SharpSpring (SHSP) 10-K 4 Mar 19 2018 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2018	Mar. 04, 2019	Jun. 30, 2018
Document And Entity Information
Entity Registrant Name	SharpSpring, Inc.
Entity Central Index Key	1,506,439
Document Type	10-K
Document Period End Date	Dec. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity a Well-known Seasoned Issuer	No
Entity a Voluntary Filer	No
Entity's Reporting Status Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Shell Company	false
Entity Public Float			$ 62,886,433
Entity Common Stock, Shares Outstanding		8,629,231
Trading Symbol	SHSP
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2,018

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Assets
Cash and cash equivalents	$ 9,320,866	$ 5,399,747
Accounts receivable, net of allowance for doubtful accounts of $127,516 and $525,937 at December 31, 2018 and December 31, 2017, respectively	820,946	639,959
Income taxes receivable	22,913	2,132,616
Other current assets	1,184,217	899,127
Total current assets	11,348,942	9,071,449
Property and equipment, net	1,260,798	799,145
Goodwill	8,866,413	8,872,898
Intangible assets, net	1,866,000	2,326,000
Other long-term assets	665,123	612,631
Total assets	24,007,276	21,682,123
Liabilities and Shareholders' Equity
Accounts payable	1,613,477	504,901
Accrued expenses and other current liabilities	774,944	625,680
Deferred revenue	250,656	279,818
Income taxes payable	23,705	171,384
Total current liabilities	2,662,782	1,581,783
Deferred income taxes	0	168,132
Convertible notes, including accrued interest	8,342,426	0
Convertible notes embedded derivative	214,350	0
Total liabilities	11,219,558	1,749,915
Commitments and Contingencies (Note 13)
Shareholders' equity:
Preferred stock, $0.001 par value, 5,000,000 shares authorized, no shares issued or outstanding at December 31 2018 and December 31, 2017	0	0
Common stock, $0.001 par value, Authorized shares-50,000,000; issued shares-8,639,139 at December 31 2018 and 8,456,061 at December 31, 2017; outstanding shares-8,619,139 at December 31, 2018 and 8,436,061 at December 31, 2017	8,639	8,456
Additional paid in capital	30,446,838	28,362,397
Accumulated other comprehensive loss	(231,053)	(480,762)
Accumulated deficit	(17,352,706)	(7,873,883)
Treasury stock	(84,000)	(84,000)
Total shareholders' equity	12,787,718	19,932,208
Total liabilities and shareholders' equity	$ 24,007,276	$ 21,682,123

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 127,516	$ 526,127
Preferred Stock, par value per share	$ 0.001	$ 0.001
Preferred Stock, shares authorized	5,000,000	5,000,000
Preferred Stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common shares, par value per share	$ 0.001	$ 0.001
Common shares, shares authorized	50,000,000	50,000,000
Common shares, shares issued	8,639,139	8,456,061
Common shares, shares outstanding	8,619,139	8,436,061

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Loss - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Income Statement [Abstract]
Revenue	$ 18,651,525	$ 13,448,752
Cost of services	5,798,269	4,996,745
Gross profit	12,853,256	8,452,007
Operating expenses:
Sales and marketing	10,092,691	6,677,807
Research and development	4,298,031	2,883,714
General and administrative	6,358,087	5,346,136
Non-employee stock issuance expense	508,561	0
Intangible asset amortization	460,000	527,468
Total operating expenses	21,717,370	15,435,125
Operating loss	(8,864,114)	(6,983,118)
Other (expense) income, net	(545,482)	209,175
Loss on embedded derivative	(400,220)	0
Loss before income taxes	(9,809,816)	(6,773,943)
Benefit for income tax	(330,994)	(2,104,108)
Net loss	$ (9,478,822)	$ (4,669,835)
Basic net loss per share	$ (1.11)	$ (.56)
Diluted net loss per share	$ (1.11)	$ (0.56)
Shares used in computing basic net loss per share	8,512,297	8,395,319
Shares used in computing diluted net loss per share	8,512,297	8,395,319
Other comprehensive income (loss):
Foreign currency translation adjustment, net	$ 249,709	$ (35,707)
Comprehensive loss	$ (9,229,113)	$ (4,705,542)

Consolidated Statment of Change

Consolidated Statment of Changes in Shareholders' Equity - USD ($)	Common Stock [Member]	Additional Paid-In Capital [Member]	Accumulated Other Comprehensive Loss[Member]	Treasury Stock [Member]	Accumulated Deficit [Member]	Total
Balance at Dec. 31, 2016	$ 8,381	$ 27,556,398	$ (445,055)	$ (84,000)	$ (3,204,047)	$ 22,918,245
Balance, shares at Dec. 31, 2016	8,380,663			20,000
Stock based compensation - stock options		510,978				510,978
Issuance of common stock for cash	$ 15	22,105				22,120
Issuance of common stock for cash, shares	15,387
Issuance of common stock for director services	$ 60	272,916				272,976
Issuance of common stock for director services, shares	60,011
Foreign currency translation adjustment, net			(35,707)			(35,707)
Net loss					(4,669,836)	(4,669,835)
Balance at Dec. 31, 2017	$ 8,456	28,362,397	(480,762)	$ (84,000)	(7,873,883)	19,932,208
Balance, shares at Dec. 31, 2017	8,456,061			20,000
Stock based compensation - stock options		801,655				801,655
Issuance of common stock for cash	$ 113	596,274				596,387
Issuance of common stock for cash, shares	113,090
Issuance of common stock for director services	$ 24	177,998				178,022
Issuance of common stock for director services, shares	23,302
Issuance of common stock for other non-employee services	$ 36	508,525				508,561
Issuance of common stock for other non-employee services, shares	36,274
Issuance of common stock for warrant conversions	$ 10	(10)				0
Issuance of common stock for warrant conversions, shares	10,412
Foreign currency translation adjustment, net			249,709			249,709
Net loss					(9,478,822)	(9,478,822)
Balance at Dec. 31, 2018	$ 8,639	$ 30,446,838	$ (231,053)	$ (84,000)	$ (17,352,706)	$ 12,787,718
Balance, shares at Dec. 31, 2018	8,639,139			20,000

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Cash flows from operating activities:
Net loss	$ (9,478,822)	$ (4,669,835)
Adjustments to reconcile loss from operations:
Depreciation and amortization	892,233	807,574
Amortization of costs to acquire contracts	758,014	557,595
Non-cash stock compensation	964,676	768,778
Non-employee stock issuance expense	508,561	0
Deferred income taxes	(168,119)	5,618
Loss/(gain) on disposal of property and equipment	(4,700)	3,481
Non-cash interest	304,301	0
Change in fair value of embedded derivative features	400,220	0
Amortization of debt issuance costs	(6,088)	0
Unearned foreign currency gain/loss	289,339	(70,769)
Changes in assets and liabilities:
Accounts receivable	(183,350)	665,296
Other assets	(1,097,683)	(726,227)
Income taxes, net	1,966,648	(1,105,771)
Accounts payable	1,094,281	(22,860)
Accrued expenses and other current liabilities	162,984	(256,969)
Deferred revenue	(27,283)	(8,795)
Net cash used in operating activities	(3,624,788)	(4,052,884)
Cash flows from investing activities:
Purchases of property and equipment	(893,886)	(177,110)
Proceeds from the sale of property and equipment	4,700	0
Acquisitions of customer assets from resellers	0	(64,268)
Proceeds from the sale of discontinued operations	0	1,000,000
Net cash used in investing activities	(889,186)	758,622
Cash flows from financing activities:
Proceeds from issuance of convertible note	8,000,000	0
Debt issuance costs	(141,657)	0
Proceeds from exercise of stock options	596,387	22,133
Net cash provided by financing activities	8,454,730	22,133
Effect of exchange rate on cash	(19,637)	20,502
Change in cash and cash equivalents	3,921,119	(3,251,627)
Cash and cash equivalents, beginning of period	5,399,747	8,651,374
Cash and cash equivalents, end of period	9,320,866	5,399,747
Supplemental information on consolidated statements of cash flows:
Cash (received) paid for income taxes	$ (2,099,762)	$ 98,637

Organization

Organization	12 Months Ended
	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization	SharpSpring, Inc. (the “Company”) provides a cloud-based marketing automation solution. SharpSpring is designed to increase the rates at which businesses generate leads and convert leads to sales opportunities by improving the way businesses communicate with customers and prospects. Our products are marketed directly by us and through a small group of reseller partners to customers around the world.

