO”): Class A and Class B common stock, both with a par value of $0.0001 per share. Holders of our Class A common stock and Class B common stock have identical rights, however that holders of Class A common stock are entitled to one vote per share of Class A common stock and holders of Class B common stock are entitled to 10 votes per share of Class B common stock on all matters submitted to the stockholders for approval. The shareholders’ equity section of the Company’s condensed consolidated balance sheets have been prepared to conform with Delaware law for all periods presented. The Company is headquartered in San Mateo, California. | |
Initial Public Offering | |
On October 2, 2013, the Company closed its IPO and sold 8,625,000 shares of Class A common stock to the public, including the underwriters’ overallotment option of 1,125,000 shares of Class A common stock and 80,000 shares of Class A common stock sold by selling stockholders, at a price of $13.00 per share. The Company received aggregate proceeds of $103,309,000 from the IPO, net of underwriters’ discounts and commissions, but before deduction of offering expenses of approximately $3,909,000. The net proceeds and other impacts of the IPO described above are not reflected in the condensed consolidated financial statements at September 30, 2013, as the Company received the proceeds following the end of the fiscal quarter. Upon effectiveness of the Company’s registration statement on Form S-1 (the “Registration Statement”) and the filing of the Certificate of Incorporation in Delaware on September 26, 2013, all shares of the Company’s outstanding convertible preferred stock automatically converted into 30,368,527 shares of Class B common stock, and all shares of the Company’s outstanding common stock automatically converted into 23,316,877 shares of Class B common stock, resulting in 53,685,404 total shares of Class B common stock outstanding at September 30, 2013. Immediately following the closing of the IPO, the Company had 8,625,000 shares of Class A common stock and 53,605,404 shares of Class B common stock outstanding. | |
Basis of Presentation | |
The unaudited condensed consolidated financial statements and accompanying notes of the Company reflect all adjustments (all of which are normal and recurring in nature) that, in the opinion of management, are necessary for a fair presentation 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, 2013. Certain information and note disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) have been condensed or omitted under the rules and regulations of the Securities and Exchange Commission (“SEC”). | |
The unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements and related notes presented in the Company’s final prospectus filed with the SEC on September 27, 2013 pursuant to Rule 424(b) of the Securities Act of 1933 (“the final prospectus”). There have been no changes in the Company’s significant accounting policies from those that were disclosed in the Company’s audited consolidated financial statements for the fiscal year ended December 31, 2012 included in the Company’s final prospectus for its IPO. | |
Use of Estimates | |
The preparation of financial statements in conformity with U.S. GAAP requires the Company’s management to make estimates and assumptions 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 significant estimates made by management affect revenue, accounts receivable, the allowance for doubtful accounts, inventory and inventory reserves, share-based compensation, capitalized software development costs, provision for income taxes, uncertain tax positions, loss contingencies and accrued liabilities. Management periodically evaluates such estimates and they are adjusted prospectively based upon such periodic evaluation. Actual results could differ from those estimates. | |
Recent Accounting Pronouncements | |
In February 2013, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. The new guidance requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. This new accounting pronouncement is effective for interim and fiscal reporting periods beginning after December 15, 2012, with early adoption permitted. The Company has adopted this standard during the first quarter of 2013. The adoption of this standard expanded the consolidated financial statement footnote disclosures, however there were no amounts reclassified out of accumulated other comprehensive income in any period presented. | |
In July 2013, the FASB issued ASU No. 2013-11, Income Taxes (Topic 740) Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. The new guidance requires the netting of unrecognized tax benefits (“UTBs”) against a deferred tax asset for a loss or other carryforward that would apply in settlement of the uncertain tax positions. Under the new standard, UTBs will be netted against all available same-jurisdiction loss or other tax carryforwards that would be utilized, rather than only against carryforwards that are created by the UTBs. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. Early adoption is permitted. The Company did not early adopt this pronouncement. The ASU should be applied prospectively to all UTBs that exist at the effective date. Retrospective application is permitted. The Company does not expect the adoption of this guidance to have any significant impact on the Company’s consolidated financial statements. |
Financial_Statement_Components
Financial Statement Components | 9 Months Ended | |||||||||
Sep. 30, 2013 | ||||||||||
Financial Statement Components | ' | |||||||||
Note 2. Financial Statement Components | ||||||||||
Cash and cash equivalents consisted of the following (in thousands): | ||||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
Cash | $ | 13,220 | $ | 3,599 | ||||||
Money market funds | 12,232 | 34,265 | ||||||||
Total cash and cash equivalents | $ | 25,452 | $ | 37,864 | ||||||
Accounts receivable, net consisted of the following (in thousands): | ||||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
Accounts receivable-trade | $ | 1,784 | $ | 2,683 | ||||||
Unbilled accounts receivable-trade | 833 | 440 | ||||||||
Allowance for doubtful accounts | (125 | ) | (433 | ) | ||||||
Accounts receivable, net | $ | 2,492 | $ | 2,690 | ||||||
Prepaid expenses and other current assets consisted of the following (in thousands): | ||||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
Deferred initial public offering costs | $ | 3,909 | $ | - | ||||||
Settlements receivable from credit card transaction processors | 2,535 | 1,626 | ||||||||
Other non-trade receivables from third parties | 2,268 | 24 | ||||||||
Prepaid expenses | 2,656 | 1,596 | ||||||||
Other current assets | 288 | 162 | ||||||||
Total prepaid expenses and other current assets | $ | 11,656 | $ | 3,408 | ||||||
Property and equipment, net consisted of the following (in thousands): | ||||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
Computer hardware and software | $ | 33,402 | $ | 27,292 | ||||||
Furniture and fixtures | 1,090 | 700 | ||||||||
Leasehold improvements | 845 | 441 | ||||||||
Property and equipment, gross | 35,337 | 28,433 | ||||||||
Less: accumulated depreciation | (18,036 | ) | (11,425 | ) | ||||||
Property and equipment, net | $ | 17,301 | $ | 17,008 | ||||||
Accrued liabilities consisted of (in thousands): | ||||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
Accrued compensation and benefits | $ | 4,066 | $ | 3,216 | ||||||
Accrued sales, use and telecom related taxes | 4,399 | 4,580 | ||||||||
Accrued initial public offering costs | 2,100 | - | ||||||||
Accrued expenses | 8,451 | 11,998 | ||||||||
Accrued legal settlements | 750 | 1,075 | ||||||||
Other | 718 | 618 | ||||||||
Total accrued liabilities | $ | 20,484 | $ | 21,487 | ||||||
Fair_Value_of_Financial_Instru
Fair Value of Financial Instruments | 9 Months Ended | |||||||||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||||||||
Fair Value of Financial Instruments | ' | |||||||||||||||||||||||||||||
Note 3. Fair Value of Financial Instruments | ||||||||||||||||||||||||||||||
The Company carries certain financial assets consisting of money market funds and certificates of deposit at fair value on a recurring basis. Fair value is based on the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement: | ||||||||||||||||||||||||||||||
Level 1: Observable inputs which include unadjusted quoted prices in active markets for identical assets or liabilities. | ||||||||||||||||||||||||||||||
Level 2: Observable inputs other than Level 1 inputs, such as quoted prices for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability. | ||||||||||||||||||||||||||||||
Level 3: Unobservable inputs that are supported by little or no market activity and that are based on management’s assumptions, including fair value measurements determined by using pricing models, discounted cash flow methodologies or similar techniques. | ||||||||||||||||||||||||||||||
The fair value of assets carried at fair value was determined using the following inputs (in thousands): | ||||||||||||||||||||||||||||||
Balance at | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||
September 30, 2013 | ||||||||||||||||||||||||||||||
Cash equivalents: | ||||||||||||||||||||||||||||||
Money market funds | $ | 12,232 | $ | 12,232 | $ | — | $ | — | ||||||||||||||||||||||
Other assets: | ||||||||||||||||||||||||||||||
Certificates of deposit | $ | 630 | $ | — | $ | 630 | $ | — | ||||||||||||||||||||||
Balance at | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||
December 31, 2012 | ||||||||||||||||||||||||||||||
Cash equivalents: | ||||||||||||||||||||||||||||||
Money market funds | $ | 34,265 | $ | 34,265 | $ | — | $ | — | ||||||||||||||||||||||
Other assets: | ||||||||||||||||||||||||||||||
Certificates of deposit | $ | 500 | $ | — | $ | 500 | $ | — | ||||||||||||||||||||||
