Purple Innovation (PRPL) 10-Q 15 May 18 2018 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2018	Apr. 30, 2018
Entity Registrant Name	Purple Innovation, Inc.
Entity Central Index Key	1,643,953
Trading Symbol	PRPL
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Period End Date	Mar. 31, 2018
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q1
Entity Filer Category	Accelerated Filer
Class A common stock
Entity Common Stock, Shares Outstanding		9,682,855
Class B common stock
Entity Common Stock, Shares Outstanding		44,071,318

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 26,843	$ 3,593	[1]
Accounts receivable, net	3,911	4,182	[1]
Inventories, net	26,579	13,345	[1]
Prepaid inventory	1,587	2,219	[1]
Other current assets	2,879	492	[1]
Total current assets	61,799	23,831	[1]
Property and equipment, net	16,127	13,464	[1]
Intangible assets, net	1,319	1,267	[1]
Other long-term assets	5	22	[1]
Total Assets	79,250	38,584	[1]
Current liabilities:
Accounts payable	19,790	21,131	[1]
Accrued sales returns	4,606	4,825	[1]
Accrued compensation	1,747	2,097	[1]
Customer prepayments	7,060	3,213	[1]
Accrued sales tax	7,311	8,466	[1]
Other accrued liabilities	2,973	1,451	[1]
Current portion of long-term obligations	30	29	[1]
Total current liabilities	43,517	41,212	[1]
Long-term debt	19,081	8,000	[1]
Other long-term liabilities and obligations, net of current portion	2,646	2,368	[1]
Total liabilities	65,244	51,580	[1]
Commitments and contingencies (Note 9)			[1]
Stockholders' equity:
Additional paid-in capital	3,256		[1]
Accumulated deficit	(1,428)		[1]
Total stockholders' equity	1,833		[1]
Noncontrolling interest	12,173		[1]
Member deficit		(12,996)	[1]
Total equity	14,006	(12,996)
Total Liabilities and Equity	79,250	38,584	[1]
Class A common stock
Stockholders' equity:
Common stock value	1		[1]
Total equity	1
Class B common stock
Stockholders' equity:
Common stock value	4		[1]
Total equity	$ 4
[1]	See Note 2,''-Correction of Immaterial Misstatements in Prior Period Financial Statement''.

Condensed Consolidated Balance3

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) shares in Thousands	Mar. 31, 2018$ / sharesshares
Class A common stock
Common stock, par value | $ / shares	$ 0.0001
Common stock, shares authorized	210,000
Common stock, shares issued	9,683
Common stock, shares outstanding	9,683
Class B common stock
Common stock, par value | $ / shares	$ 0.0001
Common stock, shares authorized	90,000
Common stock, shares issued	44,071
Common stock, shares outstanding	44,071

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Income Statement [Abstract]
Revenues, net	$ 60,980	$ 30,124
Cost of revenues	34,580	15,830
Gross profit	26,400	14,294
Operating expenses:
Marketing and sales	22,045	13,791
General and administrative	6,762	2,212
Research and development	511	277
Total operating expenses	29,318	16,280
Operating loss	(2,918)	(1,986)
Interest expense	702
Other income, net	(19)	(6)
Net loss	(3,601)	(1,980)
Net loss attributable to noncontrolling interest	(2,173)
Net loss attributable to Purple Innovation, Inc.	$ (1,428)	$ (1,980)
Net loss per common share-basic and diluted	$ (0.17)	$ (0.24)
Weighted average common shares outstanding-basic and diluted	8,389	8,389

Condensed Consolidated Stateme5

Condensed Consolidated Statements of Equity (Unaudited) - 3 months ended Mar. 31, 2018 - USD ($) shares in Thousands, $ in Thousands	Class A Common Stock	Class B Common Stock	Additional Paid in Capital	Accumulated Deficit	Total Common Stockholders' Equity	Noncontrolling Interest	Member Deficit	[1]	Total
Beginning balance at Dec. 31, 2017							$ (12,996)		$ (12,996)
Beginning balance, shares at Dec. 31, 2017
Net (loss) income				(1,428)	(1,428)	(6,497)	4,324		(3,601)
Effect of the Transaction:
Proceeds and shares issued in the Transaction	$ 1	$ 4	(1,435)		(1,430)	18,670	8,672		25,912
Proceeds and shares issued in the Transaction, shares	9,683	44,071
Assignment of founder shares and sponsor warrants			4,691		4,691				4,691
Ending balance at Mar. 31, 2018	$ 1	$ 4	$ 3,256	$ (1,428)	$ 1,833	$ 12,173			$ 14,006
Ending balance, shares at Mar. 31, 2018	9,683	44,071
[1]	See Note 2,''-Correction of Immaterial Misstatements in Prior Period Financial Statement''.

Condensed Consolidated Stateme6

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018		Mar. 31, 2017
Cash flows from operating activities:
Net loss	$ (3,601)		$ (1,980)
Adjustments to reconcile net loss to net cash from operating activities:
Depreciation and amortization	456		75
Amortization of debt issuance costs and discounts	154
Changes in operating assets and liabilities:
Decrease (increase) in accounts receivable	271		(743)
Increase in inventories	(13,234)		(4,030)
Increase in prepaid inventory and other assets	(1,753)		(2,311)
(Decrease) increase in accounts payable	(1,246)		5,088
(Decrease) increase in accrued sales returns	(219)		836
(Decrease) increase in accrued compensation	(350)		480
Increase in customer prepayments	3,847		3,728
Increase in other accrued liabilities	100		1,529
Net cash (used in) provided by operating activities	(15,575)		2,672
Cash flows from investing activities:
Purchase of property and equipment	(2,645)		(2,613)
Investment in intangible assets	(68)
Net cash used in investing activities	(2,713)		(2,613)
Cash flows from financing activities:
Proceeds from the Transaction	25,912
Proceeds from credit agreement	24,000
Payments on line of credit	(8,000)
Payments for debt issuance costs	(367)
Principal payments on capital lease obligations	(7)
Payments on related party notes payable			(300)
Net cash provided by (used in) financing activities	41,538		(300)
Net increase (decrease) in cash	23,250		(241)
Cash, beginning of the period	3,593	[1]	4,013
Cash, end of the period	26,843		3,772
Supplemental schedule of non-cash investing and financing activities:
Property and equipment included in accounts payable	95		94
Assignment of founder shares and sponsor warrants	4,691
Equipment acquired under build-to-suit service agreement	$ 553
[1]	See Note 2,''-Correction of Immaterial Misstatements in Prior Period Financial Statement''.

Organization

Organization	3 Months Ended
	Mar. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization	1. Organization Purple Innovation, Inc., collectively with its subsidiary (the “Company,” “Purple”), is a comfort technology company which designs and manufactures products to improve how people sleep, sit and stand. The Company designs and manufactures a range of comfort technology products, including mattresses, pillows and cushions, using its proprietary Hyper-Elastic Polymer® technology designed to improve comfort. The Company markets and sells its products through direct-to-consumer online channel, traditional wholesale partners and third-party online retailers. The Company was incorporated in Delaware on May 19, 2015 as a special purpose acquisition company under the name of Global Partnership Acquisition Corp (“GPAC”) for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination involving the Company and one or more businesses. On February 2, 2018, the Company consummated a transaction structured similar to a reverse recapitalization (the “Transaction”) pursuant to which the Company acquired a portion of the equity of Purple Innovation, LLC (“Purple LLC”). At the closing of the Transaction (the “Closing”), the Company became the sole managing member of Purple LLC, and GPAC was renamed Purple Innovation, Inc. (“Purple Inc”). As the sole managing member of Purple LLC, Purple Inc through its officers and directors is responsible for all operational and administrative decision making and control of all of the day-to-day business affairs of Purple LLC without the approval of any other member, unless specified in the amended operating agreement.

