Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 08, 2021 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2021 | |
Entity File Number | 001-39412 | |
Entity Registrant Name | FATHOM HOLDINGS INC. | |
Entity Incorporation, State or Country Code | NC | |
Entity Tax Identification Number | 82-1518164 | |
Entity Address, Address Line One | 2000 Regency Parkway Drive | |
Entity Address, Address Line Two | Suite 300 | |
Entity Address, City or Town | Cary | |
Entity Address State Or Province | NC | |
Entity Address, Postal Zip Code | 27518 | |
City Area Code | 888 | |
Local Phone Number | 455-6040 | |
Title of 12(b) Security | Common Stock, No Par Value | |
Trading Symbol | FTHM | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 14,796,207 | |
Entity Central Index Key | 0001753162 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 8,753 | $ 28,577 |
Restricted cash | 3,570 | 984 |
Accounts receivable | 3,635 | 1,595 |
Derivative assets | 48 | |
Mortgage loans held for sale, at fair value | 10,674 | |
Prepaid and other current assets | 2,146 | 1,700 |
Total current assets | 28,826 | 32,856 |
Property and equipment, net | 1,007 | 155 |
Lease right of use assets | 4,504 | 437 |
Intangible assets, net | 23,958 | 922 |
Goodwill | 20,342 | 799 |
Other assets | 95 | 56 |
Total assets | 78,732 | 35,225 |
Current liabilities: | ||
Accounts payable | 4,016 | 2,596 |
Accrued liabilities | 4,985 | 1,065 |
Escrow liabilities | 3,509 | 933 |
Derivative liabilities | 17 | |
Warehouse lines of credit | 10,305 | |
Long-term debt - current portion | 1,211 | 256 |
Lease liability - current portion | 1,732 | 140 |
Deferred tax liabilities | 365 | |
Total current liabilities | 25,775 | 4,990 |
Long-term debt, net of current portion | 146 | 283 |
Lease liability, net of current portion | 2,852 | 301 |
Total liabilities | 29,138 | 5,574 |
Commitments and contingencies (Note 18) | ||
Stockholders' equity: | ||
Common stock, no par value, 100,000,000 authorized and 14,796,207 and 13,830,351 issued and outstanding as of September 30, 2021 and December 31, 2020, respectively | ||
Treasury Stock, at cost, 5,683 shares as of September 30, 2021 and December 31, 2020 | (30) | (30) |
Additional paid-in capital | 65,977 | 37,169 |
Accumulated deficit | (16,353) | (7,488) |
Total stockholders' equity | 49,594 | 29,651 |
Total liabilities and stockholders' equity | $ 78,732 | $ 35,225 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2021 | Dec. 31, 2020 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value | $ 0 | $ 0 |
Common stock, authorized shares | 100,000,000 | 100,000,000 |
Common stock, issued shares | 14,796,207 | 13,830,351 |
Common stock, outstanding shares | 14,744,539 | 13,830,351 |
Treasury stock, shares | 5,683 | 5,683 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Revenue | $ 100,940,000 | $ 55,848,000 | $ 234,769,000 | $ 123,375,000 |
Operating Expenses [Abstract] | ||||
Commission and other agent-related costs | 91,263,000 | 52,871,000 | 214,392,000 | 115,915,000 |
Operations and support | 2,029,000 | 3,781,000 | ||
General and administrative | 9,811,000 | 2,851,000 | 25,322,000 | 6,726,000 |
Marketing | 591,000 | 218,000 | 1,371,000 | 587,000 |
Depreciation and amortization | 931,000 | 44,000 | 1,778,000 | 108,000 |
Total operating expenses | 104,625,000 | 55,984,000 | 246,644,000 | 123,336,000 |
(Loss) income from operations | (3,685,000) | (136,000) | (11,875,000) | 39,000 |
Other (income) expense, net | ||||
Gain on the extinguishment of debt | (76,000) | (127,000) | ||
Interest expense, net | 2,000 | 16,000 | 3,000 | 81,000 |
Other income, net | (28,000) | (66,000) | (10,000) | |
Other (income) expense, net | (102,000) | 16,000 | (190,000) | 71,000 |
Loss before income taxes | (3,583,000) | (152,000) | (11,685,000) | (32,000) |
Income tax benefit (expense) | 210,000 | (32,000) | 2,820,000 | (33,500) |
Net loss | $ (3,373,000) | $ (184,000) | $ (8,865,000) | $ (66,000) |
Net loss per share | ||||
Basic | $ (0.24) | $ (0.02) | $ (0.64) | $ (0.01) |
Diluted | $ (0.24) | $ (0.02) | $ (0.64) | $ (0.01) |
Weighted average common shares outstanding | ||||
Basic | 14,312,675 | 12,156,111 | 13,948,862 | 10,721,917 |
Diluted | 14,312,675 | 12,156,111 | 13,948,862 | 10,721,917 |
Gross commission income | ||||
Revenue | $ 95,300,000 | $ 55,848,000 | $ 224,703,000 | $ 123,375,000 |
Other service revenue | ||||
Revenue | $ 5,640,000 | $ 10,066,000 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands | Common StockIPO | Common Stock | Treasury Stock | Additional Paid in CapitalIPO | Additional Paid in Capital | Accumulated deficit | IPO | Total |
Beginning balance at Dec. 31, 2019 | $ 4,988 | $ (6,148) | $ (1,159) | |||||
Beginning balance (in shares) at Dec. 31, 2019 | 10,211,658 | |||||||
Changes in Stockholders' deficit | ||||||||
Issuance of common stock | $ 34,300 | 83 | $ 34,300 | 83 | ||||
Issuance of common stock (in shares) | 3,430,000 | 15,726 | ||||||
Offering costs in connection with public offering | (3,183) | (3,183) | ||||||
Purchase of treasury stock | $ (30) | (30) | ||||||
Purchase of treasury stock (in shares) | (5,683) | 5,683 | ||||||
Share-based compensation, net of forfeitures | 322 | 322 | ||||||
Share-based compensation, net of forfeitures (in shares) | (13,652) | |||||||
Net loss | (66) | (66) | ||||||
Ending balance at Sep. 30, 2020 | $ (30) | 36,511 | (6,214) | 30,267 | ||||
Ending balance (in shares) at Sep. 30, 2020 | 13,638,049 | 5,683 | ||||||
Beginning balance at Jun. 30, 2020 | $ (30) | 5,297 | (6,030) | (763) | ||||
Beginning balance (in shares) at Jun. 30, 2020 | 10,210,571 | 5,683 | ||||||
Changes in Stockholders' deficit | ||||||||
Issuance of common stock | $ 34,300 | $ 34,300 | ||||||
Issuance of common stock (in shares) | 3,430,000 | |||||||
Offering costs in connection with public offering | (3,183) | (3,183) | ||||||
Share-based compensation, net of forfeitures | 97 | 97 | ||||||
Share-based compensation, net of forfeitures (in shares) | (2,522) | |||||||
Net loss | (184) | (184) | ||||||
Ending balance at Sep. 30, 2020 | $ (30) | 36,511 | (6,214) | 30,267 | ||||
Ending balance (in shares) at Sep. 30, 2020 | 13,638,049 | 5,683 | ||||||
Beginning balance at Dec. 31, 2020 | $ (30) | 37,169 | (7,488) | 29,651 | ||||
Beginning balance (in shares) at Dec. 31, 2020 | 13,830,351 | 5,683 | ||||||
Changes in Stockholders' deficit | ||||||||
Issuance of common stock for purchase of business | 25,312 | 25,312 | ||||||
Issuance of common stock for purchase of business (in shares) | 777,380 | |||||||
Issuance of common stock pursuant to exercise of stock options | 80 | $ 80 | ||||||
Issuance of common stock pursuant to exercise of stock options (in shares) | 16,972 | 16,974 | ||||||
Share-based compensation, net of forfeitures | 3,416 | $ 3,416 | ||||||
Share-based compensation, net of forfeitures (in shares) | 171,504 | |||||||
Net loss | (8,865) | (8,865) | ||||||
Ending balance at Sep. 30, 2021 | $ (30) | 65,977 | (16,353) | 49,594 | ||||
Ending balance (in shares) at Sep. 30, 2021 | 14,796,207 | 5,683 | ||||||
Beginning balance at Jun. 30, 2021 | $ (30) | 64,624 | (12,980) | 51,614 | ||||
Beginning balance (in shares) at Jun. 30, 2021 | 14,741,814 | 5,683 | ||||||
Changes in Stockholders' deficit | ||||||||
Share-based compensation, net of forfeitures | 1,353 | 1,353 | ||||||
Share-based compensation, net of forfeitures (in shares) | 54,393 | |||||||
Net loss | (3,373) | (3,373) | ||||||
Ending balance at Sep. 30, 2021 | $ (30) | $ 65,977 | $ (16,353) | $ 49,594 | ||||
Ending balance (in shares) at Sep. 30, 2021 | 14,796,207 | 5,683 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (8,865) | $ (66) |
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 1,778 | 108 |
Gain on the extinguishment of debt | (127) | |
Gain on sale of mortgages | (3,264) | |
Share-based compensation | 2,833 | 322 |
Deferred income tax | (2,865) | |
Bad debt expense | 248 | 106 |
Other non-cash | 44 | |
Change in operating assets and liabilities: | ||
Accounts receivable | (908) | (1,093) |
Agent annual fees receivable | 36 | (495) |
Other operating assets | 9 | 3 |
Prepaid and other assets | (797) | (621) |
Accounts payable | 387 | 1,148 |
Accrued liabilities | 1,806 | 280 |
Escrow liabilities | 2,418 | |
Operating lease right of use assets | 496 | 16 |
Other operating liabilities | (103) | (24) |
Operating lease liabilities | (433) | (14) |
Mortgage loans held for sale | (108,562) | |
Proceeds from sale and principal payments on mortgage loans held for sale | 109,299 | |
Net cash used in operating activities | (6,570) | (330) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of property and equipment | (576) | (26) |
Amounts paid for business and asset acquisitions; net of cash acquired | (10,969) | |
Purchase of intangible assets | (2,017) | (341) |
Net cash used in investing activities | (13,562) | (367) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Principal payments on long-term debt | (399) | (13) |
Proceeds from the issuance of common stock | 80 | 83 |
Proceeds from note payable | 865 | 454 |
Net borrowings on warehouse lines of credit | 2,347 | |
Proceeds from the issuance of common stock in connection with public offering | 34,300 | |
Payment of offering cost in connection with issuance of common stock in connection with public offering | (3,183) | |
Purchase of treasury stock | (30) | |
Extinguishment of note payable | (500) | |
Net cash provided by financing activities | 2,893 | 31,111 |
Net (decrease) increase in cash, cash equivalents, and restricted cash | (17,239) | 30,414 |
Cash, cash equivalents, and restricted cash at beginning of period | 29,562 | 579 |
Cash, cash equivalents, and restricted cash at end of period | 12,323 | 30,993 |
Supplemental disclosure of cash and non-cash transactions: | ||
Cash paid for interest | 82 | |
Income taxes paid | 5 | |
Amounts due to sellers | 1,477 | |
Capitalized share-based compensation | 583 | |
Right of use assets obtained in exchange for lease liabilities | 1,839 | |
Issuance of common stock for the purchase of business | 25,312 | |
Issuance of common stock warrants as offering costs in connection with public offering of common stock | 678 | |
Extinguishment of Paycheck Protection Program Loan | 127 | |
Loan receivable forgiven and used as purchase consideration | 165 | |
Reconciliation of cash and restricted cash | ||
Cash and cash equivalents | 8,753 | 30,993 |
Restricted cash | 3,570 | |
Total cash, cash equivalents, and restricted cash shown in statement of cash flows | $ 12,323 | $ 30,993 |
Description of Business and Nat
Description of Business and Nature of Operations | 9 Months Ended |
Sep. 30, 2021 | |
Description of Business and Nature of Operations | |
Description of Business and Nature of Operations | Note 1. Description of Business and Nature of Operations Fathom Holdings Inc. (“Fathom”, “Fathom Holdings,” and collectively with its consolidated subsidiaries and affiliates, the “Company”) is a national, technology-driven, real estate services platform integrating residential brokerage, mortgage, title, insurance and software as a service (“SaaS”) offerings to brokerages and agents leveraging our proprietary cloud-based software called intelliAgent. During the nine months ended September 30, 2021, Fathom significantly grew its agent network, expanded its technology offerings, and entered into the residential mortgage lending and home and other insurance businesses by completing four business combinations and an asset acquisition. On March 1, 2021, the Company acquired the real estate brokerage business of Red Barn Real Estate, LLC (“Red Barn”), a growing Atlanta metro area brokerage with approximately 230 agents. On June 30, 2021, the Company acquired the real estate brokerage business of Epic Realty, LLC (“Epic”), a growing regional brokerage based in greater Boise, Idaho, with approximately 350 agents. Also on March 1, 2021 the Company acquired the technology platform of Naberly Inc. (“Naberly”) to reduce the Company’s reliance on third-party technology providers and offer more robust technology to agents to help them grow their businesses. On April 20, 2021, the Company acquired LiveBy, Inc. (“LiveBy”), a SaaS business with a technology platform that offers competitive, hyper-local tools for real estate professionals. On April 16, 2021, the Company acquired E4:9 Holdings, Inc. (“E4:9”), a holding company with three operating subsidiaries, Encompass Lending Group (“Encompass”) (mortgage), Dagley Insurance Agency (home and other insurance) and Real Results (lead generation). These companies are expected to provide agents and associates with new opportunities to grow their businesses, while giving consumers a one-stop-shop for all of their housing needs. The Company’s brands include Fathom Realty, Dagley Insurance, Encompass Lending, intelliAgent, LiveBy, Real Results, and Verus Title. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2021 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | Note 2. Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The unaudited interim consolidated financial statements include the accounts of Fathom Holdings’ wholly owned subsidiaries. All transactions and accounts between and among its subsidiaries have been eliminated. All adjustments and disclosures necessary for a fair presentation of these unaudited interim consolidated financial statements have been included. Certain Significant Risks and Business Uncertainties Liquidity $0.1 COVID-19 Risks, Impacts and Uncertainties The Company is subject to the risks arising from COVID-19 including its social and economic impacts on the residential real estate industry in the United States. Our management believes that these social and economic impacts, which to date have included but not been limited to the following, could have a significant impact on the Company’s future financial condition, liquidity, and results of operations: (i) restrictions on in-person activities associated with residential real estate transactions arising from shelter-in-place, or similar isolation orders; (ii) decline in consumer demand for in-person interactions and physical home tours; and (iii) deteriorating economic conditions, such as increased unemployment rates, recessionary conditions, lower yields on individual investment portfolios, and more stringent mortgage financing conditions. Given the daily evolution of COVID-19 and the global responses to curb its spread, the Company is not able to estimate the effects of COVID-19, including specifically the Delta variant and/or other variants, on its results of operations, financial condition, or liquidity for the year ending December 31, 2021 or beyond. If COVID-19 continues, it may have a material adverse effect on the Company’s financial condition, liquidity, and future results of operations. Use of Estimates Business Combinations — The estimated fair value of net assets acquired, including the allocation of the fair value to identifiable assets and liabilities, is determined using established valuation techniques. A fair value measurement is determined as the price received to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. In the context of acquisition accounting, the determination of fair value often involves significant judgments and estimates by management, including the selection of valuation methodologies, estimates of future revenues, costs and cash flows, discount rates, and selection of comparable companies. The estimated fair values reflected in the acquisition accounting rely on management’s judgment and the expertise of a third-party valuation firm engaged to assist in concluding on the fair value measurements. For the business combinations completed during the nine-month period ended September 30, 2021, the estimated fair value of identifiable intangible assets, primarily consisting of agent relationships, tradenames, customer relationships, know-how and technology, was determined using the