Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 03, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-39774 | |
Entity Registrant Name | Rover Group, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 85-3147201 | |
Entity Address, Address Line One | 720 Olive Way, | |
Entity Address, Address Line Two | 19th Floor | |
Entity Address, City or Town | Seattle | |
Entity Address, State or Province | WA | |
Entity Address, Postal Zip Code | 98101 | |
City Area Code | 888 | |
Local Phone Number | 453-7889 | |
Title of 12(b) Security | Class A Common Stock, par value $0.0001 per share | |
Trading Symbol | ROVR | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 179,432,117 | |
Entity Central Index Key | 0001826018 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current assets | ||
Cash and cash equivalents | $ 129,142 | $ 58,875 |
Short-term investments | 74,822 | 191,347 |
Accounts receivable, net | 76,473 | 53,181 |
Notes receivable from related parties | 0 | 1,810 |
Prepaid expenses and other current assets | 7,868 | 6,829 |
Total current assets | 288,305 | 312,042 |
Restricted cash | 3,675 | 0 |
Property and equipment, net | 19,261 | 19,518 |
Operating lease right-of-use assets | 17,211 | 18,871 |
Intangible assets, net | 2,511 | 6,865 |
Goodwill | 33,159 | 36,915 |
Deferred tax asset, net | 1,361 | 1,306 |
Long-term investments | 26,918 | 22,463 |
Investment in equity securities in related parties | 3,444 | 0 |
Other noncurrent assets | 1,045 | 281 |
Total assets | 396,890 | 418,261 |
Current liabilities | ||
Accounts payable | 5,914 | 5,354 |
Accrued compensation and related expenses | 6,239 | 6,644 |
Accrued expenses and other current liabilities | 6,491 | 22,694 |
Deferred revenue | 13,112 | 5,544 |
Pet parent deposits | 50,195 | 40,783 |
Pet care provider liabilities | 2,155 | 3,319 |
Operating lease liabilities, current portion | 2,613 | 2,727 |
Total current liabilities | 86,719 | 87,065 |
Operating lease liabilities, net of current portion | 19,943 | 22,208 |
Other noncurrent liabilities | 409 | 714 |
Total liabilities | 107,071 | 109,987 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, $0.0001 par value, 10,000 shares authorized as of September 30, 2023 and December 31, 2022; no shares issued and outstanding as of September 30, 2023 and December 31, 2022 | 0 | 0 |
Class A common stock, $0.0001 par value, 990,000 shares authorized as of September 30, 2023 and December 31, 2022; 180,836 and 184,526 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively | 18 | 18 |
Additional paid-in capital | 667,007 | 651,659 |
Accumulated other comprehensive loss | (157) | (1,098) |
Accumulated deficit | (377,049) | (342,305) |
Total stockholders’ equity | 289,819 | 308,274 |
Total liabilities and stockholders’ equity | $ 396,890 | $ 418,261 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2023 | Dec. 31, 2022 |
Stockholders’ equity: | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 990,000,000 | 990,000,000 |
Common stock, shares issued (in shares) | 180,836,000 | 184,526,000 |
Common stock, shares outstanding (in shares) | 180,836,000 | 184,526,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||||
Revenue | $ 66,203 | $ 50,864 | $ 165,852 | $ 122,059 |
Costs and expenses: | ||||
Cost of revenue (exclusive of depreciation and amortization shown separately below) | 13,634 | 11,607 | 37,022 | 29,976 |
Operations and support | 8,156 | 7,425 | 22,985 | 19,265 |
Marketing | 12,684 | 8,686 | 35,401 | 27,044 |
Product development | 8,566 | 7,100 | 24,164 | 20,380 |
General and administrative | 13,599 | 30,599 | 39,640 | 53,616 |
Depreciation and amortization | 1,189 | 1,561 | 4,143 | 4,432 |
Impairment loss on intangible assets and goodwill | 0 | 0 | 6,916 | 0 |
Total costs and expenses | 57,828 | 66,978 | 170,271 | 154,713 |
Income (loss) from operations | 8,375 | (16,114) | (4,419) | (32,654) |
Other income (expense), net: | ||||
Interest income | 3,152 | 1,287 | 8,566 | 2,084 |
Interest expense | (15) | (19) | (51) | (61) |
Change in fair value of other investments | 0 | 0 | 1,115 | 0 |
Change in fair value of derivative warrant liabilities | 0 | 0 | 0 | 4,579 |
Other (expense) income, net | (568) | (257) | 1,560 | (1,045) |
Total other income (expense), net | 2,569 | 1,011 | 11,190 | 5,557 |
Income (loss) before income taxes and equity method investments | 10,944 | (15,103) | 6,771 | (27,097) |
(Provision for) benefit from income taxes | (128) | (44) | (199) | 172 |
Loss from equity method investments, net of tax | (316) | (325) | (981) | (325) |
Net income (loss) | $ 10,500 | $ (15,472) | $ 5,591 | $ (27,250) |
Net income (loss) per share attributable to common stockholders: | ||||
Basic (in dollars per share) | $ 0.06 | $ (0.08) | $ 0.03 | $ (0.15) |
Diluted (in dollars per share) | $ 0.05 | $ (0.08) | $ 0.03 | $ (0.15) |
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders: | ||||
Basic (in shares) | 181,423 | 182,493 | 183,126 | 181,309 |
Diluted (in shares) | 192,977 | 182,493 | 193,704 | 181,309 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 10,500 | $ (15,472) | $ 5,591 | $ (27,250) |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustments | (78) | (164) | 13 | (389) |
Unrealized gain (loss) on available-for-sale debt securities | 125 | (543) | 928 | (1,539) |
Other comprehensive income (loss), net of tax | 47 | (707) | 941 | (1,928) |
Comprehensive income (loss) | $ 10,547 | $ (16,179) | $ 6,532 | $ (29,178) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Stockholders’ Equity - USD ($) shares in Thousands, $ in Thousands | Total | Warrant | Common Stock | Common Stock Warrant | Additional Paid-In Capital | Additional Paid-In Capital Warrant | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit |
Beginning balance (in shares) at Dec. 31, 2021 | 177,342 | |||||||
Beginning balance at Dec. 31, 2021 | $ 292,592 | $ 18 | $ 612,680 | $ 220 | $ (320,326) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Reclassification of derivative warrant liability and issuance of common stock from exercises of warrants (in shares) | 2,046 | |||||||
Reclassification of derivative warrant liability and issuance of common stock from exercises of warrants | $ 15,356 | $ 15,356 | ||||||
Issuance of common stock upon exercise of stock options (in shares) | 2,242 | |||||||
Issuance of common stock upon exercise of stock options | 2,005 | 2,005 | ||||||
Issuance of common stock upon release of restricted stock units (in shares) | 200 | |||||||
Issuance of common stock upon release of restricted stock units | 348 | 348 | ||||||
Taxes paid related to settlement of equity awards | (393) | (393) | ||||||
Stock-based compensation | 4,447 | 4,447 | ||||||
Foreign currency translation adjustments | (61) | (61) | ||||||
Unrealized gain (loss) on available-for-sale debt securities | (410) | (410) | ||||||
Net income (loss) | (8,146) | (8,146) | ||||||
Ending balance (in shares) at Mar. 31, 2022 | 181,830 | |||||||
Ending balance at Mar. 31, 2022 | 305,738 | $ 18 | 634,443 | (251) | (328,472) | |||
Beginning balance (in shares) at Dec. 31, 2021 | 177,342 | |||||||
Beginning balance at Dec. 31, 2021 | 292,592 | $ 18 | 612,680 | 220 | (320,326) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Foreign currency translation adjustments | (389) | |||||||
Unrealized gain (loss) on available-for-sale debt securities | (1,539) | |||||||
Net income (loss) | (27,250) | |||||||
Ending balance (in shares) at Sep. 30, 2022 | 183,567 | |||||||
Ending balance at Sep. 30, 2022 | 296,317 | $ 18 | 645,583 | (1,708) | (347,576) | |||
Beginning balance (in shares) at Mar. 31, 2022 | 181,830 | |||||||
Beginning balance at Mar. 31, 2022 | 305,738 | $ 18 | 634,443 | (251) | (328,472) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common stock upon exercise of stock options (in shares) | 504 | |||||||
Issuance of common stock upon exercise of stock options | 674 | 674 | ||||||
Issuance of common stock upon release of restricted stock units (in shares) | 442 | |||||||
Issuance of common stock upon release of restricted stock units | 764 | 764 | ||||||
Taxes paid related to settlement of equity awards | (908) | (908) | ||||||
Stock-based compensation | 5,099 | 5,099 | ||||||
Foreign currency translation adjustments | (164) | (164) | ||||||
Unrealized gain (loss) on available-for-sale debt securities | (586) | (586) | ||||||
Net income (loss) | (3,632) | (3,632) | ||||||
Ending balance (in shares) at Jun. 30, 2022 | 182,776 | |||||||
Ending balance at Jun. 30, 2022 | 306,985 | $ 18 | 640,072 | (1,001) | (332,104) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common stock upon exercise of stock options (in shares) | 141 | |||||||
Issuance of common stock upon exercise of stock options | 273 | 273 | ||||||
Issuance of common stock upon release of restricted stock units (in shares) | 650 | |||||||
Issuance of common stock upon release of restricted stock units | 908 | 908 | ||||||
Taxes paid related to settlement of equity awards | (923) | (923) | ||||||
Stock-based compensation | 5,253 | 5,253 | ||||||
Foreign currency translation adjustments | (164) | (164) | ||||||
Unrealized gain (loss) on available-for-sale debt securities | (543) | (543) | ||||||
Net income (loss) | (15,472) | (15,472) | ||||||
Ending balance (in shares) at Sep. 30, 2022 | 183,567 | |||||||
Ending balance at Sep. 30, 2022 | $ 296,317 | $ 18 | 645,583 | (1,708) | (347,576) | |||
Beginning balance (in shares) at Dec. 31, 2022 | 184,526 | 184,526 | ||||||
Beginning balance at Dec. 31, 2022 | $ 308,274 | $ 18 | 651,659 | (1,098) | (342,305) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common stock upon exercise of stock options (in shares) | 1,039 | |||||||
Issuance of common stock upon exercise of stock options | 1,847 | $ 1 | 1,846 | |||||
Issuance of common stock upon release of restricted stock units (in shares) | 308 | |||||||
Taxes paid related to settlement of equity awards | (1,129) | (1,129) | ||||||
Repurchase and retirement of common stock (in shares) | (632) | |||||||
Repurchase and retirement of common stock | (3,056) | (3,056) | ||||||
Stock-based compensation | 4,979 | 4,979 | ||||||
Foreign currency translation adjustments | 57 | 57 | ||||||
Unrealized gain (loss) on available-for-sale debt securities | 594 | 594 | ||||||
Net income (loss) | (4,656) | (4,656) | ||||||
Ending balance (in shares) at Mar. 31, 2023 | 185,241 | |||||||
Ending balance at Mar. 31, 2023 | $ 306,910 | $ 19 | 657,355 | (447) | (350,017) | |||
Beginning balance (in shares) at Dec. 31, 2022 | 184,526 | 184,526 | ||||||
Beginning balance at Dec. 31, 2022 | $ 308,274 | $ 18 | 651,659 | (1,098) | (342,305) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common stock upon exercise of stock options (in shares) | 1,960 | |||||||
Foreign currency translation adjustments | $ 13 | |||||||
Unrealized gain (loss) on available-for-sale debt securities | 928 | |||||||
Net income (loss) | $ 5,591 | |||||||
Ending balance (in shares) at Sep. 30, 2023 | 180,836 | 180,836 | ||||||
Ending balance at Sep. 30, 2023 | $ 289,819 | $ 18 | 667,007 | (157) | (377,049) | |||
Beginning balance (in shares) at Mar. 31, 2023 | 185,241 | |||||||
Beginning balance at Mar. 31, 2023 | 306,910 | $ 19 | 657,355 | (447) | (350,017) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common stock upon exercise of stock options (in shares) | 533 | |||||||
Issuance of common stock upon exercise of stock options | 1,153 | 1,153 | ||||||
Issuance of common stock upon release of restricted stock units (in shares) | 879 | |||||||
Taxes paid related to settlement of equity awards | (2,245) | (2,245) | ||||||
Repurchase and retirement of common stock (in shares) | (3,495) | |||||||
Repurchase and retirement of common stock | (16,684) | $ (1) | (16,683) | |||||
Stock-based compensation | 6,427 | 6,427 | ||||||
Foreign currency translation adjustments | 34 | 34 | ||||||
Unrealized gain (loss) on available-for-sale debt securities | 209 | 209 | ||||||
Net income (loss) | (253) | (253) | ||||||
Ending balance (in shares) at Jun. 30, 2023 | 183,158 | |||||||
Ending balance at Jun. 30, 2023 | 295,551 | $ 18 | 662,690 | (204) | (366,953) | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common stock upon exercise of stock options (in shares) | 387 | |||||||
Issuance of common stock upon exercise of stock options | 931 | 931 | ||||||
Issuance of common stock upon release of restricted stock units (in shares) | 746 | |||||||
Taxes paid related to settlement of equity awards | (3,100) | (3,100) | ||||||
Repurchase and retirement of common stock (in shares) | (3,455) | |||||||
Repurchase and retirement of common stock | (20,596) | (20,596) | ||||||
Stock-based compensation | 6,486 | 6,486 | ||||||
Foreign currency translation adjustments | (78) | (78) | ||||||
Unrealized gain (loss) on available-for-sale debt securities | 125 | 125 | ||||||
Net income (loss) | $ 10,500 | 10,500 | ||||||
Ending balance (in shares) at Sep. 30, 2023 | 180,836 | 180,836 | ||||||
Ending balance at Sep. 30, 2023 | $ 289,819 | $ 18 | $ 667,007 | $ (157) | $ (377,049) |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
OPERATING ACTIVITIES | ||
Net income (loss) | $ 5,591 | $ (27,250) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Stock-based compensation | 16,436 | 14,025 |
Depreciation and amortization | 9,642 | 9,634 |
Non-cash operating lease costs | 1,659 | 2,065 |
Impairment loss on intangible assets and goodwill | 6,916 | 0 |
Change in fair value of other investments | (1,115) | 0 |
Change in fair value of derivative warrant liabilities | 0 | (4,579) |
Net accretion of investment discounts | (2,896) | (523) |
Deferred income taxes | (45) | (225) |
Loss on disposal of property and equipment | 102 | 30 |
Loss from equity method investments | 981 | 325 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (23,292) | (23,480) |
Prepaid expenses and other current assets | (1,039) | (753) |
Other noncurrent assets | (764) | (10) |
Accounts payable | 560 | (373) |
Accrued expenses and other current liabilities | (16,796) | 17,799 |
Deferred revenue and pet parent deposits | 16,980 | 16,807 |
Pet care provider liabilities | (1,164) | (7,104) |
Operating lease liabilities | (2,379) | (2,358) |
Other noncurrent liabilities | (305) | 132 |
Net cash provided by (used in) operating activities | 9,072 | (5,838) |
INVESTING ACTIVITIES | ||
Purchases of property and equipment | (550) | (443) |
Capitalization of internal-use software | (6,288) | (5,751) |
Proceeds from disposal of property and equipment | 0 | 2 |
Acquisition of businesses, net of cash acquired | 0 | (5,711) |
Purchases of convertible notes | 0 | (1,310) |
Purchases of equity securities in related parties | (1,500) | 0 |
Purchases of available-for-sale securities | (112,035) | (252,282) |
Proceeds from sales of available-for-sale securities | 57,775 | 0 |
Maturities of available-for-sale securities | 170,153 | 55,383 |
Net cash provided by (used in) investing activities | 107,555 | (210,112) |
FINANCING ACTIVITIES | ||
Proceeds from exercise of stock options and issuance of common stock | 3,930 | 4,972 |
Redemption of common stock warrants | 0 | (7) |
Repurchases of common stock | (40,136) | 0 |
Taxes paid related to settlement of equity awards | (6,474) | (2,224) |
Net cash (used in) provided by financing activities | (42,680) | 2,741 |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | (5) | (177) |
Net increase (decrease) in cash, cash equivalents, and restricted cash | 73,942 | (213,386) |
Cash, cash equivalents, and restricted cash, beginning of period | 58,875 | 278,904 |
Cash, cash equivalents, and restricted cash, end of period | 132,817 | 65,518 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Cash paid for income taxes | 550 | 45 |
Cash paid for interest | 4 | 7 |
NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Purchases of property and equipment in accounts payable and accrued liabilities | 0 | 138 |
Right-of-use assets obtained in exchange for lease liabilities | 0 | 16 |
Conversion of promissory notes to equity security investment in related parties | 2,345 | 0 |
Reclassification of certain derivative warrant liabilities to equity upon exercise | 0 | 15,356 |
Recognition of indemnity holdback liabilities upon acquisition of businesses | 0 | 1,563 |
Stock-based compensation capitalized to internal-use software | 1,459 | 773 |
Reconciliation of Cash, Cash Equivalents, and Restricted Cash | ||
Cash and cash equivalents | 129,142 | 65,518 |
Restricted cash | 3,675 | 0 |
Total cash, cash equivalents, and restricted cash | $ 132,817 | $ 65,518 |
Organization and Description of
Organization and Description of Business | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business | Organization and Description of Business Rover Group, Inc. and its wholly owned subsidiaries (collectively “Rover” or the “Company”) is headquartered in Seattle, Washington with U.S. offices in Spokane, Washington and San Antonio, Texas, and internationally in Barcelona, Spain. The Company provides an online marketplace and other related tools, support and services that pet parents and pet care providers can use to find, communicate with, and interact with each other. On July 30, 2021 (the “Closing Date” or “Closing”), Nebula Caravel Acquisition Corp. (“Caravel”) consummated the previously announced merger pursuant to a Business Combination Agreement and Plan of Merger, dated February 10, 2021 (the “Business Combination Agreement”), by and between Caravel, Fetch Merger Sub, Inc., a wholly owned subsidiary of Caravel (“Merger Sub”), and A Place for Rover, Inc. (hereinafter referred to as “Legacy Rover”). Pursuant to the terms of the Business Combination Agreement, Merger Sub merged with and into Legacy Rover, with Legacy Rover continuing as the surviving entity and as a wholly owned subsidiary of Caravel (together with the other transactions described in the Business Combination Agreement, the “Merger”). On the Closing Date, Caravel changed its name from Nebula Caravel Acquisition Corp. to “Rover Group, Inc.” Liquidity As of September 30, 2023, the balance of cash and cash equivalents, short term investments, and long term investments was $129.1 million, $74.8 million, and $26.9 million, respectively. The Company has historically incurred losses from operations and had an accumulated deficit of $377.0 million as of September 30, 2023. The Company has primarily funded its operations with proceeds from the issuance of redeemable convertible preferred stock, common stock and other equity transactions, proceeds from the Merger, and debt borrowings. As the Company invests in expansion activities, we may continue to experience operating losses. Management believes that the Company’s current cash and cash equivalents and investments will be sufficient to fund its operations for at least the next 12 months from the issuance of these condensed consolidated financial statements. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Principles of Consolidation and Basis of Presentation The unaudited condensed consolidated financial statements and accompanying notes include the accounts of the Company and its wholly owned subsidiaries, after elimination of all intercompany balances and transactions. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and the requirements of the U.S. Securities and Exchange Commission (the “SEC”) for interim financial information. Certain information and disclosures normally included in consolidated financial statements prepared in accordance with GAAP have been condensed or omitted. Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2022. The information as of December 31, 2022 included in the condensed consolidated balance sheets was derived from those audited financial statements. The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial information for the interim periods presented. The unaudited condensed consolidated results of operations for the interim period are not necessarily indicative of the results to be expected for the year ending December 31, 2023 or for any other future annual or interim period. Reclassifications Certain amounts previously presented for prior periods have been reclassified to conform to current presentation. These reclassifications did not affect assets, liabilities, net loss, cash flows or equity for the periods presented. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated balance sheets and the reported amounts of revenue and expenses during the reporting period. Significant items subject to such estimates and assumptions, include, but are not limited to, the capitalization and estimated useful life of the Company’s internal-use software development costs, estimates used in impairment tests, the assumptions used in the valuation of leases, legal contingencies, stock-based compensation expense, income taxes and non-income tax reserves, and certain deferred tax assets and tax liabilities. These estimates and assumptions are based on information available as of the date of the condensed consolidated financial statements; therefore, actual results could differ from management’s estimates. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. The Company adjusts such estimates and assumptions when facts and circumstances dictate. Changes in those estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future periods. As future events and their effects cannot be determined with precision, actual results could materially differ from those estimates and assumptions. Segment Information The Company has one operating segment and one reportable segment. As the Company’s chief operating decision maker, the chief executive officer reviews financial information on a consolidated basis for purposes of allocating resources and evaluating financial performance. Substantially all long-lived assets are located in the United States. Substantially all revenue is based in the United States, and no individual foreign country represents 10% or more of the Company’s revenue. Foreign Currencies Foreign currency transaction gains and losses are a result of the effect of exchange rate changes on transactions denominated in currencies other than the functional currency. Gains and losses on those foreign currency transactions are included in determining net loss for the period of exchange and are recorded in other income (expense), net in the condensed consolidated statements of operations. The net effect of foreign currency was a $0.6 million and $0.2 million loss during the three and nine months ended September 30, 2023, respectively, and a $0.2 million and $1.0 million loss during the three and nine months ended September 30, 2022, respectively. Certain Significant Risks and Uncertainties The Company is subject to certain risks and challenges associated with other companies at a similar stage of development, including risks associated with: dependence on key personnel; marketing; adaptation to changing market dynamics and customer preferences; and potential competition including from larger companies that may have greater name recognition, longer operating histories, more and better established customer relationships and greater resources than the Company. The Company’s ability to provide a reliable platform largely depends on the efficient and consistent operation of its technology information systems and those of its third-party service providers. Any significant interruptions could harm the Company’s business and reputation and result in a loss of business. To management’s knowledge, no interruptions, attacks or breaches have, individually, or in the aggregate, resulted in any material liability to the Company, any material damage to the Company’s reputation, or any material disruption to the Company’s business. Concentrations of Credit Risk Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of cash, investments and accounts receivable. The Company maintains cash balances that exceed, and may in the future exceed, the insured limits set by the Federal Deposit Insurance Corporation. The Company has not experienced any losses on its deposits of cash and cash equivalents. The Company reduces credit risk by placing cash and investment balances with major financial institutions that management assesses to be of high-credit quality and also limits purchases of debt securities to investment-grade securities. The Company regularly evaluates the credit rating for issuers of government and corporate debt securities that it holds and other non-financial third party institutions. For the three and nine months ended September 30, 2023 and 2022, no individual pet care provider, pet parent, or affiliate represented 10% or more of the Company’s revenue. As of September 30, 2023 and December 31, 2022, accounts receivable was $76.5 million and $53.2 million, respectively, and was inclusive of $73.9 million and $51.1 million, respectively, which was due from payment processors who collected payment from pet parents on behalf of the Company. As of September 30, 2023 and December 31, 2022, the accounts receivable balance was also inclusive of $2.0 million and $1.4 million, respectively, which was due from arrangements with third parties, in which these third parties reimburse the Company for credits issued to pet parents. The Company’s receivables are short-term in nature and the Company’s historical experience of losses has not been material. Revenue Recognition Marketplace Platform Revenue The Company operates an online marketplace that provides a platform for pet parents and pet care providers to communicate and arrange for pet care services. The Company derives substantially all, or approximately 90% or more, of its revenue from pet parents’ and pet care providers’ use of the Company’s platform and related services that enable pet care providers to offer, book, and fulfill pet care services. The Company enters into its standard terms of service with pet care providers and pet parents who wish to use the Company’s platform. The terms of service define the rights and responsibilities of pet care providers and pet parents when using the Company’s platform as well as general payment terms. The Company charges a fixed percentage service fee for each arrangement of pet care services between the pet parent and the pet care provider on the Company’s platform (a booking) and do not vary based on the volume of transactions. A booking defines the explicit fee from which the Company earns its fixed percentage service fee. The creation of a booking combined with the terms of service establish enforceable rights and obligations for the transaction. A contract exists between the pet care provider and the Company upon the creation of a booking and after the pet care providers’ cancellation period has lapsed. Pet care providers are considered the Company’s customers to the extent that they pay a fixed percentage fee, generally up to a fixed dollar amount, to the Company for the booking. Similarly, pet parents are considered the Company’s customers and a contract exists between the pet parent and the Company upon the creation of a booking and after the pet care providers’ stated cancellation period has lapsed. Pet parents pay for services at the time of booking. The Company considers the facilitation of the connection between pet care provider and pet parent to be the promise in the contracts. This is consistent with the terms of service, as well as the substance of what a pet care provider or pet parent is expecting from the use of the Company’s platform. While customers have access to the use of the platform, customer support, and other activities, these activities are not considered distinct from each other in the context of the overall arrangement, which is the facilitation of a connection between a pet care provider and a pet parent. As such, the Company has determined that its sole performance obligation is to facilitate a connection between pet care providers and pet parents through its platform. The Company’s performance obligation is satisfied at a point-in-time when the connection has been completed, which is when the pet care provider and pet parent have completed a booking, any related cancellation period has lapsed, and the related underlying pet care services have begun. The Company derives revenue from pet care providers and pet parents primarily in the United States, as well as Canada, the United Kingdom and Western Europe. Judgment is required in determining whether the Company is the principal or agent in transactions with pet care providers and pet parents. The Company evaluates the presentation of revenue on a gross or net basis based on whether it controls the service provided to the pet parent and is therefore the principal, or the Company arranges for other parties to provide the service to the pet parent and is therefore the agent. The Company has concluded it is the agent in transactions with pet care providers and pet parents because, among other factors, it is not responsible for the delivery of pet care services provided by the pet care provider to the pet parent. Accordingly, the Company recognizes revenue on a net basis, representing the fee the Company expects to receive in exchange for providing access to the Company’s platform to pet care providers and pet parents. The Company has no significant financing components in its contracts with customers. The Company recognizes revenue net of any sales tax paid related to its revenue transactions. Provider Onboarding Revenue The Company earns revenue from non-refundable provider onboarding fees by completing quality assurance reviews of new pet care provider profiles including obtaining background checks, which are performed by a third party. Pet care providers pay the onboarding fee at the time of sign up. The Company recognizes revenue related to provider onboarding services at a point-in-time upon satisfaction of the related performance obligation, determined to be the completion of the quality assurance review of the pet care provider’s profile including a background check. The Company is considered to be a principal in these transactions and recognizes revenue on a gross basis. Costs associated with performing the pet care provider onboarding review are recognized in cost of revenue (exclusive of depreciation and amortization shown separately). Payments to Customers From time to time, the Company makes payments to pet parents and pet care providers as part of its marketing promotions, incentive programs and refund activities. Marketing Promotions and Incentive Programs The Company encourages the use of its platform and attracts new customers through its marketing promotions and incentive programs. The Company uses marketing promotions in tandem with sales and marketing spend to attract new pet parents to its platform. Promotions offered to pet parents in the form of credits, coupons or discounts are recorded as a reduction of revenue or included in marketing expense. The Company offers referral credits to its existing pet parents or pet care providers for referrals of new pet parents or pet care providers. These referral credits are paid in exchange for a distinct marketing service and therefore the portion of these credits that is equal to or less than the cost of acquiring a new pet parent or pet care provider are accounted for as a customer acquisition cost. These new customer acquisition costs are expensed as incurred and reflected as marketing expenses in the Company’s condensed consolidated statements of operations. The portion of these credits in excess of the fair value of acquiring a new pet parent or pet care provider is accounted for as a reduction of revenue. On occasion, the Company offers promotional discounts to existing pet parents. The Company records incentives provided to existing pet parents as a promotion and reduces revenue on the date that the corresponding revenue transaction is recorded. Refunds In certain instances, the Company issues refunds to pet parents as part of its customer support activities for customer satisfaction matters in the form of credits to be applied toward a future booking. The Company accounts for such refunds as variable consideration and therefore records the amount of each refund or credit issued as a reduction of revenue. Pet Parent Deposits and Pet Care Provider Liabilities The Company records payments received from pet parents, excluding the revenue portion due to the Company, in advance of the related services being provided as pet parent deposits. As the related performance obligations are satisfied, these amounts are settled through our payment processor and derecognized. In addition, we hold pet care provider liabilities relating to bookings completed prior to the implementation of our current payment processor and related systems where payment has not yet been requested by the pet care provider. The Company is subject to compliance with escheat laws applicable by jurisdiction where pet care providers do not claim the amounts owed to them for services rendered. Rover Guarantee In connection with services provided to facilitate the connections between pet care provider and pet parent, the Company provides a contractual guarantee to reimburse pet parents or pet care providers for certain expenses arising from injuries or other damages incurred during a service booked through the Company’s platform, subject to specified conditions (the “Rover Guarantee”). The Company’s obligation under the Rover Guarantee is accounted for in accordance with Accounting Standards Codification (“ASC”) 460, Guarantees . As a result, the Company estimates the fair value of the liability incurred in connection with providing the Rover Guarantee and records such amounts in accrued expenses and other current liabilities within the Company’s condensed consolidated balance sheets. Marketing Advertising expenses were $9.7 million and $27.4 million during the three and nine months ended September 30, 2023, respectively, and $6.3 million and $20.4 million during the three and nine months ended September 30, 2022, respectively. Goodwill Goodwill represents the excess of the aggregate fair value of the consideration transferred in a business combination over the fair value of the assets acquired, net of liabilities assumed. Goodwill is not amortized, but is subject to an annual impairment test. The Company performs its annual goodwill impairment test as of October 31, or more frequently if events or changes in circumstances indicate that the goodwill may be impaired. Management determined that the Company has two reporting units for which goodwill has been assigned for the evaluation of goodwill impairment, the Rover and GoodPup component business units. Events or changes in circumstances which could trigger an impairment review include significant changes in the manner of the Company’s use of the acquired assets or the strategy for the Company’s overall business, significant negative industry or economic trends, significant underperformance relative to historical or projected future results of operations, a significant adverse change in the business climate, cost factors that have a negative effect on earnings and cash flows, an adverse action or assessment by a regulator, estimated per share fair value of common stock, unanticipated competition or a loss of key personnel. The Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more-likely-than-not that the fair value of the reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, the Company determines it is not more-likely-than-not that the fair value of the reporting unit is less than its carrying amount, then additional impairment testing is not required. However, if the Company concludes otherwise, then it is required to perform a quantitative assessment for impairment. The quantitative assessment involves comparing the estimated fair value of each reporting unit with its respective book value, including goodwill. If the estimated fair value exceeds book value, goodwill is considered not to be impaired and no additional steps are necessary. If, however, the book value exceeds the fair value, an impairment loss is recognized in an amount equal to the excess, not to exceed the total amount of goodwill allocated to that reporting unit. See Note 2—Summary of Significant Accounting Policies — Interim Impairment Assessment for additional information regarding the interim impairment assessment. Intangible Assets Intangible assets are amortized over the estimated useful life of the assets. Amortization of intangible assets associated with or used in the services provided by the Company from which it generates revenue are classified within cost of revenue (exclusive of depreciation and amortization shown separately) in the Company’s statements of operations. Amortization of intangible assets not associated with or used in the services provided by the Company from which it generates revenue are classified within depreciation and amortization expense within the Company’s statements of operations. For the periods presented, amortization of the Company’s capitalized internal-use software costs related to its online platform has been included within cost of revenues. For the periods presented, amortization expense related to other intangible assets have been classified within depreciation and amortization within the Company’s statement of operations. See Note 2—Summary of Significant Accounting Policies— Interim Impairment Assessment for additional information regarding the interim impairment assessment. The Company identified certain intangible assets, consisting of technology and tradenames, as defensive assets. These are assets that the Company acquired but does not intend to actively use. Rather, the Company intends to hold the assets to prevent others from obtaining access to the assets. Interim Impairment Assessment During the quarter ended June 30, 2023, management identified various qualitative factors such as downward revisions to business forecasts and trends of adverse macroeconomic conditions on the GoodPup business performance that collectively indicated it is more-likely-than-not that the goodwill and intangible assets of the GoodPup reporting unit and asset group fair values were less than their carrying amounts as of June 30, 2023. It had previously been determined by the Company that GoodPup’s reporting unit and the asset group for assessing impairment of long-lived assets are the same. As a result, the Company performed an interim quantitative impairment assessment for goodwill in accordance with ASC 350, Intangibles— Goodwill and Other, and intangible assets in accordance with ASC 360, Property, Plant, and Equipment . The June 30, 2023 quantitative impairment tests indicated a decline in the fair value of the GoodPup reporting unit and asset group, resulting in a non-cash impairment charge of $6.9 million to write off goodwill and intangible assets in full. Impairment charges are included in impairment loss on intangible assets and goodwill in the condensed consolidated statements of operations. The Company’s remaining goodwill and intangible asset balance as of September 30, 2023 relates to the Company’s prior acquisitions within the Rover reporting unit, for which the Company concluded it was not more-likely-than-not that fair values were less than carrying amounts at September 30, 2023. The Company estimated the fair value of the GoodPup asset group and reporting unit using the income approach. Such fair value measurements are based predominately on Level 3 inputs. Inherent in the Company’s development of cash flow projections are assumptions and estimates derived from a review of our operating results, business plan forecasts, expected growth rates, and cost of capital, similar to those a market participant would use to assess fair value. Management also makes certain assumptions about future economic conditions and other data. Many of these factors used in assessing fair value are outside the control of management. Restricted Cash The Company classifies any cash balances that are restricted as to withdrawal or usage as restricted cash on the condensed consolidated balance sheets. In connection with the Company’s noncancellable Seattle headquarters lease agreement, which expires in 2030, the Company is required to hold a $3.7 million collateral account to secure the associated $3.5 million letter of credit, which is reflected in the restricted cash balance as of September 30, 2023, and for the duration of the lease. Upon the expiration of the lease agreement, the restriction will be lifted and the amounts will return for the general usage of the Company. See Note 9—Commitments and Contingencies for more information regarding the Company’s letters of credit. Net Income (Loss) Per Share Attributable to Common Stockholders The Company calculates basic and diluted net income (loss) per share attributable to common stockholders in conformity with the two-class method required for participating securities. The two-class method requires income available to common stockholders for the period to be allocated between common stock and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. Basic net income (loss) per share is calculated by dividing net income (loss) attributable to common stockholders by the weighted-average number of common stock outstanding for the periods presented, without consideration for potentially dilutive securities. Diluted net income (loss) per share is calculated by giving effect to all potential weighted average dilutive common stock. The dilutive effect of outstanding awards and convertible securities is reflected in diluted net income (loss) per share by application of the treasury stock method or if-converted method, as applicable. Recently Adopted Accounting Pronouncements The Company is provided the option to adopt new or revised accounting guidance as an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”) either (1) within the same periods as those otherwise applicable to public business entities, or (2) within the same time periods as private companies, including early adoption when permissible. The Company has elected to adopt new or revised accounting guidance within the same time period as public business entities, as indicated below. In March 2022, the FASB issued ASU No. 2022-02 Financial Instruments—Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. The amendment in this ASU provides an update to: (1) troubled debt restructurings guidance in Subtopic 310-40 and enhances disclosure requirements for certain loan refinancings and restructurings; and (2) requires public entities to disclose current period gross write-offs by year of origination for financing receivables and net investments in leases. The guidance is effective for the Company for the year beginning after December 15, 2022. The Company adopted this standard on January 1, 2023 using the prospective transition method. The adoption of the new standard did not have a material impact on the Company’s condensed consolidated financial statements. Recently Issued Accounting Pronouncements In June 2022, the FASB issued ASU No. 2022-03 Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restriction. The amendment in this ASU clarifies that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. This amendment also requires public entities to add certain disclosures for equity securities subject to contractual sale restrictions. The guidance is effective for the Company for the year beginning after December 15, 2023. The Company will adopt this standard on January 1, 2024 using the prospective transition method. The Company does not expect the adoption of the new standard to have a material impact on the Company’s condensed consolidated financial statements but will continue to evaluate the new standard in future accounting periods. |