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2018
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The Company consists of Purple Inc and its consolidated subsidiary Purple LLC. Pursuant to the Transaction described in Note 3— Merger Transaction The Transaction was structured similar to a reverse recapitalization. The historical operations of Purple LLC are deemed to be those of the Company. Thus, the financial statements included in this report reflect (i) the historical operating results of Purple LLC prior to the Transaction; (ii) the combined results of the Company following the Transaction; (iii) the assets and liabilities of Purple LLC at their historical cost; and (iv) the Company’s equity and earnings per share for all periods presented. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. As such, these unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and accompanying notes included in the Company’s Current Report on Form 8-K/A filed March 15, 2018. The unaudited condensed consolidated financial statements were prepared on the same basis as the audited financial statements and, in the opinion of management, reflect all adjustments (all of which were considered of normal recurring nature) considered necessary to present fairly the Company’s financial results. The results of the three months ended March 31, 2018 are not necessarily indicative of the results to be expected for the fiscal year ending December 31, 2018 or for any other interim period or other future year. Variable Interest Entities Purple LLC is a variable interest entity (“VIE”). The Company determined that it is the primary beneficiary of Purple LLC as Purple Inc is the sole managing member and has the power to direct the activities most significant to Purple LLC’s economic performance as well as the obligation to absorb losses and receive benefits that are potentially significant. At March 31, 2018, Purple Inc had approximately 18% economic interest in Purple LLC and consolidated 100% of Purple LLC’s assets, liabilities and results of operations in the Company’s unaudited condensed consolidated financial statements contained herein. At March 31, 2018, InnoHold had approximately 82% of the economic interest in Purple LLC; however, InnoHold has disproportionally fewer voting rights, and is shown as the noncontrolling interest (“NCI”) holder of Purple LLC. For further discussion see Note 10— Equity, “ Noncontrolling Interest Use of Estimates The preparation of the unaudited condensed consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. The Company regularly makes significant estimates and assumptions including, but not limited to, estimates that affect the Company’s revenue recognition, accounts receivable and allowance for doubtful accounts, cost of revenues, sales returns, warranty liabilities, the recognition and measurement of loss contingencies and estimates of current and deferred income taxes, deferred income tax valuation allowances and amounts associated with the Company’s Tax Receivable Agreement with InnoHold (the “Tax Receivable Agreement”). Predicting future events is inherently an imprecise activity and, as such, requires the use of judgment. The Company bases its estimates on historical experience and on various other assumptions believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ materially from those estimates. Correction of Immaterial Misstatements in Prior Period Financial Statements In connection with the preparation of the unaudited condensed consolidated financial statements for the three months ended March 31, 2018, the Company identified an error as of December 31, 2017 that caused an overstatement of previously reported net inventory. The error primarily related to a process deficiency in the physical inventory count and reconciliation process that resulted in an overstatement of certain inventory items. The correction of this error reduces net inventory and increases cost of revenues by $2.5 million as of and for the year ended December 31, 2017. This error arose in the fourth quarter of 2017 and did not impact the other quarters in 2017. In accordance with Staff Accounting Bulletin (“SAB”) No. 99, Materiality, and SAB No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements, the Company evaluated the error and determined that the impact was not material to the results of operations or financial position for the year ended December 31, 2017. The Company has elected to revise the 2017 financial statements when they are subsequently issued and accordingly, the Company has corrected the balance sheet as of December 31, 2017 in this filing. The Company will correct the statement of operations for 2017 the next time those statements are filed. The impact to the balance sheet as of December 31, 2017 is as follows (in thousands): As of December 31, 2017 As Reported Adjustment As Revised Inventories, net $ 15,799 $ (2,454 ) $ 13,345 Total assets 41,038 (2,454 ) 38,584 Member deficit (10,452 ) (2,454 ) (12,996 ) Total liabilities and equity 41,038 (2,454 ) 38,584 Revenue Recognition The Company generates revenues from the sale of its products. Revenue is recognized when the following revenue recognition criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or the service has been provided; (3) the selling price is fixed or determinable; and (4) collection of the resulting receivable is reasonably assured. Revenue is reported net of estimated sales returns and discounts and excludes sales taxes. As a part of the Company’s normal course of business, sales taxes are collected from customers. Such taxes collected are remitted, in a timely manner, to the appropriate governmental tax authority on behalf of the customer. The Company’s policy is to present revenue and costs, net of sales taxes. With the exception of third-party “white glove” delivery, revenue generated from product sales is recognized when the inventory is shipped to the customer, which is when title passes to the customer. Revenue generated from sales through third-party “white glove” delivery and set up providers is recognized when the inventory is delivered to the customer and any required set up and removal services are complete. The Company does not normally charge additional amounts above list price to the customer for shipping and handling. Orders with an exceptionally high shipping cost may result in an additional charge to the customer with those amounts recorded as revenue under the same policy as product revenue. Shipping costs are recorded as a component of cost of revenues. Customer prepayments include cash amounts transacted with customers prior to product delivery. Income Taxes The Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than-not that the deferred tax assets will be realized. Deferred tax assets and liabilities are calculated by applying existing tax laws and the rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the year of the enacted rate change. The Company accounts for uncertainty in income taxes using a recognition and measurement threshold for tax positions taken or expected to be taken in a tax return, which are subject to examination by federal and state taxing authorities. The tax benefit from an uncertain tax position is recognized when it is more likely than not that the position will be sustained upon examination by taxing authorities based on technical merits of the position. The amount of the tax benefit recognized is the largest amount of the benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The effective tax rate and the tax basis of assets and liabilities reflect management’s estimates of the ultimate outcome of various tax uncertainties. The Company recognizes penalties and interest related to uncertain tax positions within the provision (benefit) for income taxes line in the accompanying consolidated statements of operations. Purple LLC, the Company’s accounting predecessor, is a limited liability company treated as a partnership for U.S. federal income tax purposes that is not subject to U.S. federal income tax. Net Income (Loss) Per Share The two-class method of computing net income (loss) per share is required for entities that have participating securities. The two-class method is an earnings allocation formula that determines net income (loss) per share for participating securities according to dividends declared (or accumulated) and participation rights in undistributed earnings. Our Class B Stock has no economic interest in the earnings of the Company, resulting in the two-class method not being applicable as of March 31, 2018 or in prior periods. Basic net income (loss) per common share is calculated by dividing net income available (loss attributable) to common shareholders by the weighted average number of shares of Class A Stock outstanding each period. Diluted net income (loss) per share adds to those shares the incremental shares that would have been outstanding assuming exchanges of the Company's outstanding Class B Stock and warrants for Class A Stock, and the vesting of unvested Class A Stock. An anti-dilutive impact is an increase in net income (loss) per share or a reduction in net loss per share resulting from the conversion, exercise or contingent issuance of certain securities. The Company uses the "if-converted" method to determine the potential dilutive effect of conversions of its outstanding Class B Stock, and the treasury stock method to determine the potential dilutive effect of its outstanding warrants exercisable for shares of Class A Stock and the vesting of unvested Class A Stock. Recent Accounting Pronouncements New Revenue Guidance In May 2014, in addition to several amendments issued during 2016, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers.” This pronouncement updated the accounting guidance related to revenue from contracts with customers, which supersedes nearly all existing revenue recognition guidance under U.S. GAAP. The core principle is that a company should recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. The standard defines a five-step process to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP. These updates are effective for public companies for annual periods beginning after December 15, 2017, including interim periods therein. The Company is allowed to use the private company adoption timelines, and therefore the standard is effective for the Company for its annual period beginning January 1, 2019, and interim periods within annual periods beginning January 1, 2020. The standard shall be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. The Company has not begun to evaluate the impact that the standard will have on the Company’s financial statements. New Lease Guidance In February 2016, the FASB issued ASU No. 2016-02, “Leases,” which updated the accounting guidance related to leases as part of a joint project with the International Accounting Standards Board (“IASB”) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. These updates are effective for public companies for annual periods beginning after December 15, 2018, including interim periods therein. The Company is allowed to use the private company adoption timelines, and therefore the standard is effective for the Company for its annual period beginning January 1, 2020, and interim periods within annual periods beginning January 1, 2021. The standard is to be applied utilizing a modified retrospective approach, with early adoption permitted. The Company is currently evaluating the potential impact this new standard may have on its financial statements. Other Recent Accounting Pronouncements In January 2017, the FASB issued ASU 2017-01, “Business Combinations: Clarifying the Definition of a Business.” The purpose of this ASU is to clarify the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The amendments affect all companies and other reporting organizations that must determine whether they have acquired or sold a business. These updates are effective for public companies for annual periods beginning after December 15, 2017, including interim periods therein. The Company is allowed to use the private company adoption timelines, and therefore the standard is effective for the Company for its annual period beginning January 1, 2019, and interim periods therein. The guidance in this standard is not expected to have a material impact on the financial statements. In June 2016, the FASB issued ASU No, 2016-13, “Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments.” These amendments require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. These updates are effective for public companies for annual periods beginning after December 15, 2019, including interim periods therein. The Company is allowed to use the private company adoption timelines, and therefore the standard is effective for the Company for its annual period beginning January 1, 2021, and interim periods within annual periods beginning January 1, 2022, with early adoption permitted. The Company is currently evaluating the potential impact this new standard may have on its financial statements. In March 2016, the FASB issued ASU No. 2016-09, “Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting,” which updated the accounting guidance related to stock compensation. This update simplifies the accounting for employee share-based payment transactions, including income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. These updates are effective for public companies for annual periods beginning after December 15, 2016, including interim periods therein. The Company is allowed to use the private company adoption timelines, and therefore the standard is effective for the Company for its annual period beginning January 1, 2018, and interim periods within annual periods beginning January 1, 2019, with early adoption permitted. The guidance in this standard will not have a material impact on the financial statements of the Company.

Merger Transaction

Merger Transaction	3 Months Ended
	Mar. 31, 2018
Business Combinations [Abstract]
Merger Transaction	3. Merger Transaction On February 2, 2018, upon consummation of the Transaction, Purple LLC merged with and into a wholly owned subsidiary of GPAC (PRPL Acquisition, LLC), with Purple LLC being the survivor in that merger pursuant to an Agreement and Plan of Merger (the “Merger Agreement”), by and among GPAC, PRPL Acquisition, LLC, a Delaware limited liability company and a wholly owned subsidiary of GPAC (“Merger Sub”), Purple LLC and InnoHold. In connection with the closing of the Transaction, the following occurred: - GPAC was renamed “Purple Innovation, Inc.” and the operating agreement of Purple LLC was amended so that, among other changes, the existing single class of common membership units was reclassified into two new classes of units, Class A membership units (the “Class A Units”) and Class B membership units (the “Class B Units”). - 9.7 million Class A Units were issued and are solely held by Purple Inc. They are voting common units entitled to share in the profits and losses of Purple LLC and receive distributions as declared by Purple LLC’s manager. The amended operating agreement appoints Purple Inc as the sole managing member of Purple LLC. As the sole managing member, Purple Inc operates and controls all of the business and affairs of Purple LLC. Accordingly, although Purple Inc has a minority economic interest in Purple LLC, Purple Inc has the sole voting interest in and control of the management and operations of Purple LLC. - 44.1 million Class B Units were issued and are solely held by InnoHold who has limited voting rights in Purple LLC and is entitled to share in the profits and losses of Purple LLC and to receive distributions as declared by Purple LLC’s manager. See Note 9— Commitments and Contingencies “—Indemnification Obligations - Purple Inc amended its articles of incorporation and renamed its existing common stock as Class A common stock (“Class A Stock”) and created a new class of stock named Class B common stock (“Class B Stock”) (refer to Note 10— Equity - Purple Inc issued 44.1 million shares of Class B Stock to InnoHold. - Purple LLC obtained approximately $25.9 million in cash for working capital needs.

Inventories

Inventories	3 Months Ended
	Mar. 31, 2018
Inventory Disclosure [Abstract]
Inventories	4. Inventories Inventories consisted of the following (in thousands): March 31, December 31, 2018 2017 (Revised) Raw materials $ 16,541 $ 10,829 Work-in-process 1,631 308 Finished goods 8,835 2,450 Inventory obsolescence reserve (428 ) (242 ) Inventories, net $ 26,579 $ 13,345

Property and Equipment

Property and Equipment	3 Months Ended
	Mar. 31, 2018
Property, Plant and Equipment [Abstract]
Property and Equipment	5. Property and Equipment Property and equipment consisted of the following (in thousands): March 31, December 31, 2018 2017 Equipment in progress $ 3,778 $ 3,670 Equipment 11,283 8,609 Equipment under capital lease 159 159 Furniture and fixtures 177 168 Computer equipment and software 539 469 Leasehold improvements 1,507 1,265 Total property and equipment 17,443 14,340 Accumulated depreciation (1,316 ) (876 ) Property and equipment, net $ 16,127 $ 13,464 The Company recorded depreciation and amortization related to property and equipment of $0.4 million and $0.1 million during the three months ended March 31, 2018 and 2017. Because the Company has made $0.5 million in prepayments for construction work related to utility improvements at its Tooele, Utah manufacturing and warehouse location, the Company has been deemed the accounting owner of the improvements during their construction, and has recorded a build-to-suit asset totaling $1.1 million in property and equipment and a related build-to-suit liability of $0.6 million in other accrued liabilities as of March 31, 2018. For additional information, see Note 9— Commitments and Contingencies —Service Agreement

Other Accrued Liabilities

Other Accrued Liabilities	3 Months Ended
	Mar. 31, 2018
Payables and Accruals [Abstract]
Other Accrued Liabilities	6. Other Accrued Liabilities Other accrued liabilities consisted of the following (in thousands): March 31, December 31, 2018 2017 Current portion of warranty accrual $ 664 $ 640 Website commissions 607 558 Accrued expenses 666 177 Build-to-suit service agreement liability 553 — Accrued interest 483 — Rent—related party — 76 Total other accrued liabilities $ 2,973 $ 1,451