relief-from royalty and multi-period excess earnings methods. The most significant assumptions include the estimated remaining useful life, expected future revenue, annual agent revenue attrition, costs to develop new agents, charges for contributory assets, tax rate, discount rate and tax amortization benefit. The most significant variables in these valuations are discount rates and the number of years on which to base the cash flow projections, as well as other assumptions and estimates used to determine the cash inflows and outflows. Management determines discount rates based on the risk inherent in the acquired assets, specific risks, industry beta and capital structure of guideline companies. Management has developed these assumptions on the basis of historical knowledge of the business and projected financial information of the Company. These assumptions may vary based on future events, perceptions of different market participants and other factors outside the control of Management, and such variations may be significant to estimated values. The Company includes the results of operations from the acquisition date in the financial statements for all businesses acquired. Asset Acquisitions — If the acquisition is deemed to be a business, the acquisition method of accounting is applied. Identifiable assets acquired and liabilities assumed at the acquisition date are recorded at fair value. If the transaction is deemed to be an asset acquisition, the cost accumulation and allocation model is used whereby the assets and liabilities are recorded based on the purchase price and allocated to the individual assets and liabilities based on relative fair values. Mortgage Loans Held for Sale Intangible Assets, Net — Definite-lived intangibles: Capitalized internal use software: . Capitalized software costs are amortized over the expected useful lives of the applicable software. Currently, capitalized software for internal use has a useful life estimated between five Estimated useful lives of website and software development activities are reviewed annually or whenever events or changes in circumstances indicate that intangible assets may be impaired and adjusted as appropriate to reflect upcoming development activities that may include significant upgrades or enhancements to the existing functionality. Goodwill Revenue Recognition Revenue from Contracts with Customers The Company has utilized the practical expedient in ASC 606 and elected not to capitalize contract costs for contracts with customers with durations less than one year. The Company does not have significant remaining unfulfilled performance obligations or contract balances. The Company generates revenue from real estate brokerage services which consists of commissions generated from real estate transactions, which the Company classifies as gross commission income.The Company also generates revenues through mortgage lending, SaaS solutions, as well as title and insurance services, which the Company classifies as other service revenue. Revenues from real estate brokerage services The Company’s real estate brokerage services revenue substantially consists of commissions generated from real estate brokerage services. The Company is contractually obligated to provide for the fulfillment of transfers of real estate between buyers and sellers. The Company provides these services itself and controls the services of its agents necessary to legally transfer the real estate. Correspondingly, the Company is defined as the principal. The Company, as principal, satisfies its obligation upon the closing of a real estate transaction. The Company has concluded that agents are not employees of the Company, rather deemed to be independent contractors. Upon satisfaction of its obligation, the Company recognizes revenue in the gross amount of consideration it is entitled to receive. The transaction price is calculated by applying the Company’s portion of the agreed-upon commission rate to the property’s selling price. The Company may provide services to the buyer, seller, or both parties to a transaction. When the Company provides services to the seller in a transaction, it recognizes revenue for its portion of the commission, which is calculated as the sales price multiplied by the commission rate less the commission separately distributed to the buyer’s agent, or the “sell” side portion of the commission. When the Company provides services to the buyer in a transaction, the Company recognizes revenue in an amount equal to the sales price for the property multiplied by the commission rate for the “buy” side of the transaction. In instances in which the Company represents both the buyer and the seller in a transaction, it recognizes the full commission on the transaction. Commissions revenue contains a single performance obligation that is satisfied upon the closing of a real estate transaction, at which point the entire transaction price is earned. The Company’s customers remit payment for the Company’s services to the title company or attorney closing the sale of property at the time of closing. The Company receives payment upon close of property or within days of the closing of a transaction. The Company is not entitled to any commission until the performance obligation is satisfied and is not owed any commission for unsuccessful transactions, even if services have been provided. Revenues from mortgage services The revenue streams for the Company’s mortgage lending services business are primarily comprised of gains and losses from loans sold, and origination and other fees. The majority of these revenue streams are exempted from ASC 606. Origination and other fees are not specifically separable from actual mortgage loans. The gain on sale of mortgage loans represents the difference between the net sales proceeds and the carrying value of the mortgage loans sold, including the servicing rights release premiums and is recorded in the statement of operations in other service revenue. Transfers of financial assets are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before maturity. Servicing rights release premiums represent revenues earned when the risk and rewards of ownership of servicing rights are transferred to third parties. Retail origination fees are principally revenues earned from loan originations. Direct loan origination costs and expenses associated with the loans are charged to expenses when the loans are sold. Interest income is interest earned on originated loans prior to the sale of the asset. Revenues from technology The Company generates revenue from subscription and services related to the use of the LiveBy platform. The SaaS contracts are generally annual contracts paid monthly in advance of service and cancellable upon 30 days’ notice after the first year. The Company’s subscription arrangements do not provide customers with the right to take possession of the software supporting the platform. Subscription revenue, which includes support, is recognized on a straight-line basis over the non-cancellable contractual term of the arrangement, generally beginning on the date that the Company’s service is made available to the customer, and recorded as other service revenue in the statement of operations. Revenues from title services The Company’s title services revenue includes fees charged for title search and examination, property settlement and title insurance services provided in association with property acquisitions and refinance transactions. The Company provides the title search and property settlement services itself and controls the services before they are transferred to our customers since the Company is primarily responsible for fulfilling the promise and also has full discretion in establishing the price for the settlement services (except in states where fees are set statutorily). As such, the Company is defined as the principal. As principal, the Company satisfies our obligation upon the closing of a real estate transaction. Upon satisfaction of our obligation, the Company recognizes revenue in the gross amount of consideration the Company is entitled to receive. The transaction price for title and property settlement services is determined by the fixed fees the Company charges for our services. The Company provides services to the buyers and sellers involved in the purchase transaction, as well as to the borrower in a refinance transaction. Title and property settlement revenue contains a single performance obligation that is satisfied upon the closing of a real estate transaction, at which point the entire transaction price is earned. The Company is not entitled to any title and property settlement revenue until the performance obligation is satisfied and is not owed any consideration for unsuccessful transactions, even if services have been provided. For title insurance services, the Company works in conjunction with insurance underwriters to perform these services, obtains the insurance policy premiums associated with title insurance on behalf of customers and remits the policy premium to the insurance underwriters. Since the insurance underwriter is ultimately providing the insurance policy to the borrower, the Company is not responsible for fulfilling the promise to provide the insurance. Additionally, the Company does not have discretion in dictating the price for the insurance policy, which is set by each jurisdiction and is either filed by insurance underwriters or set by the state insurance commissioners. Therefore, the Company does not control the specified service provided by the insurance underwriter. As such, in these circumstances, the Company acts as an agent. As the agent, the Company satisfies our obligation upon the closing of a real estate transaction. Upon satisfaction of our obligation, the Company recognizes revenue in the net amount of consideration the Company is entitled to receive, which is our fee for brokering the insurance policy less any consideration paid to the insurance underwriters. The transaction price for title insurance services is fixed, based on statutory rates depending on the jurisdiction. The Company negotiates with insurance underwriters the percentage they receive, and the rest is recognized as revenue. Title insurance revenue contains a single performance obligation that is satisfied upon the closing of a real estate transaction, at which point the entire transaction price is earned. The Company is not entitled to any title insurance revenue until the performance obligation is satisfied and is not owed any consideration for unsuccessful transactions, even if services have been provided. Revenues from insurance agency services The revenue streams for the Company’s insurance agency services business are primarily comprised of new and renewal commissions paid by insurance carriers. The transaction price is set as the estimated commissions to be received over the term of the policy based upon an estimate of premiums placed, policy changes and cancellations, net of restraint. The commissions are earned at the effective date of the associated policies when control of the policy transfers to the client. The Company is also eligible for certain contingent commissions from insurers based on the attainment of specific metrics (i.e., volume growth, loss ratios) related to underlying polices placed. Revenue for contingent commissions is estimated based on historical and current evidence of achievement towards each insurer’s annual respective metrics and is recorded as the underlying policies that contribute to the achievement are placed. Due to the uncertainty of the amount of contingent consideration that will be received, the estimated revenue is constrained to an amount that is probable to not have a significant negative adjustment. Contingent consideration is generally received in the first quarter of the subsequent year. Derivative financial instruments The Company manages the interest rate risk associated with its outstanding interest rate lock commitments and loans held for sale by entering into derivative loan instruments such as forward loan commitments, mandatory delivery commitments, options and future contracts, whereby the Company maintains the right to deliver residential loans to purchasers in the future at a specified yield. Fair value is based upon estimated amounts that the Company would receive or pay to terminate the commitment at the reporting date. The Company takes into account various factors and strategies in determining the portion of the mortgage pipeline it wants to economically hedge. Management expects the derivatives used to manage interest rate risk will experience changes in fair value opposite to changes in the fair value of the derivative loan commitments and loans held for sale, thereby reducing earnings volatility. Reclassifications ● Gross commission income is comprised of revenues from the Real Estate Brokerage segment which were previously recorded in revenue ● Other service revenue is comprised of revenues not included in the Real Estate Brokerage segment which were previously recorded in revenue ● Commission and other agent-related costs is comprised of the direct costs to fulfill the services from the Real Estate Brokerage segment which were previously recorded in cost of revenue ● Operations and support are comprised of the direct costs to fulfill the services not included in the Real Estate Brokerage segment which were previously recorded in cost of revenue ● Depreciation and amortization represent the depreciation charged on the Company’s fixed assets and intangible assets which were previously recorded in general and administrative expenses. Recently Implemented Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12, “Simplifying the Accounting for Income Taxes”. The provisions of ASU 2019-12 include eliminating certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The guidance is effective for the reporting period beginning after December 15, 2020, and the interim periods therein. The Company adopted this standard effective January 1, 2021 and the application of ASU 2019-12 did not have a material impact on the Company's condensed consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2021 | |
Acquisitions | |