Business Combinations
Business Combinations | 9 Months Ended |
Sep. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations | Business Combinations On June 15, 2022, the Company acquired all issued and outstanding stock of GoodPup, an early-stage company that operates a virtual dog training platform. The transaction was accounted for as a business combination. The total purchase price for this acquisition of $7.4 million included a $1.6 million holdback for indemnity and subsequent adjustments that is expected to be paid within the 18-month holdback period. The purchase price was provisionally allocated as follows: $4.4 million to intangible assets (see Note 8—Goodwill and Intangible Assets for more information), ($1.0) million to net assets and liabilities assumed based on their estimated fair value on the acquisition date, and the remaining $4.0 million to goodwill. The goodwill from the acquisition was mainly attributable to expected synergies and other benefits. The goodwill was not tax deductible. The intangible assets were amortized on a straight-line basis over their estimated useful lives of three During the fourth quarter of 2022, the Company obtained additional information during the measurement period that existed as of the acquisition date and recorded adjustments to the preliminary purchase price allocation that resulted in a decrease of $0.2 million to goodwill, $0.1 million to net liabilities assumed, and $0.1 million to the holdback liability. The adjustment did not have a material impact on the Company’s consolidated statements of operations. Certain employees hired in conjunction with the acquisition received restricted stock unit awards and retention bonuses that are subject to service conditions. The Company accounted for these awards and bonuses as a post-business combination expense. The Company incurred no acquisition-related costs during the three and nine months ended September 30, 2023. The Company incurred no acquisition-related costs during the three months ended September 30, 2022 and $0.4 million in acquisition-related costs during the nine months ended September 30, 2022, which were included in general and administrative expenses in the consolidated statement of operations. The results of operations for this acquisition have been included in the Company’s consolidated statements of operations since the date of acquisition. Actual and pro forma revenue and results of operations for the acquisition have not been presented because they did not have a material impact on the consolidated results of operations. During the second quarter of 2023, the Company recorded a non-cash impairment charge related to GoodPup of $6.9 million to write off goodwill and intangible assets in full. There were no other non-cash impairment charges for the three and nine months ended September 30, 2023 and 2022. See Note 2—Summary of Significant Accounting Policies — Interim Impairment Assessment and Note 8— Goodwill and Intangible Assets for more information. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Contract Balances Contract liability balances on the Company’s condensed consolidated balance sheets consist of deferred revenue for amounts collected upon the completion of a booking. Deferred revenue is limited to the amount which the Company expects to recognize as revenue and the amounts expected to be paid out to pet care providers are separately presented as pet parent deposits on the Company’s condensed consolidated balance sheets, as those amounts will not result in revenue recognized. The deferred revenue balance is reduced by the amount of credits, coupons, or discounts to the extent that they are expected to reduce the revenue recognized upon satisfaction of the performance obligation. Substantially all of the deferred revenue as of September 30, 2023 relates to bookings that begin within the next twelve months, at which time revenue will be recognized, unless the booking is canceled during the pet care provider’s cancellation period. The changes in the Company’s deferred revenue balances were as follows (in thousands): Balance at June 30, 2023 $ 16,390 Bookings and other 62,858 Revenue recognized (66,136) Balance at September 30, 2023 $ 13,112 Balance at December 31, 2022 $ 5,544 Bookings and other 174,150 Revenue recognized (166,582) Balance at September 30, 2023 $ 13,112 Substantially all deferred revenue as of June 30, 2023 and December 31, 2022 was recognized as revenue during the three and nine months ended September 30, 2023, respectively. |
Investments
Investments | 9 Months Ended |
Sep. 30, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments The Company’s investments include available-for-sale investments, convertible notes, and equity investments without a readily determinable fair value. Available-for-sale investments consist of marketable securities that are accounted for at fair value. Premiums and discounts paid on securities at the time of purchase are amortized over the period of maturity. The amortized cost and fair value of the investments and unrealized gains and losses were as follows (in thousands): September 30, 2023 Amortized Costs Gross Unrealized Gains Gross Unrealized Losses Fair Value Marketable securities: Commercial paper $ 8,020 $ — $ (5) $ 8,015 Corporate securities 36,207 — (37) 36,170 US Government securities 42,427 — (121) 42,306 Asset-backed securities 4,746 — (7) 4,739 Agency bonds 9,205 — (16) 9,189 Certificate of deposit 1,321 — — 1,321 Total marketable securities 101,926 — (186) 101,740 Total investments $ 101,926 $ — $ (186) $ 101,740 December 31, 2022 Amortized Costs Gross Unrealized Gains Gross Unrealized Losses Fair Value Marketable securities: Commercial paper $ 54,851 $ — $ (51) $ 54,800 Corporate securities 38,260 — (220) 38,040 US Government securities 108,551 — (792) 107,759 Asset-backed securities 8,269 — (35) 8,234 Agency bonds 4,989 — (12) 4,977 Total marketable securities 214,920 — (1,110) 213,810 Other investments: Convertible notes 1,810 — — 1,810 Total other investments 1,810 — — 1,810 Total investments $ 216,730 $ — $ (1,110) $ 215,620 Unrealized losses of the Company’s available-for-sale securities that have been in a continuous unrealized loss position for twelve months or longer were immaterial as of September 30, 2023 and December 31, 2022. The contractual maturity of the available-for-sale investments were as follows (in thousands): September 30, 2023 Within 1 year 1 to 5 years More than 5 years Total Marketable securities: Commercial paper $ 8,015 $ — $ — $ 8,015 Corporate securities 13,419 22,751 — 36,170 US Government securities 42,306 — — 42,306 Asset-backed securities 572 4,167 — 4,739 Agency bonds 9,189 — — 9,189 Certificate of deposit 1,321 — — 1,321 Total marketable securities 74,822 26,918 — 101,740 Total investments $ 74,822 $ 26,918 $ — $ 101,740 December 31, 2022 Within 1 year 1 to 5 years More than 5 years Total Marketable securities: Commercial paper $ 54,800 $ — $ — $ 54,800 Corporate securities 32,767 5,273 — 38,040 US Government securities 101,289 6,470 — 107,759 Asset-backed securities — 8,234 — 8,234 Agency bonds 2,491 2,486 — 4,977 Total marketable securities 191,347 22,463 — 213,810 Other investments: Convertible notes 1,810 — — 1,810 Total other investments 1,810 — — 1,810 Total investments $ 193,157 $ 22,463 $ — $ 215,620 The Company believes there were no fundamental issues such as credit losses or other factors with respect to any of its available-for-sale securities for both the three and nine months ended September 30, 2023 and 2022. The unrealized losses on investments in fixed-maturity securities were caused primarily by interest rate changes. It is expected that the securities would not be settled at a price less than par value of the investments. Because the declines in fair value are attributable to changes in interest rates or market conditions and not credit quality, and because the Company has the ability to hold its available-for-sale investments until a market price recovery or maturity, the Company has not recognized any credit loss reserves as of September 30, 2023 and December 31, 2022. Equity investments without a readily determinable fair value consist of equity securities that are accounted for at cost, with adjustments for observable changes in prices or impairments, and are classified within the caption investment in equity securities in related parties in the condensed consolidated balance sheet with any adjustments recognized as a component of change in fair value of other investments in the condensed consolidated statements of operations. As of September 30, 2023, these investments had a carrying value of $3.8 million. The Company did not hold any equity investments without a readily determinable fair value as of December 31, 2022. Each reporting period, the Company performs a qualitative assessment to evaluate whether the investment is impaired. This assessment includes a review of recent operating results and trends, recent sales/acquisitions of the investee securities, and other publicly available data. If the investment is impaired, the Company would write it down to its estimated fair value. The Company did not recognize any impairments to equity investments during the three and nine months ended September 30, 2023. Other Investments Convertible Notes and Equity Investments (Related Party Transaction) In July 2022, the Company entered into transaction agreements with Pioneer Square Labs (“PSL”) and entities affiliated with PSL, a start-up studio and venture capital fund of which one of the Company’s directors, Greg Gottesman, is a managing director and co-founder. The Company with PSL co-invested in an early-stage company that provides a service for pet parents that is complementary to the Company’s current offerings (the “Investee”). The Company contributed intellectual property in the form of a nonexclusive license agreement in exchange for 5,000,000 shares of common stock, which represents 15% of the Investee’s diluted outstanding equity as of September 30, 2023. The Company accounts for this investment under the equity method as it has significant influence over the Investee but does not hold a controlling financial interest. In July 2022, in conjunction with the agreements, the Company made an initial investment of $1.0 million in the Investee in the form of a convertible note, which had a maturity date of July 2023. Subsequently, the Company invested an additional $0.3 million and $0.5 million in the form of convertible notes during September 2022 and November 2022, respectively. As of November 2022, all investments in the form of convertible notes were amended to mature in November 2023. The convertible notes accrued interest at a rate of 5% per year and were payable upon the maturity dates. The Company elected to measure these convertible notes at fair value with changes in fair value reported in earnings. In June 2023, the Company converted the entire balance of its convertible note investments into 4,162,357 shares of Series Seed Preferred Stock of the Investee according to the terms of the notes’ conversion feature at a discounted conversion price of $0.4507 per share. The fair value of the convertible notes at the conversion date was determined to be equal to fair value of the shares of Series Seed Preferred Stock received upon conversion, which was $2.3 million. The adjusted carrying value of the investment was reclassified from notes receivable from related parties to investment in equity securities in related parties in the condensed consolidated balance sheets as a result of the conversion. The Company recognized total fair value adjustments of $0.0 million and $1.1 million within change in fair value of other investments on the condensed consolidated statements of operations for the three and nine months ended September 30, 2023, respectively. No incremental fair value adjustment was recorded for the three and nine months ended September 30, 2022. There were no impairment charges for the three and nine months ended September 30, 2023 and 2022. See Note 6—Fair Value for more information on the fair value of the convertible notes. In June 2023, simultaneous to the note conversion the Company also invested an additional $1.5 million in the Investee in exchange for 2,662,406 shares of Series Seed Preferred Stock at a price of $0.5634 per share. As of September 30, 2023 the carrying value of the Company’s aggregate Series Seed Preferred Stock investment was $3.8 million, as recorded in investment in equity securities in related parties within the condensed consolidated balance sheets. As the Company’s basis in the Investee’s common stock as accounted for under the equity method was valued at zero, the Company’s proportionate share of losses resulted in a reduction to the carrying value of the convertible note investments prior to the conversion event as well as a reduction to the carrying value of the Series Seed Preferred Stock investment subsequent to the conversion event. For the three |
Fair Value
Fair Value | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value The following table presents the placement in the fair value hierarchy of assets and liabilities that are measured at fair value on a recurring basis (in thousands): September 30, 2023 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 17,800 $ — $ — $ 17,800 US Government securities — 6,969 — 6,969 Investments: Commercial paper — 8,015 — 8,015 Corporate securities — 36,170 — 36,170 US Government securities — 42,306 — 42,306 Asset-backed securities — 4,739 — 4,739 Agency bonds — 9,189 — 9,189 Certificate of deposit — 1,321 — 1,321 Total assets measured at fair value $ 17,800 $ 108,709 $ — $ 126,509 December 31, 2022 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 23,006 $ — $ — $ 23,006 Commercial paper — 7,954 — 7,954 Investments: Commercial paper — 54,800 — 54,800 Corporate securities — 38,040 — 38,040 US Government securities — 107,759 — 107,759 Asset-backed securities — 8,234 — 8,234 Agency bonds — 4,977 — 4,977 Other investments: Convertible notes — — 1,810 1,810 Total assets measured at fair value $ 23,006 $ 221,764 $ 1,810 $ 246,580 The following table provides a reconciliation of the beginning and ending balances for the Level 3 financial assets measured at fair value using significant unobservable inputs (in thousands): Convertible Notes Balance at December 31, 2022 $ 1,810 Additions during the period — Proportionate share of equity method losses (266) Incremental change in fair value 801 Conversion into investment in equity securities in related party (2,345) Balance at September 30, 2023 $ — The Company recognizes transfers between levels within the fair value hierarchy, if any, at the end of each period. There were no transfers of financial instruments between valuation levels during the periods presented. The Company classifies financial instruments as Level 2 within the fair value hierarchy which are valued on the basis of prices from an orderly transaction between market participants provided by reputable dealers or pricing services. Prices of these securities are obtained through independent, third-party pricing services and include market quotations that may include both observable and unobservable inputs. In determining the value of a particular investment, pricing services may use certain information with respect to transactions in such investments, quotations from dealers, pricing matrices and market transactions in comparable investments and various relationships between investments. The Company classifies financial instruments in Level 3 of the fair value hierarchy when there is reliance on at least one significant unobservable input to the valuation model. In addition to these unobservable inputs, the valuation models for Level 3 financial instruments typically also rely on a number of inputs that are readily observable, either directly or indirectly. The Company’s assessment of a particular input to the fair value measurement requires management to make judgments and consider factors specific to the liability. The fair value hierarchy requires the use of observable market data when available in determining fair value. The Company recognizes transfers between levels within the fair value hierarchy, if any, at the end of each period. Valuation of Convertible Note Investments As described in Note 5—Investments—Other Investments— Convertible Notes and Equity Investments (Related Party Transaction ) , the Company previously held convertible note investments in the Investee that were measured at fair value. As of December 31, 2022, these convertible notes were held at a fair value of $1.8 million. In June 2023, the convertible note investments converted into shares of Series Seed Preferred Stock and the Company no longer held a convertible note investment as of September 30, 2023. The fair value of the notes was based predominantly on the credit quality of the underlying business and its ability to repay principal and interest, as well as the potential outcome of future equity financing transactions that may trigger the conversion feature provided by the notes. The fair value of the convertible notes at the conversion date was determined to be equal to fair value of the shares of Series Seed Preferred Stock received upon conversion, which was $2.3 million. Valuation of Private Placement Warrant Derivative Liability In December 2021, the Company announced that, pursuant to the terms of the Warrant Agreement, it would redeem all of the outstanding private placement warrants (“Private Warrants”) held by Nebula Caravel Holdings, LLC, the sponsor of Caravel and a greater than five percent stockholder of the Company (the “Sponsor”), and public warrants (“Public Warrants” and, collectively with the Private Warrants, “Warrants”) that remained outstanding at 5:00 p.m. New York City time on January 12, 2022 (the “Redemption Date”). In January 2022, the Company issued 2,046,220 shares of the Company’s Class A common stock, par value $0.0001 per share (“Class A Common Stock”), related to the December 2021 and January 2022 cashless exercise of 5,425,349 Public Warrants and 2,574,164 Private Warrants, representing approximately 98.6% of the Public Warrants and 100% of the Private Warrants, respectively. Holders of Warrants received 0.2558 shares of Class A Common Stock per Warrant in lieu of receiving a redemption price of $0.10 per Warrant (the “Redemption Price”) . A total of 74,631 Public Warrants remained unexercised after the Redemption Date and broker protect period and the Company redeemed those unexercised Public Warrants. Pursuant to the redemption, the Public Warrants ceased trading on The Nasdaq Global Market effective as of the close of trading on the Redemption Date, and were delisted after market close on the Redemption Date. As of September 30, 2023, no warrant liabilities were outstanding a s |
