Cover
Cover | 9 Months Ended |
Sep. 30, 2021 | |
Cover [Abstract] | |
Document Type | S-1 |
Entity Registrant Name | KNOWBE4, INC. |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | true |
Entity Ex Transition Period | true |
Entity Central Index Key | 0001664998 |
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets | |||
Cash and cash equivalents | $ 272,273 | $ 85,582 | $ 48,864 |
Accounts receivable, net of allowance for doubtful accounts | 44,814 | 38,664 | 32,003 |
Current portion of deferred commissions | 17,043 | 13,177 | 10,684 |
Prepaid and other current assets | 12,462 | 6,124 | 6,925 |
Total current assets | 346,592 | 143,547 | 98,476 |
Deferred commissions, net of current portion | 29,370 | 24,022 | 18,492 |
Capitalized software and content, net | 14,525 | 15,523 | 16,023 |
Property and equipment, net | 9,117 | 10,284 | 8,740 |
Operating lease right of use assets, net | 12,460 | 12,067 | 7,076 |
Intangible assets, net | 8,168 | 2,985 | 2,493 |
Goodwill | 42,607 | 8,605 | 8,873 |
Other assets | 1,074 | 1,177 | 855 |
Total assets | 463,913 | 218,210 | 161,028 |
Current liabilities: | |||
Accounts payable and accrued expenses | 36,040 | 19,265 | 18,093 |
Current portion of deferred revenue | 170,149 | 127,043 | 93,037 |
Current portion of operating lease liabilities | 3,245 | 2,651 | 2,044 |
Total current liabilities | 209,434 | 148,959 | 113,174 |
Non-current liabilities: | |||
Deferred revenue, net of current portion | 70,425 | 58,653 | 45,953 |
Operating lease liabilities, net of current portion | 9,765 | 9,766 | 5,368 |
Other non-current liabilities | 2,184 | 3,991 | 1,548 |
Total liabilities | 291,808 | 221,369 | 166,043 |
Stockholders’ (deficit) equity | |||
Preferred stock, $0.00001 par value, 114,164,600 shares authorized, issued and outstanding (Liquidation value $384.5 million) at December 31, 2019 and December 31, 2020, respectively, and 0 shares authorized, issued, and outstanding at September 30, 2021 | 0 | 0 | 0 |
Common stock | 0 | 0 | 0 |
Additional paid-in capital | 350,693 | 158,483 | 154,287 |
Accumulated deficit | (177,546) | (161,303) | (158,873) |
Accumulated other comprehensive loss | (1,044) | (339) | (429) |
Total stockholders’ (deficit) equity | 172,105 | (3,159) | (5,015) |
Total liabilities and stockholders’ (deficit) equity | 463,913 | 218,210 | 161,028 |
Common Stock, Class A | |||
Stockholders’ (deficit) equity | |||
Common stock | 0 | 0 | 0 |
Common Stock, Class B | |||
Stockholders’ (deficit) equity | |||
Common stock | $ 2 | $ 0 | $ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Stockholders’ (deficit) equity | |||
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized (in shares) | 0 | 114,164,600 | 114,164,600 |
Preferred stock, shares issued (in shares) | 0 | 114,164,600 | 114,164,600 |
Preferred stock, shares outstanding (in shares) | 0 | 114,164,600 | 114,164,600 |
Preferred stock, liquidation value | $ 384,502 | $ 384,502 | |
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized (in shares) | 0 | 176,000,000 | 176,000,000 |
Common stock, shares issued (in shares) | 0 | 42,279,000 | 42,087,280 |
Common stock, shares outstanding (in shares) | 0 | 42,279,000 | 42,087,280 |
Common Stock, Class A | |||
Stockholders’ (deficit) equity | |||
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 0 | 0 |
Common stock, shares issued (in shares) | 32,084,175 | 0 | 0 |
Common stock, shares outstanding (in shares) | 32,084,175 | 0 | 0 |
Common Stock, Class B | |||
Stockholders’ (deficit) equity | |||
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized (in shares) | 500,000,000 | 0 | 0 |
Common stock, shares issued (in shares) | 139,273,684 | 0 | 0 |
Common stock, shares outstanding (in shares) | 139,273,684 | 0 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Income Statement [Abstract] | |||||
Revenues, net | $ 176,991 | $ 125,599 | $ 174,886 | $ 120,575 | |
Cost of revenues | 25,543 | 19,264 | 26,730 | 20,579 | |
Gross profit | 151,448 | 106,335 | 148,156 | 99,996 | |
Operating expenses: | |||||
Sales and marketing | 82,312 | 60,254 | 82,188 | 69,090 | |
Technology and development | 20,081 | 14,119 | 19,804 | 10,662 | |
General and administrative | 62,765 | 34,536 | 47,706 | 145,776 | |
Total operating expenses | 165,158 | 108,909 | 149,698 | 225,528 | |
Operating loss | (13,710) | (2,574) | (1,542) | (125,532) | |
Other income (expense): | |||||
Interest income | 41 | 159 | 197 | 799 | |
Interest expense | (329) | (45) | (60) | (47) | |
Other income | (445) | 142 | 807 | 90 | |
Loss before income tax benefit (expense) | (14,443) | (2,318) | (598) | (124,690) | |
Income tax benefit (expense) | (1,800) | (316) | (1,832) | 367 | |
Net loss | $ (16,243) | $ (2,634) | $ (2,430) | $ (124,323) | |
Net loss per share, basic (in dollars per share) | [1] | $ (0.17) | $ (0.06) | $ (0.06) | $ (1.91) |
Net loss per share, diluted (in dollars per share) | [1] | $ (0.17) | $ (0.06) | $ (0.06) | $ (1.91) |
Weighted-average shares used in calculating basic net loss per share (in shares) | 98,076,290 | 42,116,480 | 42,049,840 | 66,958,400 | |
Weighted-average shares used in calculating diluted net loss per share (in shares) | 98,076,290 | 42,116,480 | 42,049,840 | 66,958,400 | |
[1] | At September 30, 2021, basic and diluted loss per share for Class A and Class B common stock are the same. |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (16,243) | $ (2,634) | $ (2,430) | $ (124,323) |
Other comprehensive (loss) income: | ||||
Net change in foreign currency translation adjustments | (1,072) | 90 | 23 | |
Other comprehensive income (loss): | (705) | (1,072) | 90 | 23 |
Total comprehensive loss | $ (16,948) | $ (3,706) | $ (2,340) | $ (124,300) |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands | Total | Conversion of convertible preferred stock and previously authorized Common Stock to Common Stock, Class B | Preferred shares, Series C | Preferred shares, Series C-1 | Convertible Preferred Stock | Convertible Preferred StockConversion of convertible preferred stock and previously authorized Common Stock to Common Stock, Class B | Convertible Preferred StockPreferred shares, Series C | Convertible Preferred StockPreferred shares, Series C-1 | Common Stock | Common StockConversion of convertible preferred stock and previously authorized Common Stock to Common Stock, Class B | Common StockCommon Stock, Class A | Common StockCommon Stock, Class AConversion of Class B common stock to Class A common stock | Common StockCommon Stock, Class B | Common StockCommon Stock, Class BConversion of convertible preferred stock and previously authorized Common Stock to Common Stock, Class B | Common StockCommon Stock, Class BConversion of Class B common stock to Class A common stock | Additional Paid In Capital | Additional Paid In CapitalPreferred shares, Series C | Additional Paid In CapitalPreferred shares, Series C-1 | Accumulated Other Comprehensive (Loss) Income | Accumulated Deficit |
Beginning balance (in shares) at Dec. 31, 2018 | 55,245,840 | 92,097,360 | ||||||||||||||||||
Beginning balance at Dec. 31, 2018 | $ 10,521 | $ 0 | $ 0 | $ 45,523 | $ (452) | $ (34,550) | ||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||
Issuance of common stock for exercise of stock options (in shares) | 1,947,760 | 9,402,120 | ||||||||||||||||||
Issuance of common stock for exercise of stock options | $ 353 | 353 | ||||||||||||||||||
Repurchase of common stock (in shares) | (59,412,200) | |||||||||||||||||||
Repurchase of common stock | (339,880) | (339,880) | ||||||||||||||||||
Dividends paid | (10,000) | (10,000) | ||||||||||||||||||
Issuance of preferred stock or common stock (in shares) | 6,511,400 | 52,407,360 | ||||||||||||||||||
Issuance of preferred stock or common stock | $ 31,163 | $ 309,230 | $ 31,163 | $ 309,230 | ||||||||||||||||
Stock compensation expense | 117,898 | 117,898 | ||||||||||||||||||
Other comprehensive income | 23 | 23 | ||||||||||||||||||
Net loss | (124,323) | (124,323) | ||||||||||||||||||
Ending balance (in shares) at Dec. 31, 2019 | 114,164,600 | 42,087,280 | ||||||||||||||||||
Ending balance at Dec. 31, 2019 | (5,015) | $ 0 | $ 0 | 154,287 | (429) | (158,873) | ||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||
Issuance of common stock for exercise of stock options (in shares) | 234,480 | |||||||||||||||||||
Issuance of common stock for exercise of stock options | 157 | 157 | ||||||||||||||||||
Repurchase of common stock (in shares) | (136,880) | |||||||||||||||||||
Repurchase of common stock | (927) | (927) | ||||||||||||||||||
Stock compensation expense | 3,285 | 3,285 | ||||||||||||||||||
Other comprehensive income | (1,072) | (1,072) | ||||||||||||||||||
Net loss | (2,634) | (2,634) | ||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2020 | 114,164,600 | 42,184,880 | ||||||||||||||||||
Ending balance at Sep. 30, 2020 | (6,206) | $ 0 | $ 0 | 156,802 | (1,501) | (161,507) | ||||||||||||||
Beginning balance (in shares) at Dec. 31, 2019 | 114,164,600 | 42,087,280 | ||||||||||||||||||
Beginning balance at Dec. 31, 2019 | $ (5,015) | $ 0 | $ 0 | 154,287 | (429) | (158,873) | ||||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||
Issuance of common stock for exercise of stock options (in shares) | 328,600 | 328,600 | ||||||||||||||||||
Issuance of common stock for exercise of stock options | $ 220 | 220 | ||||||||||||||||||
Repurchase of common stock (in shares) | (868,640) | |||||||||||||||||||
Repurchase of common stock | (5,579) | (5,579) | ||||||||||||||||||
Issuance of preferred stock or common stock (in shares) | 731,760 | |||||||||||||||||||
Issuance of preferred stock or common stock | 4,274 | 4,274 | ||||||||||||||||||
Stock compensation expense | 5,281 | 5,281 | ||||||||||||||||||
Other comprehensive income | 90 | 90 | ||||||||||||||||||
Net loss | (2,430) | (2,430) | ||||||||||||||||||
Ending balance (in shares) at Dec. 31, 2020 | 114,164,600 | 42,279,000 | 0 | 0 | ||||||||||||||||
Ending balance at Dec. 31, 2020 | $ (3,159) | $ 0 | $ 0 | $ 0 | $ 0 | 158,483 | (339) | (161,303) | ||||||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||||||||||
Issuance of common stock for exercise of stock options (in shares) | 3,173,728 | 274,720 | 2,899,008 | |||||||||||||||||
Issuance of common stock for exercise of stock options | $ 3,435 | 3,435 | ||||||||||||||||||
Issuance of common stock for the acquisition of MediaPro (in shares) | 1,245,440 | |||||||||||||||||||
Issuance of common stock for the acquisition of MediaPro | 24,675 | 24,675 | ||||||||||||||||||
Repurchase of common stock (in shares) | (97,600) | |||||||||||||||||||
Repurchase of common stock | (181) | (181) | ||||||||||||||||||
Conversion of stock to Common stock (in shares) | (114,164,600) | (43,701,560) | 21,128,743 | 157,866,160 | (21,128,743) | |||||||||||||||
Conversion of stock to Common stock | $ 2 | $ 2 | ||||||||||||||||||
Issuance of preferred stock or common stock (in shares) | 10,425,000 | |||||||||||||||||||
Issuance of preferred stock or common stock | 153,796 | 153,796 | ||||||||||||||||||
Issuance of restricted stock units (in shares) | 954,297 | |||||||||||||||||||
Taxes paid related to net share settlement of equity awards (in shares) | (423,865) | (362,741) | ||||||||||||||||||
Taxes paid related to net share settlement of equity awards | (11,892) | (11,892) | ||||||||||||||||||
Stock compensation expense | 22,377 | 22,377 | ||||||||||||||||||
Other comprehensive income | (705) | (705) | ||||||||||||||||||
Net loss | (16,243) | (16,243) | ||||||||||||||||||
Ending balance (in shares) at Sep. 30, 2021 | 0 | 0 | 32,084,175 | 139,273,684 | ||||||||||||||||
Ending balance at Sep. 30, 2021 | $ 172,105 | $ 0 | $ 0 | $ 0 | $ 2 | $ 350,693 | $ (1,044) | $ (177,546) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash flows from operating activities: | ||||
Net loss | $ (16,243) | $ (2,634) | $ (2,430) | $ (124,323) |
Adjustments to reconcile net loss to net cash from operating activities: | ||||
Additions to capitalized content | (4,504) | (4,063) | (5,215) | (6,368) |
Depreciation and amortization expense | 9,999 | 8,660 | 11,762 | 7,898 |
Deferred commissions amortization | 13,806 | 10,402 | 14,238 | 12,279 |
Equity-based compensation expense | 23,151 | 3,285 | 5,281 | 118,147 |
Other, net | 327 | (92) | 848 | (664) |
Changes in operating assets and liabilities: | ||||
Accounts receivable | (4,943) | 828 | (6,978) | (11,403) |
Deferred commissions | (23,112) | (15,427) | (22,161) | (22,375) |
Prepaid and other assets | (7,656) | 782 | 679 | (3,645) |
Accounts payable and other liabilities | 13,675 | 7,096 | 2,328 | 4,938 |
Deferred revenue | 51,299 | 30,787 | 46,512 | 55,234 |
Net cash provided by operating activities | 55,799 | 39,624 | 44,864 | 29,718 |
Cash flows from investing activities: | ||||
Business combinations, net of cash acquired | (11,227) | 0 | 0 | (4,970) |
Purchases of property and equipment | (2,214) | (4,692) | (5,426) | (5,573) |
Capitalized internal-use software costs | (1,895) | (2,304) | (2,682) | (5,223) |
Net cash used in investing activities | (15,336) | (6,996) | (8,108) | (15,766) |
Cash flows from financing activities: | ||||
Dividends paid | 0 | 0 | 0 | (10,000) |
Proceeds from the exercise of stock options | 3,435 | 157 | 220 | 353 |
Repurchase of common stock and options | (1,171) | (497) | (4,857) | (339,880) |
Proceeds from the issuance of preferred stock, net of issuance costs | 0 | 0 | 0 | 340,393 |
Proceeds from the issuance of common stock | 155,958 | 0 | 4,274 | 0 |
Acquisition-related contingent liability payments | (375) | (252) | (252) | (478) |
Proceeds from finance lease obligations | 0 | 214 | 214 | 0 |
Payments for finance lease obligations | (30) | (24) | (35) | 0 |
Taxes paid for the net share settlement of restricted stock units | (11,892) | 0 | 0 | 0 |
Net cash (used in) provided by financing activities | 145,925 | (402) | (436) | (9,612) |
Effect of exchange rate changes on cash and cash equivalents | 303 | (100) | 398 | (49) |
Net change in cash and cash equivalents | 186,691 | 32,126 | 36,718 | 4,291 |
Cash and cash equivalents, beginning of period | 85,582 | 48,864 | 48,864 | 44,573 |
Cash and cash equivalents, end of period | 272,273 | 80,990 | 85,582 | 48,864 |
Supplemental disclosure of cash flow information: | ||||
Cash paid for taxes | 1,590 | 74 | 101 | 16 |
Supplemental disclosure of noncash investing and financing activities: | ||||
Capital expenditures and other assets included in accounts payable and accrued expenses | 508 | 602 | 875 | 1,723 |
Stock compensation recorded as liability | $ 0 | $ 700 | $ 991 | $ 249 |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Description of Business KnowBe4, Inc. (“KnowBe4” or the “Company”), was incorporated in Delaware in January 2016 and is the successor to operations which began in August 2010. The Company is currently headquartered in Clearwater, Florida. The Company provides a comprehensive platform incorporating security awareness training and simulated phishing with advanced analytics and reporting that helps organizations manage the ongoing problem of social engineering. Additional offerings on the Company’s platform include a security orchestration, automation and response or “SOAR” tool and a governance, risk and compliance or “GRC” product, both of which further the Company’s goal of providing products focused on meeting the needs of information security professionals. KnowBe4 conducts business globally and its platform is available as a software as a service (“SaaS”) subscription. Stock Split On April 9, 2021, the Company effected a 40-for-1 forward stock split of its authorized, issued and outstanding capital stock. All share and per share amounts presented in the accompanying consolidated financial statements have been retrospectively adjusted to reflect the forward stock split for all periods presented. Initial Public Offering As further described in Note 11 “Stockholders’ Equity”, in April 2021, the Company completed an initial public offering (“IPO”) of its Class A common stock. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies a. Basis of Presentation and Consolidation The Company’s consolidated financial statements and accompanying notes include the accounts of the Company and its wholly-owned subsidiaries and have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”). All intercompany balances and transactions have been eliminated in consolidation. Certain prior period amounts within the accompanying consolidated balance sheets reflect an immaterial error correction and have been reclassified. The consolidated balance sheets as of December 31, 2020 and 2019 differ from the previously filed Form S-1 as they reflect an adjustment to reclassify amounts from noncurrent deferred revenue to current deferred revenue. b. Unaudited Interim Consolidated Financial Information The accompanying interim consolidated balance sheet as of September 30, 2021, the consolidated statements of operations, stockholder’s equity, and cash flows for the nine months ended September 30, 2020 and 2021 are unaudited. These interim consolidated financial statements have been prepared on a basis consistent with the annual consolidated financial statements and, in the opinion of management, include all adjustments necessary to fairly state our financial position as of September 30, 2021 and the results of our operations and cash flows for the nine months ended September 30, 2020 and 2021. The financial data and other financial information disclosed in the notes to these consolidated financial statements related to the nine month periods are also unaudited. The results for the nine months ended September 30, 2021 are not necessarily indicative of the operating results expected for the year ending December 31, 2021 or any future period. c. Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the Company’s consolidated financial statements and accompanying notes. Estimates and assumptions used by management primarily affect revenue recognition, deferred commissions, business combinations, common stock valuations and stock-based compensation expense. These estimates are based on information available as of the date of the consolidated financial statements. On an ongoing basis, the Company evaluates these assumptions, judgments and estimates. Actual results may differ materially from these estimates. d. Operating Segments The Company operates as a single operating segment, which engages in the development, marketing, and sale of the Company’s SaaS-based security awareness platform. Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and assess performance. The Company’s chief operating decision maker is the Chief Executive Officer, who is responsible for evaluating the Company’s financial results, evaluating the Company’s resources and assessing the performance of the operations on a consolidated basis. e. Cash and Cash Equivalents The Company considers all investments purchased with an original maturity of 90 days or less to be cash equivalents. Cash and cash equivalents include $29.9 million, $22.5 million and $26.3 million of overnight money market mutual funds at December 31, 2019, December 31, 2020 and September 30, 2021, respectively. The carrying amount of such cash equivalents approximates their fair value due to the short-term and highly liquid nature of these instruments. f. Accounts Receivable Accounts receivable represents amounts owed to the Company for subscriptions to the Company’s platform and unbilled receivables representing the Company’s unconditional right to consideration for subscription contracts for which revenue has been earned in excess of the amount invoiced. Accounts receivable balances are recorded at the invoiced amount and are non-interest bearing. The Company maintains an allowance for doubtful accounts based on future expected credit losses measured over the contractual term of the receivable. Management regularly reviews the adequacy of the allowance for doubtful accounts by considering various factors including the age of each outstanding invoice, each customer’s expected ability to pay, historical loss rates and expectations of forward-looking loss estimates to determine whether the allowance is appropriate. The Company writes off accounts receivable balances to the allowance for doubtful accounts when the Company has exhausted all collection efforts. As of December 31, 2019, December 31, 2020 and September 30, 2021 the allowance for doubtful accounts was $0.2 million, $0.4 million and $0.4 million, respectively. Allowance activity for the periods was not material to the consolidated financial statements. g. Deferred Commissions The Company capitalizes sales commissions and associated payroll taxes paid to internal sales personnel that are considered incremental costs to acquire a customer contract. These costs are classified as deferred commissions on the consolidated balance sheets. Sales commissions related to an initial subscription contract are considered incremental to the acquisition of the customer contract to the extent that they exceed commissions earned on renewal sales. Sales commissions related to the renewal of a subscription contract are not considered commensurate with the commissions paid for the acquisition of the initial subscription contract given the substantive difference in commission rate between new and renewal contracts. The portion of commissions paid upon the initial acquisition of a contract that are incremental to acquisition of the customer contract are amortized over an estimated period of benefit of six years. The portion of commissions paid upon initial acquisition that are commensurate with those paid on a renewal contract and commissions paid related to renewal contracts are amortized over the average length of the related revenue contract. An estimate of the portion of commissions related to the downloadable content performance obligation is made, which is recognized at contract inception consistent with the pattern of revenue recognition. The estimated period of benefit for commissions paid for the acquisition of the initial subscription contract is determined based on qualitative and quantitative factors including the initial estimated customer life, the technological life of the Company’s platform and related significant features, customer attrition and industry practices. Amortization of deferred sales commissions is included in sales and marketing expense in the accompanying consolidated statements of operations. h. Property and Equipment, Net Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets, as