Acquisitions | Note 3. Acquisitions Acquisition of Red Barn On March 1, 2021, the Company completed the acquisition of Red Barn, in a transaction deemed immaterial to the Company. The Red Barn acquisition was accounted for as a business combination using the acquisition method of accounting. Due to the timing of the acquisition, the valuation of net assets acquired has not been finalized and is expected to be completed no later than one year from the acquisition date in accordance with GAAP. Acquisition of Naberly On March 1, 2021 the Company acquired substantially all of the assets of Naberly for cash consideration of approximately $2.7 million. Based on the Company’s preliminary estimation of the fair value of the assets acquired, the Naberly acquisition was accounted for as an asset acquisition. The total acquisition cost, including transaction costs of approximately $0.1 million, was approximately $2.8 million and was recorded as software intangible assets. During the year ended December 31, 2020, in connection with, and in advance of the closing under the asset purchase agreement to acquire the assets of Naberly, the Company issued to Naberly, an unsecured loan (the “Loan”) in the principal amount of up to approximately $0.2 million with an interest rate of two percent (2%) per annum, compounded annually, and a maturity date of February 28, 2021. The outstanding principal balance of the Loan was forgiven in connection with the closing of the acquisition and was accounted for as part of the purchase consideration transferred to Naberly. Acquisition of E4:9 On April 16, 2021 the Company purchased 100% of outstanding capital stock of E4:9. The Company accounted for the E4:9 acquisition as a business combination. The purchase price consisted of approximately $9.8 million cash consideration and approximately $16.6 million common stock consideration for a total purchase price of approximately $26.5 million. The aggregate purchase price exceeded the fair value of the net tangible and intangible assets acquired, and accordingly the Company recorded goodwill of approximately $14.4 million. The total purchase consideration and the fair values of the assets and liabilities at the acquisition date were as follows (amount in thousands): Recognized amounts of identifiable assets acquired and liabilities assumed Cash $ 2,843 Accounts receivable 958 Mortgage loans held for sale 8,147 Derivative assets 90 Prepaid and other current assets 122 Property & equipment 356 Intangible assets 11,780 Lease right of use assets 1,498 Other long-term assets 7 Total identifiable assets acquired 25,801 Accounts payable and accrued liabilities 938 Escrow liabilities 75 Derivative liabilities 120 Warehouse lines of credit 7,958 Notes payable 486 Lease liability, current portion 337 Lease liability, net of current portion 1,161 Deferred tax liabilities 2,686 Total liabilities assumed 13,761 Total identifiable net assets 12,040 Goodwill 14,418 Net assets acquired $ 26,458 The Company recognized approximately $0.3 million of acquisition related costs that were expensed in the nine months ended September 30, 2021 and are included in general and administrative expenses. Goodwill of approximately $7.4 million and $7.0 million was assigned to the Company’s Mortgage and Other services reporting units, respectively, and is attributable primarily to our assembled workforce and the anticipated future economic benefits of the vertical integration of E4:9’s mortgage lending and insurance product offerings available to our real estate agents. None of the goodwill is expected to be deductible for income tax purposes. The fair value associated with identifiable intangible assets was approximately $11.8 million, comprised of customer relationships of approximately $6.2 million, tradenames of approximately $5.2 million and know-how of approximately $0.4 million. Customer relationships is being amortized on an accelerated basis over a useful life of 8 years. Tradenames and know-how are amortized on a straight-line basis over 10 years and 5 years, respectively. Due to the timing of the acquisition, the valuation of net assets acquired has not been finalized and is expected to be completed no later than one year from the acquisition date in accordance with GAAP. The Company’s condensed consolidated financial statements include the results of operations of E4:9 since the closing on April 16, 2021 during which period E4:9 contributed approximately $4.0 million and $1.0 million of revenues and net loss, respectively, for the three months ended September 30, 2021 and approximately $6.9 million and $2.6 million of revenues and net loss, respectively, for the nine months ended September 30, 2021, respectively. Acquisition of LiveBy On April 20, 2021 the Company purchased 100% of outstanding capital stock of LiveBy. The Company accounted for the LiveBy acquisition as a business combination. The purchase price consisted of approximately $3.4 million cash consideration and approximately $5.6 million common stock consideration for a total purchase price of approximately $9.0 million. The aggregate purchase price exceeded the fair value of the net tangible and intangible assets acquired, and accordingly the Company recorded goodwill of approximately $4.1 million. The total purchase consideration and the fair values of the assets and liabilities at the acquisition date were as follows (amount in thousands): Recognized amounts of identifiable assets acquired and liabilities assumed Cash $ 516 Accounts receivable 138 Intangible assets 4,920 Prepaid and other current assets 2 Total identifiable assets acquired 5,576 Deferred tax liabilities 543 Accounts payable and accrued liabilities 167 Total liabilities assumed 710 Total identifiable net assets 4,866 Goodwill 4,115 Net assets acquired $ 8,981 The Company recognized approximately $0.2 million of acquisition related costs that were expensed in the nine months ended September 30, 2021 and are included in general and administrative expenses. Goodwill was assigned to the technology reporting unit and is attributable primarily to our assembled workforce and the anticipated future economic benefits to the Company’s agents through technology product offerings. None of the goodwill is expected to be deductible for income tax purposes. Due to the timing of the acquisition, the valuation of net assets acquired has not been finalized and is expected to be completed no later than one year from the acquisition date in accordance with GAAP. The Company’s consolidated financial statements include the results of operations of LiveBy since the closing on April 20, 2021 during which period LiveBy contributed approximately $0.6 million and $0.1 million of revenues and net income, respectively, for the three months ended September 30, 2021 and approximately $1.0 million and less than $0.1 million of revenues and net loss, respectively, for the nine months ended September 30, 2021. Acquisition of Epic Realty On June 30, 2021, the Company completed the acquisition of Epic Realty (“Epic”) in a transaction deemed immaterial to the Company. The Epic acquisition was accounted for as a business combination using the acquisition method of accounting. Due to the timing of the acquisition, the valuation of net assets acquired has not been finalized and is expected to be completed by no later than one year from the acquisition date in accordance with GAAP. Supplemental Pro Forma Financial Information On an unaudited pro forma basis, the revenues and net loss of the Company assuming the acquisitions of E4:9 and LiveBy occurred on January 1, 2020, are shown below. The unaudited pro forma information does not purport to present what the Company’s actual results would have been had the acquisition happened on January 1, 2020, nor is the financial information indicative of the results of future operations. The pro forma financial information includes the estimated amortization expense based on the fair value and estimated useful lives of intangible assets as part of the acquisitions of E4:9 and LiveBy (amount in thousands, except per share): Nine months ended September 30, 2021 2020 Revenue $ 240,282 $ 136,667 Net loss $ (15,709) $ (697) Net loss per share (basic) $ (1.07) $ (0.07) |
Property and Equipment, Net
Property and Equipment, Net | 9 Months Ended |
Sep. 30, 2021 | |
Property and Equipment, Net | |
Property and Equipment, Net | Note 4. Property and Equipment, Net Property and equipment, net consisted of the following at the dates indicated (amount in thousands): September 30, 2021 December 31, 2020 Vehicles $ — $ 119 Computers and equipment 453 139 Furniture and fixtures 610 44 Leasehold improvements 132 4 Total property and equipment 1,195 306 Accumulated depreciation (188) (151) Total property and equipment, net $ 1,007 $ 155 Depreciation expense for property and equipment was approximately $0.1 million and $0.1 million for the three and nine months ended September 30, 2021, respectively, and de minimis amounts for the three and nine months ended September 30, 2020. |
Intangible Assets, Net
Intangible Assets, Net | 9 Months Ended |
Sep. 30, 2021 | |
Intangible Assets, Net | |
Intangible Assets, Net | Note 5. Intangible Assets, Net Intangible assets, net consisted of the following at the dates indicated (amount in thousands): September 30, 2021 Gross Carrying Accumulated Net Carrying Amount Amortization Value Trade names $ 6,326 $ (562) $ 5,764 Software development 8,182 (852) 7,330 Customer relationships 8,180 (314) 7,866 Agent relationships 2,670 (84) 2,586 Know-how 430 (18) 412 $ 25,788 $ (1,830) $ 23,958 December 31, 2020 Gross Carrying Accumulated Net Carrying Amount Amortization Value Trade names $ 166 $ (1) $ 165 Software development 921 (164) 758 $ 1,087 $ (165) $ 922 As of September 30, 2021, the estimated future amortization expense for definite-lived intangible assets was (amount in thousands): Years Ended December 31, 2021 (remaining) $ 924 2022 3,802 2023 3,701 2024 3,588 2025 3,353 Thereafter 8,590 Total $ 23,958 Amortization expense was approximately $0.9 million and $1.7 million for the three and nine months ended September 30, 2021, respectively and de minimis amounts for the three and nine months ended September 30, 2020. |
Goodwill
Goodwill | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill. | |
Goodwill | Note 6. Goodwill The Company recorded goodwill in connection with the acquisition of Verus which closed in November 2020 and in connection with the acquisitions of Red Barn, E4:9, LiveBy and Epic which closed in 2021. These acquisitions have been accounted for using the acquisition method of accounting. Under the acquisition method of accounting, the Company allocated the total purchase price to the tangible and identifiable intangible assets acquired, and assumed liabilities based on their estimated fair values as of the acquisition date, as determined by management. The excess of the purchase price over the aggregate fair values of the identifiable assets was recorded as goodwill. The changes in the carrying value of goodwill by segment as of September 30, 2021 are as noted in the table below (amount in thousands): Real Estate Brokerage Mortgage Technology Other (a) Total Balance at December 31, 2020 $ — $ — $ — $ 799 $ 799 Goodwill acquired during the period 1,009 7,400 4,115 7,019 19,543 Balance at September 30, 2021 $ 1,009 $ 7,400 $ 4,115 $ 7,818 $ 20,342 (a) There are no accumulated impairment charges as of September 30, 2021 and December 31, 2020. |
Accrued Liabilities
Accrued Liabilities | 9 Months Ended |
Sep. 30, 2021 | |
Accrued Liabilities | |
Accrued Liabilities | Note 7. Accrued Liabilities Accrued liabilities consisted of the following at the dates indicated (amount in thousands): September 30, 2021 December 31, 2020 Deferred annual fee $ 659 $ 293 Due to sellers 1,477 — Accrued compensation 1,094 202 Other accrued liabilities 1,755 570 Total accrued liabilities $ 4,985 $ 1,065 |
Warehouse Lines of Credit
Warehouse Lines of Credit | 9 Months Ended |
Sep. 30, 2021 | |
Warehouse Lines of Credit | |
Warehouse Lines of Credit | Note 8. Warehouse Lines of Credit As a means of financing mortgage loans held for sale, the Company utilizes line of credit agreements for the purpose of temporarily warehousing mortgage loans pending the sale of the loans. The warehouse lines of credit are classified as current on the condensed consolidated balance sheet and secured by mortgage loans held for sale with fair values that approximate the obligations to the lender. The Company maintained a warehousing credit and security agreement with a bank whereby the Company borrowed funds to finance the origination of eligible mortgage loans. The Company paid interest equal to the greater of Prime Rate less 0.75% or 3.85% per annum. The Prime Rate as of September 30, 2021 was 3.25%. The maximum funding limit of these loans was $15.0 million at September 30, 2021. At September 30, 2021, there was no outstanding balance on this warehouse line. The agreement expired in October 2021. The Company maintains a master loan warehouse agreement with a bank whereby the Company borrows funds to finance the origination or purchase of eligible loans. The Company pays interest equal to the greater of the mortgage interest rate of the underlying loan or 3.625%. The maximum funding of these loans was $15.0 million at September 30, 2021. At September 30, 2021, the outstanding balance on this warehouse line was approximately $4.1 million. The credit agreement requires the Company to maintain at least $1.0 million in liquid assets. The agreement expires in July 2022. The Company maintains a mortgage participation purchase agreement with a bank whereby the Company borrows funds to finance the origination or purchase of eligible loans. The Company pays interest equal to the greater of the mortgage interest rate of the underlying loan or 3.5%. The maximum funding of these loans was $25.0 million at September 30, 2021. At September 30, 2021, the outstanding balance on this warehouse line was approximately $6.2 million. The credit agreement requires the Company to maintain at least $1.0 million in liquid assets and have net income for the preceding 12 month period. The agreement expires in April 2023. During the three months ended September 30, 2021, the Company was not in compliance with the income debt covenants and obtained a waiver from the bank through December 31, 2021. The Company maintains a warehousing credit and security agreement with a bank whereby the Company borrows funds to finance the origination of eligible mortgage loans. The Company pays interest equal to the Daily Adjusting LIBOR rate plus 2.00% or 3.5% per annum. The Daily Adjusting LIBOR rate plus 2.00% as of September 30, 2021 was 2.09%. The maximum funding limit of these loans was $15.0 million at September 30, 2021. The credit agreement requires the Company to maintain at least $1.0 million in liquid assets, a tangible net worth of $2.3 million, debt-to-tangible net worth ratio of 15 to 1 and have net income for the preceding 12 month period. The income debt covenant becomes effective in July 2022. The agreement expires in April 2023. At September 30, 2021, there was no outstanding balance on this warehouse line. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2021 | |
Debt | |
Debt | Note 9. Debt Long-term debt consisted of the following at the dates indicated (amount in thousands): September 30, 2021 December 31, 2020 Paycheck Protection Program Loan $ 303 $ 354 Small Business Administration Loan 171 150 Note Payable 883 — Loan Payable - Automobile Loan — 35 Total debt 1,357 539 Less current portion of the Paycheck Protection Program Loan (303) (237) Less current portion of the Small Business Administration Loan (25) (2) Less current portion of Note Payable (883) — Less current portion of the Loan Payable — (17) Long-term debt, net of current portion $ 146 $ 283 Note Payable – Paycheck Protection Program Loan In May 2020, the Company applied for and received approximately $0.3 million in unsecured loan funding (the “PPP Loan”) from the Paycheck Protection Program (the “PPP”), established pursuant to the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) and administered by the U.S. Small Business Administration (“SBA”). Under the terms of the promissory note (the “PPP Note”) and the PPP Loan, interest accrued on the outstanding principal at the rate of 1% per annum. The Company believes it has used the entire PPP Note amount for qualifying expenses and applied for forgiveness in March 2021, however, until forgiveness is approved by the SBA there is no assurance that the Company will obtain forgiveness of the PPP Loan in whole or in part. Additionally, in connection with the acquisition of Verus, the Company assumed approximately $0.1 million in additional loan funding from the PPP. The Company received full forgiveness of all outstanding principal, accrued, and unpaid interest on this loan as of January 6, 2021. The forgiveness of this loan qualified for debt extinguishment in accordance with ASC 470-50, Debt Modifications and Extinguishments Additionally, in connection with the acquisition of E4:9, the Company assumed approximately $0.1 million in loan funding from the PPP (“E4:9 PPP Loan”). Under the terms of the promissory note (the “E4:9 PPP Note”) and the E4:9 PPP Loan, interest accrued on the outstanding principal at the rate of 1% per annum. The Company received full forgiveness of all outstanding principal, accrued, and unpaid interest on this loan as of August 2021. The forgiveness of this loan qualified for debt extinguishment in accordance with ASC 470-50, Debt Modifications and Extinguishments Note Payable Additionally, in connection with the acquisition of E4:9, the Company assumed a non-interest-bearing approximately $0.4 million promissory note to be paid in full at maturity date of July 1, 2022. During the three months ended September 30, 2021, the Company paid approximately $0.2 million on the promissory note. In July 2021, the Company entered into a promissory note for approximately $0.9 million in conjunction with a renewal of its director and officer insurance policy. The interest rate was 2.5% per annum. The note matures on July 31, 2022. Note Payable – Small Business Administration Loan On June 5, 2020, the Company received $0.2 million in loan funding from the SBA (the “SBA Note”) under the Economic Injury Disaster Loan program. The Company will use all the proceeds of this secured SBA Note solely as working capital to alleviate economic injury caused by COVID-19. The SBA Note is evidenced by a promissory note of the Company dated June 5, 2020 in the principal amount of approximately $0.2 million, to the SBA, the lender. Under the terms of the SBA Note, interest accrues on the outstanding principal at a rate of 3.75% per annum, and installment payments began in June 2021. All remaining principal and accrued interest is due and payable in May 2050. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Measurements | |