Summary of Significant Accounti

Summary of Significant Accounting Policies	12 Months Ended
	Dec. 31, 2018
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Basis of Presentation and Consolidation The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP). Our Consolidated Financial Statements include the accounts of SharpSpring, Inc. and our subsidiaries (the “Company”). Our Consolidated Financial Statements reflect the elimination of all significant inter-company accounts and transactions. Use of Estimates The preparation of the consolidated financial statements in conformity with U.S. 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 consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Operating Segments The Company operates as one operating segment. Operating segments are defined as components of an enterprise for which separate financial information is regularly evaluated by the chief operating decision maker (“CODM”), which is the Company’s chief executive officer, in deciding how to allocate resources and assess performance. The Company’s CODM evaluates the Company’s financial information and resources and assess the performance of these resources on a consolidated basis. The Company does not present geographical information about revenues because it is impractical to do so. Cash and Cash Equivalents Cash equivalents are short-term, liquid investments with remaining maturities of three months or less when acquired. Cash and cash equivalents are deposited or managed by major financial institutions and at most times are in excess of Federal Deposit Insurance Corporation (FDIC) insurance limits. Fair Value of Financial Instruments U.S. GAAP establishes a fair value hierarchy which has three levels based on the reliability of the inputs to determine the fair value. These levels include: Level 1, defined as inputs such as unadjusted quoted prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for use when little or no market data exists, therefore requiring an entity to develop its own assumptions. The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, deposits, embedded derivatives (associated with our convertible notes) and accounts payable. The carrying amount of cash and cash equivalents, accounts receivable and accounts payable approximates fair value because of the short-term nature of these items. The fair value of the embedded derivatives associated with our convertible notes is calculated using Level 3 unobservable inputs, utilizing a probability-weighted expected value model to determine the liability. The fair value of the embedded derivatives at December 31, 2018 and December 31, 2017 was a liability balance of $214,350 and zero, respectively. The change in fair value for the year ended December 31, 2018 was a loss of $400,220. Accounts Receivable In cases where our customers pay for services in arrears, we accrue for revenue in advance of billings as long as the criteria for revenue recognition is met, thus creating a contract asset. A portion of our accounts receivable balance is therefore unbilled at each balance sheet date. Accounts receivable are carried at the original invoiced amount less an allowance for doubtful accounts based on the probability of future collection. Management reviews accounts receivable on a periodic basis to determine if any receivables will potentially be uncollectible. The Company reserves for receivables that are determined to be uncollectible, if any, in its allowance for doubtful accounts. After the Company has exhausted all collection efforts, the outstanding receivable is written off against the allowance. The following table presents the balances of accounts receivable as of December 31, 2018 and December 31, 2017: December 31, December 31, 2018 2017 Accounts receivable $ 208,037 $ 611,293 Unbilled receivables 740,425 554,603 Gross receivables $ 948,462 $ 1,165,896 Allowance for doubtful accounts (127,516 ) (525,937 ) Accounts receivable and unbilled receivables, net $ 820,946 $ 639,959 During the year ended December 31, 2018, the Company wrote off approximately $494,000 of accounts receivable against the allowance for doubtful accounts, with zero net loss recognized in the period for this amount as the accounts were fully reserved. Allowance for doubtful accounts increased by approximately $58,000 due to bad debt and changes in revenue reserves. The remaining change in allowance for doubtful accounts is due to fluctuations in foreign currency rates. No amounts were written off during the year ended December 31, 2017. Intangibles Finite-lived intangible assets include trade names, developed technologies and customer relationships and are amortized based on the estimated economic benefit over their estimated useful lives, with original periods ranging from 5 to 11 years. We continually evaluate the reasonableness of the useful lives of these assets. Finite-lived intangibles are tested for recoverability whenever events or changes in circumstances indicate the carrying amounts may not be recoverable. Impairment losses are measured as the amount by which the carrying value of an asset group exceeds its fair value and are recognized in operating results. Judgment is used when applying these impairment rules to determine the timing of the impairment test, the undiscounted cash flows used to assess impairments and the fair value of an asset group. The dynamic economic environment in which the Company operates, and the resulting assumptions used to estimate future cash flows impact the outcome of these impairment tests. Goodwill and Impairment As of December 31, 2018 and 2017, we had recorded goodwill of $8,866,413 and $8,872,898, respectively. Goodwill consists of the excess of the purchase price over the fair value of tangible and identifiable intangible net assets acquired in the SharpSpring and GraphicMail acquisitions (See Note 3). Under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 350, “Intangibles - Goodwill and Other” Debt Issuance Costs We incurred certain third-party costs in connection with the issuance of the 5% Convertible Notes maturing March 27, 2023 (the “Notes”), as more fully described in Note 4: Convertible Notes, principally related to legal and financial advisory fees. These costs are included as a direct reduction to the carrying value of the debt as part of the Notes on our consolidated balance sheets and are being amortized to interest expense ratably over the five-year term of the Notes. Estimated amortization expense of debt issuance costs for subsequent years is as follows: 2019 26,585 2020 27,885 2021 29,247 2022 30,677 2023 7,759 Total $ 122,153 Income Taxes Provision for income taxes are based on taxes payable or refundable for the current year and deferred taxes on temporary differences between the amount of taxable income and pretax financial income and between the tax bases of assets and liabilities and their reported amounts in the financial statements. Deferred tax assets and liabilities are included in the financial statements at currently enacted income tax rates applicable to the period in which the deferred tax assets and liabilities are expected to be realized or settled as prescribed in FASB ASC 740, Accounting for Income Taxes. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes. A valuation allowance is established to reduce deferred tax assets if it is more likely than not that a deferred tax asset will not be realized. The Company applies the authoritative guidance in accounting for uncertainty in income taxes recognized in the consolidated financial statements. This guidance prescribes a two-step process to determine the amount of tax benefit to be recognized. First, the tax position must be evaluated to determine the likelihood that it will be sustained upon external examination. If the tax position is deemed “more-likely-than-not” to be sustained, the tax position is then assessed to determine the amount of benefit to recognize in the financial statements. The amount of the benefit that may be recognized is the largest amount that has a greater than 50% likelihood of being realized upon ultimate settlement. There are no material uncertain tax positions taken by the Company on its tax returns. Tax years subsequent to 2014 remain open to examination by U.S. federal and state tax jurisdictions. In determining the provision for income taxes, the Company uses statutory tax rates and tax planning opportunities available to the Company in the jurisdictions in which it operates. This includes recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns to the extent pervasive evidence exists that they will be realized in future periods. The deferred tax balances are adjusted to reflect tax rates by tax jurisdiction, based on currently enacted tax laws, which are expected to be in effect in the years in which the temporary differences are expected to reverse. In accordance with the Company’s income tax policy, significant or unusual items are separately recognized in the period in which they occur. The Company is subject to routine examination by domestic and foreign tax authorities and frequently faces challenges regarding the amount of taxes due. These challenges include positions taken by the Company related to the timing, nature and amount of deductions and the allocation of income among various tax jurisdictions. As of December 31, 2018, the Company is being examined by the U.S. tax authorities related to the 2016 and 2017 tax years. The company does not expect any material adjustments as a result of the audit. Property and Equipment Property and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful life of the assets. Upon retirement or sale, the cost of assets disposed of and the related accumulated depreciation are eliminated from the accounts and any resulting gain or loss is credited or charged to operations. Repairs and maintenance costs are expensed as incurred. Depreciation expense from continuing operations related to property and equipment was $432,233 and $280,106 for the years ended December 31, 2018 and 2017, respectively. Property and equipment as of December 31 is as follows: December 31, December 31, 2018 2017 Property and equipment, gross: Leasehold improvements $ 197,268 $ 128,122 Furniture and fixtures 611,171 355,033 Computer equipment and software 1,135,012 776,201 Total 1,943,451 1,259,356 Less: Accumulated depreciation and amortization (682,653 ) (460,211 ) $ 1,260,798 $ 799,145 Useful lives are as follows: Leasehold improvements 5 years Furniture and fixtures 3-5 years Computing equipment 3 years Software 3-5 years Revenue Recognition The Company recognizes revenue from its services when it is probable that the economic benefits associated with the transactions will flow to the Company and the amount of revenue can be measured reliably. All significant sources of revenue are the result of a contract with a customer, and as such meet all of the requirements of recognizing revenue in accordance with FASB ASC 606. For the year ended December 31, 2018 and 2017, revenue from contracts with customers was $18.7 million and $13.5 million, respectively. For the Company’s internet-based SharpSpring marketing automation solution, the services are typically offered on a month-to-month basis with a fee charged each month depending on the size of the engagement with the customer. Monthly fees are recorded as revenue during the month they are earned. Some customers are charged annually in advance, for which revenues are deferred and recorded ratably over the subscription period. The Company also charges transactional-based fees if monthly volume limitations are reached or other chargeable activity occurs. Additionally, customers are typically charged an upfront onboarding and training services. The upfront implementation and training fees represent short-term “use it or lose it” services offered for a flat fee. Such flat fees are recognized over the service period, which is typically 60 days. For the SharpSpring Mail+ product, the services are typically offered on a month-to-month basis. Customers are either charged in arrears based on the number of contacts in the system during the billing period or in advance if the customer selects a plan based on e-mail volume. The Company also charges transactional-based fees if monthly volume limitations are reached or other chargeable activity occurs. Our products are billed in arrears or upfront, depending on the product, which creates contract assets (accrued revenue) and contract liabilities (deferred revenue). Contract assets occur due to unbilled charges for which the Company has satisfied performance obligations. Contract liabilities occur due to billing up front for charges that the Company has not yet fully satisfied all performance obligations. Both contract assets and liabilities are recognized and deferred ratably over their service periods. The Company makes judgements when determining revenue recognition. Because many of our contracts are billed in arrears, estimates are made for the transaction price and amounts allocated to each accounting period related to the performance obligations of each contract. There have been no changes to the methodology used in these judgements and estimates for determining revenues. Some of the estimates used when determining revenue recognition relate to variable customer consideration that changes from month to month. The Company uses the most likely amount method to determine the estimated variable consideration, relying on historical consideration received, customer status and projected usage to determine the most likely consideration amount. The amount of variable consideration recognized is constrained and is only included in the transaction price to the extent that it is probable that a significant reversal of cumulative revenue recognized will not occur. The performance obligations are measured using the output method to recognize revenue based on direct measurements of the value to the customer of the services transferred to date. Most of the Company’s contracts are satisfied over time, and as each contract has a predefined service period. This allows for a reliable way to measure performance obligations remaining and completed. The Company does have some contracts that are satisfied at a point in time upon delivery of services. The criteria for the completion of these contracts is defined in each contract with a customer so that there is no judgment required in evaluating when the service is delivered to the customer. Any discount given is allocated to the performance obligation and is treated as reduction to the transaction price. Due to the month to month nature of the Company’s contracts with customers, no financing or time value of money component exists related to the contracts with customers. Due to the month to month nature of the Company’s contracts with customers, we have elected to utilize the optional practical expedient from ASC 606-10-50-14 through 50-14A for disclosing the remaining performance obligations. The remaining performance obligations as of the balance sheet date consist of trainings and availability and use of the SharpSpring platform over the remainder of the contract, which is typically less than 30 days. From time to time, the Company offers refunds to customers and experiences credit card chargebacks relating to cardholder disputes that are commonly experienced by businesses that accept credit cards. The Company makes estimates for refunds and credit card chargebacks based on historical experience. Deferred Revenue Deferred revenue consists of payments received in advance of the Company’s providing the services. Deferred revenue is earned over the service period identified in each contract. The majority of our deferred revenue balances (contract liabilities) arise from upfront implementation and training fees for its SharpSpring marketing automation solution that are paid in advance. These services are typically performed over a 60-day period, and the revenue is recognized over that period. Additionally, some of the Company’s customers pay for services in advance on a periodic basis (such as monthly, quarterly, annually or bi-annually). In situations where a customer pays in advance for a one-year service period, the deferred revenue is recognized over that service period. Deferred revenue balances were $279,818 and $280,159 as of December 31, 2017 and 2016, respectively. Deferred revenue during the year ended December 31, 2018 and 2017 decreased by $29,162 and $340, respectively. The Company had deferred revenue contract liability balances of $250,656 and $279,818 as of December 31, 2018 and 2017, respectively. The Company expects to recognize a majority of the revenue on of these remaining performance obligations within 12 months. Approximately 20% of the deferred revenue balance is related to prepaid credits. These credits are recognized as they are used. The Company expects to recognize approximately half of the remaining credits within 12 months. Accrued Revenue In cases where our customers pay for services in arrears, we accrue for revenue in advance of billings as long as the criteria for revenue recognition is met, thus creating a contract asset. A portion of our accounts receivable balance is therefore unbilled at each balance sheet date. The accrued revenue contract asset balances were $554,603 and $439,559 as of December 31, 2017 and 2016, respectively. Revenue billed that was included in accrued revenue at the beginning of the year ended December 31, 2018 and 2017 was $554,603 and $439,559, respectively. Accrued revenue not billed in year ended December 31, 2018 and 2017 was $740,425 and $554,603, respectively. The Company had accrued revenue contract asset balances of $740,425 and $554,603 as of December 31, 2018 and 2017, respectively. Concentration of Credit Risk and Significant Customers Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash, cash equivalents. At December 31, 2018 and 2017, the Company had cash balances at financial institutions that exceed federally insured limits. The Company maintains its cash balances with accredited financial institutions. The Company does not believe it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships. For the years ended December 31, 2018, and 2017, there were no customers that accounted for more than 10% of total revenue or 10% of total accounts receivable. Cost of Services Cost of services consists primarily of direct labor costs associated with support and customer onboarding and technology hosting costs and license costs associated with the cloud-based platform. Credit Card Processing Fees Credit card processing fees are included as a component of general and administrative expenses and are expensed as incurred. Advertising Costs The Company expenses advertising costs as incurred. Advertising and marketing expenses, excluding marketing team costs, were $5.7 million and $3.2 million for the years ended December 31, 2018 and 2017, respectively. Capitalized Cost of Obtaining a Contract The Company capitalizes sales commission costs which are incremental to obtaining a contract. We expense costs that are related to obtaining a contract but are not incremental such as other sales and marketing costs and other costs that would be incurred regardless of if the contract was obtained. Capitalized costs are amortized using straight-line amortization over the estimated weighted average life of the customer, which we have estimated to be 3 years. At December 31, 2018, the net carrying value of the capitalized cost of obtaining a contract was $1,309,329, of which $699,159 is included in other current assets and $610,170 is included in other long-term assets. At December 31, 2017, the net carrying value of the capitalized cost of obtaining a contract was $1,218,833, of which $631,203 is included in other current assets and $587,630 is included in other long-term assets. The Company amortized costs directly attributable to obtaining contracts of $758,014 and $557,495 during the year ended December 31, 2018 and 2017, respectively. Such capitalized cost adjustments have been retroactively applied to prior periods. Stock Compensation We account for stock-based compensation in accordance with FASB ASC 718 “Compensation - Stock Compensation”, which requires companies to measure the cost of employee services received in exchange for an award of an equity instrument based on the grant-date fair value of the award. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period. Net Income (Loss) Per Share Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding for the period. Diluted net loss per share is computed by giving effect to all potential dilutive common stock equivalents for the period. For purposes of this calculation, options to purchase common stock, warrants and the conversion option of the convertible Notes (Note 4) are considered to be potential common shares outstanding. Since the Company incurred net losses for each of the periods presented, diluted net loss per share is the same as basic net loss per share. The Company’s potential common shares outstanding were not included in the calculation of diluted net loss per share as the effect would be anti-dilutive. Comprehensive Income or Loss Comprehensive income or loss includes all changes in equity during a period from non-owner sources, such as net income or loss and foreign currency translation adjustments. Foreign Currency The functional currency of the Company’s foreign subsidiaries is the local currency. Assets and liabilities denominated in a foreign currency are translated into U.S. dollars at the exchange rates in effect at the balance sheet dates; with the resulting translation adjustments directly recorded to a separate component of accumulated other comprehensive loss. Income and expense accounts are translated at the average exchange rates during the period. Foreign currency transaction gains and losses are recorded in other comprehensive income (loss). Recently Issued Accounting Standards Recent accounting standards not included below are not expected to have a material impact on our consolidated financial position and results of operations. In January 2017, the FASB issued guidance simplifying the accounting for goodwill impairment by removing Step 2 of the goodwill impairment test. Under current guidance, Step 2 of the goodwill impairment test requires entities to calculate the implied fair value of goodwill in the same manner as the amount of goodwill recognized in a business combination by assigning the fair value of a reporting unit to all of the assets and liabilities of the reporting unit. The carrying value in excess of the implied fair value is recognized as goodwill impairment. Under the new standard, goodwill impairment is recognized based on Step 1 of the current guidance, which calculates the carrying value in excess of the reporting unit’s fair value. The new standard is effective beginning in January 2020, with early adoption permitted. We do not believe the adoption of this guidance will have a material impact on our consolidated financial statements. In February 2016, the FASB issued guidance that requires lessees to recognize most leases on their balance sheets but record expenses on their income statements in a manner similar to current accounting. For lessors, the guidance modifies the classification criteria and the accounting for sales-type and direct financing leases. The guidance is effective in 2019 with early adoption permitted. The Company is currently evaluating the impact of this guidance on the consolidated financial statements. In May 2014, the FASB issued updated guidance and disclosure requirements for recognizing revenue from contracts with customers. This new revenue recognition standard became effective for the Company on January 1, 2018. In addition to providing guidance on when and how revenue is recognized, the new standard also provides guidance on accounting for costs of obtaining contracts primarily related to aligning the expense with the period in which the value is recognized. As a result of this new standard, the Company was required to capitalize certain costs related to obtaining contracts associated with commissions expense paid to salespeople. The Company is using the retrospective transition method to adjust each prior reporting period presented for this new method of accounting for costs associated with obtaining contracts. The application of the retrospective transition was applied to all contracts at the date of initial application. The following tables present our results under our historical method and as adjusted to reflect these accounting changes. Historical Accounting Method Effect of Adoption of New ASU As Adjusted Year Ended December 31, 2018 Sales and Marketing Expense 10,183,186 (90,495 ) 10,092,691 Total operating expense 21,807,865 (90,495 ) 21,717,370 Operating loss (8,954,609 ) 90,495 (8,864,114 ) Loss before income taxes (9,900,311 ) 90,495 (9,809,816 ) Net loss (9,569,317 ) 90,495 (9,478,822 ) Basic net loss per share (1.12 ) 0.01 (1.11 ) Diluted net loss per share (1.12 ) 0.01 (1.11 ) Balance as of December 31, 2018 Other current assets 485,058 699,159 1,184,217 Other long-term assets 54,954 610,169 665,123 Total assets 22,697,947 1,309,329 24,007,276 Accumulated deficit (18,662,035 ) 1,309,329 (17,352,706 ) Historical Accounting Method Effect of Adoption of New ASU As Adjusted Year Ended December 31, 2017 Sales and Marketing Expense 6,983,208 (305,401 ) 6,677,807 Total operating expense 15,740,526 (305,401 ) 15,435,125 Operating loss (7,288,519 ) 305,401 (6,983,118 ) Loss before income taxes (7,079,344 ) 305,401 (6,773,943 ) Net loss (4,975,236 ) 305,401 (4,669,835 ) Basic net loss per share (0.59 ) 0.04 (0.56 ) Diluted net loss per share (0.59 ) 0.04 (0.56 ) Balance as of December 31, 2017 Other current assets 267,924 631,203 899,127 Other long-term assets 25,000 587,631 612,631 Total assets 20,463,289 1,218,834 21,682,123 Accumulated deficit (9,092,717 ) 1,218,834 (7,873,883 )