In June 2013 and August 2013, the Company issued preferred stock warrants in connection with debt agreements that were recorded as liabilities at issuance and were carried at fair value through September 26, 2013, the date of the effectiveness of the Registration Statement and the filing of its Certificate of Incorporation in Delaware, after which the fair value of these financial instruments were reclassified to shareholders’ equity. The Company’s preferred stock warrants automatically converted to common stock warrants upon the effectiveness of the Registration Statement and the filing of its Certificate of Incorporation in Delaware on September 26, 2013. The fair value of the warrants at the issuance dates in June 2013 and August 2013 were $265,000 and $495,000, respectively. The fair value of the June 2013 and August 2013 warrants at the date of reclassification were $320,000 and $500,000, respectively. The fair value of preferred stock warrants was determined by the Black-Scholes option pricing model which is a technique using level 3 inputs which are detailed in Note 4. | ||||||||||||||||||||||||||||||
The Company’s other financial instruments, including accounts receivable, accounts payable and other current liabilities, are carried at cost which approximates fair value due to the relatively short maturity of those instruments. Based on borrowing rates available to the Company for loans with similar terms and considering our credit risks, the carrying value of debt approximates fair value. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2013 | |
Debt | ' |
Note 4. Debt | |
Loan and Security Agreement with Bank | |
In February 2009, the Company entered into a loan and security agreement with Silicon Valley Bank (“SVB”) that was last amended in August 2013. Under this agreement the Company borrowed $2,500,000 on a term loan in January 2010 and $8,000,000 on a term loan in March 2012, which was equal to the full final lending commitment. The 2010 term loan was repaid in 30 equal monthly installments of principal and interest, which accrued at an annual fixed rate of 6.5%. In addition, a final terminal payment was made at maturity equal to 3.5% of the original loan principal. The 2010 term loan was repaid in full during the third quarter of 2012. The 2012 term loan is required to be repaid in 36 equal monthly installments of principal plus interest, which accrues at a floating annual rate equal to prime plus 2.75%. In addition, a final terminal payment is due at maturity equal to 0.5% of the original loan principal. | |
In August 2013, the Company entered into an amended loan and security agreement with SVB (the “Amended SVB Credit Agreement”), which provides for a revolving line of credit of up to $15,000,000 and a term loan of up to $5,000,000. The revolving line of credit bears interest at a floating annual rate of prime plus 2.0%, which must be paid monthly, and all outstanding principal and unpaid interest must be repaid by August 13, 2015. The term loan bears interest at a fixed annual rate of 11.0%, which must be paid monthly, and all principal amounts and unpaid interest must be repaid by August 1, 2016, unless the Company voluntarily repays the balance at an earlier date without penalty. A final payment of 2.75% of the amount advanced under the term loan is due upon repayment of this loan at maturity or prepayment of this loan. On August 14, 2013, the Company borrowed $10,778,000 under the revolving line of credit, which represented the full available borrowing capacity on that date. The borrowing limit available under the revolving line of credit increases as the principal balance of the existing $8,000,000 term loan from SVB is repaid subject to limits based on recurring subscription revenue. The Company does not expect this requirement will limit the amount of borrowings available under the line of credit. The existing term loan had an outstanding balance of $4,222,000 on the amendment date. At September 30, 2013, the principal balance and available borrowing capacity of the revolving line of credit were $10,778,000 and $222,000, respectively. On August 16, 2013, the Company borrowed the full $5,000,000 available under the new term loan. | |
In connection with the Amended SVB Credit Agreement, the Company issued SVB warrants to purchase 90,324 shares of its Series E preferred stock at an exercise price of $9.69 per share. As the Series E preferred stock warrants were issued in connection with a loan, the proceeds were allocated to the loan and the warrants based on the relative fair value of the instruments resulting in a loan discount of $866,000 being recorded, with a corresponding increase to additional paid in capital as part of shareholders’ equity. The fair value of the Series E preferred stock warrants was measured at issuance using the Black-Scholes option pricing model with the following assumptions: (i) expected volatility of 60%, (ii) expected life of 10.0 years, (iii) risk free interest rate of 2.7%, (iv) dividend yield of 0.00%, and (v) fair value of Series E preferred stock of $12.86 per share. Upon the effectiveness of the Registration Statement and the filing of its Certificate of Incorporation in Delaware on September 26, 2013, the Series E preferred stock and preferred stock warrants were converted into Class B common stock and warrants to purchase Class B common stock, respectively. | |
The Company has pledged all of its assets, excluding intellectual property, as collateral to secure its obligations under the Amended SVB Credit Agreement. The Amended SVB Credit Agreement contains customary negative covenants that limit the Company’s ability to, among other things, incur additional indebtedness, grant liens, make investments, repurchase stock, pay dividends, transfer assets and merge or consolidate. The Amended SVB Credit Agreement also contains customary affirmative covenants, including requirements to, among other things, (i) maintain minimum cash balances representing the greater of $5,000,000 or two times the Company’s quarterly cash burn rate, as defined in the amended agreement, from and after the IPO, and (ii) deliver audited financial statements. The Company was in compliance with all covenants under its credit agreement with SVB as of September 30, 2013. | |
Loan and Security Agreements with Financial Institution | |
In June 2012, the Company entered into a growth capital loan and security agreement and an equipment loan and security agreement with TriplePoint Capital LLC (“TriplePoint”). Under the growth capital loan and security agreement, the Company borrowed $6,000,000 in term loans in June 2012, equal to the full lending commitment available at the time. The growth capital term loans are required to be repaid in 33 equal monthly installments of principal and interest, which accrues at an annual fixed rate of 8.5% after an interest-only period of three months. In addition, a final terminal payment is due at maturity equal to 4.0% of the original loan principal. Under the equipment loan and security agreement, the Company borrowed $9,691,000 in term loans in August 2012 from the $10,000,000 lending commitment available at the time. The equipment term loans are required to be repaid in 36 equal monthly installments of principal and interest, which accrues at an annual fixed rate of 5.75%. In addition, a final terminal payment is due at maturity equal to 10% of the original loan principal. | |
Under the growth capital loan and security agreement, the Company was permitted to borrow an additional $4,000,000 on or before June 21, 2013 upon the submission of a Form S-1 registration statement to the SEC contemplating an IPO of the Company’s common stock with expected total net proceeds of at least $50,000,000. On June 21, 2013, the Company achieved the milestone necessary to access the additional $4,000,000 available under the original terms of the growth capital loan and security agreement and borrowed $4,000,000 (“growth capital loan part II”). The growth capital loan part II is required to be repaid in 33 equal monthly installments of principal and interest, which accrues at an annual fixed rate of 8.5% after an interest-only period of 3 months, which accrues at a fixed rate of 9.0%. In addition, a final terminal payment is due at maturity equal to 4.0% of the original loan principal. | |
In connection with the growth capital loan part II, the Company issued to TriplePoint a warrant to purchase 33,192 shares of Series D preferred stock with the exercise price set at the lower of: (i) $6.03 per share or (ii) the lowest price per share in the next round of equity financing. As the Series D preferred stock warrants were issued in connection with a loan, the proceeds were allocated to the loan the warrants based on the relative fair value of the instruments resulting in a loan discount of $265,000 being recorded. As a result of the variable exercise price feature, the Series D preferred stock warrants were recorded at fair value and classified as liabilities at issuance, with changes in fair value recognized in other income and expense for the period the warrants remained classified as liabilities. The fair value of the Series D preferred stock warrants was reclassified to shareholders’ equity on September 26, 2013, the date of the effectiveness of the Registration Statement and the filing of its Certificate of Incorporation in Delaware, when the Series D preferred stock and preferred stock warrants were converted into Class B common stock and warrants to purchase Class B common stock, respectively. The fair value of the Series D preferred stock warrants was measured at issuance using the Black-Scholes option pricing model with the following assumptions: (i) expected volatility of 55%, (ii) expected life of 7.0 years, (iii) risk free interest rate of 1.9%, (iv) dividend yield of 0.00%, and (v) fair value of Series D preferred stock of $11.41 per share. | |
