Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 05, 2021 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-40276 | |
Entity Registrant Name | Semrush Holdings, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 84-4053265 | |
Entity Address, Address Line One | 800 Boylston Street, Suite 2475 | |
Entity Address, City or Town | Boston | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 02199 | |
City Area Code | (800) | |
Local Phone Number | 851-9959 | |
Title of 12(b) Security | Class A Common Stock, $0.00001 par value per share | |
Trading Symbol | SEMR | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001831840 | |
Current Fiscal Year End Date | --12-31 | |
Class A Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 22,297,119 | |
Class B Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 114,243,239 |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash and cash equivalents | $ 188,510 | $ 35,531 |
Accounts receivable | 2,139 | 1,399 |
Deferred contract costs, current portion | 5,904 | 4,049 |
Prepaid expenses and other current assets | 6,574 | 2,649 |
Total current assets | 203,127 | 43,628 |
Property and equipment, net | 8,391 | 2,968 |
Intangible assets, net | 2,111 | 2,231 |
Goodwill | 1,991 | 1,991 |
Deferred contract costs, net of current portion | 2,201 | 1,670 |
Other long-term assets | 972 | 2,470 |
Total assets | 218,793 | 54,958 |
Current liabilities | ||
Accounts payable | 5,196 | 8,654 |
Accrued expenses | 22,285 | 7,719 |
Deferred revenue | 36,051 | 26,537 |
Other current liabilities | 1,877 | 0 |
Total current liabilities | 65,409 | 42,910 |
Long-term liabilities | ||
Deferred revenue, net of current portion | 243 | 123 |
Deferred tax liability | 126 | 209 |
Other long-term liabilities | 2,960 | 497 |
Total liabilities | 68,738 | 43,739 |
Commitments and contingencies (Note 11) | ||
Stockholders' equity (deficit) | ||
Common stock | 0 | 0 |
Additional paid-in capital | 185,292 | 4,975 |
Accumulated deficit | (35,238) | (35,815) |
Total stockholders’ equity (deficit) | 150,055 | (6,840) |
Total liabilities, redeemable convertible preferred stock, and stockholders' equity (deficit) | 218,793 | 54,958 |
Series A redeemable convertible preferred stock | ||
Long-term liabilities | ||
Redeemable convertible preferred stock | 0 | 7,789 |
Series A-1 redeemable convertible preferred stock | ||
Long-term liabilities | ||
Redeemable convertible preferred stock | 0 | 10,270 |
Series B convertible preferred stock | ||
Stockholders' equity (deficit) | ||
Preferred stock | 0 | 24,000 |
Undesignated preferred stock | ||
Stockholders' equity (deficit) | ||
Preferred stock | 0 | 0 |
Class A Common Stock | ||
Stockholders' equity (deficit) | ||
Common stock | 0 | 0 |
Class B Common Stock | ||
Stockholders' equity (deficit) | ||
Common stock | $ 1 | $ 0 |
UNAUDITED CONDENSED CONSOLIDA_2
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Preferred stock, par value (in USD per share) | $ 0.00001 | |
Preferred stock, authorized (in shares) | 100,000,000 | |
Common stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Common stock, authorized (in shares) | 0 | 300,000,000 |
Common stock, issued (in shares) | 0 | 95,206,893 |
Common stock, outstanding (in shares) | 0 | 95,050,041 |
Series A redeemable convertible preferred stock | ||
Redeemable convertible preferred stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Redeemable convertible preferred stock, authorized (in shares) | 0 | 3,379,400 |
Redeemable convertible preferred stock, issued (in shares) | 0 | 3,379,400 |
Redeemable convertible preferred stock, outstanding (in shares) | 0 | 3,379,400 |
Redeemable convertible preferred stock, liquidation value | $ 8,000 | |
Series A-1 redeemable convertible preferred stock | ||
Redeemable convertible preferred stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Redeemable convertible preferred stock, authorized (in shares) | 0 | 1,837,600 |
