Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 30, 2021 | Aug. 09, 2021 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-39021 | |
Entity Registrant Name | WM TECHNOLOGY, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 98-1605615 | |
Entity Address, Address Line One | 41 Discovery | |
Entity Address, City or Town | Irvine | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 92618 | |
City Area Code | 844 | |
Local Phone Number | 933-3627 | |
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 | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001779474 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Class A Common Stock, $0.0001 par value per share | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Class A Common Stock, $0.0001 par value per share | |
Trading Symbol | MAPS | |
Security Exchange Name | NASDAQ | |
Entity Common Stock, Shares Outstanding | 63,738,563 | |
Warrants, each whole warrant exercisable for one share of Class A Common Stock at an exercise price of $11.50 per share | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Warrants, each whole warrant exercisable for one share of Class A Common Stock at an exercise price of $11.50 per share | |
Trading Symbol | MAPSW | |
Security Exchange Name | NASDAQ | |
Class V Common Stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 65,502,347 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash | $ 91,662 | $ 19,919 |
Accounts receivable, net | 10,872 | 9,428 |
Prepaid expenses and other current assets | 18,110 | 4,820 |
Total current assets | 120,644 | 34,167 |
Property and equipment, net | 6,682 | 7,387 |
Goodwill | 3,961 | 3,961 |
Intangible assets, net | 4,055 | 4,505 |
Right-of-use assets | 38,779 | |
Deferred tax assets | 148,365 | 0 |
Other assets | 3,842 | 3,874 |
Total assets | 326,328 | 53,894 |
Current liabilities | ||
Accounts payable and accrued expenses | 25,512 | 12,651 |
Deferred revenue | 6,936 | 5,264 |
Deferred rent | 0 | 5,129 |
Operating lease liabilities, current portion | 5,052 | |
Notes payable to members | 0 | 205 |
Total current liabilities | 37,500 | 23,249 |
Operating lease liabilities, non-current portion | 42,206 | |
Tax receivable agreement liability | 126,150 | 0 |
Warrant liability | 156,187 | 0 |
Other long-term liabilities | 0 | 1,374 |
Total liabilities | 362,043 | 24,623 |
Commitments and contingencies (Note 4) | ||
Stockholders’ equity/Members’ equity | ||
Preferred Stock - $0.0001 par value; 75,000,000 shares authorized; — shares issued and outstanding at June 30, 2021 | 0 | |
Additional paid-in capital | (20,212) | |
Retained earnings | 5,249 | |
Total WM Technology, Inc. stockholders’ deficit | (14,950) | |
Noncontrolling interests | (20,765) | |
Members’ equity | 0 | 29,271 |
Total (deficit) equity | (35,715) | |
Total liabilities and (deficit) equity | 326,328 | $ 53,894 |
Class A Common Stock | ||
Stockholders’ equity/Members’ equity | ||
Common Stock | 6 | |
Class V Common Stock | ||
Stockholders’ equity/Members’ equity | ||
Common Stock | $ 7 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) | Jun. 30, 2021$ / sharesshares |
Statement of Financial Position [Abstract] | |
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 75,000,000 |
Preferred stock, shares issued (in shares) | 0 |
Preferred stock, shares outstanding (in shares) | 0 |
Class A Common Stock | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 |
Common stock, shares authorized (in shares) | 1,500,000,000 |
Common stock, shares issued (in shares) | 63,738,563 |
Common stock, shares outstanding (in shares) | 63,738,563 |
Class V Common Stock | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 |
Common stock, shares authorized (in shares) | 500,000,000 |
Common stock, shares issued (in shares) | 65,502,347 |
Common stock, shares outstanding (in shares) | 65,502,347 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Revenues | $ 46,931 | $ 38,755 | $ 88,085 | $ 70,965 |
Operating expenses | ||||
Cost of revenues | 1,908 | 1,856 | 3,765 | 3,463 |
Sales and marketing | 15,271 | 7,422 | 24,388 | 14,053 |
Product development | 10,271 | 6,694 | 18,139 | 13,402 |
General and administrative | 33,770 | 12,242 | 47,136 | 24,241 |
Depreciation and amortization | 988 | 990 | 1,990 | 1,989 |
Total operating expenses | 62,208 | 29,204 | 95,418 | 57,148 |
Operating (loss) income | (15,277) | 9,551 | (7,333) | 13,817 |
Other income (expenses) | ||||
Change in fair value of warrant liability | 37,791 | 0 | 37,791 | 0 |
Other expense, net | (6,069) | (158) | (6,041) | (615) |
Income before income taxes | 16,445 | 9,393 | 24,417 | 13,202 |
Benefit from income taxes | (392) | 0 | (151) | 0 |
Net income | 16,837 | 9,393 | 24,568 | 13,202 |
Net income attributable to noncontrolling interests | 12,574 | 0 | 20,305 | 0 |
Net income attributable to WM Technology, Inc. | $ 4,263 | $ 9,393 | $ 4,263 | $ 13,202 |
Class A Common Stock | ||||
Other income (expenses) | ||||
Basic income per share - Class A (in dollars per share) | $ 0.07 | $ 0.07 | ||
Diluted loss per share - Class A (in dollars per share) | $ (0.17) | $ (0.17) | ||
Weighted average basic shares outstanding - Class A (in shares) | 63,738,563 | 63,738,563 | ||
Weighted average diluted shares outstanding - Class A (in shares) | 71,347,746 | 71,347,746 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (DEFICIT) - USD ($) $ in Thousands | Total | Class A | Class V | Total WM Technology, Inc. Stockholders’ Deficit | Common StockClass A | Common StockClass V | Additional Paid-in Capital | Retained Earnings | Non-controlling Interests | Members’ Equity |
Members' Equity at Dec. 31, 2019 | $ 12,799 | |||||||||
Members' Equity [Roll Forward] | ||||||||||
Distributions to members | (3,123) | $ (3,123) | ||||||||
Repurchase of Class B Units | (90) | 90 | ||||||||
Net income | 3,809 | 3,809 | ||||||||
Members' Equity at Mar. 31, 2020 | 13,395 | |||||||||
Members' Equity at Dec. 31, 2019 | 12,799 | |||||||||
Members' Equity [Roll Forward] | ||||||||||
Net income | 13,202 | |||||||||
Members' Equity at Jun. 30, 2020 | 19,939 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 13,202 | |||||||||
Members' Equity at Mar. 31, 2020 | 13,395 | |||||||||
Members' Equity [Roll Forward] | ||||||||||
Distributions to members | (2,744) | (2,744) | ||||||||
Repurchase of Class B Units | (105) | (105) | ||||||||
Net income | 9,393 | 9,393 | ||||||||
Members' Equity at Jun. 30, 2020 | 19,939 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 9,393 | |||||||||
Members' Equity at Dec. 31, 2020 | 29,271 | |||||||||
Members' Equity [Roll Forward] | ||||||||||
Distributions to members | (10,513) | (10,513) | ||||||||
Repurchase of Class B Units | (106) | (106) | ||||||||
Net income | 7,731 | 7,731 | ||||||||
Members' Equity at Mar. 31, 2021 | 26,383 | |||||||||
Balance (in shares) at Mar. 31, 2021 | 0 | 0 | ||||||||
Balance at Mar. 31, 2021 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | ||||
Members' Equity at Dec. 31, 2020 | 29,271 | |||||||||
Members' Equity [Roll Forward] | ||||||||||
Net income | 4,263 | |||||||||
Members' Equity at Jun. 30, 2021 | 0 | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Net income | 24,568 | |||||||||
Balance (in shares) at Jun. 30, 2021 | 63,738,563 | 65,502,347 | 63,738,563 | 65,502,347 | ||||||
Balance at Jun. 30, 2021 | (35,715) | (14,950) | $ 6 | $ 7 | (20,212) | 5,249 | (20,765) | |||
Members' Equity at Mar. 31, 2021 | 26,383 | |||||||||
Members' Equity [Roll Forward] | ||||||||||
Distributions to members | (7,597) | (7,597) | ||||||||
Repurchase of Class B Units | (5,459) | (5,459) | ||||||||
Net income | 4,263 | |||||||||
Members' Equity at Jun. 30, 2021 | 0 | |||||||||
Balance (in shares) at Mar. 31, 2021 | 0 | 0 | ||||||||
Balance at Mar. 31, 2021 | 0 | $ 0 | $ 0 | 0 | 0 | 0 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Share-based compensation | 19,433 | 19,433 | ||||||||
Proceeds and shares issued in the Business Combination (Note 6) (in shares) | 63,738,563 | 65,502,347 | ||||||||
Proceeds and shares issued in the Business Combination (Note 6) | (85,312) | (19,213) | $ 6 | $ 7 | (20,212) | 986 | (45,425) | (20,674) | ||
Net income | 16,837 | 4,263 | 4,263 | 5,227 | $ 7,347 | |||||
Balance (in shares) at Jun. 30, 2021 | 63,738,563 | 65,502,347 | 63,738,563 | 65,502,347 | ||||||
Balance at Jun. 30, 2021 | (35,715) | (14,950) | $ 6 | $ 7 | (20,212) | 5,249 | (20,765) | |||
Members' Equity [Roll Forward] | ||||||||||
Net income | 9,500 | |||||||||
Members' Equity at Jun. 30, 2021 | 0 | |||||||||
Balance (in shares) at Jun. 30, 2021 | 63,738,563 | 65,502,347 | 63,738,563 | 65,502,347 | ||||||
Balance at Jun. 30, 2021 | $ (35,715) | $ (14,950) | $ 6 | $ 7 | $ (20,212) | $ 5,249 | $ (20,765) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Cash flows from operating activities | ||
Net income | $ 24,568 | $ 13,202 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 1,990 | 1,989 |
Change in fair value of warrant liability | (37,791) | 0 |
Impairment loss on right-of-use asset | 2,372 | 0 |
Share-based compensation | 19,433 | 0 |
Deferred tax assets | (392) | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (1,444) | (1,421) |
Prepaid expenses and other current assets | 3,691 | (508) |
Other assets | 32 | 491 |
Accounts payable and accrued expenses | 2,044 | (1,138) |
Deferred revenue | 1,672 | 1,790 |
Net cash provided by operating activities | 16,175 | 14,405 |
Cash flows from investing activities | ||
Purchases of property and equipment | (836) | (502) |
Net cash used in investing activities | (836) | (502) |
Cash flows from financing activities | ||
Proceeds from the Business Combination | 80,284 | 0 |
Payment of note payable | (205) | 0 |
Distributions to members | (18,110) | (5,867) |
Repurchase of Class B Units | (5,565) | (195) |
Net cash provided by (used in) financing activities | 56,404 | (6,062) |
Net increase in cash | 71,743 | 7,841 |
Cash – beginning of period | 19,919 | 4,968 |
Cash – end of period | 91,662 | 12,809 |
Supplemental disclosures of noncash financing activities | ||
Warranty liability assumed from the Business Combination | 193,978 | 0 |
Tax receivable agreement liability recognized in connection with the Business Combination | 126,150 | 0 |
Deferred tax assets recognized in connection with the Business Combination | 147,973 | 0 |
Other assets assumed from the Business Combination | $ 1,053 | $ 0 |
Business and Organization
Business and Organization | 6 Months Ended |
Jun. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Organization | Business and Organization WM Technology, Inc. (the “Company”) is a technology and software infrastructure provider to retailers and brands in the U.S. state-legal and Canadian cannabis markets. The Company also provides information on the cannabis plant and the industry and advocates for legalization. The Weedmaps listings marketplace provides consumers with information regarding cannabis retailers and brands, as well as the strain, pricing, and other information regarding locally available cannabis products, through the Company’s website and mobile apps, permitting product discovery and reservation of products for pickup by consumers or delivery to consumers by participating retailers. The Company sells its offerings in the United States, and the Company has a limited number of non-monetized listings in several international countries including Austria, Canada, Germany, the Netherlands, Spain, and Switzerland. Through December 31, 2020, the Company offered standard listing subscription clients access to a listing page on weedmaps.com in addition to free access to its SaaS solutions, including WM Orders, WM Dispatch, WM Exchange, WM Retail and WM Store, along with its API integrations with third-party point-of-sale (“POS”) systems. For access to the orders functionality, beginning in September 2019, standard listing clients were also then required to pay a fixed services fee per delivery order submitted which the Company imposed regardless of whether the proposed order was canceled or completed. As of January 1, 2021, the Company migrated all standard listing subscription clients to its new WM Business subscription package. Under this new subscription package, all retailers continue to receive access to a standard listing page and SaaS solutions. In addition, the Company began including access to WM Dashboard and eliminated the technology services fee on delivery orders as part of the transition to the new WM Business subscription package. The Company operates in the United States, Canada, and other foreign jurisdictions where medical and/or adult use cannabis is legal under state or applicable national law. The Company is headquartered in Irvine, California. Business Combination WM Technology, Inc. was initially incorporated in the Cayman Islands on June 7, 2019 under the name “Silver Spike Acquisition Corp.” (“Silver Spike”). Silver Spike was formed for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. On June 16, 2021 (the “Closing Date”), Silver Spike consummated the business combination (the “Business Combination”), pursuant to that certain Agreement and Plan of Merger, dated December 10, 2020 (the “Merger Agreement”), by and among Silver Spike, Silver Spike Merger Sub LLC, a Delaware limited liability company and a wholly owned direct subsidiary of Silver Spike Acquisition Corp. (“Merger Sub”), WM Holding Company, LLC, a Delaware limited liability company (when referred to in its pre-Business Combination capacity, “Legacy WMH” and following the Business Combination, “WMH LLC”), and Ghost Media Group, LLC, a Nevada limited liability company, solely in its capacity as the initial holder representative (the “Holder Representative”). On the Closing Date, and in connection with the closing of the Business Combination (the “Closing”), Silver Spike was domesticated and continues as a Delaware corporation, changing its name to WM Technology, Inc. The Company was reorganized into an Up-C structure, in which substantially all of the assets and business of the Company are held by WMH LLC and continue to operate through WMH LLC and its subsidiaries, and WM Technology, Inc.’s material assets are the equity interests of WMH LLC indirectly held by it. Legacy WMH was determined to be the accounting acquirer in the Business Combination, which was accounted for as a reverse recapitalization in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). |
Summary of significant accounti