Debt Obligations

Debt Obligations	3 Months Ended
	Mar. 31, 2018
Debt Disclosure [Abstract]
Debt Obligations	7. Debt Obligations Debt obligations consisted of the following at March 31, 2018 (in thousands): Principal Borrowings Unamortized Debt Issuance Costs Net Carrying Interest Maturity Coliseum credit agreement $ 25,000 $ (5,919 ) $ 19,081 12.0 % February 2023 Debt obligations consisted of the following at December 31, 2017 (in thousands): Principal Borrowings Unused Borrowing Interest Maturity Outstanding Capacity Rate Date Wells Fargo line of credit (1) $ 8,000 $ 2,000 4.6 % October 2019 (1) Revolving lines of credit are not presented net of unamortized debt issuance costs. Coliseum Credit Agreement On February 2, 2018, Purple LLC entered into a Credit Agreement (the “Credit Agreement”) with Coliseum Capital Partners, L.P. (“CCP”), Blackwell Partners LLC – Series A (“Blackwell”) and Coliseum Debt Fund, L.P. (together with CCP and Blackwell, the “Lenders”), pursuant to which the Lenders agreed to make a loan in an aggregate principal amount of $25.0 million (the “Loan”). The Loan was closed and funded in connection with the closing of the Transaction on February 2, 2018. As part of the Credit Agreement, the Sponsor agreed to assign to the Lenders an aggregate of 2.5 million warrants to purchase 1.3 million shares of its Class A Stock. The Loan bears interest at a fixed rate of 12.0% per annum and matures on February 2, 2023. Interest accrues and is payable on the last business day of each fiscal quarter during the term of the Loan. Any principal pre-payments in the first year are subject to a make-whole payment, while principal pre-payments in years two through four are subject to certain pre-payment penalties. In addition, Purple LLC may elect for interest in excess of 5.0% per annum to be capitalized and added to the principal amounts of the Loan. The Credit Agreement provides for certain remedies to the Lenders in the event of customary events of default. The Credit Agreement also provides for standard indemnification of the Lenders and contains representations, warranties and certain covenants. While any amounts are outstanding under the Credit Agreement, Purple LLC is subject to a number of affirmative and negative covenants, including covenants regarding dispositions of property, investments, business combinations or acquisitions, incurrence of additional indebtedness and transactions with affiliates, among other customary covenants. In particular, Purple LLC is restricted from (i) making capital expenditures in excess of $20.0 million in any fiscal year, (ii) incurring capital lease obligations in excess of $10.0 million and (iii) incurring asset-based loans in excess of $20.0 million, subject to limited exceptions. Purple LLC is also restricted from making distributions or other payments on its membership interest, subject to limited exceptions. The Company paid debt issuance costs, incurred an original issuance discount and discounts related to the Founder Shares and Sponsor Warrants that were assigned in conjunction with the Credit Agreement. The amount of these reductions collectively allocated to debt at the time of the Transaction was $6.1 million. The Credit Agreement is carried at cost. As the Credit Agreement was entered into on February 2, 2018, the carrying value approximates fair value. Wells Fargo Line of Credit In February 2018, the Company paid off and closed the line of credit with Wells Fargo by paying $8.1 million in cash including accrued interest and fees.

