Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2024 | Aug. 09, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Document Period End Date | Jun. 30, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-37703 | |
Entity Registrant Name | IZEA WORLDWIDE, INC. | |
Entity Incorporation, State or Country Code | NV | |
Entity Tax Identification Number | 37-1530765 | |
Entity Address, Address Line One | 1317 Edgewater Dr. | |
Entity Address, Address Line Two | # 1880 | |
Entity Address, City or Town | Orlando | |
Entity Address, State or Province | FL | |
Entity Address, Postal Zip Code | 32804 | |
City Area Code | (407) | |
Local Phone Number | 674-6911 | |
Title of 12(b) Security | Common Stock, par value $0.0001 per share | |
Trading Symbol | IZEA | |
Security Exchange Name | NASDAQ | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 16,450,424 | |
Entity Central Index Key | 0001495231 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Entity Interactive Data Current | Yes | |
Entity Current Reporting Status | Yes |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Jun. 30, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 44,301,866 | $ 37,446,728 |
Accounts receivable, net | 5,617,269 | 5,012,373 |
Prepaid expenses | 1,046,154 | 739,988 |
Short term investments | 11,286,453 | 17,126,057 |
Other current assets | 43,451 | 26,257 |
Total current assets | 62,295,193 | 60,351,403 |
Property and equipment, net of accumulated depreciation | 155,835 | 205,377 |
Goodwill | 5,281,888 | 5,280,372 |
Intangible assets, net | 1,624,951 | 1,749,441 |
Digital assets | 243,020 | 162,905 |
Software development costs, net | 2,241,437 | 2,056,972 |
Long term investments | 897,027 | 9,618,996 |
Total assets | 72,739,351 | 79,425,466 |
Current liabilities: | ||
Accounts payable | 1,306,266 | 1,504,348 |
Accrued expenses | 3,161,829 | 3,083,460 |
Contract liabilities | 7,176,694 | 8,891,205 |
Contingent Liability | 0 | 114,400 |
Total current liabilities | 11,644,789 | 13,593,413 |
Finance obligation, less current portion | 33,727 | 63,419 |
Deferred purchase price, less current portion | 0 | 60,600 |
Deferred tax liability | 287,002 | 394,646 |
Total liabilities | 11,965,518 | 14,112,078 |
Commitments and Contingencies (Note 9) | ||
Stockholders’ equity: | ||
Preferred stock; $0.0001 par value; $10,000,000 shares authorized; no shares issued and outstanding | 0 | 0 |
Common stock; $0.0001 par value; $50,000,000 shares authorized; shares issued: $16,770,418 and $16,602,155, respectively, shares outstanding: $16,404,563 and $16,236,300, respectively. | 1,677 | 1,660 |
Treasury stock at cost: $365,855 and $365,855 shares at June 30, 2024 and December 31, 2023, respectively | (1,019,997) | (1,019,997) |
Additional paid-in capital | 152,809,711 | 152,027,110 |
Accumulated deficit | (90,905,472) | (85,444,794) |
Accumulated other comprehensive income (loss) | (112,086) | (250,591) |
Total stockholders’ equity | 60,773,833 | 65,313,388 |
Liabilities and Equity | $ 72,739,351 | $ 79,425,466 |
Consolidated Balance Sheets - P
Consolidated Balance Sheets - Parenthetical - $ / shares | Jun. 30, 2024 | Dec. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (shares) | 50,000,000 | 50,000,000 |
Common stock, shares, issued (shares) | 16,770,418 | 16,602,155 |
Common stock, shares outstanding (shares) | 16,404,563 | 16,236,300 |
Treasury stock (shares) | 365,855 | 365,855 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Income Statement [Abstract] | ||||
Revenue | $ 9,093,816 | $ 10,689,059 | $ 16,046,699 | $ 19,426,781 |
Costs and expenses: | ||||
Cost of revenue | 5,177,600 | 6,254,517 | 9,145,575 | 12,214,679 |
Sales and marketing | 3,206,979 | 2,831,949 | 6,263,270 | 5,236,500 |
General and administrative | 3,372,797 | 3,167,941 | 7,155,883 | 6,571,549 |
Depreciation and amortization | 225,748 | 110,432 | 429,934 | 456,694 |
Total costs and expenses | 11,983,124 | 12,364,839 | 22,994,662 | 24,479,422 |
Loss from operations | (2,889,308) | (1,675,780) | (6,947,963) | (5,052,641) |
Other income (expense): | ||||
Change in the fair value of digital assets | (26,043) | 0 | 80,116 | 0 |
Interest expense | (1,999) | (3,155) | (4,000) | (4,719) |
Other income (expense), net | 634,226 | 645,509 | 1,304,091 | 1,217,595 |
Total other income (expense), net | 606,184 | 642,354 | 1,380,207 | 1,212,876 |
Net loss before income taxes | (2,283,124) | (1,033,426) | (5,567,756) | (3,839,765) |
Income tax benefit (expense) | 88,296 | 0 | 107,078 | 0 |
Net loss | $ (2,194,828) | $ (1,033,426) | $ (5,460,678) | $ (3,839,765) |
Weighted average common shares outstanding - basic (in shares) | 16,437,460 | 15,520,700 | 16,470,467 | 15,551,785 |
Weighted average common shares outstanding - diluted (in shares) | 16,437,460 | 15,520,700 | 16,470,467 | 15,551,785 |
Basic loss per common share (in dollars per share) | $ (0.13) | $ (0.07) | $ (0.33) | $ (0.25) |
Diluted loss per common share (in dollars per share) | $ (0.13) | $ (0.07) | $ (0.33) | $ (0.25) |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (2,194,828) | $ (1,033,426) | $ (5,460,678) | $ (3,839,765) |
Unrealized (gain) loss on securities held | (92,630) | (10,100) | (150,807) | (136,280) |
Unrealized (gain) loss on currency translation | 16,472 | 0 | 12,302 | 0 |
Total other comprehensive income (loss) | (76,158) | (10,100) | (138,505) | (136,280) |
Total comprehensive income (loss) | $ (2,118,670) | $ (1,023,326) | $ (5,322,173) | $ (3,703,485) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) | Total | Cash and cash equivalents | US Treasury securities | Corporate debt securities | Asset back securities | Common Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) |
Balance (shares) at Jun. 30, 2023 | 15,734,680 | |||||||||
Balance at Jun. 30, 2023 | $ 66,362,657 | $ 1,574 | $ 149,646,200 | $ (705,403) | $ (81,935,199) | $ (644,515) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Stock issued for payment of services, net (shares) | 59,797 | |||||||||
Stock issued for payment of services | 150,009 | $ 6 | 150,003 | |||||||
Stock-based compensation (shares) | 67,446 | |||||||||
Stock-based compensation | 403,399 | $ 7 | 403,392 | |||||||
Share withheld to cover statutory taxes (shares) | (24,278) | |||||||||
Shares withheld to cover statutory taxes | $ (63,434) | $ (2) | (63,432) | |||||||
Stock Issued During Period, Value, Reverse Stock Splits | $ 2 | (2) | ||||||||
Reverse stock split fractional share adjustment (shares) | 23,789 | |||||||||
Stock Repurchased and Retired During Period, Value | $ (705,403) | (705,403) | ||||||||
Unrealized gain on securities held | 136,280 | 136,280 | ||||||||
Total other comprehensive income (loss) | (136,280) | |||||||||
Net loss | (3,839,765) | (3,839,765) | ||||||||
Balance (shares) at Dec. 31, 2022 | 15,603,597 | |||||||||
Balance at Dec. 31, 2022 | 70,265,947 | $ 1,560 | 149,148,248 | (78,103,066) | (780,795) | |||||
Balance (Accounting Standards Update 2023-08) at Dec. 31, 2022 | 7,632 | 7,632 | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Stock purchase plan & option exercise issuances (in shares) | 4,329 | |||||||||
Stock purchase plan & option exercise issuances | $ 7,992 | $ 1 | 7,991 | |||||||
Balance (shares) at Dec. 31, 2023 | 16,236,300 | 16,602,155 | ||||||||
Balance at Dec. 31, 2023 | $ 65,313,388 | $ 1,660 | 152,027,110 | (1,019,997) | (85,444,794) | (250,591) | ||||
Balance (shares) at Dec. 31, 2022 | 15,603,597 | |||||||||
Balance at Dec. 31, 2022 | 70,265,947 | $ 1,560 | 149,148,248 | (78,103,066) | (780,795) | |||||
Balance (Accounting Standards Update 2023-08) at Dec. 31, 2022 | 7,632 | 7,632 | ||||||||
Balance (shares) at Jun. 30, 2023 | 15,734,680 | |||||||||
Balance at Jun. 30, 2023 | 66,362,657 | $ 1,574 | 149,646,200 | (705,403) | (81,935,199) | (644,515) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Stock issued for payment of services, net (shares) | 30,990 | |||||||||
Stock issued for payment of services | 75,009 | $ 3 | 75,006 | |||||||
Stock-based compensation (shares) | 38,229 | |||||||||
Stock-based compensation | 207,877 | $ 4 | 207,873 | |||||||
Share withheld to cover statutory taxes (shares) | (12,892) | |||||||||
Shares withheld to cover statutory taxes | $ (32,563) | $ (1) | (32,562) | |||||||
Stock Issued During Period, Value, Reverse Stock Splits | $ 2 | (2) | ||||||||
Reverse stock split fractional share adjustment (shares) | 23,789 | |||||||||
Stock Repurchased and Retired During Period, Value | $ (705,403) | (705,403) | ||||||||
Unrealized gain on securities held | 10,100 | 10,100 | ||||||||
Total other comprehensive income (loss) | (10,100) | |||||||||
Net loss | (1,033,426) | (1,033,426) | ||||||||
Balance (shares) at Mar. 31, 2023 | 15,650,235 | |||||||||
Balance at Mar. 31, 2023 | 67,833,071 | $ 1,565 | 149,387,894 | 0 | (80,901,773) | (654,615) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Stock purchase plan & option exercise issuances | 7,992 | $ 1 | 7,991 | |||||||
Fair Value | 64,191,781 | $ 37,446,728 | $ 6,939,713 | $ 16,196,931 | $ 3,608,409 | |||||
Balance (shares) at Mar. 31, 2024 | 16,666,513 | |||||||||
Balance at Mar. 31, 2024 | $ 62,501,847 | $ 1,667 | 152,419,065 | (1,019,997) | (88,710,644) | (188,244) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Reverse stock split fractional share adjustment (shares) | 23,789 | |||||||||
Balance (shares) at Dec. 31, 2023 | 16,236,300 | 16,602,155 | ||||||||
Balance at Dec. 31, 2023 | $ 65,313,388 | $ 1,660 | 152,027,110 | (1,019,997) | (85,444,794) | (250,591) | ||||
Balance (shares) at Jun. 30, 2024 | 16,404,563 | 16,770,418 | ||||||||
Balance at Jun. 30, 2024 | $ 60,773,833 | $ 1,677 | 152,809,711 | (1,019,997) | (90,905,472) | (112,086) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Stock issued for payment of services, net (shares) | 64,385 | |||||||||
Stock issued for payment of services | 150,006 | $ 6 | 150,000 | |||||||
Stock-based compensation (shares) | 151,587 | |||||||||
Stock-based compensation | 749,120 | $ 15 | 749,105 | |||||||
Share withheld to cover statutory taxes (shares) | (51,069) | |||||||||
Shares withheld to cover statutory taxes | (122,415) | $ (4) | (122,411) | |||||||
Unrealized gain on securities held | 150,807 | 150,807 | ||||||||
Translation Adjustment Functional to Reporting Currency, Net of Tax, Period Increase (Decrease) | (12,302) | (12,302) | ||||||||
Total other comprehensive income (loss) | (138,505) | |||||||||
Net loss | $ (5,460,678) | (5,460,678) | ||||||||
Balance (shares) at Dec. 31, 2023 | 16,236,300 | 16,602,155 | ||||||||
Balance at Dec. 31, 2023 | $ 65,313,388 | $ 1,660 | 152,027,110 | (1,019,997) | (85,444,794) | (250,591) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Stock purchase plan & option exercise issuances (in shares) | 3,360 | |||||||||
Stock purchase plan & option exercise issuances | $ 5,907 | $ 0 | 5,907 | |||||||
Balance (shares) at Jun. 30, 2024 | 16,404,563 | 16,770,418 | ||||||||
Balance at Jun. 30, 2024 | $ 60,773,833 | $ 1,677 | 152,809,711 | (1,019,997) | (90,905,472) | (112,086) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Stock issued for payment of services, net (shares) | 31,915 | |||||||||
Stock issued for payment of services | 75,000 | $ 3 | 74,997 | |||||||
Stock-based compensation (shares) | 101,566 | |||||||||
Stock-based compensation | 394,931 | $ 10 | 394,921 | |||||||
Share withheld to cover statutory taxes (shares) | (32,936) | |||||||||
Shares withheld to cover statutory taxes | (85,182) | $ (3) | (85,179) | |||||||
Unrealized gain on securities held | 92,630 | 92,630 | ||||||||
Translation Adjustment Functional to Reporting Currency, Net of Tax, Period Increase (Decrease) | (16,472) | 0 | (16,472) | |||||||
Total other comprehensive income (loss) | (76,158) | |||||||||
Net loss | (2,194,828) | (2,194,828) | ||||||||
Balance (shares) at Mar. 31, 2024 | 16,666,513 | |||||||||
Balance at Mar. 31, 2024 | 62,501,847 | $ 1,667 | 152,419,065 | $ (1,019,997) | $ (88,710,644) | $ (188,244) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Stock purchase plan & option exercise issuances (in shares) | 3,360 | |||||||||
Stock purchase plan & option exercise issuances | 5,907 | $ 0 | $ 5,907 | |||||||
Fair Value | $ 56,485,346 | $ 44,301,866 | $ 1,993,383 | $ 7,833,583 | $ 2,356,514 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Cash flows from operating activities: | ||
Net loss | $ (5,460,678) | $ (3,839,765) |
Adjustments to reconcile net loss to net cash used for operating activities: | ||
Adjustment to fair market value of digital assets | (80,115) | 0 |
Depreciation | 53,258 | 45,946 |
Amortization | 376,676 | 410,748 |
Deferred tax benefit | (107,644) | 0 |
Stock-based compensation | 749,120 | 403,399 |
Value of stock issued or to be issued for payment of services | 150,006 | 150,009 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (604,896) | (653,146) |
Prepaid expenses and other current assets | (323,359) | 2,467,714 |
Accounts payable | (198,081) | 148,750 |
Accrued expenses | (96,633) | 43,082 |
Contract liabilities | (1,714,511) | (2,990,579) |
Net cash used for operating activities | (7,256,857) | (3,813,842) |
Cash flows from investing activities: | ||
Purchase of short term investments | (146,697,435) | (172,865,911) |
Proceeds from the sale of short-term investments | 152,687,846 | 174,848,157 |
Proceeds from the sale of long term investments | 8,721,969 | 9,718,381 |
Purchase of property and equipment | (29,692) | (65,803) |
Capitalization of software development costs | (437,152) | (437,877) |
Net cash provided by investing activities | 14,245,536 | 11,196,947 |
Cash flows from financing activities: | ||
Proceeds from exercise of stock options & ESPP issuances | 5,907 | 7,992 |
Purchase of treasury stock | 0 | (705,403) |
Payments on shares withheld for statutory taxes | (122,415) | (63,434) |
Net cash used in financing activities | (116,508) | (760,845) |
Effect of exchange rate changes on cash | (17,033) | 0 |
Net increase in cash and cash equivalents | 6,872,171 | 6,622,260 |
Cash and cash equivalents, beginning of period | 37,446,728 | 24,600,960 |
Cash and cash equivalents, end of period | 44,301,866 | 31,223,220 |
Supplemental cash flow information: | ||
Interest paid | 4,000 | 4,553 |
Non-cash financing and investing activities: | ||
Equipment acquired with financing arrangement | 0 | 83,508 |
Fair Value of common stock issued for services | $ 150,006 | $ 150,009 |
Company and Summary of Signific
Company and Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2024 | |
Accounting Policies [Abstract] | |
Company and Summary of Significant Accounting Policies | COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Corporate Information and Nature of Business IZEA Worldwide, Inc. (together with its wholly-owned subsidiaries, “IZEA” or the “Company”) is a Nevada corporation that was founded in February 2006 under the name PayPerPost, Inc. and became a public company in May 2011. In January 2015, IZEA purchased all of the outstanding shares of capital stock of Ebyline, Inc. (“Ebyline”). In March 2016, the Company formed IZEA Canada, Inc., a wholly-owned subsidiary, incorporated in Ontario, Canada, to operate as a sales and support office for IZEA’s Canadian customers. In July 2016, IZEA purchased all the outstanding shares of capital stock of ZenContent, Inc. (“ZenContent”) and in July 2018, a subsidiary of the Company merged with TapInfluence, Inc. (“TapInfluence”). The ZenContent legal entity was dissolved in December 2017, and Ebyline and TapInfluence were merged into IZEA and the legal entities were dissolved in December 2019 and December 2020, respectively. IZEA purchased all of the outstanding shares of capital stock of Hoozu Holdings, Ltd in December 2023, and completed an asset acquisition from Zuberance, Inc. in December 2023. The Company helps power the creator economy, by enabling individuals to monetize their content, creativity and influence through global brands and marketers. IZEA compensates these creators for producing unique content, such as long and short-form text, videos, photos, status updates, and illustrations for marketers or distributing such content on behalf of marketers through their websites, blogs, and social media channels. The Company also provides value through managing custom content workflow, creator search and targeting, bidding, analytics, and payment processing. While the majority of the marketers engage the Company to perform these services (the “Managed Services”) on their behalf, they may also access IZEA’s marketplaces to engage creators for influencer marketing campaigns or to produce custom content on a self-service basis by licensing the Company’s technology. Basis of Presentation The accompanying consolidated balance sheet as of June 30, 2024, the consolidated statements of operations for the three and six months ended June 30, 2024 and 2023, the consolidated statements of comprehensive loss for the three and six months ended June 30, 2024 and 2023, the consolidated statements of stockholders' equity for the three and six months ended June 30, 2024 and 2023, and the consolidated statements of cash flows for the six months ended June 30, 2024 and 2023 are unaudited but include all adjustments that are, in the opinion of management, necessary for a fair presentation of its financial position at such dates and its results of operations and cash flows for the periods then ended in conformity with generally accepted accounting principles in the United States ("GAAP"). The consolidated balance sheet as of December 31, 2023 has been derived from the audited consolidated financial statements at that date but, in accordance with the rules and regulations of the SEC, does not include all of the information and notes required by GAAP for complete financial statements. Operating results for the three and six months ended June 30, 2024 are not necessarily indicative of results that may be expected for the entire fiscal year. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended December 31, 2023, included in the Company's Annual Report on Form 10-K filed with the SEC on April 1, 2024. Principles of Consolidation The consolidated financial statements include the accounts of IZEA Worldwide, Inc. and its wholly-owned subsidiaries, subsequent to the subsidiaries’ individual acquisition, merger, or formation dates, as applicable. All significant intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires 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. Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less from the date of purchase to be cash equivalents. Deposits made to Company bank accounts are insured by the FDIC up to a maximum amount of $250,000. The CDIC insures deposits made to the Company’s bank accounts in Canada up to CAD 100,000. The Australian Financial Claims Scheme insures deposits made to the Company’s accounts in Australia up to AUD $250,000. Deposit balances exceeding this limit were approximately $43.6 million and $36.7 million as of June 30, 2024 and 2023, respectively. Investment in Debt Securities Our investments in debt securities are carried at either amortized cost or fair value. The cost basis is determined by the specific identification method. Investments in debt securities that the Company has the positive intent and ability to hold to maturity are carried at amortized cost and classified as held-to-maturity. Investments in debt securities that are not classified as held-to-maturity are carried at fair value and classified as either trading or available-for-sale. Realized and unrealized gains and losses on trading debt securities as well as realized gains and losses on available-for-sale debt securities are included in net income. Unrealized gains and losses, net of tax, on available-for-sale debt securities are included in our consolidated balance sheet as a component of accumulated other comprehensive income (loss). Accounts Receivable and Concentration of Credit Risk The Company’s accounts receivable balance consists of trade receivables, contract assets, and a reserve for doubtful accounts. Trade receivables are customer obligations due under normal trade terms. Contract assets represent amounts owed for work that has been performed but not yet billed. The Company had net trade receivables of $5.6 million, including $5.6 million of accounts receivable and contract assets of $54,217 on June 30, 2024. The Company had net trade receivables of $5.0 million, including $4.9 million of accounts receivable and contract assets of $83,697 at December 31, 2023. Management determines the collectability of accounts by regularly evaluating individual customer receivables and considering a customer’s financial condition, credit history, and current economic conditions. An account is deemed delinquent when the customer has not paid an amount due by its associated due date. If a portion of the account balance is deemed uncollectible, the Company will either write off the amount owed or provide a reserve based on its best estimate of the uncollectible portion of the account. We assess collectability risk both generally and by specific aged invoices. Our loss history informs a general reserve percentage, which we apply to all invoices less than 90 days from the invoice due date, currently 1.1% of the outstanding balance. The general reserve, which we update periodically, recognizes that some invoices will likely become a collection risk. When an invoice ages 90 days past its due date, we consider each invoice to determine a reserve for collectability based on our prior history and recent communications with the customer, to determine a reserve amount. Generally, our reserve for such aged invoices will approach 100% of the invoice amount. The Company had a reserve for doubtful accounts of $205,000 as of June 30, 2024, and $155,000 as of June 30, 2023. Management believes that this estimate is reasonable, but there can be no assurance that the estimate will not change due to a change in economic conditions or business conditions within the industry, the individual customers, or the Company. Any adjustments to this account are reflected in the consolidated statements of operations as a general and administrative expense. The Company did not recognize any bad debt expense in the three and six months ended June 30, 2024 and recognized $50,000 in the twelve months ended December 31, 2023. Concentrations of credit risk with respect to accounts receivable have been typically limited because a large number of geographically diverse customers make up the Company’s customer base, thus spreading the trade credit risk. The Company controls credit risk through credit approvals, credit limits, and monitoring procedures. The Company performs credit evaluations of its customers but generally does not require collateral to support accounts receivable. The Company had one customer that accounted for more than 10% of total accounts receivable at June 30, 2024 and one customer that accounted for more than 10% of total accounts receivable at December 31, 2023. The Company had two customers each that accounted for more than 10% of its revenue during the six months ended June 30, 2024 and one customer that accounted for more than 10% of its revenue during the six months ended June 30, 2023. Property and Equipment Property and equipment are recorded at cost, or if acquired in a business combination, at the acquisition date fair value. Depreciation is computed using the straight-line method over the estimated useful lives of the assets as follows: Computer Equipment 3 years Office Equipment 3 - 10 years Furniture and Fixtures 5 - 10 years The carrying amounts of assets sold or retired and the related accumulated depreciation are eliminated in the year of disposal, with resulting gains or losses included in general and administrative expense in the consolidated statements of operations. Goodwill Goodwill represents the excess of the consideration transferred for an acquired business over the fair value of the underlying identifiable net assets. The Company has goodwill in connection with its acquisitions of Ebyline, ZenContent, TapInfluence, and Hoozu. Goodwill is not amortized but instead, it is tested for impairment at least annually. In the event that management determines that the value of goodwill has become impaired, the Company will record a charge in an amount equal to the excess of the reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit during the fiscal quarter in which the determination is made. Goodwill is required to be tested for impairment at the reporting unit