Summary of significant accounting policies | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Summary of significant accounting policies | Summary of significant accounting policies The summary of significant accounting policies presented below is designed to assist in understanding the Company’s condensed consolidated financial statements. Such condensed consolidated financial statements and accompanying notes are the representations of the Company’s management, who is responsible for their integrity and objectivity. Management believes that these accounting policies conform to GAAP in all material respects, and have been consistently applied in preparing the accompanying condensed consolidated financial statements. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for quarterly reports on Form 10-Q and Article 10-1 of Regulation S-X. Accordingly, certain information and footnotes required by GAAP in annual financial statements have been omitted or condensed and these interim financial statements should be read in conjunction with the Company’s audited financial statements and accompanying notes included in the Company’s Registration Statement on Form S-1 filed with the SEC on July 8, 2021. The condensed financial statements of the Company include all adjustments of a normal recurring nature which, in the opinion of management, are necessary for a fair statement of the Company’s financial position as of June 30, 2021, and results of its operations and its cash flows for the interim periods presented. The results of operations for the six months ended June 30, 2021 are not necessarily indicative of the results to be expected for the entire year. There have been no significant changes in the Company’s accounting policies from those described in the Company’s audited consolidated financial statements and the related notes to those statements, other than the adoption of the lease accounting guidance. Pursuant to the Merger Agreement, the Business Combination was accounted for as a reverse recapitalization in accordance with GAAP (the “Reverse Recapitalization”). Under this method of accounting, Silver Spike was treated as the acquired company and Legacy WMH was treated as the acquirer for financial statement reporting purposes. Accordingly, for accounting purposes, the Reverse Recapitalization was treated as the equivalent of Legacy WMH issuing stock for the net assets of Silver Spike, accompanied by a recapitalization. Legacy WMH was determined to be the accounting acquirer based on evaluation of the following facts and circumstances: • Legacy WMH Class A Unit holders, through their ownership of the Class V Common Stock, have the greatest voting interest in the Company with over 50% of the voting interest; • Legacy WMH selected the majority of the new board of directors of the Company; • Legacy WMH senior management is the senior management of the Company; and • Legacy WMH is the larger entity based on historical operating activity and has the larger employee base. Thus, the financial statements included in this quarterly report reflect (i) the historical operating results of Legacy WMH prior to the Business Combination; (ii) the combined results of the WMH LLC and Silver Spike following the Business Combination; and (iii) the acquired assets and liabilities of Silver Spike stated at historical cost, with no goodwill or other intangible assets recorded. Principles of Consolidation The condensed consolidated financial statements include the accounts of WM Technology, Inc. and WM Holding Company, LLC and its subsidiaries, GMG Holdco, Inc., Weedmaps Media, LLC (“Weedmaps”), Ghost Management Group, LLC, WM Canada Holdings, Inc., WM Enterprise, LLC, WM Marketplace, LLC, Weedmaps Spain, S.LU., WM Retail, LLC, Grow One Software (Canada), Inc., Discovery Opco, LLC, WM Museum, LLC, WM Teal, LLC and Weedmaps Germany GmbH. All significant intercompany balance and transactions have been eliminated upon consolidation. Foreign Currency Assets and liabilities denominated in a foreign currency are translated into U.S. dollars using the exchange rates in effect at the balance sheet date. Revenue and expense accounts are translated at the average exchange rates during the periods. The impact of exchange rate fluctuations from translation of assets and liabilities is insignificant for the three and six months ended June 30, 2020 and 2021. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates made by management include, among others, the valuation of accounts receivable, the useful lives of long-lived assets, income taxes, website and internal-use software development costs, leases, valuation of goodwill and other intangible assets, valuation of warrant liability, deferred tax asset and tax receivable agreement liability, revenue recognition, stock-based compensation, and the recognition and disclosure of contingent liabilities. Risks and Uncertainties The Company operates in a relatively new industry where laws and regulations vary significantly by jurisdiction. Currently, several states permit medical or recreational use of cannabis; however, the use of cannabis is prohibited on a federal level in the United States. If any of the states that permit use of cannabis were to change their laws or the federal government was to actively enforce such prohibition, the Company’s business could be adversely affected. In addition, the Company’s ability to grow and meet its operating objectives depends largely on the continued legalization of cannabis on a widespread basis. There can be no assurance that such legalization will occur on a timely basis, or at all. Accounts Receivable Accounts receivable is recorded at the invoiced amount and does not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in existing accounts receivable. The allowance for doubtful accounts is reviewed on a monthly basis and we reserve for all balance in outstanding in excess of ninety days. Account balances are written off against the allowance when it is determined that it is probable that the receivable will not be recovered. The Company recorded an allowance for bad debt of $0.7 million as of June 30, 2021. Revenue Recognition The Company’s revenues are derived primarily from monthly subscriptions and additional offerings for access to the Company’s Weedmaps platform and the Company’s SaaS solutions. The Company recognizes revenue when the fundamental criteria for revenue recognition are met. The Company recognizes revenue by applying the following steps: the contract with the customer is identified; the performance obligations in the contract are identified; the transaction price is determined; the transaction price is allocated to the performance obligations in the contract; and revenue is recognized when (or as) the Company satisfies these performance obligations in an amount that reflects the consideration it expects to be entitled to in exchange for those services. Substantially all of the Company’s revenue is generated by providing standard listing and software subscription services and other paid listing subscriptions services, including featured listings, promoted deals, nearby listings and other display advertising to its customers. These arrangements are recognized over-time, generally during a month-to-month subscription period as the products are provided. The Company may also provide services to its customers, including access to the Company’s orders functionality, which are recognized at a point in time, typically when an order for delivery or pickup is submitted. The Company rarely needs to allocate the transaction price to separate performance obligations. In the rare case that allocation of the transaction price is needed, the Company recognizes revenue in proportion to the standalone selling prices of the underlying services at contract inception. Starting on January 1, 2021, the Company eliminated the technology services fee charge related to the Company’s orders functionality. Deferred revenue primarily consists of billings or payments received in advance of revenue recognition from subscription offerings, as described above, and is recognized as the revenue recognition criteria are met. The prior year deferred revenue balance of $5.3 million was fully recognized in the first quarter of fiscal year 2021, and the deferred revenue balance as of June 30, 2021 of $6.9 million is expected to be fully recognized within the next twelve months. The Company generally invoices customers and receives payment on an upfront basis and payments do not include significant financing components or variable consideration and there are generally no rights of return or refunds after the subscription period has passed. The following table summarizes the Company’s disaggregated net revenue information (in thousands): Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 Revenues recognized over time (1) $ 46,931 $ 36,790 $ 88,085 $ 68,156 Revenues recognized at a point in time (2) — 1,965 — 2,809 Total revenues $ 46,931 $ 38,755 $ 88,085 $ 70,965 ________________ (1) Revenues from listing subscription services, featured listings and other advertising products. (2) Revenues from use of orders functionality. The following table summarizes the Company’s U.S. and foreign revenues (in thousands): Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 U.S. revenues $ 46,931 $ 30,351 $ 88,085 $ 56,398 Foreign revenues — 8,404 — 14,567 Total revenues $ 46,931 $ 38,755 $ 88,085 $ 70,965 All foreign revenues were generated in Canada. During the second half of fiscal 2020, the Company discontinued its services to Canada-based retail operator clients who failed to provide valid license information, similar to the transition the Company implemented in California at the end of fiscal 2019. Following the completion of the discontinuation of such services, all revenue has been generated in the United States. Income Taxes The Company uses the asset and liability method of accounting for income taxes under ASC 740 - Income Taxes. Under the guidance, deferred tax assets and liabilities are recognized for the future tax consequences of (i) temporary differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities and (ii) operating loss and tax credit carryforwards. Deferred income tax assets and liabilities are based on enacted tax rates applicable to the future period when those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period the rate change is enacted. A valuation allowance is provided for deferred tax assets when it is more-likely-than-not the deferred tax assets will not be realized. The tax provision for interim periods is determined using an estimate of the Company’s annual effective tax rate, adjusted for discrete items, if any, that arise during the period. Each quarter, the Company updates its estimate of its annual effective tax rate, and if the estimated annual effective tax rate changes, the Company makes a cumulative adjustment in such period. The quarterly tax provision, and estimate of the Company’s annual effective tax rate, is subject to variation due to several factors, including variability in pre-tax income (or loss), revaluations of the warrant liability, and tax law developments. As a result of the Business Combination, WM Technology, Inc. became the sole managing member of WMH LLC, which is treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As a partnership, WMH LLC is not subject to U.S. federal and certain state and local income taxes. Accordingly, no provision for U.S. federal and state income taxes has been recorded in the financial statements for the period of January 1 to June 16, 2021 as this period was prior to the Business Combination. Any taxable income or loss generated by WMH LLC is passed through to and included in the taxable income or loss of its members, including WM Technology, Inc. following the Business Combination, on a pro rata basis. WM Technology, Inc. is subject to U.S. federal income taxes, in addition to state and local income taxes with respect to its allocable share of any taxable income of WMH LLC following the Business Combination. The Company is also subject to taxes in foreign jurisdictions. For the three and six months ended June 30, 2021, the Company recorded an income tax benefit of $0.4 million and $0.2 million, respectively. The tax benefit related to U.S. federal and state tax benefits from certain Business Combination-related expenses offset, in part, by income taxes recorded during the period ended March 31, 2021 as a result of an audit performed by the Canada Revenue Agency on prior years income taxes paid by the Company’s subsidiary, WM Canada Holdings, Inc. The effective tax rates differ from the federal statutory rate of 21% primarily due to flow-through income not subject to tax, permanent stock based compensation and warrant impacts, and state taxes. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. The Company does not believe it has any uncertain income tax positions that are more-likely-than-not to materially affect its condensed consolidated financial statements. Concentrations of Credit Risk The Company’s financial instruments are potentially subject to concentrations of credit risk. The Company places its cash with high quality credit institutions. From time to time, the Company maintains cash balances at certain institutions in excess of the Federal Deposit Insurance Corporation limit. Management believes that the risk of loss is not significant and has not experienced any losses in such accounts. Cost of Revenue The Company’s cost of revenue primarily consists of web hosting, internet service costs, and credit card processing costs. Product Development Costs Product development costs includes salaries and benefits for employees, including engineering and technical teams who are responsible for building new products, as well as improving existing products. Product development costs that do not meet the criteria for capitalization are expensed as incurred. Advertising The Company expenses the cost of advertising in the period incurred. Advertising expense totaled $4.8 million and $2.6 million for the three months ended June 30, 2021 and 2020, respectively, and $7.8 million and $4.3 million for the six months ended June 30, 2021 and 2020, respectively, and are included in sales and marketing expense in the accompanying condensed consolidated statements of income. Political Contributions The Company expenses the costs of all political contributions in the period incurred. Political contributions totaled $0.3 million and $0.1 million for the three months ended June 30, 2021 and 2020, respectively, $0.3 million for each of the six months ended June 30, 2021 and 2020, and are included in other expense in the accompanying condensed consolidated statements of income. Stock-Based Compensation The Company measures fair value of employee stock-based compensation awards on the date of grant using the Black-Scholes-Merton valuation model and allocates the related expense over the requisite service period. When awards include a performance condition that impacts the vesting for exercisability of the award, the Company records compensation cost when it becomes probable that the performance condition will be met and the service is provided. The expected volatility is based on the historical volatility and implied volatilities for comparable companies, the expected life of the award is based on the simplified method. The Company accounts for nonemployee stock-based transactions using the fair value of the consideration received (i.e., the value of the goods or services) or the fair value of the equity instruments issued, whichever is more reliably measurable. The Company has accounted for the issuance of Class A-3 and Class B Units in accordance with ASC 718 - Stock Based Compensation . The Company considers the limitation on the exercisability of the Class A-3 and Class B Units to be a performance condition and records compensation cost when it becomes probable that the performance condition will be met. In connection with the Business Combination, each of the Class A-3 Units outstanding prior to the Business Combination were cancelled, and the holder thereof received a number of Class A units representing limited liability company interests of WMH LLC (the “Class A Units”) and an equivalent number of shares of Class V Common Stock, par value $0.0001 per share (together with the Class A Units, the “Paired Interests”), and each of the Class B Units outstanding prior to the Business Combination were cancelled and holders thereof received a number of Class P units representing limited liability company interests of WMH LLC (the “Class P Units” and together with the Class A Units, the “Units”), each in accordance with the Merger Agreement. Concurrently with the closing of the Business Combination, the Unit holders entered into an exchange agreement (the “Exchange Agreement”). The terms of the Exchange Agreement, among other things, provide the Unit holders (or certain permitted transferees thereof) with the right from time to time at and after 180 days following the Business Combination to exchange their vested Paired Interests for shares of Class A Common Stock on a one-for-one basis, subject to customary conversion rate adjustments for stock splits, stock dividends and reclassifications, or Class P Units for shares of Class A Common Stock with a value equal to the value of such Class P Units less their participation threshold, or in each case, at the Company’s election, the cash equivalent of such shares of Class A Common Stock. As of June 30, 2021, total remaining stock-based compensation expense for non-vested Class P Units was $5.7 million, which is expected to be recognized over a weighted-average period of 2.4 years. For the three and six months ended June 30, 2021, the Company recorded stock-based compensation expense of $19.4 million, which represents the life-to-date expense on the Company’s equity awards through June 30, 2021. Due to the Business Combination completed in the second quarter of 2021, certain limitations on exercisability related to the Company’s equity awards issued to employees and consultants were removed. As a result, the Company recognized share-based compensation expense through June 30, 2021 on those equity awards. The stock-based compensation expense recognized during the period also includes a one-time incremental expense of $4.1 million related to an award modification as a result of an advisory agreement entered into with a former executive. The Company recorded stock-based compensation in the following expense categories on the accompanying condensed consolidated statements of income (in thousands): Three and Six Months Ended June 30, 2021 Sales and marketing $ 3,826 Product development 1,994 General and administrative 13,613 Total stock-based compensation $ 19,433 Segment Reporting The Company and its subsidiaries operate in one business segment. Earnings Per Share Basic net earnings per share is computed by dividing net earnings attributable to WM Technology, Inc. for the period from June 16, 2021 (Closing Date) to June 30, 2021 by the weighted-average number of shares of Class A Common Stock outstanding during the same period. Diluted net earnings per share is computed giving effect to all potential weighted-average dilutive shares for the period. The dilutive effect of outstanding awards or financial instruments, if any, is reflected in diluted earnings per share by application of the treasury stock method or if-converted method, as applicable. Prior to the Business Combination, the membership structure of Legacy WMH included units which had profit interests. The Company analyzed the calculation of earnings per unit for periods prior to the Business Combination and determined that it resulted in values that would not be meaningful to the users of these condensed consolidated financial statements. As a result, earnings per share information has not been presented for periods prior to the Business Combination on June 16, 2021. The basic and diluted earnings (loss) per share for the three and six months ended June 30, 2021 represent only the period from June 16, 2021 to June 30, 2021. Warrant Liability The Company assumed 12,499,933 Public Warrants and 7,000,000 Private Placement Warrants (together, the “Warrants”) upon the Closing, all of which were issued in connection with Silver Spike’s initial public offering and entitle the holder to purchase one share of Class A Common Stock at an exercise price of at $11.50 per share. All of the Warrants remained outstanding as of June 30, 2021. The Public Warrants are publicly traded and are exercisable for cash unless certain conditions occur, such as the failure to have an effective registration statement related to the shares issuable upon exercise or redemption by the Company under certain conditions, at which time the warrants may be cashless exercised. The Private Placement Warrants are transferable, assignable or salable in certain limited exceptions. The Private Placement Warrants are exercisable for cash or on a cashless basis, at the holder’s option, and are non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will cease to be Private Placement Warrants, and become Public Warrants and be redeemable by the Company and exercisable by such holders on the same basis as the other Public Warrants. The Company evaluated the Warrants under ASC 815-40 - Derivatives and Hedging -Contracts in Entity’s Own Equity , and concluded they do not meet the criteria to be classified in stockholders’ equity. Specifically, the exercise of the Warrants may be settled in cash upon the occurrence of a tender offer or exchange that involves 50% or more of our Class A equity holders. Because not all of the voting stockholders need to participate in such tender offer or exchange to trigger the potential cash settlement and the Company does not control the occurrence of such an event, the Company concluded that the Warrants do not meet the conditions to be classified in equity. Since the Warrants meet the definition of a derivative under ASC 815, the Company recorded these warrants as liabilities on the condensed consolidated balance sheets at fair value, with subsequent changes in their respective fair values recognized in change in fair value of warrant liabilities within the condensed consolidated statements of income at each reporting date. Fair Value Measurements The Company follows the guidance in ASC 820 - Fair Value Measurements for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: • Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. • Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. • Level 3: Unobservable inputs based on the Company assessment of the assumptions that market participants would use in pricing the asset or liability. Tax Receivable Agreement The Business Combination was accomplished through what is commonly referred to as an “Up-C” structure, which is often used by partnerships and limited liability companies undertaking an initial public offering. The Up-C structure allows the Legacy WMH Unit holders to retain their equity ownership in WMH LLC, an entity that is classified as a partnership for U.S. federal income tax purposes, in the form of Units and provides potential future tax benefits for both the Company and the WMH LLC Unit holders when they ultimately exchange their pass-through interests for shares of Class A Common Stock. Additionally, the Company could obtain future increases in its tax basis of the assets of WMH LLC when such units are redeemed or exchanged by the continuing members. This increase in tax basis may have the effect of reducing the amounts paid in the future to various tax authorities. The increase in tax basis may also decrease gains (or increase losses) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets. In connection with the Business Combination, the Company entered into a tax receivable agreement (the “Tax Receivable Agreement”) with continuing members that provides for a payment to the continuing Class A Unit holders of 85% of the amount of tax benefits, if any, that the Company realizes, or is deemed to realize, as a result of redemptions or exchanges of Units. In connection with such potential future tax benefits resulting from the Business Combination, the Company has established a deferred tax asset for the additional tax basis and a corresponding TRA liability of 85% of the expected benefit. The remaining 15% is recorded to additional paid-in capital. Leases Effective January 1, 2021, the Company accounts for its leases under ASC 842, Leases . Under this guidance, lessees classify arrangements meeting the definition of a lease as operating or financing leases, and leases are recorded on the consolidated balance sheet as both a right-of-use asset and lease liability, calculated by discounting fixed lease payments over the lease term at the rate implicit in the lease or the Company’s incremental borrowing rate. Lease liabilities are increased by interest and reduced by payments each period, and the right-of-use asset is amortized over the lease term. For operating leases, interest on the lease liability and the amortization of the right-of-use asset result in straight-line rent expense over the lease term. For finance leases, interest on the lease liability and the amortization of the right-of-use asset results in front-loaded expense over the lease term. Variable lease expenses are recorded when incurred. In calculating the right-of-use asset and lease liability, the Company elects to combine lease and non-lease components for all classes of assets. The Company excludes short-term leases having initial terms of 12 months or less from the new guidance as an accounting policy election, and instead recognizes rent expense on a straight-line basis over the lease term. The Company continues to account for leases in the prior period financial statements under ASC 840, Leases . Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842). The guidance in this ASU supersedes the leasing guidance in Topic 840, Leases. Under the new guidance, lessees are required to recognize lease assets and lease liabilities on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the consolidated statements of operations. The Company adopted ASC 842 as of January 1, 2021, using the modified retrospective transition approach by recording a right-of-use (“ROU”) asset and lease liability for operating leases of $43.3 million and $48.4 million, respectively, at that date; the Company did not have any finance lease assets and liabilities upon adoption or any arrangements where it acts as a lessor. Adoption of ASC 842 did not have an effect on the Company’s retained earnings. The Company availed itself of the practical expedients provided under ASC 842 regarding identification of leases, lease classification, indirect costs, and the combination of lease and non-lease components for all classes of assets. The Company continues to account for leases in the prior period financial statements under ASC 840. |
Leases
Leases | 6 Months Ended |
Jun. 30, 2021 | |
Leases [Abstract] | |
Leases | Leases On January 1, 2021, the Company adopted ASC 842 - Leases using the modified retrospective transition approach for recording ROU assets and operating lease liabilities for its operating leases. The Company’s operating leases consist of office space located primarily in the United States. The Company does not have any leases classified as financing leases. The components of lease related expense for the three and six months ended June 30, 2021 are as follows (in thousands): Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Operating lease cost $ 2,377 $ 4,768 Variable lease cost 639 1,150 Operating lease expense 3,016 5,918 Short-term lease rent expense 67 87 Net rent expense $ 3,083 $ 6,005 For the three and six months ended June 30, 2021, the Company made cash payments of $2.4 million and $3.5 million, respectively, on its operating leases, all of which were included in cash flows from operating activities within the condensed consolidated statements of cash flows. During the six months ended June 30, 2021, ROU assets obtained in exchange for operating lease liabilities were $43.3 million. As of June 30, 2021, future minimum payments for the next five years and thereafter are as follows (in thousands): Operating Leases Remaining period in 2021 (six months) $ 4,674 Year ended December 31, 2022 9,597 Year ended December 31, 2023 9,898 Year ended December 31, 2024 9,405 Year ended December 31, 2025 5,830 Thereafter 29,732 Future minimum lease payments $ 69,136 Less: present value discount (21,878) Operating lease liabilities $ 47,258 As of June 30, 2021, the Company’s operating leases had a weighted average remaining lease term of 7.8 years and a weighted-average discount rate of 9.8%. The Company’s lease agreements do not provide an implicit rate, so the Company used an estimated incremental borrowing rate, which was derived from third-party information available at the time the Company adopted ASC 842 in determining the present value of future lease payments. The rate used is for a secured borrowing of a similar term as the right of use asset. During the three and six ended June 30, 2021, the Company recognized an impairment charge of $2.4 million related to an ROU asset reducing the carrying value of the lease asset to its estimated fair value. The fair value was estimated using an income approach based on management’s forecast of future cash flows expected to be derived based on current sublease market rent. The impairment charge is included in general and administrative expenses in the condensed consolidated statements of income. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Litigation During the ordinary course of the Company’s business, it is subject to various claims and litigation. Management believes that the outcome of such claims or litigation will not have a material adverse effect on the Company’s financial position, results of operations or cash flow. In September 2019, the Company received a grand jury subpoena prepared by the United States Attorney’s Office for the Eastern District of California (“DOJ”). The subpoena demanded certain categories of information from the Company, some of which the Company has already provided. Management believes that the outcome of such inquiry will not have a material adverse impact of the Company’s financial position, results of operations, or cash flow. On August 4, 2021, the DOJ notified the Company that the DOJ was withdrawing the subpoena issued in September 2019, and that it had no present plan to exercise its discretion to proceed further in the matter. The DOJ cautioned that its decision not to proceed further did not constitute a grant of immunity, and that its plans could change in the future without notice. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following table presents information about the Company’s liabilities that are measured at fair value on a recurring basis at June 30, 2021 and December 31, 2020, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value (in thousands): Level June 30, 2021 December 31, 2020 Liabilities: Warrant liability – Public Warrants 1 $ 79,375 $ — Warrant liability – Private Placement Warrants 3 76,812 — Total warrant liability $ 156,187 $ — The following tables summarize the changes in the fair value of the warrant liabilities (in thousands): Three months ended June 30, 2021 Public Warrants Private Placement Warrants Warrant Liabilities Fair value, beginning of period $ — $ — $ — Warrant liability acquired 100,750 93,228 193,978 Change in valuation inputs or other assumptions (21,375) (16,416) (37,791) Fair value, end of period $ 79,375 $ 76,812 $ 156,187 Public Warrants The Company determined the fair value of its public warrants, which were originally issued in the initial public offering of Silver Spike (the “Public Warrants”) based on the publicly listed trading price of such warrants as of the valuation date. Accordingly, the Public Warrants are classified as Level 1 financial instruments. The fair value of the Public Warrants was $100.8 million and $79.4 million as of June 16, 2021 and June 30, 2021, respectively. Private Placement Warrants The estimated fair value of the warrants that were originally issued in a private placement (the “Private Placement Warrants” and together with the Public Warrants, the “Warrants”) is determined with Level 3 inputs using the Black-Scholes model. The Private Placement Warrants were valued as of June 16, 2021 (Closing Date) and June 30, 2021. The significant inputs and assumptions in this method are the stock price, exercise price, volatility, risk-free rate, and term or maturity. The underlying stock price input is the closing stock price as of each valuation date and the exercise price is the price as stated in the warrant agreement. The volatility input was determined using the historical volatility of comparable publicly traded companies which operate in a similar industry or compete directly against the Company. Volatility for each comparable publicly traded company is calculated as the annualized standard deviation of daily continuously compounded returns. The Black-Scholes analysis is performed in a risk-neutral framework, which requires a risk-free rate assumption based upon constant-maturity treasury yields, which are interpolated based on the remaining term of the Private Placement Warrants as of each valuation date. The term/maturity is the duration between each valuation date and the maturity date, which is five years following the date the Business Combination closed, or June 16, 2026. The following table provides quantitative information regarding Level 3 fair value measurements inputs at their measurement dates: June 16, 2021 June 30, 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 20.55 $ 17.86 Volatility 60.0 % 60.0 % Term (years) 5.00 4.96 Risk-free interest rate 0.89 % 0.86 % Significant changes in the volatility would result in a significant lower or higher fair value measurement, respectively. The fair value of the Private Placement Warrants was $93.2 million and $76.8 million as of June 16, 2020 and June 30, 2021, respectively. The Warrants were accounted for as liabilities in accordance with ASC 815- Derivatives and Hedging and are presented within warrant liability on the accompanying condensed consolidated balance sheets. The warrant liabilities are measured at fair value at inception and on a recurring basis, with changes in fair value presented within change in fair value of warrant liability in the condensed consolidated statements of income. There were no transfers in or out of Level 3 from other levels in the fair value hierarchy. |
Business Combination
Business Combination | 6 Months Ended |
Jun. 30, 2021 | |
Reverse Recapitalization [Abstract] | |
Business Combination | Business Combination As further discussed in Note 1, on June 16, 2021, the Company consummated the Business Combination pursuant to the Merger Agreement. In connection with the Closing, the following occurred: • Silver Spike was domesticated and continues as a Delaware corporation, changing its name to “WM Technology, Inc.” • The Company was reorganized into an Up-C structure, in which substantially all of the assets and business of the Company are held by WMH LLC and continue to operate through WMH LLC and its subsidiaries, and WM Technology, Inc.’s material assets are the equity interests of WMH LLC indirectly held by it. • The Company consummated the sale of 32,500,000 shares of Class A Common Stock for a purchase price of $10.00 per share (together, the “PIPE Financing”) pursuant to certain subscription agreements dated as of December 10, 2020, for an aggregate price of $325.0 million. • The Company contributed approximat ely $80.3 million of cash to WMH LLC, representing (a) the net amount held in the Company’s trust account following the redemption of 10,012 shares of Class A Common Stock originally sold in the Silver Spike’s initial public offering, less (b) cash consideration of $455.2 million paid to Legacy WMH Class A equity holders, plus (c) $325.0 million in aggregate proceeds from the PIPE Financing, less (d) the aggregate amount of transaction expenses incurred by the parties to the Business Combination Agreement. • The Company transferred $455.2 million to the Legacy WMH equity holders as cash consideration. • The Legacy WMH equity holders retained an aggregate of 65,502,347 Class A Units and 25,896,042 Class P Units. • The Company issued 65,502,347 shares of Class V Common Stock to Class A Unit holders, representing the same number of Class A Units retained by the Legacy WMH equity holders. • The Company, the Holder Representative and the Class A Unit holders entered into the Tax Receivable Agreement, pursuant to which WM Technology, Inc. will pay to WMH LLC Class A equity holders 85% of the net income tax savings that WM Technology, Inc. actually realizes as a result of increases in the tax basis of WMH LLC’s assets as a result of the exchange of Units for cash in the Business Combination and future exchanges of the Class A Units for shares of Class A Common Stock or cash pursuant to the Exchange Agreement, and certain other tax attributes of WMH LLC and tax benefits related to the Tax Receivable Agreement, including tax benefits attributable to payments under the Tax Receivable Agreement. Concurrently with the closing of the Business Combination, the Unit holders entered into the Exchange Agreement. The terms of the Exchange Agreement, among other things, provide the Unit holders (or certain permitted transferees thereof) with the right from time to time at and after 180 days following the Business Combination to exchange their vested Paired Interests for shares of Class A Common Stock on a one-for-one basis, subject to customary conversion rate adjustments for stock splits, stock dividends and reclassifications, or Class P Units for shares of Class A Common Stock with a value equal to the value of such Class P Units less their participation threshold, or in each case, at the Company’s election, the cash equivalent of such shares of Class A Common Stock. The following table reconciles the elements of the Business Combination to the condensed consolidated statements of cash flows and the condensed consolidated statements of changes in stockholders’ (deficit) equity for the six months ended June 30, 2021 (in thousands): Business Combination Cash - Silver Spike trust and cash, net of redemptions $ 254,203 Cash - PIPE Financing 325,000 Less: cash consideration paid to Legacy WMH equity holders (455,182) Less: transaction costs and advisory fees (43,737) Net proceeds from the Business Combination 80,284 Less: initial fair value of warrant liability recognized in the Business Combination (193,978) Add: transaction costs allocated to Warrants 5,506 Add: non-cash assets assumed from Silver Spike 1,053 Add: deferred tax asset 147,973 Less: tax receivable agreement liability (126,150) Net adjustment to total equity from the Business Combination $ (85,312) The number of shares of common stock issued immediately following the Closing: Number of Shares Common stock, outstanding prior to the Business Combination 24,998,575 Less: redemption of shares of Silver Spike’s Class A common stock 10,012 Shares of Silver Spike’s Class A common stock 24,988,563 Shares of Class A Common Stock held by Silver Spike’s Sponsor 6,250,000 Shares of Class A Common Stock issued in the PIPE Financing 32,500,000 Shares of Class A Common Stock issued in the Business Combination 63,738,563 Shares of Class V Common Stock issued to Legacy WMH equity holders 65,502,347 Total shares of common stock issued in the Business Combination 129,240,910 Net income for the period from June 16, 2021 (Closing Date) to June 30, 2021 was $9.5 million, which includes change in fair value of warrant liability of $37.8 million, share-based compensation expense of $19.4 million and transaction costs related to the warrant liability of $5.5 million. The transaction costs related to the warrant liability is included in other expense, net on the accompanying condensed consolidated statements of income. |
Warrant Liability
Warrant Liability | 6 Months Ended |
Jun. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Warrant Liability | Warrant Liability At June 30, 2021, there were 12,499,933 Public Warrants outstanding and 7,000,000 Private Placement Warrants outstanding. As part of Silver Spike’s initial public offering, 12,500,000 Public Warrants were sold. The Public Warrants entitle the holder thereof to purchase one share of Class A Common Stock at a price of $11.50 per share, subject to adjustments. The Public Warrants may be exercised only for a whole number of shares of Class A Common Stock. No fractional shares will be issued upon exercise of the warrants. The Public Warrants will expire at 5:00 p.m. New York City time on June 16, 2026, or earlier upon redemption or liquidation. The Public Warrants are listed on the NYSE under the symbol “MAPSW.” The Company may redeem the Public Warrants starting July 16, 2021, in whole and not in part, at a price of $0.01 per Public Warrant, upon not less than 30 days’ prior written notice of redemption to each holder of Public Warrants, and if, and only if, the reported last sales price of the Company’s Class A Common Stock equals or exceeds $18.00 per share (as adjusted for share splits, share dividends, rights issuances, subdivisions, reorganizations, recapitalization and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date the Company sends the notice of redemption to the holders of Public Warrants. Simultaneously with Silver Spike’s initial public offering, Silver Spike consummated a private placement of 7,000,000 Private Placement Warrants with Silver Spike’s sponsor (“Silver Spike Sponsor”). Each Private Placement Warrant is exercisable for one share of Class A Common Stock at a price of $11.50 per share, subject to adjustment. The Private Placement Warrants (including the shares of Class A Common Stock issuable upon exercise of the Private Placement Warrants) are not transferable, assignable or salable until 30 days after the completion of the Business Combination, subject to certain exceptions, and they are nonredeemable as long as they are held by Silver Spike Sponsor or its permitted transferees. Silver Spike Sponsor, as well as its permitted transferees, has the option to exercise the Private Placement Warrants on a cashless basis and will have certain registration rights related to such Private Placement Warrants. Otherwise, the Private Placement Warrants have terms and provisions that are identical to those of the Public Warrants. If the Private Placement Warrants are held by holders other than Silver Spike Sponsor or its permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by the holders on the same basis as the Public Warrants. The Company may exercise its redemption right even if it is unable to register or qualify the underlying securities for sale under all applicable state securities laws. If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of Class A Common Stock issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, the Public Warrants will not be adjusted for issuances of shares of Class A Common Stock at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the Public Warrants. The Private Placement Warrants are identical to the Public Warrants underlying the units sold in the initial public offering, except that the Private Placement Warrants and the Class A Common Stock issuable upon the exercise of the Private Placement Warrants were not transferable, assignable or salable until 30 days after the completion of the Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. The Company concluded the Public Warrants and Private Placement Warrants, or the Warrants, meet the definition of a derivative under ASC 815- Derivatives and Hedging (as described in Note 2) and are recorded as liabilities. Upon the Closing, the fair value of the Warrants was recorded on the balance sheet. The fair value of the Warrants was remeasured as of June 30, 2021, resulting in a $37.8 million non-cash change in fair value of the Warrant liabilities in the condensed consolidated statements of income during the three and six months ended June 30, 2021. |