Redeemable convertible preferred stock, issued (in shares) | 0 | 1,837,600 |
Redeemable convertible preferred stock, outstanding (in shares) | 0 | 1,837,600 |
Redeemable convertible preferred stock, liquidation value | $ 5,000 | |
Series B convertible preferred stock | ||
Preferred stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, authorized (in shares) | 0 | 4,681,400 |
Preferred stock, issued (in shares) | 0 | 4,681,400 |
Preferred stock, outstanding (in shares) | 0 | 4,681,400 |
Preferred stock, liquidation value | $ 24,000 | |
Undesignated preferred stock | ||
Preferred stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, authorized (in shares) | 100,000,000 | 0 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Class A Common Stock | ||
Common stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Common stock, authorized (in shares) | 1,000,000,000 | 0 |
Common stock, issued (in shares) | 21,986,619 | 0 |
Common stock, outstanding (in shares) | 21,986,619 | 0 |
Class B Common Stock | ||
Common stock, par value (in USD per share) | $ 0.00001 | $ 0.00001 |
Common stock, authorized (in shares) | 160,000,000 | 0 |
Common stock, issued (in shares) | 114,210,869 | 0 |
Common stock, outstanding (in shares) | 114,105,779 | 0 |
UNAUDITED CONDENSED CONSOLIDA_3
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Statement [Abstract] | ||||
Revenue | $ 49,252 | $ 32,196 | $ 134,255 | $ 88,435 |
Cost of revenue | 11,362 | 7,731 | 30,373 | 21,397 |
Gross profit | 37,890 | 24,465 | 103,882 | 67,038 |
Operating expenses | ||||
Sales and marketing | 20,674 | 14,085 | 55,428 | 39,668 |
Research and development | 6,174 | 4,204 | 17,497 | 12,441 |
General and administrative | 11,372 | 6,931 | 29,796 | 19,426 |
Total operating expenses | 38,220 | 25,220 | 102,721 | 71,535 |
(Loss) income from operations | (330) | (755) | 1,161 | (4,497) |
Other expense, net | (184) | (105) | (256) | (194) |
(Loss) income before income taxes | (514) | (860) | 905 | (4,691) |
Provision for income taxes | 101 | 176 | 328 | 384 |
Net (loss) income and comprehensive (loss) income | $ (615) | $ (1,036) | $ 577 | $ (5,075) |
Net (loss) income per share attributable to common stockholders: | ||||
Basic (usd per share) | $ 0 | $ (0.01) | $ 0 | $ (0.05) |
Diluted (usd per share) | $ 0 | $ (0.01) | $ 0 | $ (0.05) |
Weighted-average number of shares of common stock used in computing net (loss) income per share attributable to common stockholders: | ||||
Basic (shares) | 135,673 | 94,834 | 122,595 | 94,722 |
Diluted (shares) | 135,673 | 94,834 | 138,639 | 94,722 |
UNAUDITED CONDENSED CONSOLIDA_4
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Series A | Series A-1 | Series BPreferred Stock | Class A Common StockCommon Stock | Class B Common StockCommon Stock |
Beginning balance (in shares) at Dec. 31, 2019 | 3,379,400 | 1,837,600 | |||||||
Beginning balance at Dec. 31, 2019 | $ 7,789 | $ 10,270 | |||||||
Ending balance (in shares) at Mar. 31, 2020 | 3,379,400 | 1,837,600 | |||||||
Ending balance at Mar. 31, 2020 | $ 7,789 | $ 10,270 | |||||||
Beginning balance (in shares) at Dec. 31, 2019 | 94,592,700 | 4,681,400 | 0 | 0 | |||||
Beginning balance at Dec. 31, 2019 | $ (1,159) | $ 0 | $ 3,644 | $ (28,803) | $ 24,000 | $ 0 | $ 0 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation expense | 205 | 205 | |||||||
Net income (loss) | (1,931) | (1,931) | |||||||
Ending balance (in shares) at Mar. 31, 2020 | 94,592,700 | 4,681,400 | 0 | 0 | |||||
Ending balance at Mar. 31, 2020 | (2,885) | $ 0 | 3,849 | (30,734) | $ 24,000 | $ 0 | $ 0 | ||
Beginning balance (in shares) at Dec. 31, 2019 | 3,379,400 | 1,837,600 | |||||||
Beginning balance at Dec. 31, 2019 | $ 7,789 | $ 10,270 | |||||||
Ending balance (in shares) at Sep. 30, 2020 | 3,379,400 | 1,837,600 | |||||||
Ending balance at Sep. 30, 2020 | $ 7,789 | $ 10,270 | |||||||