In August 2013, the Company amended the growth capital loan and security agreement with TriplePoint to provide an additional $5,000,000 term loan (“growth capital loan part III”). In September 2013, the Company entered into a second amendment to the growth capital loan facility to adjust the repayment terms such that the term loan is required to be paid over 36 months as follows: 36 months of interest-only payments at a fixed annual rate of 11.0% and the loan principal at maturity. In addition, a final payment of 2.75% of the original principal amount is due at maturity, which is August 13, 2016, or upon prepayment of this loan. On August 19, 2013, the Company borrowed the full $5,000.000 available under this term loan. | |
In connection with growth capital loan part III, the Company issued to TriplePoint a warrant to purchase 51,614 shares of Series E preferred stock at an exercise price set at the lower of: (i) $9.69 per share or (ii) the lowest price per share in the next round of equity financing. As the Series E preferred stock warrants were issued in connection with a loan, the proceeds were allocated to the loan and the warrants based on the relative fair value of the instruments resulting in a loan discount of $495,000 being recorded. As a result of the variable exercise price feature, the Series E preferred stock warrants were recorded at fair value and classified as liabilities at issuance, with changes in fair value recognized in other income and expense for the period the warrants remained classified as liabilities. The fair value of the Series E preferred stock warrants was reclassified to shareholders’ equity on September 26, 2013, the date of the effectiveness of the Registration Statement and the filing of its Certificate of Incorporation in Delaware, when the Series E preferred stock and preferred stock warrants were converted into Class B common stock and warrants to purchase Class B common stock, respectively. The fair value of the Series E preferred stock warrants was measured at issuance using the Black-Scholes option pricing model with the following assumptions: (i) expected volatility of 60%, (ii) expected life of 10.0 years, (iii) risk free interest rate of 2.7%, (iv) dividend yield of 0.00%, and (v) fair value of Series E preferred stock of $12.86 per share. | |
The TriplePoint growth capital loan and security agreement, as amended and equipment loan and security agreement contain customary negative covenants that limit the Company’s ability to, among other things, incur additional indebtedness, grant liens, make investments, repurchase stock, pay dividends, transfer assets and merge or consolidate. The TriplePoint growth capital loan and security agreement, as amended and equipment loan and security agreement also contain customary affirmative covenants, including requirements to, among other things, deliver audited financial statements. The Company was in compliance with all covenants under its credit agreements with TriplePoint as of September 30, 2013. | |
Other Debt | |
In April 2012, the Company borrowed $1,500,000 to finance the purchase of software. The loan is required to be repaid in three equal installments of $500,000 due in April 2012, January 2013 and January 2014. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingencies | ' |
Note 5. Commitments and Contingencies | |
Sales Tax Liability | |
During 2010 and 2011, the Company increased its sales and marketing activities in the U.S., which may be asserted by a number of states to create an obligation under nexus regulations to collect sales taxes on sales to customers in the state. Prior to 2012, the Company did not collect sales taxes from customers on sales in all states. In the second quarter of 2012, the Company commenced collecting and remitting sales taxes on sales in all states, therefore the loss contingency is applicable to sales and marketing activities in 2010, 2011 and the six months ended June 30, 2012. As of September 30, 2013 and December 31, 2012, the Company recorded a long-term sales tax liability of $4,003,000 and $3,877,000, respectively, based on its best estimate of the probable liability for the loss contingency incurred as of those dates. The Company’s estimate of a probable outcome under the loss contingency is based on analysis of its sales and marketing activities, revenues subject to sales tax, and applicable regulations in each state in each period. No significant adjustments to the long-term sales tax liability have been recognized in the accompanying consolidated financial statements for changes to the assumptions underlying the estimate. However, changes in management’s assumptions may occur in the future as the Company obtains new information which can result in adjustments to the recorded liability. Increases and decreases to the long-term sales tax liability are recorded as general and administrative expense. | |
A current sales tax liability for noncontingent amounts expected to be remitted in the next twelve months of, $2,973,000 and $3,574,000, is included in accrued liabilities as of September 30, 2013 and December 31, 2012, respectively. | |
Legal Matters | |
In December 2012, CallWave Communications, LLC (“Callwave”) filed a lawsuit against the Company in the United States District Court for the District of Delaware and amended its complaint twice since then alleging patent infringement by the Company and AT&T Inc. (“AT&T”), a reseller of the Company’s product and services, seeking damages but no injunction. | |
On September 27, 2013, the Company entered into a settlement agreement with CallWave. Under the terms of the settlement, CallWave granted a non-exclusive license to the Company and agreed to dismiss all claims in the litigation with prejudice, including any claims for which the Company was required to indemnify and defend AT&T. As part of the settlement, the Company agreed to pay CallWave cash consideration which it recognized as general and administrative expense during the second quarter of 2013 as it determined the payment to be a cost to settle a loss contingency, and the amount was probable and estimable. During the third quarter of 2013, the Company paid substantially all of the cash consideration due under the settlement agreement and recorded a credit to general and administrative expense of $1,160,000 to reflect the final cost of the settlement net of insurance recovery. |
ShareBased_Compensation
Share-Based Compensation | 9 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Share-Based Compensation | ' | ||||||||||||||||||||||||
Note 6. Share-Based Compensation | |||||||||||||||||||||||||
A summary of share-based compensation expense recognized in the Company’s consolidated statements of operations follows (in thousands): | |||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||
Cost of services revenues | $ | 129 | $ | 66 | $ | 297 | $ | 175 | |||||||||||||||||
Research and development | 367 | 223 | 884 | 536 | |||||||||||||||||||||
Sales and marketing | 330 | 153 | 734 | 483 | |||||||||||||||||||||
General and administrative | 1,384 | 327 | 2,631 | 790 | |||||||||||||||||||||
Total share-based compensation expense | $ | 2,210 | $ | 769 | $ | 4,546 | $ | 1,984 | |||||||||||||||||
As of September 30, 2013 and December 31, 2012, there was approximately $23,277,000 and $9,587,000 and of nonvested share-based compensation expense, net of estimated forfeitures, related to stock option grants, which will be recognized on a straight-line basis over the remaining weighted-average vesting periods of approximately 3.0 years and 2.7 years, respectively. | |||||||||||||||||||||||||
Equity Incentive Plans | |||||||||||||||||||||||||
In September 2013, the Board adopted and the Company’s stockholder approved the 2013 Equity Incentive Plan (the “2013 Plan”). The 2013 Plan became effective on September 26, 2013. In connection with the adoption of the 2013 Plan, the Company terminated the 2010 Equity Incentive Plan (the “2010 Plan”), under which stock options had been granted prior to September 26, 2013. The 2010 Plan was established in September 2010, when the 2003 Equity Incentive Plan (the “2003 Plan”) was terminated. After the termination of the 2003 and 2010 Plans, no additional options were granted under these plans; however options previously granted will continue to be governed by these plans. In addition, options authorized to be granted under the 2003 and 2010 Plans, including forfeitures of previously granted awards are authorized for grant under the 2013 Plan. A total of 6,200,000 shares of Class A common stock have been reserved for issuance under the 2013 Plan. The 2013 Plan includes an annual increase on the first day of each fiscal year beginning in 2014, equal to the least of: (i) 6,200,000 shares of Class A common stock; (ii) 5.0% of the outstanding shares of all classes of common stock as of the last day of the Company’s immediately preceding fiscal year; or (iii) such other amount as the board of directors may determine. | |||||||||||||||||||||||||
The plans permit the grant of stock options and other share-based awards to employees, officers, directors and consultants by the Company’s board of directors. Option awards are generally granted with an exercise price equal to the fair market value of the Company’s common stock as determined by the Company’s board of directors at the date of grant. Option awards generally vest according to a graded vesting schedule based on four years of continuous service and generally have a 10-year contractual term. Certain option awards provide for accelerated vesting if there is a change in control (as defined in the option agreement) and early exercise of the option prior to vesting (subject to the Company’s repurchase right). As of September 30, 2013 a total of 6,166,350 shares remain available for grant under the 2013 Plan. As of December 31, 2012, a total of 468,000 shares were available for grant under the 2010 Plan, which was terminated in September 2013 upon the adoption of the 2013 Plan. | |||||||||||||||||||||||||