level. A reporting unit is an operating segment or one level below the operating segment level, which is referred to as a component. Management identifies its reporting units by assessing whether components (i) have discrete financial information available, (ii) engage in business activities, and (iii) whether a segment manager regularly reviews the component’s operating results. Prior to the acquisition of Hoozu on December 1, 2023, IZEA had one business operating segment with one reporting unit for purposes of goodwill impairment testing. Hoozu is being treated as a second, separate reporting unit for goodwill impairment testing. The Company performs its annual impairment tests of goodwill as of October 1 each year, or more frequently if certain indicators are present. As described in Note 5, there were no impairment charges associated with the Company’s goodwill in the three and six months ended June 30, 2024 and 2023, respectively. Intangible Assets The Company acquired the majority of its intangible assets through its acquisitions of Ebyline, ZenContent, TapInfluence, and Hoozu. The Company amortizes identifiable intangible assets over periods of 12 to 60 months. See Note 5 for further details. The Company accounts for its digital assets held as indefinite-lived intangible assets in accordance with ASC 350, Intangibles—Goodwill and Other. The Company maintains ownership of and control over its digital assets and may use third-party custodial services to secure them. The digital assets are initially recorded at cost and are subsequently evaluated for any changes in the fair market value. The Company did not recognize any impairment of digital assets during the three and six months ended June 30, 2024, and 2023. In December 2023, the FASB issued ASU No. 2023-08, Intangibles - Goodwill and Other - Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets (“ASU 2023-08”) . ASU 2023-08 requires fair value measurement of certain crypto assets each reporting period with the changes in fair value reflected in net income. The amendments also require disclosures of the name, fair value, units held, and cost bases for each significant crypto asset held and annual reconciliations of crypto asset holdings. The new guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2024, with early adoption permitted. The Company has opted to adopt this guidance early. A cumulative effect adjustment to retained earnings was recognized as of January 1, 2023 for $7,632. This adjustment brings the carrying value in line with the fair market value as of December 31, 2022. Adjustments have been recognized for all quarterly reporting periods for 2023 as of December 31, 2023 to restate the carrying value at the end of each period for the Company’s digital assets, as described in Note 5. The Company reviews long-lived assets, including software development costs and other intangible assets, for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. If an evaluation is required, the estimated future undiscounted cash flows associated with the asset are compared with the asset's carrying amount to determine if there has been an impairment, calculated as the difference between the asset’s fair value and the carrying value. Estimates of future undiscounted cash flows are based on expected growth rates for the business, anticipated future economic conditions, and estimates of residual values. Fair values take into consideration management estimates of risk-adjusted discount rates, which are believed to be consistent with assumptions that marketplace participants would use in their estimates of fair value. The Company did not recognize any impairment charges associated with the Company’s acquired intangible assets in the three and six months ended June 30, 2024 and 2023. Software Development Costs In accordance with Accounting Standards Codification (“ASC”) 350-40, Internal Use Software, the Company capitalizes certain internal-use software development costs associated with creating and enhancing internally developed software related to its platforms. Software development activities generally consist of three stages (i) the research and planning stage, (ii) the application and development stage, and (iii) the post-implementation stage. Costs incurred in the research and planning stage and in the post-implementation stage of software development, or other maintenance and development expenses that do not meet the qualification for capitalization, are expensed as incurred. Costs incurred in the application and development stage, including significant enhancements and upgrades, are capitalized. These costs include personnel and related employee benefits expenses for employees or consultants directly associated with and who devote time to software projects and external direct costs of materials obtained in developing the software. The Company also capitalizes certain costs associated with cloud computing arrangements (“CCAs”). These software developments, acquired technology, and CCA costs are amortized on a straight-line basis over the estimated useful life of five years upon the initial release of the software or additional features. The Company reviews the software development costs for impairment when circumstances indicate their carrying amounts may not be recoverable. If the carrying value of an asset group is not recoverable, the Company recognizes an impairment loss for the excess carrying value over the fair value in its consolidated statements of operations. See Note 6 for further details. Leases Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842) , established a right-of-use model that requires a lessee to record a right-of-use asset and a right-of-use liability on the balance sheet for all leases with terms longer than 12 months. Leases are classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The Company does not record leases on the balance sheet that have a lease term of 12 months or less at the commencement date. Revenue Recognition The Company generates revenue from four primary sources: (1) revenue from its managed services when a marketer (typically a brand, agency, or partner) pays the Company to provide custom content, influencer marketing, amplification, or other campaign management services (“Managed Services”); (2) revenue from fees charged to software customers on their marketplace spend within the Company's platforms (“Marketplace Spend Fees”); (3) revenue from license and subscription fees charged to access our platforms (“License Fees”); and, (4) revenue derived from other fees such as inactivity fees, early cash-out fees, and other miscellaneous fees charged to users of the Company's platforms (“Other Fees”). The Company recognizes revenue in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (“ASC 606”). Under ASC 606, revenue is recognized based on a five-step model as follows: (i) identify the contract with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) performance obligations are satisfied. The core principle of ASC 606 is that revenue is recognized when the transfer of promised goods or services to customers is made in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company applies the five-step model to contracts when it is probable that it will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are distinct performance obligations. The Company also determines whether it acts as an agent or a principal for each identified performance obligation. The determination of whether the Company acts as principal or agent is highly subjective and requires the Company to evaluate a number of indicators individually and as a whole in order to make its determination. For transactions in which the Company acts as a principal, revenue is reported on a gross basis as the amount paid by the marketer for the purchase of content or sponsorship, promotion, and other related services, and the Company records the amounts it pays to third-party creators as cost of revenue. For transactions in which the Company acts as an agent, revenue is reported on a net basis as the amount the Company charged to the self-service marketer using the Company’s platforms, less the amounts paid to the third-party creators providing the service. The Company maintains separate arrangements with each marketer and content creator either in the form of a master agreement or terms of service, which specify the terms of the relationship and access to its platforms or by statement of work, which specifies the price and the services to be performed, along with other terms. The transaction price is determined based on the fixed fee stated in the statement of work and does not contain variable consideration. Marketers who contract with the Company to manage their advertising campaigns or custom content requests may prepay for services or request credit terms. Payment terms are typically 30 days from the invoice date. The agreement typically provides for either a non-refundable deposit or a cancellation fee if the agreement is canceled by the customer prior to the completion of services. Billings in advance of completed services are recorded as a contract liability until earned. The Company assesses collectability based on several factors, including the creditworthiness of the customer and payment and transaction history. The Company does not typically engage in contracts that are longer than one year. Therefore, the Company does not capitalize costs to obtain its customer contracts as these amounts generally would be recognized over a period of less than one year and are not material. Managed Services Revenue For Managed Services Revenue, the Company enters into an agreement to provide services that may include multiple distinct performance obligations in the form of (i) an integrated marketing campaign to provide influencer marketing services, which may include the provision of blogs, tweets, photos, or videos shared through social network offerings and content promotion, such as click-through advertisements appearing in websites and social media channels, and (ii) custom content items, such as a research or news articles, informational material or videos. Marketers typically purchase influencer marketing services to provide public awareness or advertising buzz regarding the marketer’s brand and purchase custom content for internal and external use. The Company views its obligation to deliver influencer marketing services, including management services, as a single performance obligation that is satisfied over time as the customer receives the benefits from the services. The majority of revenue is recognized using an input method of costs incurred compared to total expected costs to measure the progress towards satisfying the overall performance obligation of the marketing campaign. The Company’s performance obligation in certain contracts with customers may be a stand-ready promise to provide influencer marketing services for an unknown or unspecified quantity of deliverables for a specified term. Under a stand-ready obligation, the Company’s performance obligation is satisfied over time throughout the contract term, and therefore, revenue is recognized straight-line over the life of the contract. The Company may provide one type or a combination of all types of these influencer marketing services on a statement of work for a lump sum fee. When multiple types of performance obligations exist in a contract, the Company allocates revenue to each distinct performance obligation at contract inception based on its relative standalone selling price. These performance obligations are to be provided over a period that generally ranges from one day to one year. The delivery of custom content represents a distinct performance obligation that is satisfied at a point in time when each piece of content is delivered to the customer. Based on the Company’s evaluations, revenue from Managed Services is reported on a gross basis because the Company has the primary obligation to fulfill the performance obligations, and it creates, reviews, and controls the services. The Company takes on the risk of payment to any third-party creators, and it establishes the contract price directly with its customers based on the services requested in the statement of work. Marketplace Spend Fees Revenue For Marketplace Spend Fees Revenue, the self-service customers instruct creators found through the Company’s platforms to provide and/or distribute custom content for an agreed-upon transaction price. The Company’s platforms control the contracting, description of services, acceptance of, and payment for the requested content. This service is used primarily by news agencies or marketers to control the outsourcing of their content and advertising needs. The Company charges the self-service customer the transaction price plus a fee based on the contract. Revenue is recognized when the transaction is completed by the creator and accepted by the marketer or verified as posted by the system. Based on the Company’s evaluations, this revenue is reported on a net basis since the Company is acting as an agent through its platform for the third-party creator to provide the services or content directly to the self-service customer or to post approved content through one or more social media platforms. License Fees Revenue License Fees Revenue is generated by granting customers limited, non-exclusive, non-transferable access to the Company’s technology platforms for an agreed-upon subscription period. Customers access the platforms to manage their influencer marketing campaigns. Fees for subscription or licensing services are recognized straight-line over the term of the service. Other Fees Revenue Other Fees Revenue is generated when fees are charged to the Company’s platform users primarily related to monthly plan fees, which are recognized within the month they relate to. Advertising Costs Advertising costs are charged to expense as they are incurred, including payments to content creators to promote the Company. Advertising costs for the three months ended June 30, 2024 and 2023 were approximately $0.9 million and $0.8 million, respectively. Advertising costs charged to operations for the six months ended June 30, 2024, and 2023 were approximately $1.5 million and $1.3 million, respectively. Advertising costs are included in sales and marketing expense in the accompanying consolidated statements of operations. Income Taxes Deferred income taxes are accounted for using the balance sheet approach, which requires recognition of deferred tax assets and liabilities for the expected future consequences of temporary differences between the financial reporting basis and the tax basis of assets and liabilities. A valuation allowance is provided when it is more likely than not that a deferred tax asset will not be realized. The Company incurs state franchise tax in ten states, which is included in general and administrative expense in the consolidated statements of operations and comprehensive loss. The Company identifies and evaluates uncertain tax positions, if any, and recognizes the impact of uncertain tax positions for which there is a less than more likely-than-not probability of the position being upheld when reviewed by the relevant taxing authority. Such positions are deemed to be unrecognized tax benefits, and a corresponding liability is established on the balance sheet. The Company has not recognized a liability for uncertain tax positions. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The Company’s tax years subject to examination based on the statute of limitations by the IRS is generally three years; however, the IRS may examine records and other evidence from the year the net operating loss was generated when the Company utilizes net operating loss carryforwards in future periods. The Company’s tax years subject to examination by the Canadian Revenue Agency and the Australian Taxation Office is generally four years. Fair Value of Financial Instruments The Company’s financial instruments are recorded at fair value. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The valuation techniques are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect certain market assumptions. There are three levels of inputs that may be used to measure fair value: • Level 1 – Valuation based on quoted market prices in active markets for identical assets and liabilities. • Level 2 – Valuation based on quoted market prices for similar assets and liabilities in active markets. • Level 3 – Valuation based on unobservable inputs that are supported by little or no market activity, therefore requiring management’s best estimate of what market participants would use as fair value. Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management. As of June 30, 2024, the Company holds Level 1 and Level 2 financial assets; this is discussed further in Note 3 - Financial Instruments of Notes to the Consolidated Financial Statements. Stock-Based Compensation Stock-based compensation cost related to stock options granted under the 2011 Equity Incentive Plan, as amended, (the “2011 Equity Incentive Plan”), and the Inducement Plan (see Note 10) is measured at the grant date, based on the fair value of the award, and is recognized as expense over the employee’s requisite service period on a straight-line basis. The Company estimates the fair value of each option award on the date of grant using a Black-Scholes option-pricing model that uses the assumptions noted in the table below. The Company uses the simplified method to estimate the expected term of employee stock options because it does not believe historical exercise data will provide a reasonable basis for estimating the expected term for the current share options granted. The simplified method assumes that employees will exercise share options evenly between the period when the share options are vested and ending on the date when the options would expire. The Company uses the closing stock price of its common stock on the date of the grant as the associated fair value of its common stock. The Company uses the risk-free interest rate on the implied yield currently available on U.S. Treasury issues with an equivalent remaining term approximately equal to the expected life of the award. The Company has never paid any cash dividends on its common stock and does not anticipate paying any cash dividends in the foreseeable future. The Company estimates forfeitures when recognizing compensation expense and this estimate of forfeitures is adjusted over the requisite service period based on the extent to which actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures are recognized through a cumulative catch-up adjustment, which is recognized in the period of change, and a revised amount of unamortized compensation expense to be recognized in future periods. The Company may issue shares of restricted stock or restricted stock units (“RSUs”) that vest over future periods. The value of shares is recorded as the fair value of the stock or units upon the issuance date and is expensed on a straight-line basis over the vesting period. See Note 10 for additional information related to these shares. On November 30, 2023, the IZEA Board of Directors adopted the IZEA Worldwide, Inc. 2023 Inducement Plan (the “Inducement Plan”) to accommodate equity grants to new employees hired by IZEA in connection with acquisition transactions, including the Hoozu acquisition. Under the Inducement Plan, IZEA may grant, subject to certain requirements, RSUs, including performance-based and time-based RSUs, covering up to a total of 1,800,000 shares of IZEA common stock to new employees of IZEA or its subsidiaries. See Note 10 for additional information related to shares issued under both plans. Business Combinations and Asset Acquisitions The Company accounts for business combinations in accordance with Accounting Standards Codification (ASC) Topic 805, “Business Combinations.” The acquisition method of accounting is applied to all business combinations, whereby the identifiable assets acquired, liabilities assumed, and any non-controlling interests in the acquiree are recognized and measured at their fair values as of the acquisition date. Goodwill represents the excess of the purchase price over the fair value of net identifiable assets acquired and liabilities assumed in a business combination. Goodwill is allocated to reporting units, which are expected to benefit from the synergies of the combination and is subject to annual impairment testing. Acquisition-related costs, including advisory, legal, a |
Business Acquisitions
Business Acquisitions | 6 Months Ended |
Jun. 30, 2024 | |
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] | |
Business Acquisitions | BUSINESS ACQUISITIONS Hoozu Holdings, LTD. On December 1, 2023, the Company completed the announced acquisition of Hoozu Holdings, LTD (now Hoozu Holdings Pty Ltd.)(“Hoozu”) from Hoozu investors. Hoozu is a leading Australian influencer marketing company headquartered in Sydney. The company serves a roster of the region’s most innovative brands, including Bunnings, Emma Sleep, Super Cheap Auto, and Ryobi. In addition to its core services, Hoozu’s talent management division, called Huume, represents creators in the Australian market. The net purchase price was approximately $2.5 million, including cash consideration of $0.6 million and 726,210 shares of common stock, valued at approximately $1.7 million at the acquisition date, based on the closing market share price on the acquisition date. Approximately $150,000 of transaction-related costs are separately recorded in general and administrative costs in the accompanying consolidated statement of operations for the year ended December 31, 2023. The Company accounted for the acquisition in accordance with ASC 805, which requires the assets acquired and liabilities assumed to be recognized on the balance sheet at their fair values as of the acquisition date. Gross Purchase Consideration Initial Present and Fair Value Estimated Remaining Present and Fair Value 12/1/2023 12/1/2023 06/30/2024 Cash paid at closing $ 595,411 $ 595,411 — Stock issued at closing 1,746,535 1,746,535 — First deferred purchase price installment (1) 114,400 — — Second deferred purchase price installment (1) 60,600 — — Total estimated consideration $ 2,516,946 $ 2,341,946 $ — (1) The Company’s acquisition of Hoozu on December 1, 2023, included four equal contingent cash consideration payments totaling $396,940, with twelve-month measurement periods ending December 31, 2024 and 2025. The contingent payments are based on meeting minimum Revenue and Adjusted Earnings before Taxes and Depreciation thresholds for each measurement period. The contingent payments are hit-or-miss, with the first measurement period payments carrying a make-up provision during the second measurement period. The Company determined the fair value of these contingent payments, using Monte Carlo simulation methods, to be $175,000 at the acquisition date, subject to periodic adjustment until both measurement periods are completed. During the quarter that ended June 30, 2024, the Company determined that based upon the lag behind Hoozu’s revenue and profitability growth, achieving the deferred purchase price targets for both 2024 and 2025 is not probable and accordingly reduced these installment balances to their expected payout value. The table below presents the provisional fair values on December 1, 2023, allocated to the assets acquired and liabilities assumed. The purchase accounting and purchase price allocation for Hoozu are complete. The fair values are presented in the following table: Estimated Approximate Fair Value 12/1/2023 Accounts receivable $ 419,336 Prepaid expenses 15,750 Property and equipment, net 9,033 Intangible assets Tradename 668,000 Customer list 935,000 Goodwill 1,265,155 Deferred tax liability (400,750) Accounts payable (718,515) Current liabilities (930,655) Purchase consideration, excluding cash received $ 1,262,354 Plus: cash received 1,254,592 Total purchase considerations $ 2,516,946 Accounts receivable shown in the table above represent their gross amount, which approximates the fair value, and are expected to be collected in full. The significant fair value estimates included in the provisional allocation of purchase price are discussed below. Other Intangible Assets Other intangible assets with definite lives include acquired customer relationships of $0.9 million and tradename of $0.7 million. The preliminary customer-related intangible assets’ fair value was determined by using the income approach, while the tradename fair value was determined utilizing the relief from the royalty method. Acquired customer relationships and tradename generally have useful lives of 10 years, unless shorter periods are warranted, and are amortized to operating costs on an accelerated basis. Goodwill The excess of consideration for Hoozu over the preliminary net fair value of assets acquired and liabilities assumed resulted in the provisional recognition of $1.3 million of goodwill, which is not deductible for tax purposes. Goodwill is primarily attributable to the assembled workforce and synergies. Contingent Liability Contingent liability purchase price installments, which total $396,940 based on meeting certain revenue and EBITDA milestones for 2024 and 2025, were recorded at their fair value of $175,000 at the acquisition date. The contingent liability value is subject to periodic adjustment until both measurement dates are completed. No adjustment was recorded in December 2023. As of June 30, 2024, the Company reassessed the fair value of the contingent performance-based consideration related to the earnout provision of the acquisition of Hoozu. Based on actual performance to date, and revised projections of Hoozu’s business performance, it was determined that the contingent milestones were no longer probable of being achieved. Consequently, the contingent liability was adjusted to the expected payout value, resulting in a gain of $175,000 recognized as a reduction to general and administrative expense in the consolidated statements of income. This adjustment reflects our updated expectation of future performance and aligns with the requirements of ASC 805. Privatization of Hoozu Holdings, Ltd On March 27, 2024, Hoozu Holdings, Ltd was privatized and restructured to become Hoozu Holdings Pty, Ltd. This change reflects a strategic shift to streamline operations and focus on long-term growth objectives. Zuberance On December 1, 2023, the Company entered into an Asset Purchase Agreement (the “Agreement”) with Zuberance, Inc., a Delaware corporation (“Zuberance”). Zuberance is a pioneering advocate marketing software platform. Zuberance provides marketers with the tools to build white-label communities of their customers and influencers while engaging these communities to serve as advocates for their brand, leading to low-cost content creation. The net purchase price was $18,400 in cash consideration, allocated to the fair value of assets acquired and liabilities assumed, as shown in the following table: Estimated Fair Value 12/31/2023 Intangibles-customer relationships $ 162,725 Current liabilities (58,138) Deferred revenue (86,187) Total purchase price $ 18,400 The customer-related intangible assets’ fair value was determined by using the income approach, has an estimated useful life of 5 years, and will be amortized to operating expenses on an accelerated basis. |