Beginning balance (in shares) at Dec. 31, 2019 | 94,592,700 | 4,681,400 | 0 | 0 | |||||
Beginning balance at Dec. 31, 2019 | (1,159) | $ 0 | 3,644 | (28,803) | $ 24,000 | $ 0 | $ 0 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | (5,075) | ||||||||
Ending balance (in shares) at Sep. 30, 2020 | 94,592,700 | 4,681,400 | 0 | 0 | |||||
Ending balance at Sep. 30, 2020 | (5,562) | $ 0 | 4,316 | (33,878) | $ 24,000 | $ 0 | $ 0 | ||
Beginning balance (in shares) at Mar. 31, 2020 | 3,379,400 | 1,837,600 | |||||||
Beginning balance at Mar. 31, 2020 | $ 7,789 | $ 10,270 | |||||||
Ending balance (in shares) at Jun. 30, 2020 | 3,379,400 | 1,837,600 | |||||||
Ending balance at Jun. 30, 2020 | $ 7,789 | $ 10,270 | |||||||
Beginning balance (in shares) at Mar. 31, 2020 | 94,592,700 | 4,681,400 | 0 | 0 | |||||
Beginning balance at Mar. 31, 2020 | (2,885) | $ 0 | 3,849 | (30,734) | $ 24,000 | $ 0 | $ 0 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation expense | 209 | 209 | |||||||
Net income (loss) | (2,108) | (2,108) | |||||||
Ending balance (in shares) at Jun. 30, 2020 | 94,592,700 | 4,681,400 | 0 | 0 | |||||
Ending balance at Jun. 30, 2020 | (4,784) | $ 0 | 4,058 | (32,842) | $ 24,000 | $ 0 | $ 0 | ||
Ending balance (in shares) at Sep. 30, 2020 | 3,379,400 | 1,837,600 | |||||||
Ending balance at Sep. 30, 2020 | $ 7,789 | $ 10,270 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation expense | 258 | 258 | |||||||
Net income (loss) | (1,036) | (1,036) | |||||||
Ending balance (in shares) at Sep. 30, 2020 | 94,592,700 | 4,681,400 | 0 | 0 | |||||
Ending balance at Sep. 30, 2020 | (5,562) | $ 0 | 4,316 | (33,878) | $ 24,000 | $ 0 | $ 0 | ||
Beginning balance (in shares) at Dec. 31, 2020 | 3,379,400 | 1,837,600 | |||||||
Beginning balance at Dec. 31, 2020 | $ 7,789 | $ 10,270 | |||||||
Increase (Decrease) in Temporary Equity [Roll Forward] | |||||||||
Conversion of Preferred Stock (in shares) | (3,379,400) | (1,837,600) | |||||||
Conversion of Preferred Stock | $ (7,789) | $ (10,270) | |||||||
Ending balance (in shares) at Mar. 31, 2021 | 0 | 0 | |||||||
Ending balance at Mar. 31, 2021 | $ 0 | $ 0 | |||||||
Beginning balance (in shares) at Dec. 31, 2020 | 95,050,041 | 4,681,400 | 0 | 0 | |||||
Beginning balance at Dec. 31, 2020 | (6,840) | $ 0 | 4,975 | (35,815) | $ 24,000 | $ 0 | $ 0 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation expense | 593 | 593 | |||||||
Conversion of preferred and common stock (in shares) | 29,695,200 | (4,681,400) | |||||||
Conversion of Preferred Stock | 18,058 | 42,058 | $ (24,000) | ||||||
Issuance of Class A Common Stock in connection with the Initial Public Offering, net of issuance costs (in shares) | 10,000,000 | ||||||||
Issuance of Class A Common Stock in connection with the Initial Public Offering, net of issuance costs | 126,622 | 126,622 | |||||||
Reclassification of Common Stock to Class B Common Stock in connection with the Initial Public Offering (in shares) | (124,745,241) | 124,745,241 | |||||||
Reclassification of Common Stock to Class B Common Stock in connection with the initial public offering | 0 | (1) | $ 1 | ||||||
Exercise of stock options (in shares) | 3,861 | ||||||||
Exercise of stock options | 7 | 7 | |||||||
Net income (loss) | 1,471 | 1,471 | |||||||
Ending balance (in shares) at Mar. 31, 2021 | 0 | 0 | 10,000,000 | 124,749,102 | |||||
Ending balance at Mar. 31, 2021 | 139,911 | $ 0 | 174,254 | (34,344) | $ 0 | $ 0 | $ 1 | ||
Beginning balance (in shares) at Dec. 31, 2020 | 3,379,400 | 1,837,600 | |||||||
Beginning balance at Dec. 31, 2020 | $ 7,789 | $ 10,270 | |||||||
Ending balance (in shares) at Sep. 30, 2021 | 0 | 0 | |||||||
Ending balance at Sep. 30, 2021 | $ 0 | $ 0 | |||||||
Beginning balance (in shares) at Dec. 31, 2020 | 95,050,041 | 4,681,400 | 0 | 0 | |||||
Beginning balance at Dec. 31, 2020 | $ (6,840) | $ 0 | 4,975 | (35,815) | $ 24,000 | $ 0 | $ 0 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Exercise of stock options (in shares) | 577,153 | ||||||||