Credit Facility

Credit Facility	12 Months Ended
	Dec. 31, 2018
Debt Disclosure [Abstract]
Credit Facility	In March 2016, the Company entered into a $2.5 million revolving loan agreement (the “Credit Facility”) with Western Alliance Bank. The facility originally matured on March 21, 2018 and was amended to mature on March 31, 2020. There are no mandatory amortization provisions and the Credit Facility is payable in full at maturity. Loan proceeds accrue interest at the higher of Western Alliance Bank’s Prime interest rate (5.25% as of December 31, 2018) or 5.25%, plus 2.00%. The Credit Facility is collateralized by a lien on substantially all of the existing and future assets of the Company and secured by a pledge of 100% of the capital stock of SharpSpring Technologies, Inc. and a 65% pledge of the Company’s foreign subsidiaries’ stock. The Credit Facility subjects the Company to a number of restrictive covenants, including financial and non-financial covenants customarily found in loan agreements for similar transactions. The Credit Facility also restricts our ability to pay cash dividends on our common stock. There are no amounts outstanding under the Credit Facility and no events of default have occurred.

Convertible Notes

Convertible Notes	12 Months Ended
	Dec. 31, 2018
Debt Disclosure [Abstract]
Convertible Notes	On March 28, 2018, we issued $8.0 million in aggregate principal amount of convertible notes (the “Notes”). Interest accrues at a rate of 5.0% per year and is “payable in kind” annually in the form of the issuance of additional notes (“PIK Notes”). The principal amount of the Notes and the PIK Notes are due and payable in full on the fifth anniversary of the issuance date of the Notes. The Company has the right to extend the maturity date for up to nine months on up to three separate occasions, with interest accruing at a rate of 10% during any such extension periods. The Notes are convertible into shares of the Company’s common stock at any time by the holder at a fixed conversion price of $7.50 per share, subject to customary adjustments for specified corporate events. Additionally, if the Notes and PIK Notes are not converted into common stock by the holder, at the maturity date, the Company may elect to convert all outstanding Notes and PIK Notes into shares of the Company’s common stock at a conversion price equal to 80% of the volume weighted average closing price of the Company’s common stock for the 30 trading days prior to an including the maturity date. We received net proceeds from the offering of approximately $7.9 million after adjusting for debt issue costs, including financial advisory and legal fees. The Notes are unsecured obligations and are subordinate in right of payment to the Credit Facility (Note 3). So long as any Notes are outstanding, except as the investor may otherwise agree in writing, the Company shall at no time (i) have outstanding senior indebtedness in an aggregate amount exceeding 18.6% of the Company’s trailing twelve-month revenue, (ii) incur any indebtedness that is both junior in right of payment to the obligations of the Company to its senior secured lender and senior to the Company’s obligations under the Notes or (iii) enter into any agreement with any lender or other third party that would (A) prohibit the Company from issuing PIK Notes at any time or under any circumstances or (B) prohibit the conversion of the Notes in accordance with their terms at any time or under any circumstances. Prior to the issuance of the Notes, the Company had no outstanding indebtedness for borrowed money. The holder of the Notes must notify the Company at least 120 days prior to the maturity of the Notes of its election to convert the Notes. The Notes agreement contains customary events of default with respect to the Notes and provides that upon certain events of default occurring and continuing, the investor, by written notice to the Company, may declare the entire outstanding principal amount of the Note and all accrued but unpaid interest to be immediately due and payable. During the continuance of an event of default, the investor would have recourse to any and all remedies available to under applicable law. The Notes were recorded upon issuance at amortized cost in accordance with applicable accounting guidance. As there is no difference in the amount recorded at inception and the face value of the Notes, interest expense will be accreted at the stated interest rate under the terms of the Notes. Total interest expense related to the Notes will be impacted by the amortization of the debt issuance cost using the effective interest method. The Company would be required to accelerate and issue the PIK Notes through the maturity of the Notes if the Company elects to convert the Notes prior to maturity (which it can do upon certain conditions) or if there is a change in control. Pursuant to accounting guidance, for each of these situations, the Company determined that the economic characteristics of these “make whole” features were not considered clearly and closely related to the Company’s stock. Accordingly, these features were determined to be “embedded derivatives” and were bifurcated from the Notes and separately accounted for on a combined basis at fair value as a single derivative. The fair value of the derivatives as of December 31, 2018 was a liability of $214,350 which is included within the non-current liabilities on the balance sheet. The derivative is being accounted for at fair value, with subsequent changes in the fair value to be reported as part of Other income (expense), net in the Consolidated Statement of Operations. Additionally, the investor’s conversion option was analyzed for embedded derivative treatment, but the conversion option qualifies for a scope exception as it is considered to be clearly and closely related to the Company’s stock. The net carrying amount of the Notes at December 31, 2018 was as follows: Year Ended December 31, 2018 Principal amount $ 8,000,000 Accrued interest paid-in-kind 304,301 Unamortized debt issuance costs (122,153 ) Original embedded derivative conversion feature 160,278 Net carrying value $ 8,342,426 We incurred certain third-party costs in connection with our issuance of the Notes, principally related to financial advisory and legal fees, which are being amortized to interest expense ratably over the five-year term of the Notes. The following table sets forth total interest expense related to the Notes for the period ended December 31, 2018: Year Ended December 31, 2018 Contractual interest paid-in-kind expense (non-cash) $ 304,301 Amortization of debt issuance costs (non-cash) 19,504 Amortization of embedded derivative (non-cash) (25,592 ) Total interest expense $ 298,213 Effective interest rate 4.9 %

Goodwill and Other Intangible A

Goodwill and Other Intangible Assets	12 Months Ended
	Dec. 31, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill and Other Intangible Assets	Goodwill and acquired intangible assets are initially recorded at fair value and measured periodically for impairment. In performing the Company’s annual impairment analysis during the fourth quarters of 2018 and 2017, the Company determined that the carrying amount of the Company’s goodwill was recoverable and no additional tests were required. Because portions of the goodwill are denominated in foreign currencies, relatively minor changes to the goodwill balance occur over time due to changes in foreign exchange rates. During the year ended December 31, 2018 and 2017, changes in foreign exchange rates caused goodwill to be reduced by $6,485 and increased by $27,504, respectively. In addition to our annual goodwill impairment review, the Company also performs periodic reviews of the carrying value and amortization periods of other acquired intangible assets. If indicators of impairment are present, an estimate of the undiscounted cash flows that the specific asset is expected to generate must be made to ensure that the carrying value of the asset can be recovered. These estimates involve significant subjectivity. During the years ended December 31, 2018 and 2017, the Company determined that no indicators of impairment were present for Goodwill and acquired intangible assets. The following tables set forth the information for intangible assets subject to amortization and for intangible assets not subject to amortization. As of December 31, 2018 Gross Net Carrying Accumulated Carrying Amount Amortization Value Amortized intangible assets: Trade names $ 120,000 (120,000 ) $ - Technology 2,130,000 (954,000 ) 1,176,000 Customer relationships 4,100,014 (3,410,014 ) 690,000 Unamortized intangible assets: 6,350,014 (4,484,014 ) 1,866,000 Goodwill 8,866,413 Total goodwill and intangible assets $ 10,732,413 As of December 31, 2017 Gross Net Carrying Accumulated Carrying Amount Amortization Value Amortized intangible assets: Trade names $ 346,644 $ (309,640 ) $ 37,004 Technology 3,834,023 (2,404,023 ) 1,430,000 Customer relationships 4,165,665 (3,306,669 ) 858,996 Unamortized intangible assets: 8,346,332 (6,020,332 ) 2,326,000 Goodwill 8,872,898 Total intangible assets $ 11,198,898 Estimated amortization expense for 2018 and subsequent years is as follows: 2019 381,000 2020 332,000 2021 280,000 2022 228,000 2023 180,000 Thereafter 465,000 Total $ 1,866,000 Amortization expense, excluding impairments, for the years ended December 31, 2018 and 2017, was $460,000 and $527,468, respectively.

Changes in Accumulated Other Co

Changes in Accumulated Other Comprehensive Income (Loss)	12 Months Ended
	Dec. 31, 2018
Equity [Abstract]
Changes in Accumulated Other Comprehensive Income (Loss)	Foreign Currency Translation Adjustment Balance as of December 31, 2017 $ (480,762 ) Other comprehensive income (loss) prior to reclassifications - Amounts reclassified from accumulated other comprehensive income - Tax effect - Net current period other comprehensive loss 249,709 Balance as of December 31, 2018 $ (231,053 )

Net Loss Per Share

Net Loss Per Share	12 Months Ended
	Dec. 31, 2018
Earnings Per Share [Abstract]
Net Loss Per Share	Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding for the period. Diluted net loss per share is computed by giving effect to all potential dilutive common stock equivalents for the period. For purposes of this calculation, options to purchase common stock, warrants and the conversion option of the convertible Notes (Note 4) are considered to be potential common shares outstanding. Computation of net income per share is as follows: Year Ended December 31, 2018 2017 Net loss $ (9,478,822 ) $ (4,669,835 ) Basic weighted average common shares outstanding 8,512,297 8,395,319 Add incremental shares for: Warrants - - Stock options - - Convertible notes - - Diluted weighted average common shares outstanding 8,512,297 8,395,319 Net loss per share: Basic $ (1.11 ) $ (0.56 ) Diluted $ (1.11 ) $ (0.56 ) Additionally, since the Company incurred net losses for each of the periods presented, diluted net loss per share is the same as basic net loss per share. The Company’s outstanding warrants, stock options, and convertible notes were not included in the calculation of diluted net loss per share as the effect would be anti-dilutive. The following table contains all potentially dilutive common stock equivalents: Year Ended December 31, 2018 2017 Warrants 30,000 80,000 Stock options 1,654,522 1,069,330 Convertible notes 1,107,240 -