Equity
Equity | 6 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Equity | Equity Class A Common Stock Voting Rights Each holder of the shares of Class A Common Stock is entitled to one vote for each share of Class A Common Stock held of record by such holder on all matters on which stockholders generally are entitled to vote. The holders of the shares of Class A Common Stock do not have cumulative voting rights in the election of directors. Generally, all matters to be voted on by stockholders must be approved by a majority (or, in the case of election of directors, by a plurality) of the votes entitled to be cast by all stockholders present in person or represented by proxy, voting together as a single class. Notwithstanding the foregoing, the holders of the outstanding shares of Class A Common Stock are entitled to vote separately upon any amendment to the Company’s certificate of incorporation (including by merger, consolidation, reorganization or similar event) that would alter or change the powers, preferences or special rights of such class of common stock in a manner that is disproportionately adverse as compared to the Class V Common Stock. Dividend Rights Subject to preferences that may be applicable to any outstanding preferred stock, the holders of shares of Class A Common Stock are entitled to receive ratably such dividends, if any, as may be declared from time to time by the Company’s board of directors out of funds legally available therefor. Rights upon Liquidation, Dissolution and Winding-Up In the event of any voluntary or involuntary liquidation, dissolution or winding up of our affairs, the holders of the shares of Class A Common Stock are entitled to share ratably in all assets remaining after payment of the Company’s debts and other liabilities, subject to prior distribution rights of preferred stock or any class or series of stock having a preference over the shares of Class A Common Stock, then outstanding, if any. Preemptive or Other Rights The holders of shares of Class A Common Stock have no preemptive or conversion rights or other subscription rights. There are no redemption or sinking fund provisions applicable to the shares of Class A Common Stock. The rights, preferences and privileges of holders of shares of Class A Common Stock will be subject to those of the holders of any shares of the preferred stock that the Company may issue in the future. Class V Common Stock Voting Rights Each holder of the shares of Class V Common Stock is entitled to one vote for each share of Class V Common Stock held of record by such holder on all matters on which stockholders generally are entitled to vote. The holders of shares of Class V Common Stock do not have cumulative voting rights in the election of directors. Generally, all matters to be voted on by stockholders must be approved by a majority (or, in the case of election of directors, by a plurality) of the votes entitled to be cast by all stockholders present in person or represented by proxy, voting together as a single class. Notwithstanding the foregoing, the holders of the outstanding shares of Class V Common Stock are entitled to vote separately upon any amendment to the Company’s certificate of incorporation (including by merger, consolidation, reorganization or similar event) that would alter or change the powers, preferences or special rights of such class of common stock in a manner that is disproportionately adverse as compared to the Class A Common Stock. Dividend Rights The holders of the Class V Common Stock will not participate in any dividends declared by the Company’s board of directors. Rights upon Liquidation, Dissolution and Winding-Up In the event of any voluntary or involuntary liquidation, dissolution or winding up of our affairs, the holders of Class V Common Stock are not entitled to receive any of the Company’s assets. Preemptive or Other Rights The holders of shares of Class V Common Stock do not have preemptive, subscription, redemption or conversion rights. There will be no redemption or sinking fund provisions applicable to the Class V Common Stock. Issuance and Retirement of Class V Common Stock In the event that any outstanding share of Class V Common Stock ceases to be held directly or indirectly by a holder of Class A Units, such share will automatically be transferred to us for no consideration and thereupon will be retired. The Company will not issue additional shares of Class V Common Stock other than in connection with the valid issuance or transfer of Units in accordance with the governing documents of WMH LLC. Preferred Stock Pursuant to the amended and restated certificate of incorporation in effect as of June 15, 2021, the Company was authorized to issue 75,000,000 shares of preferred stock with such designations, voting and other rights and preferences as may be determined from time to time by the Company’s board of directors. As of June 30, 2021, there were no shares of preferred stock issued or outstanding. Noncontrolling Interests The noncontrolling interest represents the Units held by holders other than the Company. As of June 30, 2021, the noncontrolling interests owned 57.5% of the Units outstanding. The noncontrolling interests’ ownership percentage can fluctuate over time, including as the WMH LLC equity holders elect to exchange Units for Class A Common Stock. The Company has consolidated the financial position and results of operations of WMH LLC and reflected the proportionate interest held by the WMH LLC Unit equity holders as noncontrolling interests. Net income for the period prior to the Business Combination from January 1, 2021 to June 15, 2021 is allocated to net income attributable to noncontrolling interests on the accompanying condensed consolidated statements of income. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic net earnings per share of Class A Common Stock is computed by dividing net earnings attributable to the Company by the weighted-average number of shares of Class A Common Stock outstanding during the period from June 16, 2021 (Closing Date) to June 30, 2021. Diluted net earnings per share of Class A Common Stock is computed by dividing net income attributable to the Company, adjusted for the assumed exchange of all potentially dilutive securities, by the weighted-average number of shares of Class A Common Stock outstanding adjusted to give effect to potentially dilutive shares. Prior to the Business Combination, the membership structure of WMH included units which had profit interests. The Company analyzed the calculation of net earnings (loss) per unit for periods prior to the Business Combination and determined that it resulted in values that would not be meaningful to the users of these condensed consolidated financial statements. Therefore, net earnings per share information has not been presented for periods prior to the Business Combination on June 16, 2021. The basic and diluted earnings (loss) per share for the three and six months ended June 30, 2021 represent only the period from June 16, 2021 to June 30, 2021. The computation of net earnings per share attributable to WM Technology, Inc. and weighted-average shares of the Company’s Class A Common Stock outstanding for period from June 16, 2021 (Closing Date) to June 30, 2021 are as follows (amounts in thousands, except for share and per share amounts): Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Numerator: Net income $ 16,837 $ 24,568 Less: net income attributable to WMH LLC prior to the Business Combination 7,347 15,078 Less: net income attributable to noncontrolling interests after the Business Combination 5,227 5,227 Net income attributable to WM Technology, Inc. - basic 4,263 4,263 Effect of dilutive securities: Less: fair value change of Public and Private Placement Warrants, net of amounts attributable to noncontrolling interests 16,061 16,061 Net loss attributable to WM Technology, Inc. - diluted $ (11,798) $ (11,798) Denominator: Weighted average common shares outstanding - basic 63,738,563 63,738,563 Weighted average effect of dilutive securities: Public Warrants¹ 4,877,681 4,877,681 Private Placement Warrants¹ 2,731,502 2,731,502 Weighted average common shares outstanding - diluted 71,347,746 71,347,746 Net income (loss) per share of Class A Common Stock: Net income per share of Class A Common Stock - basic $ 0.07 $ 0.07 Net loss per share of Class A Common Stock - diluted $ (0.17) $ (0.17) ____________________________________ ¹Calculated using the treasury stock method. Shares of the Class V Common Stock do not participate in the earnings or losses of the Company and are therefore not participating securities. As such, separate presentation of basic and diluted earnings per share of Class V Common Stock under the two-class method has not been presented. The Company excluded the following securities from its computation of diluted shares outstanding, as their effect would have been anti-dilutive: June 30, 2021 Class A Units 65,502,347 Class P Units 25,679,121 Total Units 91,181,468 |
Summary of significant accoun_2
Summary of significant accounting policies (Policies) | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP and applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for quarterly reports on Form 10-Q and Article 10-1 of Regulation S-X. Accordingly, certain information and footnotes required by GAAP in annual financial statements have been omitted or condensed and these interim financial statements should be read in conjunction with the Company’s audited financial statements and accompanying notes included in the Company’s Registration Statement on Form S-1 filed with the SEC on July 8, 2021. The condensed financial statements of the Company include all adjustments of a normal recurring nature which, in the opinion of management, are necessary for a fair statement of the Company’s financial position as of June 30, 2021, and results of its operations and its cash flows for the interim periods presented. The results of operations for the six months ended June 30, 2021 are not necessarily indicative of the results to be expected for the entire year. There have been no significant changes in the Company’s accounting policies from those described in the Company’s audited consolidated financial statements and the related notes to those statements, other than the adoption of the lease accounting guidance. Pursuant to the Merger Agreement, the Business Combination was accounted for as a reverse recapitalization in accordance with GAAP (the “Reverse Recapitalization”). Under this method of accounting, Silver Spike was treated as the acquired company and Legacy WMH was treated as the acquirer for financial statement reporting purposes. Accordingly, for accounting purposes, the Reverse Recapitalization was treated as the equivalent of Legacy WMH issuing stock for the net assets of Silver Spike, accompanied by a recapitalization. Legacy WMH was determined to be the accounting acquirer based on evaluation of the following facts and circumstances: • Legacy WMH Class A Unit holders, through their ownership of the Class V Common Stock, have the greatest voting interest in the Company with over 50% of the voting interest; • Legacy WMH selected the majority of the new board of directors of the Company; • Legacy WMH senior management is the senior management of the Company; and • Legacy WMH is the larger entity based on historical operating activity and has the larger employee base. Thus, the financial statements included in this quarterly report reflect (i) the historical operating results of Legacy WMH prior to the Business Combination; (ii) the combined results of the WMH LLC and Silver Spike following the Business Combination; and (iii) the acquired assets and liabilities of Silver Spike stated at historical cost, with no goodwill or other intangible assets recorded. |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include the accounts of WM Technology, Inc. and WM Holding Company, LLC and its subsidiaries, GMG Holdco, Inc., Weedmaps Media, LLC (“Weedmaps”), Ghost Management Group, LLC, WM Canada Holdings, Inc., WM Enterprise, LLC, WM Marketplace, LLC, Weedmaps Spain, S.LU., WM Retail, LLC, Grow One Software (Canada), Inc., Discovery Opco, LLC, WM Museum, LLC, WM Teal, LLC and Weedmaps Germany GmbH. All significant intercompany balance and transactions have been eliminated upon consolidation. |
Foreign Currency | Foreign Currency Assets and liabilities denominated in a foreign currency are translated into U.S. dollars using the exchange rates in effect at the balance sheet date. Revenue and expense accounts are translated at the average exchange rates during the periods. The impact of exchange rate fluctuations from translation of assets and liabilities is insignificant for the three and six months ended June 30, 2020 and 2021. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates made by management include, among others, the valuation of accounts receivable, the useful lives of long-lived assets, income taxes, website and internal-use software development costs, leases, valuation of goodwill and other intangible assets, valuation of warrant liability, deferred tax asset and tax receivable agreement liability, revenue recognition, stock-based compensation, and the recognition and disclosure of contingent liabilities. |
Accounts Receivable | Accounts Receivable Accounts receivable is recorded at the invoiced amount and does not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in existing accounts receivable. The allowance for doubtful accounts is reviewed on a monthly basis and we reserve for all balance in outstanding in excess of ninety days. Account balances are written off against the allowance when it is determined that it is probable that the receivable will not be recovered. The Company recorded an allowance for bad debt of $0.7 million as of June 30, 2021. |