A summary of option activity under all of the plans at September 30, 2013 and changes during the periods then ended is presented in the following table (in thousands): | |||||||||||||||||||||||||
Number of | Weighted- | Weighted- | Aggregate | ||||||||||||||||||||||
Options | Average | Average | Intrinsic | ||||||||||||||||||||||
Outstanding | Exercise Price | Contractual | Value | ||||||||||||||||||||||
(in thousands) | Per Share | Term | (in thousands) | ||||||||||||||||||||||
(in Years) | |||||||||||||||||||||||||
Outstanding at December 31, 2012 | 8,609 | $ | 2.89 | 7.2 | $ | 40,705 | |||||||||||||||||||
Granted | 3,701 | 11.30 | 0 | ||||||||||||||||||||||
Exercised | (593 | ) | 1.42 | 0 | |||||||||||||||||||||
Canceled/Forfeited | (632 | ) | 4.16 | 0 | |||||||||||||||||||||
Outstanding at September 30, 2013 | 11,085 | $ | 5.71 | 8.0 | $ | 136,491 | |||||||||||||||||||
Vested and expected to vest as of September 30, 2013 | 10,147 | $ | 5.38 | 7.8 | $ | 128,249 | |||||||||||||||||||
Exercisable as of September 30, 2013 | 4,612 | $ | 2.06 | 6.3 | $ | 73,610 | |||||||||||||||||||
The weighted average grant date fair value of options granted and the total intrinsic value of options exercised were as follows (in thousands, except weighted average grant date fair value): | |||||||||||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Weighted average grant date fair value per share | $ | 6.08 | $ | 3.05 | |||||||||||||||||||||
Total intrinsic value of options exercised | $ | 9,855 | $ | 1,591 | |||||||||||||||||||||
The Company estimated the fair values of each option awarded on the date of grant using the Black-Scholes option pricing model, which requires inputs including the fair value of common stock, expected term, expected volatility, risk-free interest and dividend yield. The weighted-average assumptions used in the option pricing models and the resulting grant date fair value of stock options granted to employees and non-employees in the periods presented were as follows: | |||||||||||||||||||||||||
Three Months | Nine Months | ||||||||||||||||||||||||
Ended September 30, | Ended September 30, | ||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||
Expected term for employees (in years) | 6.1 | 6.1 | 6.1 | 6.1 | |||||||||||||||||||||
Expected term for non-employees (in years) | 10.0 | 10.0 | 10.0 | 10.0 | |||||||||||||||||||||
Risk-free interest rate | 1.99 | % | 0.84 | % | 1.68 | % | 0.96 | % | |||||||||||||||||
Expected volatility | 54 | % | 57 | % | 54 | % | 61 | % | |||||||||||||||||
Expected dividend rate | 0 | % | 0 | % | 0 | % | 0 | % | |||||||||||||||||
Early Exercises of Nonvested Options | |||||||||||||||||||||||||
The Company’s option agreements with certain employees permit the early exercise of nonvested stock options. The Company has the right to repurchase issued but nonvested shares of common stock at the original exercise price following the termination of service. The shares are released from the repurchase right according to the vesting schedule specified in the option agreement. The Company treats the proceeds from early exercise as a deposit of the exercise price and records the cash received initially as a liability that is reclassified to shareholders’ equity as the shares vest. | |||||||||||||||||||||||||
A summary of the status of the Company’s early exercised and nonvested shares as of December 31, 2012 and September 30, 2013, and changes during the periods then ended is presented below (in thousands): | |||||||||||||||||||||||||
Number of | Nonvested | ||||||||||||||||||||||||
Shares | Common Stock | ||||||||||||||||||||||||
Liability | |||||||||||||||||||||||||
Nonvested as of December 31, 2011 | 58 | $ | 64 | ||||||||||||||||||||||
Early exercises | 100 | 200 | |||||||||||||||||||||||
Vested | (58 | ) | (60 | ) | |||||||||||||||||||||
Nonvested as of December 31, 2012 | 100 | 204 | |||||||||||||||||||||||
Early exercises | — | — | |||||||||||||||||||||||
Vested | (51 | ) | (98 | ) | |||||||||||||||||||||
Nonvested as of September 30, 2013 | 49 | 106 | |||||||||||||||||||||||
Employee Stock Purchase Plan | |||||||||||||||||||||||||
In September 2013, the Board adopted, and the Company’s stockholder approved a 2013 Employee Stock Purchase Plan (ESPP). The ESPP became effective on September 26, 2013. A total of 1,250,000 shares of Class A common stock have been reserved for issuance under the ESPP. The ESPP provides for annual increases in the number of shares available for issuance under the ESPP on the first day of each fiscal year beginning in fiscal 2013, equal to the least of: (i) 1% of the outstanding shares of all classes of common stock on the last day of the immediately preceding year; (ii) 1,250,000 shares; or (iii) such other amount as may be determined by the board of directors. | |||||||||||||||||||||||||
The ESPP allows eligible employees to purchase shares of the Class A common stock at a discount through payroll deductions of up to the lesser of 15% of their eligible compensation or $25,000 per calendar year, at not less than 90% of the fair market value, as defined in the ESPP, subject to any plan limitations. A participant may purchase a maximum of 3,000 shares during an offering period. The offering period generally starts on the first trading day on or after May 11th and November 11th of each year, except that the first offering period commenced on the first trading day following the effective date of the Company’s registration statement. At the end of the offering period, the purchase price is set at the lower of: (i) the fair value of the Company’s common stock at the beginning of the six month offering period, and (ii) the fair value of the Company’s common stock at the end of the six month offering period. At September 30, 2013, a total of 1,250,000 shares were available for issuance under the ESPP. | |||||||||||||||||||||||||
The assumptions used to value employee stock purchase rights under the Black-Scholes model during the three and nine months ended September 30, 2013 were as follows: | |||||||||||||||||||||||||
Expected term (in months) | 6 | ||||||||||||||||||||||||
Risk-free interest rate | 0.03 | % | |||||||||||||||||||||||
Expected volatility | 42 | % | |||||||||||||||||||||||
Expected dividend rate | 0 | % | |||||||||||||||||||||||
Geographic_Concentrations
Geographic Concentrations | 9 Months Ended |
Sep. 30, 2013 | |
Geographic Concentrations | ' |
Note 7. Geographic Concentrations | |
Revenue by geographic location is based on the billing address of the customer. More than 90% of the Company’s revenue is from the United States during the three and nine months ended September 30, 2013 and 2012. No other individual country exceeded 10% of total revenue during the three and nine months ended September 30, 2013 and 2012. Property and equipment by geographic location is based on the location of the legal entity that owns the asset. At September 30, 2013 and December 31, 2012, more than 85% and 95%, respectively, of the Company’s property and equipment is located in the United States, with no single country outside the United States representing more than 10% of property and equipment individually during the three and nine months ended September 30, 2013 and 2012. |
Income_Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2013 | |
Income Taxes | ' |
Note 8. Income Taxes | |
The provision for income taxes for the three months ended September 30, 2013 and 2012, was approximately $54,000 and $25,000, respectively. The provision for income taxes consisted primarily of foreign income taxes. | |
The (benefit) provisions for income taxes for the nine months ended September 30, 2013 and 2012 were approximately $(66,000) and $57,000, respectively. The benefit for income taxes during the nine months ended September 30, 2013 consisted of foreign income taxes, state minimum taxes and recognition of a foreign tax credit related to its subsidiary in China. The provision for income taxes during the nine months ended September 30, 2012 consisted primarily of state minimum taxes and foreign income taxes. | |
For the three and nine months ended September 30, 2013 and 2012, the provision for income taxes differed from the statutory amount primarily due to state and foreign taxes currently payable, and the Company realized no benefit for current year losses due to maintaining a full valuation allowance against the U.S. and foreign net deferred tax assets. | |
The realization of tax benefits of deferred tax assets is dependent upon future levels of taxable income, of an appropriate character, in the periods the items are expected to be deductible or taxable. Based on the available objective evidence, the Company does not believe it is more likely than not that the net deferred tax assets will be realizable. Accordingly, the Company has provided a full valuation allowance against the domestic and foreign net deferred tax assets as of September 30, 2013 and December 31, 2012. The Company intends to maintain the remaining valuation allowance until sufficient positive evidence exists to support a reversal of, or decrease in, the valuation allowance. During the three and nine months ended September 30, 2013, there have been no material changes to the total amount of unrecognized tax benefits. |
Basic_and_Diluted_Net_Loss_Per
Basic and Diluted Net Loss Per Share | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||
Basic and Diluted Net Loss Per Share | ' | ||||||||||||||||||||
Note 9. Basic and Diluted Net Loss Per Share | |||||||||||||||||||||
Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period, less the weighted-average unvested common stock subject to repurchase or forfeiture as they are not deemed to be issued for accounting purposes. Diluted net loss per share is computed by giving effect to all potential shares of common stock, including preferred stock, warrants to exercise common and preferred stock and stock options, to the extent they are dilutive. Upon the effectiveness of the Registration Statement and the filing of its Certificate of Incorporation in Delaware on September 26, 2013, all outstanding preferred stock and warrants to purchase preferred stock were converted to common stock and warrants to purchase common stock, respectively. For the three and nine months ended September 30, 2013 and 2012, all such common stock equivalents have been excluded from diluted net loss per share as the effect to net loss per share would be anti-dilutive. | |||||||||||||||||||||
The following table sets forth the computation of the Company’s basic and diluted net loss per share of common stock (in thousands, except per share data): | |||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Numerator | |||||||||||||||||||||
Net loss | $ | (8,852 | ) | $ | (9,568 | ) | $ | (32,732 | ) | $ | (28,307 | ) | |||||||||
Denominator | |||||||||||||||||||||
Weighted-average common shares for basic and diluted net loss per share | 24,452 | 22,372 | 23,290 | 22,273 | |||||||||||||||||
Basic and diluted net loss per share | $ | (0.36 | ) | $ | (0.43 | ) | $ | (1.41 | ) | $ | (1.27 | ) | |||||||||
The following table sets forth the potential shares of common stock that were excluded from diluted weighted-average common shares outstanding (in thousands): | |||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Shares of common stock issuable upon conversion of preferred stock | — | 27,272 | — | 27,272 | |||||||||||||||||
Shares of common stock issuable upon conversion of warrants | 502 | 337 | 502 | 337 | |||||||||||||||||
Shares of common stock subject to repurchase | 49 | 110 | 49 | 110 | |||||||||||||||||
Shares of common stock issuable under stock option plans outstanding | 11,085 | 8,726 | 11,085 | 8,726 | |||||||||||||||||
Potential common shares excluded from diluted net loss per share | 11,636 | 36,445 | 11,636 | 36,445 | |||||||||||||||||
The table above does not include shares recently issued upon the completion of the IPO. |
Subsequent_Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2013 | |
Subsequent Events | ' |
Note 10. Subsequent Events | |
On October 2, 2013, the Company completed its IPO whereby 8,625,000 shares of Class A common stock were sold to the public, including the underwriters’ overallotment option of 1,125,000 shares of Class A common stock and 80,000 shares of Class A common stock sold by selling stockholders, at a price of $13.00 per share. The Company received aggregate proceeds of $103,309,000 from the IPO, net of underwriters’ discounts and commissions, but before deduction of offering expenses of approximately $3,909,000. | |
The Company has evaluated subsequent events through November 12, 2013, the date the condensed consolidated financial statements were issued. |
Description_of_Business_and_Su1
Description of Business and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Initial Public Offering | ' |
Initial Public Offering | |
On October 2, 2013, the Company closed its IPO and sold 8,625,000 shares of Class A common stock to the public, including the underwriters’ overallotment option of 1,125,000 shares of Class A common stock and 80,000 shares of Class A common stock sold by selling stockholders, at a price of $13.00 per share. The Company received aggregate proceeds of $103,309,000 from the IPO, net of underwriters’ discounts and commissions, but before deduction of offering expenses of approximately $3,909,000. The net proceeds and other impacts of the IPO described above are not reflected in the condensed consolidated financial statements at September 30, 2013, as the Company received the proceeds following the end of the fiscal quarter. Upon effectiveness of the Company’s registration statement on Form S-1 (the “Registration Statement”) and the filing of the Certificate of Incorporation in Delaware on September 26, 2013, all shares of the Company’s outstanding convertible preferred stock automatically converted into 30,368,527 shares of Class B common stock, and all shares of the Company’s outstanding common stock automatically converted into 23,316,877 shares of Class B common stock, resulting in 53,685,404 total shares of Class B common stock outstanding at September 30, 2013. Immediately following the closing of the IPO, the Company had 8,625,000 shares of Class A common stock and 53,605,404 shares of Class B common stock outstanding. | |
Basis of Presentation | ' |
Basis of Presentation | |
The unaudited condensed consolidated financial statements and accompanying notes of the Company reflect all adjustments (all of which are normal and recurring in nature) that, in the opinion of management, are necessary for a fair presentation 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, 2013. Certain information and note disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) have been condensed or omitted under the rules and regulations of the Securities and Exchange Commission (“SEC”). | |
The unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements and related notes presented in the Company’s final prospectus filed with the SEC on September 27, 2013 pursuant to Rule 424(b) of the Securities Act of 1933 (“the final prospectus”). There have been no changes in the Company’s significant accounting policies from those that were disclosed in the Company’s audited consolidated financial statements for the fiscal year ended December 31, 2012 included in the Company’s final prospectus for its IPO. | |
Use of Estimates | ' |
Use of Estimates | |
The preparation of financial statements in conformity with U.S. GAAP requires the Company’s management to make estimates and assumptions 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 significant estimates made by management affect revenue, accounts receivable, the allowance for doubtful accounts, inventory and inventory reserves, share-based compensation, capitalized software development costs, provision for income taxes, uncertain tax positions, loss contingencies and accrued liabilities. Management periodically evaluates such estimates and they are adjusted prospectively based upon such periodic evaluation. Actual results could differ from those estimates. | |
Recent Accounting Pronouncements | ' |
Recent Accounting Pronouncements | |
In February 2013, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. The new guidance requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. This new accounting pronouncement is effective for interim and fiscal reporting periods beginning after December 15, 2012, with early adoption permitted. The Company has adopted this standard during the first quarter of 2013. The adoption of this standard expanded the consolidated financial statement footnote disclosures, however there were no amounts reclassified out of accumulated other comprehensive income in any period presented. | |
In July 2013, the FASB issued ASU No. 2013-11, Income Taxes (Topic 740) Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. The new guidance requires the netting of unrecognized tax benefits (“UTBs”) against a deferred tax asset for a loss or other carryforward that would apply in settlement of the uncertain tax positions. Under the new standard, UTBs will be netted against all available same-jurisdiction loss or other tax carryforwards that would be utilized, rather than only against carryforwards that are created by the UTBs. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. Early adoption is permitted. The Company did not early adopt this pronouncement. The ASU should be applied prospectively to all UTBs that exist at the effective date. Retrospective application is permitted. The Company does not expect the adoption of this guidance to have any significant impact on the Company’s consolidated financial statements. |
Financial_Statement_Components1
Financial Statement Components (Tables) | 9 Months Ended | |||||||||
Sep. 30, 2013 | ||||||||||
Components of Cash and Cash Equivalents | ' | |||||||||
Cash and cash equivalents consisted of the following (in thousands): | ||||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
Cash | $ | 13,220 | $ | 3,599 | ||||||
Money market funds | 12,232 | 34,265 | ||||||||
Total cash and cash equivalents | $ | 25,452 | $ | 37,864 | ||||||
Components of Accounts Receivable, Net | ' | |||||||||
Accounts receivable, net consisted of the following (in thousands): | ||||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
Accounts receivable-trade | $ | 1,784 | $ | 2,683 | ||||||
Unbilled accounts receivable-trade | 833 | 440 | ||||||||
Allowance for doubtful accounts | (125 | ) | (433 | ) | ||||||
Accounts receivable, net | $ | 2,492 | $ | 2,690 | ||||||
Components of Prepaid Expenses and Other Current Assets | ' | |||||||||
Prepaid expenses and other current assets consisted of the following (in thousands): | ||||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
Deferred initial public offering costs | $ | 3,909 | $ | - | ||||||
Settlements receivable from credit card transaction processors | 2,535 | 1,626 | ||||||||
Other non-trade receivables from third parties | 2,268 | 24 | ||||||||
Prepaid expenses | 2,656 | 1,596 | ||||||||
Other current assets | 288 | 162 | ||||||||
Total prepaid expenses and other current assets | $ | 11,656 | $ | 3,408 | ||||||
Components of Property and Equipment, Net | ' | |||||||||
Property and equipment, net consisted of the following (in thousands): | ||||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
Computer hardware and software | $ | 33,402 | $ | 27,292 | ||||||
Furniture and fixtures | 1,090 | 700 | ||||||||
Leasehold improvements | 845 | 441 | ||||||||
Property and equipment, gross | 35,337 | 28,433 | ||||||||
Less: accumulated depreciation | (18,036 | ) | (11,425 | ) | ||||||
Property and equipment, net | $ | 17,301 | $ | 17,008 | ||||||
Components of Accrued Liabilities | ' | |||||||||
Accrued liabilities consisted of (in thousands): | ||||||||||
September 30, | December 31, | |||||||||
2013 | 2012 | |||||||||