Financial Instruments
Financial Instruments | 6 Months Ended |
Jun. 30, 2024 | |
Investments, Debt and Equity Securities [Abstract] | |
Financial Instruments | FINANCIAL INSTRUMENTS Cash, Cash Equivalents, and Marketable Securities (Available for Sale) The Company has engaged a third party registered investment advisor and appointed a leading national bank for custody services with respect to investment securities. Investments comply with the Company’s revised investment strategy policy, designed to preserve capital, minimize investment risks, and maximize returns. The following table shows the Company’s cash, cash equivalents, and marketable securities by significant investment category as of June 30, 2024: Adjusted Cost Unrealized Gains Unrealized Losses Fair Value Cash and Cash Equivalents Current Marketable Securities (1) Non-Current Marketable Securities (2) Cash and cash equivalents $ 10,223,685 $ — $ — $ 10,223,685 $ 10,223,685 $ — $ — Level 1 (3) Commercial paper 5,199,435 — (2,309) 5,197,126 5,197,126 — — Money market funds 28,881,055 — — 28,881,055 28,881,055 — — US Treasury securities 2,014,955 — (21,572) 1,993,383 — 1,993,383 — Subtotal 36,095,445 — (23,881) 36,071,564 34,078,181 1,993,383 — Level 2 (4) Asset back securities 2,375,823 — (19,309) 2,356,514 — 1,459,487 897,027 Corporate debt securities 7,890,176 5,275 (61,868) 7,833,583 — 7,833,583 — Subtotal 10,265,999 5,275 (81,177) 10,190,097 — 9,293,070 897,027 Total $ 56,585,129 $ 5,275 $ (105,058) $ 56,485,346 $ 44,301,866 $ 11,286,453 $ 897,027 (1) Current Marketable Securities have a holding period under one year. (2) Non-Current Marketable Securities have a holding period over one year. The securities held by IZEA Worldwide, Inc. mature between one (3) Level 1 fair value estimates are based on quoted prices in active markets for identical assets and liabilities. (4) Level 2 fair value estimates are based on observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets and 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 assets and liabilities. The Company records the fair value of cash equivalents and marketable securities on the balance sheet. The adjusted cost, which includes unrealized gains and losses, reflects settlement amounts if all investments are held to maturity. The Company did not recognize any realized gains (net of losses) for the three and six months ended June 30, 2024, and 2023. Realized gains and losses are a component of other income (expense), net. Unrealized gains and losses are a component of other comprehensive income (loss) (“OCI”). The following table summarizes the estimated fair value of investments in marketable debt securities by stated contractual maturity dates: As of June 30, 2024 As of December 31, 2023 Due in 1 year or less $ 11,286,453 $ 17,126,057 Due in 1 year through 5 years 897,027 9,618,996 Total $ 12,183,480 $ 26,745,053 The following table presents fair values and net unrealized gains (losses) recorded to OCI, aggregated by investment category: June 30, 2024 December 31, 2023 Fair Value Net Unrealized Gain (Loss) Fair Value Net Unrealized Gain (Loss) Cash and cash equivalents $ 44,301,866 $ (2,309) $ 37,446,728 $ — Government bonds 1,993,383 (21,572) 6,939,713 (79,840) Corporate debt securities 7,833,583 (56,593) 16,196,931 (124,431) Asset backed securities 2,356,514 (19,309) 3,608,409 (46,320) Total $ 56,485,346 $ (99,783) $ 64,191,781 $ (250,591) During the three and six months ended June 30, 2024, the Company did not recognize any credit losses and had no ending allowance balance for credit losses. |
Property and Equipment
Property and Equipment | 6 Months Ended |
Jun. 30, 2024 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | PROPERTY AND EQUIPMENT Property and equipment consist of the following: June 30, 2024 December 31, 2023 Furniture and fixtures $ 29,848 $ 29,848 Office equipment 8,506 8,506 Computer equipment 282,898 281,950 Total 321,252 320,304 Less accumulated depreciation (165,417) (114,927) Property and equipment, net $ 155,835 $ 205,377 Depreciation expense on property and equipment recorded in depreciation and amortization expense in the consolidated statements of operations and comprehensive loss was $26,701 and $27,160 for the three months ended June 30, 2024 and 2023, respectively, and was $53,258 and $45,946 for the six months ended June 30, 2024 and 2023, respectively. |
Intangible Assets
Intangible Assets | 6 Months Ended |
Jun. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | INTANGIBLE ASSETS Definite Lived Intangible Assets Definite lived intangible assets, net of amortization as of June 30, 2024 and December 31, 2023 totaled $1.8 million and $1.8 million, respectively. June 30, 2024 December 31, 2023 Balance Accumulated Amortization Net Book Value Balance Accumulated Amortization Net Book Value Useful Life in years Trade names $ 668,213 $ 48,581 $ 619,632 $ 668,000 $ 5,567 $ 662,433 10 Customer lists Hoozu 935,294 69,010 866,284 935,000 7,791 927,209 10 Zuberance 162,508 23,473 139,035 162,508 2,709 159,799 5 Total definite-lived intangible assets $ 1,766,015 $ 141,064 $ 1,624,951 $ 1,765,508 $ 16,067 $ 1,749,441 Total intangible assets from the Company’s acquisitions and other acquired assets net of accumulated amortization thereon consists of the following: June 30, 2024 December 31, 2023 Hoozu intangible assets $ 1,603,507 $ 1,603,000 Zuberance intangible assets 162,508 162,508 Total $ 1,766,015 $ 1,765,508 Less accumulated amortization (141,064) (16,067) Intangible assets, net $ 1,624,951 $ 1,749,441 As of June 30, 2024, future estimated amortization expense related to identifiable assets is set forth in the following schedule: Future Amortization of Intangible Assets Amount Remainder of 2024 155,325 2025 257,032 2026 232,877 2027 208,721 2028 184,566 2029+ 586,430 Total $ 1,624,951 There were no impairment charges associated with the Company’s identifiable intangible assets, other than digital assets, in the six months ended June 30, 2024, and 2023. Amortization expense recorded in depreciation and amortization in the accompanying consolidated statements of operations and comprehensive loss was $124,996 and $0 for the six months ended June 30, 2024 and 2023, respectively. Digital Assets During the three months ended June 30, 2024 and 2023, the Company did not transact in digital assets nor did the Company impair the value of its digital assets. As of June 30, 2024 , the Company held $143,436 of Bitcoin and $99,584 of Ethereum with total holdings in digital assets of $243,020 . The Company recorded a loss of $26,044 and a gain $80,115 for the three and six months ended June 30, 2024, respectively. The Company determines the fair value of its digital assets on a recurring basis in accordance with ASU 2023-8, Accounting for and Disclosure of Crypto Assets , based on quoted prices on the active exchange(s) that has been determined to be the principal market for such assets (Level 1 inputs). The Company performs an analysis monthly to identify whether the fair market value of the digital assets has changed. If the then-current carrying value of a digital asset is different from the fair value so determined, an adjustment in the amount equal to the difference between their carrying value and the price determined is recognized. Gains and losses on digital assets are recognized within other income in the consolidated statements of operations and comprehensive loss in the period in which the change to fair market value is identified. In determining the gain to be recognized upon sale, the Company calculates the difference between the sales price and carrying value of the digital assets sold immediately prior to sale. Goodwill The Company’s goodwill balance changed as follows: Amount Balance on December 31, 2022 $ 4,016,722 Acquisitions during 2023 1,265,155 Currency translation adjustment $ (1,505) Balance on December 31, 2023 $ 5,280,372 Currency translation adjustment 1,516 Balance on June 30, 2024 $ 5,281,888 The Company completed its acquisition of Hoozu on December 1, 2023. While Hoozu’s business is reported together with our Managed Services business, it will be treated as a separate component for Goodwill impairment testing. The Company performs an annual impairment assessment of goodwill on October 1 each year or more frequently, if certain indicators are present. There were no impairment charges associated with the Company’s Goodwill in the three and six months ended June 30, 2024 and 2023. |
Software Development Costs
Software Development Costs | 6 Months Ended |
Jun. 30, 2024 | |
Research and Development [Abstract] | |
Software Development Costs | SOFTWARE DEVELOPMENT COSTS Software development costs consist of the following: June 30, 2024 December 31, 2023 Software development costs $ 5,827,554 $ 5,390,403 Less accumulated amortization (3,586,117) (3,333,431) Software development costs, net $ 2,241,437 $ 2,056,972 In 2022, the Company began developing two new web-based influencer marketing platforms, Flex and Marketplace, to replace IZEAx and Shake, respectively. IZEAx was sunset in mid-2023, and Shake was sunset in Q4 of 2022. The Company capitalized software development costs of $363,474 and $437,152 during the three and six months ended June 30, 2024, respectively. The Company capitalized software development costs of $281,009 and $437,877 during the three and six months ended June 30, 2023, respectively. As a result, the Company has capitalized a total of $5.8 million in direct materials, consulting, payroll, and benefit costs to its internal-use software development costs in the consolidated balance sheet as of June 30, 2024. The Company amortizes its software development costs, commencing upon initial release of the software or additional features, on a straight-line basis over the estimated useful life of five years, which is consistent with the amount of time its legacy platforms were in service, or its actual useful life, if shorter. The Company recorded amortization expense associated with its capitalized software development cost of $124,381 and $83,272 during the three months ended June 30, 2024 and 2023, respectively. The Company recorded amortization expense associated with its capitalized software development cost of $252,686 and $410,748 during the six months ended June 30, 2024 and 2023, respectively. As of June 30, 2024, future estimated amortization expense related to software development costs is set forth in the following schedule: Software Development Amortization Expense 2024 249,961 2025 566,654 2026 560,906 2027 526,871 2028 257,843 2029 79,202 Total $ 2,241,437 |
Accrued Expenses
Accrued Expenses | 6 Months Ended |
Jun. 30, 2024 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | ACCRUED EXPENSES Accrued expenses consist of the following: June 30, 2024 December 31, 2023 Accrued payroll liabilities $ 2,469,962 $ 2,153,617 Accrued taxes 90,773 253,677 Current portion of finance obligation 59,386 59,386 Accrued other 541,708 616,780 Total accrued expenses $ 3,161,829 $ 3,083,460 |
Notes Payable
Notes Payable | 6 Months Ended |
Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
Notes Payable | NOTES PAYABLE Finance Obligation The Company pays for its laptop computer equipment through long-term payment plans, using an imputed interest rate of 7.8%, based on its incremental borrowing rate, to determine the present value of its financial obligation and to record interest expense over the term of the plan. The Company refreshed a portion of its computer inventory during the fourth quarter of 2022, entering a new three-year payment plan with the same vendor. The total balance owed was $93,113 and $122,805 as of June 30, 2024 and December 31, 2023, respectively, with the short-term portion of $59,386 and $59,386 recorded under accrued expenses in the consolidated balance sheets as of June 30, 2024 and December 31, 2023, respectively. Summary Interest expense on financing arrangements recorded in the Company’s consolidated statements of operations was $4,000 and $3,103 during the six months ended June 30, 2024 and 2023, respectively. As of June 30, 2024, the future contractual maturities of the Company’s long-term payment obligations by year are set forth in the following schedule: 2024 $ 29,693 2025 56,683 2026 6,737 Total $ 93,113 |
Commitments and Contingencies (
Commitments and Contingencies (Notes) | 6 Months Ended |
Jun. 30, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Deferred Purchase Price The Company’s acquisition of Hoozu on December 1, 2023 included four equal contingent cash consideration payments totaling $396,940, with twelve-month measurement periods ending December 31, 2024 and 2025. The contingent payments are based on meeting minimum Revenue and Adjusted Earnings before Taxes and Depreciation thresholds for each measurement period. The contingent payments are hit-or-miss, with the first measurement period payments carrying a make-up provision during the second measurement period. The Company determined the fair value of these contingent payments to be $175,000, subject to quarterly adjustment until both measurement periods are completed. As of June 30, 2024, the Company reassessed the fair value of the contingent performance-based consideration related to the earnout provision of the acquisition of Hoozu. Based on actual performance to date, and revised projections of Hoozu’s business performance, it was determined that achieving the contingent milestones was no longer probable. Consequently, the contingent liability was written off, resulting in a gain of $175,000 recognized as a reduction to general and administrative expense in the consolidated statements of income. This adjustment reflects our updated expectation of future performance and aligns with the requirements of ASC 805. The fair value will continue to be subject to quarterly assessment until the completion of both measurement periods. Lease Commitments The Company does not have any operating or finance leases greater than 12 months in duration as of June 30, 2024. Retirement Plans The Company offers a 401(k) plan to all of its eligible employees. The Company matches participant contributions in an amount equal to 50% of each participant’s contribution up to 8% of the participant’s salary. The participants become vested in 20% annual increments after two years of service, or fully vest upon the age of 60. Total expense for employer matching contributions during the three and six months ended June 30, 2024 and 2023 was recorded in the Company’s consolidated statements of operations as follows: Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, Cost of revenue $ 19,722 $ 19,643 $ 42,200 $ 44,276 Sales and marketing 17,191 17,799 60,230 33,416 General and administrative 48,018 41,875 92,602 77,827 Total contribution expense $ 84,931 $ 79,317 $ 195,032 $ 155,519 Litigation |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Stockholders' Equity | STOCKHOLDERS’ EQUITY Authorized Shares The Company has 50,000,000 authorized shares of common stock and 10,000,000 authorized shares of preferred stock, each with a par value of $0.0001 per share. 500,000 shares of preferred stock are designated as Series A Junior Participating Preferred Stock. Share Repurchase On March 30, 2023, the Company announced that its Board of Directors had authorized a $1.0 million share repurchase program of the Company’s common stock. During the repurchase program, the Company purchased 365,855 shares of the Company’s common stock on the open market with an average price per share of $1.23, for a total of $1.0 million. Shares purchased before June 16, 2023 have been adjusted for the reverse stock split. Repurchased shares have the status of treasury shares and may be issued, if and when needed, for general corporate purposes. The repurchase program was completed in August 2023. On June 28, 2024, the Company announced that its Board of Directors had authorized a $5.0 million share repurchase program of the Company’s common stock. The repurchase program is subject to market conditions and the Company’s inside trading windows. As of June 30, 2024, no shares had been repurchased under the program. Reverse Stock Split In June 2023, the number of authorized shares and shares of common stock held by each stockholder of the Company were consolidated automatically into the number of shares of common stock equal to the number of issued and outstanding shares of common stock held by each such stockholder immediately prior to the reverse split divided by four (4): effecting a four (4) old for one (1) new reverse stock split. Any fractional shares resulting from the reverse stock split were rounded up to the nearest whole share, resulting in 23,789 additional shares being issued. No shares of preferred stock were outstanding at the time of the reverse stock split. Additionally, all options and unvested restricted share grants of the Company outstanding immediately prior to the reverse split were adjusted by dividing the number of shares of common stock into which the options are exercisable by four (4) and multiplying the exercise price by four (4), in accordance with the terms of the plans and agreements governing such options and subject to rounding up to the nearest whole share. All shares of common stock, stock options, restricted stock, and restricted stock unit grants, and their corresponding price per share amounts have been presented to reflect the reverse split in all periods presented within this Quarterly Report on Form 10-Q. Equity Incentive Plan The Company’s stockholders approved an amendment and restatement of the 2011 Equity Incentive Plan at the Company’s 2023 Annual Meeting of Stockholders held on October 17, 2023, to increase the number of plan shares by 1,800,000 shares, from 1,875,000 to 3,675,000 shares. As of June 30, 2024, the Company had 974,985 remaining shares of common stock available for issuance pursuant to future grants under the 2011 Equity Incentive Plan. Restricted Stock Under the 2011 Equity Incentive Plan, the Board determines the terms and conditions of each restricted stock issuance, including any future vesting restrictions. In 2023, the Company issued its five independent directors a total of shares of restricted common stock initially valued at $300,015 for their annual service as directors of the Company. The stock was granted in installments on the last day of each quarter and vested immediately. In the three and six months ended June 30, 2024, the Company issued its five independent directors a total of 31,915 and 64,385 shares of restricted common stock, respectively, with an aggregate grant date valuation of $150,006 for their service as directors of the Company. Approximately $75,000 worth of shares are granted on the last day of each quarter and vest immediately. The following table contains summarized information about restricted stock issued during the year ended December 31, 2023 and the six months ended June 30, 2024: Restricted Stock Common Shares Weighted Average Weighted Average Nonvested at December 31, 2022 72 $ 5.36 0.3 Granted 131,520 2.28 Vested (131,592) 2.28 Nonvested at December 31, 2023 — $ — 0.0 Granted 64,385 2.33 Vested (64,385) 2.33 Nonvested at June 30, 2024 — $ — 0.0 Although restricted stock is issued upon the grant of an award, the Company excludes restricted stock from the computations within the financial statements of total shares outstanding and basic earnings per share until such time as the restricted stock vests. Expense recognized on restricted stock issued to directors for services was $75,000 and $75,009 during the three months ended June 30, 2024, and 2023, respectively and $150,006 and $150,009 during the six months ended June 30, 2024, and 2023, respectively. There was no expense recognized on restricted stock issued to employees during the three months ended June 30, 2024, and 2023, respectively and $0 and $376 during the six months ended June 30, 2024, and 2023, respectively. On June 30, 2024, the fair value of the Company’s common stock was approximately $2.35 per share and the intrinsic value on the non-vested restricted stock was $0. Future compensation expense related to issued, but non-vested, restricted stock awards as of June 30, 2024, is $0. Restricted Stock Units The Board determines the terms and conditions of each restricted stock unit award issued under the 2011 Equity Incentive Plan. During the six months ended June 30, 2024, the Company issued a total of 475,713 restricted stock units initially valued at $1,079,016 to non-executive employees as additional incentive compensation. The restricted stock units vest between 12 and 36 months from issuance. During the six months ended June 30, 2024, the Company issued a total of 221,232 restricted stock units initially valued at $516,307 to executives as additional incentive compensation. The restricted stock units vest between 12 and 48 months from issuance. The following table contains summarized information about restricted stock units during the year ended December 31, 2023 and the six months ended June 30, 2024: Restricted Stock Units Common Shares Weighted Average Weighted Average Nonvested at December 31, 2022 329,070 $ 3.79 2.5 Granted 870,191 2.38 Vested (163,085) 3.55 Forfeited (73,327) 3.18 Nonvested at December 31, 2023 962,849 $ 2.60 2.5 Granted 696,945 2.25 Vested (151,587) 3.03 Forfeited (88,870) 2.28 Nonvested at June 30, 2024 1,419,337 $ 2.40 1.2 Expense recognized on restricted stock units issued to employees was $349,385 and $151,733 during the three months ended June 30, 2024 and 2023, respectively and $650,599 