follows: Computers and equipment 3 years Furniture and fixtures 5 - 7 years Leasehold improvements shorter of lease term or 5 years Expenditures which significantly add to productive capacity or extend the useful life of an asset are capitalized. Maintenance and repairs to property and equipment are expensed as incurred. When assets are retired or otherwise disposed of, the cost and accumulated depreciation is removed from the accounts and gains or losses, if any, are recorded in other expenses. i. Capitalized Software and Content, Net The Company capitalizes costs incurred related to the development of internal use software during the application development stage. These capitalized costs are primarily related to the development of the Company’s security awareness platform. Costs are capitalized to develop new internal use software or to significantly increase the functionality of existing software. Capitalized software costs are amortized on a straight-line basis over the software’s estimated useful life of two The Company also capitalizes costs related to the production of its training content, which includes interactive modules, movie series, videos, games and other content. Costs associated with the production of content, including development costs, direct costs and production overhead, are capitalized. Capitalized content is amortized over the estimated period of use, which generally ranges from two j. Goodwill and Intangible Assets Goodwill represents the excess of the purchase price in a business combination over the estimated fair value of identifiable net assets acquired. The Company evaluates and tests the recoverability of goodwill for impairment at least annually, on October 1, or more frequently if circumstances indicate that goodwill may not be recoverable. The Company performs the impairment testing by first assessing qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of its single reporting unit is less than its carrying amount. In assessing the qualitative factors, the Company considers the impact of certain key factors including macroeconomic conditions, industry and market considerations, changes in management, litigation or regulatory matters, changes in enterprise value, and overall financial performance. If, after assessing the totality of events or circumstances, the Company determines it is more likely than not that the fair value of the reporting unit is less than its carrying amount, the Company calculates the estimated fair value of the reporting unit and any excess of the carrying amount over fair value is recognized as a goodwill impairment loss. Based on the results of the qualitative goodwill impairment analyses, the Company has determined there were no triggering events indicating impairment of goodwill during the years ended December 31, 2019 and 2020 or the nine months ended September 30, 2020 and 2021. Intangible assets consist of both definite-lived intangible assets, primarily acquired training content, customer relationship assets, patents, trademarks and domain names, and indefinite-lived trade name intangible assets. Definite-lived intangible assets are amortized on a straight-line basis over their estimated useful lives, as follows: Acquired content 3 - 4 years Customer relationships 4 - 6 years Other Intangibles 3 - 10 years Patents 20 years k. Impairment of Intangible and Other Long-Lived Assets The Company performs an impairment review of long-lived assets, including property and equipment and both definite and indefinite-lived intangible assets, whenever events or changes in circumstances indicate that the carrying value may not be recoverable, in accordance with the respective accounting standards. If the Company determines that the carrying value of an asset group may not be recoverable, the Company measures recoverability by comparing the carrying amount of the asset group to the future undiscounted cash flows it expects the asset group to generate. If the Company considers any of these assets to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset exceeds its fair value. In addition, the Company periodically evaluates the estimated remaining useful lives of long-lived assets to determine whether events or changes in circumstances warrant a revision to the remaining period of depreciation or amortization. No impairment indicators were identified and no impairment charges were recorded during the years ended December 31, 2019 and 2020 or the nine months ended September 30, 2020 and 2021. l. Leases The Company determines whether an arrangement is or contains a lease at inception and classifies its leases at commencement. Operating leases with initial terms of twelve months or greater are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities in the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying assets over the term of the lease and lease liabilities represent the Company’s contractual obligation to make lease payments over the lease term. Operating lease ROU assets and lease liabilities are recognized at the commencement date based on the present value of the lease payments over the lease term. Operating lease ROU assets also include any unamortized initial direct costs and any prepayments less any unamortized lease incentives received. As the Company’s leases do not provide an implicit rate for use in determining the present value of future payments, the Company uses its incremental borrowing rate. Options to extend or terminate a lease are included in the ROU asset and lease liability when it is reasonably certain that the Company will exercise the option. Lease expense for minimum lease payments for operating leases is recognized on a straight-line basis over the lease term and is included in operating expenses within the consolidated statement of operations. Variable lease costs represent non-lease components, namely common area maintenance and taxes, that are not fixed and are expensed as incurred. Effective January 1, 2019, the Company adopted ASC Topic 842 - Leases, using the modified retrospective method. m. Income Taxes The Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on temporary differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The Company’s tax positions are subject to income tax audits by certain tax jurisdictions throughout the world. The Company recognizes the tax benefit of an uncertain tax position only if it is more likely than not that the position will be sustainable upon examination by the taxing authority. The tax benefit recognized is measured as the largest amount of benefit which is greater than 50 percent likely to be realized upon settlement with the taxing authority. The Company recognizes interest accrued and penalties related to unrecognized tax benefits in the income tax (benefit) provision. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts that are more likely than not expected to be realized based on the weighting of positive and negative evidence. Future realization of deferred tax assets ultimately depends on the existence of sufficient taxable income of the appropriate character (for example, ordinary income or capital gain) within the carryback or carryforward periods available under the applicable tax law. The Company regularly reviews the deferred tax assets for recoverability based on historical taxable income, projected future taxable income, the expected timing of the reversals of existing temporary differences and tax planning strategies. The Company’s judgments regarding future profitability may change due to many factors, including future market conditions and the ability to successfully execute its business plans and/or tax planning strategies. Should there be a change in the ability to recover deferred tax assets, the tax provision would increase or decrease in the period in which the assessment is changed. n. Foreign Currency Transactions The functional currency of the Company’s subsidiaries is determined based on the primary economic environment in which the subsidiary operates. Assets and liabilities of its non-U.S. dollar functional currency subsidiaries are translated into U.S. dollars using exchange rates in effect at the end of each period and revenues and expenses are translated at the average exchange rate for the period. Gains and losses from these translations are recognized as cumulative translation adjustments and included in accumulated other comprehensive loss. The Company remeasures monetary assets and liabilities that are not denominated in the functional currency at average exchange rates in effect during each period. Gains and losses from these remeasurement adjustments are recognized within other income. o. Revenue Recognition The Company derives substantially all of its revenue from subscription services fees paid by customers for access to the Company’s cloud-based platform and content. The Company applies the following five-step approach for considering contracts: • identification of the contract, or contracts, with the customer; • identification of the performance obligations in the contract; • determination of the transaction price; • allocation of the transaction price to the performance obligations in the contract; and • recognition of revenue when, or as, the Company satisfies a performance obligation. The Company recognizes revenue at the time the related performance obligation is satisfied by transferring the service to a customer in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services, net of any sales or other tax. The Company’s subscription contracts typically vary from one year to three years and are generally noncancellable and nonrefundable. Subscription service revenue consists of subscription fees earned from providing access to the Company’s cloud-based platform, including support services and feature upgrades, if and when available. The Company’s cloud-based platform also includes training content which can be downloaded by the customer during their subscription term. The subscription service contracts do not provide customers with the right to take possession of the software operating on the cloud platform and, as a result, are accounted for as service arrangements. Access to the platform represents a series of distinct services that the Company continually provides access to, which fulfills its obligation to the end customer over the subscription term. This series of distinct services represents a single performance obligation that is satisfied over time. Accordingly, the amounts invoiced related to the ratable portion of subscription revenue are recorded as deferred revenue and recognized on a straight-line basis over the contract term, beginning on the date that the service is made available to the customer. Amounts expected to be recognized within one year of the balance sheet date are classified within current liabilities and the remaining portion is classified in long-term liabilities. The customers’ ability to access and download content throughout their subscription term is considered distinct and accounted for as a separate performance obligation. The portion of the transaction price allocated to the downloadable content performance obligation is recognized as revenue at contract inception when the customer gains access to downloadable content. The transaction price is allocated to the separate performance obligations on a relative stand-alone selling price (“SSP”) basis, which requires significant judgment. The Company determines SSP using an adjusted market assessment approach based on the prices at which we sell subscription services, including adjustments for standard discounting practices. As it relates to the content available for download, the calculation of SSP primarily considers pricing differences among varying subscription tiers, which provide customers with differing levels of content. p. Cost of Revenues Cost of revenues consists of certain direct costs associated with delivering the Company’s platform and includes hosting fees as well as amortization of capitalized internal-use software and content and allocated overhead. Cost of revenues also includes personnel costs, including salaries, benefits, bonuses, and stock-based compensation, for employees who provide support services to customers. q. Stock-Based Compensation The Company accounts for stock-based awards, including restricted stock units (“RSUs”) and stock options, based on the awards’ estimated grant date fair value. The grant date fair value of RSUs is measured at the grant date closing stock price and expense is recognized on a straight-line basis over the requisite service period of the awards and forfeitures are accounted for as incurred. The Company estimates the fair value of its stock options using the Black-Scholes option-pricing model. The determination of the grant date fair value using an option-pricing model is affected by the estimated fair value of the Company’s common stock as well as assumptions regarding a number of other complex and subjective variables. These variables include: • Fair Value of Common Stock - Prior to the Company’s IPO, because the Company’s common stock was not yet publicly traded, the Company estimated the fair value of common stock, as discussed below. • Expected Term - The expected term is estimated using the simplified method, due to a lack of historical exercise activity. The simplified method calculates the expected term as the mid-point of the vesting date and the contractual expiration date of the award. • Volatility - Since the Company does not have a trading history of its common stock, the expected volatility is determined based on the historical stock volatilities of comparable companies. Comparable companies consist of public companies in the industry, which are similar in size, stage of life cycle and financial leverage. The Company intends to continue to apply this process using the same or similar public companies until a sufficient amount of historical information regarding the volatility of its own share price becomes available, or until circumstances change such that the identified companies are no longer similar, in which case, more suitable companies whose share prices are publicly available would be used in the calculation. • Risk-Free Interest Rate - The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the date closest to the grant date for U.S. Treasury zero-coupon issues with maturities approximating the expected term of the awards. • Dividend Yield - The expected dividend assumption is based on the Company’s current expectations about its anticipated dividend policy. As the Company has a history of only paying a single one-time dividend and does not anticipate paying dividends in the future, the Company uses an expected dividend yield of zero. The resulting fair value is recognized on a straight-line basis, net of forfeitures, which are recorded as incurred, over the requisite service period. Prior to the Company’s IPO, the Company’s board of directors exercised judgment and considered numerous objective and subjective factors to determine the best estimate of the fair value of our common stock including (i) valuations performed at or near the time of grant; (ii) rights, preferences, and privileges of our redeemable convertible preferred stock relative to those of our common stock; (iii) our actual operating and financial performance at the time of the option grant; (iv) likelihood of achieving a liquidity event, such as an initial public offering or a merger or acquisition of our business; (v) the value of comparable companies with respect to industry, business model, stage of growth, financial risk or other factors; (vi) our stage of development and future financial projections; (vii) market transactions at or near the time of grant; and (viii) the lack of marketability of our common stock. The Company has historically utilized unrelated third-party specialists to prepare valuations in accordance with the American Institute of Certified Public Accountants Practice Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation , or AICPA Guide. Prior to the Company’s IPO, the Company used the Probability Weighted Expected Return Method (“PWERM”), method for estimating the Company’s common stock value, since this is the preferred method for a company expecting a liquidity event in the near future. PWERM involves a forward-looking analysis of the possible future outcomes of the enterprise. Discrete future outcomes considered under the PWERM included an IPO as well as non-IPO market-based outcomes. Determining the fair value of the enterprise using the PWERM required the Company to develop assumptions and estimates for both the probability of an IPO liquidity event and non-IPO outcomes, as well as the values the Company expected those outcomes could yield. After the equity value is determined and allocated to the various classes of shares, a discount for lack of marketability (“DLOM”), is applied to arrive at the fair value of common stock based on the theory that as an owner of a private company stock, the stockholder has limited opportunities to sell this stock and any such sale would involve significant transaction costs, thereby reducing overall fair market value. Following the IPO, there is an active market for the Company’s Class A common stock, and the Company is no longer applying these valuation approaches. The Company’s Employee Stock Purchase Plan (“ESPP”) allows eligible employees to acquire shares of the Company’s Class A common stock by accumulating funds through payroll deductions of up to 15% of their compensation, subject to plan limitations. Purchases are accomplished through participation in discrete offering periods. Each offering period is six months and consists of one six-month purchase period, unless otherwise determined by the Company’s board of directors or our compensation committee. The purchase price for shares of our common stock purchased under our ESPP is 85% of the lesser of the fair market value of our common stock on (i) the first trading day of the applicable offering period or (ii) the last trading day of the purchase period in the applicable offering period. Stock-based compensation expense related to ESPP purchases is recorded based on the fair value of the ESPP purchase right estimated on the grant date using a Black-Scholes option-pricing model. r. 401(k) Plan The Company maintains a tax-qualified retirement plan, or the 401(k) plan, that provides eligible employees with an opportunity to save for retirement on a tax-advantaged basis. Eligible employees are able to participate in the 401(k) plan as of the first day of the month following the date they meet the 401(k) plan’s eligibility requirements, and participants are able to defer up to 100% of their eligible compensation subject to applicable annual Internal Revenue Code limits. All participants’ interests in their deferrals are 100% vested when contributed and the Company’s matching contributions are 100% vested following one year of service. The Company contracted with a third-party provider to act as a custodian and trustee, and to process and maintain the records of participant data. For the years ended December 31, 2019 and 2020 or for the nine months ended September 30, 2020 and 2021, the Company made contributions to the 401(k) Plan of $1.2 million, $2.4 million, $1.8 million and $1.6 million, respectively. s. Advertising Advertising costs are expensed as incurred. Advertising expenses were $12.2 million, $13.3 million, $9.9 million and $10.5 million for the years ended December 31, 2019 and 2020 and for the nine months ended September 30, 2020 and 2021, respectively. These costs are included within sales and marketing expenses in the accompanying consolidated statements of operations. t. Research and Development Costs Research and development costs are expensed when incurred, except for certain internal-use software development costs, which may be capitalized as noted above. Research and development expenses consist primarily of personnel and related headcount costs, costs of professional services associated with the ongoing development of the Company’s technology, and allocated overhead and are recorded within technology and development expense in the accompanying consolidated statements of operations. u. Net Loss per Share Basic and diluted net loss per share is presented in conformity with the two-class method required for participating securities. Prior to the IPO, the Company considered all series of its convertible preferred stock to be participating securities. Net loss was not allocated to the convertible preferred stock as the holders of the convertible preferred stock do not have a contractual obligation to share in any losses. Since the completion of the IPO, the Company considers shares of Class B common stock to be participating securities, since each share of Class B common stock is convertible into one share of Class A common stock at the option of the holder. Net income is attributed to common stockholders and participating securities based on their participation rights. Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by giving affect to all potentially dilutive common stock equivalents to the extent they are dilutive. As the Company has reported losses for all periods presented, all potentially dilutive securities are antidilutive and, accordingly, basic net loss per share equals diluted net loss per share. v. Business Combinations The Company includes the results of operations of the businesses that it acquires as of the respective dates of acquisition. The Company allocates the fair value of the purchase price of its acquisitions to the assets acquired and liabilities assumed based on their estimated fair values at the date of acquisition. The excess of the fair value of the purchase price over the fair values of these identifiable assets and liabilities is recorded as goodwill. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. Significant estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows from acquired users, acquired technology, the value of trade names from a market participant perspective, useful lives and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and, as a result, actual results may differ from estimates. During the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the fair value of assets acquired and liabilities assumed. Upon conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the Company’s consolidated statement of operations. w. Concentrations of Credit Risk and Significant Customers The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company’s cash deposits typically exceed the federally insured limits. Collateral is not required for accounts receivable. No single customer accounted for more than ten percent of total revenue during the years ended December 31, 2019 and 2020 or the nine months ended September 30, 2020 and 2021. Additionally, no single customer accounted for more than ten percent of accounts receivable at December 31, 2019, December 31, 2020 or September 30, 2021. x. Fair Value Measurement Assets and liabilities recorded at fair value in the consolidated financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. The lowest level of significant input determines the placement of the fair value measurement within the following hierarchical levels: • Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. • Level 2: Other inputs that are directly or indirectly observable in the marketplace. • Level 3: Unobservable inputs which are supported by little or no market activity. The following tables present information about the Company’s financial assets and liabilities that are measured at fair value and indicate the fair value hierarchy of the valuation inputs used (in thousands): December 31, 2019 Quoted Prices in Active Markets for Identical Assets Significant Other Significant Total Assets: Cash equivalents: Money market mutual funds $ 29,944 $ — $ — $ 29,944 Total assets $ 29,944 $ — $ — $ 29,944 Liabilities: Accounts payable and accrued expenses: Business acquisition contingent liabilities $ — $ — $ 907 $ 907 Total liabilities $ — $ — $ 907 $ 907 December 31, 2020 Quoted P |