Balance Sheet Components
Balance Sheet Components | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Balance Sheet Components | Balance Sheet Components Property and Equipment, net The following table presents the detail of property and equipment, net as follows (in thousands): September 30, December 31, Computers $ 1,547 $ 1,452 Furniture and fixtures 3,799 3,777 Leasehold improvements 13,479 13,808 Internal-use software 24,485 21,652 Asset retirement obligation 225 225 Total property and equipment 43,535 40,914 Less: Accumulated depreciation and amortization (24,274) (21,396) Total property and equipment, net $ 19,261 $ 19,518 Depreciation and amortization of property and equipment was $1.0 million and $3.0 million during the three and nine months ended September 30, 2023, respectively, and $1.0 million and $2.9 million during the three and nine months ended September 30, 2022, respectively. Depreciation and amortization of property and equipment was recorded to depreciation and amortization in the condensed consolidated statements of operations. The Company capitalized $2.6 million and $7.7 million of software development costs for the three and nine months ended September 30, 2023, respectively, and $2.4 million and $6.5 million for the three and nine months ended September 30, 2022. Internal-use software amortization was $1.9 million and $5.4 million during the three and nine months ended September 30, 2023, respectively, and $1.7 million and $5.2 million during the three and nine months ended September 30, 2022, respectively. Internal-use software amortization was recorded to cost of revenue (exclusive of depreciation and amortization shown separately) in the condensed consolidated statements of operations. Accrued Expenses and Other Current Liabilities The following table presents the detail of accrued expenses and other current liabilities as follows (in thousands): September 30, December 31, Income and other tax liabilities $ 2,101 $ 1,670 Accrued legal expenses and open claims 917 686 Accrued legal settlements (1) — 18,000 Accrued professional services 696 435 Holdback related to business combination 1,343 1,343 Accrued share repurchase 553 — Coupon liabilities 317 205 Other current liabilities 564 355 Total accrued expenses and other current liabilities $ 6,491 $ 22,694 __________________ (1) See Note 9—Commitments and Contingencies for more information. Employee Retention Credit The employee retention credit (“ERC”), as originally enacted through the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) on March 27, 2020, is a refundable tax credit against certain employment taxes equal to 50% of the qualified wages an eligible employer paid to employees from March 17, 2020 to December 31, 2020. The Disaster Tax Relief Act, enacted on December 27, 2020, extended the ERC for qualified wages paid from January 1, 2021 to June 30, 2021, and the credit was increased to 70% of qualified wages an eligible employer paid to employees during the extended period. The American Rescue Plan Act of 2021, enacted on March 11, 2021, further extended the ERC through December 31, 2021. In the second quarter 2022, the Company filed an application with the U.S. Internal Revenue Service (“IRS”) for the ERC. Employers are eligible for the credit if they experienced full or partial suspension or modification of operations during any calendar quarter because of governmental orders due to the COVID-19 pandemic or a significant decline in gross receipts based on a comparison of quarterly revenue results for 2020 and/or 2021 with the comparable quarter in 2019. The Company’s ERC application was equal to 70% of qualified wages paid to employees during the period from January 1, 2021 to June 30, 2021 for a maximum quarterly credit of $7,000 per employee. On July 3, 2023, the Company recorded other income of $1.9 million related to the realization of the credit in the second quarter 2023. Consulting fees associated with the ERC application were immaterial. The Company’s eligibility remains subject to audit by the IRS for a period of five years. The Company accounted for the ERC by analogy to ASC 450-30, Gain Contingencies and ASC 855, Subsequent Events . As the notice of refund and receipt of cash from the IRS was received on July 3, 2023, the Company determined the notice of refund affected the realization of the anticipated ERC and therefore, the ERC was recognized as a receivable as of the balance sheet date. The Company recorded the $1.9 million ERC in the second quarter of 2023 within prepaid expenses and other current assets in the condensed consolidated balance sheets and within other income (expense), net on the condensed consolidated statements of operations. The Company has not recorded additional calculated quarterly credits as income as of September 30, 2023 because it is not reasonably certain further amounts will be collected due to the delayed processing and enhanced scrutiny of applications submitted before September 14, 2023 as announced by the IRS in September 2023. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill The following table summarizes the changes in the carrying amount of goodwill (in thousands): Balance at December 31, 2022 $ 36,915 GoodPup Impairment (3,756) Balance at September 30, 2023 $ 33,159 During the second quarter of 2023, the Company recorded a non-cash impairment charges of $3.8 million to write off goodwill in full for the GoodPup reporting unit. Impairment charges were included in impairment loss on intangible assets and goodwill in the condensed consolidated statements of operations. See Note 2—Summary of Significant Accounting Policies — Interim Impairment Assessment for more information. Intangible Assets The gross book value, accumulated amortization, and impairment of intangible assets were as follows (in thousands): September 30, 2023 Gross Book Accumulated Impairment Net Book Pet parent relationships $ 6,600 $ (4,089) $ — $ 2,511 Shelter relationships 776 (155) (621) — Technologies 1,696 (565) (1,131) — Tradenames 1,302 (260) (1,042) — Training curriculum 551 (184) (367) — Total $ 10,925 $ (5,253) $ (3,161) $ 2,511 December 31, 2022 Gross Book Accumulated Impairment Net Book Pet parent relationships $ 6,600 $ (3,478) $ — $ 3,122 Shelter relationships 834 (135) — 699 Technologies 1,696 (283) — 1,413 Tradenames 1,302 (130) — 1,172 Training curriculum 551 (92) — 459 Total $ 10,983 $ (4,118) $ — $ 6,865 The weighted average amortization period remaining as of September 30, 2023 for each class of intangible assets were as follows (in years): Pet parent relationships 3.1 Amortization expense related to acquired intangible assets during the three and nine months ended September 30, 2023 was $0.2 million and $1.2 million, respectively, and $0.6 million and $1.5 million during the three and nine months ended September 30, 2022. During the second quarter of 2023, the Company recorded impairment charges of $3.2 million to write off intangible assets in full, related to acquired tradenames, shelter relationships, training curriculum and developed technology from the GoodPup asset group. Impairment charges are included in impairment loss on intangible assets and goodwill in the condensed consolidated statements of operations. See Note 2—Summary of Significant Accounting Policies — Interim Impairment Assessment for more information. Based on amounts recorded at September 30, 2023, the Company estimates intangible asset amortization expense in each of the years ending December 31 as follows (in thousands): Remainder of 2023 $ 204 2024 814 2025 814 2026 679 Thereafter — Total $ 2,511 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Leases The Company leases certain office space in Seattle and Spokane, Washington with lease agreements expiring between 2026 and 2030. These leases require monthly lease payments that may be subject to annual increases throughout the lease term. Certain of these leases also include renewal options at the election of the Company to renew or extend the lease for an additional one The Company also has coworking leases in Barcelona, Spain and San Antonio, Texas, which are included in short-term lease costs. In September 2018, the Company entered into a non-cancellable sublease agreement for a portion of one of its leased facilities that commenced on November 1, 2018, which was subsequently amended to extend the term for an additional two years in February 2020. In May 2022, the Company amended the sublease to extend the term for an additional one year. In December 2022, the Company amended the sublease to extend the term for one In April 2021, the Company entered into a non-cancellable sublease agreement for a portion of one of its leased facilities that commenced on September 1, 2021. As of September 30, 2023, under the terms of the amended sublease agreement, the Company will receive $0.5 million in base lease payments plus reimbursement of certain operating expenses over the remaining term of the sublease, which ends in August 2024. In October 2023, the Company amended the sublease to extend the term for one Sublease income is recognized on a straight-line basis over the sublease term and is recorded as a reduction to operating lease cost within general and administrative costs in the condensed consolidated statements of operations. The components of lease cost were as follows (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Operating lease cost $ 982 $ 1,054 $ 2,944 $ 3,178 Short-term lease cost 171 39 495 39 Sublease income (296) (297) (888) (903) Total lease cost $ 857 $ 796 $ 2,551 $ 2,314 Other information related to leases was as follows (in thousands): Nine Months Ended September 30, 2023 2022 Cash paid for operating lease liabilities $ 3,643 $ 3,471 Lease term and discount rate were as follows: As of September 30, 2023 As of December 31, 2022 Weighted-average discount rate 7.30 % 7.27 % Weighted-average remaining lease term (years) 6.11 6.82 Maturities of lease liabilities were as follows as of September 30, 2023 (in thousands): Year Ending December 31 Amounts Remainder of 2023 $ 759 2024 4,569 2025 4,693 2026 4,430 2027 4,353 Thereafter 9,430 Total lease payments 28,234 Less: imputed interest (5,678) Present value of lease liabilities 22,556 Less: current portion of lease liabilities (2,613) Total lease liabilities, noncurrent $ 19,943 Letters of Credit The Company maintains a $3.5 million secured letter of credit from a third-party financial institution related to the security deposit on its Seattle headquarters office space. The letter of credit is secured by a $3.7 million cash collateral account that is included as restricted cash on the condensed consolidated balance sheets. Additionally, the Company maintains a $0.1 million unsecured letter of credit from a third-party financial institution related to the security deposit on its Spokane office space. Guarantees and Indemnification In the ordinary course of business to facilitate sales of its services, the Company has entered into agreements with, among others, suppliers, and partners that include guarantees or indemnity provisions. The Company also enters into indemnification agreements with its officers and directors, and the Company’s certificate of incorporation and bylaws include similar indemnification obligations to its officers and directors. To date, there have been no claims under any indemnification provisions, therefore there is no accrual of such amounts for any of the periods presented. The Company is unable to determine the maximum potential impact of these indemnifications on the condensed consolidated financial statements and maintains director and officer insurance coverage that would generally enable it to recover a portion of any future amounts paid for director and officer indemnification obligations. Litigation and Other Contingencies From time to time, the Company is or may become party to litigation and subject to claims incurred in the ordinary course of business, including personal injury and indemnification claims, intellectual property claims, labor and employment claims, threatened claims, breach of contract claims, and other types of claims, class action and representative lawsuits, and actions brought by government authorities, alleging violations of employment classification laws, labor and other laws that would apply to employees, consumer protection laws, data protection laws, or other laws. In addition, in the ordinary course of business, the Company’s Trust and Safety team receives claims pursuant to the Rover Guarantee, as well as claims and threats of legal action that arise from pet care services booked through the Company’s website and/or applications. Various parties have from time to time claimed, and may claim in the future, that the Company is liable for damages related to accidents or other incidents involving pets, pet parents, pet care providers, and third parties. The Company regularly evaluates the status of legal proceedings and regulatory matters in which it is involved to assess whether a loss is probable or there is a reasonable possibility that a loss or additional loss may have been incurred to determine if accruals are appropriate. The Company accrues a liability when management believes information available prior to the issuance of the condensed consolidated financial statements indicates it is probable a loss has been incurred as of the date of the condensed consolidated financial statements and the amount of loss can be reasonably estimated. The Company adjusts its accruals to reflect the impact of negotiations, settlements, rulings, advice of legal counsel, and other information and events pertaining to a particular case. Legal costs are expensed as incurred. Although the results of litigation, claims and regulatory matters are inherently unpredictable, management concluded, based on currently available information, that other than with respect to the case discussed below there was not a reasonable possibility that the Company had incurred a material and estimable loss during the periods presented related to such loss contingencies. On August 22, 2018, a pet care provider filed a representative action under California’s Private Attorney General Act (“PAGA”) in California Superior Court, captioned Erika Miller v. A Place for Rover, Inc. , alleging that the Company misclassified pet care providers in California as independent contractors in violation of the California Labor Code, alleging various wage and hour claims under the California Labor Code, and seeking injunctive relief, civil penalties, attorney’s fees, and other forms of relief. After the Company successfully removed the case to the U.S. District Court for the Northern District of California (the “District Court”), a nother pet care provider was substituted as plaintiff in the case, subsequently captioned Melanie Sportsman v. A Place for Rover, Inc . On May 6, 2021, the District Court granted the Company’s motion for summary judgment and entered judgment in the Company’s favor, closing the case, but the plaintiff filed a notice of appeal of the District Court’s dismissal with the U.S. Court of Appeals for the Ninth Circuit (the “Ninth Circuit”). Following oral argument before the Ninth Circuit on August 29, 2022, the Company and the plaintiff engaged in settlement discussions and mediations resulting in a binding settlement term sheet between the Company and the named plaintiff on October 20, 2022. The Company recorded the $18.0 million total settlement payment provided for in the binding settlement term sheet under general and administrative expense in the condensed consolidated statements of operations for the three months ended September 30, 2022 and within accrued expenses and other current liabilities on the condensed consolidated balance sheets as of September 30, 2022. At the parties’ request, the Ninth Circuit dismissed the appeal without prejudice and remanded to the District Court for settlement approval, subject to reinstatement with the Ninth Circuit in the event the District Court declined to approve the settlement. On January 12, 2023, the Company and the named plaintiff entered into a comprehensive settlement agreement and release of claims pursuant to which the Company agreed to make the total settlement payment of $18.0 million, which included all related settlement costs, in full and final settlement of all claims that the named plaintiff and members of a proposed settlement class and a PAGA group brought or could have brought in the litigation, including claims under PAGA, the California Labor Code, and similar statutes through the District Court’s final order approving the settlement agreement. The settlement class consisted of all pet care providers who performed at least one service in California booked through the Rover platform during the period from November 1, 2018 through February 7, 2023, the date on which the motion for preliminary approval of the settlement was filed with the District Court. In addition, pet care providers who performed at least one service in California booked through the Rover platform between June 11, 2017 and February 7, 2023 received more limited relief related to PAGA included as part of the overall settlement. The Company also agreed to modify the Rover platform to make certain changes applicable to pet care providers in California to bolster the classification of pet care providers who use the Rover platform as independent contractors under California law. On July 24, 2023, the District Court issued its order granting final approval of the settlement agreement. The settlement subsequently became final as there were no appeals or requests for review filed within 31 days after the District Court’s order granting final approval. On September 1, 2023, the Company paid the remaining $17.9 million total settlement payment from cash and cash equivalents. In settling the case, the Company did not admit to any wrongdoing or liability. While litigation is inherently unpredictable and the ultimate outcomes cannot be predicted with certainty, the Company believes it has valid defenses with respect to the legal matters pending against it. Nevertheless, the Company’s condensed consolidated financial statements could be materially adversely affected in a particular period by the resolution of one or more of these contingencies. Accrued liabilities established to provide for contingencies are adjusted as further information develops, circumstances change, or contingencies are resolved; and such changes are recorded in the accompanying condensed consolidated statements of operations during the period of the change and reflected in accrued expenses and other current liabilities on the accompanying condensed consolidated balance sheets. Until the final resolution of legal matters, there may be an exposure to losses in excess of the amounts accrued. Regardless of the outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources, and other factors. The Company may also find itself at greater risk to outside party claims or regulatory actions as it increases and continues its operations in jurisdictions where the laws with respect to the potential liability of online marketplaces or the employment classification of pet care providers who use online marketplaces are uncertain, unfavorable or unclear. Additionally, from time to time, the Company has been or may become subject to audit by taxing authorities or subject to other forms of inspection or audit, including audits related to employment classification. Due to the uncertainties inherent in the final outcome of such matters, the Company can give no assurance that it will prevail in such matters which could have an adverse effect on the Company’s condensed consolidated financial statements. As of September 30, 2023, the Company was not aware of any currently pending legal matters or claims, individually or in the aggregate, that are expected to have a material adverse effect on its condensed consolidated financial statements. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Public and Private Warrants In January 2022, the Company issued Class A Common Stock related to the December 2021 and January 2022 cashless exercise of the Warrants. See Note 6—Fair Value for more information. The Warrants were classified as a liability prior to exercise and redemption and measured at fair value with the change in fair value reported in the statement of operations. Upon the cashless exercise of such Warrants to Class A Common Stock, the related carrying amount of the warrant liability was reclassified to stockholders’ equity. Share Repurchase Program In February 2023, the Company announced that its board of directors approved a 12-month share repurchase program with authorization to purchase up to $50.0 million (exclusive of brokers’ commissions and expenses) of the Class A Common Stock (the “Share Repurchase Program”). See Note 14—Subsequent Events for a discussion of the November 2023 extension of the Share Repurchase Program. Under the Share Repurchase Program, repurchases may be made on a discretionary basis from time to time, subject to general business and market conditions, through open market transactions (including through Rule 10b5-1 trading plans) or through privately negotiated transactions in accordance with applicable securities laws and other legal requirements, including the requirements of Rule 10b-18 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All shares repurchased under the Share Repurchase Program are retired and returned to authorized and unissued status. The repurchases are funded from existing cash and cash equivalents and investments. The Share Repurchase Program does not obligate us to repurchase any specific dollar amount or to acquire any specific number of shares. The Share Repurchase Program may be modified, suspended, or terminated at any time at the discretion of the Company’s board of directors. When shares are repurchased for retirement, the cost of the repurchased shares is deducted from stockholders’ equity, with their par value being deducted from common stock and the excess of the repurchase cost over the par value being deducted from accumulated deficit. The Company excludes shares repurchased but not yet settled from the calculation of basic and diluted earnings per share. The Inflation Reduction Act of 2022 imposed a nondeductible 1% excise tax on the net value of certain stock repurchases made after December 31, 2022. Excise tax accrued was $0.1 million and $0.2 million for the three and nine months ended September 30, 2023, respectively. The following table presents the open-market share purchase activity for the three and nine months ended September 30, 2023 and 2022, exclusive of brokers’ commissions and excise tax (in thousands, except share and per share data): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Total number of shares purchased 3,470,715 — 7,749,117 — Average price paid per share $ 5.88 $ — $ 5.16 $ — Total cost $ 20,400 $ — $ 39,981 $ — |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation 2021 Equity Incentive Plan The Company adopted the 2021 Equity Incentive Plan (the “2021 Plan”) under which 17.2 million shares of Class A Common Stock were initially reserved for issuance, plus up to 20.4 million shares subject to stock options that were assumed in the Merger and expire or otherwise terminate without having been exercised in full, are tendered to or withheld by the Company for payment of an exercise price or for tax withholding obligations, or are forfeited to or repurchased by the Company due to failure to vest. The 2021 Plan permits the grant of incentive and non-qualified stock options, restricted stock, restricted stock units and other stock-based awards to employees, directors, and consultants of the Company. As of September 30, 2023, the Company had 8.7 million shares of Class A Common Stock reserved for future issuance under the 2021 Plan, which includes shares subject to stock options that were assumed in the Merger that expired or otherwise terminated without having been exercised in full or were forfeited due to failure to vest. Equity Awards Available for Grant A summary of equity awards available for grant is as follows (in thousands): Equity Available Balances as of December 31, 2022 7,881 Equity awards authorized 9,226 Equity awards granted (10,239) Equity awards canceled and forfeited 871 Equity awards withheld under net share settlement 1,010 Balances as of September 30, 2023 8,749 Stock Options A summary of stock option activity is as follows (in thousands, except per share amounts and years): Number of Weighted- Weighted- Aggregate Balance as of December 31, 2022 14,363 $ 1.71 4.9 $ 28,251 Options exercised (1,960) 1.49 Options canceled and forfeited (287) 2.31 Balances as of September 30, 2023 12,116 $ 1.73 4.3 $ 54,894 Options vested and exercisable as of September 30, 2023 11,742 $ 1.72 4.2 $ 53,349 There were no options granted during the nine months ended September 30, 2023 and 2022. The aggregate intrinsic value of stock options exercised during the three and nine months ended September 30, 2023 was $1.8 million and $6.4 million, respectively, and was $0.3 million and $12.5 million for the three and nine months ended September 30, 2022, respectively. The fair value of options vested during the three and nine months ended September 30, 2023 was $0.2 million and $1.0 million, respectively, and was $0.6 million and $2.1 million for the three and nine months ended September 30, 2022, respectively. Restricted Stock Units Restricted stock units (“RSUs”) are measured at the fair market value of the underlying stock at the grant date and the expense is recognized over the requisite service period. The service-based vesting condition for these awards is generally satisfied over four years. A summary of RSU activity is as follows (in thousands, except per share amounts): Number of Weighted- Aggregate Unvested as of December 31, 2022 7,622 $ 6.22 $ 27,975 Granted 10,239 4.09 Vested (1) (2,942) 5.63 Forfeited (584) 5.49 Unvested as of September 30, 2023 14,335 $ 4.85 $ 89,742 __________________ (1) Includes 1,009,820 shares vested but not issued due to net share settlement for payment of employee taxes. These shares that were withheld under net share settlement remain in the authorized but unissued pool under the 2021 Plan and can be reissued by the Company. Payment of employee taxes due to net share settlement are reflected as a financing activity within the condensed consolidated statements of cash flows. The total fair value of RSUs vested during the three and nine months ended September 30, 2023 was $6.1 million and $16.6 million, respectively, and was $5.7 million and $11.7 million for the three and nine months ended September 30, 2022, respectively. Stock-Based Compensation The following table summarizes stock-based compensation expense recorded in each component of operating expenses in the Company’s condensed consolidated statements of operations for the presented periods (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Operations and support $ 586 $ 473 $ 1,557 $ 1,214 Marketing 307 302 834 858 Product development 1,588 1,293 4,291 4,157 General and administrative 3,512 2,813 9,754 7,796 Total stock-based compensation expense $ 5,993 $ 4,881 $ 16,436 $ 14,025 No material income tax benefit related to stock-based compensation was recorded during the three and nine months ended September 30, 2023 and 2022 as the Company maintained a full valuation allowance against its net deferred tax assets within the United States. As of September 30, 2023, total unrecognized compensation cost related to unvested stock options was $0.3 million, which was expected to be recognized over a weighted average remaining service period of 0.5 years. As of September 30, 2023, total unrecognized compensation cost related to unvested RSUs was $66.3 million, which was expected to be recognized over a weighted average remaining service period of 2.9 years. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesThe Company’s tax provision for interim periods is determined using an estimated annual effective tax rate, adjusted for discrete items in the related period. The effective tax rates for the three and nine months ended September 30, 2023 were 1.2% and 2.9%, respectively, and (0.3)% and 0.6% for the three and nine months ended September 30, 2022, respectively. The effective tax rate differs from the statutory rate of 21% primarily due to the full valuation allowance on the U.S. deferred tax assets. The increase in the effective tax rate for the three months ended September 30, 2023 is primarily a function of the $10.9 million pre-tax earnings in the third quarter 2023, compared to the $15.1 million pre-tax loss for the same period of 2022. The increase in the effective tax rate for the nine months ended September 30, 2023 is primarily a function of $6.8 million pre-tax earnings through the third quarter of 2023 compared to the $27.1 million pre-tax loss for the same period of 2022 coupled with the impact of the U.S. deferred tax benefit related to the GoodPup acquisition recorded in the second quarter of 2022. During the three and nine months ended September 30, 2023, the amount of gross unrecognized tax benefits increased by $38,500 and $115,500, respectively, of which all, if recognized, would not affect the effective tax rate as these unrecognized tax benefits would increase deferred tax assets that would be subject to a full valuation allowance. |
Net Income (Loss) Per Share Att
Net Income (Loss) Per Share Attributable to Common Stockholders | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share Attributable to Common Stockholders | Net Income (Loss) Per Share Attributable to Common Stockholders The following table sets forth the computation of basic and diluted net income (loss) per common share attributable to common stockholders (in thousands, except per share amounts): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Numerator: Net income (loss) $ 10,500 $ (15,472) $ 5,591 $ (27,250) Denominator: Weighted-average shares attributable to common stockholders—basic 181,423 182,493 183,126 181,309 Dilutive effect of assumed conversion of stock options and RSUs 11,554 — 10,578 — Weighted-average shares attributable to common stockholders—diluted 192,977 182,493 193,704 181,309 Net income (loss) per share attributable to common stockholders: Basic $ 0.06 $ (0.08) $ 0.03 $ (0.15) Diluted $ 0.05 $ (0.08) $ 0.03 $ (0.15) The following potentially dilutive shares were not included in the calculation of diluted shares outstanding for the periods presented as the effect would have been anti-dilutive (in thousands): Nine Months Ended 2023 2022 Outstanding stock options and RSUs — 23,133 Sponsor earnout shares — 492 Total — 23,625 The Sponsor earnout shares noted above represent 492,326 unvested shares beneficially owned by the Sponsor and certain of its affiliates that will not vest until the Class A Common Stock achieves a volume weighted average price greater than or equal to $16.00 over any 20 trading days within any 30 trading day period (“Triggering Event III”) during the earnout period that expires in July 2028 (the “Earnout Period”). The Sponsor earnout shares are excluded from basic and diluted net income (loss) per share as Triggering Event III was not achieved as of September 30, 2023. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Share Repurchase Program Subsequent to the end of the third quarter of 2023 and through the date of issuance of these financial statements, the Company repurchased an additional 1,396,328 shares for a total cost of $9.1 million, excluding brokers’ commissions and excise tax, representing an average purchase price of $6.49 per share. On November 6, 2023, the Company announced that its board of directors had approved an extension of the Share Repurchase Program to run through February 28, 2025 and an increase to the total authorized amount under the program of up to $100.0 million resulting in a total authorized amount of up to $150.0 million of its Class A Common Stock, including the $49.0 million repurchased through November 1, 2023. Repurchases of the Class A Common Stock may be made on a discretionary basis from time to time through open market transactions (including through Rule 10b5-1 trading plans) or through privately negotiated transactions in accordance with applicable securities laws and other legal requirements, including the requirements of Rule 10b-18 under the Exchange Act. The Share Repurchase Program does not obligate the Company to acquire any specific number of shares of its Class A Common Stock. The timing, volume, purchase price and nature of repurchases will be determined by the Company’s management and depend on a variety of factors, including stock price, trading volume, market and economic conditions, other general business considerations such as alternative investment opportunities, applicable legal requirements and tax laws, and other relevant factors. Repurchases under the program have been authorized through February 28, 2025, but the program may be modified, suspended, or terminated at any time at the discretion of the Company’s board of directors. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||||||||
Net income (loss) | $ 10,500 | $ (253) | $ (4,656) | $ (15,472) | $ (3,632) | $ (8,146) | $ 5,591 | $ (27,250) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Sep. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | The unaudited condensed consolidated financial statements and accompanying notes include the accounts of the Company and its wholly owned subsidiaries, after elimination of all intercompany balances and transactions. |
Basis of Presentation | The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and the requirements of the U.S. Securities and Exchange Commission (the “SEC”) for interim financial information. Certain information and disclosures normally included in consolidated financial statements prepared in accordance with GAAP have been condensed or omitted. Accordingly, these unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2022. The information as of December 31, 2022 included in the condensed consolidated balance sheets was derived from those audited financial statements. The unaudited condensed consolidated financial statements have been prepared on the same basis as the annual consolidated financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial information for the interim periods presented. The unaudited condensed consolidated results of operations for the interim period are not necessarily indicative of the results to be expected for the year ending December 31, 2023 or for any other future annual or interim period. Reclassifications Certain amounts previously presented for prior periods have been reclassified to conform to current presentation. These reclassifications did not affect assets, liabilities, net loss, cash flows or equity for the periods presented. |
Use of Estimates | The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated balance sheets and the reported amounts of revenue and expenses during the reporting period. Significant items subject to such estimates and assumptions, include, but are not limited to, the capitalization and estimated useful life of the Company’s internal-use software development costs, estimates used in impairment tests, the assumptions used in the valuation of leases, legal contingencies, stock-based compensation expense, income taxes and non-income tax reserves, and certain deferred tax assets and tax liabilities. These estimates and assumptions are based on information available as of the date of the condensed consolidated financial statements; therefore, actual results could differ from management’s estimates. Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. The Company adjusts such estimates and assumptions when facts and circumstances dictate. Changes in those estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in future periods. As future events and their effects cannot be determined with precision, actual results could materially differ from those estimates and assumptions. |
Segment Information | The Company has one operating segment and one reportable segment. As the Company’s chief operating decision maker, the chief executive officer reviews financial information on a consolidated basis for purposes of allocating resources and evaluating financial performance. Substantially all long-lived assets are located in the United States. Substantially all revenue is based in the United States, and no individual foreign country represents 10% or more of the Company’s revenue. |
Foreign Currencies | Foreign currency transaction gains and losses are a result of the effect of exchange rate changes on transactions denominated in currencies other than the functional currency. Gains and losses on those foreign currency transactions are included in determining net loss for the period of exchange and are recorded in other income (expense), net in the condensed consolidated statements of operations. |
Certain Significant Risks and Uncertainties | The Company is subject to certain risks and challenges associated with other companies at a similar stage of development, including risks associated with: dependence on key personnel; marketing; adaptation to changing market dynamics and customer preferences; and potential competition including from larger companies that may have greater name recognition, longer operating histories, more and better established customer relationships and greater resources than the Company.The Company’s ability to provide a reliable platform largely depends on the efficient and consistent operation of its technology information systems and those of its third-party service providers. Any significant interruptions could harm the Company’s business and reputation and result in a loss of business. To management’s knowledge, no interruptions, attacks or breaches have, individually, or in the aggregate, resulted in any material liability to the Company, any material damage to the Company’s reputation, or any material disruption to the Company’s business. |
Concentrations of Credit Risk | Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of cash, investments and accounts receivable. The Company maintains cash balances that exceed, and may in the future exceed, the insured limits set by the Federal Deposit Insurance Corporation. The Company has not experienced any losses on its deposits of cash and cash equivalents. The Company reduces credit risk by placing cash and investment balances with major financial institutions that management assesses to be of high-credit quality and also limits purchases of debt securities to investment-grade securities. The Company regularly evaluates the credit rating for issuers of government and corporate debt securities that it holds and other non-financial third party institutions. |