Fair Value Measurements | Note 10. Fair Value Measurements FASB ASC 820, Fair Value Measurement ● Level 1 inputs are quoted market prices in active markets for identical assets or liabilities (these are observable market inputs). ● Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability (includes quoted market prices for similar assets or identical or similar assets in markets in which there are few transactions, prices that are not current or prices that vary substantially). ● Level 3 inputs are unobservable inputs that reflect the entity’s own assumptions in pricing the asset or liability (used when little or no market data is available). A description of the valuation methodologies used for assets and liabilities measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. In general, fair value is based upon quoted market prices, where evaluated. If such quoted market prices are not available, fair value is based upon internally developed models that primarily use, as inputs, observable market-based parameters. Valuation adjustments may be made to ensure the financial instruments are recorded at fair value. While management believes the Company’s valuation methodologies are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. Mortgage loans held for sale – The fair value of mortgage loans held for sale is determined, when possible, using quoted secondary-market prices or purchaser commitments. If no such quoted price exists, the fair value of a loan is determined using quoted prices for a similar asset or assets, adjusted for the specific attributes of that loan, which would be used by other market participants. The loans are considered Level 2 on the fair value hierarchy. Derivative financial instruments – Derivative financial instruments are reported at fair value. Fair value is determined using a pricing model with inputs that are unobservable in the market or cannot be derived principally from or corroborated by observable market data. These instruments are Level 3 on the fair value hierarchy. The fair value determination of each derivative financial instrument categorized as Level 3 required one or more of the following unobservable inputs: ● Agreed prices from Interest Rate Lock Commitments (“IRLC”) ● Trading prices for derivative hedges ● Closing prices at September 30, 2021 for derivative hedges The following are the major categories of assets and liabilities measured at fair value on a recurring basis as of September 30, 2021 (amount in thousands): Level 1 Level 2 Level 3 Total Mortgage loans held for sale $ — $ 10,674 $ — $ 10,674 Derivative assets — — 48 48 Derivative liabilities — — (17) (17) $ — $ 10,674 $ 31 $ 10,705 The Company enters into IRLCs to originate residential mortgage loans held for sale, at specified interest rates and within a specific period of time (generally between 30 and 90 days), with customers who have applied for a loan and meet certain credit and underwriting criteria. These IRLCs meet the definition of a derivative and are reflected on the consolidated balance sheets at fair value with changes in fair value recognized in other service revenue on the consolidated statements of operations. Unrealized gains and losses on the IRLCs, reflected as derivative assets and derivative liabilities, respectively, are measured based on the fair value of the underlying mortgage loan, quoted agency mortgage-backed security (“MBS”) prices, estimates of the fair value of the mortgage servicing rights and the probability that the mortgage loan will fund within the terms of the IRLC, net of commission expense and broker fees. The fair value of the forward loan sales commitment and mandatory delivery commitments being used to hedge the IRLCs and mortgage loans held for sale not committed to purchasers are based on quoted agency MBS prices. The Company did not have any mortgage loans held for sale or derivative financial instruments at December 31, 2020. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2021 | |
Leases | |
Leases | Note 11. Leases Operating Leases The Company has operating leases primarily consisting of office space with remaining lease terms of 1 Leases with an initial term of twelve months or less are not recorded on the balance sheet, and the Company does not separate lease and non-lease components of contracts. There are no material residual guarantees associated with any of the Company’s leases, and there are no significant restrictions or covenants included in the Company’s lease agreements. Certain leases include variable payments related to common area maintenance and property taxes, which are billed by the landlord, as is customary with these types of charges for office space. Our lease agreements generally do not provide an implicit borrowing rate. Therefore, the Company used a benchmark approach to derive an appropriate imputed discount rate. The Company benchmarked itself against other companies of similar credit ratings and comparable quality and derived an imputed rate, which was used in a portfolio approach to discount its real estate lease liabilities. The Company used estimated incremental borrowing rates for all active leases. Lease Costs The table below presents certain information related to the lease costs for the Company’s operating leases for the periods indicated (amount in thousands): Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Components of total lease costs: Operating lease expense $ 296 $ 48 $ 589 $ 118 Short-term lease expense 120 12 244 47 Total lease cost $ 416 $ 60 $ 833 $ 165 Lease Terms and Discount Rate The table below presents certain information related to the weighted average remaining lease term and the weighted average discount rate for the Company’s operating leases as of: September 30, 2021 December 31, 2020 Weighted average remaining lease term (in years) - operating leases 5.17 3.37 Weighted average discount rate - operating leases 5.92 % 7.67 % Future Minimum Lease Payments Future lease payments included in the measurement of lease liabilities on the consolidated balance sheet as of September 30, 2021, for the following five fiscal years and thereafter were as follows (amount in thousands): Operating Years Ended December 31, Leases 2021 (remaining) $ 287 2022 1,119 2023 1,047 2024 968 2025 847 2026 and thereafter 1,103 Total minimum lease payments $ 5,371 Less effects of discounting (787) Present value of future minimum lease payments $ 4,584 |
Share-based Compensation
Share-based Compensation | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Compensation | |
Share-based Compensation | Note 12. Share-based Compensation The Company’s 2017 Stock Plan (the “Plan”) provides for granting stock options and restricted stock awards to employees, directors, contractors and consultants of the Company. A total of 3,182,335 shares of common stock are authorized to be issued pursuant to the Plan. The Company’s 2019 Omnibus Stock Incentive Plan (the “2019 Plan”) provides for granting stock options and restricted stock awards to employees, directors, agents, contractors and consultants of the Company. A total of 1,060,778 shares of common stock are authorized to be issued pursuant to the 2019 Plan. Restricted Stock Awards Weighted Average Grant Shares Date Fair Value Nonvested at December 31, 2020 390,787 $ 13.56 Granted 230,976 37.22 Vested (67,816) (29.87) Forfeited (23,950) (12.90) Nonvested at September 30, 2021 529,997 $ 10.90 In March 2021, pursuant to the 2019 Plan, the Company granted 82,003 restricted stock awards to certain employees and agents, of which 4,564 awards vested immediately and the remaining 77,439 awards will vest three years from the grant date subject to continuous service with the Company. The fair value of these restricted stock awards was $32.87 per share based on the Company’s closing stock price on the grant date. In March 2021, pursuant to the 2019 Plan, in connection with the Company’s acquisitions of Naberly and Red Barn (See Note 3), the Company granted 44,568 restricted stock awards to former founders who are now employees of the Company, of which 10,478 will vest one year from the grant date, and the remaining 34,090 will vest 18 months from the grant date. The fair value of the Company’s restricted stock awards granted in March 2021 was $44.00 per share based on the Company’s closing stock price on the grant date. Stock Option Awards A summary of stock option activity under the Plans are as follows: Weighted Average Weighted Remaining Options Average Contractual Term Aggregate Outstanding Exercise Price in Years intrinsic value (in thousands) Balance at December 31, 2020 47,332 $ 8.03 8.8 $ 1,326 Granted 13,638 44.00 Exercised (16,974) 4.71 Balance at September 30, 2021 43,996 $ 20.46 8.5 $ 510 Options exercisable at September 30, 2021 20,156 $ 4.71 7.5 $ 433 In March 2021, pursuant to the 2019 Plan, the Board granted stock option awards to the independent directors to acquire shares of common stock with an exercise price of $44.00 per share. The stock options will vest on the earlier of (a) one year from the date of grant and (b) the next annual stockholder meeting, subject to the director’s continued service on the Board. Stock based compensation related to the Company’s stock plans are as follows (amount in thousands): Three months ended Nine months ended September 30, September 30, 2021 2020 2021 2020 General and administrative $ 295 $ 97 $ 1,811 $ 322 Commission and other agent-related cost 474 — 1,022 — Total stock-based compensation $ 769 $ 97 $ 2,833 $ 322 The Company capitalized $0.6 million of stock-based compensation expense associated with the cost of developing software for internal use during the three and months ended September 30, 2021. |
Equity-classified Warrants
Equity-classified Warrants | 9 Months Ended |
Sep. 30, 2021 | |
Equity-classified Warrants | |
Equity-classified Warrants | Note 13. Equity-classified Warrants On August 4, 2020, the Company issued a warrant to the underwriter of its initial public offering (“IPO”) (the “Underwriter Warrant”) to purchase 240,100 shares of common stock. The Underwriter Warrant is exercisable at a per share exercise price of $11.00, and is exercisable at any time from and after January 31, 2021 through August 4, 2025. During the nine months ended September 30, 2021, no warrants to purchase common stock were issued, exercised, or expired. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2021 | |
Related Party Transactions | |
Related Party Transactions | Note 14. Related Party Transactions Included in marketing expense for the three months ended September 30, 2021 and 2020 was approximately $0.1 million and less than $0.1 million, respectively, and for the nine months ended September 30, 2021 and 2020 was approximately $0.4 million and $0.1 million, respectively, to related parties in exchange for the Company receiving marketing services. |
Net (Loss) Income per Share Att
Net (Loss) Income per Share Attributable to Common Stock | 9 Months Ended |
Sep. 30, 2021 | |
Net (Loss) Income per Share Attributable to Common Stock | |
Net (Loss) Income per Share Attributable to Common Stock | Note 15. Net (Loss) Income per Share Attributable to Common Stock Basic net (loss) income per share of common stock is computed by dividing net (loss) income attributable to common stockholders by the weighted average number of shares of common stock outstanding for the period. Diluted net (loss) income per share is calculated by adjusting the weighted-average number of shares outstanding for the dilutive effect of common stock equivalents outstanding for the period, determined using the treasury-stock method. Diluted (loss) income per share excludes, when applicable, the potential impact of stock options, unvested shares of restricted stock awards, and common stock warrants because their effect would be anti-dilutive due to our net loss. The calculation of basic and diluted net loss per share attributable to common stock was as follows: Three months ended Nine months ended September 30, September 30, 2021 2020 2021 2020 Net loss $ (3,373) $ (184) $ (8,865) $ (66) Weighted-average basic shares outstanding 14,312,675 12,156,111 13,948,862 10,721,917 Effect of dilutive securities: Unvested restricted stock awards — — — — Stock options — — — — Weighted-average diluted shares outstanding 14,312,675 12,156,111 13,948,862 10,721,917 Net loss per share - basic and diluted $ (0.24) $ (0.02) $ (0.64) $ (0.01) The following outstanding shares of common stock equivalents were excluded from the computation of the diluted net loss per share attributable to common stock for the periods presented because their effect would have been anti-dilutive. Three months ended Nine months ended September 30, September 30, 2021 2020 2021 2020 Stock options 43,996 37,130 43,966 37,130 Unvested restricted stock awards 529,997 214,329 529,997 214,329 Common stock warrants 240,100 240,100 240,100 240,100 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2021 | |
Income Taxes | |