and $281,299 during the six months ended June 30, 2024 and 2023, respectively. On June 30, 2024, the fair value of the Company’s common stock was approximately $2.35 per share and the intrinsic value on the non-vested restricted units was $3,335,442. Future compensation related to the non-vested restricted stock units as of June 30, 2024 is $2,930,090 and it is estimated to be recognized over the weighted-average vesting period of approximately 1.2 years. Stock Options Under the 2011 Equity Incentive Plan, the Board determines the exercise price to be paid for the stock option shares, the period within which each stock option may be exercised, and the terms and conditions of each stock option. The exercise price of incentive and non-qualified stock options may not be less than 100% of the fair market value per share of the Company’s common stock on the grant date. If an individual owns stock representing more than 10% of the outstanding shares, the exercise price of each share of an incentive stock option must be equal to or exceed 110% of fair market value. Unless otherwise determined by the Board at the time of grant, the exercise price is set at the fair market value of the Company’s common stock on the grant date (or the last trading day prior to the grant date, if it is awarded on a non-trading day). Additionally, the term is set at ten years and the option typically vests on a straight-line basis over the requisite service period as follows: 25% one year from the date of grant with the remaining vesting monthly in equal increments over the following three years. The Company issues new shares for any stock awards or options exercised under its 2011 Equity Incentive Plan. A summary of option activity under the 2011 Equity Incentive Plan during the year ended December 31, 2023, and the six months ended June 30, 2024, is presented below: Options Outstanding Common Shares Weighted Average Weighted Average Outstanding at December 31, 2022 415,562 $ 11.31 5.3 Granted — — Exercised (586) 0.96 Expired (71,013) 19.99 Forfeited (362) 7.75 Outstanding at December 31, 2023 343,601 $ 9.53 5.2 Granted — — Exercised (313) 2.24 Expired (458) 6.88 Forfeited (51) 6.57 Outstanding at June 30, 2024 342,779 $ 9.54 4.7 Exercisable at June 30, 2024 330,658 $ 9.55 4.7 During the six months ended June 30, 2024, 313 options were exercised for gross proceeds of $701. The intrinsic value of the exercised options was $50. During the six months ended June 30, 2023, 0 options were exercised for gross proceeds of $0. The intrinsic value of the exercised options was $0. The fair value of the Company's common stock on June 30, 2024 was approximately $2.35 per share, and the intrinsic value on outstanding options as of June 30, 2024 was $74,149. The intrinsic value of the exercisable options as of June 30, 2024 was $74,149. A summary of the nonvested stock option activity under the 2011 Equity Incentive Plan during the year ended December 31, 2023, and the six months ended June 30, 2024, is presented below: Nonvested Options Common Shares Weighted Average Weighted Average Nonvested at December 31, 2022 72,474 $ 5.80 1.7 Granted — — Vested (31,474) 9.53 Forfeited (14,627) 19.99 Nonvested at December 31, 2023 26,373 $ 8.83 1.1 Granted — — Exercised — — Vested (14,201) 9.55 Forfeited (51) 6.57 Nonvested at June 30, 2024 12,121 $ 9.53 0.9 There were outstanding options to purchase 342,779 shares with a weighted average exercise price of $9.54 per share, of which options to purchase 330,658 shares were exercisable with a weighted average exercise price of $9.55 per share as of June 30, 2024. Expense recognized on stock options issued to employees during the six months ended June 30, 2024 and 2023 was $96,479 and $119,124, respectively and $44,514 and $54,780 for the three months ended June 30, 2024 and 2023, respectively. Future compensation related to non-vested awards as of June 30, 2024 is $93,369, and it is estimated to be recognized over the weighted-average vesting period of approximately 0.9 years. No stock options were granted under the 2011 Equity Incentive Plan in the six months ended June 30, 2024 and 2023. Inducement Plan On November 30, 2023, the Board of Directors adopted the IZEA Worldwide, Inc. 2023 Inducement Plan (the “Inducement Plan”) to accommodate equity grants to new employees hired by IZEA in connection with acquisition transactions, including the Hoozu acquisition. Under the Inducement Plan, IZEA may grant restricted stock units (“RSUs”), including performance-based and time-based RSUs, with respect to up to a total of 1,800,000 shares of IZEA common stock to new employees of IZEA or its subsidiaries. Pursuant to Rule 5635(c)(4) of the NASDAQ Listing Rules, the Inducement Plan was adopted without stockholder approval. In accordance with Rule 5635(c)(4) of the NASDAQ Listing Rules, awards under the Inducement Plan can only be made to individuals not previously employees or non-employee directors of IZEA (or following such individuals’ bona fide period of non-employment with IZEA), as an inducement material to the individuals’ entry into employment with IZEA or in connection with a merger or acquisition, to the extent permitted by Rule 5635(c)(3) of the NASDAQ Listing Rules. On December 1, 2023, the Board approved the grant of inducement awards under the Inducement Plan to five employees of Hoozu consisting of an aggregate of 328,354 performance-based RSUs as inducement awards material to such employees’ entering into employment with IZEA, pursuant to Rule 5635(c)(4) of the NASDAQ Listing Rules. The RSU grants, which vest in annual increments over a three-year performance period based upon the achievement of certain revenue and profitability metrics, represent the maximum number of shares that can be earned under the awards. Vesting is also subject to the receipt’s continued service through each annual vesting date. Unearned RSUs will be forfeited if the minimum revenue in each period is not achieved. Each award is subject to the terms and conditions of the Inducement Plan and the terms and conditions of the applicable RSU award agreement covering the grant. Separately, on December 1, 2023, the IZEA Board approved the grant of an inducement award under the Inducement Plan in connection with the asset purchase from Zuberance consisting of 10,000 time-based RSUs as an inducement award material to such employee’s entering into employment with IZEA. As of June 30, 2024, an aggregate of 338,354 performance-based and time-based restricted stock unit awards have been granted in conjunction with our acquisitions, none of which have vested. Employee Stock Purchase Plan The amended and restated IZEA Worldwide, Inc. 2014 Employee Stock Purchase Plan (the “ESPP”) provides for the issuance of up to 125,000 shares of the Company’s common stock to employees regularly employed by the Company for 90 days or more on a full-time or part-time basis (20 hours or more per week on a regular schedule). The ESPP operates in successive six-month periods commencing at the beginning of each fiscal year half. Each eligible employee who elects to participate may purchase up to 10% of their annual compensation in common stock not to exceed $21,250 annually or 2,000 shares per offering period. The purchase price will be the lower of (i) 85% of the fair market value of a share of common stock on the first day of the offering period or (ii) 85% of the fair market value of a share of common stock on the last day of the offering period. The ESPP will continue until January 1, 2028, unless otherwise terminated by the Board. During the three months ended June 30, 2024 and 2023, employees paid $5,206 to purchase 3,047 shares of common stock and $7,992 to purchase 4,329 shares of common stock, respectively. During the six months ended June 30, 2024 and 2023, employees paid $5,206 to purchase 3,047 shares of common stock and $7,992 to purchase 4,329 shares of common stock, respectively. The stock compensation expense on ESPP Options was $1,031 and $1,361 for the three months ended June 30, 2024 and 2023, respectively, and $2,041 and $2,599 for the six months ended June 30, 2024 and 2023, respectively. As of June 30, 2024, the Company had 77,931 remaining shares of common stock available for future issuances under the ESPP. Shareholder Rights Plan On May 28, 2024, the Board of Directors declared a dividend to the holders of the Company’s common stock outstanding at the close of business on June 7, 2024 (the “Record Date”) of one preferred share purchase right (a “Right”) for each share of common stock. Each Right initially entitles the registered holder to purchase from the Company one one-thousandth of a share of Series A Junior Participating Preferred Stock, par value $0.001 per share (the “Preferred Shares”), at a price of $8.25 per one one-thousandth of a Preferred Share (the “Purchase Price”), subject to adjustment. The description and terms of the Rights are set forth in a Rights Agreement (the “Rights Agreement”), dated May 28, 2024 between the Company and Broadridge Corporate Issuer Solutions, LLC, as rights agent (the “Rights Agent”). Initially, the Rights are attached to all common stock certificates outstanding as of the Record Date, and evidenced by such shares being registered in the name of the holder thereof together with the Summary of Rights, and no separate certificates evidencing the Rights (“Right Certificates”) will be issued. The Rights Agreement provides that, until the Distribution Date (as defined below), or earlier expiration or redemption of the Rights, (i) the Rights will be transferred with and only with the common stock, (ii) new Common Share certificates issued after the Record Date or upon transfer or new issuance of common stock will contain a legend incorporating the Rights Agreement by reference, and (iii) the surrender for transfer of any certificates for common stock outstanding as of the Record Date, even without such legend or a copy of the Summary of Rights, will also constitute the transfer of the Rights associated with the common stock represented by such certificate. The Rights would separate and begin trading separately from the common stock, and Right Certificates will be caused to evidence the rights on the earlier to occur of (i) the close of business on the tenth (10th) business day after a public announcement that a person or group of affiliated or associated persons (with certain exceptions noted below, an “Acquiring Person”) has acquired beneficial ownership of 15% or more of the outstanding common stock and (ii) the close of business on the tenth (10th) business day after the commencement by any person of, or of the first public announcement of the intention of any person to commence, a tender or exchange offer the consummation of which would result in such person becoming the beneficial owner of 15% or more of the outstanding shares of common stock (the earlier of such dates being called the “Distribution Date”). As soon as practicable following the Distribution Date, separate certificates evidencing the Rights (the “Rights Certificates”) will be mailed to holders of record of common stock as of the close of business on the Distribution Date and such separate Rights Certificates alone will evidence the Rights. “Acquiring Person” shall not include (i) any person who became an “Acquiring Person” as a result of the events described in (i) through (v) of Section 1 of the Rights Agreement, (ii) any Excluded Persons or Grandfathered Persons, each as defined under the Rights Agreement and (iii) any Exempt Persons (as defined below). The Rights are not exercisable until the Distribution Date. The Rights will expire at the earliest of (i) the close of business on May 28, 2025 or such later date as may be established by the Board of the Company prior to the expiration of the Rights, (ii) the time at which the Rights are redeemed or exchanged by the Company, and (iii) upon the occurrence of certain transactions. This description of the Rights Agreement herein does not purport to be complete and is qualified in its entirety by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed with the SEC on May 28, 2024. Summary of Stock-Based Compensation The stock-based compensation cost related to all awards granted to employees is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the employee’s requisite service period utilizing the weighted-average forfeiture rates as disclosed in Note 1. Total stock-based compensation expense recognized on restricted stock, restricted stock units, stock options, and employee stock purchase plan issuances during the three and six months ended June 30, 2024 and 2023 was recorded in the Company’s consolidated statements of operations as follows: Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, Cost of revenue 56,874 $ 18,085 108,445 $ 35,255 Sales and marketing 64,719 29,743 121,207 47,591 General and administrative 273,338 160,047 519,468 320,553 Total stock-based compensation $ 394,931 $ 207,875 $ 749,120 $ 403,399 |
Loss per Common Share
Loss per Common Share | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share [Abstract] | |
Loss per Common Share | LOSS PER COMMON SHARE Basic earnings (loss) per common share is computed by dividing the net income or loss by the basic weighted-average number of shares of common stock outstanding during each period presented. Although restricted stock is issued upon the grant of an award, the Company excludes restricted stock from the computations of the weighted-average number of shares of common stock outstanding until the stock vests. Diluted loss per share is computed by dividing the net income or loss by the sum of the total of the basic weighted-average number of shares of common stock outstanding plus the additional dilutive securities that could be exercised or converted into common shares during each period presented less the amount of shares that could be repurchased using the proceeds from the exercises. Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, Net loss $ (2,194,828) $ (1,033,426) $ (5,460,678) $ (3,839,765) Weighted average shares outstanding - basic and diluted 16,437,460 15,520,700 16,470,467 15,551,785 Basic and diluted loss per common share $ (0.13) $ (0.07) $ (0.33) $ (0.25) The Company excluded the following weighted average items from the above computation of diluted loss per common share, as their effect would be anti-dilutive: Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, Stock options 342,779 400,188 342,779 416,195 Restricted stock units 1,446,169 426,467 1,401,721 397,303 Restricted stock — — — 24 Total excluded shares 1,788,948 826,655 1,744,500 813,522 |
Revenue
Revenue | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | REVENUE The Company has consistently applied its accounting policies with respect to revenue to all periods presented in the consolidated financial statements contained herein. The following table illustrates the Company’s revenue by product service type: Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, Managed Services Revenue $ 8,850,463 $ 10,618,381 $ 15,547,005 $ 19,121,135 SaaS Services Revenue 243,353 70,678 499,694 305,646 Total Revenue $ 9,093,816 $ 10,689,059 $ 16,046,699 $ 19,426,781 Managed Services revenue is comprised of two types of revenue, Sponsored Social and Content. Sponsored Social revenue, which totaled $7.2 million and $13.1 million for the three and six months ended June 30, 2024, respectively, is recognized over time. Content revenue, which totaled $1.7 million and $2.4 million during the three and six months ended June 30, 2024, respectively, is recognized at a point in time. The following table provides the Company’s revenues as determined by customer geographic region: Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, Revenue from North America $ 7,537,029 $ 10,035,693 $ 13,027,444 $ 18,171,826 Revenue from APAC 445,224 653,366 2,139,422 — Revenue from Other 1,111,563 — 879,833 1,254,955 Total $ 9,093,816 $ 10,689,059 $ 16,046,699 $ 19,426,781 Contract Balances The following table provides information about receivables, contract assets, and contract liabilities from contracts with customers reported in the Company’s consolidated balance sheet: June 30, 2024 December 31, 2023 Accounts receivable, net $ 5,617,269 $ 5,012,373 Contract liabilities (unearned revenue) 7,176,694 8,891,205 The Company does not typically engage in contracts that are longer than one year. Therefore, the Company will recognize substantially all of the contract liabilities recorded at the end of the year in the following year. The contract liability balance as of December 31, 2023 was $8.9 million. Of that balance, $7.6 million was carried to revenue during the first two quarters of 2024. The contract liability balance as of June 30, 2024 was $7.2 million. The Company expects to recognize the associated revenue in 2024. The accounts receivable balance as of December 31, 2023 was $5.7 million. $0.3 million of the outstanding receivables balance from the prior year is still outstanding as of June 30, 2024. The carryforward receivables balance is fully reserved as of June 30, 2024. Contract receivables are recognized when the receipt of consideration is unconditional. Contract liabilities relate to the consideration received from customers in advance of the Company satisfying performance obligations under the terms of the contracts, which will be earned in future periods. Contract liabilities increase as a result of receiving new advance payments from customers and decrease as revenue is recognized upon the Company meeting the performance obligations. As a practical expedient, the Company expenses the costs of sales commissions that are paid to its sales force associated with obtaining contracts less than one year in length in the period incurred. Remaining Performance Obligations The Company typically enters into contracts that are one year or less in length. As such, the remaining performance obligations at June 30, 2024 and December 31, 2023, are equal to the contract liabilities disclosed above. The Company expects to recognize the full balance of the unearned revenue on June 30, 2024 within the next year. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAX The provision for income taxes for interim periods is determined using an estimated annual effective tax rate in accordance with ASC 740-270, Income Taxes, Interim Reporting. The effective tax rate may be subject to fluctuations during the year as new information is obtained, which may affect the assumptions used to estimate the annual effective tax rate, including factors such as valuation allowances against deferred tax assets, the recognition or de-recognition of tax benefits related to uncertain tax position, if any, and changes in or the interpretation of tax laws in jurisdictions where the Company conducts business. The Company’s income tax expense and effective tax rate were as follows: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Income tax benefit (expense) $ 88,296 $ — $ 107,078 $ — Effective tax rate 3.9 % — % 1.9 % — % |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2024 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS The Company has completed an evaluation of all subsequent events through August 14, 2024 to ensure that these consolidated financial statements include appropriate disclosure of events both recognized in the consolidated financial statements and events which occurred but were not recognized in the consolidated financial statements. The Company has concluded the below are subsequent events. On July 1, 2024 the Company through its subsidiary Hoozu completed the acquisition of 26 Talent, in connection with the Company’s strategic expansion efforts in Asia-Pacific (APAC) region. 26 Talent is a talent management agency. Consideration for the acquisition consisted of cash of $150,000 and contingent consideration in the form of an earn-out. As of the date of this report, an estimate of the fair value of contingent consideration associated with the acquisition was not readily determinable. On July 24, 2024 the Company completed the acquisition of Reiman Media and Capital, LLC. Reiman Media and Capital, LLC specializes in sports and entertainment. Consideration for the acquisition consisted of cash of $150,000, common stock of $25,000, and contingent consideration in the form of an earn-out. As of the date of this report, an estimate of the fair value of contingent consideration associated with the acquisition was not readily determinable. |
Company and Summary of Signif_2
Company and Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2024 | |
Accounting Policies [Abstract] | |
Nature of Business | Nature of Business IZEA Worldwide, Inc. (together with its wholly-owned subsidiaries, “IZEA” or the “Company”) is a Nevada corporation that was founded in February 2006 under the name PayPerPost, Inc. and became a public company in May 2011. In January 2015, IZEA purchased all of the outstanding shares of capital stock of Ebyline, Inc. (“Ebyline”). In March 2016, the Company formed IZEA Canada, Inc., a wholly-owned subsidiary, incorporated in Ontario, Canada, to operate as a sales and support office for IZEA’s Canadian customers. In July 2016, IZEA purchased all the outstanding shares of capital stock of ZenContent, Inc. (“ZenContent”) and in July 2018, a subsidiary of the Company merged with TapInfluence, Inc. (“TapInfluence”). The ZenContent legal entity was dissolved in December 2017, and Ebyline and TapInfluence were merged into IZEA and the legal entities were dissolved in December 2019 and December 2020, respectively. IZEA purchased all of the outstanding shares of capital stock of Hoozu Holdings, Ltd in December 2023, and completed an asset acquisition from Zuberance, Inc. in December 2023. The Company helps power the creator economy, by enabling individuals to monetize their content, creativity and influence through global brands and marketers. IZEA compensates these creators for producing unique content, such as long and short-form text, videos, photos, status updates, and illustrations for marketers or distributing such content on behalf of marketers through their websites, blogs, and social media channels. The Company also provides value through managing custom content workflow, creator search and targeting, bidding, analytics, and payment processing. While the majority of the marketers engage the Company to perform these services (the “Managed Services”) on their behalf, they may also access IZEA’s marketplaces to engage creators for influencer marketing campaigns or to produce custom content on a self-service basis by licensing the Company’s technology. Basis of Presentation The accompanying consolidated balance sheet as of June 30, 2024, the consolidated statements of operations for the three and six months ended June 30, 2024 and 2023, the consolidated statements of comprehensive loss for the three and six months ended June 30, 2024 and 2023, the consolidated statements of stockholders' equity for the three and six months ended June 30, 2024 and 2023, and the consolidated statements of cash flows for the six months ended June 30, 2024 and 2023 are unaudited but include all adjustments that are, in the opinion of management, necessary for a fair presentation of its financial position at such dates and its results of operations and cash flows for the periods then ended in conformity with generally accepted accounting principles in the United States ("GAAP"). The consolidated balance sheet as of December 31, 2023 has been derived from the audited consolidated financial statements at that date but, in accordance with the rules and regulations of the SEC, does not include all of the information and notes required by GAAP for complete financial statements. Operating results for the three and six months ended June 30, 2024 are not necessarily indicative of results that may be expected for the entire fiscal year. These unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended December 31, 2023, included in the Company's Annual Report on Form 10-K filed with the SEC on April 1, 2024. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of IZEA Worldwide, Inc. and its wholly-owned subsidiaries, subsequent to the subsidiaries’ individual acquisition, merger, or formation dates, as applicable. All significant intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates |
Cash and Cash Equivalents | Cash and Cash Equivalents |