Income Taxes

Income Taxes	12 Months Ended
	Dec. 31, 2018
Income Tax Disclosure [Abstract]
Income Taxes	On December 22, 2017, the Tax Act was enacted into the law. The Tax Act contains broad and complex provisions including, but not limited to: (i) the reduction of corporate income tax rate from 35% to 21%, (ii) requiring companies to pay a one-time transition tax on certain unrepatriated earnings of foreign subsidiaries, (iii) generally eliminating U.S. federal income taxes on dividends from foreign subsidiaries, (iv) modifying the limitation on excessive employee remuneration, (v) requiring current inclusion in U.S. federal taxable income of certain earnings of controlled foreign corporations, (vi) repeal of corporate alternative minimum tax (“AMT”) and changing how AMT credits can be realized, (vii) creating a new minimum tax, (viii) creating a new limitation on deductible interest expense, (ix) changing rules related to uses and limitations of net operating loss carryforwards and foreign tax credits created in tax years beginning after December 31, 2017, and (x) eliminating the deduction for income attributable to domestic production activities. At December 31, 2017, the Company calculated the accounting for the tax effects of the rate change from 35% to 21%, and recorded the effects on the existing deferred tax balances. Accordingly, we recorded incremental income tax benefits in the amounts of $0.2 million and $0.1 million, after the impact of the valuation allowance, associated with the Tax Act during the year ended December 31, 2018 and 2017, respectively. In response to the enactment of the Tax Act in late 2017, the U.S. Securities and Exchange Commission issued Staff Accounting Bulletin No. 118 (“SAB 118”) to address situations where the accounting is incomplete for certain income tax effects of the Tax Act upon issuance of an entity’s financial statements for the reporting period in which the Tax Act was enacted. Under SAB 118, a company may record provisional amounts during a measurement period for specific income tax effects of the Tax Act for which the accounting is incomplete, but a reasonable estimate can be determined, and when unable to determine a reasonable estimate for any income tax effects, report provisional amounts in the first reporting period in which a reasonable estimate can be determined. The Company recorded the impact of the tax effects of the Tax Act, relying on estimates where the accounting is incomplete as of December 31, 2018. The Company did not identify any changes to its original estimate of the impact of the Tax Act. As guidance and technical corrections are issued in the upcoming quarters, the Company will record updates to its provisional estimates. Income taxes for years ended December 31, is summarized as follows: 2018 2017 Current Provision Federal (154,872 ) (1,939,620 ) State 32,028 73,301 Foreign (40,018 ) (243,406 ) Current Income Tax Provision (162,862 ) (2,109,725 ) Deferred Provision Federal (143,988 ) (34,621 ) State (24,144 ) 7,257 Foreign - 32,981 Deferred Income Tax Provision (168,132 ) 5,617 Total Income Tax Provision (330,994 ) (2,104,108 ) A reconciliation of income tax for continuing operations computed at the U.S. statutory rate to the effective income tax rate is as follows: Year Ended Year Ended December 31, December 31, 2018 2017 Amount Percent Amount Percent Federal statutory rates $ (2,058,172 ) 21 % $ (2,369,986 ) 35 % State income taxes, net of federal benefit (194,244 ) 2 % (563,944 ) 8 % Permanent differences 66,068 -1 % 148,246 -2 % Rate Change - 0 % 672,562 -10 % Other (69,968 ) 1 % 141,284 -2 % Credits (147,727 ) 2 % (141,256 ) 2 % Foreign (80,534 ) 1 % 381,364 -6 % Valuation Allowance 2,153,583 -22 % (372,378 ) 5 % Effective rate $ (330,994 ) 3 % $ (2,104,108 ) 31 % The following is a summary of the components of the Company’s deferred tax assets: As of December 31, 2018 2017 Deferred tax assets (liabilities) Accrual to cash - 118,366 Stock-based compensation 226,476 193,620 Depreciation (252,795 ) (103,863 ) Intangibles 662,042 701,956 Net Operating Loss 3,630,772 1,110,387 Accruals & Reserves 75,685 - Net deferred tax asset valuation allowance (4,342,180 ) (2,188,598 ) Total net deferred tax assets (liabilities) $ - $ (168,132 ) The company has federal operating loss carryforwards of $9,282,866 and $0 as of December 31, 2018 and 2017. The company has foreign operating loss carryforwards of $3,203,562 and $2,530,855 as of December 31, 2018 and 2017, respectively. The company has state operating loss carryforwards of $15,001,960 and $9,242,128 as of December 31, 2018 and 2017, respectively. Depending on the jurisdiction, some of these operating loss carryovers will begin to expire within 3 years, while other net operating losses can be carried forward indefinitely as long as the company is operating. Valuation Allowance We record a deferred tax asset if we believe that it is more likely than not that we will realize a future tax benefit. Ultimate realization of any deferred tax asset is dependent on our ability to generate sufficient future taxable income in the appropriate tax jurisdiction before the expiration of carryforward periods, if any. Our assessment of deferred tax asset recoverability considers many different factors including historical and projected operating results, the reversal of existing deferred tax liabilities that provide a source of future taxable income, the impact of current tax planning strategies and the availability of future tax planning strategies. We establish a valuation allowance against any deferred tax asset for which we are unable to conclude that recoverability is more likely than not. This is inherently judgmental, since we are required to assess many different factors and evaluate as much objective evidence as we can in reaching an overall conclusion. The particularly sensitive component of our evaluation is our projection of future operating results since this relies heavily on our estimates of future revenue and expense levels by tax jurisdiction. We have established valuation allowances of $4.3 million and $2.2 million as of December 31, 2018 and December 31, 2017, respectively, against certain deferred tax assets given the uncertainty of recoverability of these amounts. In making our assessment of deferred tax asset recoverability, we considered our historical financial results, our projected future financial results, the planned reversal of existing deferred tax liabilities and the impact of any tax planning actions. Based on our analysis we noted both positive and negative factors relative to our ability to support realization of certain deferred tax assets. However, based on the weighting of all the evidence, including the near-term effect on our income projections of investments we are making in our team, product and systems infrastructure, we concluded that it was more likely than not that the majority of our deferred tax assets related to temporary differences and net operating losses may not be recovered. The establishment of a valuation allowance has no effect on our ability to use the underlying deferred tax assets prior to expiration to reduce cash tax payments in the future to the extent that we generate taxable income.

Defined Contribution Retirement

Defined Contribution Retirement Plan	12 Months Ended
	Dec. 31, 2018
Defined Contribution Retirement Plan
Defined Contribution Retirement Plan	Starting in 2016, we offered our U.S. employees the ability to participate in a 401(k) plan. Eligible U.S. employees may contribute up to 100% of their eligible compensation, subject to limitations established by the Internal Revenue Code. The Company contributes a matching contribution equal to 100% of each such participant’s contribution up to the first 3% of their annual eligible compensation. We charged $246,461 and $198,783, to expense in the years ended December 31, 2018 and 2017, respectively, associated with our matching contribution.

Related Party Transactions

Related Party Transactions	12 Months Ended
	Dec. 31, 2018
Related Party Transactions [Abstract]
Related Party Transactions	Intercompany transactions have been eliminated in our consolidated financial statements. The convertible notes issued in March 2018 are held directly by SHSP Holdings, LLC (“SHSP Holdings”). Daniel C. Allen, a director of SharpSpring Inc., is the founder and manager of Corona Park Investment Partners, LLC (“CPIP”). CPIP is a member of Evercel Holdings, LLC and is a member and sole manager of SHSP Holdings. Evercel, Inc. is a member and the manager of Evercel Holdings, LLC and is a member of SHSP Holdings. There were no other material related party transactions for the years ended December 31, 2018 or 2017.

Stock-Based Compensation

Stock-Based Compensation	12 Months Ended
	Dec. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-Based Compensation	From time to time, the Company grants stock option awards to officers and employees and grants stock awards to directors as compensation for their service to the Company. In November 2010, the Company adopted the 2010 Stock Incentive Plan (the “Plan”) which was amended in April 2011, August 2013, April 2014, February 2016, March 2017, and June 2018. As amended, up to 2,600,000 shares of common stock are available for issuance under the Plan. The Plan provides for the issuance of stock options and other stock-based awards. Stock Options Stock option awards under the Plan have a 10-year maximum contractual term and must be issued at an exercise price of not less than 100% of the fair market value of the common stock at the date of grant. The Plan is administered by the Board of Directors, which has the authority to determine to whom options may be granted, the period of exercise and what other restrictions, if any, should apply. Vesting for option awards granted to date under the Plan have been principally over four years from the date of the grant, with 25% of the award vesting after one year with monthly vesting thereafter. Option awards are valued based on the grant date fair value of the instruments, net of estimated forfeitures, using a Black-Scholes option pricing model with the following assumptions: Year Ended December 31, 2018 2017 Volatility 48% - 49% 48% - 49% Risk-free interest rate 2.34% - 3.11% 1.85% - 2.26% Expected term 6.25 years 6.25 years The weighted average grant date fair value of stock options granted during the year ended December 31, 2018 was $7.74. For grants prior to January 1, 2015, the volatility assumption was based on historical volatility of similar sized companies due to lack of historical data of the Company’s stock price. For all grants subsequent to January 1, 2015, the volatility assumption reflects the Company’s historic stock volatility for the period of February 1, 2014 forward, which is the date the Company’s stock started actively trading. The risk free interest rate was determined based on treasury securities with maturities equal to the expected term of the underlying award. The expected term was determined based on the simplified method outlined in Staff Accounting Bulletin No. 110. Stock option awards are expensed on a straight-line basis over the requisite service period. During the year ended December 31, 2018 and 2017, the Company recognized expense of $801,655 and $510,978, respectively, associated with stock option awards. At December 31, 2018, future stock compensation expense associated with stock options (net of estimated forfeitures) not yet recognized was $2,485,163 and will be recognized over a weighted average remaining vesting period of 3.18 years. The following summarizes stock option activity for the year ended December 31, 2018: Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life Aggregate Intrinsic Value Outstanding at December 31, 2017 1,069,330 $ 5.11 7.8 $ 90,007 Granted 898,100 7.74 Exercised (113,090 ) 5.34 Expired (35,481 ) 7.60 Forfeited (164,337 ) 9.07 Outstanding at December 31, 2018 1,654,522 $ 6.07 8.2 $ 10,866,658 Exercisable at December 31, 2018 623,649 $ 5.12 7.0 $ 2,072,937 The total intrinsic value of stock options exercised during the year ended December 31, 2018 and 2017 was $607,220 and $34,373 respectively. Stock Awards During the year ended December 31, 2018 and 2017, the Company issued 23,302 and 60,011 shares, respectively, to non-employee directors as compensation for their service on the board. Such stock awards are immediately vested. Stock awards are valued based on the closing price of our common stock on the date of grant, and compensation cost is recorded immediately if there is no vesting period or on a straight-line basis over the vesting period. The total fair value of stock awards granted, vested and expensed during the year ended December 31, 2018 and 2017 was $178,022 and $272,976, respectively. As of December 31, 2018, there was no unrecognized compensation cost related to stock awards. Additionally, during the year ended December 31, 2018, the Company issued 36,274 shares to a service provider to satisfy a performance-based contractual arrangement. The Company recorded an expense of approximately $509,000 associated with this issuance in the third quarter of 2018. These shares were not issued from the 2010 Stock Incentive Plan.

Warrants

Warrants	12 Months Ended
	Dec. 31, 2018
Warrants and Rights Note Disclosure [Abstract]
Warrants	On January 30, 2014, in connection with an $11.5 million financing transaction, the Company issued 80,000 warrants to purchase common stock at an exercise price of $7.81 per share with a term of 5 years. The fair value of the warrants was determined using the Black-Scholes option valuation model. The warrants expire on January 30, 2020 and have a remaining contractual life of 1.1 years as of December 31, 2018. These warrants became exercisable on January 30, 2015. The following table summarizes information about the Company’s warrants at December 31, 2018: Number of Units Weighted Average Exercise Price Weighted Average Remaining Contractual Term Intrinsic Value Outstanding at December 31, 2017 80,000 $ 7.81 2.1 $ 33,660 Granted - - Exercised (50,000 ) 7.81 Cancelled - - Outstanding at December 31, 2018 30,000 $ 7.81 1.1 $ 144,525 Exercisable at December 31, 2018 30,000 $ 7.81 1.1 $ 144,525 No warrants were issued in 2018 or 2017.