Income Taxes | Note 16. Income Taxes As of December 31, 2020, the Company had federal net operating loss carryforwards of approximately $9.2 million and state net operating loss carryforwards of approximately $4.5 million. Losses will begin to expire, if not utilized, in 2032. Utilization of the net operating loss carryforwards may be subject to an annual limitation according to Section 382 of the Internal Revenue Code of 1986 as amended, and similar provisions. The Company applies the standards on uncertainty in income taxes contained in ASC Topic 740, Accounting for Income Taxes. The adoption of this interpretation did not have any impact on the Company’s consolidated financial statements, as the Company did not have any significant unrecognized tax benefits during the three and nine months ended September 30, 2021 or the year ended December 31, 2020. Currently, the statute of limitations remains open subsequent to and including the year ended December 31, 2016. In determining the quarterly provision for income taxes, the Company used the annual effective tax rate applied to year-to-date income. The Company’s annual estimated effective tax rate differs from the statutory rate primarily as a result of state taxes, permanent differences, and changes in the Company’s valuation allowance. The income tax effects of unusual or infrequent items including a change in the valuation allowance as a result of a change in judgment regarding the realizability of deferred tax assets are excluded from the estimated annual effective tax rate and are required to be discretely recognized in the interim period they occur. The effective tax rate differed significantly in the nine months ended September 30, 2021 from prior periods. The Company has historically maintained a valuation allowance against deferred tax assets and reported only minimal current state tax expense. The Company recorded an income tax benefit of approximately $2.8 million and income tax expense of $33,500 for the nine months ended September 30, 2021 and 2020 respectively. The tax benefit for the nine months ended September 30, 2021 is primarily the result of the release of the valuation allowance against historical deferred tax assets and recognition of benefit from the current year projected loss. Net deferred tax liabilities of approximately $3.2 million recorded in connection with the E4:9 Holdings, Inc. and LiveBy, Inc acquisitions provide a source of taxable income to support the realizability of approximately $1.6 million of pre-existing deferred tax assets, as well as currently generated deferred tax assets from the projected loss for the year. The taxable temporary differences relating to the amortizable intangible assets support the realization of the net operating loss carryforwards. As a result of the transactions, the Company discretely released the historical valuation allowance and recognized a deferred tax benefit on a portion of current year losses. The remainder of the benefit not recorded in the period ended September 30, 2021 is expected to be recognized in the period ending December 31, 2021. The Company expects to maintain a valuation allowance on current year remaining net deferred tax assets by year-end due to historical operating losses. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting | |
Segment Reporting | Note 17. Segment Reporting The Company identifies an operating segment as a component: (i) that engages in business activities from which it may earn revenues and incur expenses; (ii) that has available discrete financial information; and (iii) whose operating results are regularly reviewed by the Chief Operating Decision Maker (“CODM”) to allocate resources and to assess the operating results and financial performance of each operating segment. Historically, management has not made operating decisions nor assessed performance based on geographic locations. Rather, the CODM has made operating decisions and assessed performance based on the services of identified operating segments. Prior to the acquisition of E4:9 during the three months ended June 30, 2021 which included the mortgage lending and insurance agency services, the Company aggregated its real estate brokerage services segment and its affiliated services (e.g., title insurance) segment as the profits and losses and assets of the affiliated services segment were not material. During the three months ended June 30, 2021, the Company identified three reportable segments: Real Estate Brokerage, Mortgage, and Technology. Through its Real Estate Brokerage segment, the Company provides real estate brokerage services. Through its Mortgage segment, the Company provides residential loan origination and underwriting services. Through its Technology segment, the Company provides SaaS solutions and data mining for third party customers to develop its intelliAgent platform for current use by the Company’s real estate agents. As a result, the Company has modified the presentation of its segment financial information with retrospective application to all prior periods presented. Revenue and Adjusted EBITDA are the primary measures used by the CODM to evaluate financial performance of the reportable segments and to allocate resources. Adjusted EBITDA represents the revenues of the operating segment less operating expenses directly attributable to the respective operating segment. Adjusted EBITDA is defined by us as net income (loss) before depreciation and amortization, interest expense, net, income taxes, and other items. In particular, the Company believes the exclusion of non-cash share-based compensation expense related to restricted stock awards and stock options and transaction-related costs provides a useful supplemental measure in evaluating the performance of our operations and provides better transparency into our results of operations. The Company’s presentation of Adjusted EBITDA might not be comparable to similar measures used by other companies. The Company does not allocate assets to its reportable segments as they are not included in the review performed by the CODM for purposes of assessing segment performance and allocating resources. The balance sheet is managed on a consolidated basis and is not used in the context of segment reporting. Key operating data for the reportable segments for the three and nine months ended September 30, 2021 and are set forth in the tables below (amount in thousands). The Company has included the results of the acquisitions from the acquisition date. As such, the key operating data for the three and nine months ended September 30, 2020 include only the result of the Real Estate Brokerage reportable segment. Revenue Three months ended Nine months ended September 30, September 30, 2021 2020 2021 2020 Real Estate Brokerage $ 95,300 $ 55,848 $ 224,702 $ 123,375 Mortgage 2,623 — 4,125 — Technology 679 — 1,278 — Corporate and other services (a) 2,338 — 4,664 — Total Company $ 100,940 $ 55,848 $ 234,769 $ 123,375 Adjusted EBITDA Three months ended Nine months ended September 30, September 30, 2021 2020 2021 2020 Real Estate Brokerage $ 199 $ 6 $ 188 $ 469 Mortgage (101) — (991) — Technology 56 — (566) — Total Segment Adjusted EBITDA 154 6 (1,369) 469 Corporate and other services (a) (1,961) — (4,755) — Total Company Adjusted EBITDA $ (1,807) $ 6 $ (6,124) $ 469 Less: (931) (45) (1,778) (108) Other income (expense), net 102 (16) 190 (71) Income tax benefit (expense) 210 (32) 2,820 (34) Stock based compensation (770) (97) (2,833) (322) Transaction-related costs (177) — (1,140) — Net loss $ (3,373) $ (184) $ (8,865) $ (66) (a) Transactions between segments are eliminated in consolidation. Such amounts are eliminated through the Corporate and Other services line. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies | |
Commitments and Contingencies | Note 18. Commitments and Contingencies From time to time the Company is involved in litigation, claims, and other proceedings arising in the ordinary course of business. Such litigation and other proceedings may include, but are not limited to, actions relating to employment law and misclassification, intellectual property, commercial or contractual claims, brokerage or real estate disputes, or other consumer protection statutes, ordinary-course brokerage disputes like the failure to disclose property defects, commission disputes, and vicarious liability based upon conduct of individuals or entities outside of the Company’s control, including agents and third party contractor agents. Litigation and other disputes are inherently unpredictable and subject to substantial uncertainties and unfavorable resolutions could occur. As of September 30, 2021, there was no material litigation against the Company. Encompass Net Worth Requirements In order to maintain approval from the U.S. Department of Housing and Urban Development to operate as a Title II non-supervised mortgagee, Encompass is required to maintain adjusted net worth of $1,000,000 and must maintain liquid assets (cash, cash equivalents, or readily convertible instruments) of 20% of the required net worth. As of September 30, 2021, Encompass had adjusted net worth of approximately $2.4 million and liquid assets of $2.5 million. Commitments to Extend Credit Encompass enters into IRLCs with borrowers who have applied for residential mortgage loans and have met certain credit and underwriting criteria. These commitments expose the Encompass to market risk if interest rates change and the underlying loan is not economically hedged or committed to a purchaser. Encompass is also exposed to credit loss if the loan is originated and not sold to a purchaser and the mortgagor does not perform. The collateral upon extension of credit typically of a first deed of trust in the mortgagor’s residential property. Commitments to originate loans do not necessarily reflect future cash requirements as commitments are expected to expire without being drawn upon. Regulatory Commitments Encompass is subject to periodic audits and examinations, both formal and informal in nature, from various federal and state agencies, including those made as part of the regulatory oversight of mortgage origination, servicing and financing activities. Such audits and examinations could result in additional actions, penalties or fines by state or federal government bodies, regulators or the courts. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events | |
Subsequent Events | Note 19. Subsequent Events All subsequent events requiring recognition as of September 30, 2021 have been incorporated into these financial statements and there are no subsequent events that require disclosure in accordance with ASC Topic 855 - Subsequent Events. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Summary of Significant Accounting Policies | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The unaudited interim consolidated financial statements include the accounts of Fathom Holdings’ wholly owned subsidiaries. All transactions and accounts between and among its subsidiaries have been eliminated. All adjustments and disclosures necessary for a fair presentation of these unaudited interim consolidated financial statements have been included. |
Certain Significant Risks and Business Uncertainties | Certain Significant Risks and Business Uncertainties |
Liquidity | Liquidity $0.1 |
COVID-19 Risks, Impacts and Uncertainties | COVID-19 Risks, Impacts and Uncertainties The Company is subject to the risks arising from COVID-19 including its social and economic impacts on the residential real estate industry in the United States. Our management believes that these social and economic impacts, which to date have included but not been limited to the following, could have a significant impact on the Company’s future financial condition, liquidity, and results of operations: (i) restrictions on in-person activities associated with residential real estate transactions arising from shelter-in-place, or similar isolation orders; (ii) decline in consumer demand for in-person interactions and physical home tours; and (iii) deteriorating economic conditions, such as increased unemployment rates, recessionary conditions, lower yields on individual investment portfolios, and more stringent mortgage financing conditions. Given the daily evolution of COVID-19 and the global responses to curb its spread, the Company is not able to estimate the effects of COVID-19, including specifically the Delta variant and/or other variants, on its results of operations, financial condition, or liquidity for the year ending December 31, 2021 or beyond. If COVID-19 continues, it may have a material adverse effect on the Company’s financial condition, liquidity, and future results of operations. |
Use of Estimates | Use of Estimates |
Business Combinations | Business Combinations — The estimated fair value of net assets acquired, including the allocation of the fair value to identifiable assets and liabilities, is determined using established valuation techniques. A fair value measurement is determined as the price received to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. In the context of acquisition accounting, the determination of fair value often involves significant judgments and estimates by management, including the selection of valuation methodologies, estimates of future revenues, costs and cash flows, discount rates, and selection of comparable companies. The estimated fair values reflected in the acquisition accounting rely on management’s judgment and the expertise of a third-party valuation firm engaged to assist in concluding on the fair value measurements. For the business combinations completed during the nine-month period ended September 30, 2021, the estimated fair value of identifiable intangible assets, primarily consisting of agent relationships, tradenames, customer relationships, know-how and technology, was determined using the relief-from royalty and multi-period excess earnings methods. The most significant assumptions include the estimated remaining useful life, expected future revenue, annual agent revenue attrition, costs to develop new agents, charges for contributory assets, tax rate, discount rate and tax amortization benefit. The most significant variables in these valuations are discount rates and the number of years on which to base the cash flow projections, as well as other assumptions and estimates used to determine the cash inflows and outflows. Management determines discount rates based on the risk inherent in the acquired assets, specific risks, industry beta and capital structure of guideline companies. Management has developed these assumptions on the basis of historical knowledge of the business and projected financial information of the Company. These assumptions may vary based on future events, perceptions of different market participants and other factors outside the control of Management, and such variations may be significant to estimated values. The Company includes the results of operations from the acquisition date in the financial statements for all businesses acquired. |
Asset Acquisitions | Asset Acquisitions — If the acquisition is deemed to be a business, the acquisition method of accounting is applied. Identifiable assets acquired and liabilities assumed at the acquisition date are recorded at fair value. If the transaction is deemed to be an asset acquisition, the cost accumulation and allocation model is used whereby the assets and liabilities are recorded based on the purchase price and allocated to the individual assets and liabilities based on relative fair values. |
Mortgage Loans Held for Sale | Mortgage Loans Held for Sale |
Intangible Assets, Net | Intangible Assets, Net — Definite-lived intangibles: Capitalized internal use software: . Capitalized software costs are amortized over the expected useful lives of the applicable software. Currently, capitalized software for internal use has a useful life estimated between five Estimated useful lives of website and software development activities are reviewed annually or whenever events or changes in circumstances indicate that intangible assets may be impaired and adjusted as appropriate to reflect upcoming development activities that may include significant upgrades or enhancements to the existing functionality. |
Goodwill | Goodwill |