Net income (loss) | $ 577 | ||||||||
Ending balance (in shares) at Sep. 30, 2021 | 0 | 0 | 21,986,619 | 114,105,779 | |||||
Ending balance at Sep. 30, 2021 | 150,055 | $ 0 | 185,292 | (35,238) | $ 0 | $ 0 | $ 1 | ||
Beginning balance (in shares) at Mar. 31, 2021 | 0 | 0 | |||||||
Beginning balance at Mar. 31, 2021 | $ 0 | $ 0 | |||||||
Ending balance (in shares) at Jun. 30, 2021 | 0 | 0 | |||||||
Ending balance at Jun. 30, 2021 | $ 0 | $ 0 | |||||||
Beginning balance (in shares) at Mar. 31, 2021 | 0 | 0 | 10,000,000 | 124,749,102 | |||||
Beginning balance at Mar. 31, 2021 | 139,911 | $ 0 | 174,254 | (34,344) | $ 0 | $ 0 | $ 1 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation expense | 569 | 569 | |||||||
Conversion of preferred and common stock (in shares) | 81,102 | (81,102) | |||||||
Issuance of Class A Common Stock in connection with the Initial Public Offering, net of issuance costs (in shares) | 719,266 | ||||||||
Issuance of Class A Common Stock in connection with the Initial Public Offering, net of issuance costs | 9,245 | 9,245 | |||||||
Exercise of stock options (in shares) | 28,442 | ||||||||
Exercise of stock options | 19 | 19 | |||||||
Net income (loss) | (279) | (279) | |||||||
Ending balance (in shares) at Jun. 30, 2021 | 0 | 0 | 10,800,368 | 124,696,442 | |||||
Ending balance at Jun. 30, 2021 | 149,465 | $ 0 | 184,087 | (34,623) | $ 0 | $ 0 | $ 1 | ||
Ending balance (in shares) at Sep. 30, 2021 | 0 | 0 | |||||||
Ending balance at Sep. 30, 2021 | $ 0 | $ 0 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation expense | 627 | 627 | |||||||
Conversion of preferred and common stock (in shares) | 11,186,251 | (11,186,251) | |||||||
Exercise of stock options (in shares) | 543,826 | ||||||||
Exercise of stock options | 578 | 578 | |||||||
Vesting of Class B Common Stock in connection with Restricted Stock Awards (in shares) | 51,762 | ||||||||
Net income (loss) | (615) | (615) | |||||||
Ending balance (in shares) at Sep. 30, 2021 | 0 | 0 | 21,986,619 | 114,105,779 | |||||
Ending balance at Sep. 30, 2021 | $ 150,055 | $ 0 | $ 185,292 | $ (35,238) | $ 0 | $ 0 | $ 1 |
UNAUDITED CONDENSED CONSOLIDA_5
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | |
Underwriting discounts, commissions and offering expenses | $ 0 | $ 658 | ||
Class A Common Stock | ||||
Underwriting discounts, commissions and offering expenses | $ 825 | $ 13,378 |
UNAUDITED CONDENSED CONSOLIDA_6
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Operating Activities | ||
Net income (loss) | $ 577 | $ (5,075) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities | ||
Depreciation and amortization expense | 2,438 | 848 |
Amortization of deferred contract costs | 4,578 | 3,435 |
Stock-based compensation expense | 1,789 | 670 |
Non-cash interest expense | 158 | 0 |
Deferred taxes | (83) | (95) |
Deposit on letter of credit | 88 | 0 |
Other long-term liabilities | 0 | 497 |
Changes in operating assets and liabilities | ||
Accounts receivable | (741) | 553 |
Deferred contract costs | (6,964) | (4,700) |
Prepaid expenses and other current assets | (3,924) | (761) |
Accounts payable | (3,219) | 273 |
Accrued expenses | 14,419 | 2,304 |
Deferred revenue | 9,634 | 3,825 |
Net cash provided by operating activities | 18,750 | 1,774 |
Investing Activities | ||
Purchases of property and equipment | (1,558) | (1,911) |
Purchases of convertible debt securities | (500) | 0 |
Capitalization of internal-use software development costs | (433) | (992) |
Cash paid for acquisition of business, net of cash acquired | (350) | (3,181) |
Net cash used in investing activities | (2,841) | (6,084) |
Financing Activities | ||
Proceeds from exercise of stock options | 604 | 245 |
Net proceeds from completing initial public offering | 137,467 | 0 |
Payment of capital leases | (913) | 0 |
Payment of deferred offering costs | 0 | (658) |