Commitments and Contingencies

Commitments and Contingencies	12 Months Ended
	Dec. 31, 2018
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Litigation The Company may from time to time be involved in legal proceedings arising from the normal course of business. The Company is not a party to any litigation of a material nature. Operating Leases and Service Contracts The Company currently rents its primary office facility under a ten-year lease which started in November 2018 (the “2018 Lease”). On April 18, 2018, the Company entered into a lease for the Company’s new principal office to lease approximately 25,000 square feet of office space. The 2018 Lease began on, November 1, 2018, the date in which the Company took possession of and occupied the premises for normal business activities. The term may be extended for an additional 5 years in incremental one-year periods, subject to certain conditions described in the 2018 Lease. Base rent for the first year of the 2018 Lease is approximately $619,000, with increases in base rent occurring every two years. In conjunction with the signing of the 2018 Lease, the Company has agreed to assign the lease of our prior primary office (the “2016 Lease”) to the landlord from the 2018 Lease (the “Assignment”). If the landlord shall fail to pay the 2016 Lease obligations under the Assignment, the Company will be obligated to pay the obligations, but has a contractual right to reduce its payments to the landlord related to the 2018 Lease by equal amounts. Most of the Company’s service contracts are on a month-to-month basis, however, some contracts and agreements extend out to longer periods. Future minimum lease payments and payments due under non-cancelable service contracts are as follows as of December 31, 2018: 2019 $ 738,238 2020 742,956 2021 766,546 2022 771,278 2023 794,937 Thereafter 4,012,539 Total $ 7,826,495 Sales and Franchise Taxes State, local and foreign jurisdictions have differing rules and regulations governing sales, franchise, use, value added and other taxes, and these rules and regulations are subject to varying interpretations that may change over time. In particular, the applicability of such taxes to SaaS products in various jurisdictions is unclear. Further, these jurisdictions’ rules regarding tax nexus vary significantly and are complex. As such, we could face possible tax assessments and audits. A successful assertion, by any of these taxing authorities, that we should be collecting additional sales, use, value added or other taxes in jurisdictions where we have not historically done so and do not accrue for such taxes could result in tax liabilities and related penalties for past sales, discourage customers from purchasing our products or otherwise harm our business and operating results. We are currently evaluating the impact of various tax types which may require future sales, franchise, or other tax payments. Employment Agreements The Company has employment agreements with several members of its leadership team and executive officers.

Disaggregation of Revenue

Disaggregation of Revenue	12 Months Ended
	Dec. 31, 2018
Revenue from Contract with Customer [Abstract]
Disaggregation of Revenue	The Company operates as one reporting segment. Operating segments are defined as components of an enterprise for which separate financial information in regularly evaluated by the chief operating decision maker (“CODM”), which is the Company’s chief executive officer, in deciding how to allocate resources and assess performance. The Company does not present geographical information about revenues because it is impractical to do so. Disaggregated revenue for the year ended December 31, 2018 and 2017 are as follows: Year Ended December 31, 2018 2017 Revenue by Product: Mail + Product Revenue $ 390,806 $ 653,316 Marketing Automation Revenue 18,260,719 12,795,436 Total Revenue $ 18,651,525 $ 13,448,752 Revenue by Type: Upfront Fees $ 1,601,580 $ 1,100,167 Recurring Revenue 17,049,945 12,348,585 Total Revenue $ 18,651,525 $ 13,448,752

Cash Flows

Cash Flows	12 Months Ended
	Dec. 31, 2018
Cash Flows
Cash Flows	The Statement of Cash Flows consists of cash flows from continuing operations except for $1.0 million from investing activities for the year ending December 31, 2017, noted on the face of the Statement of Cash Flows. This cash flow is the receipt of an escrowed account receivable related to the sale of the SMTP business in 2016 treated as a discontinued operation.