Revenue, Deferred Revenue and R
Revenue, Deferred Revenue and Remaining Performance Obligations | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue, Deferred Revenue and Remaining Performance Obligations | Revenue, Deferred Revenue and Remaining Performance ObligationsThe following table summarizes revenue recognized from performance obligations delivered to customers which relate to (i) subscription services which is recognized ratably over the term of the contract and (ii) initial subscription revenue representing content available for download which is recognized at a point in time, as follows (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Ratable portion of subscription revenue $ 100,084 $ 148,977 $ 107,435 $ 151,084 Subscription revenue allocated to downloadable content 20,491 25,909 18,164 25,907 Total $ 120,575 $ 174,886 $ 125,599 $ 176,991 The following table summarizes the revenue by region based on the shipping address of customers who have contracted to use the Company’s platform (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) North America $ 108,835 $ 154,131 $ 111,596 $ 149,744 International 11,740 20,755 14,003 27,247 Total $ 120,575 $ 174,886 $ 125,599 $ 176,991 Contract Balances The Company records unbilled receivables when revenue recognized on a contract exceeds amounts invoiced. Unbilled receivables were not material for the years ended December 31, 2019 and 2020 or for the nine months ended September 30, 2021. Contract liabilities consist of deferred revenue which represents contractual billings made in advance of performance under the contract. Changes in deferred revenue were as follows (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Beginning balance $ 83,676 $ 138,990 $ 138,990 $ 185,696 Plus: Additions to deferred revenue 175,636 221,671 156,221 231,869 Less: Recognition of revenue deferred in the prior year (59,682) (98,657) (81,456) (112,460) Less: Recognition of revenue deferred in the current year (60,640) (76,308) (44,143) (64,531) Ending balance $ 138,990 $ 185,696 $ 169,612 $ 240,574 Remaining Performance Obligations The transaction price allocated to remaining performance obligations represents contracted revenue that has not yet been recognized, which includes deferred revenue and unbilled amounts that will be recognized as revenue in future periods. The transaction price allocated to the remaining performance obligation is influenced by several factors, including the timing of delivery of the Company’s products and average contract terms. Unbilled portions of the remaining performance obligation are subject to future economic risks including bankruptcies, regulatory changes and other market factors. The Company excludes from the remaining performance obligation amounts related to performance obligations that are billed and recognized as they are delivered. The majority of the Company’s noncurrent remaining performance obligation is expected to be recognized in the next 13 to 36 months. Remaining performance obligations consisted of the following (in thousands): December 31, 2019 December 31, 2020 September 30, (unaudited) Current $ 98,777 $ 136,382 $ 183,117 Noncurrent 64,058 87,395 111,699 Total $ 162,835 $ 223,777 $ 294,816 Deferred Commissions Changes in deferred commissions were as follows (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Beginning balance $ 19,080 $ 29,176 $ 29,176 $ 37,199 Plus: Additions to deferred commissions 22,375 22,161 15,427 23,112 Less: Recognition of deferred commissions (12,279) (14,238) (10,402) (13,806) Plus: Foreign currency impacts on deferred commissions — 100 (4) (92) Ending balance $ 29,176 $ 37,199 $ 34,197 $ 46,413 |
Business Combinations
Business Combinations | 9 Months Ended |
Sep. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations | Business Combinations 2019 During the year ended December 31, 2019, the Company completed three business combinations that collectively increased the Company’s presence in certain international jurisdictions, including Brazil and Europe. The acquisition of these businesses provided the Company with access to additional security awareness training content and video production and content development capabilities, customer lists and developed technology. The Company has accounted for these acquisitions as business combinations in accordance with ASC 805 - Business Combinations and has included the financial results of the acquired businesses in the consolidated financial statements from the date of each respective acquisition. The total purchase price was $6.6 million, net of cash acquired of $0.8 million and contingent consideration of $1.1 million and amounts held in escrow of $0.3 million. The resulting goodwill primarily relates to the acquired workforce, synergies and opportunities for growth through geographic expansion and customer diversity and is not expected to be deductible for tax purposes. Revenues of $1.3 million, losses of $0.7 million and acquisition related costs of $0.3 million are included in the accompanying consolidated statement of operations for the year ended December 31, 2019. The following table summarizes the fair values of the assets acquired and liabilities assumed as of the date of each acquisition (in thousands): Tangible net assets $ 895 Developed technology and content 620 Trade name 190 Customer relationships 60 Goodwill 4,852 Total net asset value $ 6,617 Current year acquisition (unaudited) On March 1, 2021, the Company acquired all outstanding equity interests in MediaPro Holdings, LLC (“MediaPro”), a SaaS company that specializes in security and privacy solutions including production of digital content and custom software. The acquisition was funded using cash consideration of approximately $11.3 million, net of cash acquired of $1.9 million, and equity consideration of $24.7 million. The acquisition was accounted for as a business combination in accordance with ASC 805, Business Combination s and the Company has included the financial results of the acquired business in the consolidated financial statements from the date of acquisition. The resulting goodwill, which is deductible for tax purposes, is reflective of synergies the Company expects to realize and the assembled workforce. The Company has recorded the assets acquired and liabilities assumed at their respective fair values as of the acquisition date. MediaPro revenues and losses were not material for the nine months ended September 30, 2021. Acquisition related costs of $0.5 million are included in the accompanying consolidated statement of operations for the nine months ended September 30, 2021. The following table summarizes the fair values of the assets acquired and liabilities assumed as of the acquisition date (in thousands): Accounts receivable $ 1,391 Other assets acquired 4,171 Trade name 300 Acquired content 1,600 Customer relationships 3,300 Deferred revenue (3,919) Other liabilities acquired (3,172) Total identifiable net assets assumed 3,671 Goodwill 34,243 Total net asset value $ 37,914 The purchase price allocation was based on estimates of the fair value of the net assets acquired and is considered preliminary and subject to change as the valuation is finalized. The Company expects to finalize the valuation as soon as practicable, but not later than one year from the acquisition date. The Company has not presented pro forma results of operations because the acquisition is not material to the Company's consolidated results of operations, financial position, or cash flows. |
Capitalized Software and Conten
Capitalized Software and Content, Net | 9 Months Ended |
Sep. 30, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Capitalized Software and Content, Net | Capitalized Software and Content, Net Internally developed capitalized software and content, net consists of the following (in thousands): December 31, 2019 December 31, 2020 September 30, (unaudited) Capitalized software $ 12,628 $ 15,081 $ 16,198 Capitalized content 11,834 16,899 20,886 24,462 31,980 37,084 Less: Accumulated amortization (8,439) (16,457) (22,559) Total capitalized software and content, net $ 16,023 $ 15,523 $ 14,525 Capitalized software and content amortization expense for the years ended December 31, 2019 and 2020 and for the nine months ended September 30, 2020 and 2021, totaled $5.6 million, $8.0 million, $6.0 million and $6.2 million, respectively. These costs are primarily included in cost of revenues in the accompanying consolidated statements of operations. Capitalized software and content amounts include accumulated costs not yet placed in service of $2.1 million, $3.0 million and $2.0 million at December 31, 2019, December 31, 2020 and September 30, 2021, respectively. As these costs are not yet in service, they are not included in the following estimated future amortization expenses for capitalized software and content placed in service at the balance sheet dates shown below (in thousands): December 31, September 30, (unaudited) 2021 $ 7,033 $ 1,937 2022 3,941 5,684 2023 1,033 2,740 2024 153 938 2025 153 537 Thereafter 196 702 Total $ 12,509 $ 12,538 |
Property and Equipment, Net
Property and Equipment, Net | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | Property and Equipment, Net Property and equipment, net consists of the following (in thousands): December 31, 2019 December 31, 2020 September 30, (unaudited) Leasehold improvements $ 6,945 $ 9,143 $ 8,541 Computer and other equipment 4,111 5,630 6,566 Furniture and fixtures 1,411 2,107 2,101 12,467 16,880 17,208 Less: Accumulated depreciation (3,727) (6,596) (8,091) Total property and equipment, net $ 8,740 $ 10,284 $ 9,117 Property and equipment depreciation expense for the years ended December 31, 2019 and 2020 and for the nine months ended September 30, 2020 and 2021, totaled $2.1 million, $3.6 million, $2.6 million and $3.0 million million, respectively. Additionally, 97.2%, 92.7% and 92.6% of the Company’s property and equipment were located in the United States and 2.8%, 7.3% and 7.4% were located in various international jurisdictions, as of December 31, 2019, December 31, 2020 and September 30, 2021, respectively. |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | Intangible Assets and Goodwill Intangible assets Intangible assets, net consist of the following (in thousands): Weighted Average Amortization Period December 31, 2019 Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) Acquired content and customer relationships (1) 4.8 years $ 2,284 $ (1,673) $ 611 Domain names 1.7 years 204 (97) 107 Patents 18.9 years 337 (18) 319 Trade names and other indefinite-lived intangibles (1) Indefinite 455 — 455 In-process patents and trademarks Not applicable 1,001 — 1,001 Total intangible assets $ 4,281 $ (1,788) $ 2,493 Weighted Average Amortization Period December 31, 2020 Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) Acquired content and customer relationships (1) 3.7 years $ 2,268 $ (1,859) $ 409 Domain names 1.3 years 245 (156) 89 Patents 19.1 years 1,235 (46) 1,189 Trade names and other indefinite-lived intangibles (1) Indefinite 425 — 425 In-process patents and trademarks Not applicable 873 — 873 Total intangible assets $ 5,046 $ (2,061) $ 2,985 Weighted Average Amortization Period September 30, 2021 (unaudited) Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) Acquired content and customer relationships (1) 4.7 years $ 7,145 $ (2,512) $ 4,633 Domain names 2.1 years 258 (204) 54 Patents 18.7 years 1,687 (98) 1,589 Trade names and other indefinite-lived intangibles (1) Indefinite 716 — 716 In-process patents and trademarks Not applicable 1,176 — 1,176 Total intangible assets $ 10,982 $ (2,814) $ 8,168 _______________ (1) - Gross carrying amount includes impact of translation of foreign denominated intangible assets Intangible asset amortization for the years ended December 31, 2019 and 2020 and for the nine months ended September 30, 2020 and 2021 was $0.2 million, $0.3 million, $0.2 million and $0.8 million, respectively. These expenses are primarily presented in operating expenses with a portion allocated to cost of revenue within the accompanying consolidated statements of operations. Estimated future amortization expense is as follows (in thousands): December 31, September 30, (unaudited) 2021 $ 262 $ 296 2022 186 1,160 2023 129 1,104 2024 97 1,071 2025 97 735 Thereafter 916 1,910 Total $ 1,687 $ 6,276 Goodwill Goodwill represents the excess of the purchase price in a business combination over the fair value of net assets acquired. Goodwill amounts are not amortized, but rather tested for impairment at least annually. The changes in carrying amounts of goodwill were as follows (in thousands): Balance at December 31, 2018 $ 3,817 Acquisitions 4,852 Other adjustments (1) 204 Balance at December 31, 2019 $ 8,873 Other adjustments (1) (268) Balance at December 31, 2020 $ 8,605 Acquisitions 34,243 Other adjustments (1) (241) Balance at September 30, 2021 (unaudited) $ 42,607 ________________ |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 9 Months Ended |
Sep. 30, 2021 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Expenses | Accounts Payable and Accrued Expenses Accounts payable and accrued expenses consisted of the following (in thousands): December 31, 2019 December 31, 2020 September 30, 2021 (unaudited) Accrued commissions $ 6,298 $ 6,662 $ 8,058 Accrued payroll 5,847 4,839 16,507 Accounts payable 3,071 2,530 3,023 Other accrued expenses 2,877 5,234 8,452 Total accounts payable and accrued expenses $ 18,093 $ 19,265 $ 36,040 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Leases | LeasesThe Company primarily enters into operating lease agreements for office space and other property and equipment, some of which include options to renew or terminate the lease. The options to renew, which extend for up to 5 years, are reviewed on a per lease basis to determine if the renewal option is considered reasonably certain to be recognized and, therefore, are included in the determination of lease payments. Additionally, during the year ended December 31, 2020, the Company entered into a finance lease agreement with total future lease payments of $0.2 million, which is not considered material to the business. The components of lease costs were as follows (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Operating lease cost $ 2,133 $ 2,932 $ 1,310 $ 2,712 Short-term lease cost 562 656 328 402 Variable lease cost 484 501 240 586 Total lease cost $ 3,179 $ 4,089 $ 1,878 $ 3,700 Lease costs are primarily included in general and administrative expenses in the accompanying consolidated statements of operations. The Company reports the amortization of ROU assets and the change in operating lease liabilities on a net basis in accounts payable and other liabilities in the accompanying consolidated statements of cash flows. Other information related to operating and finance leases is as follows: Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Weighted-average remaining lease term (in years) 3.5 5.2 4.8 4.5 Weighted-average discount rate 7.8 % 5.6 % 6.6 % 3.8 % Future lease payments under non-cancellable leases recorded as of September 30, 2021, were as follows (in thousands): Operating Leases (unaudited) 2021 $ 834 2022 3,732 2023 3,208 2024 2,576 2025 2,003 Thereafter 1,703 Total lease payments 14,056 Less: imputed interest (1,046) Total future lease payments under non-cancellable leases $ 13,010 Supplemental cash flow information related to leases is as follows (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 2,152 $ 2,920 $ 2,079 $ 2,636 ROU assets obtained in exchange for lease obligations: Operating leases $ 2,287 $ 3,503 $ 3,224 $ 3,142 |
Leases | LeasesThe Company primarily enters into operating lease agreements for office space and other property and equipment, some of which include options to renew or terminate the lease. The options to renew, which extend for up to 5 years, are reviewed on a per lease basis to determine if the renewal option is considered reasonably certain to be recognized and, therefore, are included in the determination of lease payments. Additionally, during the year ended December 31, 2020, the Company entered into a finance lease agreement with total future lease payments of $0.2 million, which is not considered material to the business. The components of lease costs were as follows (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Operating lease cost $ 2,133 $ 2,932 $ 1,310 $ 2,712 Short-term lease cost 562 656 328 402 Variable lease cost 484 501 240 586 Total lease cost $ 3,179 $ 4,089 $ 1,878 $ 3,700 Lease costs are primarily included in general and administrative expenses in the accompanying consolidated statements of operations. The Company reports the amortization of ROU assets and the change in operating lease liabilities on a net basis in accounts payable and other liabilities in the accompanying consolidated statements of cash flows. Other information related to operating and finance leases is as follows: Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Weighted-average remaining lease term (in years) 3.5 5.2 4.8 4.5 Weighted-average discount rate 7.8 % 5.6 % 6.6 % 3.8 % Future lease payments under non-cancellable leases recorded as of September 30, 2021, were as follows (in thousands): Operating Leases (unaudited) 2021 $ 834 2022 3,732 2023 3,208 2024 2,576 2025 2,003 Thereafter 1,703 Total lease payments 14,056 Less: imputed interest (1,046) Total future lease payments under non-cancellable leases $ 13,010 Supplemental cash flow information related to leases is as follows (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 2,152 $ 2,920 $ 2,079 $ 2,636 ROU assets obtained in exchange for lease obligations: Operating leases $ 2,287 $ 3,503 $ 3,224 $ 3,142 |
Revolving Credit Facility