Related Party Transactions

Related Party Transactions	3 Months Ended
	Mar. 31, 2018
Related Party Transactions [Abstract]
Related-Party Transactions	8. Related Party Transactions The Company had various transactions with entities or individuals which are considered related parties. Coliseum Capital Management, LLC Immediately following the closing of the Transaction, Adam Gray, managing partner of Coliseum Capital Management, LLC (“Coliseum”), was appointed to the Company’s board of directors. CCP, one of the lenders under the Credit Agreement is a related party of Coliseum. See Note 7— Debt Obligations Purple Founder Entities TNT Holdings, LLC (“TNT”), EdiZONE, LLC (“EdiZONE”) and InnoHold (the “Purple Founder Entities”) were entities under common control with Purple LLC prior to the Transaction as TNT, EdiZONE and InnoHold are majority owned and controlled by Terry Pearce and Tony Pearce who also were the founders of Purple LLC and immediately following the Transaction were appointed to the Company’s board of directors (the “Purple Founders”). On February 10, 2017, Purple LLC entered into a Shared Services Agreement with the Founder Entities, effective January 1, 2017, pursuant to which Purple LLC and the Founder Entities agreed to provide certain operational and administrative support services. Pursuant to the Shared Services Agreement, Casey McGarvey, Purple’s Chief Legal Officer, and other employees of Purple provide services to EdiZONE, LLC. Mr. McGarvey also provides similar services to InnoHold, the controlling member of Purple Inc, and to TNT. In the three months ended March 31, 2018 and 2017, Purple did not pay to or receive from the Founder Entities any amounts under this agreement. TNT owns the Alpine facility Purple LLC leases. Effective as of October 31, 2017, Purple LLC entered into an Amended and Restated Lease Agreement with TNT. The Company determined that TNT is not a VIE as it and Purple LLC do not hold any explicit or implicit variable interest in TNT and does not have a controlling financial interest in TNT. The Company incurred $0.3 million and $0.2 million in rent expense to TNT for the building lease of the Alpine facility in the three months ended March 31, 2018 and 2017. On November 1, 2017, Purple and EdiZONE executed the Confidential Assignment and License Back Agreement, pursuant to which EdiZONE assigned substantially all of its intellectual property to Purple and Purple licensed back to EdiZONE such intellectual property for use outside the consumer comfort and cushioning field of use reserved by Purple. EdiZONE also agreed to notify Purple of any breach of a third-party license agreement relating to consumer comfort intellectual property or consumer comfort products and Purple reserved the right to enforce EdiZONE’s rights with respect to such violations, provided that Purple agreed to pay the costs of such enforcement and to indemnify EdiZONE for any losses arising therefrom. EdiZONE further agreed not to extend such third-party licenses or waive any such violations, or to settle any claim with respect thereto, without Purple’s consent. In addition, EdiZONE also agreed to not sell or transfer any of its assets or assign any intellectual property or licenses relating to certain consumer comfort products and related intellectual property without Purple’s consent. EdiZONE has agreed not to use any intellectual property in the consumer comfort or cushioning field of use, subject only to its existing third-party licenses. EdiZONE previously granted third party licenses in the consumer comfort and cushioning field of use, and the Confidential Assignment and License Back Agreement allows EdiZONE to maintain these existing license agreements. On March 14, 2018, Purple and EdiZONE further amended and restated the Confidential Assignment and License Back Agreement to correct some inconsistencies in the agreement. On February 2, 2018, in connection with the Closing, the Company entered into the Exchange Agreement with InnoHold, which provides for the exchange of Class B Units and of Class B Stock issued in connection with the Business Combination into shares of Class A Stock. The initial exchange ratio will be (i) one Class B Unit plus (ii) one share of Class B Stock for one share of Class A Stock, in each case subject to certain adjustments. On February 2, 2018, in connection with the Closing, the Company entered into the Tax Receivable Agreement with InnoHold. Pursuant to the Tax Receivable Agreement, the Company is required to pay InnoHold 80% of the amount of savings, if any, in U.S. federal, state and local income tax that the Company actually realizes (or is deemed to realize in the case of an early termination payment by the Company, or a change of control of the Company) as a result of the increases in tax basis and certain other tax benefits related to the payment of the Cash Consideration pursuant to the Merger Agreement and the exchange of the Class B Units (together with an equal number of shares of Class B Stock) for Class A Stock. The Company would retain the remaining 20% of cash savings, if any, realized. All payments of tax savings to InnoHold will be the Company’s obligation, and not that of Purple LLC. On February 2, 2018, in connection with the Closing, the Company entered into the Registration Rights Agreement with InnoHold and the Parent Representative. Under the Registration Rights Agreement, InnoHold holds registration rights that obligate the Company to register for resale under the Securities Act, all or any portion of the Equity Consideration (including Class A Stock issued in exchange for the Equity Consideration pursuant to the Exchange Agreement) (the “Registrable Securities”) so long as such shares are not then restricted under the Lock-Up Agreement. InnoHold is entitled to make a written demand for registration under the Securities Act of all or part of its Registrable Securities (up to a maximum of three demands in total), so long as such shares are not then restricted under the Lock-Up Agreement. Subject to certain exceptions, if any time after the Closing, the Company proposes to file a registration statement under the Securities Act with respect to its securities, under the Registration Rights Agreement, the Company shall give notice to InnoHold as to the proposed filing and offer InnoHold an opportunity to register the sale of such number of Registrable Securities as requested by InnoHold in writing. In addition, subject to certain exceptions, InnoHold is entitled under the Registration Rights Agreement to request in writing that the Company register the resale of any or all of its Registrable Securities on Form S-3 and any similar short-form registration that may be available at such time. On February 2, 2018, in connection with the Closing, InnoHold and Terry Pearce and Tony Pearce, who together own a majority of InnoHold (collectively with InnoHold, the “Sellers”), entered into the Non-Competition Agreement with the Company, Purple LLC and their respective successors, affiliates and subsidiaries (referred to as the “Covered Parties”). Pursuant to the Non-Competition Agreement, for a period from the Closing until three years thereafter (or if later, until the one year anniversary of the date on which the Sellers, their affiliates or any of their respective officers, directors or employees are no longer directors, officers, managers or employees of the Company (the “Termination Date”)), each Seller and its affiliates will not, without the Company’s prior written consent, directly or indirectly engage in (or own, manage, finance or control, or become engaged or serve as an officer, director, employee, member, partner, agent, consultant, advisor or representative of), an entity that engages in the business of (i) designing and manufacturing comfort technology products worldwide to improve how people sleep, sit, and stand, including mattresses, pillows, platform bases and cushions, and (ii) marketing, licensing and selling its products worldwide through direct-to-consumer, traditional retail channels and partnerships (collectively, the “Business”) anywhere in the world, subject to certain specified exceptions for existing relationships. However, the Covered Parties and their affiliates are permitted under the Non-Competition Agreement to own passive portfolio company investments of no more than 2% in a competitor of the Covered Parties, so long as the Sellers, their affiliates and their respective shareholders, directors, officer, managers and employees who were involved with the business of the Covered Parties are not involved in the management or control of such competitor. On February 2, 2018, in connection with the Closing, InnoHold entered into a lock-up agreement with the Company and the Parent Representative (“Lock-Up Agreement”) with respect to the equity securities of both the Company and Purple LLC received in the Business Combination (the “Restricted Securities”). Pursuant to the Lock-Up Agreement, InnoHold agreed that it will not, from the Closing until the earliest of (x) the one year anniversary of the Closing, (y) the date on which the last sale price of the Class A Stock (or any successor publicly traded common equity security) equals or exceeds $12.00 per share (as equitably adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the Closing or (z) the date on which the Company consummates a liquidation, merger, share exchange or other similar transaction with an unaffiliated third party that results in all of the Company’s stockholders having the right to exchange either equity holdings in the Company for cash, securities or other property: (i) lend, offer, pledge, hypothecate, encumber, donate, assign, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any of the Restricted Securities, (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any of its Restricted Securities, or (iii) publicly announce any intention to effect any transaction specified in clause (i) or (ii). However, InnoHold is allowed to transfer any of its Restricted Securities under certain limited exceptions, including to affiliates, to family members or to its equity holders, provided in each such case that the transferee thereof agrees to be bound by the restrictions set forth in the Lock-Up Agreement. InnoHold is also permitted to transfer the Restricted Securities pursuant to an underwritten public offering to which all of the parties to the Lock-Up Agreement shall have consented.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2018
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	9. Commitments and Contingencies Required Member Distributions Prior to the Transaction and pursuant to the then applicable First Amended and Restated Limited Liability Company Agreement (the “First Purple LLC Agreement”), Purple LLC was required to distribute to InnoHold an amount equal to 45 percent of Purple LLC’s net taxable income following the end of each fiscal year. The First Purple LLC Agreement was amended and replaced by the Second Amended and Restated Limited Liability Company Agreement (the “Second Purple LLC Agreement”) on February 2, 2018 as part of the Transaction. The Second Purple LLC Agreement does not include any mandatory distributions, other than tax distributions. No distributions have been made by Purple LLC under the First Purple LLC Agreement or the Second Purple LLC agreement during the three months ended March 31, 2018 and 2017. Service Agreement In October 2017, the Company entered into an electric service agreement with the local power company. The agreement provides for the construction and installation of certain utility improvements to provide increased power capacity to the manufacturing and warehouse facility in Tooele, Utah. The Company agreed to pay $0.5 million related to the improvements and agreed to a minimum contract billing amount over a 15-year period based on regulated rate schedules and changes in actual demand during the billing period. The agreement includes an early termination clause that requires the Company to pay a pro-rata termination charge if the Company terminates within the first 10-years of the service start date. The early termination charge and other key terms within the service agreement will not be known and finalized until after the utility improvements have been completed and service begins. As of March 31, 2018, the utility improvements remained under construction and were not yet operational. See Note 5— Property and Equipment. Operating Leases The Company leases various office and warehouse facilities under two non-cancelable operating leases. Building space for its headquarters facility in Alpine, Utah is leased from TNT, an entity that prior to the Transaction was under common control with Purple LLC. The Company also leases a facility located in Tooele, Utah for use primarily as manufacturing and warehouse space. At March 31, 2018 and December 31, 2017, deferred rent of $1.8 million and $1.9 million, respectively is included in other long-term liabilities on the accompanying balance sheets. The Company recognizes rent expense on a straight-line basis over the noncancelable lease term. During the three months ended March 31, 2018 and 2017, the Company recognized rent expense in the amount of $0.9 million and $0.7 million. Purchase Agreement In February 2018, the Company entered into a purchase contract with a supplier of mineral oil that includes a minimum purchase commitment over a two-year period. In exchange, the Company is offered a discount per gallon. The Company expects to pay approximately $14.4 million over the two-year period. As of March 31, 2018, the Company expects to fulfill its commitments under the agreement in the normal course of business, and as such, no liability has been recorded. Indemnification Obligations From time to time, the Company enters into contracts that contingently require it to indemnify parties against claims. These contracts primarily relate to provisions in the Company’s services agreements with related parties that may require the Company to indemnify the related parties against services rendered; and certain agreements with the Company’s officers and directors under which the Company may be required to indemnify such persons for liabilities. In connection with the closing of the Transaction, to secure the payment of a certain portion of specified post-closing indemnification rights of the Company under the Merger Agreement, 0.5 million shares of Class B Stock and 0.5 million Class B Units otherwise issuable to InnoHold as equity consideration have been deposited in an escrow account for up to three years from the Closing pursuant to a contingency escrow agreement. Rights of Securities Holders The holders of the certain Warrants exercisable into Class A Stock and certain other unregistered Class A Stock were entitled to registration rights pursuant to certain registration rights agreements of the Company as of the Transaction date. In March 2018, the Company filed a registration statement registering the Warrants (and any shares of Class A Stock issuable upon the exercise of the Warrants), and certain unregistered shares of Class A Common Stock. The registration statement was declared effective on April 3, 2018. Purple LLC Class B Unit Exchange Right. On February 2, 2018, in connection with the Closing, the Company entered into an exchange agreement with Purple LLC and InnoHold (the “Exchange Agreement”), which provides for the exchange of Purple LLC Class B Units (the “Class B Units”) and shares of Class B Stock (together with an equal number of Class B Units, the “Paired Securities”) for, at the Company’s option, either (A) shares of Class A Stock at an initial exchange ratio equal to one Paired Security for one share of Class A Stock or (B) a cash payment equal to the product of the average of the volume-weighted closing price of one share of Class A Stock for the ten trading days immediately prior to the date InnoHold delivers a notice of exchange multiplied by the number of Paired Securities being exchanged. Holders of Class B Units may elect to exchange all or any portion of their Class B Units (together with an equal number of shares of Class B Stock) as described above by delivering a notice to Purple LLC. However, the Class B Units (together with an equal number of shares of Class B Stock) may not be exchanged during a lock-up period ending on the earliest of (x) the one year anniversary of the Closing, (y) the date on which the last sale price of the Class A Stock (or any successor publicly traded common equity security) equals or exceeds $12.00 per share (as equitably adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the Closing or (z) the date on which the Company consummates a liquidation, merger, share exchange or other similar transaction with an unaffiliated third party that results in all of the Company’s stockholders having the right to exchange either equity holdings in the Company for cash, securities or other property. The exchange will occur automatically upon the occurrence of a change of control or sale of substantially all of the assets of the Company or Purple LLC. In certain cases, adjustments to the exchange ratio will occur in case of a split, reclassification, recapitalization, subdivision or similar transaction of or relating to the Class B Units or the shares of Class A Stock and Class B Stock or a transaction in which the Class A Stock is exchanged or converted into other securities or property. The exchange ratio will also adjust in certain circumstances when the Company acquires Class B Units other than through an exchange for its shares of Class A Stock. The right of a holder of Class B Units to exchange may be limited by the Company if it reasonably determines in good faith that such restrictions are required by applicable law (including securities laws), such exchange would not be permitted under other agreements of such holder with the Company or its subsidiaries, including the Operating Agreement, or if such exchange would cause Purple LLC to be treated as a “publicly traded partnership” under applicable tax laws. The Company and each holder of Class B Units shall bear its own expense regarding the exchange except that the Company shall be responsible for transfer taxes, stamp taxes and similar duties. Maintenance of One-to-One Ratios. The Second Purple LLC Agreement includes provisions intended to ensure that the Company at all times maintains a one-to-one ratio between (a) (i) the number of outstanding shares of Class A Stock and (ii) the number of Class A Units owned by the Company (subject to certain exceptions for certain rights to purchase equity securities of the Company under a “poison pill” or similar shareholder rights plan, if any, certain convertible or exchangeable securities issued under the Company’s equity compensation plan and certain equity securities issued pursuant to the Company’s equity compensation plan (other than a stock option plan) that are restricted or have not vested thereunder) and (b) (i) the number of other outstanding equity securities of the Company (including the warrants exercisable for shares of Class A Stock) and (ii) the number of corresponding outstanding equity securities of Purple LLC. These provisions are intended to result in InnoHold having a voting interest in the Company that is identical to InnoHold’s economic interest in Purple LLC. Legal Proceedings On January 9, 2018, Chris Knudsen filed a complaint against Purple LLC in the Fourth Judicial District Court of the State of Utah. Mr. Knudsen is a former consultant to Purple LLC. His contract with the company ended in March 2016. Mr. Knudsen alleges that Purple LLC orally agreed before the end of his consulting contract to appoint him as its chief executive officer beginning April 2016. Mr. Knudsen also contends that Purple LLC orally agreed to immediately issue him 4% of Purple LLC’s equity at the time of his appointment as chief executive officer. Mr. Knudsen alleges that Purple LLC breached these alleged oral agreements when it did not appoint him as chief executive officer on April 1, 2016 and did not provide any equity interests to him. Mr. Knudsen alleges that Purple LLC owes him a sum of $44 million for his purported equity stake in Purple LLC, plus interest, based on an initially announced $1.1 billion valuation. Mr. Knudsen also seeks declaratory relief that he owns the 4% equity position in Purple LLC. Purple LLC has responded to the complaint and denies that it reached an agreement with Mr. Knudsen for him to assume the role of chief executive officer, denies that it reached an agreement to provide equity to Mr. Knudsen, believes that this lawsuit is without merit and intends to vigorously contest it. The Company maintains insurance to defend against claims of this nature, which management believes is adequate to cover the cost of its defense of Mr. Knudsen’s claims. Purple LLC filed a lawsuit against Honest Reviews, LLC (“HMR”), Ryan Monahan (“Mr. Monahan”) and GhostBed, Inc. (“GhostBed”) (collectively, the “Defendants”), alleging that the Defendants are working together on a competitive campaign to intentionally disseminate false and misleading statements regarding the safety of the Company’s mattresses, while at the same time failing to disclose to the public the fact that Mr. Monahan has, since 2015, provided significant digital marketing services to GhostBed, for which his company received substantial compensation. The Defendants have published a number of articles and related materials claiming, without substantiation, that the non-toxic anti-tack powder used in connection with the Company’s products can cause respiratory distress, exacerbate asthma or other respiratory conditions, and cause cancer or even death. Defendants have widely published these materials, including on the HMR website, honestmattressreviews.com, and all of associated HMR social media pages. On September 22, 2017, the United States District Court in Utah issued a preliminary injunction requiring full disclosure of the relationship between GhostBed and Monahan on the HMR website and social media, the removal of certain prior articles and other content regarding the Company, the anti-tack powder, and the lawsuit from the HMR website and social media, and requiring that any future posts by the Defendants regarding the Company or the lawsuit be accompanied by a full disclosure of the relationship between Monahan and GhostBed. On February 12, 2018, the Court granted a motion for sanctions against the Defendants based on their untruthful and misleading statements in submissions to the Court and in their testimony at the preliminary injunction hearing. The sanctions included the dismissal of the counterclaims filed by GhostBed against Purple LLC and the award of attorneys’ fees and costs incurred by Purple LLC in connection with its second motion for preliminary injunction and its motion for sanctions. Despite the Court’s favorable rulings to date, Purple LLC is unable to determine, at this stage, the possible outcome of the litigation. The Company is from time to time involved in various other claims, legal proceedings and complaints arising in the ordinary course of business. The Company does not believe that adverse decisions in any such pending or threatened proceedings, or any amount that the Company might be required to pay by reason thereof, would have a material adverse effect on the financial condition or future results of the Company.