Revenue Recognition | Marketplace Platform Revenue The Company operates an online marketplace that provides a platform for pet parents and pet care providers to communicate and arrange for pet care services. The Company derives substantially all, or approximately 90% or more, of its revenue from pet parents’ and pet care providers’ use of the Company’s platform and related services that enable pet care providers to offer, book, and fulfill pet care services. The Company enters into its standard terms of service with pet care providers and pet parents who wish to use the Company’s platform. The terms of service define the rights and responsibilities of pet care providers and pet parents when using the Company’s platform as well as general payment terms. The Company charges a fixed percentage service fee for each arrangement of pet care services between the pet parent and the pet care provider on the Company’s platform (a booking) and do not vary based on the volume of transactions. A booking defines the explicit fee from which the Company earns its fixed percentage service fee. The creation of a booking combined with the terms of service establish enforceable rights and obligations for the transaction. A contract exists between the pet care provider and the Company upon the creation of a booking and after the pet care providers’ cancellation period has lapsed. Pet care providers are considered the Company’s customers to the extent that they pay a fixed percentage fee, generally up to a fixed dollar amount, to the Company for the booking. Similarly, pet parents are considered the Company’s customers and a contract exists between the pet parent and the Company upon the creation of a booking and after the pet care providers’ stated cancellation period has lapsed. Pet parents pay for services at the time of booking. The Company considers the facilitation of the connection between pet care provider and pet parent to be the promise in the contracts. This is consistent with the terms of service, as well as the substance of what a pet care provider or pet parent is expecting from the use of the Company’s platform. While customers have access to the use of the platform, customer support, and other activities, these activities are not considered distinct from each other in the context of the overall arrangement, which is the facilitation of a connection between a pet care provider and a pet parent. As such, the Company has determined that its sole performance obligation is to facilitate a connection between pet care providers and pet parents through its platform. The Company’s performance obligation is satisfied at a point-in-time when the connection has been completed, which is when the pet care provider and pet parent have completed a booking, any related cancellation period has lapsed, and the related underlying pet care services have begun. The Company derives revenue from pet care providers and pet parents primarily in the United States, as well as Canada, the United Kingdom and Western Europe. Judgment is required in determining whether the Company is the principal or agent in transactions with pet care providers and pet parents. The Company evaluates the presentation of revenue on a gross or net basis based on whether it controls the service provided to the pet parent and is therefore the principal, or the Company arranges for other parties to provide the service to the pet parent and is therefore the agent. The Company has concluded it is the agent in transactions with pet care providers and pet parents because, among other factors, it is not responsible for the delivery of pet care services provided by the pet care provider to the pet parent. Accordingly, the Company recognizes revenue on a net basis, representing the fee the Company expects to receive in exchange for providing access to the Company’s platform to pet care providers and pet parents. The Company has no significant financing components in its contracts with customers. The Company recognizes revenue net of any sales tax paid related to its revenue transactions. Provider Onboarding Revenue The Company earns revenue from non-refundable provider onboarding fees by completing quality assurance reviews of new pet care provider profiles including obtaining background checks, which are performed by a third party. Pet care providers pay the onboarding fee at the time of sign up. The Company recognizes revenue related to provider onboarding services at a point-in-time upon satisfaction of the related performance obligation, determined to be the completion of the quality assurance review of the pet care provider’s profile including a background check. The Company is considered to be a principal in these transactions and recognizes revenue on a gross basis. Costs associated with performing the pet care provider onboarding review are recognized in cost of revenue (exclusive of depreciation and amortization shown separately). Payments to Customers From time to time, the Company makes payments to pet parents and pet care providers as part of its marketing promotions, incentive programs and refund activities. Marketing Promotions and Incentive Programs The Company encourages the use of its platform and attracts new customers through its marketing promotions and incentive programs. The Company uses marketing promotions in tandem with sales and marketing spend to attract new pet parents to its platform. Promotions offered to pet parents in the form of credits, coupons or discounts are recorded as a reduction of revenue or included in marketing expense. The Company offers referral credits to its existing pet parents or pet care providers for referrals of new pet parents or pet care providers. These referral credits are paid in exchange for a distinct marketing service and therefore the portion of these credits that is equal to or less than the cost of acquiring a new pet parent or pet care provider are accounted for as a customer acquisition cost. These new customer acquisition costs are expensed as incurred and reflected as marketing expenses in the Company’s condensed consolidated statements of operations. The portion of these credits in excess of the fair value of acquiring a new pet parent or pet care provider is accounted for as a reduction of revenue. On occasion, the Company offers promotional discounts to existing pet parents. The Company records incentives provided to existing pet parents as a promotion and reduces revenue on the date that the corresponding revenue transaction is recorded. Refunds In certain instances, the Company issues refunds to pet parents as part of its customer support activities for customer satisfaction matters in the form of credits to be applied toward a future booking. The Company accounts for such refunds as variable consideration and therefore records the amount of each refund or credit issued as a reduction of revenue. Pet Parent Deposits and Pet Care Provider Liabilities The Company records payments received from pet parents, excluding the revenue portion due to the Company, in advance of the related services being provided as pet parent deposits. As the related performance obligations are satisfied, these amounts are settled through our payment processor and derecognized. In addition, we hold pet care provider liabilities relating to bookings completed prior to the implementation of our current payment processor and related systems where payment has not yet been requested by the pet care provider. The Company is subject to compliance with escheat laws applicable by jurisdiction where pet care providers do not claim the amounts owed to them for services rendered. Rover Guarantee In connection with services provided to facilitate the connections between pet care provider and pet parent, the Company provides a contractual guarantee to reimburse pet parents or pet care providers for certain expenses arising from injuries or other damages incurred during a service booked through the Company’s platform, subject to specified conditions (the “Rover Guarantee”). The Company’s obligation under the Rover Guarantee is accounted for in accordance with Accounting Standards Codification (“ASC”) 460, Guarantees |
Goodwill | Goodwill represents the excess of the aggregate fair value of the consideration transferred in a business combination over the fair value of the assets acquired, net of liabilities assumed. Goodwill is not amortized, but is subject to an annual impairment test. The Company performs its annual goodwill impairment test as of October 31, or more frequently if events or changes in circumstances indicate that the goodwill may be impaired. Management determined that the Company has two reporting units for which goodwill has been assigned for the evaluation of goodwill impairment, the Rover and GoodPup component business units. Events or changes in circumstances which could trigger an impairment review include significant changes in the manner of the Company’s use of the acquired assets or the strategy for the Company’s overall business, significant negative industry or economic trends, significant underperformance relative to historical or projected future results of operations, a significant adverse change in the business climate, cost factors that have a negative effect on earnings and cash flows, an adverse action or assessment by a regulator, estimated per share fair value of common stock, unanticipated competition or a loss of key personnel. The Company has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more-likely-than-not that the fair value of the reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, the Company determines it is not more-likely-than-not that the fair value of the reporting unit is less than its carrying amount, then additional impairment testing is not required. However, if the Company concludes otherwise, then it is required to perform a quantitative assessment for impairment. |
Intangible Assets | Intangible assets are amortized over the estimated useful life of the assets. Amortization of intangible assets associated with or used in the services provided by the Company from which it generates revenue are classified within cost of revenue (exclusive of depreciation and amortization shown separately) in the Company’s statements of operations. Amortization of intangible assets not associated with or used in the services provided by the Company from which it generates revenue are classified within depreciation and amortization expense within the Company’s statements of operations. For the periods presented, amortization of the Company’s capitalized internal-use software costs related to its online platform has been included within cost of revenues. For the periods presented, amortization expense related to other intangible assets have been classified within depreciation and amortization within the Company’s statement of operations. See Note 2—Summary of Significant Accounting Policies— Interim Impairment Assessment for additional information regarding the interim impairment assessment. The Company identified certain intangible assets, consisting of technology and tradenames, as defensive assets. These are assets that the Company acquired but does not intend to actively use. Rather, the Company intends to hold the assets to prevent others from obtaining access to the assets. |
Restricted Cash | Restricted CashThe Company classifies any cash balances that are restricted as to withdrawal or usage as restricted cash on the condensed consolidated balance sheets. |
Net Income (Loss) Per Share Attributable to Common Stockholders | Net Income (Loss) Per Share Attributable to Common Stockholders The Company calculates basic and diluted net income (loss) per share attributable to common stockholders in conformity with the two-class method required for participating securities. The two-class method requires income available to common stockholders for the period to be allocated between common stock and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. Basic net income (loss) per share is calculated by dividing net income (loss) attributable to common stockholders by the weighted-average number of common stock outstanding for the periods presented, without consideration for potentially dilutive securities. Diluted net income (loss) per share is calculated by giving effect to all potential weighted average dilutive common stock. The dilutive effect of outstanding awards and convertible securities is reflected in diluted net income (loss) per share by application of the treasury stock method or if-converted method, as applicable. |
Recently Adopted Accounting Pronouncements and Recently Issued Accounting Pronouncements | Recently Adopted Accounting Pronouncements The Company is provided the option to adopt new or revised accounting guidance as an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”) either (1) within the same periods as those otherwise applicable to public business entities, or (2) within the same time periods as private companies, including early adoption when permissible. The Company has elected to adopt new or revised accounting guidance within the same time period as public business entities, as indicated below. In March 2022, the FASB issued ASU No. 2022-02 Financial Instruments—Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures. The amendment in this ASU provides an update to: (1) troubled debt restructurings guidance in Subtopic 310-40 and enhances disclosure requirements for certain loan refinancings and restructurings; and (2) requires public entities to disclose current period gross write-offs by year of origination for financing receivables and net investments in leases. The guidance is effective for the Company for the year beginning after December 15, 2022. The Company adopted this standard on January 1, 2023 using the prospective transition method. The adoption of the new standard did not have a material impact on the Company’s condensed consolidated financial statements. Recently Issued Accounting Pronouncements In June 2022, the FASB issued ASU No. 2022-03 Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restriction. The amendment in this ASU clarifies that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. This amendment also requires public entities to add certain disclosures for equity securities subject to contractual sale restrictions. The guidance is effective for the Company for the year beginning after December 15, 2023. The Company will adopt this standard on January 1, 2024 using the prospective transition method. The Company does not expect the adoption of the new standard to have a material impact on the Company’s condensed consolidated financial statements but will continue to evaluate the new standard in future accounting periods. |
Fair Value | The Company recognizes transfers between levels within the fair value hierarchy, if any, at the end of each period. There were no transfers of financial instruments between valuation levels during the periods presented. The Company classifies financial instruments as Level 2 within the fair value hierarchy which are valued on the basis of prices from an orderly transaction between market participants provided by reputable dealers or pricing services. Prices of these securities are obtained through independent, third-party pricing services and include market quotations that may include both observable and unobservable inputs. In determining the value of a particular investment, pricing services may use certain information with respect to transactions in such investments, quotations from dealers, pricing matrices and market transactions in comparable investments and various relationships between investments. The Company classifies financial instruments in Level 3 of the fair value hierarchy when there is reliance on at least one significant unobservable input to the valuation model. In addition to these unobservable inputs, the valuation models for Level 3 financial instruments typically also rely on a number of inputs that are readily observable, either directly or indirectly. The Company’s assessment of a particular input to the fair value measurement requires management to make judgments and consider factors specific to the liability. The fair value hierarchy requires the use of observable market data when available in determining fair value. The Company recognizes transfers between levels within the fair value hierarchy, if any, at the end of each period. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Contract Liabilities | The changes in the Company’s deferred revenue balances were as follows (in thousands): Balance at June 30, 2023 $ 16,390 Bookings and other 62,858 Revenue recognized (66,136) Balance at September 30, 2023 $ 13,112 Balance at December 31, 2022 $ 5,544 Bookings and other 174,150 Revenue recognized (166,582) Balance at September 30, 2023 $ 13,112 |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Available-for-sale Securities Reconciliation | The amortized cost and fair value of the investments and unrealized gains and losses were as follows (in thousands): September 30, 2023 Amortized Costs Gross Unrealized Gains Gross Unrealized Losses Fair Value Marketable securities: Commercial paper $ 8,020 $ — $ (5) $ 8,015 Corporate securities 36,207 — (37) 36,170 US Government securities 42,427 — (121) 42,306 Asset-backed securities 4,746 — (7) 4,739 Agency bonds 9,205 — (16) 9,189 Certificate of deposit 1,321 — — 1,321 Total marketable securities 101,926 — (186) 101,740 Total investments $ 101,926 $ — $ (186) $ 101,740 December 31, 2022 Amortized Costs Gross Unrealized Gains Gross Unrealized Losses Fair Value Marketable securities: Commercial paper $ 54,851 $ — $ (51) $ 54,800 Corporate securities 38,260 — (220) 38,040 US Government securities 108,551 — (792) 107,759 Asset-backed securities 8,269 — (35) 8,234 Agency bonds 4,989 — (12) 4,977 Total marketable securities 214,920 — (1,110) 213,810 Other investments: Convertible notes 1,810 — — 1,810 Total other investments 1,810 — — 1,810 Total investments $ 216,730 $ — $ (1,110) $ 215,620 |
Schedule of Investments Classified by Contractual Maturity Date | The contractual maturity of the available-for-sale investments were as follows (in thousands): September 30, 2023 Within 1 year 1 to 5 years More than 5 years Total Marketable securities: Commercial paper $ 8,015 $ — $ — $ 8,015 Corporate securities 13,419 22,751 — 36,170 US Government securities 42,306 — — 42,306 Asset-backed securities 572 4,167 — 4,739 Agency bonds 9,189 — — 9,189 Certificate of deposit 1,321 — — 1,321 Total marketable securities 74,822 26,918 — 101,740 Total investments $ 74,822 $ 26,918 $ — $ 101,740 December 31, 2022 Within 1 year 1 to 5 years More than 5 years Total Marketable securities: Commercial paper $ 54,800 $ — $ — $ 54,800 Corporate securities 32,767 5,273 — 38,040 US Government securities 101,289 6,470 — 107,759 Asset-backed securities — 8,234 — 8,234 Agency bonds 2,491 2,486 — 4,977 Total marketable securities 191,347 22,463 — 213,810 Other investments: Convertible notes 1,810 — — 1,810 Total other investments 1,810 — — 1,810 Total investments $ 193,157 $ 22,463 $ — $ 215,620 |
Fair Value (Tables)
Fair Value (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Assets and Liabilities Measured on Recurring Basis | The following table presents the placement in the fair value hierarchy of assets and liabilities that are measured at fair value on a recurring basis (in thousands): September 30, 2023 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 17,800 $ — $ — $ 17,800 US Government securities — 6,969 — 6,969 Investments: Commercial paper — 8,015 — 8,015 Corporate securities — 36,170 — 36,170 US Government securities — 42,306 — 42,306 Asset-backed securities — 4,739 — 4,739 Agency bonds — 9,189 — 9,189 Certificate of deposit — 1,321 — 1,321 Total assets measured at fair value $ 17,800 $ 108,709 $ — $ 126,509 December 31, 2022 Level 1 Level 2 Level 3 Total Assets Cash equivalents: Money market funds $ 23,006 $ — $ — $ 23,006 Commercial paper — 7,954 — 7,954 Investments: Commercial paper — 54,800 — 54,800 Corporate securities — 38,040 — 38,040 US Government securities — 107,759 — 107,759 Asset-backed securities — 8,234 — 8,234 Agency bonds — 4,977 — 4,977 Other investments: Convertible notes — — 1,810 1,810 Total assets measured at fair value $ 23,006 $ 221,764 $ 1,810 $ 246,580 |
Schedule of Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | The following table provides a reconciliation of the beginning and ending balances for the Level 3 financial assets measured at fair value using significant unobservable inputs (in thousands): Convertible Notes Balance at December 31, 2022 $ 1,810 Additions during the period — Proportionate share of equity method losses (266) Incremental change in fair value 801 Conversion into investment in equity securities in related party (2,345) Balance at September 30, 2023 $ — |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Property, Plant and Equipment | The following table presents the detail of property and equipment, net as follows (in thousands): September 30, December 31, Computers $ 1,547 $ 1,452 Furniture and fixtures 3,799 3,777 Leasehold improvements 13,479 13,808 Internal-use software 24,485 21,652 Asset retirement obligation 225 225 Total property and equipment 43,535 40,914 Less: Accumulated depreciation and amortization (24,274) (21,396) Total property and equipment, net $ 19,261 $ 19,518 |