Investment in Debt Securities | Investment in Debt Securities Our investments in debt securities are carried at either amortized cost or fair value. The cost basis is determined by the specific identification method. Investments in debt securities that the Company has the positive intent and ability to hold to maturity are carried at amortized cost and classified as held-to-maturity. Investments in debt securities that are not classified as held-to-maturity are carried at fair value and classified as either trading or available-for-sale. Realized and unrealized gains and losses on trading debt securities as well as realized gains and losses on available-for-sale debt securities are included in net income. Unrealized gains and losses, net of tax, on available-for-sale debt securities are included in our consolidated balance sheet as a component of accumulated other comprehensive income (loss). |
Accounts Receivable | Accounts Receivable and Concentration of Credit Risk The Company’s accounts receivable balance consists of trade receivables, contract assets, and a reserve for doubtful accounts. Trade receivables are customer obligations due under normal trade terms. Contract assets represent amounts owed for work that has been performed but not yet billed. The Company had net trade receivables of $5.6 million, including $5.6 million of accounts receivable and contract assets of $54,217 on June 30, 2024. The Company had net trade receivables of $5.0 million, including $4.9 million of accounts receivable and contract assets of $83,697 at December 31, 2023. Management determines the collectability of accounts by regularly evaluating individual customer receivables and considering a customer’s financial condition, credit history, and current economic conditions. An account is deemed delinquent when the customer has not paid an amount due by its associated due date. If a portion of the account balance is deemed uncollectible, the Company will either write off the amount owed or provide a reserve based on its best estimate of the uncollectible portion of the account. We assess collectability risk both generally and by specific aged invoices. Our loss history informs a general reserve percentage, which we apply to all invoices less than 90 days from the invoice due date, currently 1.1% of the outstanding balance. The general reserve, which we update periodically, recognizes that some invoices will likely become a collection risk. When an invoice ages 90 days past its due date, we consider each invoice to determine a reserve for collectability based on our prior history and recent communications with the customer, to determine a reserve amount. Generally, our reserve for such aged invoices will approach 100% of the invoice amount. The Company had a reserve for doubtful accounts of $205,000 as of June 30, 2024, and $155,000 as of June 30, 2023. Management believes that this estimate is reasonable, but there can be no assurance that the estimate will not change due to a change in economic conditions or business conditions within the industry, the individual customers, or the Company. Any adjustments to this account are reflected in the consolidated statements of operations as a general and administrative expense. The Company did not recognize any bad debt expense in the three and six months ended June 30, 2024 and recognized $50,000 in the twelve months ended December 31, 2023. |
Concentration of Credit Risk | Concentrations of credit risk with respect to accounts receivable have been typically limited because a large number of geographically diverse customers make up the Company’s customer base, thus spreading the trade credit risk. The Company controls credit risk through credit approvals, credit limits, and monitoring procedures. The Company performs credit evaluations of its customers but generally does not require collateral to support accounts receivable. The Company had one customer that accounted for more than 10% of total accounts receivable at June 30, 2024 and one customer that accounted for more than 10% of total accounts receivable at December 31, 2023. The Company had two customers each that accounted for more than 10% of its revenue during the six months ended June 30, 2024 and one customer that accounted for more than 10% of its revenue during the six months ended June 30, 2023. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost, or if acquired in a business combination, at the acquisition date fair value. Depreciation is computed using the straight-line method over the estimated useful lives of the assets as follows: Computer Equipment 3 years Office Equipment 3 - 10 years Furniture and Fixtures 5 - 10 years |
Goodwill | Goodwill Goodwill represents the excess of the consideration transferred for an acquired business over the fair value of the underlying identifiable net assets. The Company has goodwill in connection with its acquisitions of Ebyline, ZenContent, TapInfluence, and Hoozu. Goodwill is not amortized but instead, it is tested for impairment at least annually. In the event that management determines that the value of goodwill has become impaired, the Company will record a charge in an amount equal to the excess of the reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit during the fiscal quarter in which the determination is made. Goodwill is required to be tested for impairment at the reporting unit level. A reporting unit is an operating segment or one level below the operating segment level, which is referred to as a component. Management identifies its reporting units by assessing whether components (i) have discrete financial information available, (ii) engage in business activities, and (iii) whether a segment manager regularly reviews the component’s operating results. Prior to the acquisition of Hoozu on December 1, 2023, IZEA had one business operating segment with one reporting unit for purposes of goodwill impairment testing. Hoozu is being treated as a second, separate reporting unit for goodwill impairment testing. The Company performs its annual impairment tests of goodwill as of October 1 each year, or more frequently if certain indicators are present. As described in Note 5, there were no impairment charges associated with the Company’s goodwill in the three and six months ended June 30, 2024 and 2023, respectively. |
Intangible Assets | Intangible Assets The Company acquired the majority of its intangible assets through its acquisitions of Ebyline, ZenContent, TapInfluence, and Hoozu. The Company amortizes identifiable intangible assets over periods of 12 to 60 months. See Note 5 for further details. The Company accounts for its digital assets held as indefinite-lived intangible assets in accordance with ASC 350, Intangibles—Goodwill and Other. The Company maintains ownership of and control over its digital assets and may use third-party custodial services to secure them. The digital assets are initially recorded at cost and are subsequently evaluated for any changes in the fair market value. The Company did not recognize any impairment of digital assets during the three and six months ended June 30, 2024, and 2023. In December 2023, the FASB issued ASU No. 2023-08, Intangibles - Goodwill and Other - Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets (“ASU 2023-08”) . ASU 2023-08 requires fair value measurement of certain crypto assets each reporting period with the changes in fair value reflected in net income. The amendments also require disclosures of the name, fair value, units held, and cost bases for each significant crypto asset held and annual reconciliations of crypto asset holdings. The new guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2024, with early adoption permitted. The Company has opted to adopt this guidance early. A cumulative effect adjustment to retained earnings was recognized as of January 1, 2023 for $7,632. This adjustment brings the carrying value in line with the fair market value as of December 31, 2022. Adjustments have been recognized for all quarterly reporting periods for 2023 as of December 31, 2023 to restate the carrying value at the end of each period for the Company’s digital assets, as described in Note 5. The Company reviews long-lived assets, including software development costs and other intangible assets, for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. If an evaluation is required, the estimated future undiscounted cash flows associated with the asset are compared with the asset's carrying amount to determine if there has been an impairment, calculated as the difference between the asset’s fair value and the carrying value. Estimates of future undiscounted cash flows are based on expected growth rates for the business, anticipated future economic conditions, and estimates of residual values. Fair values take into consideration management estimates of risk-adjusted discount rates, which are believed to be consistent with assumptions that marketplace participants would use in their estimates of fair value. The Company did not recognize any impairment charges associated with the Company’s acquired intangible assets in the three and six months ended June 30, 2024 and 2023. |
Software Development Costs | Software Development Costs In accordance with Accounting Standards Codification (“ASC”) 350-40, Internal Use Software, the Company capitalizes certain internal-use software development costs associated with creating and enhancing internally developed software related to its platforms. Software development activities generally consist of three stages (i) the research and planning stage, (ii) the application and development stage, and (iii) the post-implementation stage. Costs incurred in the research and planning stage and in the post-implementation stage of software development, or other maintenance and development expenses that do not meet the qualification for capitalization, are expensed as incurred. Costs incurred in the application and development stage, including significant enhancements and upgrades, are capitalized. These costs include personnel and related employee benefits expenses for employees or consultants directly associated with and who devote time to software projects and external direct costs of materials obtained in developing the software. The Company also capitalizes certain costs associated with cloud computing arrangements (“CCAs”). These software developments, acquired technology, and CCA costs are amortized on a straight-line basis over the estimated useful life of five years upon the initial release of the software or additional features. The Company reviews the software development costs for impairment when circumstances indicate their carrying amounts may not be recoverable. If the carrying value of an asset group is not recoverable, the Company recognizes an impairment loss for the excess carrying value over the fair value in its consolidated statements of operations. See Note 6 for further details. |
Leases | Leases Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842) , established a right-of-use model that requires a lessee to record a right-of-use asset and a right-of-use liability on the balance sheet for all leases with terms longer than 12 months. Leases are classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The Company does not record leases on the balance sheet that have a lease term of 12 months or less at the commencement date. |
Revenue Recognition | Revenue Recognition The Company generates revenue from four primary sources: (1) revenue from its managed services when a marketer (typically a brand, agency, or partner) pays the Company to provide custom content, influencer marketing, amplification, or other campaign management services (“Managed Services”); (2) revenue from fees charged to software customers on their marketplace spend within the Company's platforms (“Marketplace Spend Fees”); (3) revenue from license and subscription fees charged to access our platforms (“License Fees”); and, (4) revenue derived from other fees such as inactivity fees, early cash-out fees, and other miscellaneous fees charged to users of the Company's platforms (“Other Fees”). The Company recognizes revenue in accordance with Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (“ASC 606”). Under ASC 606, revenue is recognized based on a five-step model as follows: (i) identify the contract with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) performance obligations are satisfied. The core principle of ASC 606 is that revenue is recognized when the transfer of promised goods or services to customers is made in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company applies the five-step model to contracts when it is probable that it will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are distinct performance obligations. The Company also determines whether it acts as an agent or a principal for each identified performance obligation. The determination of whether the Company acts as principal or agent is highly subjective and requires the Company to evaluate a number of indicators individually and as a whole in order to make its determination. For transactions in which the Company acts as a principal, revenue is reported on a gross basis as the amount paid by the marketer for the purchase of content or sponsorship, promotion, and other related services, and the Company records the amounts it pays to third-party creators as cost of revenue. For transactions in which the Company acts as an agent, revenue is reported on a net basis as the amount the Company charged to the self-service marketer using the Company’s platforms, less the amounts paid to the third-party creators providing the service. The Company maintains separate arrangements with each marketer and content creator either in the form of a master agreement or terms of service, which specify the terms of the relationship and access to its platforms or by statement of work, which specifies the price and the services to be performed, along with other terms. The transaction price is determined based on the fixed fee stated in the statement of work and does not contain variable consideration. Marketers who contract with the Company to manage their advertising campaigns or custom content requests may prepay for services or request credit terms. Payment terms are typically 30 days from the invoice date. The agreement typically provides for either a non-refundable deposit or a cancellation fee if the agreement is canceled by the customer prior to the completion of services. Billings in advance of completed services are recorded as a contract liability until earned. The Company assesses collectability based on several factors, including the creditworthiness of the customer and payment and transaction history. The Company does not typically engage in contracts that are longer than one year. Therefore, the Company does not capitalize costs to obtain its customer contracts as these amounts generally would be recognized over a period of less than one year and are not material. Managed Services Revenue For Managed Services Revenue, the Company enters into an agreement to provide services that may include multiple distinct performance obligations in the form of (i) an integrated marketing campaign to provide influencer marketing services, which may include the provision of blogs, tweets, photos, or videos shared through social network offerings and content promotion, such as click-through advertisements appearing in websites and social media channels, and (ii) custom content items, such as a research or news articles, informational material or videos. Marketers typically purchase influencer marketing services to provide public awareness or advertising buzz regarding the marketer’s brand and purchase custom content for internal and external use. The Company views its obligation to deliver influencer marketing services, including management services, as a single performance obligation that is satisfied over time as the customer receives the benefits from the services. The majority of revenue is recognized using an input method of costs incurred compared to total expected costs to measure the progress towards satisfying the overall performance obligation of the marketing campaign. The Company’s performance obligation in certain contracts with customers may be a stand-ready promise to provide influencer marketing services for an unknown or unspecified quantity of deliverables for a specified term. Under a stand-ready obligation, the Company’s performance obligation is satisfied over time throughout the contract term, and therefore, revenue is recognized straight-line over the life of the contract. The Company may provide one type or a combination of all types of these influencer marketing services on a statement of work for a lump sum fee. When multiple types of performance obligations exist in a contract, the Company allocates revenue to each distinct performance obligation at contract inception based on its relative standalone selling price. These performance obligations are to be provided over a period that generally ranges from one day to one year. The delivery of custom content represents a distinct performance obligation that is satisfied at a point in time when each piece of content is delivered to the customer. Based on the Company’s evaluations, revenue from Managed Services is reported on a gross basis because the Company has the primary obligation to fulfill the performance obligations, and it creates, reviews, and controls the services. The Company takes on the risk of payment to any third-party creators, and it establishes the contract price directly with its customers based on the services requested in the statement of work. Marketplace Spend Fees Revenue For Marketplace Spend Fees Revenue, the self-service customers instruct creators found through the Company’s platforms to provide and/or distribute custom content for an agreed-upon transaction price. The Company’s platforms control the contracting, description of services, acceptance of, and payment for the requested content. This service is used primarily by news agencies or marketers to control the outsourcing of their content and advertising needs. The Company charges the self-service customer the transaction price plus a fee based on the contract. Revenue is recognized when the transaction is completed by the creator and accepted by the marketer or verified as posted by the system. Based on the Company’s evaluations, this revenue is reported on a net basis since the Company is acting as an agent through its platform for the third-party creator to provide the services or content directly to the self-service customer or to post approved content through one or more social media platforms. License Fees Revenue License Fees Revenue is generated by granting customers limited, non-exclusive, non-transferable access to the Company’s technology platforms for an agreed-upon subscription period. Customers access the platforms to manage their influencer marketing campaigns. Fees for subscription or licensing services are recognized straight-line over the term of the service. Other Fees Revenue Other Fees Revenue is generated when fees are charged to the Company’s platform users primarily related to monthly plan fees, which are recognized within the month they relate to. |
Advertising Costs | Advertising Costs |
Income Taxes | Income Taxes Deferred income taxes are accounted for using the balance sheet approach, which requires recognition of deferred tax assets and liabilities for the expected future consequences of temporary differences between the financial reporting basis and the tax basis of assets and liabilities. A valuation allowance is provided when it is more likely than not that a deferred tax asset will not be realized. The Company incurs state franchise tax in ten states, which is included in general and administrative expense in the consolidated statements of operations and comprehensive loss. The Company identifies and evaluates uncertain tax positions, if any, and recognizes the impact of uncertain tax positions for which there is a less than more likely-than-not probability of the position being upheld when reviewed by the relevant taxing authority. Such positions are deemed to be unrecognized tax benefits, and a corresponding liability is established on the balance sheet. The Company has not recognized a liability for uncertain tax positions. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The Company’s tax years subject to examination based on the statute of limitations by the IRS is generally three years; however, the IRS may examine records and other evidence from the year the net operating loss was generated when the Company utilizes net operating loss carryforwards in future periods. The Company’s tax years subject to examination by the Canadian Revenue Agency and the Australian Taxation Office is generally four years. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company’s financial instruments are recorded at fair value. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The valuation techniques are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect certain market assumptions. There are three levels of inputs that may be used to measure fair value: • Level 1 – Valuation based on quoted market prices in active markets for identical assets and liabilities. • Level 2 – Valuation based on quoted market prices for similar assets and liabilities in active markets. • Level 3 – Valuation based on unobservable inputs that are supported by little or no market activity, therefore requiring management’s best estimate of what market participants would use as fair value. Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management. As of June 30, 2024, the Company holds Level 1 and Level 2 financial assets; this is discussed further in Note 3 - Financial Instruments of Notes to the Consolidated Financial Statements. |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation cost related to stock options granted under the 2011 Equity Incentive Plan, as amended, (the “2011 Equity Incentive Plan”), and the Inducement Plan (see Note 10) is measured at the grant date, based on the fair value of the award, and is recognized as expense over the employee’s requisite service period on a straight-line basis. The Company estimates the fair value of each option award on the date of grant using a Black-Scholes option-pricing model that uses the assumptions noted in the table below. The Company uses the simplified method to estimate the expected term of employee stock options because it does not believe historical exercise data will provide a reasonable basis for estimating the expected term for the current share options granted. The simplified method assumes that employees will exercise share options evenly between the period when the share options are vested and ending on the date when the options would expire. The Company uses the closing stock price of its common stock on the date of the grant as the associated fair value of its common stock. The Company uses the risk-free interest rate on the implied yield currently available on U.S. Treasury issues with an equivalent remaining term approximately equal to the expected life of the award. The Company has never paid any cash dividends on its common stock and does not anticipate paying any cash dividends in the foreseeable future. The Company estimates forfeitures when recognizing compensation expense and this estimate of forfeitures is adjusted over the requisite service period based on the extent to which actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures are recognized through a cumulative catch-up adjustment, which is recognized in the period of change, and a revised amount of unamortized compensation expense to be recognized in future periods. The Company may issue shares of restricted stock or restricted stock units (“RSUs”) that vest over future periods. The value of shares is recorded as the fair value of the stock or units upon the issuance date and is expensed on a straight-line basis over the vesting period. See Note 10 for additional information related to these shares. On November 30, 2023, the IZEA Board of Directors adopted the IZEA Worldwide, Inc. 2023 Inducement Plan (the “Inducement Plan”) to accommodate equity grants to new employees hired by IZEA in connection with acquisition transactions, including the Hoozu acquisition. Under the Inducement Plan, IZEA may grant, subject to certain requirements, RSUs, including performance-based and time-based RSUs, covering up to a total of 1,800,000 shares of IZEA common stock to new employees of IZEA or its subsidiaries. See Note 10 for additional information related to shares issued under both plans. Business Combinations and Asset Acquisitions The Company accounts for business combinations in accordance with Accounting Standards Codification (ASC) Topic 805, “Business Combinations.” The acquisition method of accounting is applied to all business combinations, whereby the identifiable assets acquired, liabilities assumed, and any non-controlling interests in the acquiree are recognized and measured at their fair values as of the acquisition date. Goodwill represents the excess of the purchase price over the fair value of net identifiable assets acquired and liabilities assumed in a business combination. Goodwill is allocated to reporting units, which are expected to benefit from the synergies of the combination and is subject to annual impairment testing. Acquisition-related costs, including advisory, legal, and due diligence fees, are expensed as incurred and are included in general and administrative expenses in the period in which the acquisition occurs. The financial statements include the results of operations and financial position of businesses acquired from their respective acquisition dates. Any adjustments to the preliminary fair values of assets acquired and liabilities assumed, known as measurement period adjustments, are recorded to the period of the adjustment. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements Recently Adopted Accounting Pronouncements Credit Losses : In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 replaces the incurred loss impairment methodology under current GAAP with a methodology that reflects expected credit losses and requires a consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 requires the use of a forward-looking expected credit loss model for accounts receivables, loans, and other financial instruments. In May 2019, the FASB issued ASU 2019-05, which provides transition relief for entities adopting ASU 2016-13. For entities that have adopted ASU 2016-13, the amendments in ASU 2019-05 are effective for fiscal years beginning after December 15, 2019, including interim periods therein. An entity may early adopt ASU No. 2019-05 in any interim period after its issuance if the entity has adopted ASU 2016-13. For all other entities, the effective date will be the same as the effective date of ASU 2016-13. ASU 2016-13 is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Effective January 1, 2023, the Company adopted this standard. At present, the exposure to credit losses is considered immaterial to the Company’s financial position. Accounting for Contract Assets and Contract Liabilities from Contracts with Customers: In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”). Under ASU 2021-08, an acquirer in a business combination must apply ASC 606 principles when recognizing and measuring acquired contract assets and contract liabilities. The provisions of ASU 2021-08 are applicable for the Company for fiscal years and interim periods beginning after December 15, 2022. As of June 30, 2024, the Company has ensured that acquired businesses contract assets and contract liabilities have been accounted for in accordance with ASC 2021-08. Accounting for and Disclosure of Crypto Assets : In December 2023, the FASB issued ASU No. 2023-08, Intangibles - Goodwill and Other - Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets (“ASU 2023-08”) . ASU 2023-08 requires fair value measurement of certain crypto assets each reporting period with the changes in fair value reflected in net income. The amendments also require disclosures of the name, fair value, units held, and cost bases for each significant crypto asset held and annual reconciliations of crypto asset holdings. The new guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2024, with early adoption permitted. The Company has opted to early adopt this guidance. A cumulative-effect adjustment to retained earnings was booked as of January 1, 2023 for $7,632. Interim periods and annual periods for 2022 and 2023 have been presented with the change reflected in fair market value. Expanded disclosures for crypto assets have been added to Note 5 - Intangible Assets. Recently Issued Accounting Pronouncements Not Yet Adopted Segment Reporting: Improvements to Reportable Segment Disclosures: In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improving Reportable Segment Disclosures . This update is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant expenses. The ASU also requires all annual disclosures currently required by Topic 280 to be included in the interim periods. The update is effective for fiscal years beginning after December 15, 2023, and interim periods within the fiscal years beginning after December 15, 2024, with early adoption permitted and requiring retrospective application to all prior periods presented in the financial statements. The Company is currently assessing the timing and impact of adopting the updated provisions. Income Taxes: Improvements to Income Tax Disclosures: In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires additional disclosures of income tax components that affect the rate reconciliation and income taxes paid, broken out by the applicable taxing jurisdictions. The Company expects to adopt this ASU for the annual period beginning on January 1, 2025, and does not expect a material impact on the consolidated financial statements. |
Company and Summary of Signif_3
Company and Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Accounting Policies [Abstract] | |
Schedule of Property, Plant and Equipment | Depreciation is computed using the straight-line method over the estimated useful lives of the assets as follows: Computer Equipment 3 years Office Equipment 3 - 10 years Furniture and Fixtures 5 - 10 years Property and equipment consist of the following: June 30, 2024 December 31, 2023 Furniture and fixtures $ 29,848 $ 29,848 Office equipment 8,506 8,506 Computer equipment 282,898 281,950 Total 321,252 320,304 Less accumulated depreciation (165,417) (114,927) Property and equipment, net $ 155,835 $ 205,377 |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The Company accounted for the acquisition in accordance with ASC 805, which requires the assets acquired and liabilities assumed to be recognized on the balance sheet at their fair values as of the acquisition date. Gross Purchase Consideration Initial Present and Fair Value Estimated Remaining Present and Fair Value 12/1/2023 12/1/2023 06/30/2024 Cash paid at closing $ 595,411 $ 595,411 — Stock issued at closing 1,746,535 1,746,535 — First deferred purchase price installment (1) 114,400 — — Second deferred purchase price installment (1) 60,600 — — Total estimated consideration $ 2,516,946 $ 2,341,946 $ — (1) |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The net purchase price was $18,400 in cash consideration, allocated to the fair value of assets acquired and liabilities assumed, as shown in the following table: Estimated Fair Value 12/31/2023 Intangibles-customer relationships $ 162,725 Current liabilities (58,138) Deferred revenue (86,187) Total purchase price $ 18,400 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable Securities | The following table shows the Company’s cash, cash equivalents, and marketable securities by significant investment category as of June 30, 2024: Adjusted Cost Unrealized Gains Unrealized Losses Fair Value Cash and Cash Equivalents Current Marketable Securities (1) Non-Current Marketable Securities (2) Cash and cash equivalents $ 10,223,685 $ — $ — $ 10,223,685 $ 10,223,685 $ — $ — Level 1 (3) Commercial paper 5,199,435 — (2,309) 5,197,126 5,197,126 — — Money market funds 28,881,055 — — 28,881,055 28,881,055 — — US Treasury securities 2,014,955 — (21,572) 1,993,383 — 1,993,383 — Subtotal 36,095,445 — (23,881) 36,071,564 34,078,181 1,993,383 — Level 2 (4) Asset back securities 2,375,823 — (19,309) 2,356,514 — 1,459,487 897,027 Corporate debt securities 7,890,176 5,275 (61,868) 7,833,583 — 7,833,583 — Subtotal 10,265,999 5,275 (81,177) 10,190,097 — 9,293,070 897,027 Total $ 56,585,129 $ 5,275 $ (105,058) $ 56,485,346 $ 44,301,866 $ 11,286,453 $ 897,027 (1) Current Marketable Securities have a holding period under one year. (2) Non-Current Marketable Securities have a holding period over one year. The securities held by IZEA Worldwide, Inc. mature between one (3) Level 1 fair value estimates are based on quoted prices in active markets for identical assets and liabilities. (4) Level 2 fair value estimates are based on observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets and 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 assets and liabilities. |
Fair Value of Investments in Marketable Debt Securities | The following table summarizes the estimated fair value of investments in marketable debt securities by stated contractual maturity dates: As of June 30, 2024 As of December 31, 2023 Due in 1 year or less $ 11,286,453 $ 17,126,057 Due in 1 year through 5 years 897,027 9,618,996 Total $ 12,183,480 $ 26,745,053 |
Schedule of Accumulated Other Comprehensive Income (Loss) | The following table presents fair values and net unrealized gains (losses) recorded to OCI, aggregated by investment category: June 30, 2024 December 31, 2023 Fair Value Net Unrealized Gain (Loss) Fair Value Net Unrealized Gain (Loss) Cash and cash equivalents $ 44,301,866 $ (2,309) $ 37,446,728 $ — Government bonds 1,993,383 (21,572) 6,939,713 (79,840) Corporate debt securities 7,833,583 (56,593) 16,196,931 (124,431) Asset backed securities 2,356,514 (19,309) 3,608,409 (46,320) Total $ 56,485,346 $ (99,783) $ 64,191,781 $ (250,591) |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Depreciation is computed using the straight-line method over the estimated useful lives of the assets as follows: Computer Equipment 3 years Office Equipment 3 - 10 years Furniture and Fixtures 5 - 10 years Property and equipment consist of the following: June 30, 2024 December 31, 2023 Furniture and fixtures $ 29,848 $ 29,848 Office equipment 8,506 8,506 Computer equipment 282,898 281,950 Total 321,252 320,304 Less accumulated depreciation (165,417) (114,927) Property and equipment, net $ 155,835 $ 205,377 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets | June 30, 2024 December 31, 2023 Balance Accumulated Amortization Net Book Value Balance Accumulated Amortization Net Book Value Useful Life in years Trade names $ 668,213 $ 48,581 $ 619,632 $ 668,000 $ 5,567 $ 662,433 10 Customer lists Hoozu 935,294 69,010 866,284 935,000 7,791 927,209 10 Zuberance 162,508 23,473 139,035 162,508 2,709 159,799 5 Total definite-lived intangible assets $ 1,766,015 $ 141,064 $ 1,624,951 $ 1,765,508 $ 16,067 $ 1,749,441 Software development costs consist of the following: June 30, 2024 December 31, 2023 Software development costs $ 5,827,554 $ 5,390,403 Less accumulated amortization (3,586,117) (3,333,431) Software development costs, net $ 2,241,437 $ 2,056,972 |
Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination | Total intangible assets from the Company’s acquisitions and other acquired assets net of accumulated amortization thereon consists of the following: June 30, 2024 December 31, 2023 Hoozu intangible assets $ 1,603,507 $ 1,603,000 Zuberance intangible assets 162,508 162,508 Total $ 1,766,015 $ 1,765,508 Less accumulated amortization (141,064) (16,067) Intangible assets, net $ 1,624,951 $ 1,749,441 |
Schedule of Future Amortization Expense | As of June 30, 2024, future estimated amortization expense related to identifiable assets is set forth in the following schedule: Future Amortization of Intangible Assets Amount Remainder of 2024 155,325 2025 257,032 2026 232,877 2027 208,721 2028 184,566 2029+ 586,430 Total $ 1,624,951 As of June 30, 2024, future estimated amortization expense related to software development costs is set forth in the following schedule: Software Development Amortization Expense 2024 249,961 2025 566,654 2026 560,906 2027 526,871 2028 257,843 2029 79,202 Total $ 2,241,437 |
Schedule of Goodwill | The Company’s goodwill balance changed as follows: Amount Balance on December 31, 2022 $ 4,016,722 Acquisitions during 2023 1,265,155 Currency translation adjustment $ (1,505) Balance on December 31, 2023 $ 5,280,372 Currency translation adjustment 1,516 Balance on June 30, 2024 $ 5,281,888 |
Software Development Costs (Tab
Software Development Costs (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Finite-Lived Intangible Assets [Line Items] | |
Schedule of Finite-Lived Intangible Assets | June 30, 2024 December 31, 2023 Balance Accumulated Amortization Net Book Value Balance Accumulated Amortization Net Book Value Useful Life in years Trade names $ 668,213 $ 48,581 $ 619,632 $ 668,000 $ 5,567 $ 662,433 10 Customer lists Hoozu 935,294 69,010 866,284 935,000 7,791 927,209 10 Zuberance 162,508 23,473 139,035 162,508 2,709 159,799 5 Total definite-lived intangible assets $ 1,766,015 $ 141,064 $ 1,624,951 $ 1,765,508 $ 16,067 $ 1,749,441 Software development costs consist of the following: June 30, 2024 December 31, 2023 Software development costs $ 5,827,554 $ 5,390,403 Less accumulated amortization (3,586,117) (3,333,431) Software development costs, net $ 2,241,437 $ 2,056,972 |
Schedule of Future Amortization Expense | As of June 30, 2024, future estimated amortization expense related to identifiable assets is set forth in the following schedule: Future Amortization of Intangible Assets Amount Remainder of 2024 155,325 2025 257,032 2026 232,877 2027 208,721 2028 184,566 2029+ 586,430 Total $ 1,624,951 As of June 30, 2024, future estimated amortization expense related to software development costs is set forth in the following schedule: Software Development Amortization Expense 2024 249,961 2025 566,654 2026 560,906 2027 526,871 2028 257,843 2029 79,202 Total $ 2,241,437 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses | Accrued expenses consist of the following: June 30, 2024 December 31, 2023 Accrued payroll liabilities $ 2,469,962 $ 2,153,617 Accrued taxes 90,773 253,677 Current portion of finance obligation 59,386 59,386 Accrued other 541,708 616,780 Total accrued expenses $ 3,161,829 $ 3,083,460 |
Notes Payable (Tables)
Notes Payable (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
Schedule of Maturities of Long-term Debt | As of June 30, 2024, the future contractual maturities of the Company’s long-term payment obligations by year are set forth in the following schedule: 2024 $ 29,693 2025 56,683 2026 6,737 Total $ 93,113 |
Commitment and Contingencies (T
Commitment and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Defined Contribution Plan Disclosures | Total expense for employer matching contributions during the three and six months ended June 30, 2024 and 2023 was recorded in the Company’s consolidated statements of operations as follows: Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, Cost of revenue $ 19,722 $ 19,643 $ 42,200 $ 44,276 Sales and marketing 17,191 17,799 60,230 33,416 General and administrative 48,018 41,875 92,602 77,827 Total contribution expense $ 84,931 $ 79,317 $ 195,032 $ 155,519 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Nonvested Restricted Stock Shares Activity | The following table contains summarized information about restricted stock issued during the year ended December 31, 2023 and the six months ended June 30, 2024: Restricted Stock Common Shares Weighted Average Weighted Average Nonvested at December 31, 2022 72 $ 5.36 0.3 Granted 131,520 2.28 Vested (131,592) 2.28 Nonvested at December 31, 2023 — $ — 0.0 Granted 64,385 2.33 Vested (64,385) 2.33 Nonvested at June 30, 2024 — $ — 0.0 |
Schedule of Nonvested Restricted Stock Units Activity | The following table contains summarized information about restricted stock units during the year ended December 31, 2023 and the six months ended June 30, 2024: Restricted Stock Units Common Shares Weighted Average Weighted Average Nonvested at December 31, 2022 329,070 $ 3.79 2.5 Granted 870,191 2.38 Vested (163,085) 3.55 Forfeited (73,327) 3.18 Nonvested at December 31, 2023 962,849 $ 2.60 2.5 Granted 696,945 2.25 Vested (151,587) 3.03 Forfeited (88,870) 2.28 Nonvested at June 30, 2024 1,419,337 $ 2.40 1.2 |
Share-based Payment Arrangement, Option, Activity | A summary of option activity under the 2011 Equity Incentive Plan during the year ended December 31, 2023, and the six months ended June 30, 2024, is presented below: Options Outstanding Common Shares Weighted Average Weighted Average Outstanding at December 31, 2022 415,562 $ 11.31 5.3 Granted — — Exercised (586) 0.96 Expired (71,013) 19.99 Forfeited (362) 7.75 Outstanding at December 31, 2023 343,601 $ 9.53 5.2 Granted — — Exercised (313) 2.24 Expired (458) 6.88 Forfeited (51) 6.57 Outstanding at June 30, 2024 342,779 $ 9.54 4.7 Exercisable at June 30, 2024 330,658 $ 9.55 4.7 |
Schedule of Nonvested Share Activity | A summary of the nonvested stock option activity under the 2011 Equity Incentive Plan during the year ended December 31, 2023, and the six months ended June 30, 2024, is presented below: Nonvested Options Common Shares Weighted Average Weighted Average Nonvested at December 31, 2022 72,474 $ 5.80 1.7 Granted — — Vested (31,474) 9.53 Forfeited (14,627) 19.99 Nonvested at December 31, 2023 26,373 $ 8.83 1.1 Granted — — Exercised — — Vested (14,201) 9.55 Forfeited (51) 6.57 Nonvested at June 30, 2024 12,121 $ 9.53 0.9 |
Disclosure of Share-Based Compensation Arrangements by Share-Based Payment Award | Total stock-based compensation expense recognized on restricted stock, restricted stock units, stock options, and employee stock purchase plan issuances during the three and six months ended June 30, 2024 and 2023 was recorded in the Company’s consolidated statements of operations as follows: Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, Cost of revenue 56,874 $ 18,085 108,445 $ 35,255 Sales and marketing 64,719 29,743 121,207 47,591 General and administrative 273,338 160,047 519,468 320,553 Total stock-based compensation $ 394,931 $ 207,875 $ 749,120 $ 403,399 |
Comprehensive Income (Loss) | The activity in accumulated other comprehensive income (loss) for the three and six months ended June 30, 2024 and 2023 was as follows (in thousands): Unrealized Gain (Loss) on Securities Held Currency Translation Adjustment Total Accumulated Other Comprehensive Income Balance at December 31, 2023 (250,591) — (250,591) Other comprehensive income (loss) 150,807 (12,302) 138,505 Balance at June 30, 2024 $ (99,784) $ (12,302) $ (112,086) |
Loss per Common Share (Tables)
Loss per Common Share (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, Net loss $ (2,194,828) $ (1,033,426) $ (5,460,678) $ (3,839,765) Weighted average shares outstanding - basic and diluted 16,437,460 15,520,700 16,470,467 15,551,785 Basic and diluted loss per common share $ (0.13) $ (0.07) $ (0.33) $ (0.25) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The Company excluded the following weighted average items from the above computation of diluted loss per common share, as their effect would be anti-dilutive: Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, Stock options 342,779 400,188 342,779 416,195 Restricted stock units 1,446,169 426,467 1,401,721 397,303 Restricted stock — — — 24 Total excluded shares 1,788,948 826,655 1,744,500 813,522 |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table illustrates the Company’s revenue by product service type: Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, Managed Services Revenue $ 8,850,463 $ 10,618,381 $ 15,547,005 $ 19,121,135 SaaS Services Revenue 243,353 70,678 499,694 305,646 Total Revenue $ 9,093,816 $ 10,689,059 $ 16,046,699 $ 19,426,781 The following table provides the Company’s revenues as determined by customer geographic region: Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, Revenue from North America $ 7,537,029 $ 10,035,693 $ 13,027,444 $ 18,171,826 Revenue from APAC 445,224 653,366 2,139,422 — Revenue from Other 1,111,563 — 879,833 1,254,955 Total $ 9,093,816 $ 10,689,059 $ 16,046,699 $ 19,426,781 |
Schedule of Contract with Customer | The following table provides information about receivables, contract assets, and contract liabilities from contracts with customers reported in the Company’s consolidated balance sheet: June 30, 2024 December 31, 2023 Accounts receivable, net $ 5,617,269 $ 5,012,373 Contract liabilities (unearned revenue) 7,176,694 8,891,205 |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Income Tax Rate Reconciliation | The Company’s income tax expense and effective tax rate were as follows: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Income tax benefit (expense) $ 88,296 $ — $ 107,078 $ — Effective tax rate 3.9 % — % 1.9 % — % |
Company and Summary of Signif_4
Company and Summary of Significant Accounting Policies - Cash and Cash Equivalents (Details) | Jun. 30, 2024 USD ($) | Jun. 30, 2024 CAD ($) | Jun. 30, 2024 AUD ($) | Dec. 31, 2023 USD ($) |
Accounting Policies [Abstract] | ||||
Cash, uninsured amount | $ 43,600,000 | $ 36,700,000 | ||
Cash, FDIC insured amount | $ 250,000 | |||
Cash, CDIC Insured Amount | $ 100,000 | |||
Cash, Australian Financial Claims Scheme Insured Amount | $ 250,000 |
Company and Summary of Signif_5
Company and Summary of Significant Accounting Policies - Accounts Receivable and Concentration of Credit Risk (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Jun. 30, 2024 USD ($) | Jun. 30, 2023 USD ($) | Dec. 31, 2023 USD ($) | |
Concentration Risk [Line Items] | ||||
Accounts receivable, before allowance for credit loss | $ 5,600,000 | $ 5,700,000 | ||
Unbilled receivables | $ 54,217 | 83,697 | ||
Accounts receivable, less than 90 days from due, percentage | 0.011 | |||
Allowance for doubtful accounts receivable | $ 205,000 | $ 155,000 | ||
Bad Debt Expense | 50,000 | |||
Accounts receivable, net | $ 5,617,269 | 5,012,373 | ||
Accounts Receivable excluding Contract Asset | $ 4,900,000 | |||
Accounts Receivable | Customer Concentration Risk | Customer One | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 10% | 10% | ||
Revenue Benchmark | Customer Concentration Risk | Customer One | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 10% | |||
Revenue Benchmark | Customer Concentration Risk | Customer Two | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 10% |
Company and Summary of Signif_6
Company and Summary of Significant Accounting Policies - Property and Equipment (Details) | Jun. 30, 2024 |
Computer equipment | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, useful life (in years) | 3 years |
Minimum | Office equipment | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, useful life (in years) | 3 years |
Minimum | Furniture and fixtures | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, useful life (in years) | 5 years |
Maximum | Office equipment | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, useful life (in years) | 10 years |
Maximum | Furniture and fixtures | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, useful life (in years) | 10 years |
Company and Summary of Signif_7
Company and Summary of Significant Accounting Policies - Goodwill (Details) | 6 Months Ended | |
Jun. 30, 2024 USD ($) reporting_unit segment | Jun. 30, 2023 USD ($) | |
Accounting Policies [Abstract] | ||
Number of operating segments | segment | 1 | |
Number of reporting units | reporting_unit | 1 | |
Goodwill impairment | $ | $ 0 | $ 0 |
Company and Summary of Signif_8
Company and Summary of Significant Accounting Policies - Intangible Assets (Details) - USD ($) | Jun. 30, 2024 | Dec. 31, 2023 | Jan. 01, 2023 |
Finite-Lived Intangible Assets [Line Items] | |||
Accumulated deficit | $ (90,905,472) | $ (85,444,794) | $ 7,632 |
Minimum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful Life in years | 12 months | ||
Maximum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful Life in years | 60 months |
Company and Summary of Signif_9
Company and Summary of Significant Accounting Policies - Software Development Costs (Details) | 6 Months Ended |
Jun. 30, 2024 | |
Accounting Policies [Abstract] | |
Amortization period of software development costs (in years) | 5 years |
Company and Summary of Signi_10
Company and Summary of Significant Accounting Policies - Revenue Recognition (Details) | 6 Months Ended |
Jun. 30, 2024 | |
Accounting Policies [Abstract] | |
Invoice payment terms | 30 days |