Stockholders_ Equity and Member

Stockholders’ Equity and Member Deficit	3 Months Ended
	Mar. 31, 2018
Equity [Abstract]
Stockholders’ Equity and Member Deficit	10. Stockholders’ Equity and Member Deficit Prior to the Transaction, GPAC was a shell company with no operations, formed as a vehicle to effect a business combination with one or more operating businesses. After the Closing, the Company became a holding company whose sole material asset consists of its interest in Purple LLC. Class A Common Stock The Company has 210.0 million shares of Class A Stock authorized at a par value of $0.0001 per share. Holders of the Company’s Class A Stock are entitled to one vote for each share held on all matters to be voted on by the stockholders and participate in dividends, if declared by the Board, or receive any portion of any such assets in respect of their shares upon liquidation, dissolution, distribution of assets or winding-up of the Company in excess of the par value of such stock. Holders of the Class A Stock and holders of the Class B Stock voting together as a single class, have the exclusive right to vote for the election of directors and on all other matters properly submitted to a vote of the stockholders. Holders of Class A Stock and Class B Stock are entitled to one vote per share on matters to be voted on by stockholders. In connection with the Transaction, all of GPAC’s issued and outstanding shares of common stock were renamed to Class A Stock. The Company distributed approximately $90.6 million of the cash proceeds from the Company’s initial public offering to redeem approximately 9.0 million shares of Class A Stock, which shares were then cancelled by GPAC. In addition, the Sponsor agreed to forfeit an aggregate of 1.3 million of the 3.9 million shares of common stock it received at GPAC’s formation (the “Founder Shares”), which forfeited shares were then cancelled by the Company. GPAC issued an additional 4.0 million shares of Class A Stock to investors as part of the PIPE financing. At March 31, 2018, 9.7 million shares of Class A Stock were outstanding. The Founder Shares are identical to the shares of Class A Stock sold in GPAC’s initial public offering, and holders of these shares have the same stockholder rights as public stockholders, except that the Founder Shares are subject to certain transfer and vesting restrictions described below. The Sponsor agreed not to transfer, assign or sell , except to certain permitted transferees, including to its members or in connection with a business combination, any of its Founder Shares until the earlier of (A) one year after the completion of the Transaction, or earlier if, subsequent to the Transaction, the last sale price of our Class A Stock equals or exceeds $12.00 per share (subject to adjustments for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the business combination or (B) the date on which the Company completes a liquidation, merger, stock exchange or other similar transaction after the business combination that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property. In accordance with the terms of the Transaction, the Sponsor agreed to subject 0.6 million shares of Class A Stock owned by it to vesting and forfeiture. The shares of Class A Stock subject to vesting will be forfeited eight years from the Closing, unless any of the following events (each a “Triggering Event”) occurs prior to that time:(i) the closing price of the Class A Stock on the principal exchange on which it is listed is at or above $12.50 for 20 trading days over a thirty trading day period (subject to certain adjustments), (ii) a change of control of the Company, (iii) a “going private” transaction by the Company pursuant to Rule 13e-3 under the Exchange Act or such other time as the Company ceases to be subject to the reporting obligations under Section 13 or 15(d) of the Exchange Act, or (iv) the time that the Company’s Class A Stock ceases to be listed on a national securities exchange. Such shares of Class A Stock will no longer be subject to forfeiture upon the occurrence of a Triggering event. In addition, in connection with the Coliseum Private Placement, the Sponsor assigned 1.3 million shares of Class A Stock subject to the same vesting and forfeiture conditions described above. Further, as of March 31, 2018, the Sponsor had distributed the remaining Founder Shares to its members. Such distributed Founder Shares remain subject to the vesting and forfeiture conditions described above. Class B Common Stock The Company has 90.0 million shares of Class B Stock authorized at a par value of $0.0001 per share. Holders of the Company’s Class B Stock will vote together as a single class with holders of the Company’s Class A Stock on all matters properly submitted to a vote of the stockholders. Shares of Class B Stock may be issued only to InnoHold, their respective successors and assigns, as well as any permitted transferees of InnoHold. A holder of Class B Stock may transfer shares of Class B Stock to any transferee (other than the Company) only if such holder also simultaneously transfers an equal number of such holder’s Purple LLC Class B units to such transferee in compliance with the LLC Agreement. Additionally, InnoHold agreed to restrictions on certain transfers of the Company’s securities which include, subject to certain exceptions, restrictions on the transfer of their common stock from the date of the Transaction until the earliest of (i) the one-year anniversary of the date of the Transaction, (ii) the date on which the last sale price of the Class A Stock equals or exceeds $12.00 per share for any 20 trading days within a 30-trading day period commencing at least 150 days after the date of the Transaction and (iii) the date on which the Company consummates a liquidation, merger share exchange or other similar transaction with an unaffiliated third party that results in all of the Company’s stockholders having the right to exchange equity holdings in the Company for cash, securities or other property. The Class B Stock is not entitled to receive dividends, if declared by the Board, or to receive any portion of any such assets in respect of their shares upon liquidation, dissolution, distribution of assets or winding-up of the Company in excess of the par value of such stock. In connection with the Transaction, approximately 44.1 million shares of Series B Stock were issued to InnoHold as part of the equity consideration. At March 31, 2018, 44.1 million shares of Class B Stock were outstanding. Warrants There were 15.5 million public warrants (the “Public Warrants”) issued in connection with GPAC’s IPO and 12.8 million warrants (the “Sponsor Warrants”), issued pursuant to a private placement simultaneously with the IPO. Each of the Company’s warrants entitles the registered holder to purchase one-half of one share of the Company’s Class A Stock at a price of $5.75 per half share ($11.50 per full share), subject to adjustment pursuant the terms of the warrant agreement. Pursuant to the warrant agreement, a warrant holder may exercise its warrants only for a whole number of shares of the Class A Stock. For example, if a warrant holder holds one warrant to purchase one-half of a share of Class A Stock, such warrant will not be exercisable. If a warrant holder holds two warrants, such warrants will be exercisable for one share of the Class A Stock. Warrants must be exercised for a whole share. In no event will the Company be required to net cash settle any warrant. The warrants have a five-year term which commenced on March 2, 2018, 30 days after the completion of the Transaction, and will expire on February 2, 2023, or earlier upon redemption or liquidation. The Company may call the warrants for redemption if the reported last sale price of the Class A Stock equals or exceeds $21.00 per share for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date the Company sends the notice of redemption to the warrant holders; provided, however, that the Sponsor Warrants are not redeemable by the Company so long as they are held by the Sponsor or its permitted transferees. In addition, with respect to the Sponsor Warrants, so long as such Sponsor Warrants are held by the Sponsor or its permitted transferee, the holder may elect to exercise the Sponsor Warrants on a cashless basis, by surrendering their Sponsor Warrants for that number of shares of Class A Stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A Stock underlying the Sponsor Warrants, multiplied by the difference between the exercise price of the Sponsor Warrants and the “fair market value” (defined below), by (y) the fair market value. The “fair market value” means the average reported last sale price of the Class A Stock for the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. All other terms, rights and obligations of the Sponsor Warrants remain the same as the Public Warrants. There were 12.8 million warrants, issued simultaneously with the IPO, pursuant to a private placement. The private placement warrants expire on the earlier to occur of: (i) 5 years after the date of the Transaction, or (ii) a redemption date if the stock trades over $24.00 for 20 trading days within a 30 day trading period while being exercisable and if there is an effective registration agreement. All other terms, rights and obligations remain the same as the warrants described above. From the time of GPAC’s IPO up to the Transaction with Purple LLC, GPAC had 28.3 million warrants outstanding. At March 31, 2018, 28.3 million warrants were outstanding. Preferred Stock The Company has 5.0 million shares of preferred stock authorized at a par value of $0.0001 per share. The preferred stock may be issued from time to time in one or more series. The directors are expressly authorized to provide for the issuance of shares of the preferred stock in one or more series and to establish from time to time the number of shares to be included in each such series and to fix the voting rights, designations and other special rights or restrictions. At March 31, 2018, there were no shares of preferred stock outstanding. Noncontrolling Interest NCI represents the membership interest held by holders other than the Company. On February 2, 2018, upon the close of the Transaction, InnoHold’s NCI percentage in Purple LLC was approximately 82%, The Company has consolidated the financial position and results of operations of Purple LLC and reflected the proportionate interest held by InnoHold as NCI.

Income Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2018
Income Tax Disclosure [Abstract]
Income Taxes	11. Income Taxes The Company’s sole material asset is Purple LLC, which is treated as a partnership for U.S. federal income tax purposes and for purposes of certain state and local income taxes. Purple LLC’s net taxable income and any related tax credits are passed through to its members and are included in the members’ tax returns, even though such net taxable income or tax credits may not have actually been distributed. While the Company consolidates Purple LLC for financial reporting purposes, the Company will be taxed on its share of future earnings of Purple LLC not attributed to the NCI holder, InnoHold, which will continue to bear its share of income tax on its allocable future earnings of Purple LLC. The income tax burden on the earnings taxed to the NCI is not reported by the Company in its condensed consolidated financial statements under GAAP. As a result, the Company’s effective tax rate is expected to differ materially from the statutory rate. As of March 31. 2018, the Company has a full valuation allowance on its net deferred tax assets. As of December 31. 2017, there was no deferred tax assets or valuations at Purple LLC. In assessing the realizability of deferred tax assets, including the deferred tax assets to be recorded in connection with the Transaction and generated under the Tax Receivable Agreement described below, management determined that it was more likely than not that its net deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible and consideration of tax-planning strategies. Considering these factors, a valuation allowance was recorded in the three months ended March 31, 2018. The Company currently estimates its annual effective income tax rate to be 0%. The effective tax rate for Purple Inc. differs from the federal rate of 21% primarily due to (1) a valuation allowance, (2) NCI in Purple LLC that is allocated to InnoHold and (3) various other items such as limitations on meals and entertainment, certain stock compensation and other costs. No current income tax liability is recorded as a result of the Transaction since its legal form is treated as a purchase of interests or assets in a non-taxable pass through partnership for U.S. federal income tax purposes such that the Company did not assume an existing tax obligation on the purchased assets. The Company expects that the excess of its tax basis in its investment in Purple LLC over its book carrying value in this investment will result in a deferred tax asset that may reduce certain income tax payments in the future. This deferred tax asset will encompass the basis increase in the assets of Purple LLC as a result of the Transaction and TRA as well as the Company’s share of Purple LLC’s unrecognized temporary timing differences between book and tax. The Company is still collecting the necessary information to quantify this net deferred tax asset for the outside basis difference. As noted above due to the uncertainty around the generation of future taxable income the Company will record a valuation allowance against the net deferred tax asset for this outside basis difference in the investment in Purple LLC. In connection with the Transaction the Company entered into a Tax Receivable Agreement (“TRA”) with the NCI holder, InnoHold, which provides for the payment by the Company to InnoHold of 80% of the net cash savings, if any, in U.S. federal, state and local income tax that the Company actually realizes (or is deemed to realize in certain circumstances) in periods after the closing of the Transaction as a result of (i) any tax basis increases in the assets of Purple LLC resulting from the distribution to InnoHold of the cash consideration, (ii) the tax basis increases in the assets of Purple LLC resulting from the redemption by Purple LLC or the exchange by the Company, as applicable, of Class B Paired Securities or cash, as applicable, and (iii) imputed interest deemed to be paid by the Company as a result of, and additional tax basis arising from, payments it makes under the TRA. As realization of the tax benefit related to the Transaction is not currently deemed probable, no liability under the TRA has been recognized in the accompanying condensed consolidated balance sheet. In the future, if and when InnoHold exercises its right to exchange or cause Purple LLC to redeem all or a portion of its Class B Units, a liability under the TRA may be recorded based on 80% of the estimated future cash tax savings that the Company may realize as a result of increases in the basis of the assets of Purple LLC attributed to the Company as a result of such exchange or redemption. The amount of the increase in asset basis, the related estimated cash tax savings and the attendant TRA liability to be recorded will depend on the price of the Company’s Class A Stock at the time of the relevant redemption or exchange. Due to the uncertainty surrounding the amount and timing of future redemptions of Class B Paired Securities by InnoHold and uncertainty about the ability of the Company to realize net cash savings, the Company does not believe it is appropriate to record a TRA liability related to future exchanges until such time that InnoHold exercises its right to cause Class B Paired Securities to be exchanged or converted into the Company’s Class A Stock or cash and the Company believes that the associated tax benefits are more-likely-than-not to result in net cash savings. The Company is treated as acquiring historical net deferred tax assets of GPAC of approximately $0.3 million in the Transaction. These deferred tax assets, including those to be recorded in connection with the Transaction, the TRA and for net operating loss carryforwards generated in 2018, are offset by a valuation allowance such that no net deferred tax assets are presently recorded on the financial statements, as the Company does not presently believe that the deferred tax assets are more likely than not realizable. The effects of uncertain tax positions are recognized in the condensed consolidated financial statements if these positions meet a “more-likely-than-not” threshold. For those uncertain tax positions that are recognized in the condensed consolidated financial statements, liabilities are established to reflect the portion of those positions it cannot conclude “more-likely-than-not” to be realized upon ultimate settlement. As of March 31, 2018. no uncertain tax positions were recognized as liabilities in the condensed consolidated financial statements.