Revolving Credit Facility | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Revolving Credit Facility | Revolving Credit Facility The Company has a revolving line of credit (the “Revolving Credit Facility”) that provides for a $100.0 million revolving credit facility, with a letter of credit and swingline sublimit of $10.0 million each, and an accordion feature under which the Company can increase borrowings under the credit facility by up to $50.0 million. The Company is also obligated to pay other customary fees for a credit facility of this size and type, including letter of credit fees, an upfront fee, and an unused commitment fee which are expensed as incurred and included within interest expense in the consolidated statement of operations. The Revolving Credit Facility matures on March 12, 2024 and contains certain financial covenants. The borrowings under the Revolving Credit Facility bear interest, at our option, at a base rate equal to the highest of (a) the federal funds rate plus 0.50%, (b) the rate of interest in effect for such date as publicly announced from time to time by Bank of America as its “prime rate”, or (c) the eurodollar rate plus 1.0%, provided that such rate shall not be less than 0.5%. As of September 30, 2021, the Company did not have any outstanding borrowings under the Revolving Credit Facility, there were no issued letters of credit outstanding from the credit agreement and the Company was in compliance with all covenant requirements. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholder’s Equity Initial Public Offering On April 26, 2021, the Company completed an IPO of its Class A common stock, in which the Company issued and sold 10,425,000 shares of Class A common stock, including 1,425,000 shares resulting from the exercise in full of the underwriters’ option to purchase additional shares, at an IPO price of $16.00 per share for net proceeds to the Company of $156.0 million. Upon recording the proceeds from the transaction, the Company reclassified $2.2 million of offering costs into stockholders’ equity (deficit) as a reduction of the net proceeds received from the IPO. Immediately prior to the completion of the IPO, the Company amended its Fifth Charter in the form of the IPO Charter, which authorized capital stock consisting of 1,000,000,000 shares of Class A common stock, par value $0.00001 per share, 500,000,000 shares of Class B common stock, par value $0.00001 per share, and 100,000,000 shares of preferred stock, par value $0.00001 per share. The rights of the holders of Class A common stock and Class B common stock are identical, except with respect to voting and conversion rights. Each share of Class B common stock is entitled to 10 votes and is convertible into one share of Class A common stock. Additionally, all shares of the Company’s capital stock outstanding immediately prior to the IPO, including all of the Company’s outstanding shares of convertible preferred stock, were reclassified into shares of the Company’s Class B common stock. Stockholder’s Equity Prior to Initial Public Offering Prior to the completion of the IPO, the terms of the Company’s equity securities were defined in the Company’s Fifth Amended and Restated Certificate of Incorporation, which was filed with the Secretary of the State of Delaware on July 1, 2019 (the “Fifth Charter”). As described above, the Company amended and then restated its Fifth Charter. The summary below relates to the Company’s Fifth Charter, inclusive of the amendment, which included the forward stock split, but prior to the restatement which was filed in conjunction with the IPO. Common Stock Prior to the completion of the IPO, the Company had one class of common stock where each share of common stock entitled the holder to one vote, together with the holders of preferred stock, on all matters submitted to the stockholders for a vote. The voting, dividend and liquidation rights of the holders of the common stock are subject to and qualified by the rights, powers and preference of the holders of the preferred stock set forth below. Preferred Stock Prior to the completion of the IPO, the Company was authorized to issue 114,164,600 shares of preferred stock, par value $0.00001 per share. As of December 31, 2019 and 2020, the Company had outstanding Series A, A-1, B, C and C-1 Preferred Stock (individually referred to as “Series A, A-1, B, C or C-1” or collectively “Preferred Stock”) as follows (in thousands, except share and per share amounts): As of December 31, 2019 and 2020 Issue Price per Share Shares Authorized Issued and Outstanding Net Carrying Value Liquidation Preference Series A $ 0.26 30,525,040 30,525,040 $ 8,000 $ 8,000 Series A-1 $ 0.82 6,764,960 6,764,960 5,541 5,541 Series B $ 1.67 17,955,840 17,955,840 30,000 30,000 Series C $ 4.85 6,511,400 6,511,400 31,377 31,561 Series C-1 $ 5.90 52,407,360 52,407,360 309,015 309,400 Total 114,164,600 114,164,600 $ 383,933 $ 384,502 As it relates to voting and dividend rights, the rights, preferences, and privileges of the preferred stock did not differ from the rights of the common stock. Di vidends in the amount of $0.07 per share were declared and paid in 2019. No dividends were declared during the year ended December 31, 2020 or the nine months ended September 30, 2021. In the event of any liquidation or Deemed Liquidation Event as defined in the Certificate of Incorporation, the holders of preferred stock were entitled to the greater of (i) the original issue price of the preferred stock plus any dividends declared and unpaid thereon, or ii) the amount payable had all classes of shares been converted to common stock. Additionally, each share of preferred stock was convertible, at the option of the holder at any time, into the number of shares of common stock determined by dividing the original issue price for such series of preferred stock by the conversion price for such series of preferred share that is in effect at the time of conversion. Each share of preferred stock, other than the shares of Series C-1 preferred stock, automatically converts into common stock at the then-applicable conversion rate in the event of the closing of a sale of shares to the public in a firm-commitment underwritten public offering at a price per share of $4.85 (the “IPO Value”) that results in net proceeds to the Company of not less than $100.0 million (a “Qualifying Public Offering” or “QPO”), or (ii) upon the consent of the holders of a majority of the shares of each of the other outstanding preferred stock classes. All shares of Series C-1 Preferred Stock automatically convert into shares of Common Stock at the then-applicable conversion rate upon the closing of a QPO with an IPO Value equal to or greater than $8.86 per share or equal to or more than $6.48 per share subject to certain approvals and additional share conversion requirements. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation 2016 Equity Incentive Plan Effective January 19, 2016, the Company established the KnowBe4, Inc. 2016 Equity Incentive Plan (the “2016 Incentive Plan”). The 2016 Incentive Plan initially authorized the issuance of up to an aggregate of 32,746,480 shares of common stock in the form of stock options and other types of equity awards that may be granted to officers, employees, directors, consultants and advisors of the Company and its subsidiaries and affiliates. Effective July 2, 2019, the Company amended the 2016 Incentive Plan to increase the maximum number of shares issuable under the plan to 37,728,000 shares of common stock. The Company has only granted stock options under the 2016 Incentive Plan. These options generally become vested within four years from the date of grant and expire ten years from the date of grant, with typical vesting of 25% on the first anniversary and monthly thereafter. The Company (i) amended the 2016 Incentive Plan to clarify that, following the closing of the IPO, outstanding awards under the 2016 Incentive Plan would cover shares of the Company’s Class B common stock, and (ii) terminated the 2016 Incentive Plan; provided, however, that the 2016 Incentive Plan continues to govern the terms and conditions of outstanding awards under the 2016 Incentive Plan as of the time of its termination. As of September 30, 2021, a total of 10,583,077 shares of common stock have been reserved for issuance upon the exercise of stock options under the 2016 Incentive Plan. 2021 Equity Incentive Plan The Company’s board of directors adopted the 2021 Equity Incentive Plan (“2021 Incentive Plan”), which became effective on April 20, 2021 and authorizes a maximum number of shares issuable of 18,400,000. The 2021 Incentive Plan provides for the grant of incentive stock options, nonstatutory stock options, restricted stock, restricted stock units, stock appreciation rights, performance units and performance shares to our employees, directors and consultants and any of our future subsidiary corporations’ employees and consultants. As of September 30, 2021, 16,618,508 shares were reserved for future issuance under the 2021 Incentive Plan. Stock Options The Company records compensation expense for stock options based on the estimated fair value of the options on the date of grant using the Black-Scholes option-pricing model with the assumptions set forth in the table below. Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Expected term (years) 6.3 4.0 - 6.3 5.6 6.3 Expected stock price volatility 40.0% - 45.0% 45.0% - 50.0% 48.0 % 45.0 % Risk-free interest rate 1.4% - 2.5% 0.2% - 1.7% 0.8 % 0.8 % Dividend yield — % — % — % — % Fair value of common stock $1.07 - $4.07 $4.14 - $5.84 $4.14 - $5.71 $19.82 The following table summarizes the common stock option activity for the years ended December 31, 2019 and 2020 and for the nine months ended September 30, 2021 (unaudited): Number of Shares Weighted-Average Exercise Price Weighted-Average Grant Date Fair Value Weighted-Average Remaining Contractual Term Aggregate Intrinsic Value Options outstanding at December 31, 2018 17,101,000 $ 0.52 $ 0.20 7.5 $ 10,328 Granted 3,114,240 2.90 1.60 Exercised (1,947,760) 0.19 6,046 Repurchased (7,136,480) 0.24 Canceled, forfeited or expired (766,480) 0.98 Options outstanding at December 31, 2019 10,364,520 $ 1.47 $ 0.71 8.1 $ 18,952 Granted 5,060,720 4.93 2.22 Exercised (328,600) 0.68 3,724 Canceled, forfeited or expired (876,840) 1.92 Options outstanding at December 31, 2020 14,219,800 $ 2.73 $ 1.25 7.9 $ 131,893 Granted 40,000 12.01 11.52 312 Exercised (3,173,728) 1.84 0.71 58,274 Canceled, forfeited or expired (502,995) 4.07 1.70 8,216 Options outstanding at September 30, 2021 10,583,077 $ 2.97 $ 1.43 7.3 $ 200,938 Options vested and exercisable at September 30, 2021 7,002,237 $ 2.24 $ 1.08 6.8 $ 138,061 The aggregate intrinsic value of the options exercised represents the difference between the estimated fair value of our common stock on the date of exercise and the exercise price of the options. Share Repurchases In connection with the issuance of Series C Preferred Stock and Series C-1 Preferred Stock in 2019, the Company paid $339.3 million to repurchase Common Stock and options, the latter of which were repurchased under a modification of the original option terms. The repurchase price paid at each issuance was in excess of the fair value of the Common Stock and options on the repurchased date, which resulted in compensation expense of $115.7 million. During the years ended December 31, 2019 and 2020 and for the nine months ended September 30, 2020, the Company repurchased or promised to repurchase shares of Common Stock from former employees under pre-existing contingent call options triggered upon termination. The repurchase price paid or promised was in excess of the fair value of the Common Stock on the repurchase date, which resulted in additional compensation expense of $0.8 million, $1.9 million and $0.9 million for the years ended December 31, 2019 and 2020 and for the nine months ended September 30, 2020, respectively. As of December 31, 2019 and 2020, the Company recorded a liability representing the fair value of shares committed to be repurchased of $0.2 million and $1.0 million, respectively, which is included in accounts payable and accrued expenses in the accompanying consolidated balance sheets. During the nine months ended September 30, 2021, the Company completed it’s IPO, establishing a public market for the Company’s shares and no longer intends to repurchase shares under remaining contingent call options. Restricted Stock Units The Company recognizes stock-based compensation expense associated with restricted stock units (“RSUs”) over the term of the respective awards. The following table summarizes the RSUs activity for the for the nine months ended September 30, 2021 (unaudited): Shares Weighted-Average Grant-Date Fair Value per share Outstanding as of December 31, 2020 — $ — Granted 1,775,992 $ 16.42 Vested (954,297) $ 16.23 Forfeited or expired (5,500) $ 28.94 Outstanding as of September 30, 2021 816,195 $ 16.56 2021 Employee Stock Purchase Plan The Company’s 2021 Employee Stock Purchase Plan (“ESPP”) became effective on April 20, 2021 and allows for the sale of 3,350,000 shares of Class A common stock. The fair value of the ESPP purchase right is estimated on the grant date using the Black-Scholes option-pricing model with the following assumptions: Nine Months Ended September 30, 2021 (unaudited) Expected term (years) 0.5 Expected stock price volatility 60.9 % Risk-free interest rate 0.4 % Dividend yield — % Stock-based Compensation Expense The following table summarizes the components of stock-based compensation expense recognized in the consolidated statements of operations (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Cost of revenues $ 83 $ 188 $ 122 $ 253 Sales and marketing 5,750 1,579 825 7,277 Technology and development 162 896 323 530 General and administrative 112,110 2,571 1,983 15,212 Total stock-based compensation expense $ 118,105 $ 5,234 $ 3,253 $ 23,272 As of September 30, 2021, the Company had $18.9 million of unrecognized stock compensation associated with stock options, which is expected to be recognized over a weighted-average period of 2.5 years. |
Net Loss per Share
Net Loss per Share | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | Net Loss per Share The computation of net loss per share is as follows (in thousands, except share and per share data): Year Ended December 31, 2019 2020 Numerator: Net loss $ (124,323) $ (2,430) Less: dividend distribution allocated to preferred stockholders (3,749) — Net loss attributable to common stockholders $ (128,072) $ (2,430) Denominator: Weighted-average common shares outstanding 66,958,400 42,049,840 Net loss per share, basic and diluted $ (1.91) $ (0.06) Nine Months Ended September 30, 2020 2021 Class A Class B Numerator: Allocation of undistributed losses for basic calculation $ (2,634) $ (1,685) $ (14,558) Reallocation of undistributed losses for diluted calculation — — — Allocation of undistributed losses for diluted calculation $ (2,634) $ (1,685) $ (14,558) Denominator: Number of shares used in basic and diluted per share computation 42,116,480 10,176,702 87,899,588 Net loss per share, basic and diluted $ (0.06) $ (0.17) $ (0.17) Potentially dilutive securities that were not included in the diluted per share calculations because they would be anti-dilutive were as follows: Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Stock options 12,173,640 12,974,400 7,510,040 12,339,017 Restricted stock units — — — 229,418 Preferred shares, Series A 30,525,040 30,525,040 30,525,040 — Preferred shares, Series A-1 6,764,960 6,764,960 6,764,960 — Preferred shares, Series B 17,955,840 17,955,840 17,955,840 — Preferred shares, Series C 5,102,080 6,511,400 6,511,400 — Preferred shares, Series C-1 26,131,880 52,407,360 52,407,360 — |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The domestic and foreign components of income before provision for (benefit from) income taxes consisted of the following (in thousands): Year Ended December 31, 2019 2020 Domestic $ (125,014) $ (5,274) International 324 4,676 Loss before income taxes $ (124,690) $ (598) The provision for (benefit from) income taxes consisted of the following (in thousands): Year Ended December 31, 2019 2020 Current: Federal and Foreign $ 270 $ 1,113 State 34 90 Total current tax expense 304 1,203 Deferred: Federal and Foreign (691) 628 State 2 1 Total deferred tax expense (689) 629 (Benefit from) provision for income taxes $ (385) $ 1,832 The following table presents the reconciliation of the statutory federal income tax rate to our effective tax rate: Year Ended December 31, 2019 2020 Tax at federal statutory rate 21.0 % 21.0 % Foreign and state income taxes 1.9 % 110.3 % Permanent differences (11.5) % (186.3) % Change in valuation allowance (9.3) % (447.8) % Research and development tax credit — % 192.7 % Return to provision adjustments (0.1) % (18.5) % Other, net (1.8) % 22.6 % Effective tax rate 0.3 % (306.2) % Deferred Tax Assets and Liabilities Significant components of the Company’s deferred tax assets and liabilities are as follows (in thousands): Year Ended December 31, 2019 2020 Deferred tax assets: Net operating loss carryforward $ 16,234 $ 12,156 Deferred revenue 9,639 16,007 Stock-based compensation 2,843 2,838 Operating lease liabilities 1,729 2,521 Research and development tax credit — 1,151 Other 514 429 Gross deferred tax assets 30,959 35,102 Less: Valuation allowances (19,169) (21,862) Total deferred tax assets $ 11,790 $ 13,240 Deferred tax liabilities: Deferred commissions $ (5,642) $ (7,398) Property, equipment and intangible assets (3,598) (2,918) Operating lease right of use assets, net (1,853) (2,440) Other (61) (361) Total deferred tax liabilities (11,154) (13,117) Net deferred tax assets $ 636 $ 123 At each reporting date, the Company has established a valuation allowance against its U.S. net deferred tax assets due to the uncertainty surrounding the realization of those assets. The Company periodically evaluates the recoverability of the deferred tax assets by assessing the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets. When it is determined to be more-likely-than-not that the deferred tax assets are realizable, the valuation allowance is reduced. As of December 31, 2020, the Company’s German subsidiary entered into a three-year cumulative loss position, which is considered to be a significant piece of objective negative evidence. Based on this evaluation, the Company recorded a full valuation allowance equal to its German deferred tax assets. During the years ended December 31, 2019 and 2020 the valuation allowance increased by $11.9 million and $2.7 million, respectively. The increase in the valuation allowance during the year ended December 31, 2019 was primarily driven by losses generated in the United States and the increase in the valuation allowance during the year ended December 31, 2020 resulted from losses generated in the United States and Germany. As of December 31, 2019 and 2020, the Company had indefinite-lived federal net operating loss carryforwards of $64.9 million and $41.3 million, respectively, which may be available to offset future taxable income for federal income tax purposes. As of December 31, 2019 and 2020, net operating loss carryforwards for state income tax purposes of $50.3 million and $33.8 million, respectively, that will begin to expire in 2022 if not utilized. As of December 31, 2020 the Company’s research and development tax credit carryforward was $1.2 million. This tax credit was established in 2020 and if not used will expire in 2037. The Company computes its interim, year-to-date provision for income taxes by applying the estimated annual effective tax rate to year-to-date pretax income or loss and adjusts the provision for discrete tax items recorded in the period. Each quarter the Company updates its estimated annual effective tax rate and makes a cumulative adjustment if the estimated annual tax rate has changed. For the nine months ended September 30, 2020 and 2021, the Company reported tax expense of $0.3 million and $1.8 million, respectively. The tax expense for both interim periods was primarily attributable to taxes generated on operating income earning in foreign jurisdictions along with U.S. state tax expense. As of September 30, 2021, the Company has a full valuation allowance on its U.S. federal and state and certain foreign deferred tax assets. Unrecognized Tax Benefits and Other Considerations The Company records liabilities related to its uncertain tax positions. The Company recognizes the tax benefit of an uncertain tax position only if it is more likely than not that the position is sustainable upon examination by the taxing authority, based on the technical merits. The tax benefit recognized is measured as the largest amount of benefit which is greater than 50 percent likely to be realized upon settlement with the taxing authority. The Company did not have any unrecognized tax benefits as of December 31, 2019 and 2020. |
Commitment and Contingencies
Commitment and Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company is subject to various legal proceedings and claims arising in the ordinary course of business. The Company establishes accruals for specific legal proceedings when it is considered probable that a loss has been incurred and the amount of the loss can be reasonably estimated. Accruals for loss contingencies are reviewed periodically and adjusted as additional information becomes available. If a loss is not both probable and reasonably estimable, or if an exposure to loss exists in excess of the amount accrued, the Company assesses whether there is at least a reasonable possibility that a loss, or additional loss, may have been incurred. If there is a reasonable possibility that a loss, or additional loss, may have been incurred, the Company discloses the estimate of the possible loss or range of loss, or states that such an estimate cannot be made. The evaluation as to whether a loss is reasonably possible or probable is based on the Company’s assessment, in conjunction with legal counsel, regarding the ultimate outcome of the matter. The Company believes that it has adequately accrued for the potential impact of loss contingencies that are probable and reasonably estimable. The Company does not believe that the ultimate resolution of any matters to which the Company is presently a party will have a material adverse effect on its consolidated results of operations, financial condition or cash flows. However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect on the Company’s consolidated results of operations, financial condition or cash flows. Legal costs are expensed as incurred. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On October 20, 2021, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with various entities representing SecurityAdvisor Technologies, Inc., collectively referred to as “SecurityAdvisor”. Under the terms of the Merger Agreement, SecurityAdvisor will become a wholly owned subsidiary of KnowBe4 (the “Acquisition”). The aggregate consideration for the Acquisition will be approximately $80.0 million, subject to post-closing adjustments based on customary purchase price adjustments for cash, net working capital and indebtedness, including transaction expenses incurred in conjunction with the Acquisition. Acquisition consideration consists of approximately $50.0 million of consideration paid upfront and an additional approximately $30.0 million of future incentive payments and restricted stock units. The Acquisition closed on November 1, 2021 and the upfront portion of total consideration was funded using $22.5 million of cash on hand and $27.5 million worth of shares of the Company’s Class A common stock. Additionally, approximately $15.0 million of potential future earn-out provisions payable through a combination of Class A common stock and cash. KnowBe4 also issued restricted stock units with an aggregate fair market value of approximately $15.0 million to certain employees of SecurityAdvisor, which will be subject to vesting conditions based on the employees’ continued employment with KnowBe4 along with certain future performance targets. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The Company’s consolidated financial statements and accompanying notes include the accounts of the Company and its wholly-owned subsidiaries and have been prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”). All intercompany balances and transactions have been eliminated in consolidation. Certain prior period amounts within the accompanying consolidated balance sheets reflect an immaterial error correction and have been reclassified. The consolidated balance sheets as of December 31, 2020 and 2019 differ from the previously filed Form S-1 as they reflect an adjustment to reclassify amounts from noncurrent deferred revenue to current deferred revenue. |
Consolidation | The accompanying interim consolidated balance sheet as of September 30, 2021, the consolidated statements of operations, stockholder’s equity, and cash flows for the nine months ended September 30, 2020 and 2021 are unaudited. These interim consolidated financial statements have been prepared on a basis consistent with the annual consolidated financial statements and, in the opinion of management, include all adjustments necessary to fairly state our financial position as of September 30, 2021 and the results of our operations and cash flows for the nine months ended September 30, 2020 and 2021. The financial data and other financial information disclosed in the notes to these consolidated financial statements related to the nine month periods are also unaudited. The results for the nine months ended September 30, 2021 are not necessarily indicative of the operating results expected for the year ending December 31, 2021 or any future period. |