Schedule of Accrued Expenses and Other Current Liabilities | The following table presents the detail of accrued expenses and other current liabilities as follows (in thousands): September 30, December 31, Income and other tax liabilities $ 2,101 $ 1,670 Accrued legal expenses and open claims 917 686 Accrued legal settlements (1) — 18,000 Accrued professional services 696 435 Holdback related to business combination 1,343 1,343 Accrued share repurchase 553 — Coupon liabilities 317 205 Other current liabilities 564 355 Total accrued expenses and other current liabilities $ 6,491 $ 22,694 __________________ (1) See Note 9—Commitments and Contingencies for more information. |
Schedule of Accrued Expenses and Other Current Liabilities | The following table presents the detail of accrued expenses and other current liabilities as follows (in thousands): September 30, December 31, Income and other tax liabilities $ 2,101 $ 1,670 Accrued legal expenses and open claims 917 686 Accrued legal settlements (1) — 18,000 Accrued professional services 696 435 Holdback related to business combination 1,343 1,343 Accrued share repurchase 553 — Coupon liabilities 317 205 Other current liabilities 564 355 Total accrued expenses and other current liabilities $ 6,491 $ 22,694 __________________ (1) See Note 9—Commitments and Contingencies for more information. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following table summarizes the changes in the carrying amount of goodwill (in thousands): Balance at December 31, 2022 $ 36,915 GoodPup Impairment (3,756) Balance at September 30, 2023 $ 33,159 |
Schedule of Finite-Lived Intangible Assets | The gross book value, accumulated amortization, and impairment of intangible assets were as follows (in thousands): September 30, 2023 Gross Book Accumulated Impairment Net Book Pet parent relationships $ 6,600 $ (4,089) $ — $ 2,511 Shelter relationships 776 (155) (621) — Technologies 1,696 (565) (1,131) — Tradenames 1,302 (260) (1,042) — Training curriculum 551 (184) (367) — Total $ 10,925 $ (5,253) $ (3,161) $ 2,511 December 31, 2022 Gross Book Accumulated Impairment Net Book Pet parent relationships $ 6,600 $ (3,478) $ — $ 3,122 Shelter relationships 834 (135) — 699 Technologies 1,696 (283) — 1,413 Tradenames 1,302 (130) — 1,172 Training curriculum 551 (92) — 459 Total $ 10,983 $ (4,118) $ — $ 6,865 The weighted average amortization period remaining as of September 30, 2023 for each class of intangible assets were as follows (in years): Pet parent relationships 3.1 |
Schedule of Intangible Assets, Future Amortization Expense | Based on amounts recorded at September 30, 2023, the Company estimates intangible asset amortization expense in each of the years ending December 31 as follows (in thousands): Remainder of 2023 $ 204 2024 814 2025 814 2026 679 Thereafter — Total $ 2,511 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Lease Cost and Other Information | The components of lease cost were as follows (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Operating lease cost $ 982 $ 1,054 $ 2,944 $ 3,178 Short-term lease cost 171 39 495 39 Sublease income (296) (297) (888) (903) Total lease cost $ 857 $ 796 $ 2,551 $ 2,314 Other information related to leases was as follows (in thousands): Nine Months Ended September 30, 2023 2022 Cash paid for operating lease liabilities $ 3,643 $ 3,471 Lease term and discount rate were as follows: As of September 30, 2023 As of December 31, 2022 Weighted-average discount rate 7.30 % 7.27 % Weighted-average remaining lease term (years) 6.11 6.82 |
Schedule of Operating Lease Maturity | Maturities of lease liabilities were as follows as of September 30, 2023 (in thousands): Year Ending December 31 Amounts Remainder of 2023 $ 759 2024 4,569 2025 4,693 2026 4,430 2027 4,353 Thereafter 9,430 Total lease payments 28,234 Less: imputed interest (5,678) Present value of lease liabilities 22,556 Less: current portion of lease liabilities (2,613) Total lease liabilities, noncurrent $ 19,943 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Schedule of Shares Repurchased and Retired | The following table presents the open-market share purchase activity for the three and nine months ended September 30, 2023 and 2022, exclusive of brokers’ commissions and excise tax (in thousands, except share and per share data): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Total number of shares purchased 3,470,715 — 7,749,117 — Average price paid per share $ 5.88 $ — $ 5.16 $ — Total cost $ 20,400 $ — $ 39,981 $ — |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Equity Awards Available for Grant | A summary of equity awards available for grant is as follows (in thousands): Equity Available Balances as of December 31, 2022 7,881 Equity awards authorized 9,226 Equity awards granted (10,239) Equity awards canceled and forfeited 871 Equity awards withheld under net share settlement 1,010 Balances as of September 30, 2023 8,749 |
Schedule of Stock Option Activity | A summary of stock option activity is as follows (in thousands, except per share amounts and years): Number of Weighted- Weighted- Aggregate Balance as of December 31, 2022 14,363 $ 1.71 4.9 $ 28,251 Options exercised (1,960) 1.49 Options canceled and forfeited (287) 2.31 Balances as of September 30, 2023 12,116 $ 1.73 4.3 $ 54,894 Options vested and exercisable as of September 30, 2023 11,742 $ 1.72 4.2 $ 53,349 |
Share-based Payment Arrangement, Restricted Stock Unit, Activity | A summary of RSU activity is as follows (in thousands, except per share amounts): Number of Weighted- Aggregate Unvested as of December 31, 2022 7,622 $ 6.22 $ 27,975 Granted 10,239 4.09 Vested (1) (2,942) 5.63 Forfeited (584) 5.49 Unvested as of September 30, 2023 14,335 $ 4.85 $ 89,742 __________________ (1) Includes 1,009,820 shares vested but not issued due to net share settlement for payment of employee taxes. These shares that were withheld under net share settlement remain in the authorized but unissued pool under the 2021 Plan and can be reissued by the Company. Payment of employee taxes due to net share settlement are reflected as a financing activity within the condensed consolidated statements of cash flows. |
Schedule of Stock-Based Compensation Expense | The following table summarizes stock-based compensation expense recorded in each component of operating expenses in the Company’s condensed consolidated statements of operations for the presented periods (in thousands): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Operations and support $ 586 $ 473 $ 1,557 $ 1,214 Marketing 307 302 834 858 Product development 1,588 1,293 4,291 4,157 General and administrative 3,512 2,813 9,754 7,796 Total stock-based compensation expense $ 5,993 $ 4,881 $ 16,436 $ 14,025 |
Net Income (Loss) Per Share A_2
Net Income (Loss) Per Share Attributable to Common Stockholders (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings (Loss) Per Share, Basic and Diluted | The following table sets forth the computation of basic and diluted net income (loss) per common share attributable to common stockholders (in thousands, except per share amounts): Three Months Ended Nine Months Ended 2023 2022 2023 2022 Numerator: Net income (loss) $ 10,500 $ (15,472) $ 5,591 $ (27,250) Denominator: Weighted-average shares attributable to common stockholders—basic 181,423 182,493 183,126 181,309 Dilutive effect of assumed conversion of stock options and RSUs 11,554 — 10,578 — Weighted-average shares attributable to common stockholders—diluted 192,977 182,493 193,704 181,309 Net income (loss) per share attributable to common stockholders: Basic $ 0.06 $ (0.08) $ 0.03 $ (0.15) Diluted $ 0.05 $ (0.08) $ 0.03 $ (0.15) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following potentially dilutive shares were not included in the calculation of diluted shares outstanding for the periods presented as the effect would have been anti-dilutive (in thousands): Nine Months Ended 2023 2022 Outstanding stock options and RSUs — 23,133 Sponsor earnout shares — 492 Total — 23,625 |
Organization and Description _2
Organization and Description of Business (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Cash and cash equivalents | $ 129,142 | $ 58,875 | $ 65,518 |
Short-term investments | 74,800 | ||
Long-term investments | 26,900 | ||
Accumulated deficit | $ (377,049) | $ (342,305) |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Narrative (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2023 USD ($) | Jun. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) segment reporting_unit | Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Concentration Risk [Line Items] | ||||||
Number of operating segments | segment | 1 | |||||
Number of reportable segments | segment | 1 | |||||
Gain (loss) on foreign currency transaction before tax | $ (600) | $ (200) | $ (200) | $ (1,000) | ||
Accounts receivable, net | 76,473 | 76,473 | $ 53,181 | |||
Advertising expense | 9,700 | 6,300 | $ 27,400 | 20,400 | ||
Number of reporting units with goodwill | reporting_unit | 2 | |||||
Impairment loss on intangible assets and goodwill | 0 | $ 6,900 | 0 | $ 6,916 | 0 | |
Restricted cash | 3,675 | $ 0 | 3,675 | $ 0 | 0 | |
Line of Credit | Letter of Credit | ||||||
Concentration Risk [Line Items] | ||||||
Letter of credit | 3,500 | 3,500 | ||||
Payment Processors | ||||||
Concentration Risk [Line Items] | ||||||
Accounts receivable, net | 73,900 | 73,900 | 51,100 | |||
Third Party | ||||||
Concentration Risk [Line Items] | ||||||
Accounts receivable, net | $ 2,000 | $ 2,000 | $ 1,400 |
Business Combinations (Details)
Business Combinations (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Jun. 15, 2022 | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Business Acquisition [Line Items] | ||||||
Recognition of indemnity holdback liabilities upon acquisition of businesses | $ 0 | $ 1,563,000 | ||||
Goodwill | $ 33,159,000 | $ 36,915,000 | 33,159,000 | |||
Early Stage Dog Training Company | ||||||
Business Acquisition [Line Items] | ||||||
Business combination, consideration transferred | $ 7,400,000 | |||||
Recognition of indemnity holdback liabilities upon acquisition of businesses | 1,600,000 | |||||
Intangible assets acquired, other than goodwill | 4,400,000 | |||||
Net assets and liabilities assumed | (1,000,000) | |||||
Goodwill | 4,000,000 | |||||
Goodwill, expected tax deductible amount | $ 0 | |||||
Measurement period adjustment, goodwill | 200,000 | |||||
Measurement period adjustment, net liabilities assumed | 100,000 | |||||
Measurement period adjustment, holdback liability | $ 100,000 | |||||
Acquisition related costs | $ 0 | $ 0 | $ 0 | $ 400,000 | ||
Early Stage Dog Training Company | Minimum | ||||||
Business Acquisition [Line Items] | ||||||
Useful life of acquired intangible assets | 3 years | |||||
Early Stage Dog Training Company | Maximum | ||||||
Business Acquisition [Line Items] | ||||||
Useful life of acquired intangible assets | 5 years |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2023 | Sep. 30, 2023 | |
Contract with Customer, Liability [Roll Forward] | ||
Beginning balance | $ 16,390 | $ 5,544 |
Bookings and other | 62,858 | 174,150 |
Revenue recognized | (66,136) | (166,582) |
Ending balance | $ 13,112 | $ 13,112 |
Investments - Schedule of Amort
Investments - Schedule of Amortized Cost and Fair Value of Available-for-sale Investments and Unrealized Gains and Losses (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Schedule Of Investments [Line Items] | ||
Amortized Costs | $ 101,926 | $ 216,730 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (186) | (1,110) |
Fair Value | 101,740 | 215,620 |
Marketable securities: | ||
Schedule Of Investments [Line Items] | ||
Amortized Costs | 101,926 | 214,920 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (186) | (1,110) |
Fair Value | 101,740 | 213,810 |
Commercial paper | ||
Schedule Of Investments [Line Items] | ||
Amortized Costs | 8,020 | 54,851 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (5) | (51) |
Fair Value | 8,015 | 54,800 |
Corporate securities | ||
Schedule Of Investments [Line Items] | ||
Amortized Costs | 36,207 | 38,260 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (37) | (220) |
Fair Value | 36,170 | 38,040 |
US Government securities | ||
Schedule Of Investments [Line Items] | ||
Amortized Costs | 42,427 | 108,551 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (121) | (792) |
Fair Value | 42,306 | 107,759 |
Asset-backed securities | ||
Schedule Of Investments [Line Items] | ||
Amortized Costs | 4,746 | 8,269 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (7) | (35) |
Fair Value | 4,739 | 8,234 |
Agency bonds | ||
Schedule Of Investments [Line Items] | ||
Amortized Costs | 9,205 | 4,989 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (16) | (12) |
Fair Value | 9,189 | 4,977 |
Certificate of deposit | ||
Schedule Of Investments [Line Items] | ||
Amortized Costs | 1,321 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Fair Value | $ 1,321 | |
Other investments: | ||
Schedule Of Investments [Line Items] | ||
Amortized Costs | 1,810 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Fair Value | 1,810 | |
Convertible notes | ||
Schedule Of Investments [Line Items] | ||
Amortized Costs | 1,810 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Fair Value | $ 1,810 |
Investments - Schedule of Contr
Investments - Schedule of Contractual Maturity of Available-for-sale Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Schedule Of Investments [Line Items] | ||
Within 1 year | $ 74,822 | $ 193,157 |
1 to 5 years | 26,918 | 22,463 |
More than 5 years | 0 | 0 |
Total | 101,740 | 215,620 |
Marketable securities: | ||
Schedule Of Investments [Line Items] | ||
Within 1 year | 74,822 | 191,347 |
1 to 5 years | 26,918 | 22,463 |
More than 5 years | 0 | 0 |
Total | 101,740 | 213,810 |
Commercial paper | ||
Schedule Of Investments [Line Items] | ||
Within 1 year | 8,015 | 54,800 |
1 to 5 years | 0 | 0 |
More than 5 years | 0 | 0 |
Total | 8,015 | 54,800 |
Corporate securities | ||
Schedule Of Investments [Line Items] | ||
Within 1 year | 13,419 | 32,767 |
1 to 5 years | 22,751 | 5,273 |
More than 5 years | 0 | 0 |
Total | 36,170 | 38,040 |
US Government securities | ||
Schedule Of Investments [Line Items] | ||
Within 1 year | 42,306 | 101,289 |
1 to 5 years | 0 | 6,470 |
More than 5 years | 0 | 0 |
Total | 42,306 | 107,759 |
Asset-backed securities | ||
Schedule Of Investments [Line Items] | ||
Within 1 year | 572 | 0 |
1 to 5 years | 4,167 | 8,234 |
More than 5 years | 0 | 0 |
Total | 4,739 | 8,234 |
Agency bonds | ||
Schedule Of Investments [Line Items] | ||
Within 1 year | 9,189 | 2,491 |
1 to 5 years | 0 | 2,486 |
More than 5 years | 0 | 0 |
Total | 9,189 | 4,977 |
Certificate of deposit | ||
Schedule Of Investments [Line Items] | ||
Within 1 year | 1,321 | |
1 to 5 years | 0 | |
More than 5 years | 0 | |
Total | $ 1,321 | |
Other investments: | ||
Schedule Of Investments [Line Items] | ||
Within 1 year | 1,810 | |
1 to 5 years | 0 | |
More than 5 years | 0 | |
Total | 1,810 | |
Convertible notes | ||
Schedule Of Investments [Line Items] | ||
Within 1 year | 1,810 | |
1 to 5 years | 0 | |
More than 5 years | 0 | |
Total | $ 1,810 |
Investments - Other Investments
Investments - Other Investments (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||
Jun. 30, 2023 | Nov. 30, 2022 | Sep. 30, 2022 | Jul. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Schedule Of Investments [Line Items] | |||||||||
Equity investments without readily determinable fair value | $ 0 | ||||||||
Purchases of convertible notes | $ 0 | $ 1,310,000 | |||||||
Change in fair value of other investments | $ 0 | $ 0 | 1,115,000 | 0 | |||||
Purchases of equity securities in related parties | 1,500,000 | 0 | |||||||
Loss from equity method investments | 316,000 | 325,000 | 981,000 | 325,000 | |||||
Related Party | |||||||||
Schedule Of Investments [Line Items] | |||||||||
Equity investments without readily determinable fair value | 3,800,000 | 3,800,000 | |||||||
Shares issued (in shares) | 5,000,000 | ||||||||
Purchases of convertible notes | $ 500,000 | $ 300,000 | $ 1,000,000 | ||||||
Investment interest rate | 5% | ||||||||
Additional investment in equity method investments | $ 2,300,000 | ||||||||
Change in fair value of other investments | 0 | 0 | 1,100,000 | 0 | |||||
Asset impairment charges | $ 0 | $ 0 | $ 0 | $ 0 | |||||
Purchases of equity securities in related parties | $ 1,500,000 | ||||||||
Related Party | Joint Venture With Pioneer Square Labs | |||||||||
Schedule Of Investments [Line Items] | |||||||||
Ownership percentage | 15% | ||||||||
Related Party | Convertible Note Conversion | |||||||||
Schedule Of Investments [Line Items] | |||||||||
Equity method investment, number of shares converted (in shares) | 4,162,357 | ||||||||
Equity method investment, conversion price of shares converted (in dollars per share) | $ 0.4507 | $ 0.4507 | |||||||
Related Party | Additional Investment | |||||||||
Schedule Of Investments [Line Items] | |||||||||
Equity method investment, number of shares converted (in shares) | 2,662,406 | ||||||||
Equity method investment, conversion price of shares converted (in dollars per share) | $ 0.5634 | $ 0.5634 |
Fair Value - Assets and Liabili
Fair Value - Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Assets | ||
Investments | $ 101,740 | $ 215,620 |
Commercial paper | ||
Assets | ||
Investments | 8,015 | 54,800 |
Corporate securities | ||
Assets | ||
Investments | 36,170 | 38,040 |
US Government securities | ||
Assets | ||
Investments | 42,306 | 107,759 |
Asset-backed securities | ||
Assets | ||
Investments | 4,739 | 8,234 |
Agency bonds | ||
Assets | ||
Investments | 9,189 | 4,977 |
Certificate of deposit | ||
Assets | ||
Investments | 1,321 | |
Fair Value, Recurring | ||
Assets | ||
Convertible notes | 1,810 | |
Total assets measured at fair value | 126,509 | 246,580 |
Fair Value, Recurring | Commercial paper | ||
Assets | ||
Investments | 8,015 | 54,800 |
Fair Value, Recurring | Corporate securities | ||
Assets | ||
Investments | 36,170 | 38,040 |
Fair Value, Recurring | US Government securities | ||
Assets | ||
Investments | 42,306 | 107,759 |
Fair Value, Recurring | Asset-backed securities | ||
Assets | ||
Investments | 4,739 | 8,234 |
Fair Value, Recurring | Agency bonds | ||
Assets | ||
Investments | 9,189 | 4,977 |
Fair Value, Recurring | Certificate of deposit | ||
Assets | ||
Investments | 1,321 | |
Fair Value, Recurring | Money market funds | ||
Assets | ||
Money market funds | 17,800 | 23,006 |
Fair Value, Recurring | US Government securities | ||
Assets | ||
Money market funds | 6,969 | |
Fair Value, Recurring | Commercial paper | ||
Assets | ||
Money market funds | 7,954 | |
Fair Value, Recurring | Level 1 | ||
Assets | ||
Convertible notes | 0 | |
Total assets measured at fair value | 17,800 | 23,006 |
Fair Value, Recurring | Level 1 | Commercial paper | ||
Assets | ||
Investments | 0 | 0 |
Fair Value, Recurring | Level 1 | Corporate securities | ||
Assets | ||
Investments | 0 | 0 |
Fair Value, Recurring | Level 1 | US Government securities | ||
Assets | ||
Investments | 0 | 0 |
Fair Value, Recurring | Level 1 | Asset-backed securities | ||
Assets | ||
Investments | 0 | 0 |
Fair Value, Recurring | Level 1 | Agency bonds | ||
Assets | ||
Investments | 0 | 0 |
Fair Value, Recurring | Level 1 | Certificate of deposit | ||
Assets | ||
Investments | 0 | |
Fair Value, Recurring | Level 1 | Money market funds | ||
Assets | ||
Money market funds | 17,800 | 23,006 |
Fair Value, Recurring | Level 1 | US Government securities | ||
Assets | ||
Money market funds | 0 | |
Fair Value, Recurring | Level 1 | Commercial paper | ||
Assets | ||
Money market funds | 0 | |
Fair Value, Recurring | Level 2 | ||
Assets | ||
Convertible notes | 0 | |
Total assets measured at fair value | 108,709 | 221,764 |
Fair Value, Recurring | Level 2 | Commercial paper | ||
Assets | ||
Investments | 8,015 | 54,800 |
Fair Value, Recurring | Level 2 | Corporate securities | ||
Assets | ||