Accrued compensation and benefits | $ | 4,066 | $ | 3,216 | ||||||
Accrued sales, use and telecom related taxes | 4,399 | 4,580 | ||||||||
Accrued initial public offering costs | 2,100 | - | ||||||||
Accrued expenses | 8,451 | 11,998 | ||||||||
Accrued legal settlements | 750 | 1,075 | ||||||||
Other | 718 | 618 | ||||||||
Total accrued liabilities | $ | 20,484 | $ | 21,487 | ||||||
Fair_Value_of_Financial_Instru1
Fair Value of Financial Instruments (Tables) | 9 Months Ended | |||||||||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||||||||
Fair Value of Assets Carried at Fair Value | ' | |||||||||||||||||||||||||||||
The fair value of assets carried at fair value was determined using the following inputs (in thousands): | ||||||||||||||||||||||||||||||
Balance at | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||
September 30, 2013 | ||||||||||||||||||||||||||||||
Cash equivalents: | ||||||||||||||||||||||||||||||
Money market funds | $ | 12,232 | $ | 12,232 | $ | — | $ | — | ||||||||||||||||||||||
Other assets: | ||||||||||||||||||||||||||||||
Certificates of deposit | $ | 630 | $ | — | $ | 630 | $ | — | ||||||||||||||||||||||
Balance at | (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||||||||||
December 31, 2012 | ||||||||||||||||||||||||||||||
Cash equivalents: | ||||||||||||||||||||||||||||||
Money market funds | $ | 34,265 | $ | 34,265 | $ | — | $ | — | ||||||||||||||||||||||
Other assets: | ||||||||||||||||||||||||||||||
Certificates of deposit | $ | 500 | $ | — | $ | 500 | $ | — | ||||||||||||||||||||||
ShareBased_Compensation_Tables
Share-Based Compensation (Tables) | 9 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Summary of Share-Based Compensation Expense Recognized to Statements of Operations | ' | ||||||||||||||||||||||||
A summary of share-based compensation expense recognized in the Company’s consolidated statements of operations follows (in thousands): | |||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||
Cost of services revenues | $ | 129 | $ | 66 | $ | 297 | $ | 175 | |||||||||||||||||
Research and development | 367 | 223 | 884 | 536 | |||||||||||||||||||||
Sales and marketing | 330 | 153 | 734 | 483 | |||||||||||||||||||||
General and administrative | 1,384 | 327 | 2,631 | 790 | |||||||||||||||||||||
Total share-based compensation expense | $ | 2,210 | $ | 769 | $ | 4,546 | $ | 1,984 | |||||||||||||||||
Summary of Stock Option Activity Plans | ' | ||||||||||||||||||||||||
A summary of option activity under all of the plans at September 30, 2013 and changes during the periods then ended is presented in the following table (in thousands): | |||||||||||||||||||||||||
Number of | Weighted- | Weighted- | Aggregate | ||||||||||||||||||||||
Options | Average | Average | Intrinsic | ||||||||||||||||||||||
Outstanding | Exercise Price | Contractual | Value | ||||||||||||||||||||||
(in thousands) | Per Share | Term | (in thousands) | ||||||||||||||||||||||
(in Years) | |||||||||||||||||||||||||
Outstanding at December 31, 2012 | 8,609 | $ | 2.89 | 7.2 | $ | 40,705 | |||||||||||||||||||
Granted | 3,701 | 11.30 | 0 | ||||||||||||||||||||||
Exercised | (593 | ) | 1.42 | 0 | |||||||||||||||||||||
Canceled/Forfeited | (632 | ) | 4.16 | 0 | |||||||||||||||||||||
Outstanding at September 30, 2013 | 11,085 | $ | 5.71 | 8.0 | $ | 136,491 | |||||||||||||||||||
Vested and expected to vest as of September 30, 2013 | 10,147 | $ | 5.38 | 7.8 | $ | 128,249 | |||||||||||||||||||
Exercisable as of September 30, 2013 | 4,612 | $ | 2.06 | 6.3 | $ | 73,610 | |||||||||||||||||||
Weighted Average Grant Date Fair Value of Options Granted and Total Intrinsic Value of Options Exercised | ' | ||||||||||||||||||||||||
The weighted average grant date fair value of options granted and the total intrinsic value of options exercised were as follows (in thousands, except weighted average grant date fair value): | |||||||||||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||||||
Weighted average grant date fair value per share | $ | 6.08 | $ | 3.05 | |||||||||||||||||||||
Total intrinsic value of options exercised | $ | 9,855 | $ | 1,591 | |||||||||||||||||||||
Weighted Average Assumptions Used to Fair Value of Stock Options Granted | ' | ||||||||||||||||||||||||
The Company estimated the fair values of each option awarded on the date of grant using the Black-Scholes option pricing model, which requires inputs including the fair value of common stock, expected term, expected volatility, risk-free interest and dividend yield. The weighted-average assumptions used in the option pricing models and the resulting grant date fair value of stock options granted to employees and non-employees in the periods presented were as follows: | |||||||||||||||||||||||||
Three Months | Nine Months | ||||||||||||||||||||||||
Ended September 30, | Ended September 30, | ||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||||
Expected term for employees (in years) | 6.1 | 6.1 | 6.1 | 6.1 | |||||||||||||||||||||
Expected term for non-employees (in years) | 10.0 | 10.0 | 10.0 | 10.0 | |||||||||||||||||||||
Risk-free interest rate | 1.99 | % | 0.84 | % | 1.68 | % | 0.96 | % | |||||||||||||||||
Expected volatility | 54 | % | 57 | % | 54 | % | 61 | % | |||||||||||||||||
Expected dividend rate | 0 | % | 0 | % | 0 | % | 0 | % | |||||||||||||||||
Summary of Status of Nonvested Shares Activity | ' | ||||||||||||||||||||||||
A summary of the status of the Company’s early exercised and nonvested shares as of December 31, 2012 and September 30, 2013, and changes during the periods then ended is presented below (in thousands): | |||||||||||||||||||||||||
Number of | Nonvested | ||||||||||||||||||||||||
Shares | Common Stock | ||||||||||||||||||||||||
Liability | |||||||||||||||||||||||||
Nonvested as of December 31, 2011 | 58 | $ | 64 | ||||||||||||||||||||||
Early exercises | 100 | 200 | |||||||||||||||||||||||
Vested | (58 | ) | (60 | ) | |||||||||||||||||||||
Nonvested as of December 31, 2012 | 100 | 204 | |||||||||||||||||||||||
Early exercises | — | — | |||||||||||||||||||||||
Vested | (51 | ) | (98 | ) | |||||||||||||||||||||
Nonvested as of September 30, 2013 | 49 | 106 | |||||||||||||||||||||||
Summary of Assumptions Used to Value Employee Stock Purchase Rights Under the Black-Scholes Model | ' | ||||||||||||||||||||||||
The assumptions used to value employee stock purchase rights under the Black-Scholes model during the three and nine months ended September 30, 2013 were as follows: | |||||||||||||||||||||||||
Expected term (in months) | 6 | ||||||||||||||||||||||||
Risk-free interest rate | 0.03 | % | |||||||||||||||||||||||
Expected volatility | 42 | % | |||||||||||||||||||||||
Expected dividend rate | 0 | % | |||||||||||||||||||||||
Basic_and_Diluted_Net_Loss_Per1
Basic and Diluted Net Loss Per Share (Tables) | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||
Computation of Company's Basic and Diluted Net Loss Per Share of Common Stock | ' | ||||||||||||||||||||
The following table sets forth the computation of the Company’s basic and diluted net loss per share of common stock (in thousands, except per share data): | |||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Numerator | |||||||||||||||||||||
Net loss | $ | (8,852 | ) | $ | (9,568 | ) | $ | (32,732 | ) | $ | (28,307 | ) | |||||||||
Denominator | |||||||||||||||||||||
Weighted-average common shares for basic and diluted net loss per share | 24,452 | 22,372 | 23,290 | 22,273 | |||||||||||||||||
Basic and diluted net loss per share | $ | (0.36 | ) | $ | (0.43 | ) | $ | (1.41 | ) | $ | (1.27 | ) | |||||||||
Potential Shares of Common Stock Excluded from Diluted Weighted-Average Common Shares Outstanding | ' | ||||||||||||||||||||
The following table sets forth the potential shares of common stock that were excluded from diluted weighted-average common shares outstanding (in thousands): | |||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Shares of common stock issuable upon conversion of preferred stock | — | 27,272 | — | 27,272 | |||||||||||||||||
Shares of common stock issuable upon conversion of warrants | 502 | 337 | 502 | 337 | |||||||||||||||||
Shares of common stock subject to repurchase | 49 | 110 | 49 | 110 | |||||||||||||||||
Shares of common stock issuable under stock option plans outstanding | 11,085 | 8,726 | 11,085 | 8,726 | |||||||||||||||||
Potential common shares excluded from diluted net loss per share | 11,636 | 36,445 | 11,636 | 36,445 | |||||||||||||||||
Description_of_Business_and_Su2
Description of Business and Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 9 Months Ended | 1 Months Ended | 1 Months Ended | ||||||
Sep. 30, 2013 | Oct. 02, 2013 | Sep. 30, 2013 | Oct. 02, 2013 | Oct. 02, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 26, 2013 | Sep. 26, 2013 | |
Class A common stock | Class A common stock | Class A common stock | Class B Common Stock | Class B Common Stock | Class B Common Stock | Class B Common Stock | Class B Common Stock | ||
Subsequent Event | Initial Public Offering | Initial Public Offering | Initial Public Offering | ||||||
Initial Public Offering | Convertible preferred stock | Common Stock | |||||||
Disclosure - Description of Business and Summary of Significant Accounting Policies - Additional Information (Detail) [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock, par value | ' | ' | $0.00 | ' | ' | $0.00 | ' | ' | ' |
Common stock, voting right description | 'Holders of our Class A common stock and Class B common stock have identical rights, however that holders of Class A common stock are entitled to one vote per share of Class A common stock and holders of Class B common stock are entitled to 10 votes per share of Class B common stock on all matters submitted to the stockholders for approval. | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock, shares issued | ' | ' | ' | 8,625,000 | ' | ' | ' | ' | ' |
Underwriters' overallotment option | ' | ' | ' | 1,125,000 | ' | ' | ' | ' | ' |