Net Loss Per Common Share

Net Loss Per Common Share	3 Months Ended
	Mar. 31, 2018
Earnings Per Share [Abstract]
Net Loss Per Common Share	12. Net Loss Per Common Share The Transaction was structured similar to a reverse recapitalization by which the Company issued stock for the net assets of Purple LLC accompanied by a recapitalization. Earnings per share has been recast for all historical periods to reflect the Company’s capital structure of all comparative periods. The following table sets forth the calculation of basic and diluted weighted average shares outstanding and earnings per share for the periods presented (in thousands, except per share amounts): Three Months Ended March 31, 2018 2017 Numerator: Net loss attributable to Purple Innovation, Inc. $ (1,428 ) $ (1,980 ) Denominator: Weighted average shares—basic and diluted 8,389 8,389 Net loss per common share: Basic $ (0.17 ) $ (0.24 ) Diluted $ (0.17 ) $ (0.24 ) For the periods presented, the Company excluded 1.3 million shares of issued common stock subject to vesting and 14.2 million shares of common stock issuable upon conversion of the Company’s warrants as the effect was anti-dilutive.

Equity Compensation Plans

Equity Compensation Plans	3 Months Ended
	Mar. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Equity Compensation Plans	13. Equity Compensation Plans InnoHold Incentive Units The following table summarizes the total incentive unit activity granted by InnoHold and benefiting the Company for the three months ended March 31, 2018 (in thousands): Incentive Units Incentive units outstanding as of January 1, 2018 8,617 Cancelled (8,617 ) Granted 10 Exercised — Forfeited (3 ) Incentive units outstanding as of March 31, 2018 7 Incentive units vested at March 31, 2018 4 In January 2017 pursuant to the 2016 Equity Incentive Plan that authorized the issuance of 12.0 million incentive units, the Company granted 11.3 million incentive units to Purple Team, LLC, an entity for the benefit of certain employees, which vest over four years (with 25% vesting after the first year and the remaining monthly vesting thereafter for the following 36 months) from the later of the first of the month after their respective date of hire or January 1, 2016. These incentive units were non-voting and the unit holders only participate in potential liquidating distributions after a future majority sale of the Company. Incentive unit holders were only eligible to participate after the distribution threshold of approximately $135.0 million was met. The majority sale and $135.0 million threshold were considered performance conditions of the incentive units. As of December 31, 2017, the Company has not recorded any costs related to the incentive units, as the achievement of the performance conditions was not yet deemed probable. In conjunction with the closing of the Transaction, the incentive units were cancelled and new incentive units were issued by InnoHold under its own limited liability company agreement (the “InnoHold Agreement”), which is considered a modification for accounting purposes. Under the revised terms of the incentive units granted under the InnoHold Agreement, the holders are only eligible to participate in InnoHold’s distributions, if any, after the distribution threshold of approximately $135.0 million is met, which is considered a performance condition. Under the terms of the new incentive units, holders may participate in tax and discretionary distributions once the remaining threshold is met. As of March 31, 2018, the remaining threshold is approximately $96.2 million. As of March 31, 2018, the Company has not recorded any expenses related to the incentive units, as the achievement of the performance condition was not yet deemed probable. 2017 Equity Incentive Plan On April 10, 2018, the Company filed a Form S-8 to register 4.1 million shares of Class A Stock authorized for issuance under the Purple Innovation, Inc. 2017 Equity Incentive Plan (the “2017 Incentive Plan”). As of March 31, 2018 and 2017, no awards have been issued under the 2017 Incentive Plan.

Summary of Significant Accoun20

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2018
Accounting Policies [Abstract]
Basis of Presentation and Principles of Consolidation	Basis of Presentation and Principles of Consolidation The Company consists of Purple Inc and its consolidated subsidiary Purple LLC. Pursuant to the Transaction described in Note 3— Merger Transaction The Transaction was structured similar to a reverse recapitalization. The historical operations of Purple LLC are deemed to be those of the Company. Thus, the financial statements included in this report reflect (i) the historical operating results of Purple LLC prior to the Transaction; (ii) the combined results of the Company following the Transaction; (iii) the assets and liabilities of Purple LLC at their historical cost; and (iv) the Company’s equity and earnings per share for all periods presented. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. As such, these unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and accompanying notes included in the Company’s Current Report on Form 8-K/A filed March 15, 2018. The unaudited condensed consolidated financial statements were prepared on the same basis as the audited financial statements and, in the opinion of management, reflect all adjustments (all of which were considered of normal recurring nature) considered necessary to present fairly the Company’s financial results. The results of the three months ended March 31, 2018 are not necessarily indicative of the results to be expected for the fiscal year ending December 31, 2018 or for any other interim period or other future year.
Variable Interest Entities	Variable Interest Entities Purple LLC is a variable interest entity (“VIE”). The Company determined that it is the primary beneficiary of Purple LLC as Purple Inc is the sole managing member and has the power to direct the activities most significant to Purple LLC’s economic performance as well as the obligation to absorb losses and receive benefits that are potentially significant. At March 31, 2018, Purple Inc had approximately 18% economic interest in Purple LLC and consolidated 100% of Purple LLC’s assets, liabilities and results of operations in the Company’s unaudited condensed consolidated financial statements contained herein. At March 31, 2018, InnoHold had approximately 82% of the economic interest in Purple LLC; however, InnoHold has disproportionally fewer voting rights, and is shown as the noncontrolling interest (“NCI”) holder of Purple LLC. For further discussion see Note 10— Equity, “ Noncontrolling Interest
Use of Estimates	Use of Estimates The preparation of the unaudited condensed consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. The Company regularly makes significant estimates and assumptions including, but not limited to, estimates that affect the Company’s revenue recognition, accounts receivable and allowance for doubtful accounts, cost of revenues, sales returns, warranty liabilities, the recognition and measurement of loss contingencies and estimates of current and deferred income taxes, deferred income tax valuation allowances and amounts associated with the Company’s Tax Receivable Agreement with InnoHold (the “Tax Receivable Agreement”). Predicting future events is inherently an imprecise activity and, as such, requires the use of judgment. The Company bases its estimates on historical experience and on various other assumptions believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ materially from those estimates.
Correction of Immaterial Misstatements in Prior Period Financial Statements	Correction of Immaterial Misstatements in Prior Period Financial Statements In connection with the preparation of the unaudited condensed consolidated financial statements for the three months ended March 31, 2018, the Company identified an error as of December 31, 2017 that caused an overstatement of previously reported net inventory. The error primarily related to a process deficiency in the physical inventory count and reconciliation process that resulted in an overstatement of certain inventory items. The correction of this error reduces net inventory and increases cost of revenues by $2.5 million as of and for the year ended December 31, 2017. This error arose in the fourth quarter of 2017 and did not impact the other quarters in 2017. In accordance with Staff Accounting Bulletin (“SAB”) No. 99, Materiality, and SAB No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements, the Company evaluated the error and determined that the impact was not material to the results of operations or financial position for the year ended December 31, 2017. The Company has elected to revise the 2017 financial statements when they are subsequently issued and accordingly, the Company has corrected the balance sheet as of December 31, 2017 in this filing. The Company will correct the statement of operations for 2017 the next time those statements are filed. The impact to the balance sheet as of December 31, 2017 is as follows (in thousands): As of December 31, 2017 As Reported Adjustment As Revised Inventories, net $ 15,799 $ (2,454 ) $ 13,345 Total assets 41,038 (2,454 ) 38,584 Member deficit (10,452 ) (2,454 ) (12,996 ) Total liabilities and equity 41,038 (2,454 ) 38,584
Revenue Recognition	Revenue Recognition The Company generates revenues from the sale of its products. Revenue is recognized when the following revenue recognition criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or the service has been provided; (3) the selling price is fixed or determinable; and (4) collection of the resulting receivable is reasonably assured. Revenue is reported net of estimated sales returns and discounts and excludes sales taxes. As a part of the Company’s normal course of business, sales taxes are collected from customers. Such taxes collected are remitted, in a timely manner, to the appropriate governmental tax authority on behalf of the customer. The Company’s policy is to present revenue and costs, net of sales taxes. With the exception of third-party “white glove” delivery, revenue generated from product sales is recognized when the inventory is shipped to the customer, which is when title passes to the customer. Revenue generated from sales through third-party “white glove” delivery and set up providers is recognized when the inventory is delivered to the customer and any required set up and removal services are complete. The Company does not normally charge additional amounts above list price to the customer for shipping and handling. Orders with an exceptionally high shipping cost may result in an additional charge to the customer with those amounts recorded as revenue under the same policy as product revenue. Shipping costs are recorded as a component of cost of revenues. Customer prepayments include cash amounts transacted with customers prior to product delivery.
Income Taxes	Income Taxes The Company accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than-not that the deferred tax assets will be realized. Deferred tax assets and liabilities are calculated by applying existing tax laws and the rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the year of the enacted rate change. The Company accounts for uncertainty in income taxes using a recognition and measurement threshold for tax positions taken or expected to be taken in a tax return, which are subject to examination by federal and state taxing authorities. The tax benefit from an uncertain tax position is recognized when it is more likely than not that the position will be sustained upon examination by taxing authorities based on technical merits of the position. The amount of the tax benefit recognized is the largest amount of the benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The effective tax rate and the tax basis of assets and liabilities reflect management’s estimates of the ultimate outcome of various tax uncertainties. The Company recognizes penalties and interest related to uncertain tax positions within the provision (benefit) for income taxes line in the accompanying consolidated statements of operations. Purple LLC, the Company’s accounting predecessor, is a limited liability company treated as a partnership for U.S. federal income tax purposes that is not subject to U.S. federal income tax.
Net Income (Loss) Per Share	Net Income (Loss) Per Share The two-class method of computing net income (loss) per share is required for entities that have participating securities. The two-class method is an earnings allocation formula that determines net income (loss) per share for participating securities according to dividends declared (or accumulated) and participation rights in undistributed earnings. Our Class B Stock has no economic interest in the earnings of the Company, resulting in the two-class method not being applicable as of March 31, 2018 or in prior periods. Basic net income (loss) per common share is calculated by dividing net income available (loss attributable) to common shareholders by the weighted average number of shares of Class A Stock outstanding each period. Diluted net income (loss) per share adds to those shares the incremental shares that would have been outstanding assuming exchanges of the Company's outstanding Class B Stock and warrants for Class A Stock, and the vesting of unvested Class A Stock. An anti-dilutive impact is an increase in net income (loss) per share or a reduction in net loss per share resulting from the conversion, exercise or contingent issuance of certain securities. The Company uses the "if-converted" method to determine the potential dilutive effect of conversions of its outstanding Class B Stock, and the treasury stock method to determine the potential dilutive effect of its outstanding warrants exercisable for shares of Class A Stock and the vesting of unvested Class A Stock.
Recent Accounting Pronouncements	Recent Accounting Pronouncements New Revenue Guidance In May 2014, in addition to several amendments issued during 2016, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers.” This pronouncement updated the accounting guidance related to revenue from contracts with customers, which supersedes nearly all existing revenue recognition guidance under U.S. GAAP. The core principle is that a company should recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. The standard defines a five-step process to achieve this core principle and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing U.S. GAAP. These updates are effective for public companies for annual periods beginning after December 15, 2017, including interim periods therein. The Company is allowed to use the private company adoption timelines, and therefore the standard is effective for the Company for its annual period beginning January 1, 2019, and interim periods within annual periods beginning January 1, 2020. The standard shall be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. The Company has not begun to evaluate the impact that the standard will have on the Company’s financial statements. New Lease Guidance In February 2016, the FASB issued ASU No. 2016-02, “Leases,” which updated the accounting guidance related to leases as part of a joint project with the International Accounting Standards Board (“IASB”) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. These updates are effective for public companies for annual periods beginning after December 15, 2018, including interim periods therein. The Company is allowed to use the private company adoption timelines, and therefore the standard is effective for the Company for its annual period beginning January 1, 2020, and interim periods within annual periods beginning January 1, 2021. The standard is to be applied utilizing a modified retrospective approach, with early adoption permitted. The Company is currently evaluating the potential impact this new standard may have on its financial statements. Other Recent Accounting Pronouncements In January 2017, the FASB issued ASU 2017-01, “Business Combinations: Clarifying the Definition of a Business.” The purpose of this ASU is to clarify the definition of a business to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The amendments affect all companies and other reporting organizations that must determine whether they have acquired or sold a business. These updates are effective for public companies for annual periods beginning after December 15, 2017, including interim periods therein. The Company is allowed to use the private company adoption timelines, and therefore the standard is effective for the Company for its annual period beginning January 1, 2019, and interim periods therein. The guidance in this standard is not expected to have a material impact on the financial statements. In June 2016, the FASB issued ASU No, 2016-13, “Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments.” These amendments require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. These updates are effective for public companies for annual periods beginning after December 15, 2019, including interim periods therein. The Company is allowed to use the private company adoption timelines, and therefore the standard is effective for the Company for its annual period beginning January 1, 2021, and interim periods within annual periods beginning January 1, 2022, with early adoption permitted. The Company is currently evaluating the potential impact this new standard may have on its financial statements. In March 2016, the FASB issued ASU No. 2016-09, “Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting,” which updated the accounting guidance related to stock compensation. This update simplifies the accounting for employee share-based payment transactions, including income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. These updates are effective for public companies for annual periods beginning after December 15, 2016, including interim periods therein. The Company is allowed to use the private company adoption timelines, and therefore the standard is effective for the Company for its annual period beginning January 1, 2018, and interim periods within annual periods beginning January 1, 2019, with early adoption permitted. The guidance in this standard will not have a material impact on the financial statements of the Company.