Use of Estimates | The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the Company’s consolidated financial statements and accompanying notes. Estimates and assumptions used by management primarily affect revenue recognition, deferred commissions, business combinations, common stock valuations and stock-based compensation expense. These estimates are based on information available as of the date of the consolidated financial statements. On an ongoing basis, the Company evaluates these assumptions, judgments and estimates. Actual results may differ materially from these estimates. |
Operating Segments | The Company operates as a single operating segment, which engages in the development, marketing, and sale of the Company’s SaaS-based security awareness platform. Operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and assess performance. The Company’s chief operating decision maker is the Chief Executive Officer, who is responsible for evaluating the Company’s financial results, evaluating the Company’s resources and assessing the performance of the operations on a consolidated basis. |
Cash and Cash Equivalents | The Company considers all investments purchased with an original maturity of 90 days or less to be cash equivalents. Cash and cash equivalents include $29.9 million, $22.5 million and $26.3 million of overnight money market mutual funds at December 31, 2019, December 31, 2020 and September 30, 2021, respectively. The carrying amount of such cash equivalents approximates their fair value due to the short-term and highly liquid nature of these instruments. |
Accounts Receivable | Accounts receivable represents amounts owed to the Company for subscriptions to the Company’s platform and unbilled receivables representing the Company’s unconditional right to consideration for subscription contracts for which revenue has been earned in excess of the amount invoiced. Accounts receivable balances are recorded at the invoiced amount and are non-interest bearing.The Company maintains an allowance for doubtful accounts based on future expected credit losses measured over the contractual term of the receivable. Management regularly reviews the adequacy of the allowance for doubtful accounts by considering various factors including the age of each outstanding invoice, each customer’s expected ability to pay, historical loss rates and expectations of forward-looking loss estimates to determine whether the allowance is appropriate. The Company writes off accounts receivable balances to the allowance for doubtful accounts when the Company has exhausted all collection efforts. |
Deferred Commissions and Revenue Recognition | The Company capitalizes sales commissions and associated payroll taxes paid to internal sales personnel that are considered incremental costs to acquire a customer contract. These costs are classified as deferred commissions on the consolidated balance sheets. Sales commissions related to an initial subscription contract are considered incremental to the acquisition of the customer contract to the extent that they exceed commissions earned on renewal sales. Sales commissions related to the renewal of a subscription contract are not considered commensurate with the commissions paid for the acquisition of the initial subscription contract given the substantive difference in commission rate between new and renewal contracts. The portion of commissions paid upon the initial acquisition of a contract that are incremental to acquisition of the customer contract are amortized over an estimated period of benefit of six years. The portion of commissions paid upon initial acquisition that are commensurate with those paid on a renewal contract and commissions paid related to renewal contracts are amortized over the average length of the related revenue contract. An estimate of the portion of commissions related to the downloadable content performance obligation is made, which is recognized at contract inception consistent with the pattern of revenue recognition. The estimated period of benefit for commissions paid for the acquisition of the initial subscription contract is determined based on qualitative and quantitative factors including the initial estimated customer life, the technological life of the Company’s platform and related significant features, customer attrition and industry practices. Amortization of deferred sales commissions is included in sales and marketing expense in the accompanying consolidated statements of operations. The Company derives substantially all of its revenue from subscription services fees paid by customers for access to the Company’s cloud-based platform and content. The Company applies the following five-step approach for considering contracts: • identification of the contract, or contracts, with the customer; • identification of the performance obligations in the contract; • determination of the transaction price; • allocation of the transaction price to the performance obligations in the contract; and • recognition of revenue when, or as, the Company satisfies a performance obligation. The Company recognizes revenue at the time the related performance obligation is satisfied by transferring the service to a customer in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services, net of any sales or other tax. The Company’s subscription contracts typically vary from one year to three years and are generally noncancellable and nonrefundable. Subscription service revenue consists of subscription fees earned from providing access to the Company’s cloud-based platform, including support services and feature upgrades, if and when available. The Company’s cloud-based platform also includes training content which can be downloaded by the customer during their subscription term. The subscription service contracts do not provide customers with the right to take possession of the software operating on the cloud platform and, as a result, are accounted for as service arrangements. Access to the platform represents a series of distinct services that the Company continually provides access to, which fulfills its obligation to the end customer over the subscription term. This series of distinct services represents a single performance obligation that is satisfied over time. Accordingly, the amounts invoiced related to the ratable portion of subscription revenue are recorded as deferred revenue and recognized on a straight-line basis over the contract term, beginning on the date that the service is made available to the customer. Amounts expected to be recognized within one year of the balance sheet date are classified within current liabilities and the remaining portion is classified in long-term liabilities. The customers’ ability to access and download content throughout their subscription term is considered distinct and accounted for as a separate performance obligation. The portion of the transaction price allocated to the downloadable content performance obligation is recognized as revenue at contract inception when the customer gains access to downloadable content. |
Property and Equipment, Net | Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets, as follows: Computers and equipment 3 years Furniture and fixtures 5 - 7 years Leasehold improvements shorter of lease term or 5 years |
Capitalized Software and Content, Net | The Company capitalizes costs incurred related to the development of internal use software during the application development stage. These capitalized costs are primarily related to the development of the Company’s security awareness platform. Costs are capitalized to develop new internal use software or to significantly increase the functionality of existing software. Capitalized software costs are amortized on a straight-line basis over the software’s estimated useful life of two The Company also capitalizes costs related to the production of its training content, which includes interactive modules, movie series, videos, games and other content. Costs associated with the production of content, including development costs, direct costs and production overhead, are capitalized. Capitalized content is amortized over the estimated period of use, which generally ranges from two |
Goodwill and Intangible Assets | Goodwill represents the excess of the purchase price in a business combination over the estimated fair value of identifiable net assets acquired. The Company evaluates and tests the recoverability of goodwill for impairment at least annually, on October 1, or more frequently if circumstances indicate that goodwill may not be recoverable. The Company performs the impairment testing by first assessing qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of its single reporting unit is less than its carrying amount. In assessing the qualitative factors, the Company considers the impact of certain key factors including macroeconomic conditions, industry and market considerations, changes in management, litigation or regulatory matters, changes in enterprise value, and overall financial performance. If, after assessing the totality of events or circumstances, the Company determines it is more likely than not that the fair value of the reporting unit is less than its carrying amount, the Company calculates the estimated fair value of the reporting unit and any excess of the carrying amount over fair value is recognized as a goodwill impairment loss. Based on the results of the qualitative goodwill impairment analyses, the Company has determined there were no triggering events indicating impairment of goodwill during the years ended December 31, 2019 and 2020 or the nine months ended September 30, 2020 and 2021. Intangible assets consist of both definite-lived intangible assets, primarily acquired training content, customer relationship assets, patents, trademarks and domain names, and indefinite-lived trade name intangible assets. Definite-lived intangible assets are amortized on a straight-line basis over their estimated useful lives, as follows: Acquired content 3 - 4 years Customer relationships 4 - 6 years Other Intangibles 3 - 10 years Patents 20 years |
Impairment of Intangible and Other Long-Lived Assets | The Company performs an impairment review of long-lived assets, including property and equipment and both definite and indefinite-lived intangible assets, whenever events or changes in circumstances indicate that the carrying value may not be recoverable, in accordance with the respective accounting standards. If the Company determines that the carrying value of an asset group may not be recoverable, the Company measures recoverability by comparing the carrying amount of the asset group to the future undiscounted cash flows it expects the asset group to generate. If the Company considers any of these assets to be impaired, the impairment to be recognized equals the amount by which the carrying value of the asset exceeds its fair value. In addition, the Company periodically evaluates the estimated remaining useful lives of long-lived assets to determine whether events or changes in circumstances warrant a revision to the remaining period of depreciation or amortization. |
Leases | The Company determines whether an arrangement is or contains a lease at inception and classifies its leases at commencement. Operating leases with initial terms of twelve months or greater are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities in the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying assets over the term of the lease and lease liabilities represent the Company’s contractual obligation to make lease payments over the lease term. Operating lease ROU assets and lease liabilities are recognized at the commencement date based on the present value of the lease payments over the lease term. Operating lease ROU assets also include any unamortized initial direct costs and any prepayments less any unamortized lease incentives received. As the Company’s leases do not provide an implicit rate for use in determining the present value of future payments, the Company uses its incremental borrowing rate. Options to extend or terminate a lease are included in the ROU asset and lease liability when it is reasonably certain that the Company will exercise the option. |
Income Taxes | The Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on temporary differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse. The Company’s tax positions are subject to income tax audits by certain tax jurisdictions throughout the world. The Company recognizes the tax benefit of an uncertain tax position only if it is more likely than not that the position will be sustainable upon examination by the taxing authority. The tax benefit recognized is measured as the largest amount of benefit which is greater than 50 percent likely to be realized upon settlement with the taxing authority. The Company recognizes interest accrued and penalties related to unrecognized tax benefits in the income tax (benefit) provision. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts that are more likely than not expected to be realized based on the weighting of positive and negative evidence. Future realization of deferred tax assets ultimately depends on the existence of sufficient taxable income of the appropriate character (for example, ordinary income or capital gain) within the carryback or carryforward periods available under the applicable tax law. The Company regularly reviews the deferred tax assets for recoverability based on historical taxable income, projected future taxable income, the expected timing of the reversals of existing temporary differences and tax planning strategies. The Company’s judgments regarding future profitability may change due to many factors, including future market conditions and the ability to successfully execute its business plans and/or tax planning strategies. Should there be a change in the ability to recover deferred tax assets, the tax provision would increase or decrease in the period in which the assessment is changed. |
Foreign Currency Transactions | The functional currency of the Company’s subsidiaries is determined based on the primary economic environment in which the subsidiary operates. Assets and liabilities of its non-U.S. dollar functional currency subsidiaries are translated into U.S. dollars using exchange rates in effect at the end of each period and revenues and expenses are translated at the average exchange rate for the period. Gains and losses from these translations are recognized as cumulative translation adjustments and included in accumulated other comprehensive loss. The Company remeasures monetary assets and liabilities that are not denominated in the functional currency at average exchange rates in effect during each period. Gains and losses from these remeasurement adjustments are recognized within other income. |
Cost of Revenue | Cost of revenues consists of certain direct costs associated with delivering the Company’s platform and includes hosting fees as well as amortization of capitalized internal-use software and content and allocated overhead. Cost of revenues also includes personnel costs, including salaries, benefits, bonuses, and stock-based compensation, for employees who provide support services to customers. |
Stock-Based Compensation | The Company accounts for stock-based awards, including restricted stock units (“RSUs”) and stock options, based on the awards’ estimated grant date fair value. The grant date fair value of RSUs is measured at the grant date closing stock price and expense is recognized on a straight-line basis over the requisite service period of the awards and forfeitures are accounted for as incurred. The Company estimates the fair value of its stock options using the Black-Scholes option-pricing model. The determination of the grant date fair value using an option-pricing model is affected by the estimated fair value of the Company’s common stock as well as assumptions regarding a number of other complex and subjective variables. These variables include: • Fair Value of Common Stock - Prior to the Company’s IPO, because the Company’s common stock was not yet publicly traded, the Company estimated the fair value of common stock, as discussed below. • Expected Term - The expected term is estimated using the simplified method, due to a lack of historical exercise activity. The simplified method calculates the expected term as the mid-point of the vesting date and the contractual expiration date of the award. • Volatility - Since the Company does not have a trading history of its common stock, the expected volatility is determined based on the historical stock volatilities of comparable companies. Comparable companies consist of public companies in the industry, which are similar in size, stage of life cycle and financial leverage. The Company intends to continue to apply this process using the same or similar public companies until a sufficient amount of historical information regarding the volatility of its own share price becomes available, or until circumstances change such that the identified companies are no longer similar, in which case, more suitable companies whose share prices are publicly available would be used in the calculation. • Risk-Free Interest Rate - The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the date closest to the grant date for U.S. Treasury zero-coupon issues with maturities approximating the expected term of the awards. • Dividend Yield - The expected dividend assumption is based on the Company’s current expectations about its anticipated dividend policy. As the Company has a history of only paying a single one-time dividend and does not anticipate paying dividends in the future, the Company uses an expected dividend yield of zero. The resulting fair value is recognized on a straight-line basis, net of forfeitures, which are recorded as incurred, over the requisite service period. Prior to the Company’s IPO, the Company’s board of directors exercised judgment and considered numerous objective and subjective factors to determine the best estimate of the fair value of our common stock including (i) valuations performed at or near the time of grant; (ii) rights, preferences, and privileges of our redeemable convertible preferred stock relative to those of our common stock; (iii) our actual operating and financial performance at the time of the option grant; (iv) likelihood of achieving a liquidity event, such as an initial public offering or a merger or acquisition of our business; (v) the value of comparable companies with respect to industry, business model, stage of growth, financial risk or other factors; (vi) our stage of development and future financial projections; (vii) market transactions at or near the time of grant; and (viii) the lack of marketability of our common stock. The Company has historically utilized unrelated third-party specialists to prepare valuations in accordance with the American Institute of Certified Public Accountants Practice Guide, Valuation of Privately-Held-Company Equity Securities Issued as Compensation , or AICPA Guide. Prior to the Company’s IPO, the Company used the Probability Weighted Expected Return Method (“PWERM”), method for estimating the Company’s common stock value, since this is the preferred method for a company expecting a liquidity event in the near future. PWERM involves a forward-looking analysis of the possible future outcomes of the enterprise. Discrete future outcomes considered under the PWERM included an IPO as well as non-IPO market-based outcomes. Determining the fair value of the enterprise using the PWERM required the Company to develop assumptions and estimates for both the probability of an IPO liquidity event and non-IPO outcomes, as well as the values the Company expected those outcomes could yield. After the equity value is determined and allocated to the various classes of shares, a discount for lack of marketability (“DLOM”), is applied to arrive at the fair value of common stock based on the theory that as an owner of a private company stock, the stockholder has limited opportunities to sell this stock and any such sale would involve significant transaction costs, thereby reducing overall fair market value. Following the IPO, there is an active market for the Company’s Class A common stock, and the Company is no longer applying these valuation approaches. |
401(k) Plan | The Company maintains a tax-qualified retirement plan, or the 401(k) plan, that provides eligible employees with an opportunity to save for retirement on a tax-advantaged basis. Eligible employees are able to participate in the 401(k) plan as of the first day of the month following the date they meet the 401(k) plan’s eligibility requirements, and participants are able to defer up to 100% of their eligible compensation subject to applicable annual Internal Revenue Code limits. All participants’ interests in their deferrals are 100% vested when contributed and the Company’s matching contributions are 100% vested following one year of service. The Company contracted with a third-party provider to act as a custodian and trustee, and to process and maintain the records of participant data. |
Advertising | Advertising costs are expensed as incurred. |
Research and Development Costs | Research and development costs are expensed when incurred, except for certain internal-use software development costs, which may be capitalized as noted above. Research and development expenses consist primarily of personnel and related headcount costs, costs of professional services associated with the ongoing development of the Company’s technology, and allocated overhead and are recorded within technology and development expense in the accompanying consolidated statements of operations. |