Investments | 36,170 | 38,040 |
Fair Value, Recurring | Level 2 | US Government securities | ||
Assets | ||
Investments | 42,306 | 107,759 |
Fair Value, Recurring | Level 2 | Asset-backed securities | ||
Assets | ||
Investments | 4,739 | 8,234 |
Fair Value, Recurring | Level 2 | Agency bonds | ||
Assets | ||
Investments | 9,189 | 4,977 |
Fair Value, Recurring | Level 2 | Certificate of deposit | ||
Assets | ||
Investments | 1,321 | |
Fair Value, Recurring | Level 2 | Money market funds | ||
Assets | ||
Money market funds | 0 | 0 |
Fair Value, Recurring | Level 2 | US Government securities | ||
Assets | ||
Money market funds | 6,969 | |
Fair Value, Recurring | Level 2 | Commercial paper | ||
Assets | ||
Money market funds | 7,954 | |
Fair Value, Recurring | Level 3 | ||
Assets | ||
Convertible notes | 1,810 | |
Total assets measured at fair value | 0 | 1,810 |
Fair Value, Recurring | Level 3 | Commercial paper | ||
Assets | ||
Investments | 0 | 0 |
Fair Value, Recurring | Level 3 | Corporate securities | ||
Assets | ||
Investments | 0 | 0 |
Fair Value, Recurring | Level 3 | US Government securities | ||
Assets | ||
Investments | 0 | 0 |
Fair Value, Recurring | Level 3 | Asset-backed securities | ||
Assets | ||
Investments | 0 | 0 |
Fair Value, Recurring | Level 3 | Agency bonds | ||
Assets | ||
Investments | 0 | 0 |
Fair Value, Recurring | Level 3 | Certificate of deposit | ||
Assets | ||
Investments | 0 | |
Fair Value, Recurring | Level 3 | Money market funds | ||
Assets | ||
Money market funds | 0 | 0 |
Fair Value, Recurring | Level 3 | US Government securities | ||
Assets | ||
Money market funds | $ 0 | |
Fair Value, Recurring | Level 3 | Commercial paper | ||
Assets | ||
Money market funds | $ 0 |
Fair Value - Level 3 Financial
Fair Value - Level 3 Financial Assets Measured at Fair Value Using Significant Unobservable Inputs (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Fair value, measurement beginning balance | $ 1,810 |
Additions during the period | 0 |
Conversion into investment in equity securities in related party | (2,345) |
Fair value, measurement ending balance | 0 |
Proportionate share of equity method losses | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Gain (loss) included in earnings | (266) |
Incremental change in fair value | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Gain (loss) included in earnings | $ 801 |
Fair Value - Narrative (Details
Fair Value - Narrative (Details) - USD ($) | 1 Months Ended | |||
Jun. 30, 2023 | Jan. 31, 2022 | Sep. 30, 2023 | Dec. 31, 2022 | |
Class of Stock [Line Items] | ||||
Notes receivable from related parties | $ 0 | $ 1,810,000 | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | ||
Exercise price of warrant (in dollars per share) | $ 0.10 | |||
Number of warrants redeemed (in shares) | 74,631 | |||
Warrant liabilities outstanding | $ 0 | |||
Joint Venture With Pioneer Square Labs | Corporate Joint Venture | ||||
Class of Stock [Line Items] | ||||
Notes receivable from related parties | $ 0 | $ 1,800,000 | ||
Additional investment in equity method investments | $ 2,300,000 | |||
Public Warrants | ||||
Class of Stock [Line Items] | ||||
Number of warrants exercised (in shares) | 5,425,349 | |||
Percent of total warrants exercised | 98.60% | |||
Private Warrants | ||||
Class of Stock [Line Items] | ||||
Number of warrants exercised (in shares) | 2,574,164 | |||
Percent of total warrants exercised | 100% | |||
Class A common Stock | ||||
Class of Stock [Line Items] | ||||
Reclassification of derivative warrant liability and issuance of common stock from exercises of warrants (in shares) | 2,046,220 | |||
Common stock, par value (in dollars per share) | $ 0.0001 | |||
Number of shares called by each warrant (in shares) | 0.2558 |
Balance Sheet Components - Prop
Balance Sheet Components - Property and Equipment, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Property, Plant and Equipment [Line Items] | |||||
Asset retirement obligation | $ 225 | $ 225 | $ 225 | ||
Total property and equipment | 43,535 | 43,535 | 40,914 | ||
Less: Accumulated depreciation and amortization | (24,274) | (24,274) | (21,396) | ||
Total property and equipment, net | 19,261 | 19,261 | 19,518 | ||
Depreciation and amortization | 1,000 | $ 1,000 | 3,000 | $ 2,900 | |
Capitalized software development costs | 2,600 | 2,400 | 7,700 | 6,500 | |
Internal-use software amortization | 1,900 | $ 1,700 | 5,400 | $ 5,200 | |
Computers | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | 1,547 | 1,547 | 1,452 | ||
Furniture and fixtures | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | 3,799 | 3,799 | 3,777 | ||
Leasehold improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | 13,479 | 13,479 | 13,808 | ||
Internal-use software | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment | $ 24,485 | $ 24,485 | $ 21,652 |
Balance Sheet Components - Accr
Balance Sheet Components - Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Income and other tax liabilities | $ 2,101 | $ 1,670 |
Accrued legal expenses and open claims | 917 | 686 |
Accrued legal settlements | 0 | 18,000 |
Accrued professional services | 696 | 435 |
Holdback related to business combination | 1,343 | 1,343 |
Accrued share repurchase | 553 | 0 |
Coupon liabilities | 317 | 205 |
Other current liabilities | 564 | 355 |
Total accrued expenses and other current liabilities | $ 6,491 | $ 22,694 |
Balance Sheet Components - Empl
Balance Sheet Components - Employee Retention Credit (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Jul. 03, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Government Assistance [Line Items] | ||||||
Other (expense) income, net | $ (568) | $ (257) | $ 1,560 | $ (1,045) | ||
Employee Retention Credit | ||||||
Government Assistance [Line Items] | ||||||
Income realized related to the employee retention credit | $ 1,900 | |||||
Employee retention credit, current | $ 1,900 | |||||
Other (expense) income, net | $ 1,900 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Schedule of Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Jun. 30, 2023 | Sep. 30, 2023 | |
Goodwill [Roll Forward] | ||
Balance at December 31, 2022 | $ 36,915 | |
GoodPup Impairment | $ (3,800) | (3,756) |
Balance at September 30, 2023 | $ 33,159 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2023 | Jun. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||
GoodPup Impairment | $ 3,800 | $ 3,756 | ||||
Amortization of intangible assets | $ 200 | $ 600 | 1,200 | $ 1,500 | ||
Impairment | $ 3,200 | $ 3,161 | $ 0 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 | Sep. 30, 2023 | Dec. 31, 2022 | |
Finite-Lived Intangible Assets [Line Items] | |||
Gross Book Value | $ 10,925 | $ 10,925 | $ 10,983 |
Accumulated Amortization | (5,253) | (5,253) | (4,118) |
Impairment | (3,200) | (3,161) | 0 |
Intangible assets, net | 2,511 | 2,511 | 6,865 |
Pet parent relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Book Value | 6,600 | 6,600 | 6,600 |
Accumulated Amortization | (4,089) | (4,089) | (3,478) |
Impairment | 0 | ||
Intangible assets, net | $ 2,511 | $ 2,511 | 3,122 |
Remaining amortization period | 3 years 1 month 6 days | 3 years 1 month 6 days | |
Shelter relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Book Value | $ 776 | $ 776 | 834 |
Accumulated Amortization | (155) | (155) | (135) |
Impairment | (621) | ||
Intangible assets, net | 0 | 0 | 699 |
Technologies | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Book Value | 1,696 | 1,696 | 1,696 |
Accumulated Amortization | (565) | (565) | (283) |
Impairment | (1,131) | ||
Intangible assets, net | 0 | 0 | 1,413 |
Tradenames | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Book Value | 1,302 | 1,302 | 1,302 |
Accumulated Amortization | (260) | (260) | (130) |
Impairment | (1,042) | ||
Intangible assets, net | 0 | 0 | 1,172 |
Training curriculum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Book Value | 551 | 551 | 551 |
Accumulated Amortization | (184) | (184) | (92) |
Impairment | (367) | ||
Intangible assets, net | $ 0 | $ 0 | $ 459 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Future Amortization Expense (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of 2023 | $ 204 | |
2024 | 814 | |
2025 | 814 | |
2026 | 679 | |
Thereafter | 0 | |
Net Book Value | $ 2,511 | $ 6,865 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | ||||||||
Sep. 18, 2023 facility | Sep. 01, 2023 USD ($) | Jan. 12, 2023 USD ($) | Apr. 30, 2021 facility | Sep. 30, 2022 USD ($) | Oct. 31, 2023 | Sep. 30, 2023 USD ($) | Dec. 31, 2022 USD ($) | May 31, 2022 | Feb. 29, 2020 | |
Lessee, Lease, Description [Line Items] | ||||||||||
Sublease option to extend | 1 year | 1 year | 2 years | |||||||
Sublease income, additional base lease payments | $ 500 | |||||||||
Number of leased facilities | facility | 1 | 1 | ||||||||
Restricted cash | $ 0 | 3,675 | $ 0 | |||||||
Letter of Credit | Line of Credit | ||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||
Letter of credit | 3,500 | |||||||||
Letter of Credit | Unsecured Debt | ||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||
Letter of credit | 100 | |||||||||
Amendment Sublease Agreement | ||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||
Sublease income, additional base lease payments | $ 700 | |||||||||
Melanie Sportsman v. A Place for Rover, Inc | ||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||
Expected settlement payment | $ 17,900 | |||||||||
Melanie Sportsman v. A Place for Rover, Inc | Settled Litigation | ||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||
Payment of all claims | $ 18,000 | $ 18,000 | ||||||||
Subsequent Event | ||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||
Sublease option to extend | 1 year | |||||||||
Office space | Minimum | ||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||
Renewal term | 1 year | |||||||||
Office space | Maximum | ||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||
Renewal term | 7 years |
Commitments and Contingencies_2
Commitments and Contingencies - Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | ||||
Operating lease cost | $ 982 | $ 1,054 | $ 2,944 | $ 3,178 |
Short-term lease cost | 171 | 39 | 495 | 39 |
Sublease income | (296) | (297) | (888) | (903) |
Total lease cost | $ 857 | $ 796 | $ 2,551 | $ 2,314 |
Commitments and Contingencies_3
Commitments and Contingencies - Other Information (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Cash paid for operating lease liabilities | $ 3,643 | $ 3,471 | |
Weighted-average discount rate | 7.30% | 7.27% | |
Weighted-average remaining lease term (years) | 6 years 1 month 9 days | 6 years 9 months 25 days |
Commitments and Contingencies_4
Commitments and Contingencies - Lease Maturity (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Commitments and Contingencies Disclosure [Abstract] | ||
Remainder of 2023 | $ 759 | |
2024 | 4,569 | |
2025 | 4,693 | |
2026 | 4,430 | |
2027 | 4,353 | |
Thereafter | 9,430 | |
Total lease payments | 28,234 | |
Less: imputed interest | (5,678) | |
Present value of lease liabilities | 22,556 | |
Less: current portion of lease liabilities | (2,613) | $ (2,727) |
Total lease liabilities, noncurrent | $ 19,943 | $ 22,208 |
Stockholders' Equity- Narrative
Stockholders' Equity- Narrative (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended |
Feb. 28, 2023 | Sep. 30, 2023 | Sep. 30, 2023 | |
Equity [Abstract] | |||
Stock repurchase program, period in force | 12 months | ||
Stock repurchase program, authorized amount | $ 50,000,000 | ||
Excise tax accrued | $ 100,000 | $ 200,000 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Open-Market Share Purchase Activity, Exclusive of Brokers’ Commissions and Excise Tax (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Equity [Abstract] | ||||
Total number of shares purchased (in shares) | 3,470,715 | 0 | 7,749,117 | 0 |
Average price paid per share (in dollars per share) | $ 5.88 | $ 0 | $ 5.16 | $ 0 |
Total cost | $ 20,400 | $ 0 | $ 39,981 | $ 0 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Jul. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Options outstanding under the 2011 Plan (in shares) | 12,116,000 | 12,116,000 | 14,363,000 | |||
Grants in period (in shares) | 0 | 0 | ||||
Aggregate intrinsic value of stock options exercised | $ 1,800,000 | $ 300,000 | $ 6,400,000 | $ 12,500,000 | ||
Fair value of options vested | 200,000 | 600,000 | 1,000,000 | 2,100,000 | ||
Income tax benefit related to stock-based compensation | 0 | 0 | 0 | 0 | ||
Unrecognized compensation cost related to unvested stock options | 300,000 | $ 300,000 | ||||
Outstanding stock options and RSUs | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Grants in period (in shares) | 10,239,000 | |||||
Weighted-average remaining contractual term for unvested stock options | 6 months | |||||
Restricted Stock Units (RSUs) | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 4 years | |||||
Fair value of RSUs vested | 6,100,000 | $ 5,700,000 | $ 16,600,000 | $ 11,700,000 | ||
Weighted-average remaining contractual term for unvested stock options | 2 years 10 months 24 days | |||||
Unrecognized compensation cost related to RSUs | $ 66,300,000 | $ 66,300,000 | ||||
2021 Plan | Share-based Payment Arrangement | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Number of shares initially reserved for issuance (in shares) | 8,700,000 | 8,700,000 | 17,200,000 | |||
2011 Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Options outstanding under the 2011 Plan (in shares) | 20,400,000 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Equity Available for Grant | |||
Equity awards granted (in shares) | 0 | 0 | |
Equity awards cancelled and forfeited (in shares) | 287,000 | ||
Number of Options Outstanding | |||
Balance as of beginning of period (in shares) | 14,363,000 | ||
Options exercised (in shares) | (1,960,000) | ||
Options cancelled and forfeited (in shares) | (287,000) | ||
Balance as of end of period (in shares) | 12,116,000 | 14,363,000 | |
Number of options vested and exercisable (in shares) | 11,742,000 | ||
Weighted- Average Exercise Price Per Share | |||
Outstanding options at period start (in dollars per share) | $ 1.71 | ||
Options exercised (in dollars per share) | 1.49 | ||
Options cancelled and forfeited (in dollars per share) | 2.31 | ||
Outstanding options at period end (in dollars per share) | 1.73 | $ 1.71 | |
Weighted average exercise price of options vested and exercisable (in dollars per share) | $ 1.72 | ||
Weighted- Average Remaining Contractual Term (Years) | |||
Weighted average remaining contractual term of options outstanding | 4 years 3 months 18 days | 4 years 10 months 24 days | |
Weighted average remaining contractual term of options vested and exercisable | 4 years 2 months 12 days | ||
Aggregate Intrinsic Value | |||
Aggregate intrinsic value of options outstanding | $ 54,894 | $ 28,251 | |
Aggregate intrinsic value of options vested and exercisable | $ 53,349 | ||
Outstanding stock options and RSUs | |||
Equity Available for Grant | |||
Balance as of beginning of period (in shares) | 7,881,000 | ||
Equity awards authorized (in shares) | 9,226,000 | ||
Equity awards granted (in shares) | (10,239,000) | ||
Equity awards cancelled and forfeited (in shares) | 871,000 | ||
Equity awards withheld under net share settlement (in shares) | 1,010,000 | ||
Balance as of end of period (in shares) | 8,749,000 | 7,881,000 | |
Number of Options Outstanding | |||
Options cancelled and forfeited (in shares) | (871,000) |
Stock-Based Compensation - Sc_2
Stock-Based Compensation - Schedule of Restricted Stock Units (Details) - Restricted Stock Units (RSUs) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | |
Number of Shares | ||
Unvested, beginning of period (in shares) | 7,622,000 | |
Grants (in shares) | 10,239,000 | |
Vested (in shares) | (2,942,000) | |
Forfeited (in shares) | (584,000) | |
Unvested, end of period (in shares) | 14,335,000 | |
Weighted- Average Grant Date Fair Value | ||
Unvested beginning of period (in dollars per share) | $ 6.22 | |
Granted (in dollars per share) | 4.09 | |
Vested (in dollars per share) | 5.63 | |
Forfeited (in dollars per share) | 5.49 | |
Unvested end of period (in dollars per share) | $ 4.85 | |
Aggregate Intrinsic Value | ||
Unvested aggregate intrinsic value | $ 89,742 | $ 27,975 |
Equity awards withheld under net share settlement (in shares) | 1,009,820 |
Stock-Based Compensation - Sc_3
Stock-Based Compensation - Schedule of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | $ 5,993 | $ 4,881 | $ 16,436 | $ 14,025 |
Operations and support | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | 586 | 473 | 1,557 | 1,214 |
Marketing | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | 307 | 302 | 834 | 858 |
Product development | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | 1,588 | 1,293 | 4,291 | 4,157 |
General and administrative | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation expense | $ 3,512 | $ 2,813 | $ 9,754 | $ 7,796 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Effective tax rate | 1.20% | (0.30%) | 2.90% | 0.60% |
Income (loss) before income taxes and equity method investments | $ 10,944,000 | $ (15,103,000) | $ 6,771,000 | $ (27,097,000) |
Increase in unrecognized tax benefits | 38,500,000 | 115,500,000 | ||
Unrecognized tax benefits that would impact effective tax rate | $ 0 | $ 0 |
Net Income (Loss) Per Share A_3
Net Income (Loss) Per Share Attributable to Common Stockholders - EPS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Numerator: | ||||||||
Net income (loss) | $ 10,500 | $ (253) | $ (4,656) | $ (15,472) | $ (3,632) | $ (8,146) | $ 5,591 | $ (27,250) |
Denominator: | ||||||||
Weighted-average shares attributable to common stockholders—basic (in shares) | 181,423 | 182,493 | 183,126 | 181,309 | ||||
Dilutive effect of assumed conversion of stock options and RSUs (in shares) | 11,554 | 0 | 10,578 | 0 | ||||
Weighted-average shares attributable to common stockholders—diluted (in shares) | 192,977 | 182,493 | 193,704 | 181,309 | ||||
Net income (loss) per share attributable to common stockholders: | ||||||||
Basic (in dollars per share) | $ 0.06 | $ (0.08) | $ 0.03 | $ (0.15) | ||||
Diluted (in dollars per share) | $ 0.05 | $ (0.08) | $ 0.03 | $ (0.15) |
Net Income (Loss) Per Share A_4
Net Income (Loss) Per Share Attributable to Common Stockholders - Antidilutive (Details) - shares | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 0 | 23,625,000 |
Outstanding stock options and RSUs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 0 | 23,133,000 |
Sponsor earnout shares | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 0 | 492,326 |
Net Income (Loss) Per Share A_5
Net Income (Loss) Per Share Attributable to Common Stockholders - Narrative (Details) | 9 Months Ended | |
Sep. 30, 2023 d $ / shares shares | Sep. 30, 2022 shares | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 0 | 23,625,000 |
Sponsor earnout shares | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Earnout period, stock price trigger (in US dollar per share) | $ / shares | $ 16 | |
Earnout period, threshold trading days | d | 20 | |
Earnout period, threshold consecutive trading day | d | 30 | |
Sponsor earnout shares | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 0 | 492,326 |
Rover Earnout Shares | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from computation of earnings per share (in shares) | 2,192,687 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||
Nov. 08, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Nov. 01, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Nov. 06, 2023 | Feb. 28, 2023 | |
Subsequent Event [Line Items] | ||||||||
Total number of shares purchased (in shares) | 3,470,715 | 0 | 7,749,117 | 0 | ||||
Total cost | $ 20,400,000 | $ 0 | $ 39,981,000 | $ 0 | ||||
Average price paid per share (in dollars per share) | $ 5.88 | $ 0 | $ 5.16 | $ 0 | ||||
Stock repurchase program, authorized amount | $ 50,000,000 | |||||||
Subsequent Event | ||||||||
Subsequent Event [Line Items] | ||||||||
Total number of shares purchased (in shares) | 1,396,328 | |||||||
Total cost | $ 9,100,000 | |||||||
Average price paid per share (in dollars per share) | $ 6.49 | |||||||
Stock repurchase program, increase to the total authorized amount | $ 100,000,000 | |||||||
Stock repurchase program, authorized amount | $ 150,000,000 | |||||||
Stock repurchase program, amount of stock repurchased | $ 49,000,000 |