Summary of Significant Accoun21

Summary of Significant Accounting Policies (Tables)	3 Months Ended
	Mar. 31, 2018
Accounting Policies [Abstract]
Schedule of correction of immaterial misstatements in prior period financial statements	As of December 31, 2017 As Reported Adjustment As Revised Inventories, net $ 15,799 $ (2,454 ) $ 13,345 Total assets 41,038 (2,454 ) 38,584 Member deficit (10,452 ) (2,454 ) (12,996 ) Total liabilities and equity 41,038 (2,454 ) 38,584

Inventories (Tables)

Inventories (Tables)	3 Months Ended
	Mar. 31, 2018
Inventory Disclosure [Abstract]
Schedule of inventories	March 31, December 31, 2018 2017 (Revised) Raw materials $ 16,541 $ 10,829 Work-in-process 1,631 308 Finished goods 8,835 2,450 Inventory obsolescence reserve (428 ) (242 ) Inventories, net $ 26,579 $ 13,345

Property and Equipment (Tables)

Property and Equipment (Tables)	3 Months Ended
	Mar. 31, 2018
Property, Plant and Equipment [Abstract]
Schedule of property and equipment	March 31, December 31, 2018 2017 Equipment in progress $ 3,778 $ 3,670 Equipment 11,283 8,609 Equipment under capital lease 159 159 Furniture and fixtures 177 168 Computer equipment and software 539 469 Leasehold improvements 1,507 1,265 Total property and equipment 17,443 14,340 Accumulated depreciation (1,316 ) (876 ) Property and equipment, net $ 16,127 $ 13,464

Other Accrued Liabilities (Tabl

Other Accrued Liabilities (Tables)	3 Months Ended
	Mar. 31, 2018
Payables and Accruals [Abstract]
Schedule of other accrued expenses	March 31, December 31, 2018 2017 Current portion of warranty accrual $ 664 $ 640 Website commissions 607 558 Accrued expenses 666 177 Build-to-suit service agreement liability 553 — Accrued interest 483 — Rent—related party — 76 Total other accrued liabilities $ 2,973 $ 1,451

Debt Obligations (Tables)

Debt Obligations (Tables)	3 Months Ended
	Mar. 31, 2018
Debt Disclosure [Abstract]
Schedule of debt obligations	Debt obligations consisted of the following at March 31, 2018 (in thousands): Principal Borrowings Unamortized Debt Issuance Costs Net Carrying Interest Maturity Coliseum credit agreement $ 25,000 $ (5,919 ) $ 19,081 12.0 % February 2023 Debt obligations consisted of the following at December 31, 2017 (in thousands): Principal Borrowings Unused Borrowing Interest Maturity Outstanding Capacity Rate Date Wells Fargo line of credit (1) $ 8,000 $ 2,000 4.6 % October 2019 (1) Revolving lines of credit are not presented net of unamortized debt issuance costs.

Net Loss Per Common Share (Tabl

Net Loss Per Common Share (Tables)	3 Months Ended
	Mar. 31, 2018
Earnings Per Share [Abstract]
Schedule of basic and diluted weighted average shares outstanding and earnings per share	Three Months Ended March 31, 2018 2017 Numerator: Net loss attributable to Purple Innovation, Inc. $ (1,428 ) $ (1,980 ) Denominator: Weighted average shares—basic and diluted 8,389 8,389 Net loss per common share: Basic $ (0.17 ) $ (0.24 ) Diluted $ (0.17 ) $ (0.24 )

Equity Compensation Plans (Tabl

Equity Compensation Plans (Tables)	3 Months Ended
	Mar. 31, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Schedule of incentive unit activity	Incentive Units Incentive units outstanding as of January 1, 2018 8,617 Cancelled (8,617 ) Granted 10 Exercised — Forfeited (3 ) Incentive units outstanding as of March 31, 2018 7 Incentive units vested at March 31, 2018 4

Summary of Significant Accoun28

Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Inventories, net	$ 26,579	$ 13,345	[1]
Total assets	79,250	38,584	[1]
Member deficit		(12,996)	[1]
Total liabilities and equity	$ 79,250	38,584	[1]
As Reported [Member]
Inventories, net		15,799
Total assets		41,038
Member deficit		(10,452)
Total liabilities and equity		41,038
Adjustment [Member]
Inventories, net		(2,454)
Total assets		(2,454)
Member deficit		(2,454)
Total liabilities and equity		$ (2,454)
[1]	See Note 2,''-Correction of Immaterial Misstatements in Prior Period Financial Statement''.

Summary of Significant Accoun29

Summary of Significant Accounting Policies (Details Textual) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Summary of Significant Accounting Policies (Textual)
Description of variable interest entity	Purple Inc had approximately 18% economic interest in Purple LLC and consolidated 100% of Purple LLC’s assets, liabilities and results of operations in the Company’s unaudited condensed consolidated financial statements contained herein. At March 31, 2018, InnoHold had approximately 82% of the economic interest in Purple LLC; however, InnoHold has disproportionally fewer voting rights, and is shown as the noncontrolling interest (“NCI”) holder of Purple LLC.
Cost of revenues	$ 34,580	$ 15,830	$ 2,500
Business acquisition, description	Purple Inc acquired approximately 18% of the common units of Purple LLC, while InnoHold, LLC (“InnoHold”) retained approximately 82% of the common units in Purple LLC.

Merger Transaction (Details)

Merger Transaction (Details) $ in Thousands	Feb. 02, 2018USD ($)shares
Merger Transaction (Textual)
Cash for working capital | $	$ 25,900
Common Class A [Member]
Merger Transaction (Textual)
Number of shares issued to stockholders	9,700,000
Common Class B [Member]
Merger Transaction (Textual)
Number of shares issued to stockholders	44,100,000

Inventories (Details)

Inventories (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Inventory Disclosure [Abstract]
Raw materials	$ 16,541	$ 10,829
Work-in-process	1,631	308
Finished goods	8,835	2,450
Inventory obsolescence reserve	(428)	(242)
Inventories, net	$ 26,579	$ 13,345	[1]
[1]	See Note 2,''-Correction of Immaterial Misstatements in Prior Period Financial Statement''.

Property and Equipment (Details

Property and Equipment (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Abstract]
Equipment in progress	$ 3,778	$ 3,670
Equipment	11,283	8,609
Equipment under capital lease	159	159
Furniture and fixtures	177	168
Computer equipment and software	539	469
Leasehold improvements	1,507	1,265
Total property and equipment	17,443	14,340
Accumulated depreciation	(1,316)	(876)
Property and equipment, net	$ 16,127	$ 13,464	[1]
[1]	See Note 2,''-Correction of Immaterial Misstatements in Prior Period Financial Statement''.

Property and Equipment (Detai33

Property and Equipment (Details Textual) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Property and Equipment (Textual)
Depreciation and amortization related to property and equipment	$ 400	$ 100
Prepayments for construction work	500
Build-to-suit asset property and equipment	1,100
Build-to-suit liability other accrued liabilities	$ 600

Other Accrued Liabilities (Deta

Other Accrued Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Payables and Accruals [Abstract]
Current portion of warranty accrual	$ 664	$ 640
Website commissions	607	558
Accrued expenses	666	177
Build-to-suit service agreement liability	553
Accrued interest	483
Rent - related party		76
Total other accrued liabilities	$ 2,973	$ 1,451	[1]
[1]	See Note 2,''-Correction of Immaterial Misstatements in Prior Period Financial Statement''.

Debt Obligations (Details)

Debt Obligations (Details) - USD ($) $ in Thousands		3 Months Ended	12 Months Ended
		Mar. 31, 2018	Dec. 31, 2017
Wells Fargo line of credit [Member]
Principal Borrowings Outstanding	[1]		$ 8,000
Unused Borrowing Capacity	[1]		$ 2,000
Interest Rate	[1]		4.60%
Maturity Date	[1]		October 2,019
Coliseum credit agreement [Member]
Principal Borrowings Outstanding		$ 25,000
Unamortized Debt Issuance Costs and Discounts		(5,919)
Net Carrying Value		$ 19,081
Interest Rate		12.00%
Maturity Date		February 2,023
[1]	Revolving lines of credit are not presented net of unamortized debt issuance costs.