Common stock shares sold | ' | ' | ' | 80,000 | ' | ' | ' | ' | ' |
Sale of stock, price per share | ' | ' | ' | $13 | ' | ' | ' | ' | ' |
Proceeds from issuance of initial public offering | ' | ' | ' | $103,309,000 | ' | ' | ' | ' | ' |
Deferred offering costs | $3,909,000 | ' | ' | $3,909,000 | ' | ' | ' | ' | ' |
Conversion of stock, shares issued | ' | ' | ' | ' | ' | ' | ' | 30,368,527 | 23,316,877 |
Common stock, shares, outstanding | ' | 8,625,000 | ' | ' | 53,605,404 | ' | 53,685,404 | ' | ' |
Components_of_Cash_and_Cash_Eq
Components of Cash and Cash Equivalents (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||||
Cash And Cash Equivalents [Line Items] | ' | ' | ' | ' |
Cash | $13,220 | $3,599 | ' | ' |
Money market funds | 12,232 | 34,265 | ' | ' |
Total cash and cash equivalents | $25,452 | $37,864 | $16,733 | $13,577 |
Components_of_Accounts_Receiva
Components of Accounts Receivable, Net (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Disclosure - Components of Accounts Receivable, Net (Detail) [Line Items] | ' | ' |
Accounts receivable-trade | $1,784 | $2,683 |
Unbilled accounts receivable-trade | 833 | 440 |
Allowance for doubtful accounts | -125 | -433 |
Accounts receivable, net | $2,492 | $2,690 |
Components_of_Prepaid_Expenses
Components of Prepaid Expenses and Other Current Assets (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Disclosure - Components of Prepaid Expenses and Other Current Assets (Detail) [Line Items] | ' | ' |
Deferred initial public offering costs | $3,909 | ' |
Settlements receivable from credit card transaction processors | 2,535 | 1,626 |
Other non-trade receivables from third parties | 2,268 | 24 |
Prepaid expenses | 2,656 | 1,596 |
Other current assets | 288 | 162 |
Total prepaid expenses and other current assets | $11,656 | $3,408 |
Components_of_Property_and_Equ
Components of Property and Equipment, Net (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Property Plant And Equipment [Line Items] | ' | ' |
Property and equipment, gross | $35,337 | $28,433 |
Less: accumulated depreciation | -18,036 | -11,425 |
Property and equipment, net | 17,301 | 17,008 |
Computer hardware and software | ' | ' |
Property Plant And Equipment [Line Items] | ' | ' |
Property and equipment, gross | 33,402 | 27,292 |
Furniture and fixtures | ' | ' |
Property Plant And Equipment [Line Items] | ' | ' |
Property and equipment, gross | 1,090 | 700 |
Leasehold improvements | ' | ' |
Property Plant And Equipment [Line Items] | ' | ' |
Property and equipment, gross | $845 | $441 |
Components_of_Accrued_Liabilit
Components of Accrued Liabilities (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Disclosure - Components of Accrued Liabilities (Detail) [Line Items] | ' | ' |
Accrued compensation and benefits | $4,066 | $3,216 |
Accrued sales, use and telecom related taxes | 4,399 | 4,580 |
Accrued initial public offering costs | 2,100 | ' |
Accrued expenses | 8,451 | 11,998 |
Accrued legal settlements | 750 | 1,075 |
Other | 718 | 618 |
Total accrued liabilities | $20,484 | $21,487 |
Fair_Value_of_Assets_Carried_a
Fair Value of Assets Carried at Fair Value (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Money market funds | ' | ' |
Cash equivalents: | ' | ' |
Cash equivalents, Fair value | $12,232 | $34,265 |
Certificates of deposit | ' | ' |
Other assets: | ' | ' |
Other assets, Fair value | 630 | 500 |
Level 1 | Money market funds | ' | ' |
Cash equivalents: | ' | ' |
Cash equivalents, Fair value | 12,232 | 34,265 |
Level 1 | Certificates of deposit | ' | ' |
Other assets: | ' | ' |
Other assets, Fair value | ' | ' |
Level 2 | Money market funds | ' | ' |
Cash equivalents: | ' | ' |
Cash equivalents, Fair value | ' | ' |
Level 2 | Certificates of deposit | ' | ' |
Other assets: | ' | ' |
Other assets, Fair value | 630 | 500 |
Level 3 | Money market funds | ' | ' |
Cash equivalents: | ' | ' |
Cash equivalents, Fair value | ' | ' |
Level 3 | Certificates of deposit | ' | ' |
Other assets: | ' | ' |
Other assets, Fair value | ' | ' |
Fair_Value_of_Financial_Instru2
Fair Value of Financial Instruments - Additional Information (Detail) (USD $) | Aug. 31, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
Warrants issued at June 2013 | Warrants issued at August 2013 | |||
Fair Value Inputs Liabilities Quantitative Information [Line Items] | ' | ' | ' | ' |
Fair value of warrants at issuance date | $495,000 | $265,000 | ' | ' |
Fair value of warrants | ' | ' | $320,000 | $500,000 |
Debt_Additional_Information_De
Debt - Additional Information (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Apr. 20, 2012 | Aug. 31, 2012 | Aug. 31, 2012 | Aug. 31, 2012 | Jan. 30, 2010 | Mar. 31, 2012 | Jan. 30, 2010 | Mar. 31, 2012 | Aug. 31, 2013 | Sep. 30, 2013 | Aug. 14, 2013 | Aug. 31, 2013 | Aug. 14, 2013 | Aug. 31, 2013 | Aug. 31, 2013 | Aug. 16, 2013 | Aug. 31, 2012 | Jun. 30, 2012 | Aug. 31, 2012 | Jun. 21, 2013 | Jun. 21, 2013 | Jun. 21, 2013 | Sep. 30, 2013 | Aug. 19, 2013 | Aug. 19, 2013 |
Apr-12 | Jan-13 | Jan-14 | Silicon Valley Bank Jan 2010 Term Loan | Silicon Valley Bank March 2012 Term Loan | Two Thousand And Ten Term Loan | Two Thousand Twelve Term Loans | Revolving Credit Facility | Revolving Credit Facility | Revolving Credit Facility | Silicon Valley Bank Aug 2013 Term Loan | Silicon Valley Bank Aug 2013 Term Loan | Silicon Valley Bank Aug 2013 Term Loan | Silicon Valley Bank Aug 2013 Term Loan | Silicon Valley Bank Aug 2013 Revolving Line of Credit | TriplePoint 2012 Capital Growth Loan (part 1) | TriplePoint 2012 Capital Growth Loan (part 1) | Triple Point 2012 Equipment Loan | Growth capital loan part II | Growth capital loan part II | TriplePoint June 2013 Capital Growth Loan (part II) | TriplePoint Aug 2013 Capital Growth Loan (part III) | TriplePoint Aug 2013 Capital Growth Loan (part III) | Growth capital loan part III | ||||
Installment | Installment | Minimum | Series E Preferred Stock | Installment | Installment | Series D Preferred Stock | Installment | Series E Preferred Stock | |||||||||||||||||||
Schedule Of Debt [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term loan | ' | ' | ' | ' | ' | ' | $2,500,000 | $8,000,000 | ' | ' | ' | ' | ' | $5,000,000 | ' | ' | ' | ' | ' | $6,000,000 | $9,691,000 | ' | ' | $4,000,000 | ' | $5,000 | ' |
Number of monthly installments | ' | ' | ' | ' | ' | ' | ' | ' | 30 | 36 | ' | ' | ' | ' | ' | ' | ' | ' | 36 | ' | ' | ' | ' | ' | ' | ' | ' |
Term loan fixed interest rate | ' | ' | ' | ' | ' | ' | ' | ' | 6.50% | ' | ' | ' | ' | 11.00% | ' | ' | ' | ' | ' | 8.50% | 5.75% | ' | ' | 8.50% | ' | 11.00% | ' |
Maturity payment interest rate | ' | ' | ' | ' | ' | ' | ' | ' | 3.50% | 0.50% | ' | ' | ' | 2.75% | ' | ' | ' | ' | ' | 4.00% | 10.00% | ' | ' | 4.00% | ' | ' | ' |
Interest rate on debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.75% | 2.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revolving line of credit | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revolving line of credit maturity date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 13-Aug-15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term loan maturity date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1-Aug-16 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Borrowing under the revolving line of credit facility | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,778,000 | 10,778,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding balance of term loan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,222,000 | ' | ' | 5,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Line of credit, available borrowing capacity | 222,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of warrants to purchase preferred stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 90,324 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 33,192 | ' | 51,614 | ' |
Warrants, exercise price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $9.69 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $6.03 | ' | $9.69 | ' |
Discount on Issuance of Warrants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 866,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 265,000 | ' | 495,000 | ' |
Expected volatility rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 60.00% | ' | ' | ' | ' | ' | 55.00% | ' | ' | ' | 60.00% |
Expected life | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | '7 years | ' | ' | ' | '10 years |
Risk free interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.70% | ' | ' | ' | ' | ' | 1.90% | ' | ' | ' | 2.70% |
Dividend yield | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.00% | ' | ' | ' | ' | ' | 0.00% | ' | ' | ' | 0.00% |
Fair value of preferred stock per share | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $12.86 | ' | ' | ' | ' | ' | $11.41 | ' | ' | ' | $12.86 |
Cash | 13,220,000 | 3,599,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of principal and interest payments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 33 | ' | ' | ' | 33 | ' | ' | ' |
Available lending commitment | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10,000,000 | ' | ' | ' | ' | ' | ' |
Additional borrowings under the plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,000,000 | ' | ' | ' | 5,000,000 | ' |
Conditional requirement for additional borrowings | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50,000,000 | ' | ' | ' |
Period for interest payment only | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 months | ' | ' | '36 months | ' | ' |
Fixed rate of interest for interest only period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9.00% | ' | ' | ' | ' | ' |
Final payment percentage amount advanced under the term loan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.75% | ' |
Loan to purchase software | ' | ' | 1,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loan to purchase software, installment payments | ' | ' | ' | $500,000 | $500,000 | $500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Commitments_and_Contingencies_