Revenue Recognition | Revenue Recognition Revenue from Contracts with Customers The Company has utilized the practical expedient in ASC 606 and elected not to capitalize contract costs for contracts with customers with durations less than one year. The Company does not have significant remaining unfulfilled performance obligations or contract balances. The Company generates revenue from real estate brokerage services which consists of commissions generated from real estate transactions, which the Company classifies as gross commission income.The Company also generates revenues through mortgage lending, SaaS solutions, as well as title and insurance services, which the Company classifies as other service revenue. Revenues from real estate brokerage services The Company’s real estate brokerage services revenue substantially consists of commissions generated from real estate brokerage services. The Company is contractually obligated to provide for the fulfillment of transfers of real estate between buyers and sellers. The Company provides these services itself and controls the services of its agents necessary to legally transfer the real estate. Correspondingly, the Company is defined as the principal. The Company, as principal, satisfies its obligation upon the closing of a real estate transaction. The Company has concluded that agents are not employees of the Company, rather deemed to be independent contractors. Upon satisfaction of its obligation, the Company recognizes revenue in the gross amount of consideration it is entitled to receive. The transaction price is calculated by applying the Company’s portion of the agreed-upon commission rate to the property’s selling price. The Company may provide services to the buyer, seller, or both parties to a transaction. When the Company provides services to the seller in a transaction, it recognizes revenue for its portion of the commission, which is calculated as the sales price multiplied by the commission rate less the commission separately distributed to the buyer’s agent, or the “sell” side portion of the commission. When the Company provides services to the buyer in a transaction, the Company recognizes revenue in an amount equal to the sales price for the property multiplied by the commission rate for the “buy” side of the transaction. In instances in which the Company represents both the buyer and the seller in a transaction, it recognizes the full commission on the transaction. Commissions revenue contains a single performance obligation that is satisfied upon the closing of a real estate transaction, at which point the entire transaction price is earned. The Company’s customers remit payment for the Company’s services to the title company or attorney closing the sale of property at the time of closing. The Company receives payment upon close of property or within days of the closing of a transaction. The Company is not entitled to any commission until the performance obligation is satisfied and is not owed any commission for unsuccessful transactions, even if services have been provided. Revenues from mortgage services The revenue streams for the Company’s mortgage lending services business are primarily comprised of gains and losses from loans sold, and origination and other fees. The majority of these revenue streams are exempted from ASC 606. Origination and other fees are not specifically separable from actual mortgage loans. The gain on sale of mortgage loans represents the difference between the net sales proceeds and the carrying value of the mortgage loans sold, including the servicing rights release premiums and is recorded in the statement of operations in other service revenue. Transfers of financial assets are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before maturity. Servicing rights release premiums represent revenues earned when the risk and rewards of ownership of servicing rights are transferred to third parties. Retail origination fees are principally revenues earned from loan originations. Direct loan origination costs and expenses associated with the loans are charged to expenses when the loans are sold. Interest income is interest earned on originated loans prior to the sale of the asset. Revenues from technology The Company generates revenue from subscription and services related to the use of the LiveBy platform. The SaaS contracts are generally annual contracts paid monthly in advance of service and cancellable upon 30 days’ notice after the first year. The Company’s subscription arrangements do not provide customers with the right to take possession of the software supporting the platform. Subscription revenue, which includes support, is recognized on a straight-line basis over the non-cancellable contractual term of the arrangement, generally beginning on the date that the Company’s service is made available to the customer, and recorded as other service revenue in the statement of operations. Revenues from title services The Company’s title services revenue includes fees charged for title search and examination, property settlement and title insurance services provided in association with property acquisitions and refinance transactions. The Company provides the title search and property settlement services itself and controls the services before they are transferred to our customers since the Company is primarily responsible for fulfilling the promise and also has full discretion in establishing the price for the settlement services (except in states where fees are set statutorily). As such, the Company is defined as the principal. As principal, the Company satisfies our obligation upon the closing of a real estate transaction. Upon satisfaction of our obligation, the Company recognizes revenue in the gross amount of consideration the Company is entitled to receive. The transaction price for title and property settlement services is determined by the fixed fees the Company charges for our services. The Company provides services to the buyers and sellers involved in the purchase transaction, as well as to the borrower in a refinance transaction. Title and property settlement revenue contains a single performance obligation that is satisfied upon the closing of a real estate transaction, at which point the entire transaction price is earned. The Company is not entitled to any title and property settlement revenue until the performance obligation is satisfied and is not owed any consideration for unsuccessful transactions, even if services have been provided. For title insurance services, the Company works in conjunction with insurance underwriters to perform these services, obtains the insurance policy premiums associated with title insurance on behalf of customers and remits the policy premium to the insurance underwriters. Since the insurance underwriter is ultimately providing the insurance policy to the borrower, the Company is not responsible for fulfilling the promise to provide the insurance. Additionally, the Company does not have discretion in dictating the price for the insurance policy, which is set by each jurisdiction and is either filed by insurance underwriters or set by the state insurance commissioners. Therefore, the Company does not control the specified service provided by the insurance underwriter. As such, in these circumstances, the Company acts as an agent. As the agent, the Company satisfies our obligation upon the closing of a real estate transaction. Upon satisfaction of our obligation, the Company recognizes revenue in the net amount of consideration the Company is entitled to receive, which is our fee for brokering the insurance policy less any consideration paid to the insurance underwriters. The transaction price for title insurance services is fixed, based on statutory rates depending on the jurisdiction. The Company negotiates with insurance underwriters the percentage they receive, and the rest is recognized as revenue. Title insurance revenue contains a single performance obligation that is satisfied upon the closing of a real estate transaction, at which point the entire transaction price is earned. The Company is not entitled to any title insurance revenue until the performance obligation is satisfied and is not owed any consideration for unsuccessful transactions, even if services have been provided. Revenues from insurance agency services The revenue streams for the Company’s insurance agency services business are primarily comprised of new and renewal commissions paid by insurance carriers. The transaction price is set as the estimated commissions to be received over the term of the policy based upon an estimate of premiums placed, policy changes and cancellations, net of restraint. The commissions are earned at the effective date of the associated policies when control of the policy transfers to the client. The Company is also eligible for certain contingent commissions from insurers based on the attainment of specific metrics (i.e., volume growth, loss ratios) related to underlying polices placed. Revenue for contingent commissions is estimated based on historical and current evidence of achievement towards each insurer’s annual respective metrics and is recorded as the underlying policies that contribute to the achievement are placed. Due to the uncertainty of the amount of contingent consideration that will be received, the estimated revenue is constrained to an amount that is probable to not have a significant negative adjustment. Contingent consideration is generally received in the first quarter of the subsequent year. |
Derivative financial instruments | Derivative financial instruments The Company manages the interest rate risk associated with its outstanding interest rate lock commitments and loans held for sale by entering into derivative loan instruments such as forward loan commitments, mandatory delivery commitments, options and future contracts, whereby the Company maintains the right to deliver residential loans to purchasers in the future at a specified yield. Fair value is based upon estimated amounts that the Company would receive or pay to terminate the commitment at the reporting date. The Company takes into account various factors and strategies in determining the portion of the mortgage pipeline it wants to economically hedge. Management expects the derivatives used to manage interest rate risk will experience changes in fair value opposite to changes in the fair value of the derivative loan commitments and loans held for sale, thereby reducing earnings volatility. |
Reclassifications | Reclassifications ● Gross commission income is comprised of revenues from the Real Estate Brokerage segment which were previously recorded in revenue ● Other service revenue is comprised of revenues not included in the Real Estate Brokerage segment which were previously recorded in revenue ● Commission and other agent-related costs is comprised of the direct costs to fulfill the services from the Real Estate Brokerage segment which were previously recorded in cost of revenue ● Operations and support are comprised of the direct costs to fulfill the services not included in the Real Estate Brokerage segment which were previously recorded in cost of revenue ● Depreciation and amortization represent the depreciation charged on the Company’s fixed assets and intangible assets which were previously recorded in general and administrative expenses. |
Recently Implemented Accounting Pronouncements | Recently Implemented Accounting Pronouncements In December 2019, the FASB issued ASU No. 2019-12, “Simplifying the Accounting for Income Taxes”. The provisions of ASU 2019-12 include eliminating certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. The guidance is effective for the reporting period beginning after December 15, 2020, and the interim periods therein. The Company adopted this standard effective January 1, 2021 and the application of ASU 2019-12 did not have a material impact on the Company's condensed consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Business Acquisition [Line Items] | |
Schedule of supplemental pro forma financial Information | Nine months ended September 30, 2021 2020 Revenue $ 240,282 $ 136,667 Net loss $ (15,709) $ (697) Net loss per share (basic) $ (1.07) $ (0.07) |
E4:9 | |
Business Acquisition [Line Items] | |
Schedule of purchase consideration and the fair values of the assets and liabilities | The total purchase consideration and the fair values of the assets and liabilities at the acquisition date were as follows (amount in thousands): Recognized amounts of identifiable assets acquired and liabilities assumed Cash $ 2,843 Accounts receivable 958 Mortgage loans held for sale 8,147 Derivative assets 90 Prepaid and other current assets 122 Property & equipment 356 Intangible assets 11,780 Lease right of use assets 1,498 Other long-term assets 7 Total identifiable assets acquired 25,801 Accounts payable and accrued liabilities 938 Escrow liabilities 75 Derivative liabilities 120 Warehouse lines of credit 7,958 Notes payable 486 Lease liability, current portion 337 Lease liability, net of current portion 1,161 Deferred tax liabilities 2,686 Total liabilities assumed 13,761 Total identifiable net assets 12,040 Goodwill 14,418 Net assets acquired $ 26,458 |
LiveBy | |
Business Acquisition [Line Items] | |
Schedule of purchase consideration and the fair values of the assets and liabilities | The total purchase consideration and the fair values of the assets and liabilities at the acquisition date were as follows (amount in thousands): Recognized amounts of identifiable assets acquired and liabilities assumed Cash $ 516 Accounts receivable 138 Intangible assets 4,920 Prepaid and other current assets 2 Total identifiable assets acquired 5,576 Deferred tax liabilities 543 Accounts payable and accrued liabilities 167 Total liabilities assumed 710 Total identifiable net assets 4,866 Goodwill 4,115 Net assets acquired $ 8,981 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Property and Equipment, Net | |
Schedule of property and equipment, net | Property and equipment, net consisted of the following at the dates indicated (amount in thousands): September 30, 2021 December 31, 2020 Vehicles $ — $ 119 Computers and equipment 453 139 Furniture and fixtures 610 44 Leasehold improvements 132 4 Total property and equipment 1,195 306 Accumulated depreciation (188) (151) Total property and equipment, net $ 1,007 $ 155 |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Intangible Assets, Net | |
Schedule of components of intangible assets, net | Intangible assets, net consisted of the following at the dates indicated (amount in thousands): September 30, 2021 Gross Carrying Accumulated Net Carrying Amount Amortization Value Trade names $ 6,326 $ (562) $ 5,764 Software development 8,182 (852) 7,330 Customer relationships 8,180 (314) 7,866 Agent relationships 2,670 (84) 2,586 Know-how 430 (18) 412 $ 25,788 $ (1,830) $ 23,958 December 31, 2020 Gross Carrying Accumulated Net Carrying Amount Amortization Value Trade names $ 166 $ (1) $ 165 Software development 921 (164) 758 $ 1,087 $ (165) $ 922 |
Schedule of estimated future amortization expense for definite-lived intangible assets | As of September 30, 2021, the estimated future amortization expense for definite-lived intangible assets was (amount in thousands): Years Ended December 31, 2021 (remaining) $ 924 2022 3,802 2023 3,701 2024 3,588 2025 3,353 Thereafter 8,590 Total $ 23,958 |
Goodwill (Tables)
Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Goodwill. | |
Schedule of changes in the carrying value of goodwill | The changes in the carrying value of goodwill by segment as of September 30, 2021 are as noted in the table below (amount in thousands): Real Estate Brokerage Mortgage Technology Other (a) Total Balance at December 31, 2020 $ — $ — $ — $ 799 $ 799 Goodwill acquired during the period 1,009 7,400 4,115 7,019 19,543 Balance at September 30, 2021 $ 1,009 $ 7,400 $ 4,115 $ 7,818 $ 20,342 (a) |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accrued Liabilities | |
Schedule of components of accrued liabilities | Accrued liabilities consisted of the following at the dates indicated (amount in thousands): September 30, 2021 December 31, 2020 Deferred annual fee $ 659 $ 293 Due to sellers 1,477 — Accrued compensation 1,094 202 Other accrued liabilities 1,755 570 Total accrued liabilities $ 4,985 $ 1,065 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Debt | |
Schedule of debt | Long-term debt consisted of the following at the dates indicated (amount in thousands): September 30, 2021 December 31, 2020 Paycheck Protection Program Loan $ 303 $ 354 Small Business Administration Loan 171 150 Note Payable 883 — Loan Payable - Automobile Loan — 35 Total debt 1,357 539 Less current portion of the Paycheck Protection Program Loan (303) (237) Less current portion of the Small Business Administration Loan (25) (2) Less current portion of Note Payable (883) — Less current portion of the Loan Payable — (17) Long-term debt, net of current portion $ 146 $ 283 |