Net Loss per Share | Basic and diluted net loss per share is presented in conformity with the two-class method required for participating securities. Prior to the IPO, the Company considered all series of its convertible preferred stock to be participating securities. Net loss was not allocated to the convertible preferred stock as the holders of the convertible preferred stock do not have a contractual obligation to share in any losses. Since the completion of the IPO, the Company considers shares of Class B common stock to be participating securities, since each share of Class B common stock is convertible into one share of Class A common stock at the option of the holder. Net income is attributed to common stockholders and participating securities based on their participation rights. Basic net loss per share is computed by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by giving affect to all potentially dilutive common stock equivalents to the extent they are dilutive. As the Company has reported losses for all periods presented, all potentially dilutive securities are antidilutive and, accordingly, basic net loss per share equals diluted net loss per share. |
Business Combinations | The Company includes the results of operations of the businesses that it acquires as of the respective dates of acquisition. The Company allocates the fair value of the purchase price of its acquisitions to the assets acquired and liabilities assumed based on their estimated fair values at the date of acquisition. The excess of the fair value of the purchase price over the fair values of these identifiable assets and liabilities is recorded as goodwill. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. Significant estimates in valuing certain intangible assets include, but are not limited to, future expected cash flows from acquired users, acquired technology, the value of trade names from a market participant perspective, useful lives and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and, as a result, actual results may differ from estimates. During the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the fair value of assets acquired and liabilities assumed. Upon conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the Company’s consolidated statement of operations. |
Concentrations of Credit Risk and Significant Customers | The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company’s cash deposits typically exceed the federally insured limits. Collateral is not required for accounts receivable. |
Fair Value Measurement | Assets and liabilities recorded at fair value in the consolidated financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. The lowest level of significant input determines the placement of the fair value measurement within the following hierarchical levels: • Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. • Level 2: Other inputs that are directly or indirectly observable in the marketplace. • Level 3: Unobservable inputs which are supported by little or no market activity. |
Recent Accounting Pronouncements | Recently Adopted Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, (“ASU 2016-13”), which changes the impairment model for most financial assets, and requires the use of an expected loss model in place of the currently used incurred loss method. Under this model, entities will be required to estimate the lifetime expected credit loss on such instruments and record an allowance to offset the amortized cost basis of the financial asset, resulting in a net presentation of the amount expected to be collected on the financial asset. The update to the standard is effective for interim and annual periods beginning after December 15, 2019. The Company adopted ASU 2016-13 on January 1, 2020 and the impact of adoption was not material to the Company’s consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other – Simplifying the Test for Goodwill Impairment, (“ASU 2017-04”), which eliminates the requirement to calculate the implied fair value of an entity to measure a goodwill impairment charge. Instead, an entity will record an impairment charge based on the excess of the entity’s qualitative assessment when the results indicate that it is more likely than not that the fair value is greater than its carrying amount and the quantitative impairment test will not be performed. The accounting standard is effective for the Company beginning January 1, 2022, with early adoption permitted. The Company adopted ASU 2017-04 on January 1, 2020 with no impact to the consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (ASC Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement, (“ASU 2018-13”), which modifies the disclosure requirements on fair value measurements in ASC Topic 820. After the adoption of ASU 2018-13, an entity will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy; the policy for timing of transfers between levels; the valuation processes for Level 3 fair value measurements; and, for nonpublic entities, the changes in unrealized gains and losses for the period included in earnings for recurring Level 3 fair value measurements held at the end of the reporting period. This ASU is effective for all entities for annual and interim periods in fiscal years beginning after December 15, 2019, with early adoption permitted. The Company adopted ASU 2018-13 on January 1, 2020 and the impact of adoption was not material to the Company's consolidated financial statements. In March 2019, the FASB issued ASU 2019-02, Improvements to Accounting for Costs of Films and License Agreements for Program Materials, (“ASU 2019-02”), in order to align the accounting for production costs of an episodic television series with the accounting for production costs of films by removing the content distinction for capitalization. ASU 2019-02 also requires that an entity reassess estimates of the use of a film in a film group and account for any changes prospectively. In addition, ASU 2019-02 requires that an entity test films and license agreements for program material for impairment at a film group level when the film or license agreements are predominantly monetized with other films and license agreements. ASU 2019-02 is effective for fiscal years beginning after December 15, 2019 and early adoption is permitted. The Company adopted ASU 2019-02 on January 1, 2020 and the impact of adoption was not material to the Company’s consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, (“ASU 2019-12”), which removes certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-12 also amends other aspects of the guidance to help simplify and promote consistent application of US GAAP. The guidance is effective for interim and annual periods beginning after December 15, 2020, with early adoption permitted. The Company adopted ASU 2019-12 on January 1, 2021 and the adoption was not material to the Company’s consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Schedule of Property and Equipment Useful Lives | Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets, as follows: Computers and equipment 3 years Furniture and fixtures 5 - 7 years Leasehold improvements shorter of lease term or 5 years Property and equipment, net consists of the following (in thousands): December 31, 2019 December 31, 2020 September 30, (unaudited) Leasehold improvements $ 6,945 $ 9,143 $ 8,541 Computer and other equipment 4,111 5,630 6,566 Furniture and fixtures 1,411 2,107 2,101 12,467 16,880 17,208 Less: Accumulated depreciation (3,727) (6,596) (8,091) Total property and equipment, net $ 8,740 $ 10,284 $ 9,117 |
Schedule of Finite-Lived Intangible Assets | Definite-lived intangible assets are amortized on a straight-line basis over their estimated useful lives, as follows: Acquired content 3 - 4 years Customer relationships 4 - 6 years Other Intangibles 3 - 10 years Patents 20 years Intangible assets, net consist of the following (in thousands): Weighted Average Amortization Period December 31, 2019 Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) Acquired content and customer relationships (1) 4.8 years $ 2,284 $ (1,673) $ 611 Domain names 1.7 years 204 (97) 107 Patents 18.9 years 337 (18) 319 Trade names and other indefinite-lived intangibles (1) Indefinite 455 — 455 In-process patents and trademarks Not applicable 1,001 — 1,001 Total intangible assets $ 4,281 $ (1,788) $ 2,493 Weighted Average Amortization Period December 31, 2020 Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) Acquired content and customer relationships (1) 3.7 years $ 2,268 $ (1,859) $ 409 Domain names 1.3 years 245 (156) 89 Patents 19.1 years 1,235 (46) 1,189 Trade names and other indefinite-lived intangibles (1) Indefinite 425 — 425 In-process patents and trademarks Not applicable 873 — 873 Total intangible assets $ 5,046 $ (2,061) $ 2,985 Weighted Average Amortization Period September 30, 2021 (unaudited) Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) Acquired content and customer relationships (1) 4.7 years $ 7,145 $ (2,512) $ 4,633 Domain names 2.1 years 258 (204) 54 Patents 18.7 years 1,687 (98) 1,589 Trade names and other indefinite-lived intangibles (1) Indefinite 716 — 716 In-process patents and trademarks Not applicable 1,176 — 1,176 Total intangible assets $ 10,982 $ (2,814) $ 8,168 _______________ (1) - Gross carrying amount includes impact of translation of foreign denominated intangible assets |
Schedule of Fair Value of Financial Assets and Liabilities | The following tables present information about the Company’s financial assets and liabilities that are measured at fair value and indicate the fair value hierarchy of the valuation inputs used (in thousands): December 31, 2019 Quoted Prices in Active Markets for Identical Assets Significant Other Significant Total Assets: Cash equivalents: Money market mutual funds $ 29,944 $ — $ — $ 29,944 Total assets $ 29,944 $ — $ — $ 29,944 Liabilities: Accounts payable and accrued expenses: Business acquisition contingent liabilities $ — $ — $ 907 $ 907 Total liabilities $ — $ — $ 907 $ 907 December 31, 2020 Quoted Prices in Active Markets for Identical Assets Significant Other Significant Total Assets: Cash equivalents: Money market mutual funds $ 22,479 $ — $ — $ 22,479 Total assets $ 22,479 $ — $ — $ 22,479 Liabilities: Accounts payable and accrued expenses: Business acquisition contingent liabilities $ — $ — $ 350 $ 350 Total liabilities $ — $ — $ 350 $ 350 |
Revenue, Deferred Revenue and_2
Revenue, Deferred Revenue and Remaining Performance Obligations (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Customer Revenue by Type | The following table summarizes revenue recognized from performance obligations delivered to customers which relate to (i) subscription services which is recognized ratably over the term of the contract and (ii) initial subscription revenue representing content available for download which is recognized at a point in time, as follows (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Ratable portion of subscription revenue $ 100,084 $ 148,977 $ 107,435 $ 151,084 Subscription revenue allocated to downloadable content 20,491 25,909 18,164 25,907 Total $ 120,575 $ 174,886 $ 125,599 $ 176,991 |
Schedule of Customer Revenue by Region | The following table summarizes the revenue by region based on the shipping address of customers who have contracted to use the Company’s platform (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) North America $ 108,835 $ 154,131 $ 111,596 $ 149,744 International 11,740 20,755 14,003 27,247 Total $ 120,575 $ 174,886 $ 125,599 $ 176,991 |
Schedule of Changes in Deferred Revenue | Contract liabilities consist of deferred revenue which represents contractual billings made in advance of performance under the contract. Changes in deferred revenue were as follows (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Beginning balance $ 83,676 $ 138,990 $ 138,990 $ 185,696 Plus: Additions to deferred revenue 175,636 221,671 156,221 231,869 Less: Recognition of revenue deferred in the prior year (59,682) (98,657) (81,456) (112,460) Less: Recognition of revenue deferred in the current year (60,640) (76,308) (44,143) (64,531) Ending balance $ 138,990 $ 185,696 $ 169,612 $ 240,574 |
Schedule of Remaining Performance Obligations | Remaining performance obligations consisted of the following (in thousands): December 31, 2019 December 31, 2020 September 30, (unaudited) Current $ 98,777 $ 136,382 $ 183,117 Noncurrent 64,058 87,395 111,699 Total $ 162,835 $ 223,777 $ 294,816 |
Schedule of Changes in Deferred Commissions | Changes in deferred commissions were as follows (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Beginning balance $ 19,080 $ 29,176 $ 29,176 $ 37,199 Plus: Additions to deferred commissions 22,375 22,161 15,427 23,112 Less: Recognition of deferred commissions (12,279) (14,238) (10,402) (13,806) Plus: Foreign currency impacts on deferred commissions — 100 (4) (92) Ending balance $ 29,176 $ 37,199 $ 34,197 $ 46,413 |
Business Combinations (Tables)
Business Combinations (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the fair values of the assets acquired and liabilities assumed as of the date of each acquisition (in thousands): Tangible net assets $ 895 Developed technology and content 620 Trade name 190 Customer relationships 60 Goodwill 4,852 Total net asset value $ 6,617 The following table summarizes the fair values of the assets acquired and liabilities assumed as of the acquisition date (in thousands): Accounts receivable $ 1,391 Other assets acquired 4,171 Trade name 300 Acquired content 1,600 Customer relationships 3,300 Deferred revenue (3,919) Other liabilities acquired (3,172) Total identifiable net assets assumed 3,671 Goodwill 34,243 Total net asset value $ 37,914 |
Capitalized Software and Cont_2
Capitalized Software and Content, Net (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule Of Capitalized Computer Software And Content | Internally developed capitalized software and content, net consists of the following (in thousands): December 31, 2019 December 31, 2020 September 30, (unaudited) Capitalized software $ 12,628 $ 15,081 $ 16,198 Capitalized content 11,834 16,899 20,886 24,462 31,980 37,084 Less: Accumulated amortization (8,439) (16,457) (22,559) Total capitalized software and content, net $ 16,023 $ 15,523 $ 14,525 |
Schedule of Estimated Future Capitalized Software and Content Amortization Expense | As these costs are not yet in service, they are not included in the following estimated future amortization expenses for capitalized software and content placed in service at the balance sheet dates shown below (in thousands): December 31, September 30, (unaudited) 2021 $ 7,033 $ 1,937 2022 3,941 5,684 2023 1,033 2,740 2024 153 938 2025 153 537 Thereafter 196 702 Total $ 12,509 $ 12,538 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment, Net | Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets, as follows: Computers and equipment 3 years Furniture and fixtures 5 - 7 years Leasehold improvements shorter of lease term or 5 years Property and equipment, net consists of the following (in thousands): December 31, 2019 December 31, 2020 September 30, (unaudited) Leasehold improvements $ 6,945 $ 9,143 $ 8,541 Computer and other equipment 4,111 5,630 6,566 Furniture and fixtures 1,411 2,107 2,101 12,467 16,880 17,208 Less: Accumulated depreciation (3,727) (6,596) (8,091) Total property and equipment, net $ 8,740 $ 10,284 $ 9,117 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Indefinite-Lived Intangible Assets | Intangible assets, net consist of the following (in thousands): Weighted Average Amortization Period December 31, 2019 Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) Acquired content and customer relationships (1) 4.8 years $ 2,284 $ (1,673) $ 611 Domain names 1.7 years 204 (97) 107 Patents 18.9 years 337 (18) 319 Trade names and other indefinite-lived intangibles (1) Indefinite 455 — 455 In-process patents and trademarks Not applicable 1,001 — 1,001 Total intangible assets $ 4,281 $ (1,788) $ 2,493 Weighted Average Amortization Period December 31, 2020 Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) Acquired content and customer relationships (1) 3.7 years $ 2,268 $ (1,859) $ 409 Domain names 1.3 years 245 (156) 89 Patents 19.1 years 1,235 (46) 1,189 Trade names and other indefinite-lived intangibles (1) Indefinite 425 — 425 In-process patents and trademarks Not applicable 873 — 873 Total intangible assets $ 5,046 $ (2,061) $ 2,985 Weighted Average Amortization Period September 30, 2021 (unaudited) Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) Acquired content and customer relationships (1) 4.7 years $ 7,145 $ (2,512) $ 4,633 Domain names 2.1 years 258 (204) 54 Patents 18.7 years 1,687 (98) 1,589 Trade names and other indefinite-lived intangibles (1) Indefinite 716 — 716 In-process patents and trademarks Not applicable 1,176 — 1,176 Total intangible assets $ 10,982 $ (2,814) $ 8,168 _______________ (1) - Gross carrying amount includes impact of translation of foreign denominated intangible assets |
Schedule of Finite-Lived Intangible Assets | Definite-lived intangible assets are amortized on a straight-line basis over their estimated useful lives, as follows: Acquired content 3 - 4 years Customer relationships 4 - 6 years Other Intangibles 3 - 10 years Patents 20 years Intangible assets, net consist of the following (in thousands): Weighted Average Amortization Period December 31, 2019 Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) Acquired content and customer relationships (1) 4.8 years $ 2,284 $ (1,673) $ 611 Domain names 1.7 years 204 (97) 107 Patents 18.9 years 337 (18) 319 Trade names and other indefinite-lived intangibles (1) Indefinite 455 — 455 In-process patents and trademarks Not applicable 1,001 — 1,001 Total intangible assets $ 4,281 $ (1,788) $ 2,493 Weighted Average Amortization Period December 31, 2020 Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) Acquired content and customer relationships (1) 3.7 years $ 2,268 $ (1,859) $ 409 Domain names 1.3 years 245 (156) 89 Patents 19.1 years 1,235 (46) 1,189 Trade names and other indefinite-lived intangibles (1) Indefinite 425 — 425 In-process patents and trademarks Not applicable 873 — 873 Total intangible assets $ 5,046 $ (2,061) $ 2,985 Weighted Average Amortization Period September 30, 2021 (unaudited) Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) Acquired content and customer relationships (1) 4.7 years $ 7,145 $ (2,512) $ 4,633 Domain names 2.1 years 258 (204) 54 Patents 18.7 years 1,687 (98) 1,589 Trade names and other indefinite-lived intangibles (1) Indefinite 716 — 716 In-process patents and trademarks Not applicable 1,176 — 1,176 Total intangible assets $ 10,982 $ (2,814) $ 8,168 _______________ (1) - Gross carrying amount includes impact of translation of foreign denominated intangible assets |
Schedule of Estimated Future Amortization Expense | Estimated future amortization expense is as follows (in thousands): December 31, September 30, (unaudited) 2021 $ 262 $ 296 2022 186 1,160 2023 129 1,104 2024 97 1,071 2025 97 735 Thereafter 916 1,910 Total $ 1,687 $ 6,276 |
Schedule of Changes in Carrying Amounts of Goodwill | The changes in carrying amounts of goodwill were as follows (in thousands): Balance at December 31, 2018 $ 3,817 Acquisitions 4,852 Other adjustments (1) 204 Balance at December 31, 2019 $ 8,873 Other adjustments (1) (268) Balance at December 31, 2020 $ 8,605 Acquisitions 34,243 Other adjustments (1) (241) Balance at September 30, 2021 (unaudited) $ 42,607 ________________ |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Accrued Expenses | Accounts payable and accrued expenses consisted of the following (in thousands): December 31, 2019 December 31, 2020 September 30, 2021 (unaudited) Accrued commissions $ 6,298 $ 6,662 $ 8,058 Accrued payroll 5,847 4,839 16,507 Accounts payable 3,071 2,530 3,023 Other accrued expenses 2,877 5,234 8,452 Total accounts payable and accrued expenses $ 18,093 $ 19,265 $ 36,040 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Leases [Abstract] | |
Schedule of Components of Lease Expense, Other Operating Lease Information, and Supplemental Cash Flow Information | The components of lease costs were as follows (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Operating lease cost $ 2,133 $ 2,932 $ 1,310 $ 2,712 Short-term lease cost 562 656 328 402 Variable lease cost 484 501 240 586 Total lease cost $ 3,179 $ 4,089 $ 1,878 $ 3,700 Other information related to operating and finance leases is as follows: Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Weighted-average remaining lease term (in years) 3.5 5.2 4.8 4.5 Weighted-average discount rate 7.8 % 5.6 % 6.6 % 3.8 % Supplemental cash flow information related to leases is as follows (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 2,152 $ 2,920 $ 2,079 $ 2,636 ROU assets obtained in exchange for lease obligations: Operating leases $ 2,287 $ 3,503 $ 3,224 $ 3,142 |
Schedule of Future Lease Payments Under Non-Cancellable Leases | Future lease payments under non-cancellable leases recorded as of September 30, 2021, were as follows (in thousands): Operating Leases (unaudited) 2021 $ 834 2022 3,732 2023 3,208 2024 2,576 2025 2,003 Thereafter 1,703 Total lease payments 14,056 Less: imputed interest (1,046) Total future lease payments under non-cancellable leases $ 13,010 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Schedule of Stock by Class | As of December 31, 2019 and 2020, the Company had outstanding Series A, A-1, B, C and C-1 Preferred Stock (individually referred to as “Series A, A-1, B, C or C-1” or collectively “Preferred Stock”) as follows (in thousands, except share and per share amounts): As of December 31, 2019 and 2020 Issue Price per Share Shares Authorized Issued and Outstanding Net Carrying Value Liquidation Preference Series A $ 0.26 30,525,040 30,525,040 $ 8,000 $ 8,000 Series A-1 $ 0.82 6,764,960 6,764,960 5,541 5,541 Series B $ 1.67 17,955,840 17,955,840 30,000 30,000 Series C $ 4.85 6,511,400 6,511,400 31,377 31,561 Series C-1 $ 5.90 52,407,360 52,407,360 309,015 309,400 Total 114,164,600 114,164,600 $ 383,933 $ 384,502 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Valuation Assumptions for Stock Options | The Company records compensation expense for stock options based on the estimated fair value of the options on the date of grant using the Black-Scholes option-pricing model with the assumptions set forth in the table below. Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Expected term (years) 6.3 4.0 - 6.3 5.6 6.3 Expected stock price volatility 40.0% - 45.0% 45.0% - 50.0% 48.0 % 45.0 % Risk-free interest rate 1.4% - 2.5% 0.2% - 1.7% 0.8 % 0.8 % Dividend yield — % — % — % — % Fair value of common stock $1.07 - $4.07 $4.14 - $5.84 $4.14 - $5.71 $19.82 |