Contract assets and contract liabilities length of agreement with customers | 1 year |
Company and Summary of Signi_11
Company and Summary of Significant Accounting Policies - Advertising Costs (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Sales and marketing | ||||
Significant Accounting Policies [Line Items] | ||||
Advertising costs | $ 0.9 | $ 0.8 | $ 1.5 | $ 1.3 |
Company and Summary of Signi_12
Company and Summary of Significant Accounting Policies - Stock-Based Compensation (Details) | Nov. 30, 2023 shares |
Restricted stock units | Hoozu | |
Significant Accounting Policies [Line Items] | |
Share-based compensation arrangement by share-based payment award, number of shares authorized (in shares) | 1,800,000 |
Company and Summary of Signi_13
Company and Summary of Significant Accounting Policies - Recently Issued Accounting Pronouncements (Details) - USD ($) | Jun. 30, 2024 | Mar. 31, 2024 | Dec. 31, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Stockholders' Equity Attributable to Parent | $ 60,773,833 | $ 62,501,847 | $ 65,313,388 | $ 66,362,657 | $ 67,833,071 | $ 70,265,947 |
Accumulated Deficit | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Stockholders' Equity Attributable to Parent | $ (90,905,472) | $ (88,710,644) | $ (85,444,794) | $ (81,935,199) | $ (80,901,773) | (78,103,066) |
Accounting Standards Update 2023-08 | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Stockholders' Equity Attributable to Parent | 7,632 | |||||
Accounting Standards Update 2023-08 | Accumulated Deficit | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Stockholders' Equity Attributable to Parent | $ 7,632 |
Business Acquisitions - Additio
Business Acquisitions - Additional Information (Details) - USD ($) | 6 Months Ended | |||
Dec. 01, 2023 | Jun. 30, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | |
Business Acquisition [Line Items] | ||||
Goodwill | $ 5,281,888 | $ 5,280,372 | $ 4,016,722 | |
Total purchase considerations | 18,400 | |||
Recognized Gain on Contingent Liability at Measurement Date | $ 175,000 | |||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The net purchase price was $18,400 in cash consideration, allocated to the fair value of assets acquired and liabilities assumed, as shown in the following table: Estimated Fair Value 12/31/2023 Intangibles-customer relationships $ 162,725 Current liabilities (58,138) Deferred revenue (86,187) Total purchase price $ 18,400 | |||
Business Acquisitions | BUSINESS ACQUISITIONS Hoozu Holdings, LTD. On December 1, 2023, the Company completed the announced acquisition of Hoozu Holdings, LTD (now Hoozu Holdings Pty Ltd.)(“Hoozu”) from Hoozu investors. Hoozu is a leading Australian influencer marketing company headquartered in Sydney. The company serves a roster of the region’s most innovative brands, including Bunnings, Emma Sleep, Super Cheap Auto, and Ryobi. In addition to its core services, Hoozu’s talent management division, called Huume, represents creators in the Australian market. The net purchase price was approximately $2.5 million, including cash consideration of $0.6 million and 726,210 shares of common stock, valued at approximately $1.7 million at the acquisition date, based on the closing market share price on the acquisition date. Approximately $150,000 of transaction-related costs are separately recorded in general and administrative costs in the accompanying consolidated statement of operations for the year ended December 31, 2023. The Company accounted for the acquisition in accordance with ASC 805, which requires the assets acquired and liabilities assumed to be recognized on the balance sheet at their fair values as of the acquisition date. Gross Purchase Consideration Initial Present and Fair Value Estimated Remaining Present and Fair Value 12/1/2023 12/1/2023 06/30/2024 Cash paid at closing $ 595,411 $ 595,411 — Stock issued at closing 1,746,535 1,746,535 — First deferred purchase price installment (1) 114,400 — — Second deferred purchase price installment (1) 60,600 — — Total estimated consideration $ 2,516,946 $ 2,341,946 $ — (1) The Company’s acquisition of Hoozu on December 1, 2023, included four equal contingent cash consideration payments totaling $396,940, with twelve-month measurement periods ending December 31, 2024 and 2025. The contingent payments are based on meeting minimum Revenue and Adjusted Earnings before Taxes and Depreciation thresholds for each measurement period. The contingent payments are hit-or-miss, with the first measurement period payments carrying a make-up provision during the second measurement period. The Company determined the fair value of these contingent payments, using Monte Carlo simulation methods, to be $175,000 at the acquisition date, subject to periodic adjustment until both measurement periods are completed. During the quarter that ended June 30, 2024, the Company determined that based upon the lag behind Hoozu’s revenue and profitability growth, achieving the deferred purchase price targets for both 2024 and 2025 is not probable and accordingly reduced these installment balances to their expected payout value. The table below presents the provisional fair values on December 1, 2023, allocated to the assets acquired and liabilities assumed. The purchase accounting and purchase price allocation for Hoozu are complete. The fair values are presented in the following table: Estimated Approximate Fair Value 12/1/2023 Accounts receivable $ 419,336 Prepaid expenses 15,750 Property and equipment, net 9,033 Intangible assets Tradename 668,000 Customer list 935,000 Goodwill 1,265,155 Deferred tax liability (400,750) Accounts payable (718,515) Current liabilities (930,655) Purchase consideration, excluding cash received $ 1,262,354 Plus: cash received 1,254,592 Total purchase considerations $ 2,516,946 Accounts receivable shown in the table above represent their gross amount, which approximates the fair value, and are expected to be collected in full. The significant fair value estimates included in the provisional allocation of purchase price are discussed below. Other Intangible Assets Other intangible assets with definite lives include acquired customer relationships of $0.9 million and tradename of $0.7 million. The preliminary customer-related intangible assets’ fair value was determined by using the income approach, while the tradename fair value was determined utilizing the relief from the royalty method. Acquired customer relationships and tradename generally have useful lives of 10 years, unless shorter periods are warranted, and are amortized to operating costs on an accelerated basis. Goodwill The excess of consideration for Hoozu over the preliminary net fair value of assets acquired and liabilities assumed resulted in the provisional recognition of $1.3 million of goodwill, which is not deductible for tax purposes. Goodwill is primarily attributable to the assembled workforce and synergies. Contingent Liability Contingent liability purchase price installments, which total $396,940 based on meeting certain revenue and EBITDA milestones for 2024 and 2025, were recorded at their fair value of $175,000 at the acquisition date. The contingent liability value is subject to periodic adjustment until both measurement dates are completed. No adjustment was recorded in December 2023. As of June 30, 2024, the Company reassessed the fair value of the contingent performance-based consideration related to the earnout provision of the acquisition of Hoozu. Based on actual performance to date, and revised projections of Hoozu’s business performance, it was determined that the contingent milestones were no longer probable of being achieved. Consequently, the contingent liability was adjusted to the expected payout value, resulting in a gain of $175,000 recognized as a reduction to general and administrative expense in the consolidated statements of income. This adjustment reflects our updated expectation of future performance and aligns with the requirements of ASC 805. Privatization of Hoozu Holdings, Ltd On March 27, 2024, Hoozu Holdings, Ltd was privatized and restructured to become Hoozu Holdings Pty, Ltd. This change reflects a strategic shift to streamline operations and focus on long-term growth objectives. Zuberance On December 1, 2023, the Company entered into an Asset Purchase Agreement (the “Agreement”) with Zuberance, Inc., a Delaware corporation (“Zuberance”). Zuberance is a pioneering advocate marketing software platform. Zuberance provides marketers with the tools to build white-label communities of their customers and influencers while engaging these communities to serve as advocates for their brand, leading to low-cost content creation. The net purchase price was $18,400 in cash consideration, allocated to the fair value of assets acquired and liabilities assumed, as shown in the following table: Estimated Fair Value 12/31/2023 Intangibles-customer relationships $ 162,725 Current liabilities (58,138) Deferred revenue (86,187) Total purchase price $ 18,400 The customer-related intangible assets’ fair value was determined by using the income approach, has an estimated useful life of 5 years, and will be amortized to operating expenses on an accelerated basis. | |||
Trade names | ||||
Business Acquisition [Line Items] | ||||
Useful Life in years | 10 years | |||
Hoozu | ||||
Business Acquisition [Line Items] | ||||
Total estimated consideration | $ 2,516,946 | |||
Cash paid at closing | $ 595,411 | |||
Stock issued at closing (in shares) | 726,210 | |||
Stock issued at closing | $ 1,746,535 | |||
Transaction costs | 150,000 | |||
Goodwill | 1,265,155 | |||
Contingent liability purchase price installments | 396,940 | |||
Contingent consideration | $ 0 | |||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The fair values are presented in the following table: Estimated Approximate Fair Value 12/1/2023 Accounts receivable $ 419,336 Prepaid expenses 15,750 Property and equipment, net 9,033 Intangible assets Tradename 668,000 Customer list 935,000 Goodwill 1,265,155 Deferred tax liability (400,750) Accounts payable (718,515) Current liabilities (930,655) Purchase consideration, excluding cash received $ 1,262,354 Plus: cash received 1,254,592 Total purchase considerations $ 2,516,946 | |||
Hoozu | Trade names | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | $ 668,000 | |||
Useful Life in years | 10 years | |||
Hoozu | Customer lists | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | $ 935,000 | |||
Useful Life in years | 10 years | 10 years | ||
Zuberance | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | 162,725 | |||
Acquired finite-lived intangible assets, weighted average useful life (years) | 5 years | |||
Total purchase considerations | $ 18,400 | |||
Zuberance | Customer lists | ||||
Business Acquisition [Line Items] | ||||
Useful Life in years | 5 years |
Business Acquisitions - Schedul
Business Acquisitions - Schedule of Purchase Consideration (Details) - Hoozu | Dec. 01, 2023 USD ($) payment | Jun. 30, 2024 USD ($) |
Business Acquisition [Line Items] | ||
Cash paid at closing | $ 595,411 | |
Stock issued at closing | 1,746,535 | |
Contingent consideration | $ 0 | |
Total estimated consideration | 2,516,946 | |
Total estimated consideration | $ 2,341,946 | |
Number of payments | payment | 4 | |
Contingent liability purchase price installments | $ 396,940 | |
First deferred purchase price installment | ||
Business Acquisition [Line Items] | ||
Contingent consideration | 114,400 | 0 |
Second deferred purchase price installment | ||
Business Acquisition [Line Items] | ||
Contingent consideration | $ 60,600 | $ 0 |
Business Acquisitions - Sched_2
Business Acquisitions - Schedule of Assets Acquired and Liabilities Assumed (Details) - USD ($) | Dec. 01, 2023 | Jun. 30, 2024 | Dec. 31, 2023 | Dec. 31, 2022 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 5,281,888 | $ 5,280,372 | $ 4,016,722 | |
Deferred tax liability | $ (400,750) | |||
Hoozu | ||||
Business Acquisition [Line Items] | ||||
Accounts receivable | 419,336 | |||
Prepaid expenses | 15,750 | |||
Property and equipment, net | 9,033 | |||
Goodwill | 1,265,155 | |||
Accounts payable | (718,515) | |||
Current liabilities | (930,655) | |||
Purchase consideration, excluding cash received | 1,262,354 | |||
Plus: cash received | 1,254,592 | |||
Total estimated consideration | 2,516,946 | |||
Hoozu | Trade names | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | 668,000 | |||
Hoozu | Customer lists | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | $ 935,000 |
Business Acquisitions - Sched_3
Business Acquisitions - Schedule of Zuberance Acquisition (Details) | Dec. 31, 2023 USD ($) |
Business Acquisition [Line Items] | |
Total purchase considerations | $ 18,400 |
Zuberance | |
Business Acquisition [Line Items] | |
Intangible assets | 162,725 |
Current liabilities | (58,138) |
Deferred revenue | (86,187) |
Total purchase considerations | $ 18,400 |
Financial Instruments - Marketa
Financial Instruments - Marketable Securities by Significant Investment Category (Details) - USD ($) | Jun. 30, 2024 | Dec. 31, 2023 |
Marketable Securities [Line Items] | ||
Adjusted Cost | $ 56,585,129 | |
Unrealized Gains | 5,275 | |
Unrealized Losses | (105,058) | |
Fair Value | 56,485,346 | |
Cash and cash equivalents | 44,301,866 | $ 37,446,728 |
Current Marketable Securities | 11,286,453 | 17,126,057 |
Non-Current Marketable Securities | $ 897,027 | $ 9,618,996 |
Minimum | ||
Marketable Securities [Line Items] | ||
Securities, term | 1 year | |
Maximum | ||
Marketable Securities [Line Items] | ||
Securities, term | 5 years | |
Cash and cash equivalents | ||
Marketable Securities [Line Items] | ||
Adjusted Cost | $ 10,223,685 | |
Fair Value | 10,223,685 | |
Cash and cash equivalents | 10,223,685 | |
Level 1 | ||
Marketable Securities [Line Items] | ||
Adjusted Cost | 36,095,445 | |
Unrealized Gains | 0 | |
Unrealized Losses | (23,881) | |
Fair Value | 36,071,564 | |
Cash and cash equivalents | 34,078,181 | |
Current Marketable Securities | 1,993,383 | |
Non-Current Marketable Securities | 0 | |
Level 1 | Commercial paper | ||
Marketable Securities [Line Items] | ||
Adjusted Cost | 5,199,435 | |
Unrealized Gains | 0 | |
Unrealized Losses | (2,309) | |
Fair Value | 5,197,126 | |
Cash and cash equivalents | 5,197,126 | |
Level 1 | Money market funds | ||
Marketable Securities [Line Items] | ||
Adjusted Cost | 28,881,055 | |
Unrealized Gains | 0 | |
Unrealized Losses | 0 | |
Fair Value | 28,881,055 | |
Cash and cash equivalents | 28,881,055 | |
Level 1 | US Treasury securities | ||
Marketable Securities [Line Items] | ||
Adjusted Cost | 2,014,955 | |
Unrealized Gains | 0 | |
Unrealized Losses | (21,572) | |
Fair Value | 1,993,383 | |
Cash and cash equivalents | 0 | |
Current Marketable Securities | 1,993,383 | |
Non-Current Marketable Securities | 0 | |
Level 2 | ||
Marketable Securities [Line Items] | ||
Adjusted Cost | 10,265,999 | |
Unrealized Gains | 5,275 | |
Unrealized Losses | (81,177) | |
Fair Value | 10,190,097 | |
Cash and cash equivalents | 0 | |
Current Marketable Securities | 9,293,070 | |
Non-Current Marketable Securities | 897,027 | |
Level 2 | Asset back securities | ||
Marketable Securities [Line Items] | ||
Adjusted Cost | 2,375,823 | |
Unrealized Gains | 0 | |
Unrealized Losses | (19,309) | |
Fair Value | 2,356,514 | |
Cash and cash equivalents | 0 | |
Current Marketable Securities | 1,459,487 | |
Non-Current Marketable Securities | 897,027 | |
Level 2 | Corporate debt securities | ||
Marketable Securities [Line Items] | ||
Adjusted Cost | 7,890,176 | |
Unrealized Gains | 5,275 | |
Unrealized Losses | (61,868) | |
Fair Value | 7,833,583 | |
Cash and cash equivalents | 0 | |
Current Marketable Securities | 7,833,583 | |
Non-Current Marketable Securities | $ 0 |
Financial Instruments - Fair Va
Financial Instruments - Fair Value of Marketable Debt Securities (Details) - USD ($) | Jun. 30, 2024 | Dec. 31, 2023 |
Investments, Debt and Equity Securities [Abstract] | ||
Due in 1 year or less | $ 11,286,453 | $ 17,126,057 |
Due in 1 year through 5 years | 897,027 | 9,618,996 |
Total | $ 12,183,480 | $ 26,745,053 |
Financial Instruments - Fair _2
Financial Instruments - Fair Value and Net Unrealized Gains (Losses) By Investment in OCI (Details) - USD ($) | Jun. 30, 2024 | Dec. 31, 2023 |
Marketable Securities [Line Items] | ||
Fair Value | $ 56,485,346 | $ 64,191,781 |
Net Unrealized Gain (Loss) | (99,783) | (250,591) |
Cash and cash equivalents | ||
Marketable Securities [Line Items] | ||
Fair Value | 44,301,866 | 37,446,728 |
Net Unrealized Gain (Loss) | (2,309) | 0 |
US Treasury securities | ||
Marketable Securities [Line Items] | ||
Fair Value | 1,993,383 | 6,939,713 |
Net Unrealized Gain (Loss) | (21,572) | (79,840) |
Corporate debt securities | ||
Marketable Securities [Line Items] | ||
Fair Value | 7,833,583 | 16,196,931 |
Net Unrealized Gain (Loss) | (56,593) | (124,431) |
Asset back securities | ||
Marketable Securities [Line Items] | ||
Fair Value | 2,356,514 | 3,608,409 |
Net Unrealized Gain (Loss) | $ (19,309) | $ (46,320) |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | $ 321,252 | $ 321,252 | $ 320,304 | ||
Less accumulated depreciation | (165,417) | (165,417) | (114,927) | ||
Property and equipment, net | 155,835 | 155,835 | 205,377 | ||
Depreciation | 53,258 | $ 45,946 | |||
Depreciation and Amortization Expense | |||||
Property, Plant and Equipment [Line Items] | |||||
Depreciation | 26,701 | $ 27,160 | |||
Furniture and fixtures | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 29,848 | 29,848 | 29,848 | ||
Office equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | 8,506 | 8,506 | 8,506 | ||
Computer equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment, gross | $ 282,898 | $ 282,898 | $ 281,950 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) | Jun. 30, 2024 | Dec. 31, 2023 | Dec. 01, 2023 |
Finite-Lived Intangible Assets [Line Items] | |||
Balance | $ 1,766,015 | $ 1,765,508 | |
Accumulated Amortization | 141,064 | 16,067 | |
Intangible assets, net | 1,624,951 | 1,749,441 | |
Hoozu | |||
Finite-Lived Intangible Assets [Line Items] | |||
Balance | 1,603,507 | 1,603,000 | |
Zuberance | |||
Finite-Lived Intangible Assets [Line Items] | |||
Balance | 162,508 | 162,508 | |
Trade names | |||
Finite-Lived Intangible Assets [Line Items] | |||
Balance | 668,213 | 668,000 | |
Accumulated Amortization | 48,581 | 5,567 | |
Intangible assets, net | $ 619,632 | 662,433 | |
Useful Life in years | 10 years | ||
Trade names | Hoozu | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful Life in years | 10 years | ||
Customer lists | Hoozu | |||
Finite-Lived Intangible Assets [Line Items] | |||
Balance | $ 935,294 | 935,000 | |
Accumulated Amortization | 69,010 | 7,791 | |
Intangible assets, net | $ 866,284 | 927,209 | |
Useful Life in years | 10 years | 10 years | |
Customer lists | Zuberance | |||
Finite-Lived Intangible Assets [Line Items] | |||
Balance | $ 162,508 | 162,508 | |
Accumulated Amortization | 23,473 | 2,709 | |
Intangible assets, net | $ 139,035 | $ 159,799 | |
Useful Life in years | 5 years |
Intangible Assets - Schedule _2
Intangible Assets - Schedule of Intangible Assets Acquired (Details) - USD ($) | Jun. 30, 2024 | Dec. 31, 2023 |
Finite-Lived Intangible Assets [Line Items] | ||
Balance | $ 1,766,015 | $ 1,765,508 |
Less accumulated amortization | (141,064) | (16,067) |
Intangible assets, net | 1,624,951 | 1,749,441 |
Hoozu | ||
Finite-Lived Intangible Assets [Line Items] | ||
Balance | 1,603,507 | 1,603,000 |
Zuberance | ||
Finite-Lived Intangible Assets [Line Items] | ||
Balance | $ 162,508 | $ 162,508 |
Intangible Assets - Schedule _3
Intangible Assets - Schedule of Future Amortization Expense (Details) - USD ($) | Jun. 30, 2024 | Dec. 31, 2023 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of 2024 | $ 155,325 | |
2025 | 257,032 | |
2026 | 232,877 | |
2027 | 208,721 | |
2028 | 184,566 | |
2029+ | 586,430 | |
Intangible assets, net | $ 1,624,951 | $ 1,749,441 |
Intangible Assets - Narrative (
Intangible Assets - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Impairment of intangible assets, other than digital | $ 0 | $ 0 | ||
Digital assets | $ 243,020 | 243,020 | ||
Goodwill impairment | 0 | 0 | ||
Intangible assets, net | 1,624,951 | 1,624,951 | $ 1,749,441 | |
Gain on Crypto Assets | 80,115 | |||
Balance | 1,766,015 | 1,766,015 | $ 1,765,508 | |
Loss on crypto asset | (26,044) | |||
Bitcoin [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Digital assets | 143,436 | 143,436 | ||
Ethereum [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Digital assets | $ 99,584 | 99,584 | ||
Depreciation and Amortization Expense | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | $ 124,996 | $ 0 |
Intangible Assets - Schedule _4
Intangible Assets - Schedule of Digital Assets (Details) | 6 Months Ended |
Jun. 30, 2024 USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Digital assets | $ 243,020 |
Gain on Crypto Assets | 80,115 |
Bitcoin [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Digital assets | 143,436 |
Ethereum [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Digital assets | $ 99,584 |
Intangible Assets - Schedule _5
Intangible Assets - Schedule of Goodwill (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2024 | Dec. 31, 2023 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 5,280,372 | $ 4,016,722 |
Acquisitions, impairments, or other changes | 1,265,155 | |
Currency translation adjustment | 1,516 | (1,505) |
Goodwill, ending balance | $ 5,281,888 | $ 5,280,372 |
Software Development Costs - Sc
Software Development Costs - Schedule of Software Development Cost (Details) - USD ($) | Jun. 30, 2024 | Dec. 31, 2023 |
Research and Development [Abstract] | ||
Software development costs | $ 5,827,554 | $ 5,390,403 |
Less accumulated amortization | (3,586,117) | (3,333,431) |
Total | $ 2,241,437 | $ 2,056,972 |
Software Development Costs - Ad
Software Development Costs - Additional Information (Details) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2024 USD ($) | Jun. 30, 2023 USD ($) platform | Dec. 31, 2023 USD ($) | |
Finite-Lived Intangible Assets [Line Items] | |||||
Number of platforms developed | platform | 2 | ||||
Capitalized computer software, additions | $ 363,474 | $ 281,009 | $ 437,152 | $ 437,877 | |
Capitalized computer software, gross | 5,827,554 | 5,827,554 | $ 5,390,403 | ||
Capitalized computer software, amortization | $ 124,381 | $ 83,272 | $ 252,686 | $ 410,748 | |
Software Development | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Useful Life in years | 5 years | 5 years |
Software Development Costs - _2
Software Development Costs - Schedule of Future Estimated Amortization Expense (Details) - USD ($) | Jun. 30, 2024 | Dec. 31, 2023 |
Research and Development [Abstract] | ||
2024 | $ 249,961 | |
2025 | 566,654 | |
2026 | 560,906 | |
2027 | 526,871 | |
2028 | 257,843 | |
2029 | 79,202 | |
Software development costs, net | $ 2,241,437 | $ 2,056,972 |
Accrued Expenses (Details)
Accrued Expenses (Details) - USD ($) | Jun. 30, 2024 | Dec. 31, 2023 |
Payables and Accruals [Abstract] | ||
Accrued payroll liabilities | $ 2,469,962 | $ 2,153,617 |
Accrued taxes | 90,773 | 253,677 |
Current portion of finance obligation | 59,386 | 59,386 |
Accrued other | 541,708 | 616,780 |
Accrued expenses | $ 3,161,829 | $ 3,083,460 |
Notes Payable - Additional Info
Notes Payable - Additional Information (Details) - USD ($) | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |||
Imputed interest rate | 7.80% | ||
Payment plan | 3 years | ||
Long-term debt | $ 93,113 | $ 122,805 | |
Long-term debt, current maturities | 59,386 | $ 59,386 | |
Interest expense | $ 4,000 | $ 3,103 |
Notes Payable - Schedule of Fut
Notes Payable - Schedule of Future Maturities (Details) - USD ($) | Jun. 30, 2024 | Dec. 31, 2023 |
Debt Disclosure [Abstract] | ||
2024 | $ 29,693 | |
2025 | 56,683 | |
2026 | 6,737 | |
Total | $ 93,113 | $ 122,805 |
Commitments and Contingencies -
Commitments and Contingencies - Deferred Purchase Price (Details) - Hoozu | Dec. 01, 2023 installment | Jun. 30, 2024 USD ($) |
Other Commitments [Line Items] | ||
Number of contingent installment payments | installment | 4 | |
Contingent consideration | $ | $ 0 |
Commitments and Contingencies_2
Commitments and Contingencies - Retirement Plans (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Other Commitments [Line Items] | ||||
Company contribution percentage | 50% | |||
Percent of employees' gross pay | 8% | |||
Employers annual vesting percentage | 20% | |||