Debt Obligations (Details Textu

Debt Obligations (Details Textual) - USD ($) $ in Thousands	Feb. 02, 2018	Feb. 28, 2018
Debt Obligations (Textual)
Credit agreement, description	Purple LLC entered into a Credit Agreement (the “Credit Agreement”) with Coliseum Capital Partners, L.P. (“CCP”), Blackwell Partners LLC – Series A (“Blackwell”) and Coliseum Debt Fund, L.P. (together with CCP and Blackwell, the “Lenders”), pursuant to which the Lenders agreed to make a loan in an aggregate principal amount of $25.0 million (the “Loan”). The Loan was closed and funded in connection with the closing of the Transaction on February 2, 2018. As part of the Credit Agreement, the Sponsor agreed to assign to the Lenders an aggregate of 2.5 million warrants to purchase 1.3 million shares of its Class A Stock. The Loan bears interest at a fixed rate of 12.0% per annum and matures on February 2, 2023. Interest accrues and is payable on the last business day of each fiscal quarter during the term of the Loan. Any principal pre-payments in the first year are subject to a make-whole payment, while principal pre-payments in years two through four are subject to certain pre-payment penalties. In addition, Purple LLC may elect for interest in excess of 5.0% per annum to be capitalized and added to the principal amounts of the Loan.
Leases description	Purple LLC is restricted from (i) making capital expenditures in excess of $20.0 million in any fiscal year, (ii) incurring capital lease obligations in excess of $10.0 million and (iii) incurring asset-based loans in excess of $20.0 million, subject to limited exceptions.
Debt transaction amount	$ 6,100
Wells Fargo line of credit [Member]
Debt Obligations (Textual)
Accrued interest and fees		$ 8,100

Related Party Transactions (Det

Related Party Transactions (Details) - USD ($)	Feb. 02, 2018	Feb. 02, 2018	Mar. 31, 2018	Mar. 31, 2017
Related Party Transactions (Textual)
Rent expense			$ 900,000	$ 700,000
Agreement description	The Closing, (y) the date on which the last sale price of the Class A Stock (or any successor publicly traded common equity security) equals or exceeds $12.00 per share (as equitably adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the Closing
TNT [Member]
Related Party Transactions (Textual)
Rent expense			$ 300,000	$ 200,000
InnoHold [Member]
Related Party Transactions (Textual)
Agreement description		The Company is required to pay InnoHold 80% of the amount of savings, if any, in U.S. federal, state and local income tax that the Company actually realizes (or is deemed to realize in the case of an early termination payment by the Company, or a change of control of the Company) as a result of the increases in tax basis and certain other tax benefits related to the payment of the Cash Consideration pursuant to the Merger Agreement and the exchange of the Class B Units (together with an equal number of shares of Class B Stock) for Class A Stock. The Company would retain the remaining 20% of cash savings

Commitments and Contingencies (

Commitments and Contingencies (Details) - USD ($) $ in Thousands	Feb. 02, 2018	Jan. 09, 2018	Feb. 28, 2018	Feb. 02, 2018	Oct. 31, 2017	Apr. 30, 2017	Mar. 31, 2018	Mar. 31, 2017	Apr. 09, 2018	Dec. 31, 2017
Commitments and Contingencies (Textual)
Required member distributions, percentage						45.00%
Service agreement, description					The Company agreed to pay $0.5 million related to the improvements and agreed to a minimum contract billing amount over a 15-year period based on regulated rate schedules and changes in actual demand during the billing period. The agreement includes an early termination clause that requires the Company to pay a pro-rata termination charge if the Company terminates within the first 10-years of the service start date.
Deferred rent included in long term liabilities							$ 1,800			$ 1,900
Recognized rent expense							$ 900	$ 700
Equity method investment ownership percentage									4.00%
Legal proceedings, description		Purple LLC owes him a sum of $44 million for his purported equity stake in Purple LLC, plus interest, based on an initially announced $1.1 billion valuation. Mr. Knudsen also seeks declaratory relief that he owns the 4% equity position in Purple LLC.
Indemnification obligations, description							From time to time, the Company enters into contracts that contingently require it to indemnify parties against claims. These contracts primarily relate to provisions in the Company’s services agreements with related parties that may require the Company to indemnify the related parties against services rendered; and certain agreements with the Company’s officers and directors under which the Company may be required to indemnify such persons for liabilities. In connection with the closing of the Transaction, to secure the payment of a certain portion of specified post-closing indemnification rights of the Company under the Merger Agreement, 0.5 million shares of Class B Stock and 0.5 million Class B Units otherwise issuable to InnoHold as equity consideration have been deposited in an escrow account for up to three years from the Closing pursuant to a contingency escrow agreement.
Purchase agreement, description			The Company expects to pay approximately $14.4 million over the two-year period.
Agreement description	The Closing, (y) the date on which the last sale price of the Class A Stock (or any successor publicly traded common equity security) equals or exceeds $12.00 per share (as equitably adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the Closing
InnoHold [Member]
Commitments and Contingencies (Textual)
Agreement description				The Company is required to pay InnoHold 80% of the amount of savings, if any, in U.S. federal, state and local income tax that the Company actually realizes (or is deemed to realize in the case of an early termination payment by the Company, or a change of control of the Company) as a result of the increases in tax basis and certain other tax benefits related to the payment of the Cash Consideration pursuant to the Merger Agreement and the exchange of the Class B Units (together with an equal number of shares of Class B Stock) for Class A Stock. The Company would retain the remaining 20% of cash savings

Stockholders_ Equity and Memb39

Stockholders’ Equity and Member Deficit (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2018	Feb. 02, 2018
Stockholders’ Equity and Member Deficit (Textual)
Sale of stock price per share	$ 5.75
Warrants term	5 years
Warrants expiration date, description	The warrants have a five-year term which commenced on March 2, 2018, 30 days after the completion of the Transaction, and will expire on February 2, 2023, or earlier upon redemption or liquidation. The Company may call the warrants for redemption if the reported last sale price of the Class A Stock equals or exceeds $21.00 per share for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date the Company sends the notice of redemption to the warrant holders.
Warrants outstanding	28,300
Percentage of noncontrolling interest		82.00%
Sponsor agreed to forfeit shares	3,900
Description of common stocks	(A) one year after the completion of the Transaction, or earlier if, subsequent to the Transaction, the last sale price of our Class A Stock equals or exceeds $12.00 per share (subject to adjustments for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the business combination or (B) the date on which the Company completes a liquidation, merger, stock exchange or other similar transaction after the business combination that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property.
Warrants issued	15,500
Description of warrants	The private placement warrants expire on the earlier to occur of: (i) 5 years after the date of the Transaction, or (ii) a redemption date if the stock trades over $24.00 for 20 trading days within a 30 day trading period while being exercisable and if there is an effective registration agreement. All other terms, rights and obligations remain the same as the warrants described above.
Preferred stock authorized	5,000
Preferred stock par value	$ 0.0001
Initial public offering redeem	3,900
GPAC [Member]
Stockholders’ Equity and Member Deficit (Textual)
Warrants outstanding	28,300
Warrants issued	12,800
Class A Common Stock
Stockholders’ Equity and Member Deficit (Textual)
Cancellation of common shares	9,000
Warrants to purchase of common stock price per share	$ 11.50
Warrants for redemption price per share	$ 21
Common stock authorized	210,000
Common stock, par value	$ 0.0001
Common stock issued	9,683
Common stock, shares outstanding	9,683
Description of common stocks	The shares of Class A Stock subject to vesting will be forfeited eight years from the Closing, unless any of the following events (each a “Triggering Event”) occurs prior to that time:(i) the closing price of the Class A Stock on the principal exchange on which it is listed is at or above $12.50 for 20 trading days over a thirty trading day period (subject to certain adjustments), (ii) a change of control of the Company, (iii) a “going private” transaction by the Company pursuant to Rule 13e-3 under the Exchange Act or such other time as the Company ceases to be subject to the reporting obligations under Section 13 or 15(d) of the Exchange Act, or (iv) the time that the Company’s Class A Stock ceases to be listed on a national securities exchange. Such shares of Class A Stock will no longer be subject to forfeiture upon the occurrence of a Triggering event. In addition, in connection with the Coliseum Private Placement, the Sponsor assigned 1.3 million shares of Class A Stock subject to the same vesting and forfeiture.
Shares issued	600
Class A Common Stock | Investors [Member]
Stockholders’ Equity and Member Deficit (Textual)
Common stock issued	4,000
Class A Common Stock | Initial public offering [Member]
Stockholders’ Equity and Member Deficit (Textual)
Cash proceeds	$ 90,600
Sponsor agreed to forfeit shares	1,300
Common Class B [Member]
Stockholders’ Equity and Member Deficit (Textual)
Common stock authorized	90,000
Common stock, par value	$ 0.0001
Common stock issued	44,071
Common stock, shares outstanding	44,071
Description of common stocks	(i) the one-year anniversary of the date of the Transaction, and (ii) the date on which the last sale price of the Class A Stock equals or exceeds $12.00 per share for any 20 trading days within a 30-trading day period commencing at least 150 days after the date of the Transaction.

Income Taxes (Details)

Income Taxes (Details)	3 Months Ended
	Mar. 31, 2018USD ($)
Income Tax Disclosure [Abstract]
Effective income tax rate	0.00%
Description of tax receivable agreement	The Transaction as a result of (i) any tax basis increases in the assets of Purple LLC resulting from the distribution to InnoHold of the cash consideration, (ii) the tax basis increases in the assets of Purple LLC resulting from the redemption by Purple LLC or the exchange by the Company, as applicable, of Class B Paired Securities or cash, as applicable, and (iii) imputed interest deemed to be paid by the Company as a result of, and additional tax basis arising from, payments it makes under the TRA.
Tax receivable agreement percentage	80.00%
Net deferred tax assets	$ 300,000
Tax rate, percentage	21.00%

Net Loss Per Common Share (Deta

Net Loss Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Numerator:
Net loss attributable to Purple Innovation, Inc.	$ (1,428)	$ (1,980)
Denominator:
Weighted average shares—basic and diluted	8,389	8,389
Net loss per common share:
Basic	$ (0.17)	$ (0.24)
Diluted	$ (0.17)	$ (0.24)

Net Loss Per Common Share (De42

Net Loss Per Common Share (Details Textual)	3 Months Ended
	Mar. 31, 2018shares
Net Loss Per Common Share (Textual)
Excluded shares of issued common stock subject to vesting	1,300,000
Shares of common stock issuable upon conversion of warrants	14,200,000

Equity Compensation Plans (Deta

Equity Compensation Plans (Details)	3 Months Ended
	Mar. 31, 2018shares
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Incentive units outstanding as of January 1, 2018	8,617,000
Cancelled	(8,617,000)
Granted	10,000
Exercised
Forfeited	(3,000)
Incentive units outstanding as of March 31, 2018	7,000
Incentive units vested at March 31, 2018	4,000

Equity Compensation Plans (De44

Equity Compensation Plans (Details Textual) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended
	Jan. 31, 2017	Mar. 31, 2018	Apr. 10, 2018
Granted		10,000
Equity incentive plans, description	The Company granted 11.3 million incentive units to Purple Team, LLC, an entity for the benefit of certain employees, which vest over four years (with 25% vesting after the first year and the remaining monthly vesting thereafter for the following 36 months) from the later of the first of the month after their respective date of hire or January 1, 2016. These incentive units were non-voting and the unit holders only participate in potential liquidating distributions after a future majority sale of the Company. Incentive unit holders were only eligible to participate after the distribution threshold of approximately $135.0 million was met. The majority sale and $135.0 million threshold were considered performance conditions of the incentive units. As of December 31, 2017, the Company has not recorded any costs related to the incentive units, as the achievement of the performance conditions was not yet deemed probable.
Equity incentive plan, distribution amount	$ 135,000
Remaining threshold amount of stock options	$ 96,200
2016 Equity Incentive Plan [Member]
Equity incentive plan, authorized issuance	12,000
Granted	11,300
2017 Equity Incentive Plan [Member] | Subsequent Event [Member]
Equity incentive plan, authorized issuance			4,100