Fair Value Measurements (Table)
Fair Value Measurements (Table) | 9 Months Ended |
Sep. 30, 2021 | |
Fair Value Measurements | |
Schedule of financial assets that are measured at fair value on a recurring basis | The following are the major categories of assets and liabilities measured at fair value on a recurring basis as of September 30, 2021 (amount in thousands): Level 1 Level 2 Level 3 Total Mortgage loans held for sale $ — $ 10,674 $ — $ 10,674 Derivative assets — — 48 48 Derivative liabilities — — (17) (17) $ — $ 10,674 $ 31 $ 10,705 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Leases | |
Schedule of lease cost | The table below presents certain information related to the lease costs for the Company’s operating leases for the periods indicated (amount in thousands): Three months ended September 30, Nine months ended September 30, 2021 2020 2021 2020 Components of total lease costs: Operating lease expense $ 296 $ 48 $ 589 $ 118 Short-term lease expense 120 12 244 47 Total lease cost $ 416 $ 60 $ 833 $ 165 |
Schedule of weighted average remaining lease term and the weighted average discount rate for the Company's operating leases | September 30, 2021 December 31, 2020 Weighted average remaining lease term (in years) - operating leases 5.17 3.37 Weighted average discount rate - operating leases 5.92 % 7.67 % |
Schedule of future lease payments | Future lease payments included in the measurement of lease liabilities on the consolidated balance sheet as of September 30, 2021, for the following five fiscal years and thereafter were as follows (amount in thousands): Operating Years Ended December 31, Leases 2021 (remaining) $ 287 2022 1,119 2023 1,047 2024 968 2025 847 2026 and thereafter 1,103 Total minimum lease payments $ 5,371 Less effects of discounting (787) Present value of future minimum lease payments $ 4,584 |
Share-based Compensation (Table
Share-based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Compensation | |
Summary of activity related to restricted stock awards | Weighted Average Grant Shares Date Fair Value Nonvested at December 31, 2020 390,787 $ 13.56 Granted 230,976 37.22 Vested (67,816) (29.87) Forfeited (23,950) (12.90) Nonvested at September 30, 2021 529,997 $ 10.90 |
Summary of stock option activity under the Plans | Weighted Average Weighted Remaining Options Average Contractual Term Aggregate Outstanding Exercise Price in Years intrinsic value (in thousands) Balance at December 31, 2020 47,332 $ 8.03 8.8 $ 1,326 Granted 13,638 44.00 Exercised (16,974) 4.71 Balance at September 30, 2021 43,996 $ 20.46 8.5 $ 510 Options exercisable at September 30, 2021 20,156 $ 4.71 7.5 $ 433 |
Summary of stock based compensation | Stock based compensation related to the Company’s stock plans are as follows (amount in thousands): Three months ended Nine months ended September 30, September 30, 2021 2020 2021 2020 General and administrative $ 295 $ 97 $ 1,811 $ 322 Commission and other agent-related cost 474 — 1,022 — Total stock-based compensation $ 769 $ 97 $ 2,833 $ 322 |
Net (Loss) Income per Share A_2
Net (Loss) Income per Share Attributable to Common Stock (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Net (Loss) Income per Share Attributable to Common Stock | |
Summary of basic and diluted net loss | Three months ended Nine months ended September 30, September 30, 2021 2020 2021 2020 Net loss $ (3,373) $ (184) $ (8,865) $ (66) Weighted-average basic shares outstanding 14,312,675 12,156,111 13,948,862 10,721,917 Effect of dilutive securities: Unvested restricted stock awards — — — — Stock options — — — — Weighted-average diluted shares outstanding 14,312,675 12,156,111 13,948,862 10,721,917 Net loss per share - basic and diluted $ (0.24) $ (0.02) $ (0.64) $ (0.01) |
Summary of outstanding shares of common stock equivalents were excluded from the computation of the diluted net loss per share attributable to common stock | Three months ended Nine months ended September 30, September 30, 2021 2020 2021 2020 Stock options 43,996 37,130 43,966 37,130 Unvested restricted stock awards 529,997 214,329 529,997 214,329 Common stock warrants 240,100 240,100 240,100 240,100 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting | |
Summary of key operating data for the reportable segments | Revenue Three months ended Nine months ended September 30, September 30, 2021 2020 2021 2020 Real Estate Brokerage $ 95,300 $ 55,848 $ 224,702 $ 123,375 Mortgage 2,623 — 4,125 — Technology 679 — 1,278 — Corporate and other services (a) 2,338 — 4,664 — Total Company $ 100,940 $ 55,848 $ 234,769 $ 123,375 Adjusted EBITDA Three months ended Nine months ended September 30, September 30, 2021 2020 2021 2020 Real Estate Brokerage $ 199 $ 6 $ 188 $ 469 Mortgage (101) — (991) — Technology 56 — (566) — Total Segment Adjusted EBITDA 154 6 (1,369) 469 Corporate and other services (a) (1,961) — (4,755) — Total Company Adjusted EBITDA $ (1,807) $ 6 $ (6,124) $ 469 Less: (931) (45) (1,778) (108) Other income (expense), net 102 (16) 190 (71) Income tax benefit (expense) 210 (32) 2,820 (34) Stock based compensation (770) (97) (2,833) (322) Transaction-related costs (177) — (1,140) — Net loss $ (3,373) $ (184) $ (8,865) $ (66) (a) Transactions between segments are eliminated in consolidation. Such amounts are eliminated through the Corporate and Other services line. |
Description of Business and N_2
Description of Business and Nature of Operations (Details) - USD ($) | Jun. 30, 2021 | Mar. 01, 2021 |
Red Barn | ||
Subsidiary, Sale of Stock [Line Items] | ||
Number of growing regional brokerage agents | 230 | |
Epic | ||
Subsidiary, Sale of Stock [Line Items] | ||
Number of growing regional brokerage agents | 350 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
COVID-19 Risks, Impacts and Uncertainties | |||||
Net income (loss) | $ (3,373) | $ (184) | $ (8,865) | $ (66) | |
Cash and cash equivalents | $ 8,753 | $ 30,993 | 8,753 | 30,993 | $ 28,577 |
Proceeds from the issuance of common stock | $ 80 | $ 83 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Intangible Assets, Net (Details) | 9 Months Ended |
Sep. 30, 2021 | |
Trade names | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Useful Life (Years) | 10 years |
Agent Relationships | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Useful Life (Years) | 7 years |
Customer Relationships | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Useful Life (Years) | 8 years |
Know-how Relationships | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Useful Life (Years) | 5 years |
Software development | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Useful Life (Years) | 5 years |
Internally developed software | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Useful Life (Years) | 7 years |
Maximum | Software development | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Useful Life (Years) | 7 years |
Minimum | Software development | |
Finite-Lived Intangible Assets [Line Items] | |
Estimated Useful Life (Years) | 5 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Goodwill (Details) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2021USD ($) | Sep. 30, 2021USD ($)item | |
Summary of Significant Accounting Policies | ||
Number of reporting units | item | 6 | |
Impairment of goodwill | $ | $ 0 | $ 0 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Revenue Recognition (Details) | 9 Months Ended |
Sep. 30, 2021 | |
Summary of Significant Accounting Policies | |
Notice in days for cancellation of contract | 30 days |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Practical (Details) | 9 Months Ended |
Sep. 30, 2021 | |
Practical expedient | |
Practical expedient | true |
Acquisitions - Acquisition of N
Acquisitions - Acquisition of Naberly (Details) - Naberly - USD ($) $ in Millions | Mar. 01, 2021 | Dec. 31, 2020 |
Asset Acquisition [Line Items] | ||
Cash consideration | $ 2.7 | |
Transaction costs | 0.1 | |
Acquisition cost, including transaction costs | $ 2.8 | |
Loans receivable, outstanding principal amount | $ 0.2 | |
Interest rate | 2.00% |
Acquisitions - Schedule of Acqu
Acquisitions - Schedule of Acquisition of E4:9 (Details) - USD ($) $ in Thousands | Apr. 16, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 |
Business Acquisition [Line Items] | ||||||
Common stock consideration | $ 25,312 | |||||
Goodwill | $ 20,342 | 20,342 | $ 799 | |||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||
Goodwill | 20,342 | 20,342 | $ 799 | |||
Revenue | 100,940 | $ 55,848 | 234,769 | $ 123,375 | ||
Net loss | (3,373) | (184) | $ (8,865) | (66) | ||
Customer Relationships | ||||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||
Estimated useful life | 8 years | |||||
Trade names | ||||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||
Estimated useful life | 10 years | |||||
Know-how Relationships | ||||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||
Estimated useful life | 5 years | |||||
Technology | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | 4,115 | $ 4,115 | ||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||
Goodwill | 4,115 | 4,115 | ||||
Revenue | 679 | 1,278 | 0 | |||
Real Estate Brokerage | ||||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||
Revenue | 95,300 | $ 55,848 | 224,702 | 123,375 | ||
Mortgage | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | 7,400 | 7,400 | ||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||
Goodwill | 7,400 | 7,400 | ||||
Revenue | $ 2,623 | 4,125 | $ 0 | |||
E4:9 | ||||||
Business Acquisition [Line Items] | ||||||
Percentage of outstanding capital acquired | 100.00% | |||||
Cash consideration | $ 9,800 | |||||
Common stock consideration | 16,600 | |||||
Total purchase price | 26,500 | |||||
Goodwill | 14,418 | |||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||
Cash | 2,843 | |||||
Accounts receivable | 958 | |||||
Mortgage loans held for sale | 8,147 | |||||
Derivative assets | 90 | |||||
Prepaid and other current assets | 122 | |||||
Property & equipment | 356 | |||||
Intangible assets | 11,780 | |||||
Lease right of use assets | 1,498 | |||||
Other long term assets | 7 | |||||
Total identifiable assets acquired | 25,801 | |||||
Accounts payable and accrued liabilities | 938 | |||||
Escrow liabilities | 75 | |||||
Derivative liabilities | 120 | |||||
Warehouse lines of credit | 7,958 | |||||
Notes payable | 486 | |||||
Lease liability, current portion | 337 | |||||
Lease liability, net of current portion | 1,161 | |||||
Deferred tax liabilities | 2,686 | |||||
Total liabilities assumed | 13,761 | |||||
Total identifiable net assets | 12,040 | |||||
Goodwill | 14,418 | |||||
Net assets acquired | 26,458 | |||||
Acquisition related costs | 300 | |||||
Intangible assets | 11,780 | |||||
Revenue | 4,000 | 6,900 | ||||
Net loss | 1,000 | $ 2,600 | ||||
E4:9 | Customer Relationships | ||||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||
Intangible assets | 6,200 | |||||
Intangible assets | $ 6,200 | |||||
Estimated useful life | 8 years | |||||
E4:9 | Trade names | ||||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||
Intangible assets | $ 5,200 | |||||
Intangible assets | $ 5,200 | |||||
Estimated useful life | 10 years | |||||
E4:9 | Know-how Relationships | ||||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||
Intangible assets | $ 400 | |||||
Intangible assets | $ 400 | |||||
Estimated useful life | 5 years | |||||
E4:9 | Mortgage | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | $ 7,400 | |||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||
Goodwill | 7,400 | |||||
E4:9 | Other service revenue. | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | 7,000 | |||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||
Goodwill | $ 7,000 |
Acquisitions - Schedule of Ac_2
Acquisitions - Schedule of Acquisition of LiveBy, Inc. (Details) - USD ($) $ in Thousands | Apr. 20, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 |
Business Acquisition [Line Items] | ||||||||
Common stock consideration | $ 25,312 | |||||||
Goodwill | $ 20,342 | 20,342 | $ 799 | |||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||||
Goodwill | 20,342 | 20,342 | $ 799 | |||||
Revenue | 100,940 | $ 55,848 | 234,769 | $ 123,375 | ||||
Net loss | $ (3,373) | $ (184) | (8,865) | $ (66) | ||||
LiveBy | ||||||||
Business Acquisition [Line Items] | ||||||||
Percentage of outstanding capital acquired | 100.00% | |||||||
Cash consideration | $ 3,400 | |||||||
Common stock consideration | 5,600 | |||||||
Total purchase price | 9,000 | |||||||
Goodwill | 4,115 | |||||||
Recognized amounts of identifiable assets acquired and liabilities assumed | ||||||||
Cash | 516 | |||||||
Accounts receivable | 138 | |||||||
Prepaid and other current assets | 2 | |||||||
Trade names | 4,920 | |||||||
Total identifiable assets acquired | 5,576 | |||||||
Accounts payable and accrued liabilities | 167 | |||||||
Deferred tax liabilities | 543 | |||||||
Total liabilities assumed | 710 | |||||||
Total identifiable net assets | 4,866 | |||||||
Goodwill | 4,115 | |||||||
Net assets acquired | 8,981 | |||||||
Acquisition related costs | $ 200 | $ 200 | ||||||
Revenue | 600 | 1,000 | ||||||
Net loss | $ 100 | $ 100 |
Acquisitions - Supplemental Pro
Acquisitions - Supplemental Pro Forma Financial Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Acquisitions | ||
Revenue | $ 240,282 | $ 136,667 |
Net Loss | $ (15,709) | $ (697) |
Net loss per share (basic) | $ (1.07) | $ (0.07) |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | |
Property and Equipment, Net | |||
Total property and equipment | $ 1,195 | $ 1,195 | $ 306 |
Accumulated depreciation | (188) | (188) | (151) |
Total property and equipment, net | 1,007 | 1,007 | 155 |
Depreciation expense | 100 | 100 | |
Vehicles | |||
Property and Equipment, Net | |||
Total property and equipment | 119 | ||
Computers and equipment | |||
Property and Equipment, Net | |||
Total property and equipment | 453 | 453 | 139 |
Furniture and fixtures | |||
Property and Equipment, Net | |||
Total property and equipment | 610 | 610 | 44 |
Leasehold improvements | |||
Property and Equipment, Net | |||
Total property and equipment | $ 132 | $ 132 | $ 4 |
Intangible Assets, Net (Details
Intangible Assets, Net (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 25,788 | $ 1,087 |
Accumulated Amortization | (1,830) | (165) |
Net Carrying Value | 23,958 | 922 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 6,326 | 166 |
Accumulated Amortization | (562) | (1) |
Net Carrying Value | 5,764 | 165 |
Software development | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 8,182 | 921 |
Accumulated Amortization | (852) | (164) |
Net Carrying Value | 7,330 | $ 758 |
Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 8,180 | |
Accumulated Amortization | (314) | |
Net Carrying Value | 7,866 | |
Agent Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 2,670 | |
Accumulated Amortization | (84) | |
Net Carrying Value | 2,586 | |
Know-how | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 430 | |
Accumulated Amortization | (18) | |
Net Carrying Value | $ 412 |
Intangible Assets, Net - Future
Intangible Assets, Net - Future amortization expense of intangible assets (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Intangible Assets, Net | ||
2021 (remaining) | $ 924 | |
2022 | 3,802 | |
2023 | 3,701 | |
2024 | 3,588 | |
2025 | 3,353 | |
Thereafter | 8,590 | |
Total | $ 23,958 | $ 922 |
Intangible Assets, Net - Additi
Intangible Assets, Net - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
Sep. 30, 2021 | Sep. 30, 2021 | |
Intangible Assets, Net | ||
Amortization expense for capitalized software and trade names | $ 0.9 | $ 1.7 |
Goodwill (Details)
Goodwill (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | |
Carrying Value | ||
Beginning balance | $ 799,000 | |
Goodwill acquired during the period | 19,543,000 | |
Ending balance | 20,342,000 | |