Restructuring

Restructuring	12 Months Ended
	Dec. 31, 2018
Restructuring and Related Activities [Abstract]
Restructuring	During the year ended December 31, 2018, in an effort to consolidate operations into the Company headquarters, the Company executed a plan to close its Northeast operations as well as transition of the chief financial officer position to Company headquarters. The Company recorded pre-tax restructuring expenses associated with severance and transition of the CFO of $252,314.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Dec. 31, 2018
Accounting Policies [Abstract]
Basis of Presentation and Consolidation	The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP). Our Consolidated Financial Statements include the accounts of SharpSpring, Inc. and our subsidiaries (the “Company”). Our Consolidated Financial Statements reflect the elimination of all significant inter-company accounts and transactions.
Use of Estimates	The preparation of the consolidated financial statements in conformity with U.S. 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 consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Operating Segments	The Company operates as one operating segment. Operating segments are defined as components of an enterprise for which separate financial information is regularly evaluated by the chief operating decision maker (“CODM”), which is the Company’s chief executive officer, in deciding how to allocate resources and assess performance. The Company’s CODM evaluates the Company’s financial information and resources and assess the performance of these resources on a consolidated basis. The Company does not present geographical information about revenues because it is impractical to do so.
Cash and Cash Equivalents	Cash equivalents are short-term, liquid investments with remaining maturities of three months or less when acquired. Cash and cash equivalents are deposited or managed by major financial institutions and at most times are in excess of Federal Deposit Insurance Corporation (FDIC) insurance limits.
Fair Value of Financial Instruments	U.S. GAAP establishes a fair value hierarchy which has three levels based on the reliability of the inputs to determine the fair value. These levels include: Level 1, defined as inputs such as unadjusted quoted prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for use when little or no market data exists, therefore requiring an entity to develop its own assumptions. The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, deposits, embedded derivatives (associated with our convertible notes) and accounts payable. The carrying amount of cash and cash equivalents, accounts receivable and accounts payable approximates fair value because of the short-term nature of these items. The fair value of the embedded derivatives associated with our convertible notes is calculated using Level 3 unobservable inputs, utilizing a probability-weighted expected value model to determine the liability. The fair value of the embedded derivatives at December 31, 2018 and December 31, 2017 was a liability balance of $214,350 and zero, respectively. The change in fair value for the year ended December 31, 2018 was a loss of $400,220.
Accounts Receivable	In cases where our customers pay for services in arrears, we accrue for revenue in advance of billings as long as the criteria for revenue recognition is met, thus creating a contract asset. A portion of our accounts receivable balance is therefore unbilled at each balance sheet date. Accounts receivable are carried at the original invoiced amount less an allowance for doubtful accounts based on the probability of future collection. Management reviews accounts receivable on a periodic basis to determine if any receivables will potentially be uncollectible. The Company reserves for receivables that are determined to be uncollectible, if any, in its allowance for doubtful accounts. After the Company has exhausted all collection efforts, the outstanding receivable is written off against the allowance. The following table presents the balances of accounts receivable as of December 31, 2018 and December 31, 2017: December 31, December 31, 2018 2017 Accounts receivable $ 208,037 $ 611,293 Unbilled receivables 740,425 554,603 Gross receivables $ 948,462 $ 1,165,896 Allowance for doubtful accounts (127,516 ) (525,937 ) Accounts receivable and unbilled receivables, net $ 820,946 $ 639,959 During the year ended December 31, 2018, the Company wrote off approximately $494,000 of accounts receivable against the allowance for doubtful accounts, with zero net loss recognized in the period for this amount as the accounts were fully reserved. Allowance for doubtful accounts increased by approximately $58,000 due to bad debt and changes in revenue reserves. The remaining change in allowance for doubtful accounts is due to fluctuations in foreign currency rates. No amounts were written off during the year ended December 31, 2017.
Intangibles	Finite-lived intangible assets include trade names, developed technologies and customer relationships and are amortized based on the estimated economic benefit over their estimated useful lives, with original periods ranging from 5 to 11 years. We continually evaluate the reasonableness of the useful lives of these assets. Finite-lived intangibles are tested for recoverability whenever events or changes in circumstances indicate the carrying amounts may not be recoverable. Impairment losses are measured as the amount by which the carrying value of an asset group exceeds its fair value and are recognized in operating results. Judgment is used when applying these impairment rules to determine the timing of the impairment test, the undiscounted cash flows used to assess impairments and the fair value of an asset group. The dynamic economic environment in which the Company operates, and the resulting assumptions used to estimate future cash flows impact the outcome of these impairment tests.
Goodwill and Impairment	As of December 31, 2018 and 2017, we had recorded goodwill of $8,866,413 and $8,872,898, respectively. Goodwill consists of the excess of the purchase price over the fair value of tangible and identifiable intangible net assets acquired in the SharpSpring and GraphicMail acquisitions (See Note 3). Under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 350, “Intangibles - Goodwill and Other”
Debt Issuance Costs	We incurred certain third-party costs in connection with the issuance of the 5% Convertible Notes maturing March 27, 2023 (the “Notes”), as more fully described in Note 4: Convertible Notes, principally related to legal and financial advisory fees. These costs are included as a direct reduction to the carrying value of the debt as part of the Notes on our consolidated balance sheets and are being amortized to interest expense ratably over the five-year term of the Notes. Estimated amortization expense of debt issuance costs for subsequent years is as follows: 2019 26,585 2020 27,885 2021 29,247 2022 30,677 2023 7,759 Total $ 122,153
Income Taxes	Provision for income taxes are based on taxes payable or refundable for the current year and deferred taxes on temporary differences between the amount of taxable income and pretax financial income and between the tax bases of assets and liabilities and their reported amounts in the financial statements. Deferred tax assets and liabilities are included in the financial statements at currently enacted income tax rates applicable to the period in which the deferred tax assets and liabilities are expected to be realized or settled as prescribed in FASB ASC 740, Accounting for Income Taxes. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes. A valuation allowance is established to reduce deferred tax assets if it is more likely than not that a deferred tax asset will not be realized. The Company applies the authoritative guidance in accounting for uncertainty in income taxes recognized in the consolidated financial statements. This guidance prescribes a two-step process to determine the amount of tax benefit to be recognized. First, the tax position must be evaluated to determine the likelihood that it will be sustained upon external examination. If the tax position is deemed “more-likely-than-not” to be sustained, the tax position is then assessed to determine the amount of benefit to recognize in the financial statements. The amount of the benefit that may be recognized is the largest amount that has a greater than 50% likelihood of being realized upon ultimate settlement. There are no material uncertain tax positions taken by the Company on its tax returns. Tax years subsequent to 2014 remain open to examination by U.S. federal and state tax jurisdictions. In determining the provision for income taxes, the Company uses statutory tax rates and tax planning opportunities available to the Company in the jurisdictions in which it operates. This includes recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the consolidated financial statements or tax returns to the extent pervasive evidence exists that they will be realized in future periods. The deferred tax balances are adjusted to reflect tax rates by tax jurisdiction, based on currently enacted tax laws, which are expected to be in effect in the years in which the temporary differences are expected to reverse. In accordance with the Company’s income tax policy, significant or unusual items are separately recognized in the period in which they occur. The Company is subject to routine examination by domestic and foreign tax authorities and frequently faces challenges regarding the amount of taxes due. These challenges include positions taken by the Company related to the timing, nature and amount of deductions and the allocation of income among various tax jurisdictions. As of December 31, 2018, the Company is being examined by the U.S. tax authorities related to the 2016 and 2017 tax years. The company does not expect any material adjustments as a result of the audit.
Property and Equipment	Property and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful life of the assets. Upon retirement or sale, the cost of assets disposed of and the related accumulated depreciation are eliminated from the accounts and any resulting gain or loss is credited or charged to operations. Repairs and maintenance costs are expensed as incurred. Depreciation expense from continuing operations related to property and equipment was $432,233 and $280,106 for the years ended December 31, 2018 and 2017, respectively. Property and equipment as of December 31 is as follows: December 31, December 31, 2018 2017 Property and equipment, gross: Leasehold improvements $ 197,268 $ 128,122 Furniture and fixtures 611,171 355,033 Computer equipment and software 1,135,012 776,201 Total 1,943,451 1,259,356 Less: Accumulated depreciation and amortization (682,653 ) (460,211 ) $ 1,260,798 $ 799,145 Useful lives are as follows: Leasehold improvements 5 years Furniture and fixtures 3-5 years Computing equipment 3 years Software 3-5 years
Revenue Recognition	The Company recognizes revenue from its services when it is probable that the economic benefits associated with the transactions will flow to the Company and the amount of revenue can be measured reliably. All significant sources of revenue are the result of a contract with a customer, and as such meet all of the requirements of recognizing revenue in accordance with FASB ASC 606. For the year ended December 31, 2018 and 2017, revenue from contracts with customers was $18.7 million and $13.5 million, respectively. For the Company’s internet-based SharpSpring marketing automation solution, the services are typically offered on a month-to-month basis with a fee charged each month depending on the size of the engagement with the customer. Monthly fees are recorded as revenue during the month they are earned. Some customers are charged annually in advance, for which revenues are deferred and recorded ratably over the subscription period. The Company also charges transactional-based fees if monthly volume limitations are reached or other chargeable activity occurs. Additionally, customers are typically charged an upfront onboarding and training services. The upfront implementation and training fees represent short-term “use it or lose it” services offered for a flat fee. Such flat fees are recognized over the service period, which is typically 60 days. For the SharpSpring Mail+ product, the services are typically offered on a month-to-month basis. Customers are either charged in arrears based on the number of contacts in the system during the billing period or in advance if the customer selects a plan based on e-mail volume. The Company also charges transactional-based fees if monthly volume limitations are reached or other chargeable activity occurs. Our products are billed in arrears or upfront, depending on the product, which creates contract assets (accrued revenue) and contract liabilities (deferred revenue). Contract assets occur due to unbilled charges for which the Company has satisfied performance obligations. Contract liabilities occur due to billing up front for charges that the Company has not yet fully satisfied all performance obligations. Both contract assets and liabilities are recognized and deferred ratably over their service periods. The Company makes judgements when determining revenue recognition. Because many of our contracts are billed in arrears, estimates are made for the transaction price and amounts allocated to each accounting period related to the performance obligations of each contract. There have been no changes to the methodology used in these judgements and estimates for determining revenues. Some of the estimates used when determining revenue recognition relate to variable customer consideration that changes from month to month. The Company uses the most likely amount method to determine the estimated variable consideration, relying on historical consideration received, customer status and projected usage to determine the most likely consideration amount. The amount of variable consideration recognized is constrained and is only included in the transaction price to the extent that it is probable that a significant reversal of cumulative revenue recognized will not occur. The performance obligations are measured using the output method to recognize revenue based on direct measurements of the value to the customer of the services transferred to date. Most of the Company’s contracts are satisfied over time, and as each contract has a predefined service period. This allows for a reliable way to measure performance obligations remaining and completed. The Company does have some contracts that are satisfied at a point in time upon delivery of services. The criteria for the completion of these contracts is defined in each contract with a customer so that there is no judgment required in evaluating when the service is delivered to the customer. Any discount given is allocated to the performance obligation and is treated as reduction to the transaction price. Due to the month to month nature of the Company’s contracts with customers, no financing or time value of money component exists related to the contracts with customers. Due to the month to month nature of the Company’s contracts with customers, we have elected to utilize the optional practical expedient from ASC 606-10-50-14 through 50-14A for disclosing the remaining performance obligations. The remaining performance obligations as of the balance sheet date consist of trainings and availability and use of the SharpSpring platform over the remainder of the contract, which is typically less than 30 days. From time to time, the Company offers refunds to customers and experiences credit card chargebacks relating to cardholder disputes that are commonly experienced by businesses that accept credit cards. The Company makes estimates for refunds and credit card chargebacks based on historical experience.
Deferred Revenue	Deferred revenue consists of payments received in advance of the Company’s providing the services. Deferred revenue is earned over the service period identified in each contract. The majority of our deferred revenue balances (contract liabilities) arise from upfront implementation and training fees for its SharpSpring marketing automation solution that are paid in advance. These services are typically performed over a 60-day period, and the revenue is recognized over that period. Additionally, some of the Company’s customers pay for services in advance on a periodic basis (such as monthly, quarterly, annually or bi-annually). In situations where a customer pays in advance for a one-year service period, the deferred revenue is recognized over that service period. Deferred revenue balances were $279,818 and $280,159 as of December 31, 2017 and 2016, respectively. Deferred revenue during the year ended December 31, 2018 and 2017 decreased by $29,162 and $340, respectively. The Company had deferred revenue contract liability balances of $250,656 and $279,818 as of December 31, 2018 and 2017, respectively. The Company expects to recognize a majority of the revenue on of these remaining performance obligations within 12 months. Approximately 20% of the deferred revenue balance is related to prepaid credits. These credits are recognized as they are used. The Company expects to recognize approximately half of the remaining credits within 12 months.
Accrued Revenue	In cases where our customers pay for services in arrears, we accrue for revenue in advance of billings as long as the criteria for revenue recognition is met, thus creating a contract asset. A portion of our accounts receivable balance is therefore unbilled at each balance sheet date. The accrued revenue contract asset balances were $554,603 and $439,559 as of December 31, 2017 and 2016, respectively. Revenue billed that was included in accrued revenue at the beginning of the year ended December 31, 2018 and 2017 was $554,603 and $439,559, respectively. Accrued revenue not billed in year ended December 31, 2018 and 2017 was $740,425 and $554,603, respectively. The Company had accrued revenue contract asset balances of $740,425 and $554,603 as of December 31, 2018 and 2017, respectively.
Concentration of Credit Risks and Significant Customers	Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash, cash equivalents. At December 31, 2018 and 2017, the Company had cash balances at financial institutions that exceed federally insured limits. The Company maintains its cash balances with accredited financial institutions. The Company does not believe it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships. For the years ended December 31, 2018, and 2017, there were no customers that accounted for more than 10% of total revenue or 10% of total accounts receivable.
Cost of Services	Cost of services consists primarily of direct labor costs associated with support and customer onboarding and technology hosting costs and license costs associated with the cloud-based platform.
Credit Card Processing Fees	Credit card processing fees are included as a component of general and administrative expenses and are expensed as incurred.
Advertising Costs	The Company expenses advertising costs as incurred. Advertising and marketing expenses, excluding marketing team costs, were $5.7 million and $3.2 million for the years ended December 31, 2018 and 2017, respectively.
Research and Development Costs and Capitalized Software Costs	The Company capitalizes sales commission costs which are incremental to obtaining a contract. We expense costs that are related to obtaining a contract but are not incremental such as other sales and marketing costs and other costs that would be incurred regardless of if the contract was obtained. Capitalized costs are amortized using straight-line amortization over the estimated weighted average life of the customer, which we have estimated to be 3 years. At December 31, 2018, the net carrying value of the capitalized cost of obtaining a contract was $1,309,329, of which $699,159 is included in other current assets and $610,170 is included in other long-term assets. At December 31, 2017, the net carrying value of the capitalized cost of obtaining a contract was $1,218,833, of which $631,203 is included in other current assets and $587,630 is included in other long-term assets. The Company amortized costs directly attributable to obtaining contracts of $758,014 and $557,495 during the year ended December 31, 2018 and 2017, respectively. Such capitalized cost adjustments have been retroactively applied to prior periods.
Stock Compensation	We account for stock-based compensation in accordance with FASB ASC 718 “Compensation - Stock Compensation”, which requires companies to measure the cost of employee services received in exchange for an award of an equity instrument based on the grant-date fair value of the award. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period.
Net Income (Loss) Per Share	Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding for the period. Diluted net loss per share is computed by giving effect to all potential dilutive common stock equivalents for the period. For purposes of this calculation, options to purchase common stock, warrants and the conversion option of the convertible Notes (Note 4) are considered to be potential common shares outstanding. Since the Company incurred net losses for each of the periods presented, diluted net loss per share is the same as basic net loss per share. The Company’s potential common shares outstanding were not included in the calculation of diluted net loss per share as the effect would be anti-dilutive.
Comprehensive Income or Loss	Comprehensive income or loss includes all changes in equity during a period from non-owner sources, such as net income or loss and foreign currency translation adjustments.
Foreign Currency	The functional currency of the Company’s foreign subsidiaries is the local currency. Assets and liabilities denominated in a foreign currency are translated into U.S. dollars at the exchange rates in effect at the balance sheet dates; with the resulting translation adjustments directly recorded to a separate component of accumulated other comprehensive loss. Income and expense accounts are translated at the average exchange rates during the period. Foreign currency transaction gains and losses are recorded in other comprehensive income (loss).
Recently Issued Accounting Standards	Recent accounting standards not included below are not expected to have a material impact on our consolidated financial position and results of operations. In January 2017, the FASB issued guidance simplifying the accounting for goodwill impairment by removing Step 2 of the goodwill impairment test. Under current guidance, Step 2 of the goodwill impairment test requires entities to calculate the implied fair value of goodwill in the same manner as the amount of goodwill recognized in a business combination by assigning the fair value of a reporting unit to all of the assets and liabilities of the reporting unit. The carrying value in excess of the implied fair value is recognized as goodwill impairment. Under the new standard, goodwill impairment is recognized based on Step 1 of the current guidance, which calculates the carrying value in excess of the reporting unit’s fair value. The new standard is effective beginning in January 2020, with early adoption permitted. We do not believe the adoption of this guidance will have a material impact on our consolidated financial statements. In February 2016, the FASB issued guidance that requires lessees to recognize most leases on their balance sheets but record expenses on their income statements in a manner similar to current accounting. For lessors, the guidance modifies the classification criteria and the accounting for sales-type and direct financing leases. The guidance is effective in 2019 with early adoption permitted. The Company is currently evaluating the impact of this guidance on the consolidated financial statements. In May 2014, the FASB issued updated guidance and disclosure requirements for recognizing revenue from contracts with customers. This new revenue recognition standard became effective for the Company on January 1, 2018. In addition to providing guidance on when and how revenue is recognized, the new standard also provides guidance on accounting for costs of obtaining contracts primarily related to aligning the expense with the period in which the value is recognized. As a result of this new standard, the Company was required to capitalize certain costs related to obtaining contracts associated with commissions expense paid to salespeople. The Company is using the retrospective transition method to adjust each prior reporting period presented for this new method of accounting for costs associated with obtaining contracts. The application of the retrospective transition was applied to all contracts at the date of initial application. The following tables present our results under our historical method and as adjusted to reflect these accounting changes. Historical Accounting Method Effect of Adoption of New ASU As Adjusted Year Ended December 31, 2018 Sales and Marketing Expense 10,183,186 (90,495 ) 10,092,691 Total operating expense 21,807,865 (90,495 ) 21,717,370 Operating loss (8,954,609 ) 90,495 (8,864,114 ) Loss before income taxes (9,900,311 ) 90,495 (9,809,816 ) Net loss (9,569,317 ) 90,495 (9,478,822 ) Basic net loss per share (1.12 ) 0.01 (1.11 ) Diluted net loss per share (1.12 ) 0.01 (1.11 ) Balance as of December 31, 2018 Other current assets 485,058 699,159 1,184,217 Other long-term assets 54,954 610,169 665,123 Total assets 22,697,947 1,309,329 24,007,276 Accumulated deficit (18,662,035 ) 1,309,329 (17,352,706 ) Historical Accounting Method Effect of Adoption of New ASU As Adjusted Year Ended December 31, 2017 Sales and Marketing Expense 6,983,208 (305,401 ) 6,677,807 Total operating expense 15,740,526 (305,401 ) 15,435,125 Operating loss (7,288,519 ) 305,401 (6,983,118 ) Loss before income taxes (7,079,344 ) 305,401 (6,773,943 ) Net loss (4,975,236 ) 305,401 (4,669,835 ) Basic net loss per share (0.59 ) 0.04 (0.56 ) Diluted net loss per share (0.59 ) 0.04 (0.56 ) Balance as of December 31, 2017 Other current assets 267,924 631,203 899,127 Other long-term assets 25,000 587,631 612,631 Total assets 20,463,289 1,218,834 21,682,123 Accumulated deficit (9,092,717 ) 1,218,834 (7,873,883 )

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	12 Months Ended
	Dec. 31, 2018
Accounting Policies [Abstract]
Schedule of Accounts Receivable and Unbilled Receivables	December 31, December 31, 2018 2017 Accounts receivable $ 208,037 $ 611,293 Unbilled receivables 740,425 554,603 Gross receivables $ 948,462 $ 1,165,896 Allowance for doubtful accounts (127,516 ) (525,937 ) Accounts receivable and unbilled receivables, net $ 820,946 $ 639,959
Schedule of Debt Issuance Cost Amortization	2019 26,585 2020 27,885 2021 29,247 2022 30,677 2023 7,759 Total $ 122,153
Schedule of Property and Equipment	December 31, December 31, 2018 2017 Property and equipment, gross: Leasehold improvements $ 197,268 $ 128,122 Furniture and fixtures 611,171 355,033 Computer equipment and software 1,135,012 776,201 Total 1,943,451 1,259,356 Less: Accumulated depreciation and amortization (682,653 ) (460,211 ) $ 1,260,798 $ 799,145
Schedule of Property and Equipment Useful Lives	Leasehold improvements 5 years Furniture and fixtures 3-5 years Computing equipment 3 years Software 3-5 years
Accounting Change Adjustments	Historical Accounting Method Effect of Adoption of New ASU As Adjusted Year Ended December 31, 2018 Sales and Marketing Expense 10,183,186 (90,495 ) 10,092,691 Total operating expense 21,807,865 (90,495 ) 21,717,370 Operating loss (8,954,609 ) 90,495 (8,864,114 ) Loss before income taxes (9,900,311 ) 90,495 (9,809,816 ) Net loss (9,569,317 ) 90,495 (9,478,822 ) Basic net loss per share (1.12 ) 0.01 (1.11 ) Diluted net loss per share (1.12 ) 0.01 (1.11 ) Balance as of December 31, 2018 Other current assets 485,058 699,159 1,184,217 Other long-term assets 54,954 610,169 665,123 Total assets 22,697,947 1,309,329 24,007,276 Accumulated deficit (18,662,035 ) 1,309,329 (17,352,706 ) Historical Accounting Method Effect of Adoption of New ASU As Adjusted Year Ended December 31, 2017 Sales and Marketing Expense 6,983,208 (305,401 ) 6,677,807 Total operating expense 15,740,526 (305,401 ) 15,435,125 Operating loss (7,288,519 ) 305,401 (6,983,118 ) Loss before income taxes (7,079,344 ) 305,401 (6,773,943 ) Net loss (4,975,236 ) 305,401 (4,669,835 ) Basic net loss per share (0.59 ) 0.04 (0.56 ) Diluted net loss per share (0.59 ) 0.04 (0.56 ) Balance as of December 31, 2017 Other current assets 267,924 631,203 899,127 Other long-term assets 25,000 587,631 612,631 Total assets 20,463,289 1,218,834 21,682,123 Accumulated deficit (9,092,717 ) 1,218,834 (7,873,883 )