Summary of Common Stock Option Activity | The following table summarizes the common stock option activity for the years ended December 31, 2019 and 2020 and for the nine months ended September 30, 2021 (unaudited): Number of Shares Weighted-Average Exercise Price Weighted-Average Grant Date Fair Value Weighted-Average Remaining Contractual Term Aggregate Intrinsic Value Options outstanding at December 31, 2018 17,101,000 $ 0.52 $ 0.20 7.5 $ 10,328 Granted 3,114,240 2.90 1.60 Exercised (1,947,760) 0.19 6,046 Repurchased (7,136,480) 0.24 Canceled, forfeited or expired (766,480) 0.98 Options outstanding at December 31, 2019 10,364,520 $ 1.47 $ 0.71 8.1 $ 18,952 Granted 5,060,720 4.93 2.22 Exercised (328,600) 0.68 3,724 Canceled, forfeited or expired (876,840) 1.92 Options outstanding at December 31, 2020 14,219,800 $ 2.73 $ 1.25 7.9 $ 131,893 Granted 40,000 12.01 11.52 312 Exercised (3,173,728) 1.84 0.71 58,274 Canceled, forfeited or expired (502,995) 4.07 1.70 8,216 Options outstanding at September 30, 2021 10,583,077 $ 2.97 $ 1.43 7.3 $ 200,938 Options vested and exercisable at September 30, 2021 7,002,237 $ 2.24 $ 1.08 6.8 $ 138,061 |
Schedule of Restricted Stock Unit Activity | The following table summarizes the RSUs activity for the for the nine months ended September 30, 2021 (unaudited): Shares Weighted-Average Grant-Date Fair Value per share Outstanding as of December 31, 2020 — $ — Granted 1,775,992 $ 16.42 Vested (954,297) $ 16.23 Forfeited or expired (5,500) $ 28.94 Outstanding as of September 30, 2021 816,195 $ 16.56 |
Schedule of Valuation Assumptions for Employee Stock Purchase Plan | The fair value of the ESPP purchase right is estimated on the grant date using the Black-Scholes option-pricing model with the following assumptions: Nine Months Ended September 30, 2021 (unaudited) Expected term (years) 0.5 Expected stock price volatility 60.9 % Risk-free interest rate 0.4 % Dividend yield — % |
Schedule of Stock-based Compensation Expense | The following table summarizes the components of stock-based compensation expense recognized in the consolidated statements of operations (in thousands): Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Cost of revenues $ 83 $ 188 $ 122 $ 253 Sales and marketing 5,750 1,579 825 7,277 Technology and development 162 896 323 530 General and administrative 112,110 2,571 1,983 15,212 Total stock-based compensation expense $ 118,105 $ 5,234 $ 3,253 $ 23,272 |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Net Loss per Share | The computation of net loss per share is as follows (in thousands, except share and per share data): Year Ended December 31, 2019 2020 Numerator: Net loss $ (124,323) $ (2,430) Less: dividend distribution allocated to preferred stockholders (3,749) — Net loss attributable to common stockholders $ (128,072) $ (2,430) Denominator: Weighted-average common shares outstanding 66,958,400 42,049,840 Net loss per share, basic and diluted $ (1.91) $ (0.06) Nine Months Ended September 30, 2020 2021 Class A Class B Numerator: Allocation of undistributed losses for basic calculation $ (2,634) $ (1,685) $ (14,558) Reallocation of undistributed losses for diluted calculation — — — Allocation of undistributed losses for diluted calculation $ (2,634) $ (1,685) $ (14,558) Denominator: Number of shares used in basic and diluted per share computation 42,116,480 10,176,702 87,899,588 Net loss per share, basic and diluted $ (0.06) $ (0.17) $ (0.17) |
Schedule of Excluded Antidilutive Securities | Potentially dilutive securities that were not included in the diluted per share calculations because they would be anti-dilutive were as follows: Year Ended December 31, Nine Months Ended September 30, 2019 2020 2020 2021 (unaudited) Stock options 12,173,640 12,974,400 7,510,040 12,339,017 Restricted stock units — — — 229,418 Preferred shares, Series A 30,525,040 30,525,040 30,525,040 — Preferred shares, Series A-1 6,764,960 6,764,960 6,764,960 — Preferred shares, Series B 17,955,840 17,955,840 17,955,840 — Preferred shares, Series C 5,102,080 6,511,400 6,511,400 — Preferred shares, Series C-1 26,131,880 52,407,360 52,407,360 — |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Schedule of Domestic and Foreign Components of Income Before Provision for (Benefit from) Income Taxes | The domestic and foreign components of income before provision for (benefit from) income taxes consisted of the following (in thousands): Year Ended December 31, 2019 2020 Domestic $ (125,014) $ (5,274) International 324 4,676 Loss before income taxes $ (124,690) $ (598) |
Schedule of Provision for (Benefit from) Income Taxes | The provision for (benefit from) income taxes consisted of the following (in thousands): Year Ended December 31, 2019 2020 Current: Federal and Foreign $ 270 $ 1,113 State 34 90 Total current tax expense 304 1,203 Deferred: Federal and Foreign (691) 628 State 2 1 Total deferred tax expense (689) 629 (Benefit from) provision for income taxes $ (385) $ 1,832 |
Schedule of Reconciliation of the Statutory Federal Income Tax Rate to Effective Tax Rate | The following table presents the reconciliation of the statutory federal income tax rate to our effective tax rate: Year Ended December 31, 2019 2020 Tax at federal statutory rate 21.0 % 21.0 % Foreign and state income taxes 1.9 % 110.3 % Permanent differences (11.5) % (186.3) % Change in valuation allowance (9.3) % (447.8) % Research and development tax credit — % 192.7 % Return to provision adjustments (0.1) % (18.5) % Other, net (1.8) % 22.6 % Effective tax rate 0.3 % (306.2) % |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred tax assets and liabilities are as follows (in thousands): Year Ended December 31, 2019 2020 Deferred tax assets: Net operating loss carryforward $ 16,234 $ 12,156 Deferred revenue 9,639 16,007 Stock-based compensation 2,843 2,838 Operating lease liabilities 1,729 2,521 Research and development tax credit — 1,151 Other 514 429 Gross deferred tax assets 30,959 35,102 Less: Valuation allowances (19,169) (21,862) Total deferred tax assets $ 11,790 $ 13,240 Deferred tax liabilities: Deferred commissions $ (5,642) $ (7,398) Property, equipment and intangible assets (3,598) (2,918) Operating lease right of use assets, net (1,853) (2,440) Other (61) (361) Total deferred tax liabilities (11,154) (13,117) Net deferred tax assets $ 636 $ 123 |
Description of Business (Detail
Description of Business (Details) | Apr. 09, 2021 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Forward stock split ratio | 40 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Narrative (Details) | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2021USD ($)purchasePeriodsegment | Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Apr. 26, 2021 | |
Cash and Cash Equivalents [Line Items] | |||||
Number of operating segments | segment | 1 | ||||
Cash and cash equivalents | $ 272,273,000 | $ 85,582,000 | $ 48,864,000 | ||
Allowance for doubtful accounts | $ 400,000 | 400,000 | 200,000 | ||
Amortization period (in years) | 6 years | ||||
Impairments of capitalized internal use software | $ 0 | $ 0 | 0 | 0 | |
Goodwill impairment | 0 | 0 | 0 | 0 | |
Intangible asset impairment | 0 | 0 | 0 | 0 | |
Long-lived asset impairment | $ 0 | 0 | 0 | 0 | |
Percentage of annual contributions per employee | 100.00% | ||||
Percentage of vested annual eligible compensation | 100.00% | ||||
Percentage of vested employer matching | 100.00% | ||||
Vesting period (in years) | 1 year | ||||
Contributions | $ 1,600,000 | 1,800,000 | 2,400,000 | 1,200,000 | |
Advertising expenses | $ 10,500,000 | $ 9,900,000 | 13,300,000 | 12,200,000 | |
Common Stock, Class B | |||||
Cash and Cash Equivalents [Line Items] | |||||
Common stock, conversion ratio | 1 | 1 | |||
Stock options | |||||
Cash and Cash Equivalents [Line Items] | |||||
Dividend yield | $ 0 | ||||
Employee Stock | |||||
Cash and Cash Equivalents [Line Items] | |||||
Percentage of payroll deduction of base cash compensation | 15.00% | ||||
Offering period (in months) | 6 months | ||||
Number of purchase periods | purchasePeriod | 1 | ||||
Purchase period (in months) | 6 months | ||||
Percentage of purchase price of common stock | 85.00% | ||||
Minimum | |||||
Cash and Cash Equivalents [Line Items] | |||||
Capitalized computer software, useful life (in years) | 2 years | ||||
Capitalized computer content, useful life (in years) | 2 years | ||||
Subscription contracts, term (in years) | 1 year | ||||
Maximum | |||||
Cash and Cash Equivalents [Line Items] | |||||
Capitalized computer software, useful life (in years) | 5 years | ||||
Capitalized computer content, useful life (in years) | 4 years | ||||
Subscription contracts, term (in years) | 3 years | ||||
Money Market Funds | |||||
Cash and Cash Equivalents [Line Items] | |||||
Cash and cash equivalents | $ 26,300,000 | 22,500,000 | 29,900,000 | ||
Money Market Funds | Fair Value, Recurring | |||||
Cash and Cash Equivalents [Line Items] | |||||
Money market mutual funds | 22,479,000 | 29,944,000 | |||
Money Market Funds | Quoted Prices in Active Markets for Identical Assets (Level 1) | Fair Value, Recurring | |||||
Cash and Cash Equivalents [Line Items] | |||||
Money market mutual funds | $ 26,300,000 | $ 22,479,000 | $ 29,944,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Useful Lives of Property and Equipment (Details) | 9 Months Ended |
Sep. 30, 2021 | |
Computers and equipment | |
Property, Plant and Equipment [Line Items] | |
Useful life (in years) | 3 years |
Furniture and fixtures | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life (in years) | 5 years |
Furniture and fixtures | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life (in years) | 7 years |
Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Useful life (in years) | 5 years |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Useful Lives of Intangible Assets (Details) | 9 Months Ended |
Sep. 30, 2021 | |
Acquired content | Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Definite-lived intangible asset, useful life (in years) | 3 years |
Acquired content | Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Definite-lived intangible asset, useful life (in years) | 4 years |
Customer relationships | Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Definite-lived intangible asset, useful life (in years) | 4 years |
Customer relationships | Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Definite-lived intangible asset, useful life (in years) | 6 years |
Other Intangibles | Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Definite-lived intangible asset, useful life (in years) | 3 years |
Other Intangibles | Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Definite-lived intangible asset, useful life (in years) | 10 years |
Patents | |
Finite-Lived Intangible Assets [Line Items] | |
Definite-lived intangible asset, useful life (in years) | 20 years |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Fair Value Measurements (Details) - Fair Value, Recurring - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Cash equivalents: | |||
Total assets | $ 22,479 | $ 29,944 | |
Accounts payable and accrued expenses: | |||
Business acquisition contingent liabilities | 350 | 907 | |
Total liabilities | 350 | 907 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Cash equivalents: | |||
Total assets | 22,479 | 29,944 | |
Accounts payable and accrued expenses: | |||
Business acquisition contingent liabilities | 0 | 0 | |
Total liabilities | 0 | 0 | |
Significant Other Observable Inputs (Level 2) | |||
Cash equivalents: | |||
Total assets | 0 | 0 | |
Accounts payable and accrued expenses: | |||
Business acquisition contingent liabilities | 0 | 0 | |
Total liabilities | 0 | 0 | |
Significant Unobservable Inputs (Level 3) | |||
Cash equivalents: | |||
Total assets | 0 | 0 | |
Accounts payable and accrued expenses: | |||
Business acquisition contingent liabilities | 350 | 907 | |
Total liabilities | 350 | 907 | |
Money market mutual funds | |||
Cash equivalents: | |||
Money market mutual funds | 22,479 | 29,944 | |
Money market mutual funds | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Cash equivalents: | |||
Money market mutual funds | $ 26,300 | 22,479 | 29,944 |
Money market mutual funds | Significant Other Observable Inputs (Level 2) | |||
Cash equivalents: | |||
Money market mutual funds | 0 | 0 | |
Money market mutual funds | Significant Unobservable Inputs (Level 3) | |||
Cash equivalents: | |||
Money market mutual funds | $ 0 | $ 0 |
Revenue, Deferred Revenue and_3
Revenue, Deferred Revenue and Remaining Performance Obligations - Disaggregation of Revenue by Timing of Service (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 176,991 | $ 125,599 | $ 174,886 | $ 120,575 |
Ratable portion of subscription revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 151,084 | 107,435 | 148,977 | 100,084 |
Subscription revenue allocated to downloadable content | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 25,907 | $ 18,164 | $ 25,909 | $ 20,491 |
Revenue, Deferred Revenue and_4
Revenue, Deferred Revenue and Remaining Performance Obligations - Revenue By Geographic Location (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 176,991 | $ 125,599 | $ 174,886 | $ 120,575 |
North America | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 149,744 | 111,596 | 154,131 | 108,835 |
International | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 27,247 | $ 14,003 | $ 20,755 | $ 11,740 |
Revenue, Deferred Revenue and_5
Revenue, Deferred Revenue and Remaining Performance Obligations - Changes in Deferred Revenue (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Activity In Contract With Customer, Liability [Roll Forward] | ||||
Beginning balance | $ 185,696 | $ 138,990 | $ 138,990 | $ 83,676 |
Plus: Additions to deferred revenue | 231,869 | 156,221 | 221,671 | 175,636 |
Less: Recognition of revenue deferred in the prior year | (112,460) | (81,456) | (98,657) | (59,682) |
Less: Recognition of revenue deferred in the current year | (64,531) | (44,143) | (76,308) | (60,640) |
Ending balance | $ 240,574 | $ 169,612 | $ 185,696 | $ 138,990 |
Revenue, Deferred Revenue and_6
Revenue, Deferred Revenue and Remaining Performance Obligations - Narrative (Details) | Sep. 30, 2021 |
Minimum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Expected timing for recognition of remaining performance obligation | 13 months |
Maximum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Expected timing for recognition of remaining performance obligation | 36 months |
Revenue, Deferred Revenue and_7
Revenue, Deferred Revenue and Remaining Performance Obligations - Remaining Performance Obligation (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Remaining performance obligation | $ 294,816 | $ 223,777 | $ 162,835 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01 | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Remaining performance obligation | $ 183,117 | 136,382 | 98,777 |
Expected timing for recognition of remaining performance obligation | 1 year | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-01 | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||
Remaining performance obligation | $ 111,699 | $ 87,395 | $ 64,058 |
Expected timing for recognition of remaining performance obligation |
Revenue, Deferred Revenue and_8
Revenue, Deferred Revenue and Remaining Performance Obligations - Changes in Deferred Commissions (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Activity In Capitalized Contract Cost, Net [Roll Forward] | ||||
Beginning balance | $ 37,199 | $ 29,176 | $ 29,176 | $ 19,080 |
Plus: Additions to deferred commissions | 23,112 | 15,427 | 22,161 | 22,375 |
Less: Recognition of deferred commissions | (13,806) | (10,402) | (14,238) | (12,279) |
Plus: Foreign currency impacts on deferred commissions | (92) | (4) | 100 | 0 |
Ending balance | $ 46,413 | $ 34,197 | $ 37,199 | $ 29,176 |
Business Combinations - Narrati
Business Combinations - Narrative (Details) | Mar. 01, 2021USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($)business |
Business Acquisition [Line Items] | |||||
Cash consideration | $ 11,227,000 | $ 0 | $ 0 | $ 4,970,000 | |
2019 Business Combinations | |||||
Business Acquisition [Line Items] | |||||
Number of businesses acquired | business | 3 | ||||
Cash consideration | $ 6,600,000 | ||||
Cash acquired | 800,000 | ||||
Contingent consideration | 1,100,000 | ||||
Amount held in escrow | 300,000 | ||||
Goodwill expected tax deductible amount | 0 | ||||
Revenues of acquirees since acquisition | 1,300,000 | ||||
Losses of acquirees since acquisition | 700,000 | ||||
Acquisition related costs | $ 300,000 | ||||
MediaPro Holdings | |||||
Business Acquisition [Line Items] | |||||
Cash consideration | $ 11,300,000 | ||||
Cash acquired | 1,900,000 | ||||
Acquisition related costs | $ 500,000 | ||||
Equity consideration | $ 24,700,000 |
Business Combinations - Fair Va
Business Combinations - Fair Value of Assets and Liabilities Acquired (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Mar. 01, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Business Acquisition [Line Items] | |||||
Goodwill | $ 42,607 | $ 8,605 | $ 8,873 | $ 3,817 | |
2019 Business Combinations | |||||
Business Acquisition [Line Items] | |||||
Tangible net assets | 895 | ||||
Goodwill | 4,852 | ||||
Total net asset value | 6,617 | ||||
2019 Business Combinations | Developed technology and content | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangible assets | 620 | ||||
2019 Business Combinations | Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangible assets | 60 | ||||
2019 Business Combinations | Trade name | |||||
Business Acquisition [Line Items] | |||||
Indefinite-lived intangible assets | $ 190 | ||||
MediaPro Holdings | |||||
Business Acquisition [Line Items] | |||||
Accounts receivable | $ 1,391 | ||||
Other assets acquired | 4,171 | ||||
Deferred revenue | (3,919) | ||||
Other liabilities acquired | (3,172) | ||||
Total identifiable net assets assumed | 3,671 | ||||
Goodwill | 34,243 | ||||
Total net asset value | 37,914 | ||||
MediaPro Holdings | Acquired content | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangible assets | 1,600 | ||||
MediaPro Holdings | Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Finite-lived intangible assets | 3,300 | ||||
MediaPro Holdings | Trade name | |||||
Business Acquisition [Line Items] | |||||
Indefinite-lived intangible assets | $ 300 |
Capitalized Software and Cont_3
Capitalized Software and Content, Net - Capitalized Computer Software And Content (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||
Capitalized software | $ 16,198 | $ 15,081 | $ 12,628 |
Capitalized content | 20,886 | 16,899 | 11,834 |
Capitalized software and content, gross | 37,084 | 31,980 | 24,462 |
Less: Accumulated amortization | (22,559) | (16,457) | (8,439) |
Total capitalized software and content, net | $ 14,525 | $ 15,523 | $ 16,023 |
Capitalized Software and Cont_4
Capitalized Software and Content, Net - Narrative (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||||
Capitalized software and content amortization expense | $ 6.2 | $ 6 | $ 8 | $ 5.6 |
Accumulated costs not yet placed in service | $ 2 | $ 3 | $ 2.1 |
Capitalized Software and Cont_5
Capitalized Software and Content, Net - Expected Amortization (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Capitalized Computer Software And Content, Future Expected Amortization Expense [Abstract] | ||
2021 | $ 1,937 | $ 7,033 |
2022 | 5,684 | 3,941 |
2023 | 2,740 | 1,033 |
2024 | 938 | 153 |
2025 | 537 | 153 |
Thereafter | 702 | 196 |
Total | $ 12,538 | $ 12,509 |
Property and Equipment, Net - C
Property and Equipment, Net - Components of Property and Equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | $ 17,208 | $ 16,880 | $ 12,467 |
Less: Accumulated depreciation | (8,091) | (6,596) | (3,727) |
Total property and equipment, net | 9,117 | 10,284 | 8,740 |
Leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 8,541 | 9,143 | 6,945 |
Computer and other equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | 6,566 | 5,630 | 4,111 |
Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Total property and equipment | $ 2,101 | $ 2,107 | $ 1,411 |
Property and Equipment, Net - N
Property and Equipment, Net - Narrative (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation expense | $ 3 | $ 2.6 | $ 3.6 | $ 2.1 |
United States | Geographic Concentration Risk | Property, Plant and Equipment | ||||
Property, Plant and Equipment [Line Items] | ||||
Concentration risk, percentage | 92.60% | 92.70% | 97.20% | |
Various International Jurisdictions | Geographic Concentration Risk | Property, Plant and Equipment | ||||
Property, Plant and Equipment [Line Items] | ||||
Concentration risk, percentage | 7.40% | 7.30% | 2.80% |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill - Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets, Net [Abstract] | |||
Accumulated Amortization | $ (2,814) | $ (2,061) | $ (1,788) |
Net Carrying Amount | 6,276 | 1,687 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||
Gross Carrying Amount | 10,982 | 5,046 | 4,281 |
Accumulated Amortization | (2,814) | (2,061) | (1,788) |
Net Carrying Amount | 8,168 | 2,985 | 2,493 |
Trade name and other indefinite-lived intangibles | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Indefinite-lived Intangible Assets | 716 | 425 | 455 |
In-process patents and trademarks | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Indefinite-lived Intangible Assets | $ 1,176 | $ 873 | $ 1,001 |
Acquired content and customer relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Amortization Period (in years) | 4 years 8 months 12 days | 3 years 8 months 12 days | 4 years 9 months 18 days |
Finite-Lived Intangible Assets, Net [Abstract] | |||
Gross Carrying Amount | $ 7,145 | $ 2,268 | $ 2,284 |
Accumulated Amortization | (2,512) | (1,859) | (1,673) |
Net Carrying Amount | 4,633 | 409 | 611 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||
Accumulated Amortization | $ (2,512) | $ (1,859) | $ (1,673) |
Domain names | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Amortization Period (in years) | 2 years 1 month 6 days | 1 year 3 months 18 days | 1 year 8 months 12 days |
Finite-Lived Intangible Assets, Net [Abstract] | |||
Gross Carrying Amount | $ 258 | $ 245 | $ 204 |
Accumulated Amortization | (204) | (156) | (97) |
Net Carrying Amount | 54 | 89 | 107 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||