Accumulated impairment charges | 0 | $ 0 |
Technology | ||
Carrying Value | ||
Goodwill acquired during the period | 4,115,000 | |
Ending balance | 4,115,000 | |
Operating segments | ||
Carrying Value | ||
Beginning balance | 0 | |
Goodwill acquired during the period | 1,009,000 | |
Ending balance | 1,009,000 | |
Mortgage | ||
Carrying Value | ||
Goodwill acquired during the period | 7,400,000 | |
Ending balance | 7,400,000 | |
Other | ||
Carrying Value | ||
Beginning balance | 799,000 | |
Goodwill acquired during the period | 7,019,000 | |
Ending balance | $ 7,818,000 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Accrued Liabilities | ||
Deferred annual fee | $ 659 | $ 293 |
Accrued compensation | 1,094 | 202 |
Due to sellers | 1,477 | |
Other accrued liabilities | 1,755 | 570 |
Total accrued liabilities | $ 4,985 | $ 1,065 |
Warehouse Lines of Credit (Deta
Warehouse Lines of Credit (Details) - USD ($) | 9 Months Ended | ||
Sep. 30, 2021 | Jul. 31, 2021 | Dec. 31, 2020 | |
Line of Credit Facility [Line Items] | |||
Line of credit, Outstanding, current | $ 10,305,000 | ||
Liquid assets | 28,826,000 | $ 32,856,000 | |
Libor interest rate | 2.50% | ||
Warehousing credit and security agreement | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | 15,000,000 | ||
Line of credit, Outstanding, current | $ 0 | ||
Libor interest rate | 2.09% | ||
Debt-to-tangible net worth ratio | 15.00% | ||
Tangible net worth | $ 2,300,000 | ||
Warehousing credit and security agreement | Minimum | |||
Line of Credit Facility [Line Items] | |||
Liquid assets | $ 1,000,000 | ||
Warehousing credit and security agreement | Prime rate | |||
Line of Credit Facility [Line Items] | |||
Variable rate, Basis spread | 0.75% | ||
Prime rate, Basis spread | 3.25 | ||
Variable Interest Rate | 3.85% | ||
Warehousing credit and security agreement | London Interbank Offered Rate (LIBOR) | |||
Line of Credit Facility [Line Items] | |||
Libor interest rate | 2.00% | ||
Warehousing credit and security agreement | London Interbank Offered Rate (LIBOR) | Minimum | |||
Line of Credit Facility [Line Items] | |||
Libor interest rate | 2.00% | ||
Warehousing credit and security agreement | London Interbank Offered Rate (LIBOR) | Maximum | |||
Line of Credit Facility [Line Items] | |||
Libor interest rate | 3.50% | ||
Master loan agreement | |||
Line of Credit Facility [Line Items] | |||
Variable Interest Rate | 3.625% | ||
Maximum borrowing capacity | $ 15,000,000 | ||
Line of credit, Outstanding, current | 4,100,000 | ||
Master loan agreement | Minimum | |||
Line of Credit Facility [Line Items] | |||
Liquid assets | 1,000,000 | ||
Mortgage participation purchase agreement | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 25,000,000 | ||
Interest Rate | 3.50% | ||
Line of credit, Outstanding, noncurrent | $ 6,200,000 | ||
Mortgage participation purchase agreement | Minimum | |||
Line of Credit Facility [Line Items] | |||
Liquid assets | $ 1,000,000 |
Debt - Loan Payable and Notes P
Debt - Loan Payable and Notes Payable (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Long term debt | $ 1,357 | $ 539 |
Less current portion | (1,211) | (256) |
Debt, Net of current portion | 146 | 283 |
Loans Payables | Automobile Loan | ||
Debt Instrument [Line Items] | ||
Long term debt | 35 | |
Less current portion | (17) | |
Notes Payable | ||
Debt Instrument [Line Items] | ||
Long term debt | 883 | |
Less current portion | (883) | |
Notes Payable | Paycheck Protection Program Loan | ||
Debt Instrument [Line Items] | ||
Long term debt | 303 | 354 |
Less current portion | (303) | (237) |
Notes Payable | Small Business Administration Loan | ||
Debt Instrument [Line Items] | ||
Long term debt | 171 | 150 |
Less current portion | $ (25) | $ (2) |
Debt (Details)
Debt (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||||
Sep. 30, 2021 | Sep. 30, 2021 | Jul. 01, 2022 | Jul. 31, 2021 | Jul. 21, 2021 | Dec. 31, 2020 | Nov. 24, 2020 | Jun. 05, 2020 | May 31, 2020 | |
Debt Instrument [Line Items] | |||||||||
Interest rate per annum | 2.50% | ||||||||
Gain on extinguishment | $ 76 | $ 127 | |||||||
Note Payable | 1,357 | 1,357 | $ 539 | ||||||
Paycheck Protection Program Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Accrued and unpaid interest written off | 100 | ||||||||
PPP Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Accrued and unpaid interest written off | 100 | 100 | |||||||
Gain on extinguishment | 100 | 100 | |||||||
Notes Payable | |||||||||
Debt Instrument [Line Items] | |||||||||
Borrowed amount | $ 900 | ||||||||
Non-interest-bearing promissory note | 200 | 200 | |||||||
Note Payable | 883 | 883 | |||||||
Notes Payable | Subsequent events | |||||||||
Debt Instrument [Line Items] | |||||||||
Non-interest-bearing promissory note | $ 400 | ||||||||
Notes Payable | Small Business Administration Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate per annum | 3.75% | ||||||||
Borrowed amount | $ 200 | ||||||||
Note Payable | 171 | 171 | 150 | ||||||
Notes Payable | Paycheck Protection Program Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate per annum | 1.00% | ||||||||
Borrowed amount | $ 300 | ||||||||
Note Payable | $ 303 | $ 303 | $ 354 | ||||||
Notes Payable | PPP Loan | Verus Title Inc. | |||||||||
Debt Instrument [Line Items] | |||||||||
Borrowed amount | $ 100 | ||||||||
Notes Payable | PPP Loan | E4:9 | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate per annum | 1.00% | 1.00% | |||||||
Borrowed amount | $ 100 | $ 100 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Fair Value, Recurring $ in Thousands | Sep. 30, 2021USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Mortgage loans held for sale | $ 10,674 |
Derivative assets | 48 |
Derivative liabilities | (17) |
Total | 10,705 |
Level 2 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Mortgage loans held for sale | 10,674 |
Total | 10,674 |
Level 3 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative assets | 48 |
Derivative liabilities | (17) |
Total | $ 31 |
Leases (Details)
Leases (Details) | 9 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | |
Lessee, Lease, Description [Line Items] | ||
Option to extend | true | |
Residual value guarantee | false | |
Weighted average remaining lease term (in years) - operating leases | 5 years 2 months 1 day | 3 years 4 months 13 days |
Weighted average discount rate - operating leases | 5.92% | 7.67% |
Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Lease term | 1 year | |
Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Lease term | 7 years |
Leases - Lease costs (Details)
Leases - Lease costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Leases | ||||
Operating lease expense | $ 296 | $ 48 | $ 589 | $ 118 |
Short-term lease expense | 120 | 12 | 244 | 47 |
Total lease cost | $ 416 | $ 60 | $ 833 | $ 165 |
Leases - Undiscounted cash flow
Leases - Undiscounted cash flow (Details) $ in Thousands | Sep. 30, 2021USD ($) |
Future Minimum Lease Payments | |
2021 (remaining) | $ 287 |
2022 | 1,119 |
2023 | 1,047 |
2024 | 968 |
2025 | 847 |
2026 and thereafter | 1,103 |
Total minimum lease payments | 5,371 |
Less effects of discounting | (787) |
Total lease liability | $ 4,584 |
Share-based Compensation (Detai
Share-based Compensation (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended |
Mar. 31, 2021 | Sep. 30, 2021 | Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of awards granted (in shares) | 230,976 | ||
Fair value of awards granted (in dollars per share) | $ 29.87 | ||
Exercise price of stock options granted (in dollars per share) | $ 44 | ||
Capitalized of stock-based compensation expense | $ 0.6 | ||
2017 Stock Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares authorized | 3,182,335 | 3,182,335 | |
2019 Omnibus Stock Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares authorized | 1,060,778 | 1,060,778 | |
Vesting period | 1 year | ||
Exercise price of stock options granted (in dollars per share) | $ 44 | ||
Vesting Tranche One | 2019 Omnibus Stock Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of awards granted (in shares) | 4,564 | ||
Vesting Tranche One | 2019 Plan, in connection with the acquisitions of Naberly and Red Barn | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of awards granted (in shares) | 10,478 | ||
Vesting Tranche Two | 2019 Omnibus Stock Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of awards granted (in shares) | 77,439 | ||
Vesting Tranche Two | 2019 Plan, in connection with the acquisitions of Naberly and Red Barn | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of awards granted (in shares) | 34,090 | ||
Vesting period | 18 months | ||
Unvested restricted stock awards | 2019 Omnibus Stock Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of awards granted (in shares) | 82,003 | ||
Fair value of awards granted (in dollars per share) | $ 32.87 | ||
Vesting period | 3 years | ||
Unvested restricted stock awards | 2019 Plan, in connection with the acquisitions of Naberly and Red Barn | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of awards granted (in shares) | 44,568 | ||
Fair value of awards granted (in dollars per share) | $ 44 | ||
Unvested restricted stock awards | Vesting Tranche One | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 1 year |
Share-based Compensation - Move
Share-based Compensation - Movements in Restricted Stock Awards (Details) - $ / shares | 9 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | |
Shares | ||
Non-vested at beginning | 390,787 | |
Granted | 230,976 | |
Vested | (67,816) | |
Forfeited | (23,950) | |
Non-vested at ending | 529,997 | |
Weighted-Average Grant Date Fair Value | ||
Non-vested at beginning | $ 10.90 | $ 13.56 |
Granted | 37.22 | |
Vested | (29.87) | |
Forfeited | (12.90) | |
Non-vested at ending | $ 10.90 | $ 13.56 |
Share-based compensation - Summ
Share-based compensation - Summary of stock option activity under the Plans (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 31, 2020 | Sep. 30, 2021 |
Options Outstanding | ||
Beginning balance | 47,332 | |
Granted | 13,638 | |
Exercised | (16,974) | |
Ending balance | 47,332 | 43,996 |
Options exercisable | 20,156 | |
Weighted Average Exercise Price | ||
Beginning balance | $ 8.03 | |
Granted | 44 | |
Exercised | 4.71 | |
Ending balance | $ 8.03 | 20.46 |
Options exercisable | $ 4.71 | |
Weighted Average Remaining Contractual Term in Years | ||
Weighted average remaining contractual term | 8 years 9 months 18 days | 8 years 6 months |
Options exercisable | 7 years 6 months | |
Aggregate intrinsic value | ||
Beginning balance | $ 1,326 | |
Ending balance | $ 1,326 | 510 |
Options exercisable | $ 433 |
Share-based Compensation - Su_2
Share-based Compensation - Summary of stock based compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation | $ 769 | $ 97 | $ 2,833 | $ 322 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation | 295 | $ 97 | 1,811 | $ 322 |
Commission and other agent-related cost | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation | $ 474 | $ 1,022 |
Equity-classified Warrants - Is
Equity-classified Warrants - Issuance of warrants (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2021 | Aug. 04, 2020 | |
Equity-classified Warrants | |||
Underwriter Warrant to purchase shares | 0 | 240,100 | |
Warrant exercise price (in dollars per share) | $ 11 | ||
Equity issuance costs | $ 3,183 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Related Party Transactions | ||||
Revenue | $ 0.1 | $ 0.4 | ||
Marketing expense | $ 0.1 | $ 0.1 | $ 0.4 | $ 0.1 |
Net (Loss) Income per Share A_3
Net (Loss) Income per Share Attributable to Common Stock - Calculation of Basic and Diluted Net Loss per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Net (Loss) Income per Share Attributable to Common Stock | ||||
Net loss | $ (3,373) | $ (184) | $ (8,865) | $ (66) |
Weighted-average basic shares outstanding | 14,312,675 | 12,156,111 | 13,948,862 | 10,721,917 |
Weighted-average diluted shares outstanding | 14,312,675 | 12,156,111 | 13,948,862 | 10,721,917 |
Net loss per share - basic | $ (0.24) | $ (0.02) | $ (0.64) | $ (0.01) |
Net loss per share - diluted | $ (0.24) | $ (0.02) | $ (0.64) | $ (0.01) |
Net (Loss) Income per Share A_4
Net (Loss) Income per Share Attributable to Common Stock - Antidilutive Securities (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Stock option awards | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Common stock equivalents excluded from computation of diluted net loss per share attributable to common stock for the periods presented because their effect would have been anti-dilutive | 43,996 | 37,130 | 43,966 | 37,130 |
Unvested restricted stock awards | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Common stock equivalents excluded from computation of diluted net loss per share attributable to common stock for the periods presented because their effect would have been anti-dilutive | 529,997 | 214,329 | 529,997 | 214,329 |
Common stock warrants | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Common stock equivalents excluded from computation of diluted net loss per share attributable to common stock for the periods presented because their effect would have been anti-dilutive | 240,100 | 240,100 | 240,100 | 240,100 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Income Taxes | |||||
Federal net operating loss carryforwards | $ 9,200,000 | ||||
State net operating loss carryforwards | $ 4,500,000 | ||||
Unrecognized tax benefits | $ 0 | $ 0 | |||
Income tax (expense) | (210,000) | $ 32,000 | (2,820,000) | $ 33,500 | |
Net deferred tax liabilities | 3,200,000 | 3,200,000 | |||
Pre existing deferred tax assets | $ 1,600,000 | $ 1,600,000 |
Segment Reporting (Details)
Segment Reporting (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 100,940,000 | $ 55,848,000 | $ 234,769,000 | $ 123,375,000 |
Adjusted EBITDA | (1,807,000) | 6,000 | (6,124,000) | 469,000 |
Less: Depreciation and amortization | (931,000) | (45,000) | (1,778,000) | (108,000) |
Other income (expense), net | 102,000 | (16,000) | 190,000 | (71,000) |
Income tax benefit (expense) | 210,000 | (32,000) | 2,820,000 | (33,500) |
Share based compensation | (770,000) | (97,000) | (2,833,000) | (322,000) |
Transaction-related costs | (177,000) | (1,140,000) | 0 | |
Net loss | (3,373,000) | (184,000) | (8,865,000) | (66,000) |
Technology | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 679,000 | 1,278,000 | 0 | |
Real Estate Brokerage | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 95,300,000 | 55,848,000 | 224,702,000 | 123,375,000 |
Mortgage | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 2,623,000 | 4,125,000 | 0 | |
Corporate and other services | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 2,338,000 | 4,664,000 | 0 | |
Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted EBITDA | 154,000 | 6,000 | (1,369,000) | 469,000 |
Operating segments | Technology | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted EBITDA | 56,000 | (566,000) | 0 | |
Operating segments | Real Estate Brokerage | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted EBITDA | 199,000 | $ 6,000 | 188,000 | 469,000 |
Operating segments | Mortgage | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted EBITDA | (101,000) | (991,000) | 0 | |
Eliminated in consolidation | Corporate and other services | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted EBITDA | $ (1,961,000) | $ (4,755,000) | $ 0 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2021segment | |
Segment Reporting | |
Number of reporting segment | 3 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - Encompass | Sep. 30, 2021USD ($) |
Commitments And Contingencies Disclosure [Line items] | |
Adjusted net worth to maintained | $ 1,000,000 |
Net worth adjusted | 2,400,000 |
Liquid assets to maintained | $ 2,500,000 |
Percentage of required net worth Liquid assets for compliance | 20.00% |