Convertible Notes (Tables)

Convertible Notes (Tables)	12 Months Ended
	Dec. 31, 2018
Debt Disclosure [Abstract]
Net Carrying Amount - Notes	Year Ended December 31, 2018 Principal amount $ 8,000,000 Accrued interest paid-in-kind 304,301 Unamortized debt issuance costs (122,153 ) Original embedded derivative conversion feature 160,278 Net carrying value $ 8,342,426
Interest Expense	Year Ended December 31, 2018 Contractual interest paid-in-kind expense (non-cash) $ 304,301 Amortization of debt issuance costs (non-cash) 19,504 Amortization of embedded derivative (non-cash) (25,592 ) Total interest expense $ 298,213 Effective interest rate 4.9 %

Goodwill and Other Intangible_2

Goodwill and Other Intangible Assets (Tables)	12 Months Ended
	Dec. 31, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of Intangible Assets	As of December 31, 2018 Gross Net Carrying Accumulated Carrying Amount Amortization Value Amortized intangible assets: Trade names $ 120,000 (120,000 ) $ - Technology 2,130,000 (954,000 ) 1,176,000 Customer relationships 4,100,014 (3,410,014 ) 690,000 Unamortized intangible assets: 6,350,014 (4,484,014 ) 1,866,000 Goodwill 8,866,413 Total goodwill and intangible assets $ 10,732,413 As of December 31, 2017 Gross Net Carrying Accumulated Carrying Amount Amortization Value Amortized intangible assets: Trade names $ 346,644 $ (309,640 ) $ 37,004 Technology 3,834,023 (2,404,023 ) 1,430,000 Customer relationships 4,165,665 (3,306,669 ) 858,996 Unamortized intangible assets: 8,346,332 (6,020,332 ) 2,326,000 Goodwill 8,872,898 Total intangible assets $ 11,198,898
Schedule of Estimated Amortization Expense	2019 381,000 2020 332,000 2021 280,000 2022 228,000 2023 180,000 Thereafter 465,000 Total $ 1,866,000

Changes in Accumulated Other _2

Changes in Accumulated Other Comprehensive Income (Loss) (Tables)	12 Months Ended
	Dec. 31, 2018
Equity [Abstract]
Schedule of Accumulated Other Comprehensive Income (Loss)	Foreign Currency Translation Adjustment Balance as of December 31, 2017 $ (480,762 ) Other comprehensive income (loss) prior to reclassifications - Amounts reclassified from accumulated other comprehensive income - Tax effect - Net current period other comprehensive loss 249,709 Balance as of December 31, 2018 $ (231,053 )

Net Loss Per Share (Tables)

Net Loss Per Share (Tables)	12 Months Ended
	Dec. 31, 2018
Earnings Per Share [Abstract]
Schedule of Computation of Net Income Per Share	Year Ended December 31, 2018 2017 Net loss $ (9,478,822 ) $ (4,669,835 ) Basic weighted average common shares outstanding 8,512,297 8,395,319 Add incremental shares for: Warrants - - Stock options - - Convertible notes - - Diluted weighted average common shares outstanding 8,512,297 8,395,319 Net loss per share: Basic $ (1.11 ) $ (0.56 ) Diluted $ (1.11 ) $ (0.56 )
Schedule of Potentially Dilutive Common Stock Equivalents	Year Ended December 31, 2018 2017 Warrants 30,000 80,000 Stock options 1,654,522 1,069,330 Convertible notes 1,107,240 -

Income Taxes (Tables)

Income Taxes (Tables)	12 Months Ended
	Dec. 31, 2018
Income Tax Disclosure [Abstract]
Schedule of Components of Income Tax Expense	2018 2017 Current Provision Federal (154,872 ) (1,939,620 ) State 32,028 73,301 Foreign (40,018 ) (243,406 ) Current Income Tax Provision (162,862 ) (2,109,725 ) Deferred Provision Federal (143,988 ) (34,621 ) State (24,144 ) 7,257 Foreign - 32,981 Deferred Income Tax Provision (168,132 ) 5,617 Total Income Tax Provision (330,994 ) (2,104,108 )
Schedule of Income Tax Rate Reconciliation	Year Ended Year Ended December 31, December 31, 2018 2017 Amount Percent Amount Percent Federal statutory rates $ (2,058,172 ) 21 % $ (2,369,986 ) 35 % State income taxes, net of federal benefit (194,244 ) 2 % (563,944 ) 8 % Permanent differences 66,068 -1 % 148,246 -2 % Rate Change - 0 % 672,562 -10 % Other (69,968 ) 1 % 141,284 -2 % Credits (147,727 ) 2 % (141,256 ) 2 % Foreign (80,534 ) 1 % 381,364 -6 % Valuation Allowance 2,153,583 -22 % (372,378 ) 5 % Effective rate $ (330,994 ) 3 % $ (2,104,108 ) 31 %
Schedule of Deferred Tax Assets and Liabilities	As of December 31, 2018 2017 Deferred tax assets (liabilities) Accrual to cash - 118,366 Stock-based compensation 226,476 193,620 Depreciation (252,795 ) (103,863 ) Intangibles 662,042 701,956 Net Operating Loss 3,630,772 1,110,387 Accruals & Reserves 75,685 - Net deferred tax asset valuation allowance (4,342,180 ) (2,188,598 ) Total net deferred tax assets (liabilities) $ - $ (168,132 )

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	12 Months Ended
	Dec. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Schedule of Fair Value Assumptions Used in Valuing Stock Options	Year Ended December 31, 2018 2017 Volatility 48% - 49% 48% - 49% Risk-free interest rate 2.34% - 3.11% 1.85% - 2.26% Expected term 6.25 years 6.25 years
Schedule of Stock Option Activity	Number of Options Weighted Average Exercise Price Weighted Average Remaining Contractual Life Aggregate Intrinsic Value Outstanding at December 31, 2017 1,069,330 $ 5.11 7.8 $ 90,007 Granted 898,100 7.74 Exercised (113,090 ) 5.34 Expired (35,481 ) 7.60 Forfeited (164,337 ) 9.07 Outstanding at December 31, 2018 1,654,522 $ 6.07 8.2 $ 10,866,658 Exercisable at December 31, 2018 623,649 $ 5.12 7.0 $ 2,072,937

Warrants (Tables)

Warrants (Tables)	12 Months Ended
	Dec. 31, 2018
Warrants and Rights Note Disclosure [Abstract]
Summary of Warrants Activity	Number of Units Weighted Average Exercise Price Weighted Average Remaining Contractual Term Intrinsic Value Outstanding at December 31, 2017 80,000 $ 7.81 2.1 $ 33,660 Granted - - Exercised (50,000 ) 7.81 Cancelled - - Outstanding at December 31, 2018 30,000 $ 7.81 1.1 $ 144,525 Exercisable at December 31, 2018 30,000 $ 7.81 1.1 $ 144,525

Commitments and Contingencies (

Commitments and Contingencies (Tables)	12 Months Ended
	Dec. 31, 2018
Commitments and Contingencies Disclosure [Abstract]
Schedule of Future Minimum Lease Payments and Payments Due Under Non-cancelable Service Contracts	2019 $ 738,238 2020 742,956 2021 766,546 2022 771,278 2023 794,937 Thereafter 4,012,539 Total $ 7,826,495

Disaggregation of Revenue (Tabl

Disaggregation of Revenue (Tables)	12 Months Ended
	Dec. 31, 2018
Revenue from Contract with Customer [Abstract]
Disaggregation of Revenue	Year Ended December 31, 2018 2017 Revenue by Product: Mail + Product Revenue $ 390,806 $ 653,316 Marketing Automation Revenue 18,260,719 12,795,436 Total Revenue $ 18,651,525 $ 13,448,752 Revenue by Type: Upfront Fees $ 1,601,580 $ 1,100,167 Recurring Revenue 17,049,945 12,348,585 Total Revenue $ 18,651,525 $ 13,448,752

Summary of Significant Accoun_4

Summary of Significant Accounting Policies (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Accounting Policies [Abstract]
Accounts receivable	$ 208,037	$ 611,293
Unbilled receivables	740,425	554,603
Gross receivables	948,462	1,165,896
Allowance for doubtful accounts	(127,516)	(526,127)
Accounts receivable and unbilled receivables, net	$ 820,946	$ 639,959

Summary of Significant Accoun_5

Summary of Significant Accounting Policies (Details 1)	Dec. 31, 2018USD ($)
Accounting Policies [Abstract]
2,019	$ 26,585
2,020	27,885
2,021	29,247
2,022	30,677
2,023	7,759
Total	$ 122,153

Summary of Significant Accoun_6

Summary of Significant Accounting Policies (Details 2) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Property and equipment, gross	$ 1,943,451	$ 1,259,356
Less: Accumulated depreciation and amortization	(682,653)	(460,211)
Property and equipment, net	1,260,798	799,145
Leasehold Improvements [Member]
Property and equipment, gross	197,268	128,122
Furniture and Fixtures [Member]
Property and equipment, gross	611,171	355,033
Computer Equipment And Software [Member]
Property and equipment, gross	$ 1,135,012	$ 776,201

Summary of Significant Accoun_7

Summary of Significant Accounting Policies (Details 3)	12 Months Ended
	Dec. 31, 2018
Leasehold Improvements [Member]
Useful lives	5 years
Furniture and Fixtures [Member] | Minimum [Member]
Useful lives	3 years
Furniture and Fixtures [Member] | Maximum [Member]
Useful lives	5 years
Computer Equipment [Member]
Useful lives	3 years
Software [Member] | Minimum [Member]
Useful lives	3 years
Software [Member] | Maximum [Member]
Useful lives	5 years

Summary of Significant Accoun_8

Summary of Significant Accounting Policies (Details 4) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Sales and marketing expense	$ 10,092,691	$ 6,677,807
Total operating expenses	21,717,370	15,435,125
Operating loss	(8,864,114)	(6,983,118)
Loss before income taxes	(9,809,816)	(6,773,943)
Net loss	$ (9,478,822)	$ (4,669,835)
Basic net loss per share	$ (1.11)	$ (.56)
Diluted net loss per share	$ (1.11)	$ (0.56)
Other current assets	$ 1,184,217	$ 899,127
Other long-term assets	665,123	612,631
Total assets	24,007,276	21,682,123
Accumulated deficit	(17,352,706)	(7,873,883)
Historical Accounting Method
Sales and marketing expense	10,183,186	6,983,208
Total operating expenses	21,807,865	15,740,526
Operating loss	(8,954,609)	(7,288,519)
Loss before income taxes	(9,900,311)	(7,079,344)
Net loss	$ (9,569,317)	$ (4,975,236)
Basic net loss per share	$ (1.12)	$ (0.59)
Diluted net loss per share	$ (1.12)	$ (0.59)
Other current assets	$ 485,058	$ 267,924
Other long-term assets	54,954	25,000
Total assets	22,697,947	20,463,289
Accumulated deficit	(18,662,035)	(9,092,717)
Effect of Adoption of New ASU
Sales and marketing expense	(90,495)	(305,401)
Total operating expenses	(90,495)	(305,401)
Operating loss	90,495	305,401
Loss before income taxes	90,495	305,401
Net loss	$ 90,495	$ 305,401
Basic net loss per share	$ 0.01	$ 0.04
Diluted net loss per share	$ 0.01	$ 0.04
Other current assets	$ 699,159	$ 631,203
Other long-term assets	610,169	587,631
Total assets	1,309,329	1,218,834
Accumulated deficit	$ 1,309,329	$ 1,218,834