Accumulated Amortization | $ (204) | $ (156) | $ (97) |
Patents | |||
Finite-Lived Intangible Assets [Line Items] | |||
Weighted Average Amortization Period (in years) | 18 years 8 months 12 days | 19 years 1 month 6 days | 18 years 10 months 24 days |
Finite-Lived Intangible Assets, Net [Abstract] | |||
Gross Carrying Amount | $ 1,687 | $ 1,235 | $ 337 |
Accumulated Amortization | (98) | (46) | (18) |
Net Carrying Amount | 1,589 | 1,189 | 319 |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |||
Accumulated Amortization | $ (98) | $ (46) | $ (18) |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill - Narrative (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Intangible asset amortization expense | $ 0.8 | $ 0.2 | $ 0.3 | $ 0.2 |
Intangible Assets and Goodwil_4
Intangible Assets and Goodwill - Future Amortization Expense (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2021 | $ 296 | $ 262 |
2022 | 1,160 | 186 |
2023 | 1,104 | 129 |
2024 | 1,071 | 97 |
2025 | 735 | 97 |
Thereafter | 1,910 | 916 |
Net Carrying Amount | $ 6,276 | $ 1,687 |
Intangible Assets and Goodwil_5
Intangible Assets and Goodwill - Goodwill (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill [Roll Forward] | |||
Beginning balance | $ 8,605 | $ 8,873 | $ 3,817 |
Acquisitions | 34,243 | 4,852 | |
Other adjustments | (241) | (268) | 204 |
Ending balance | $ 42,607 | $ 8,605 | $ 8,873 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Payables and Accruals [Abstract] | |||
Accrued commissions | $ 8,058 | $ 6,662 | $ 6,298 |
Accrued payroll | 16,507 | 4,839 | 5,847 |
Accounts payable | 3,023 | 2,530 | 3,071 |
Other accrued expenses | 8,452 | 5,234 | 2,877 |
Total accounts payable and accrued expenses | $ 36,040 | $ 19,265 | $ 18,093 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Leases [Abstract] | ||
Lessee, operating lease, renewal term (in years) | 5 years | |
Finance lease, liability, payment, due | $ 0.2 |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||||
Operating lease cost | $ 2,712 | $ 1,310 | $ 2,932 | $ 2,133 |
Short-term lease cost | 402 | 328 | 656 | 562 |
Variable lease cost | 586 | 240 | 501 | 484 |
Total lease cost | $ 3,700 | $ 1,878 | $ 4,089 | $ 3,179 |
Leases - Other Operating Lease
Leases - Other Operating Lease Information (Details) | Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 |
Leases [Abstract] | ||||
Weighted-average remaining lease term (in years) | 4 years 6 months | 5 years 2 months 12 days | 4 years 9 months 18 days | 3 years 6 months |
Weighted-average discount rate | 3.80% | 5.60% | 6.60% | 7.80% |
Leases - Future Lease Payments
Leases - Future Lease Payments Under Non-Cancellable Leases (Details) $ in Thousands | Sep. 30, 2021USD ($) |
Leases [Abstract] | |
2021 | $ 834 |
2022 | 3,732 |
2023 | 3,208 |
2024 | 2,576 |
2025 | 2,003 |
Thereafter | 1,703 |
Total lease payments | 14,056 |
Less: imputed interest | (1,046) |
Total future lease payments under non-cancellable leases | $ 13,010 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||||
Operating cash outflows from operating leases | $ 2,636 | $ 2,079 | $ 2,920 | $ 2,152 |
ROU assets obtained in exchange for lease obligations: | ||||
Operating leases | $ 3,142 | $ 3,224 | $ 3,503 | $ 2,287 |
Revolving Credit Facility (Deta
Revolving Credit Facility (Details) - Credit Agreement - Line of Credit - USD ($) | Mar. 12, 2021 | Sep. 30, 2021 |
Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Current borrowing capacity | $ 100,000,000 | |
Increase limit on borrowings | $ 50,000,000 | |
Borrowings outstanding | $ 0 | |
Revolving Credit Facility | Federal Funds Rate | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 0.50% | |
Revolving Credit Facility | Eurodollar Rate | Maximum | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 1.00% | |
Revolving Credit Facility | Eurodollar Rate | Minimum | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 0.50% | |
Letter of Credit | ||
Debt Instrument [Line Items] | ||
Borrowing capacity | $ 10,000,000 | |
Borrowings outstanding | $ 0 | |
Bridge Loan | ||
Debt Instrument [Line Items] | ||
Borrowing capacity | $ 10,000,000 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) $ / shares in Units, $ in Millions | Apr. 26, 2021USD ($)vote$ / sharesshares | Sep. 30, 2021USD ($)$ / sharesshares | Dec. 31, 2020$ / sharesshares | Dec. 31, 2019$ / sharesshares | Apr. 25, 2021$ / sharesshares | Mar. 31, 2021$ / sharesshares |
Subsidiary, Sale of Stock [Line Items] | ||||||
Offering costs reclassified into stockholders' equity (deficit) | $ | $ 2.2 | |||||
Common stock, shares authorized (in shares) | shares | 0 | 176,000,000 | 176,000,000 | |||
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 | |||
Preferred stock, shares authorized (in shares) | shares | 0 | 114,164,600 | 114,164,600 | 100,000,000 | 114,164,600 | |
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 | $ 0.00001 | $ 0.00001 | |
Preferred stock, dividends per share, declared (in dollars per share) | $ 0 | $ 0 | $ 0.07 | |||
IPO | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Sale of stock, number of shares issued and sold (in shares) | shares | 10,425,000 | |||||
Sale of stock, price per share (in dollars per share) | $ 16 | |||||
Sale of stock, net proceeds | $ | $ 156 | |||||
Over-Allotment Option | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Sale of stock, number of shares issued and sold (in shares) | shares | 1,425,000 | |||||
Common Stock, Class A | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Common stock, shares authorized (in shares) | shares | 1,000,000,000 | 0 | 0 | 1,000,000,000 | ||
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 | $ 0.00001 | ||
Common Stock, Class B | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Common stock, shares authorized (in shares) | shares | 500,000,000 | 0 | 0 | 500,000,000 | ||
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 | $ 0.00001 | $ 0.00001 | ||
Common stock, number of votes | vote | 10 | |||||
Common stock, conversion ratio | 1 | 1 | ||||
Series, A, A-1, and B Preferred Stock | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Preferred stock, convertible, conversion price (in dollars per share) | $ 4.85 | |||||
Convertible, maximum conversion proceeds | $ | $ 100 | |||||
Preferred shares, Series C-1 | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Preferred stock, shares authorized (in shares) | shares | 52,407,360 | 52,407,360 | ||||
Preferred stock, convertible, threshold triggering even share price value (in dollars per share) | $ 8.86 | |||||
Preferred stock, convertible, conversion price subject to certain approvals and requirements (in dollars per share) | $ 6.48 |
Stockholders' Equity - Preferre
Stockholders' Equity - Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | Sep. 30, 2021 | Apr. 25, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Class of Stock [Line Items] | |||||
Preferred stock, shares authorized (in shares) | 0 | 100,000,000 | 114,164,600 | 114,164,600 | 114,164,600 |
Preferred stock, shares issued (in shares) | 0 | 114,164,600 | 114,164,600 | ||
Preferred stock, shares outstanding (in shares) | 0 | 114,164,600 | 114,164,600 | ||
Net Carrying Value | $ 383,933 | $ 383,933 | |||
Liquidation Preference | $ 384,502 | $ 384,502 | |||
Preferred shares, Series A | |||||
Class of Stock [Line Items] | |||||
Issue price per share (in dollars per share) | $ 0.26 | $ 0.26 | |||
Preferred stock, shares authorized (in shares) | 30,525,040 | 30,525,040 | |||
Preferred stock, shares issued (in shares) | 30,525,040 | 30,525,040 | |||
Preferred stock, shares outstanding (in shares) | 30,525,040 | 30,525,040 | |||
Net Carrying Value | $ 8,000 | $ 8,000 | |||
Liquidation Preference | $ 8,000 | $ 8,000 | |||
Preferred shares, Series A-1 | |||||
Class of Stock [Line Items] | |||||
Issue price per share (in dollars per share) | $ 0.82 | $ 0.82 | |||
Preferred stock, shares authorized (in shares) | 6,764,960 | 6,764,960 | |||
Preferred stock, shares issued (in shares) | 6,764,960 | 6,764,960 | |||
Preferred stock, shares outstanding (in shares) | 6,764,960 | 6,764,960 | |||
Net Carrying Value | $ 5,541 | $ 5,541 | |||
Liquidation Preference | $ 5,541 | $ 5,541 | |||
Preferred shares, Series B | |||||
Class of Stock [Line Items] | |||||
Issue price per share (in dollars per share) | $ 1.67 | $ 1.67 | |||
Preferred stock, shares authorized (in shares) | 17,955,840 | 17,955,840 | |||
Preferred stock, shares issued (in shares) | 17,955,840 | 17,955,840 | |||
Preferred stock, shares outstanding (in shares) | 17,955,840 | 17,955,840 | |||
Net Carrying Value | $ 30,000 | $ 30,000 | |||
Liquidation Preference | $ 30,000 | $ 30,000 | |||
Preferred shares, Series C | |||||
Class of Stock [Line Items] | |||||
Issue price per share (in dollars per share) | $ 4.85 | $ 4.85 | |||
Preferred stock, shares authorized (in shares) | 6,511,400 | 6,511,400 | |||
Preferred stock, shares issued (in shares) | 6,511,400 | 6,511,400 | |||
Preferred stock, shares outstanding (in shares) | 6,511,400 | 6,511,400 | |||
Net Carrying Value | $ 31,377 | $ 31,377 | |||
Liquidation Preference | $ 31,561 | $ 31,561 | |||
Preferred shares, Series C-1 | |||||
Class of Stock [Line Items] | |||||
Issue price per share (in dollars per share) | $ 5.90 | $ 5.90 | |||
Preferred stock, shares authorized (in shares) | 52,407,360 | 52,407,360 | |||
Preferred stock, shares issued (in shares) | 52,407,360 | 52,407,360 | |||
Preferred stock, shares outstanding (in shares) | 52,407,360 | 52,407,360 | |||
Net Carrying Value | $ 309,015 | $ 309,015 | |||
Liquidation Preference | $ 309,400 | $ 309,400 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |||||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Apr. 20, 2021 | Jul. 02, 2019 | Jan. 19, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Payments for repurchase of Common Stock and options | $ 1,171 | $ 497 | $ 4,857 | $ 339,880 | |||
Compensation expense | 23,272 | 3,253 | 5,234 | 118,105 | |||
Additional compensation expense | $ 900 | 1,900 | 800 | ||||
Stock repurchase liability | $ 1,000 | 200 | |||||
Unrecognized stock compensation | $ 18,900 | ||||||
Series C and Series C-1 Preferred Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Payments for repurchase of Common Stock and options | 339,300 | ||||||
Compensation expense | $ 115,700 | ||||||
2016 Equity Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Reserved for issuance (in shares) | 10,583,077 | ||||||
2021 Equity Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Authorized issuance or sale of shares (in shares) | 18,400,000 | ||||||
Reserved for issuance (in shares) | 16,618,508 | ||||||
Stock options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Unrecognized stock compensation, weighted-average period (in years) | 2 years 6 months | ||||||
Stock options | 2016 Equity Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Authorized issuance or sale of shares (in shares) | 37,728,000 | 32,746,480 | |||||
Vesting period (in years) | 4 years | ||||||
Share grant expiration period (in years) | 10 years | ||||||
Stock options | Tranche One | 2016 Equity Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting percentage | 25.00% | ||||||
Employee Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Authorized issuance or sale of shares (in shares) | 3,350,000 |
Stock-Based Compensation - Fair
Stock-Based Compensation - Fair Value Assumptions for Stock Options (Details) - Stock options - $ / shares | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 6 years 3 months 18 days | 5 years 7 months 6 days | 6 years 3 months 18 days | |
Expected stock price volatility | 45.00% | 48.00% | ||
Risk-free interest rate | 0.80% | 0.80% | ||
Dividend yield | 0.00% | 0.00% | 0.00% | 0.00% |
Fair value of common stock (in dollars per share) | $ 19.82 | |||
Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 4 years | |||
Expected stock price volatility | 45.00% | 40.00% | ||
Risk-free interest rate | 0.20% | 1.40% | ||
Fair value of common stock (in dollars per share) | $ 4.14 | $ 4.14 | $ 1.07 | |
Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (years) | 6 years 3 months 18 days | |||
Expected stock price volatility | 50.00% | 45.00% | ||
Risk-free interest rate | 1.70% | 2.50% | ||
Fair value of common stock (in dollars per share) | $ 5.71 | $ 5.84 | $ 4.07 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Number of Shares | ||||
Outstanding, beginning balance (in shares) | 14,219,800 | 10,364,520 | 17,101,000 | |
Granted (in shares) | 40,000 | 5,060,720 | 3,114,240 | |
Exercised (in shares) | (3,173,728) | (328,600) | (1,947,760) | |
Repurchased (in shares) | (7,136,480) | |||
Forfeited or expired (in shares) | (502,995) | (876,840) | (766,480) | |
Outstanding, ending balance (in shares) | 10,583,077 | 14,219,800 | 10,364,520 | 17,101,000 |
Vested and exercisable at end of period (in shares) | 7,002,237 | |||
Weighted-Average Exercise Price | ||||
Outstanding, beginning balance (in dollars per share) | $ 2.97 | $ 2.73 | $ 1.47 | $ 0.52 |
Granted (in dollars per share) | 12.01 | 4.93 | 2.90 | |
Exercised (in dollars per share) | 1.84 | 0.68 | 0.19 | |
Repurchased (in dollars per share) | 0.24 | |||
Forfeited and expired (in dollars per share) | 4.07 | 1.92 | 0.98 | |
Outstanding, ending balance (in dollars per share) | 2.73 | 1.47 | 0.52 | |
Vested and exercisable at end of period (in dollars per share) | 2.24 | |||
Weighted-Average Grant Date Fair Value | ||||
Outstanding, beginning balance (in dollars per share) | 1.25 | 0.71 | 0.20 | |
Granted (in dollars per share) | 11.52 | 2.22 | 1.60 | |
Exercised (in dollars per share) | 0.71 | |||
Forfeited or expire (in dollars per share) | 1.70 | |||
Outstanding, ending balance (in dollars per share) | 1.43 | $ 1.25 | $ 0.71 | $ 0.20 |
Vested and exercisable at end of period (in dollars per share) | $ 1.08 | |||
Weighted-Average Remaining Contractual Term (years) | ||||
Outstanding | 7 years 3 months 18 days | 7 years 10 months 24 days | 8 years 1 month 6 days | 7 years 6 months |
Vested and exercisable | 6 years 9 months 18 days | |||
Aggregate Intrinsic Value (in thousands) | ||||
Outstanding, beginning balance | $ 131,893 | $ 18,952 | $ 10,328 | |
Granted | 312 | |||
Exercised | 58,274 | 3,724 | 6,046 | |
Canceled, forfeited or expired | 8,216 | |||
Outstanding, ending balance | 200,938 | $ 131,893 | $ 18,952 | $ 10,328 |
Vested and exercisable | $ 138,061 |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Unit Activity (Details) - RSUs | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Shares | |
Outstanding, beginning balance (in shares) | shares | 0 |
Granted (in shares) | shares | 1,775,992 |
Vested (in shares) | shares | (954,297) |
Forfeited or expired (in shares) | shares | (5,500) |
Outstanding, ending balance (in shares) | shares | 816,195 |
Weighted-Average Grant-Date Fair Value per share | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 0 |
Granted (in dollars per share) | $ / shares | 16.42 |
Vested (in dollars per share) | $ / shares | 16.23 |
Forfeited or expired (in dollars per share) | $ / shares | 28.94 |
Outstanding, ending balance (in dollars per share) | $ / shares | $ 16.56 |
Stock-Based Compensation - Fa_2
Stock-Based Compensation - Fair Value Assumptions for Employee Stock Purchase Plan (Details) - Employee Stock | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected term (years) | 6 months |
Expected stock price volatility | 60.90% |
Risk-free interest rate | 0.40% |
Dividend yield | 0.00% |
Stock-Based Compensation - St_2
Stock-Based Compensation - Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 23,272 | $ 3,253 | $ 5,234 | $ 118,105 |
Cost of revenues | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 253 | 122 | 188 | 83 |
Sales and marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 7,277 | 825 | 1,579 | 5,750 |
Technology and development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 530 | 323 | 896 | 162 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 15,212 | $ 1,983 | $ 2,571 | $ 112,110 |
Net Loss per Share - Computatio
Net Loss per Share - Computation of Net Loss per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Numerator: | |||||
Net loss | $ (16,243) | $ (2,634) | $ (2,430) | $ (124,323) | |
Less: dividend distribution allocated to preferred stockholders | 0 | (3,749) | |||
Net loss attributable to common stockholders | $ (2,430) | $ (128,072) | |||
Allocation of undistributed losses for basic calculation | (2,634) | ||||
Reallocation of undistributed losses for diluted calculation | 0 | ||||
Allocation of undistributed losses for diluted calculation | $ (2,634) | ||||
Denominator: | |||||
Number of shares used in basic per share computation (in shares) | 98,076,290 | 42,116,480 | 42,049,840 | 66,958,400 | |
Number of shares used in diluted per share computation (in shares) | 98,076,290 | 42,116,480 | 42,049,840 | 66,958,400 | |
Net loss per share, basic (in dollars per share) | [1] | $ (0.17) | $ (0.06) | $ (0.06) | $ (1.91) |
Net loss per share, diluted (in dollars per share) | [1] | $ (0.17) | $ (0.06) | $ (0.06) | $ (1.91) |
Common Stock, Class A | |||||
Numerator: | |||||
Allocation of undistributed losses for basic calculation | $ (1,685) | ||||
Reallocation of undistributed losses for diluted calculation | 0 | ||||
Allocation of undistributed losses for diluted calculation | $ (1,685) | ||||
Denominator: | |||||
Number of shares used in basic per share computation (in shares) | 10,176,702 | ||||
Net loss per share, basic (in dollars per share) | $ (0.17) | ||||
Net loss per share, diluted (in dollars per share) | $ (0.17) | ||||
Common Stock, Class B | |||||
Numerator: | |||||
Allocation of undistributed losses for basic calculation | $ (14,558) | ||||
Reallocation of undistributed losses for diluted calculation | 0 | ||||
Allocation of undistributed losses for diluted calculation | $ (14,558) | ||||
Denominator: | |||||
Number of shares used in basic per share computation (in shares) | 87,899,588 | ||||
Net loss per share, basic (in dollars per share) | $ (0.17) | ||||
Net loss per share, diluted (in dollars per share) | $ (0.17) | ||||
[1] | At September 30, 2021, basic and diluted loss per share for Class A and Class B common stock are the same. |
Net Loss per Share - Schedule o
Net Loss per Share - Schedule of Excluded Antidilutive Securities (Details) - shares | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 12,339,017 | 7,510,040 | 12,974,400 | 12,173,640 |
Restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 229,418 | 0 | 0 | 0 |
Preferred shares, Series A | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 0 | 30,525,040 | 30,525,040 | 30,525,040 |
Preferred shares, Series A-1 | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 0 | 6,764,960 | 6,764,960 | 6,764,960 |
Preferred shares, Series B | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 0 | 17,955,840 | 17,955,840 | 17,955,840 |
Preferred shares, Series C | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 0 | 6,511,400 | 6,511,400 | 5,102,080 |
Preferred shares, Series C-1 | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share, amount (in shares) | 0 | 52,407,360 | 52,407,360 | 26,131,880 |
Income Taxes - Schedule of Dome
Income Taxes - Schedule of Domestic and Foreign Components of Income Before Provision for (Benefit from) Income Taxes (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Domestic | $ (5,274) | $ (125,014) | ||
International | 4,676 | 324 | ||
Loss before income tax benefit (expense) | $ (14,443) | $ (2,318) | $ (598) | $ (124,690) |
Income Taxes - Schedule of Prov
Income Taxes - Schedule of Provision for (Benefit from) Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Current: | ||
Federal and Foreign | $ 1,113 | $ 270 |
State | 90 | 34 |
Total current tax expense | 1,203 | 304 |
Deferred: | ||
Federal and Foreign | 628 | (691) |
State | 1 | 2 |
Total deferred tax expense | 629 | (689) |
(Benefit from) provision for income taxes | $ 1,832 | $ (385) |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of the Statutory Federal Income Tax Rate to Effective Tax Rate (Details) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Tax at federal statutory rate | 21.00% | 21.00% |
Foreign and state income taxes | 110.30% | 1.90% |
Permanent differences | (186.30%) | (11.50%) |
Change in valuation allowance | (447.80%) | (9.30%) |
Research and development tax credit | 192.70% | 0.00% |
Return to provision adjustments | (18.50%) | (0.10%) |
Other, net | 22.60% | (1.80%) |
Effective tax rate | (306.20%) | 0.30% |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Net operating loss carryforward | $ 12,156 | $ 16,234 |
Deferred revenue | 16,007 | 9,639 |
Stock-based compensation | 2,838 | 2,843 |
Operating lease liabilities | 2,521 | 1,729 |
Research and development tax credit | 1,151 | 0 |
Other | 429 | 514 |
Gross deferred tax assets | 35,102 | 30,959 |
Less: Valuation allowances | (21,862) | (19,169) |
Total deferred tax assets | 13,240 | 11,790 |
Deferred tax liabilities: | ||
Deferred commissions | (7,398) | (5,642) |
Property, equipment and intangible assets | (2,918) | (3,598) |
Operating lease right of use assets, net | (2,440) | (1,853) |
Other | (361) | (61) |
Total deferred tax liabilities | (13,117) | (11,154) |
Net deferred tax assets | $ 123 | $ 636 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Valuation allowance, increase | $ 2,700,000 | $ 11,900,000 | ||
Federal net operating loss carryforwards | 41,300,000 | 64,900,000 | ||
Net operating loss carryforwards for state income tax purposes | 33,800,000 | 50,300,000 | ||
Research and development tax credit carryforward | 1,151,000 | 0 | ||
Income tax expense (benefit) | $ 1,800,000 | $ 316,000 | 1,832,000 | (367,000) |
Unrecognized tax benefits | $ 0 | $ 0 |
Subsequent Events (Details)
Subsequent Events (Details) - SecurityAdvisor Technologies, Inc. - Subsequent Event $ in Millions | Nov. 01, 2021USD ($) |
Subsequent Event [Line Items] | |
Total purchase price | $ 80 |
Payments To Acquire Businesses, Gross And Business Combination, Consideration Transferred, Equity Interests Issued And Issuable | 50 |
Contingent consideration | 30 |
Payments to Acquire Businesses, Gross | 22.5 |
Earn-Out Provisions | |
Subsequent Event [Line Items] | |
Business acquisition contingent liabilities | 15 |
Equity Award Consideration | RSUs | |
Subsequent Event [Line Items] | |
Business acquisition contingent liabilities | 15 |
Common Stock, Class A | |
Subsequent Event [Line Items] | |
Equity consideration | $ 27.5 |