Commitments and Contingencies - Additional Information (Detail) (USD $) | 3 Months Ended | |
Sep. 30, 2013 | Dec. 31, 2012 | |
Disclosure - Commitments and Contingencies - Additional Information (Detail) [Line Items] | ' | ' |
Long-term sales tax liability | $4,003,000 | $3,877,000 |
Current sales tax liability for noncontingent amounts | 2,973,000 | 3,574,000 |
Settlement net of insurance recovery | $1,160,000 | ' |
ShareBased_Compensation_Summar
Share-Based Compensation - Summary of Share-Based Compensation Expense Recognized to Statements of Operations (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
Share-based compensation expense | $2,210 | $769 | $4,546 | $1,984 |
Cost of services revenues | ' | ' | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
Share-based compensation expense | 129 | 66 | 297 | 175 |
Research and development | ' | ' | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
Share-based compensation expense | 367 | 223 | 884 | 536 |
Sales and marketing | ' | ' | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
Share-based compensation expense | 330 | 153 | 734 | 483 |
General and administrative | ' | ' | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
Share-based compensation expense | $1,384 | $327 | $2,631 | $790 |
ShareBased_Compensation_Summar1
Share-Based Compensation - Summary of Stock Option Activity Plans (Detail) (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' |
Number of Options Outstanding, Beginning Balance | 8,609 | ' |
Number of Options Outstanding, Granted | 3,701 | ' |
Number of Options Outstanding, Exercised | -593 | ' |
Number of Options Outstanding, Canceled/Forfeited Options | -632 | ' |
Number of Options Outstanding, Ending Balance | 11,085 | 8,609 |
Number of Options Outstanding, Vested and expected to vest | 10,147 | ' |
Number of Options Outstanding, Exercisable | 4,612 | ' |
Weighted Average Exercise Price Per Share, Beginning Balance | $2.89 | ' |
Weighted Average Exercise Price Per Share, Granted | $11.30 | ' |
Weighted Average Exercise Price Per Share, Exercised | $1.42 | ' |
Weighted Average Exercise Price Per Share, Canceled/Forfeited | $4.16 | ' |
Weighted Average Exercise Price Per Share, Ending Balance | $5.71 | $2.89 |
Weighted Average Exercise Price Per Share, Vested and expected to vest | $5.38 | ' |
Weighted Average Exercise Price Per Share, Exercisable | $2.06 | ' |
Weighted-Average Contractual Term, Beginning balance | '8 years | '7 years 2 months 12 days |
Weighted-Average Contractual Term, Vested and expected to vest | '7 years 9 months 18 days | ' |
Weighted-Average Contractual Term, Exercisable | '6 years 3 months 18 days | ' |
Aggregate Intrinsic Value, Beginning Balance | $40,705 | ' |
Aggregate Intrinsic Value, Ending Balance | 136,491 | 40,705 |
Aggregate Intrinsic Value, Vested and expected to vest | 128,249 | ' |
Aggregate Intrinsic Value, Exercisable | $73,610 | ' |
ShareBased_Compensation_Weight
Share-Based Compensation - Weighted Average Grant Date Fair Value of Options Granted and Total Intrinsic Value of Options Exercised (Detail) (USD $) | 9 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' |
Weighted average grant date fair value per share | $6.08 | $3.05 |
Total intrinsic value of options exercised | $9,855 | $1,591 |
ShareBased_Compensation_Weight1
Share-Based Compensation - Weighted Average Assumptions Used to Fair Value of Stock Options Granted (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
Risk-free interest rate | 1.99% | 0.84% | 1.68% | 0.96% |
Expected volatility | 54.00% | 57.00% | 54.00% | 61.00% |
Expected dividend rate | 0.00% | 0.00% | 0.00% | 0.00% |
Expected term for employees (in years) | ' | ' | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
Expected life (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 |
Expected term for non-employees (in years) | ' | ' | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
Expected life (in years) | '10 years | '10 years | '10 years | '10 years |
ShareBased_Compensation_Summar2
Share-Based Compensation - Summary of Status of Nonvested Shares Activity (Detail) (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' |
Number of Shares Nonvested, Beginning Balance | 100 | 58 |
Number of Shares, Early exercises | ' | 100 |
Number of Shares, Vested | -51 | -58 |
Number of Shares Nonvested, Ending Balance | 49 | 100 |
Nonvested Common Stock Liability, Beginning Balance | $204 | $64 |
Nonvested Common Stock Liability, Early exercises | ' | 200 |
Nonvested Common Stock Liability, Vested | -98 | -60 |
Nonvested Common Stock Liability, Ending Balance | $106 | $204 |
ShareBased_Compensation_Summar3
Share-Based Compensation - Summary of Assumptions Used to Value Employee Stock Purchase Rights Under the Black-Scholes Model (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
Risk-free interest rate | 1.99% | 0.84% | 1.68% | 0.96% |
Expected volatility | 54.00% | 57.00% | 54.00% | 61.00% |
Expected dividend rate | 0.00% | 0.00% | 0.00% | 0.00% |
Black Scholes Option Pricing Model | ' | ' | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
Expected life (in years) | '6 years | ' | '6 years | ' |
Risk-free interest rate | 0.03% | ' | 0.03% | ' |
Expected volatility | 42.00% | ' | 42.00% | ' |
Expected dividend rate | 0.00% | ' | 0.00% | ' |
ShareBased_Compensation_Additi
Share-Based Compensation - Additional Information (Detail) (USD $) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Dec. 31, 2012 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' |
Nonvested share-based compensation expense | $23,277,000 | $9,587,000 |
Nonvested share-based compensation expense, remaining weighted-average vesting periods | '3 years | '2 years 8 months 12 days |
Contractual term | '6 years 3 months 18 days | ' |
Employee Stock Purchase Plan | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' |
Common stock reserved for issuance | 1,250,000 | ' |
Percentage of outstanding shares of common stock | 1.00% | ' |
Common stock, shares, outstanding | 1,250,000 | ' |
Eligible compensation under the Employee Stock Purchase Plan | 15.00% | ' |
Eligible compensation under the Employee Stock Purchase Plan, amount | $25,000 | ' |
Purchase of maximum shares by employees under Employee Stock Purchase Plan | 3,000 | ' |
Shares available for issuance under the Employee Stock Purchase Plan | 1,250,000 | ' |
Employee Stock Purchase Plan | Minimum | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' |
Purchase price of Employee Stock Purchase Plan as a percentage of fair value | 90.00% | ' |
2013 Equity Incentive Plan | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' |
Common stock reserved for issuance | 6,200,000 | ' |
Percentage of outstanding shares of common stock | 5.00% | ' |
Common stock, shares, outstanding | 6,200,000 | ' |
Graded vesting schedule, number of years continuous service | '4 years | ' |
Contractual term | '10 years | ' |
Remaining shares available for granted | 6,166,350 | ' |
2010 Equity Incentive Plan | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' |
Remaining shares available for granted | ' | 468,000 |
Geographic_Concentrations_Addi
Geographic Concentrations - Additional Information (Detail) (Operating Segments, United States) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Operating Segments | United States | ' | ' | ' | ' | ' |
Sales Information [Line Items] | ' | ' | ' | ' | ' |
Percentage of revenue | 90.00% | 90.00% | 90.00% | 90.00% | ' |
Percentage of property and equipment held | 85.00% | ' | 85.00% | ' | 95.00% |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Income Taxes [Line Items] | ' | ' | ' | ' |
Provision (benefit) for income taxes | $54 | $25 | ($66) | $57 |
Basic_and_Diluted_Net_Loss_Per2
Basic and Diluted Net Loss Per Share - Computation of Company's Basic and Diluted Net Loss Per Share of Common Stock (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Numerator | ' | ' | ' | ' |
Net loss | ($8,852) | ($9,568) | ($32,732) | ($28,307) |
Denominator | ' | ' | ' | ' |
Weighted-average common shares for basic and diluted net loss per share | 24,452 | 22,372 | 23,290 | 22,273 |
Basic and diluted net loss per share | ($0.36) | ($0.43) | ($1.41) | ($1.27) |
Basic_and_Diluted_Net_Loss_Per3
Basic and Diluted Net Loss Per Share - Potential Shares of Common Stock Excluded from Diluted Weighted-Average Common Shares Outstanding (Detail) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Potential common shares excluded from diluted net loss per share | 11,636 | 36,445 | 11,636 | 36,445 |
Conversion Of Preferred Stock | ' | ' | ' | ' |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Potential common shares excluded from diluted net loss per share | ' | 27,272 | ' | 27,272 |
Conversion Of Warrants | ' | ' | ' | ' |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Potential common shares excluded from diluted net loss per share | 502 | 337 | 502 | 337 |
Repurchase Common Stock | ' | ' | ' | ' |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Potential common shares excluded from diluted net loss per share | 49 | 110 | 49 | 110 |
Employee Stock Option | ' | ' | ' | ' |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Potential common shares excluded from diluted net loss per share | 11,085 | 8,726 | 11,085 | 8,726 |
Subsequent_Events_Additional_I
Subsequent Events - Additional Information (Details) (Subsequent Event, Initial Public Offering, Class A Common Stock, USD $) | 1 Months Ended |
Oct. 02, 2013 | |
Subsequent Event | Initial Public Offering | Class A Common Stock | ' |
Subsequent Event [Line Items] | ' |
Common stock, shares issued | 8,625,000 |
Underwriters' overallotment option | 1,125,000 |
Common stock shares sold | 80,000 |
Sale of stock, price per share | $13 |
Proceeds from issuance of initial public offering | $103,309,000 |
Underwriters' discounts and commissions, before deduction of offering expenses | $3,909,000 |