Summary of Significant Accoun_9

Summary of Significant Accounting Policies (Details Narrative)	12 Months Ended
	Dec. 31, 2018USD ($)Integer	Dec. 31, 2017USD ($)	Dec. 31, 2016USD ($)
Number of operating segment | Integer	1
Convertible notes embedded derivative	$ 214,350	$ 0
Change in fair value of embedded derivative features	(400,220)	0
Accounts receivable written off	494,000
Allowance for doubtful accounts receivable	127,516	526,127
Goodwill	8,866,413	8,872,898
Depreciation expense	432,233	280,106
Revenue from contracts with customers	18,700,000	13,500,000
Deferred revenue	250,656	279,818
Deferred revenue decrease	(29,162)	(340)
Deferred revenue contract liability	250,656	279,818
Accrued revenue contract asset balances	740,425	554,603	$ 439,559
Revenue billed that was included in accrued revenue	554,603	439,559
Accrued revenue not billed	740,425	554,603
Advertising and marketing expenses	5,700,000	3,200,000
Capitalized cost of obtaining a contract	1,309,329	1,218,833
Capitalized cost of obtaining a contract, current	699,159	631,203
Capitalized cost of obtaining a contract, noncurrent	610,170	587,630
Amortization of costs attributable to obtaining contracts	$ 758,014	$ 557,595
Minimum [Member]
Finite-lived intangible assets useful lives	5 years
Maximum [Member]
Finite-lived intangible assets useful lives	11 years

Credit Facility (Details Narrat

Credit Facility (Details Narrative) - Revolving Loan Agreement [Member]	12 Months Ended
	Dec. 31, 2018USD ($)
Line of credit	$ 2,500,000
Line of credit facility, expiration date	Mar. 31, 2020
Loan interest rate	5.25%
Percentage of secured pledge of capital stock	100.00%
Percentage of pledge of foreign subsidiaries stock	65.00%

Convertible Notes (Details)

Convertible Notes (Details)	12 Months Ended
	Dec. 31, 2018USD ($)
Debt Disclosure [Abstract]
Principal amount	$ 8,000,000
Accrued interest paid-in-kind	304,301
Unamortized debt issuance costs	(122,153)
Original embedded derivative conversion feature	160,278
Net carrying value	$ 8,342,426

Convertible Notes (Details 1)

Convertible Notes (Details 1)	12 Months Ended
	Dec. 31, 2018USD ($)
Debt Disclosure [Abstract]
Contractual interest paid-in-kind expense (non-cash)	$ 304,301
Amortization of debt issuance costs (non-cash)	19,504
Amortization of embedded derivative (non-cash)	(25,592)
Total interest expense	$ 298,213
Effective interest rate	4.90%

Goodwill and Other Intangible_3

Goodwill and Other Intangible Assets (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Gross carrying amount	$ 6,350,014	$ 8,346,332
Accumulated amortization	(4,484,014)	(6,020,332)
Net carrying value	1,866,000	2,326,000
Goodwill	8,866,413	8,872,898
Total intangible assets	10,732,413	11,198,898
Trade Names [Member]
Gross carrying amount	120,000	346,644
Accumulated amortization	(120,000)	(309,640)
Net carrying value	0	37,004
Technology [Member]
Gross carrying amount	2,130,000	3,834,023
Accumulated amortization	(954,000)	(2,404,023)
Net carrying value	1,176,000	1,430,000
Customer Relationships [Member]
Gross carrying amount	4,100,014	4,165,665
Accumulated amortization	(3,410,014)	(3,306,669)
Net carrying value	$ 690,000	$ 858,996

Goodwill and Other Intangible_4

Goodwill and Other Intangible Assets (Details 1) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
2,019	$ 381,000
2,020	332,000
2,021	280,000
2,022	228,000
2,023	180,000
Thereafter	465,000
Total	$ 1,866,000	$ 2,326,000

Goodwill and Other Intangible_5

Goodwill and Other Intangible Assets (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
Changes in foreign exchange rate increase/reduction to goodwill	$ 6,485	$ 27,504
Impairment loss	0	0
Amortization expense	$ 460,000	$ 527,468

Changes in Accumulated Other _3

Changes in Accumulated Other Comprehensive Income (Loss) (Details)	12 Months Ended
	Dec. 31, 2018USD ($)
Equity [Abstract]
Balance beginning	$ (480,762)
Other comprehensive income (loss) prior to reclassifications	0
Amounts reclassified from accumulated other comprehensive income	0
Tax effect	0
Net current period other comprehensive loss	249,709
Balance end	$ (231,053)

Net Loss Per Share (Details)

Net Loss Per Share (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Earnings Per Share [Abstract]
Net loss	$ (9,478,822)	$ (4,669,835)
Basic weighted average common shares outstanding	8,512,297	8,395,319
Add incremental shares for warrants	0	0
Add incremental shares for stock options	0	0
Add incremental shares for convertible notes	0	0
Diluted weighted average common shares outstanding	8,512,297	8,395,319
Basic net loss per share	$ (1.11)	$ (.56)
Diluted net loss per share	$ (1.11)	$ (0.56)

Net Loss Per Share (Details 1)

Net Loss Per Share (Details 1) - shares	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Warrants [Member]
Antidilutive securities	30,000	80,000
Stock Option [Member]
Antidilutive securities	1,654,522	1,069,330
Convertible Notes [Member]
Antidilutive securities	1,107,240	0

Income Taxes (Details)

Income Taxes (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Current Provision
Federal	$ (154,872)	$ (1,939,620)
State	32,028	73,301
Foreign	(40,018)	(243,406)
Current Income Tax Provision	(162,862)	(2,109,725)
Deferred Provision
Federal	(143,988)	(34,621)
State	(24,144)	7,257
Foreign	0	32,981
Deferred Income Tax Provision	(168,132)	5,617
Total Income Tax Provision	$ (330,994)	$ (2,104,108)

Income Taxes (Details 1)

Income Taxes (Details 1) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Federal statutory rates	$ (2,058,172)	$ (2,369,986)
State income taxes, net of federal benefit	(194,244)	(563,944)
Permanent differences	66,068	148,246
Rate change	0	672,562
Other	(69,968)	141,284
Credits	(147,727)	(141,256)
Foreign	(80,534)	381,364
Valuation Allowance	2,153,583	(372,378)
Effective rate from continuing operations	$ (330,994)	$ (2,104,108)
Federal statutory rates on continuing operations	21.00%	35.00%
State income taxes, net of federal benefit	2.00%	8.00%
Permanent differences	(1.00%)	(2.00%)
Rate change	0.00%	(10.00%)
Other	1.00%	(2.00%)
Credits	2.00%	2.00%
Foreign	1.00%	(6.00%)
Valuation Allowance	(22.00%)	5.00%
Effective rate from continuing operations	3.00%	31.00%

Income Taxes (Details 2)

Income Taxes (Details 2) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Accrual to cash	$ 0	$ 118,366
Stock-based compensation	226,476	193,620
Depreciation	(252,795)	(103,863)
Intangibles	662,042	701,956
Net operating loss carryforwards	3,630,772	1,110,387
Accruals & Reserves	75,685	0
Net deferred tax asset valuation allowance	(4,342,180)	(2,188,598)
Total net deferred tax liabilities	$ 0	$ (168,132)

Income Taxes (Details Narrative

Income Taxes (Details Narrative) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Incremental income tax benefits	$ 200,000	$ 100,000
Net operating loss carryforwards	9,282,866	0
Deferred tax valuation allowance	4,300,000	2,200,000
Foreign
Net operating loss carryforwards	3,203,562	2,530,855
State
Net operating loss carryforwards	$ 15,001,960	$ 9,242,148

Defined Contribution Retireme_2

Defined Contribution Retirement Plan (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Defined Contribution Retirement Plan
Defined contribution plan, maximum annual contributions employee, percent	100.00%
Defined contribution plan, employer matching contribution, percent of match	100.00%
Defined contribution plan, employer matching contribution, percent of employees' gross pay	3.00%
Defined contribution retirement plan, expenses	$ 246,461	$ 198,783

Stock-Based Compensation (Detai

Stock-Based Compensation (Details) - Stock Option [Member]	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Volatility, minimum	48.00%	48.00%
Volatility, maximum	49.00%	49.00%
Risk-free interest rate, minimum	2.34%	1.85%
Risk-free interest rate, maximum	3.11%	2.26%
Expected term	6 years 3 months	6 years 3 months

Stock-Based Compensation (Det_2

Stock-Based Compensation (Details 1)	12 Months Ended
	Dec. 31, 2018USD ($)$ / sharesshares
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Number of shares outstanding, beginning | shares	1,069,330
Number of shares granted | shares	898,100
Number of shares exercised | shares	(113,090)
Number of shares expired | shares	(35,481)
Number of shares forfeited | shares	(164,337)
Number of shares outstanding, ending | shares	1,654,522
Number of shares exercisable | shares	623,649
Weighted average exercise price outstanding, beginning | $ / shares	$ 5.11
Weighted average exercise price granted | $ / shares	7.74
Weighted average exercise price exercised | $ / shares	5.34
Weighted average exercise price expired | $ / shares	7.60
Weighted average exercise price forfeited | $ / shares	9.07
Weighted average exercise price outstanding, ending | $ / shares	6.07
Weighted average exercise price exercisable | $ / shares	$ 5.12
Weighted average remaining contractual life outstanding, beginning	7 years 9 months 18 days
Weighted average remaining contractual life outstanding, ending	8 years 2 months 12 days
Weighted average remaining contractual life exercisable	7 years
Aggregate intrinsic value, beginning | $	$ 90,007
Aggregate intrinsic value, ending | $	10,866,658
Aggregate intrinsic value, exercisable | $	$ 2,072,937

Stock-Based Compensation (Det_3

Stock-Based Compensation (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Weighted average grant date fair value of stock options granted	$ 7.74
Stock option expense	$ 801,655	$ 510,978
Unrecognized compensation cost	$ 2,485,163
Weighted average remaining vesting period	3 years 2 months 5 days
Aggregate intrinsic value	$ 607,220	$ 34,373
Number of shares issued to non-employee directors	23,302	60,011
Fair value of stock awards granted, vested and expensed	$ 178,022	$ 272,976

Warrants (Details)

Warrants (Details) - Warrants [Member]	12 Months Ended
	Dec. 31, 2018USD ($)$ / sharesshares
Number of Units Outstanding, Beginning of period | shares	80,000
Number of Units,Granted | shares	0
Number of Units, Exercised | shares	(50,000)
Number of Units, Cancelled | shares	0
Number of Units Outstanding, End of period | shares	30,000
Number of Units, Exercisable | shares	30,000
Weighted Average Exercise Price Outstanding, Beginning of period | $ / shares	$ 7.81
Weighted Average Exercise Price, Granted | $ / shares	.00
Weighted Average Exercise Price, Exercised | $ / shares	7.81
Weighted Average Exercise Price, Cancelled | $ / shares	.00
Weighted Average Exercise Price Outstanding, End of period | $ / shares	7.81
Weighted Average Exercise Price, Exercisable | $ / shares	$ 7.81
Weighted Average Remaining Contractual Term Outstanding, Beginning	2 years 1 month 6 days
Weighted Average Remaining Contractual Term Outstanding, Ending	1 year 1 month 6 days
Weighted Average Remaining Contractual Term, Exercisable	1 year 1 month 6 days
Intrinsic Value, Outstanding, Beginning | $	$ 33,660
Intrinsic Value, Outstanding, Ending | $	144,525
Intrinsic Value, Exercisable | $	$ 144,525

Warrants (Details Narrative)

Warrants (Details Narrative)	12 Months Ended
	Dec. 31, 2018USD ($)$ / sharesshares
Warrants and Rights Note Disclosure [Abstract]
Connection with financing transaction value | $	$ 11,500,000
Number of warrants issued to purchase of common stock | shares	80,000
Exercise price of warrants | $ / shares	$ 7.81
Warrant term	5 years
Warrant expiration date	Jan. 30, 2020
Remaining contractual life of warrants	1 year 1 month 6 days

Commitments and Contingencies_2

Commitments and Contingencies (Details)	Dec. 31, 2018USD ($)
Commitments and Contingencies Disclosure [Abstract]
2,019	$ 738,238
2,020	742,956
2,021	766,546
2,022	771,278
2,023	794,937
Thereafter	4,012,539
Total	$ 7,826,495

Disaggregation of Revenue (Deta

Disaggregation of Revenue (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Total Revenue	$ 18,651,525	$ 13,448,752
Upfront fees
Total Revenue	1,601,580	1,100,167
Recurring Revenue
Total Revenue	17,049,945	12,348,585
Mail + Product Revenue
Total Revenue	390,806	653,316
Marketing Automation Revenue
Total Revenue	$ 18,260,719	$ 12,795,436

Restructuring (Details Narrativ

Restructuring (Details Narrative)	12 Months Ended
	Dec. 31, 2018USD ($)
Restructuring and Related Activities [Abstract]
Restructuring expenses	$ 252,314