Revenue Recognition | Revenue Recognition The Company’s revenues are derived primarily from monthly subscriptions and additional offerings for access to the Company’s Weedmaps platform and the Company’s SaaS solutions. The Company recognizes revenue when the fundamental criteria for revenue recognition are met. The Company recognizes revenue by applying the following steps: the contract with the customer is identified; the performance obligations in the contract are identified; the transaction price is determined; the transaction price is allocated to the performance obligations in the contract; and revenue is recognized when (or as) the Company satisfies these performance obligations in an amount that reflects the consideration it expects to be entitled to in exchange for those services. Substantially all of the Company’s revenue is generated by providing standard listing and software subscription services and other paid listing subscriptions services, including featured listings, promoted deals, nearby listings and other display advertising to its customers. These arrangements are recognized over-time, generally during a month-to-month subscription period as the products are provided. The Company may also provide services to its customers, including access to the Company’s orders functionality, which are recognized at a point in time, typically when an order for delivery or pickup is submitted. The Company rarely needs to allocate the transaction price to separate performance obligations. In the rare case that allocation of the transaction price is needed, the Company recognizes revenue in proportion to the standalone selling prices of the underlying services at contract inception. Starting on January 1, 2021, the Company eliminated the technology services fee charge related to the Company’s orders functionality. Deferred revenue primarily consists of billings or payments received in advance of revenue recognition from subscription offerings, as described above, and is recognized as the revenue recognition criteria are met. The prior year deferred revenue balance of $5.3 million was fully recognized in the first quarter of fiscal year 2021, and the deferred revenue balance as of June 30, 2021 of $6.9 million is expected to be fully recognized within the next twelve months. The Company generally invoices customers and receives payment on an upfront basis and payments do not include significant financing components or variable consideration and there are generally no rights of return or refunds after the subscription period has passed. |
Income Taxes | Income Taxes The Company uses the asset and liability method of accounting for income taxes under ASC 740 - Income Taxes. Under the guidance, deferred tax assets and liabilities are recognized for the future tax consequences of (i) temporary differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities and (ii) operating loss and tax credit carryforwards. Deferred income tax assets and liabilities are based on enacted tax rates applicable to the future period when those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period the rate change is enacted. A valuation allowance is provided for deferred tax assets when it is more-likely-than-not the deferred tax assets will not be realized. The tax provision for interim periods is determined using an estimate of the Company’s annual effective tax rate, adjusted for discrete items, if any, that arise during the period. Each quarter, the Company updates its estimate of its annual effective tax rate, and if the estimated annual effective tax rate changes, the Company makes a cumulative adjustment in such period. The quarterly tax provision, and estimate of the Company’s annual effective tax rate, is subject to variation due to several factors, including variability in pre-tax income (or loss), revaluations of the warrant liability, and tax law developments. As a result of the Business Combination, WM Technology, Inc. became the sole managing member of WMH LLC, which is treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As a partnership, WMH LLC is not subject to U.S. federal and certain state and local income taxes. Accordingly, no provision for U.S. federal and state income taxes has been recorded in the financial statements for the period of January 1 to June 16, 2021 as this period was prior to the Business Combination. Any taxable income or loss generated by WMH LLC is passed through to and included in the taxable income or loss of its members, including WM Technology, Inc. following the Business Combination, on a pro rata basis. WM Technology, Inc. is subject to U.S. federal income taxes, in addition to state and local income taxes with respect to its allocable share of any taxable income of WMH LLC following the Business Combination. The Company is also subject to taxes in foreign jurisdictions. For the three and six months ended June 30, 2021, the Company recorded an income tax benefit of $0.4 million and $0.2 million, respectively. The tax benefit related to U.S. federal and state tax benefits from certain Business Combination-related expenses offset, in part, by income taxes recorded during the period ended March 31, 2021 as a result of an audit performed by the Canada Revenue Agency on prior years income taxes paid by the Company’s subsidiary, WM Canada Holdings, Inc. The effective tax rates differ from the federal statutory rate of 21% primarily due to flow-through income not subject to tax, permanent stock based compensation and warrant impacts, and state taxes. ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. The Company does not believe it has any uncertain income tax positions that are more-likely-than-not to materially affect its condensed consolidated financial statements. |
Concentrations of Credit Risk | Concentrations of Credit Risk The Company’s financial instruments are potentially subject to concentrations of credit risk. The Company places its cash with high quality credit institutions. From time to time, the Company maintains cash balances at certain institutions in excess of the Federal Deposit Insurance Corporation limit. Management believes that the risk of loss is not significant and has not experienced any losses in such accounts. |
Cost of Revenue | Cost of Revenue The Company’s cost of revenue primarily consists of web hosting, internet service costs, and credit card processing costs. |
Product Development Costs | Product Development Costs Product development costs includes salaries and benefits for employees, including engineering and technical teams who are responsible for building new products, as well as improving existing products. Product development costs that do not meet the criteria for capitalization are expensed as incurred. |
Advertising | Advertising The Company expenses the cost of advertising in the period incurred. Advertising expense totaled $4.8 million and $2.6 million for the three months ended June 30, 2021 and 2020, respectively, and $7.8 million and $4.3 million for the six months ended June 30, 2021 and 2020, respectively, and are included in sales and marketing expense in the accompanying condensed consolidated statements of income. |
Political Contributions | Political Contributions The Company expenses the costs of all political contributions in the period incurred. Political contributions totaled $0.3 million and $0.1 million for the three months ended June 30, 2021 and 2020, respectively, $0.3 million for each of the six months ended June 30, 2021 and 2020, and are included in other expense in the accompanying condensed consolidated statements of income. |
Stock-Based Compensation | Stock-Based Compensation The Company measures fair value of employee stock-based compensation awards on the date of grant using the Black-Scholes-Merton valuation model and allocates the related expense over the requisite service period. When awards include a performance condition that impacts the vesting for exercisability of the award, the Company records compensation cost when it becomes probable that the performance condition will be met and the service is provided. The expected volatility is based on the historical volatility and implied volatilities for comparable companies, the expected life of the award is based on the simplified method. The Company accounts for nonemployee stock-based transactions using the fair value of the consideration received (i.e., the value of the goods or services) or the fair value of the equity instruments issued, whichever is more reliably measurable. The Company has accounted for the issuance of Class A-3 and Class B Units in accordance with ASC 718 - Stock Based Compensation . The Company considers the limitation on the exercisability of the Class A-3 and Class B Units to be a performance condition and records compensation cost when it becomes probable that the performance condition will be met. In connection with the Business Combination, each of the Class A-3 Units outstanding prior to the Business Combination were cancelled, and the holder thereof received a number of Class A units representing limited liability company interests of WMH LLC (the “Class A Units”) and an equivalent number of shares of Class V Common Stock, par value $0.0001 per share (together with the Class A Units, the “Paired Interests”), and each of the Class B Units outstanding prior to the Business Combination were cancelled and holders thereof received a number of Class P units representing limited liability company interests of WMH LLC (the “Class P Units” and together with the Class A Units, the “Units”), each in accordance with the Merger Agreement. Concurrently with the closing of the Business Combination, the Unit holders entered into an exchange agreement (the “Exchange Agreement”). The terms of the Exchange Agreement, among other things, provide the Unit holders (or certain permitted transferees thereof) with the right from time to time at and after 180 days following the Business Combination to exchange their vested Paired Interests for shares of Class A Common Stock on a one-for-one basis, subject to customary |
Segment Reporting | Segment Reporting The Company and its subsidiaries operate in one business segment. |
Earnings Per Share | Earnings Per Share Basic net earnings per share is computed by dividing net earnings attributable to WM Technology, Inc. for the period from June 16, 2021 (Closing Date) to June 30, 2021 by the weighted-average number of shares of Class A Common Stock outstanding during the same period. Diluted net earnings per share is computed giving effect to all potential weighted-average dilutive shares for the period. The dilutive effect of outstanding awards or financial instruments, if any, is reflected in diluted earnings per share by application of the treasury stock method or if-converted method, as applicable. Prior to the Business Combination, the membership structure of Legacy WMH included units which had profit interests. The Company analyzed the calculation of earnings per unit for periods prior to the Business Combination and determined that it resulted in values that would not be meaningful to the users of these condensed consolidated financial statements. As a result, earnings per share information has not been presented for periods prior to the Business Combination on June 16, 2021. The basic and diluted earnings (loss) per share for the three and six months ended June 30, 2021 represent only the period from June 16, 2021 to June 30, 2021. |
Warrant Liability | The Company assumed 12,499,933 Public Warrants and 7,000,000 Private Placement Warrants (together, the “Warrants”) upon the Closing, all of which were issued in connection with Silver Spike’s initial public offering and entitle the holder to purchase one share of Class A Common Stock at an exercise price of at $11.50 per share. All of the Warrants remained outstanding as of June 30, 2021. The Public Warrants are publicly traded and are exercisable for cash unless certain conditions occur, such as the failure to have an effective registration statement related to the shares issuable upon exercise or redemption by the Company under certain conditions, at which time the warrants may be cashless exercised. The Private Placement Warrants are transferable, assignable or salable in certain limited exceptions. The Private Placement Warrants are exercisable for cash or on a cashless basis, at the holder’s option, and are non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will cease to be Private Placement Warrants, and become Public Warrants and be redeemable by the Company and exercisable by such holders on the same basis as the other Public Warrants. The Company evaluated the Warrants under ASC 815-40 - Derivatives and Hedging -Contracts in Entity’s Own Equity , and concluded they do not meet the criteria to be classified in stockholders’ equity. Specifically, the exercise of the Warrants may be settled in cash upon the occurrence of a tender offer or exchange that involves 50% or more of our Class A equity holders. Because not all of the voting stockholders need to participate in such tender offer or exchange to trigger the potential cash settlement and the Company does not control the occurrence of such an event, the Company concluded that the Warrants do not meet the conditions to be classified in equity. Since the Warrants meet the definition of a derivative under ASC 815, the Company recorded these warrants as liabilities on the condensed consolidated balance sheets at fair value, with subsequent changes in their respective fair values recognized in change in fair value of warrant liabilities within the condensed consolidated statements of income at each reporting date. |
Fair Value Measurements | Fair Value Measurements The Company follows the guidance in ASC 820 - Fair Value Measurements for its financial assets and liabilities that are re-measured and reported at fair value at each reporting period. The fair value of the Company’s financial assets and liabilities reflects management’s estimate of amounts that the Company would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from independent sources) and to minimize the use of unobservable inputs (internal assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities: • Level 1: Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. • Level 2: Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. • Level 3: Unobservable inputs based on the Company assessment of the assumptions that market participants would use in pricing the asset or liability. |
Tax Receivable Agreement | Tax Receivable Agreement The Business Combination was accomplished through what is commonly referred to as an “Up-C” structure, which is often used by partnerships and limited liability companies undertaking an initial public offering. The Up-C structure allows the Legacy WMH Unit holders to retain their equity ownership in WMH LLC, an entity that is classified as a partnership for U.S. federal income tax purposes, in the form of Units and provides potential future tax benefits for both the Company and the WMH LLC Unit holders when they ultimately exchange their pass-through interests for shares of Class A Common Stock. Additionally, the Company could obtain future increases in its tax basis of the assets of WMH LLC when such units are redeemed or exchanged by the continuing members. This increase in tax basis may have the effect of reducing the amounts paid in the future to various tax authorities. The increase in tax basis may also decrease gains (or increase losses) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets. In connection with the Business Combination, the Company entered into a tax receivable agreement (the “Tax Receivable Agreement”) with continuing members that provides for a payment to the continuing Class A Unit holders of 85% of the amount of tax benefits, if any, that the Company realizes, or is deemed to realize, as a result of redemptions or exchanges of Units. In connection with such potential future tax benefits resulting from the Business Combination, the Company has established a deferred tax asset for the additional tax basis and a corresponding TRA liability of 85% of the expected benefit. The remaining 15% is recorded to additional paid-in capital. |