Employers matching contribution, service period (in years) | 2 years | |||
Total contribution expense | $ 84,931 | $ 79,317 | $ 195,032 | $ 155,519 |
Cost of revenue | ||||
Other Commitments [Line Items] | ||||
Total contribution expense | 19,722 | 19,643 | 42,200 | 44,276 |
Sales and marketing | ||||
Other Commitments [Line Items] | ||||
Total contribution expense | 17,191 | 17,799 | 60,230 | 33,416 |
General and administrative | ||||
Other Commitments [Line Items] | ||||
Total contribution expense | $ 48,018 | $ 41,875 | $ 92,602 | $ 77,827 |
Stockholders' Equity - Authoriz
Stockholders' Equity - Authorized Shares (Detail) - $ / shares | Jun. 30, 2024 | May 28, 2024 | Dec. 31, 2023 |
Share-Based Payment Arrangement [Abstract] | |||
Common stock, shares authorized (shares) | 50,000,000 | 50,000,000 | |
Preferred stock, shares authorized (shares) | 10,000,000 | 10,000,000 | |
Preferred stock, par value (per share) | $ 0.0001 | $ 0.001 | $ 0.0001 |
Preferred stock, shares issued | 0 | 0 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Preferred stock, shares issued | 0 | 0 | |
Series A Junior Participating Preferred Stock | |||
Share-Based Payment Arrangement [Abstract] | |||
Preferred stock, shares issued | 500,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Preferred stock, shares issued | 500,000 |
Stockholders' Equity - Share Re
Stockholders' Equity - Share Repurchase (Details) - USD ($) | Jun. 30, 2024 | Mar. 30, 2023 | Jun. 28, 2024 |
Share-Based Payment Arrangement [Abstract] | |||
Number of shares authorized for repurchase | 1,000,000 | 5,000,000 | |
Number of shares repurchased during the period | 365,855 | ||
Shares repurchased during the period (in dollars per share) | $ 1.23 | ||
Treasury stock | $ 1,000,000 | ||
Stock Repurchased and Retired During Period, Shares | 0 |
Stockholders' Equity - Reverse
Stockholders' Equity - Reverse Stock Split (Details) - shares | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2023 | Jun. 30, 2024 | |
Share-Based Payment Arrangement [Abstract] | |||
Reverse stock split fractional share adjustment (shares) | 23,789 | 23,789 | |
Preferred shares outstanding at reverse stock split | 0 |
Stockholders' Equity - Equity I
Stockholders' Equity - Equity Incentive Plan (Details) - shares | Oct. 17, 2023 | Jun. 30, 2024 | Oct. 18, 2023 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Increase in number of plan shares (in shares) | 1,800,000 | ||
Common stock, capital shares reserved for future issuance (shares) | 1,875,000 | 3,675,000 | |
Incentive compensation for employees and consultants | The Amended and Restated May 2011 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock, capital shares reserved for future issuance (shares) | 974,985 |
Stockholders' Equity - Restrict
Stockholders' Equity - Restricted Stock (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2024 USD ($) $ / shares shares | Jun. 30, 2023 USD ($) | Jun. 30, 2024 USD ($) director $ / shares shares | Jun. 30, 2023 USD ($) | Dec. 31, 2023 USD ($) director shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of independent directors | director | 5 | 5 | |||
Stock issued for payment of services | $ 75,000 | $ 75,009 | $ 150,006 | $ 150,009 | |
Restricted stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Equity instruments other than options, granted in period (in shares) | shares | 64,385 | 131,520 | |||
Restricted stock or unit expense | $ 75,000 | 75,009 | 150,009 | ||
Restricted stock | Equity Incentive 2011 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock, fair value | $ / shares | $ 2.35 | $ 2.35 | |||
Share-based compensation arrangement by share-based payment award, equity instruments other than options, aggregate intrinsic value, nonvested | $ 0 | $ 0 | |||
Fair value of common stock issued for future services | $ 0 | ||||
Director | Restricted stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Equity instruments other than options, granted in period (in shares) | shares | 31,915 | 64,385 | |||
Stock issued for payment of services | $ 300,015 | ||||
Restricted stock or unit expense | $ 150,006 | ||||
Value of Shares Issued last day of quarter and vest immediately | $ 75,000 | 75,000 | |||
Employees | Restricted stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Restricted stock or unit expense | $ 0 | $ 0 | $ 0 | $ 376 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Non-Vested Restricted Stock (Details) - Restricted Stock [Member] - $ / shares | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Restricted stock units, nonvested beginning of period | 0 | 72 | |
Restricted stock units, nonvested grants in period | 64,385 | 131,520 | |
Restricted stock units, nonvested vested in period | (64,385) | (131,592) | |
Restricted stock units, nonvested ending of period | 0 | 0 | 72 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Restricted stock units, nonvested weighted average grant date fair value | $ 0 | $ 5.36 | |
Restricted stock units, nonvested grants in period, weighted average grant date fair value | 2.33 | 2.28 | |
Restricted stock units , nonvested vested in period, weighted average grant date fair value | 2.33 | 2.28 | |
Restricted stock units, nonvested weighted average grant date fair value | $ 0 | $ 0 | $ 5.36 |
Restricted stock units, nonvested weighted average remaining contractual terms | 0 years | 0 years | 3 months 18 days |
Stockholders' Equity - Restri_2
Stockholders' Equity - Restricted Stock Units (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Dec. 01, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock issued for payment of services | $ 75,000 | $ 75,009 | $ 150,006 | $ 150,009 | |||
Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation arrangement by share-based payment award, award vesting period (in years) | 3 years | ||||||
Share-based compensation arrangement by share-based payment award, equity instruments other than options, aggregate intrinsic value, nonvested | $ 3,335,442 | 3,335,442 | |||||
Fair value of common stock issued for future services | $ 2,930,090 | ||||||
Restricted stock units, nonvested weighted average remaining contractual terms | 1 year 2 months 12 days | 2 years 6 months | 2 years 6 months | ||||
Equity instruments other than options, granted in period (in shares) | 696,945 | 870,191 | |||||
Stock options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Common stock, fair value | $ 2.35 | $ 2.35 | |||||
Restricted Stock [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock or unit expense | $ 75,000 | 75,009 | 150,009 | ||||
Restricted stock units, nonvested weighted average remaining contractual terms | 0 years | 0 years | 3 months 18 days | ||||
Equity instruments other than options, granted in period (in shares) | 64,385 | 131,520 | |||||
Employees | Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock or unit expense | 349,385 | 151,733 | $ 650,599 | 281,299 | |||
Employees | Restricted Stock [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock or unit expense | $ 0 | $ 0 | 0 | $ 376 | |||
Executive Officer | Restricted stock units | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation arrangement by share-based payment award, award vesting period (in years) | 12 months | ||||||
Executive Officer | Restricted stock units | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation arrangement by share-based payment award, award vesting period (in years) | 48 months | ||||||
Non Executive Employees [Member] | Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock issued for payment of services | $ 1,079,016 | ||||||
Equity instruments other than options, granted in period (in shares) | 475,713 | ||||||
Non Executive Employees [Member] | Restricted stock units | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation arrangement by share-based payment award, award vesting period (in years) | 12 months | ||||||
Non Executive Employees [Member] | Restricted stock units | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share-based compensation arrangement by share-based payment award, award vesting period (in years) | 36 months | ||||||
Executives Additional Incentive | Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock issued for payment of services | $ 516,307 | ||||||
Equity instruments other than options, granted in period (in shares) | 221,232 |
Stockholders' Equity - Restri_3
Stockholders' Equity - Restricted Stock Units Schedule (Details) - Restricted stock units - $ / shares | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Restricted stock units, nonvested beginning of period | 962,849 | 329,070 | |
Restricted stock units, nonvested grants in period | 696,945 | 870,191 | |
Restricted stock units, nonvested vested in period | (151,587) | (163,085) | |
Restricted stock units, nonvested forfeited in period | (88,870) | (73,327) | |
Restricted stock units, nonvested ending of period | 1,419,337 | 962,849 | 329,070 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Restricted stock units, nonvested weighted average grant date fair value | $ 2.60 | $ 3.79 | |
Restricted stock units, nonvested grants in period, weighted average grant date fair value | 2.25 | 2.38 | |
Restricted stock units , nonvested vested in period, weighted average grant date fair value | 3.03 | 3.55 | |
Restricted stock units, nonvested forfeited in period, weighted average grant date fair value | 2.28 | 3.18 | |
Restricted stock units, nonvested weighted average grant date fair value | $ 2.40 | $ 2.60 | $ 3.79 |
Restricted stock units, nonvested weighted average remaining contractual terms | 1 year 2 months 12 days | 2 years 6 months | 2 years 6 months |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Options (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Percentage of individual ownership of common stock (percentage) | 10% | |||||
Common shares, exercised | 313 | 0 | ||||
Intrinsic value of options exercised | $ 50 | $ 0 | ||||
Share-based compensation arrangement by share-based payment award, options, outstanding, intrinsic value | $ 74,149 | 74,149 | ||||
Share-based compensation arrangement by share-based payment award, options, exercisable, intrinsic value | 74,149 | 74,149 | ||||
Stock option plan expense | $ 44,514 | $ 54,780 | $ 96,479 | 119,124 | ||
May 2011 and August 2011 Equity Incentive Plans | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Fair market value of incentive stock options | 100% | |||||
Equity Incentive 2011 Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common shares, exercised | 313 | 586 | ||||
Common shares outstanding | 342,779 | 342,779 | 343,601 | 415,562 | ||
Weighted average exercise price | $ 9.54 | $ 9.54 | $ 9.53 | $ 11.31 | ||
Common shares expected to vest | 330,658 | 330,658 | ||||
Common shares expected to vest weighted average | $ 9.55 | $ 9.55 | ||||
Employee service share-based compensation, nonvested awards, compensation cost not yet recognized | $ 93,369 | $ 93,369 | ||||
Weighted average remaining years to vest (in years) | 10 months 24 days | 1 year 1 month 6 days | 1 year 8 months 12 days | |||
Options, granted | 0 | 0 | ||||
Weighted average grant date fair value, granted | $ 0 | $ 0 | ||||
Common shares, vested | (14,201) | (31,474) | ||||
Weighted average grant date fair value, vested | $ 9.55 | $ 9.53 | ||||
Common shares, forfeited | (51) | (14,627) | ||||
Weighted average grant date fair value, forfeited | $ 6.57 | $ 19.99 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | 12,121 | 12,121 | 26,373 | 72,474 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Option, Nonvested, Weighted Average Exercise Price | $ 9.53 | $ 9.53 | $ 8.83 | $ 5.80 | ||
Stock options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Proceeds from issuance or sale of equity | $ 701 | $ 0 | ||||
Common stock, fair value | $ 2.35 | $ 2.35 | ||||
Individual Stock Ownership in Excess of 10 Percent | May 2011 and August 2011 Equity Incentive Plans | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Fair market value of incentive stock options | 110% | |||||
Total vesting period | Stock options | May 2011 and August 2011 Equity Incentive Plans | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based compensation arrangement by share-based payment award, award vesting period (in years) | 10 years | |||||
Twelve Months After Grant Date | May 2011 and August 2011 Equity Incentive Plans | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Percentage of individual ownership of common stock (percentage) | 25% | |||||
Stock option vesting period from grant date (in years) | 1 year | |||||
Monthly in equal installments | Stock options | May 2011 and August 2011 Equity Incentive Plans | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based compensation arrangement by share-based payment award, award vesting period (in years) | 3 years |
Stockholders' Equity - Schedu_2
Stockholders' Equity - Schedule of Options Outstanding (Details) - $ / shares | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||
Options, exercised | (313) | 0 | ||
Equity Incentive 2011 Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||
Options outstanding, beginning of period | 343,601 | 415,562 | 415,562 | |
Options, granted | 0 | 0 | ||
Options, exercised | (313) | (586) | ||
Options, expired | (458) | (71,013) | ||
Options, forfeited | (51) | (362) | ||
Options outstanding, end of period | 342,779 | 343,601 | 415,562 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | ||||
Weighted average exercise price, beginning of period | $ 9.53 | $ 11.31 | $ 11.31 | |
Weighted average exercise price, granted | 0 | 0 | ||
Weighted average exercise price, exercised | 2.24 | 0.96 | ||
Weighted average exercise price, expired | 6.88 | 19.99 | ||
Weighted average exercise price, forfeited | 6.57 | 7.75 | ||
Weighted average exercise price, end of period | $ 9.54 | $ 9.53 | $ 11.31 | |
Weighted average remaining life (years), outstanding | 4 years 8 months 12 days | 5 years 2 months 12 days | 5 years 3 months 18 days | |
Common shares expected to vest | 330,658 | |||
Common shares expected to vest weighted average | $ 9.55 | |||
Weighted average remaining useful life exercisable | 4 years 8 months 12 days |
Stockholders' Equity - Schedu_3
Stockholders' Equity - Schedule of Nonvested Stock Option (Details) - Equity Incentive 2011 Plan - $ / shares | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares [Roll Forward] | |||
Common shares, nonvested beginning of period | 26,373 | 72,474 | |
Common shares, granted | 0 | 0 | |
Common shares, vested | (14,201) | (31,474) | |
Common shares, forfeited | (51) | (14,627) | |
Common shares, nonvested end of period | 12,121 | 26,373 | 72,474 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |||
Weighted average grant date fair value, nonvested beginning of period | $ 8.83 | $ 5.80 | |
Weighted average grant date fair value, granted | 0 | 0 | |
Weighted average grant date fair value, vested | 9.55 | 9.53 | |
Weighted average grant date fair value, forfeited | 6.57 | 19.99 | |
Weighted average grant date fair value, nonvested end of period | $ 9.53 | $ 8.83 | $ 5.80 |
Weighted average remaining years to vest (in years) | 10 months 24 days | 1 year 1 month 6 days | 1 year 8 months 12 days |
Stockholders' Equity - Induceme
Stockholders' Equity - Inducement Plan (Details) - Restricted stock units | 6 Months Ended | 12 Months Ended | ||
Dec. 01, 2023 employee shares | Jun. 30, 2024 shares | Dec. 31, 2023 shares | Nov. 30, 2023 shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Equity instruments other than options, granted in period (in shares) | 696,945 | 870,191 | ||
Share-based compensation arrangement by share-based payment award, award vesting period (in years) | 3 years | |||
Hoozu | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation arrangement by share-based payment award, number of shares authorized (in shares) | 1,800,000 | |||
Number of employees awarded | employee | 5 | |||
Equity instruments other than options, granted in period (in shares) | 328,354 | |||
Zuberance | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Equity instruments other than options, granted in period (in shares) | 10,000 | |||
All Acquisitions | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Equity instruments other than options, granted in period (in shares) | 338,354 |
Stockholders' Equity - Employee
Stockholders' Equity - Employee Stock Purchase Plan (Details) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2024 USD ($) shares | Jun. 30, 2023 USD ($) shares | Jun. 30, 2024 USD ($) h shares | Jun. 30, 2023 USD ($) shares | Oct. 18, 2023 shares | Oct. 17, 2023 shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock, capital shares reserved for future issuance (shares) | 3,675,000 | 1,875,000 | ||||
Share based compensation expense | $ | $ 394,931 | $ 207,875 | $ 749,120 | $ 403,399 | ||
2014 Employee Stock Purchase Plan | Employee Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock, capital shares reserved for future issuance (shares) | 125,000 | 125,000 | ||||
Share-based compensation arrangement by share-based payment award, award vesting period (in days) | 90 days | |||||
Minimum hour requirement for employees participation in the ESSP (hours) | h | 20 | |||||
Employee stock ownership plan (ESOP), successive offering period | 6 months | |||||
Annual compensation limit percentage, employee stock purchase plan (percentage) | 10% | |||||
Annual compensation limit, employee stock purchase plan | $ | $ 21,250 | |||||
Shares issuance limit per offering period, employee stock purchase plan (in shares) | 2,000 | |||||
Fair market value of shares available for issuance (percentage) | 85% | |||||
Value of shares issued | $ | $ 5,206 | $ 7,992 | $ 5,206 | $ 7,992 | ||
Stock purchase plan issuances (shares) | 3,047 | 4,329 | 3,047 | 4,329 | ||
Share based compensation expense | $ | $ 1,031 | $ 1,361 | $ 2,041 | $ 2,599 | ||
Number of shares reserved for future issuance | 77,931 | 77,931 |
Stockholders' Equity - Sharehol
Stockholders' Equity - Shareholder Rights Plan (Details) - $ / shares | May 28, 2024 | Jun. 30, 2024 | Dec. 31, 2023 |
Share-Based Payment Arrangement [Abstract] | |||
Preferred stock, par value (per share) | $ 0.001 | $ 0.0001 | $ 0.0001 |
Preferred Stock, Dividend Rate, Per-Dollar-Amount | $ 8.25 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary Stock-Based Compensation (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share based compensation expense | $ 394,931 | $ 207,875 | $ 749,120 | $ 403,399 |
Cost of revenue | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share based compensation expense | 56,874 | 18,085 | 108,445 | 35,255 |
Sales and marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share based compensation expense | 64,719 | 29,743 | 121,207 | 47,591 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share based compensation expense | $ 273,338 | $ 160,047 | $ 519,468 | $ 320,553 |
Stockholders' Equity - Schedu_4
Stockholders' Equity - Schedule of Accumulated Other Comprehensive Income (Loss)(Details) - USD ($) | 6 Months Ended | |||||
Jun. 30, 2024 | Mar. 31, 2024 | Dec. 31, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | ||||||
Stockholders' Equity Attributable to Parent | $ 60,773,833 | $ 62,501,847 | $ 65,313,388 | $ 66,362,657 | $ 67,833,071 | $ 70,265,947 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stockholders' Equity Attributable to Parent | 60,773,833 | $ 62,501,847 | 65,313,388 | $ 66,362,657 | $ 67,833,071 | $ 70,265,947 |
Accumulated Foreign Currency Adjustment Attributable to Parent | ||||||
Share-Based Payment Arrangement [Abstract] | ||||||
Stockholders' Equity Attributable to Parent | (12,302) | 0 | ||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | (12,302) | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stockholders' Equity Attributable to Parent | (12,302) | 0 | ||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | (12,302) | |||||
Accumulated Other Comprehensive Income (Loss) | ||||||
Share-Based Payment Arrangement [Abstract] | ||||||
Stockholders' Equity Attributable to Parent | (112,086) | (250,591) | ||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 138,505 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stockholders' Equity Attributable to Parent | (112,086) | (250,591) | ||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 138,505 | |||||
AOCI, Gain (Loss), Debt Securities, Available-for-Sale, with Allowance for Credit Loss, Parent | ||||||
Share-Based Payment Arrangement [Abstract] | ||||||
Stockholders' Equity Attributable to Parent | (99,784) | (250,591) | ||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 150,807 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stockholders' Equity Attributable to Parent | (99,784) | $ (250,591) | ||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | $ 150,807 |
Loss per Common Share - Schedul
Loss per Common Share - Schedule of Dilutive Shares (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Earnings Per Share [Abstract] | ||||
Net loss | $ (2,194,828) | $ (1,033,426) | $ (5,460,678) | $ (3,839,765) |
Weighted average common shares outstanding - basic (in shares) | 16,437,460 | 15,520,700 | 16,470,467 | 15,551,785 |
Weighted average common shares outstanding - diluted (in shares) | 16,437,460 | 15,520,700 | 16,470,467 | 15,551,785 |
Basic loss per common share (in dollars per share) | $ (0.13) | $ (0.07) | $ (0.33) | $ (0.25) |
Diluted loss per common share (in dollars per share) | $ (0.13) | $ (0.07) | $ (0.33) | $ (0.25) |
Loss per Common Share - Sched_2
Loss per Common Share - Schedule of Anti-Dilutive Shares (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share (in shares) | 1,788,948 | 826,655 | 1,744,500 | 813,522 |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share (in shares) | 342,779 | 400,188 | 342,779 | 416,195 |
Restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share (in shares) | 1,446,169 | 426,467 | 1,401,721 | 397,303 |
Restricted Stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share (in shares) | 0 | 0 | 0 | 24 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 9,093,816 | $ 10,689,059 | $ 16,046,699 | $ 19,426,781 |
Revenue from North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 7,537,029 | 10,035,693 | 13,027,444 | 18,171,826 |
Revenue from APAC | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 445,224 | 653,366 | 2,139,422 | 0 |
Revenue from Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 1,111,563 | 0 | 879,833 | 1,254,955 |
Managed Services Revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 8,850,463 | 10,618,381 | 15,547,005 | 19,121,135 |
SaaS Services Revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 243,353 | $ 70,678 | $ 499,694 | $ 305,646 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2024 USD ($) | Jun. 30, 2023 USD ($) | Dec. 31, 2023 USD ($) | |
Disaggregation of Revenue [Line Items] | |||||
Revenue | $ 9,093,816 | $ 10,689,059 | $ 16,046,699 | $ 19,426,781 | |
Length of contract with customers | 1 year | ||||
Contract liabilities | 7,176,694 | $ 7,176,694 | $ 8,891,205 | ||
Contract liabilities, revenue recognized | $ 7,600,000 | ||||
Contract length for sales commissions payment | 1 | ||||
Performance obligation contract term | 1 year | ||||
Accounts receivable, before allowance for credit loss | 5,600,000 | $ 5,600,000 | $ 5,700,000 | ||
Accounts Receivable, Noncurrent, Year One, Originated, Current Fiscal Year | 300,000 | 300,000 | |||
Sponsored Social Revenue | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue | 7,200,000 | 13,100,000 | |||
Content Revenue | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue | $ 1,700,000 | $ 2,400,000 |
Revenue - Contract Balances (De
Revenue - Contract Balances (Details) - USD ($) | Jun. 30, 2024 | Dec. 31, 2023 |
Revenue from Contract with Customer [Abstract] | ||
Accounts receivable, net | $ 5,617,269 | $ 5,012,373 |
Contract liabilities (unearned revenue) | $ 7,176,694 | $ 8,891,205 |
Income Taxes - Effective Rate R
Income Taxes - Effective Rate Reconciliation (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | ||||
Income tax benefit (expense) | $ 88,296 | $ 0 | $ 107,078 | $ 0 |
Effective tax rate | 3.90% | 0% | 1.90% | 0% |
Subsequent Events (Details)
Subsequent Events (Details) - Subsequent Event [Member] - USD ($) | Jul. 24, 2024 | Jul. 01, 2024 |
26 Talent | ||
Subsequent Event [Line Items] | ||
Total estimated consideration | $ 150,000 | |
Reiman Media and Capital, LLC | ||
Subsequent Event [Line Items] | ||
Total estimated consideration | $ 150,000 | |
Stock issued at closing | $ 25,000 |