Leases | Leases Effective January 1, 2021, the Company accounts for its leases under ASC 842, Leases . Under this guidance, lessees classify arrangements meeting the definition of a lease as operating or financing leases, and leases are recorded on the consolidated balance sheet as both a right-of-use asset and lease liability, calculated by discounting fixed lease payments over the lease term at the rate implicit in the lease or the Company’s incremental borrowing rate. Lease liabilities are increased by interest and reduced by payments each period, and the right-of-use asset is amortized over the lease term. For operating leases, interest on the lease liability and the amortization of the right-of-use asset result in straight-line rent expense over the lease term. For finance leases, interest on the lease liability and the amortization of the right-of-use asset results in front-loaded expense over the lease term. Variable lease expenses are recorded when incurred. In calculating the right-of-use asset and lease liability, the Company elects to combine lease and non-lease components for all classes of assets. The Company excludes short-term leases having initial terms of 12 months or less from the new guidance as an accounting policy election, and instead recognizes rent expense on a straight-line basis over the lease term. The Company continues to account for leases in the prior period financial statements under ASC 840, Leases . |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842). The guidance in this ASU supersedes the leasing guidance in Topic 840, Leases. Under the new guidance, lessees are required to recognize lease assets and lease liabilities on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the consolidated statements of operations. The Company adopted ASC 842 as of January 1, 2021, using the modified retrospective transition approach by recording a right-of-use (“ROU”) asset and lease liability for operating leases of $43.3 million and $48.4 million, respectively, at that date; the Company did not have any finance lease assets and liabilities upon adoption or any arrangements where it acts as a lessor. Adoption of ASC 842 did not have an effect on the Company’s retained earnings. The Company availed itself of the practical expedients provided under ASC 842 regarding identification of leases, lease classification, indirect costs, and the combination of lease and non-lease components for all classes of assets. The Company continues to account for leases in the prior period financial statements under ASC 840. |
Summary of significant accoun_3
Summary of significant accounting policies (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Schedule of Disaggregation of Revenue | The following table summarizes the Company’s disaggregated net revenue information (in thousands): Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 Revenues recognized over time (1) $ 46,931 $ 36,790 $ 88,085 $ 68,156 Revenues recognized at a point in time (2) — 1,965 — 2,809 Total revenues $ 46,931 $ 38,755 $ 88,085 $ 70,965 ________________ (1) Revenues from listing subscription services, featured listings and other advertising products. (2) Revenues from use of orders functionality. |
Schedule of Revenue from External Customers by Geographic Areas | The following table summarizes the Company’s U.S. and foreign revenues (in thousands): Three months ended June 30, Six months ended June 30, 2021 2020 2021 2020 U.S. revenues $ 46,931 $ 30,351 $ 88,085 $ 56,398 Foreign revenues — 8,404 — 14,567 Total revenues $ 46,931 $ 38,755 $ 88,085 $ 70,965 |
Schedule of Stock-based Payment Arrangement | The Company recorded stock-based compensation in the following expense categories on the accompanying condensed consolidated statements of income (in thousands): Three and Six Months Ended June 30, 2021 Sales and marketing $ 3,826 Product development 1,994 General and administrative 13,613 Total stock-based compensation $ 19,433 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Leases [Abstract] | |
Lease, Cost | The components of lease related expense for the three and six months ended June 30, 2021 are as follows (in thousands): Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Operating lease cost $ 2,377 $ 4,768 Variable lease cost 639 1,150 Operating lease expense 3,016 5,918 Short-term lease rent expense 67 87 Net rent expense $ 3,083 $ 6,005 |
Schedule of Operating Lease Liability, Maturity | As of June 30, 2021, future minimum payments for the next five years and thereafter are as follows (in thousands): Operating Leases Remaining period in 2021 (six months) $ 4,674 Year ended December 31, 2022 9,597 Year ended December 31, 2023 9,898 Year ended December 31, 2024 9,405 Year ended December 31, 2025 5,830 Thereafter 29,732 Future minimum lease payments $ 69,136 Less: present value discount (21,878) Operating lease liabilities $ 47,258 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value Liabilities Measured on Recurring Basis | The following table presents information about the Company’s liabilities that are measured at fair value on a recurring basis at June 30, 2021 and December 31, 2020, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value (in thousands): Level June 30, 2021 December 31, 2020 Liabilities: Warrant liability – Public Warrants 1 $ 79,375 $ — Warrant liability – Private Placement Warrants 3 76,812 — Total warrant liability $ 156,187 $ — |
Schedule of Derivative Liabilities at Fair Value | The following tables summarize the changes in the fair value of the warrant liabilities (in thousands): Three months ended June 30, 2021 Public Warrants Private Placement Warrants Warrant Liabilities Fair value, beginning of period $ — $ — $ — Warrant liability acquired 100,750 93,228 193,978 Change in valuation inputs or other assumptions (21,375) (16,416) (37,791) Fair value, end of period $ 79,375 $ 76,812 $ 156,187 |
Schedule of Fair Value Measurement Inputs and Valuation Techniques | The following table provides quantitative information regarding Level 3 fair value measurements inputs at their measurement dates: June 16, 2021 June 30, 2021 Exercise price $ 11.50 $ 11.50 Stock price $ 20.55 $ 17.86 Volatility 60.0 % 60.0 % Term (years) 5.00 4.96 Risk-free interest rate 0.89 % 0.86 % |
Business Combination (Tables)
Business Combination (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Reverse Recapitalization [Abstract] | |
Schedule of Reverse Recapitalization | The following table reconciles the elements of the Business Combination to the condensed consolidated statements of cash flows and the condensed consolidated statements of changes in stockholders’ (deficit) equity for the six months ended June 30, 2021 (in thousands): Business Combination Cash - Silver Spike trust and cash, net of redemptions $ 254,203 Cash - PIPE Financing 325,000 Less: cash consideration paid to Legacy WMH equity holders (455,182) Less: transaction costs and advisory fees (43,737) Net proceeds from the Business Combination 80,284 Less: initial fair value of warrant liability recognized in the Business Combination (193,978) Add: transaction costs allocated to Warrants 5,506 Add: non-cash assets assumed from Silver Spike 1,053 Add: deferred tax asset 147,973 Less: tax receivable agreement liability (126,150) Net adjustment to total equity from the Business Combination $ (85,312) The number of shares of common stock issued immediately following the Closing: Number of Shares Common stock, outstanding prior to the Business Combination 24,998,575 Less: redemption of shares of Silver Spike’s Class A common stock 10,012 Shares of Silver Spike’s Class A common stock 24,988,563 Shares of Class A Common Stock held by Silver Spike’s Sponsor 6,250,000 Shares of Class A Common Stock issued in the PIPE Financing 32,500,000 Shares of Class A Common Stock issued in the Business Combination 63,738,563 Shares of Class V Common Stock issued to Legacy WMH equity holders 65,502,347 Total shares of common stock issued in the Business Combination 129,240,910 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The computation of net earnings per share attributable to WM Technology, Inc. and weighted-average shares of the Company’s Class A Common Stock outstanding for period from June 16, 2021 (Closing Date) to June 30, 2021 are as follows (amounts in thousands, except for share and per share amounts): Three Months Ended June 30, 2021 Six Months Ended June 30, 2021 Numerator: Net income $ 16,837 $ 24,568 Less: net income attributable to WMH LLC prior to the Business Combination 7,347 15,078 Less: net income attributable to noncontrolling interests after the Business Combination 5,227 5,227 Net income attributable to WM Technology, Inc. - basic 4,263 4,263 Effect of dilutive securities: Less: fair value change of Public and Private Placement Warrants, net of amounts attributable to noncontrolling interests 16,061 16,061 Net loss attributable to WM Technology, Inc. - diluted $ (11,798) $ (11,798) Denominator: Weighted average common shares outstanding - basic 63,738,563 63,738,563 Weighted average effect of dilutive securities: Public Warrants¹ 4,877,681 4,877,681 Private Placement Warrants¹ 2,731,502 2,731,502 Weighted average common shares outstanding - diluted 71,347,746 71,347,746 Net income (loss) per share of Class A Common Stock: Net income per share of Class A Common Stock - basic $ 0.07 $ 0.07 Net loss per share of Class A Common Stock - diluted $ (0.17) $ (0.17) ____________________________________ |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The Company excluded the following securities from its computation of diluted shares outstanding, as their effect would have been anti-dilutive: June 30, 2021 Class A Units 65,502,347 Class P Units 25,679,121 Total Units 91,181,468 |
Summary of significant accoun_4
Summary of significant accounting policies - Additional Information (Details) $ / shares in Units, $ in Thousands | Jun. 30, 2021USD ($)$ / shares | Jun. 16, 2021$ / sharesshares | Jun. 30, 2021USD ($)$ / shares | Mar. 31, 2021USD ($) | Jun. 30, 2020USD ($) | Jun. 30, 2021USD ($)segment$ / shares | Jun. 30, 2020USD ($) | Jun. 30, 2022USD ($) | Jan. 01, 2021USD ($) | Dec. 31, 2020USD ($) |
Accounting Policies [Line Items] | ||||||||||
Allowance of bad debt | $ 700 | $ 700 | $ 700 | |||||||
Deferred revenue | 6,900 | 6,900 | 6,900 | $ 5,300 | ||||||
Revenue recognized | $ 5,300 | |||||||||
Income tax expense (benefit) | 392 | $ 0 | 151 | $ 0 | ||||||
Advertising expense | 4,800 | 2,600 | 7,800 | 4,300 | ||||||
Political contributions | 300 | $ 100 | 300 | $ 300 | ||||||
Period of exchange agreement | 180 days | |||||||||
Shares converted basis (in shares) | shares | 1 | |||||||||
Total stock-based compensation | $ 19,400 | $ 19,433 | 19,433 | |||||||
Award modification, incremental expense | $ 4,100 | |||||||||
Number of operating segments | segment | 1 | |||||||||
Number of reportable segments | segment | 1 | |||||||||
Tax receivable agreement liabilities as percent of expected benefit | 85.00% | 85.00% | 85.00% | |||||||
Tax receivable agreement, percent recorded in additional paid-in capital | 15.00% | 15.00% | 15.00% | |||||||
Operating lease, right-of-use asset | $ 38,779 | $ 38,779 | $ 38,779 | $ 43,300 | ||||||
Operating lease liabilities | $ 47,258 | $ 47,258 | $ 47,258 | $ 48,400 | ||||||
Class V Common Stock | ||||||||||
Accounting Policies [Line Items] | ||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||
Class A Common Stock, $0.0001 par value per share | ||||||||||
Accounting Policies [Line Items] | ||||||||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||||
Payment to continuing members as percent of amount of tax benefit | 85.00% | 85.00% | 85.00% | |||||||
Forecast | ||||||||||
Accounting Policies [Line Items] | ||||||||||
Revenue recognized | $ 6,900 | |||||||||
Class P Units | ||||||||||
Accounting Policies [Line Items] | ||||||||||
Nonvested award, cost not yet recognized | $ 5,700 | $ 5,700 | $ 5,700 | |||||||
Nonvested award, period for recognition | 2 years 4 months 24 days | |||||||||
Silver Spike | Legacy WMH Class A Unit holders | ||||||||||
Accounting Policies [Line Items] | ||||||||||
Percentage of voting interests held (over 50%) | 50.00% | 50.00% | 50.00% |
Summary of significant accoun_5
Summary of significant accounting policies - Disaggregated Net Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 46,931 | $ 38,755 | $ 88,085 | $ 70,965 |
Revenues recognized over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 46,931 | 36,790 | 88,085 | 68,156 |
Revenues recognized at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 0 | $ 1,965 | $ 0 | $ 2,809 |
Summary of significant accoun_6
Summary of significant accounting policies - Revenue by Geographic Areas (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 46,931 | $ 38,755 | $ 88,085 | $ 70,965 |
U.S. revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 46,931 | 30,351 | 88,085 | 56,398 |
Foreign revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 0 | $ 8,404 | $ 0 | $ 14,567 |
Summary of significant accoun_7
Summary of significant accounting policies - Stock-Based Compensation (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2021 |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation | $ 19,400 | $ 19,433 | $ 19,433 |
Sales and marketing | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation | 3,826 | 3,826 | |
Product development | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation | 1,994 | 1,994 | |
General and administrative | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total stock-based compensation | $ 13,613 | $ 13,613 |
Summary of significant accoun_8
Summary of significant accounting policies - Warrant Liabilities (Details) - $ / shares | Jun. 30, 2021 | Jun. 16, 2021 |
Class A Common Stock | ||
Class of Warrant or Right [Line Items] | ||
Exercise price of warrant (in dollars per share) | $ 11.50 | |
Minimum requirement for cash settlement as percent of stockholders | 50.00% | |
Public Warrants | ||
Class of Warrant or Right [Line Items] | ||
Warrants outstanding (in shares) | 12,499,933 | |
Private Placement Warrant | ||
Class of Warrant or Right [Line Items] | ||
Warrants outstanding (in shares) | 7,000,000 | 7,000,000 |
Leases - Cost Components (Detai
Leases - Cost Components (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2021 | Jun. 30, 2021 | |
Leases [Abstract] | ||
Operating lease cost | $ 2,377 | $ 4,768 |
Variable lease cost | 639 | 1,150 |
Operating lease expense | 3,016 | 5,918 |
Short-term lease rent expense | 67 | 87 |
Net rent expense | $ 3,083 | $ 6,005 |
Leases - Future Minimum Payment
Leases - Future Minimum Payments (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Jan. 01, 2021 |
Leases [Abstract] | ||
Remaining period in 2021 (six months) | $ 4,674 | |
Year ended December 31, 2022 | 9,597 | |
Year ended December 31, 2023 | 9,898 | |
Year ended December 31, 2024 | 9,405 | |
Year ended December 31, 2025 | 5,830 | |
Thereafter | 29,732 | |
Future minimum lease payments | 69,136 | |
Less: present value discount | (21,878) | |
Operating lease liabilities | $ 47,258 | $ 48,400 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | |
Leases [Abstract] | |||
Cash payments on operating leases | $ 2,400 | $ 3,500 | |
Right-of-use assets obtained in exchange for operating lease liabilities | $ 43,300 | ||
Remaining lease term | 7 years 9 months 18 days | 7 years 9 months 18 days | |
Weighted average discount rate | 9.80% | 9.80% | |
Operating lease, impairment loss | $ 2,400 | $ 2,372 | $ 0 |
Fair Value Measurements - Warra
Fair Value Measurements - Warrants (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Jun. 30, 2021 | Jun. 16, 2021 | Dec. 31, 2020 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Warrant liability | $ 156,187 | ||
Changes In Fair Value Of Warrant Liabilities [Roll Forward] | |||
Fair value, beginning of period | 0 | ||
Warrant liability acquired | 193,978 | ||
Change in valuation inputs or other assumptions | (37,791) | ||
Fair value, end of period | 156,187 | ||
Warrant liability | $ 156,187 | $ 0 | |
Warrants | |||
Changes In Fair Value Of Warrant Liabilities [Roll Forward] | |||
Remaining maturity | 5 years | ||
Public Warrants | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Warrant liability | $ 79,375 | ||
Changes In Fair Value Of Warrant Liabilities [Roll Forward] | |||
Fair value, beginning of period | 0 | ||
Warrant liability acquired | 100,750 | ||
Change in valuation inputs or other assumptions | (21,375) | ||
Fair value, end of period | 79,375 | ||
Private Placement Warrant | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Warrant liability | 76,812 | ||
Changes In Fair Value Of Warrant Liabilities [Roll Forward] | |||
Fair value, beginning of period | 0 | ||
Warrant liability acquired | 93,228 | ||
Change in valuation inputs or other assumptions | (16,416) | ||
Fair value, end of period | 76,812 | ||
Level 1 | Public Warrants | |||
Changes In Fair Value Of Warrant Liabilities [Roll Forward] | |||
Warrant liability | 79,400 | $ 100,800 | |
Level 3 | Private Placement Warrant | |||
Changes In Fair Value Of Warrant Liabilities [Roll Forward] | |||
Warrant liability | 76,800 | $ 93,200 | |
Recurring Basis | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Warrant liability | 156,187 | 0 | |
Changes In Fair Value Of Warrant Liabilities [Roll Forward] | |||
Fair value, end of period | 156,187 | ||
Recurring Basis | Level 1 | Public Warrants | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Warrant liability | 79,375 | 0 | |
Changes In Fair Value Of Warrant Liabilities [Roll Forward] | |||
Fair value, end of period | 79,375 | ||
Recurring Basis | Level 3 | Private Placement Warrant | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Warrant liability | 76,812 | $ 0 | |
Changes In Fair Value Of Warrant Liabilities [Roll Forward] | |||
Fair value, end of period | $ 76,812 |
Fair Value Measurements - Quant
Fair Value Measurements - Quantitative Information (Details) - Level 3 - Private Placement Warrant - vote | Jun. 30, 2021 | Jun. 16, 2021 |
Exercise price | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants, measurement input | 11.50 | 11.50 |
Stock price | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants, measurement input | 17.86 | 20.55 |
Volatility | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants, measurement input | 0.600 | 0.600 |
Term (years) | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants, measurement input | 4.96 | 5 |
Risk-free interest rate | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants, measurement input | 0.0086 | 0.0089 |
Business Combination - Addition
Business Combination - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | Jun. 30, 2021 | Jun. 16, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2020 | Mar. 31, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 17, 2021 |
Schedule Of Reverse Recapitalization [Line Items] | |||||||||
Cash consideration paid to Legacy WMH equity holders | $ 455,182 | ||||||||
Common stock, shares outstanding (in shares) | 129,240,910 | ||||||||
Period of exchange agreement | 180 days | ||||||||
Shares converted basis (in shares) | 1 | ||||||||
Net income attributable to WM Technology, Inc. | $ 9,500 | $ 4,263 | $ 7,731 | $ 9,393 | $ 3,809 | $ 4,263 | $ 13,202 | ||
Change in fair value of warrant liability | (37,800) | (37,791) | $ 0 | (37,791) | $ 0 | ||||
Total stock-based compensation | 19,400 | $ 19,433 | $ 19,433 | ||||||
Add: transaction costs allocated to Warrants | $ 5,500 | $ 5,506 | |||||||
WMH LLC | |||||||||
Schedule Of Reverse Recapitalization [Line Items] | |||||||||
Contributions made | $ 80,300 | ||||||||
Class A Common Stock | |||||||||
Schedule Of Reverse Recapitalization [Line Items] | |||||||||
Number of shares issued in transaction (in shares) | 32,500,000 | ||||||||
Price per share (in dollars per share) | $ 10 | ||||||||
Consideration received on transaction | $ 325,000 | ||||||||
Stock redeemed during period (in shares) | 10,012 | ||||||||
Cash consideration paid to Legacy WMH equity holders | $ 455,200 | ||||||||
Common stock, shares outstanding (in shares) | 63,738,563 | 63,738,563 | 63,738,563 | ||||||
Shares of Class A Common Stock issued in the Business Combination (in shares) | 63,738,563 | ||||||||
Payment to continuing members as percent of amount of tax benefit | 85.00% | 85.00% | 85.00% | ||||||
Class A Common Stock | Common Stock | |||||||||
Schedule Of Reverse Recapitalization [Line Items] | |||||||||
Common stock, shares outstanding (in shares) | 63,738,563 | 63,738,563 | 0 | 63,738,563 | |||||
Shares of Class A Common Stock issued in the Business Combination (in shares) | 63,738,563 | ||||||||
Class V Common Stock | |||||||||
Schedule Of Reverse Recapitalization [Line Items] | |||||||||
Common stock, shares outstanding (in shares) | 65,502,347 | 65,502,347 | 65,502,347 | ||||||
Shares of Class A Common Stock issued in the Business Combination (in shares) | 65,502,347 | ||||||||
Class V Common Stock | Common Stock | |||||||||
Schedule Of Reverse Recapitalization [Line Items] | |||||||||
Common stock, shares outstanding (in shares) | 65,502,347 | 65,502,347 | 0 | 65,502,347 | |||||
Shares of Class A Common Stock issued in the Business Combination (in shares) | 65,502,347 | ||||||||
Class A Units | |||||||||
Schedule Of Reverse Recapitalization [Line Items] | |||||||||
Common stock, shares outstanding (in shares) | 65,502,347 | ||||||||
Class P Units | |||||||||
Schedule Of Reverse Recapitalization [Line Items] | |||||||||
Common stock, shares outstanding (in shares) | 25,896,042 |
Business Combination - Elements
Business Combination - Elements of Business Combination (Details) - USD ($) $ in Thousands | Jun. 30, 2021 | Jun. 16, 2021 | Jun. 30, 2021 | Jun. 30, 2020 |
Reverse Recapitalization [Abstract] | ||||
Cash - Silver Spike trust and cash, net of redemptions | $ 254,203 | |||
Cash - PIPE Financing | 325,000 | |||
Less: cash consideration paid to Legacy WMH equity holders | (455,182) | |||
Less: transaction costs and advisory fees | (43,737) | |||
Net proceeds from the Business Combination | 80,284 | $ 80,284 | $ 0 | |
Less: initial fair value of warrant liability recognized in the Business Combination | (193,978) | (193,978) | 0 | |
Add: transaction costs allocated to Warrants | $ 5,500 | 5,506 | ||
Add: non-cash assets assumed from Silver Spike | 1,053 | 1,053 | 0 | |
Add: deferred tax asset | 147,973 | 147,973 | 0 | |
Less: tax receivable agreement liability | (126,150) | $ (126,150) | $ 0 | |
Net adjustment to total equity from the Business Combination | $ (85,312) |
Business Combination - Number o
Business Combination - Number of Shares (Details) - shares | Jun. 16, 2021 | Jun. 30, 2021 | Jun. 17, 2021 |
Schedule Of Reverse Recapitalization [Line Items] | |||
Common stock, outstanding prior to Business Combination (in shares) | 129,240,910 | ||
Total shares of common stock issued in the Business Combination (in shares) | 129,240,910 | ||
Class A Common Stock | |||
Schedule Of Reverse Recapitalization [Line Items] | |||
Common stock, outstanding prior to Business Combination (in shares) | 63,738,563 | ||
Shares of Class A Common Stock issued in the PIPE Financing (in shares) | 32,500,000 | ||
Shares of Class A Common Stock issued in the Business Combination (in shares) | 63,738,563 | ||
Total shares of common stock issued in the Business Combination (in shares) | 63,738,563 | ||
Class V Common Stock | |||
Schedule Of Reverse Recapitalization [Line Items] | |||
Common stock, outstanding prior to Business Combination (in shares) | 65,502,347 | ||
Shares of Class A Common Stock issued in the Business Combination (in shares) | 65,502,347 | ||
Shares of Class V Common Stock issued to Legacy WMH equity holders (in shares) | 65,502,347 | ||
Total shares of common stock issued in the Business Combination (in shares) | 65,502,347 | ||
Common Shareholders | |||
Schedule Of Reverse Recapitalization [Line Items] | |||
Shares of common stock (in shares) | 24,988,563 | ||
Sponsor | Class A Common Stock | |||
Schedule Of Reverse Recapitalization [Line Items] | |||
Shares of common stock (in shares) | 6,250,000 | ||
Silver Spike | |||
Schedule Of Reverse Recapitalization [Line Items] | |||
Common stock, outstanding prior to Business Combination (in shares) | 24,998,575 | ||
Less: redemption of shares of Silver Spike’s Class A common stock (in shares) | 10,012 | ||
Total shares of common stock issued in the Business Combination (in shares) | 24,998,575 |
Warrant Liability (Details)
Warrant Liability (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 16, 2021 | Jun. 30, 2021 | Jun. 07, 2019 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 16, 2021 |
Derivative [Line Items] | ||||||||
Unit price (in dollars per share) | $ 11.50 | |||||||
Change in fair value of warrant liability | $ 37,800 | $ 37,791 | $ 0 | $ 37,791 | $ 0 | |||
Public Warrants | ||||||||
Derivative [Line Items] | ||||||||
Warrants outstanding (in shares) | 12,499,933 | 12,499,933 | 12,499,933 | |||||
Units issued (in shares) | 12,500,000 | |||||||
Private Placement Warrant | ||||||||
Derivative [Line Items] | ||||||||
Warrants outstanding (in shares) | 7,000,000 | 7,000,000 | 7,000,000 | 7,000,000 | ||||
Number of ordinary shares called by each warrant (in shares) | 1 | 1 | 1 | |||||
Warrants issued (in shares) | 7,000,000 | |||||||
Limitation period to transfer, assign or sell warrants | 30 days | |||||||
Subsequent Event | ||||||||
Derivative [Line Items] | ||||||||
Notice period to redeem warrants | 30 days | |||||||
Threshold trading days | 20 days | |||||||
Trading period | 30 days | |||||||
Subsequent Event | Common Stock | ||||||||
Derivative [Line Items] | ||||||||
Stock price trigger (in dollars per share) | $ 18 | |||||||
Subsequent Event | Public Warrants | ||||||||
Derivative [Line Items] | ||||||||
Warrant redemption price (in dollars per share) | $ 0.01 | |||||||
Class A Common Stock | ||||||||
Derivative [Line Items] | ||||||||
Number of ordinary shares called by each warrant (in shares) | 1 | |||||||
Exercise price of warrant (in dollars per share) | $ 11.50 | $ 11.50 | $ 11.50 |
Equity (Details)
Equity (Details) | 3 Months Ended | |
Jun. 30, 2021voteshares | Jun. 15, 2021shares | |
Class of Stock [Line Items] | ||
Preferred stock, shares authorized (in shares) | 75,000,000 | 75,000,000 |
Preferred stock, shares issued (in shares) | 0 | |
Preferred stock, shares outstanding (in shares) | 0 | |
WMH Units | ||
Noncontrolling Interest [Line Items] | ||
Noncontrolling interests, percent of outstanding units held | 57.50% | |
Class A Common Stock | ||
Class of Stock [Line Items] | ||
Votes per share | vote | 1 |
Earnings Per Share - Computatio
Earnings Per Share - Computation (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | |
Numerator: | ||||
Net income | $ 16,837 | $ 9,393 | $ 24,568 | $ 13,202 |
Less: net income attributable to WMH LLC prior to the Business Combination | 7,347 | 15,078 | ||
Less: net income attributable to noncontrolling interests after the Business Combination | 5,227 | 5,227 | ||
Net income attributable to WM Technology, Inc. - basic | 4,263 | 4,263 | ||
Effect of dilutive securities: | ||||
Less: fair value change of Public and Private Placement Warrants, net of amounts attributable to noncontrolling interests | 16,061 | 16,061 | ||
Net loss attributable to WM Technology, Inc. - diluted | $ (11,798) | $ (11,798) | ||
Class A Common Stock | ||||
Denominator: | ||||
Weighted average common shares outstanding - basic (in shares) | 63,738,563 | 63,738,563 | ||
Weighted average common shares outstanding - diluted (in shares) | 71,347,746 | 71,347,746 | ||
Net income (loss) per share of Class A Common Stock: | ||||
Basic income per share - Class A (in dollars per share) | $ 0.07 | $ 0.07 | ||
Diluted loss per share - Class A (in dollars per share) | $ (0.17) | $ (0.17) | ||
Public Warrants | ||||
Denominator: | ||||
Warrants | 4,877,681 | 4,877,681 | ||
Private Placement Warrant | ||||
Denominator: | ||||
Warrants | 2,731,502 | 2,731,502 |
Earnings Per Share - Dilutive S
Earnings Per Share - Dilutive Securities (Details) | 3 Months Ended |
Jun. 30, 2021shares | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive securities excluded from computation of earnings per share (in shares) | 91,181,468 |
Class A Units | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive securities excluded from computation of earnings per share (in shares) | 65,502,347 |
Class P Units | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Antidilutive securities excluded from computation of earnings per share (in shares) | 25,679,121 |