Net cash provided by (used in) financing activities | 137,158 | (413) |
Increase in cash, cash equivalents and restricted cash | 153,067 | (4,723) |
Cash, cash equivalents and restricted cash, at beginning of period | 35,619 | 37,523 |
Cash, cash equivalents and restricted cash, at end of period | 188,686 | 32,800 |
Supplemental cash flow disclosures | ||
Cash paid for interest | 193 | 0 |
Cash paid for income taxes | 201 | 555 |
Acquisition of fixed asset under capital lease | $ 5,750 | $ 0 |
Overview and Basis of Presentat
Overview and Basis of Presentation | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Overview and Basis of Presentation | Overview and Basis of Presentation Description of Business Semrush Holdings, Inc. (“Semrush Holdings”) and its subsidiaries (together the “Group”, the “Company”, or “Semrush”) provide an online visibility management software-as-a-service (“SaaS”) platform. The Company’s platform enables its subscribers to improve their online visibility and drive traffic, including on their websites and social media pages, and distribute highly relevant content to their customers on a targeted basis across various channels to drive high-quality traffic and measure the effectiveness of their digital marketing campaigns. The Company is headquartered in Boston, Massachusetts, and has wholly owned subsidiaries in Cyprus, Russia, the Czech Republic, Poland, and the United States. The Company is subject to a number of risks and uncertainties common to companies in similar industries and stages of development that could affect future operations and financial performance. These risks include, but are not limited to, rapid technological change, competitive pressure from substitute products or larger companies, protection of proprietary technology, management of international activities, the need to obtain additional financing to support growth, and dependence on third parties and key individuals. 2019 Reorganization On December 19, 2019, Semrush Holdings was incorporated in the state of Delaware and entered into a Contribution and Exchange Agreement with SEMrush CY Ltd (“SEMrush CY”) (a private limited liability company organized under the Cyprus Companies Law, Cap 113), pursuant to which the holders of all outstanding shares of capital stock of SEMrush CY contributed those shares to Semrush Holdings in exchange for identical shares of capital stock of Semrush Holdings (the “2019 Share Exchange”). Upon the 2019 Share Exchange, Semrush Holdings became the holding company of SEMrush CY and its wholly owned subsidiaries and the historical consolidated financial statements of SEMrush CY became the historical consolidated financial statements of Semrush Holdings. The 2019 Share Exchange and related transactions were completed on December 27, 2019. Initial Public Offering On March 29, 2021, the Company closed its initial public offering (“IPO”) in which it sold 10,000,000 shares of its Class A common stock at a price to the public of $14.00 per share. The Company received $126.6 million in net proceeds after deducting approximately $13.4 million for underwriting discounts, commissions and offering expenses. Immediately prior to the completion of the IPO, all shares of common stock then outstanding were reclassified as Class B common stock, and all shares of redeemable convertible preferred stock and convertible preferred stock then outstanding were converted into shares of common stock on a one-to-one basis and then reclassified into Class B common stock. On April 20, 2021, the underwriters of the Company’s IPO partially exercised their option to purchase additional shares of Class A common stock. In connection with the closing of the partial exercise on April 23, 2021, the underwriters purchased 719,266 shares of the Company’s Class A common stock for net proceeds to the Company of $9.2 million after deducting approximately $0.8 million for underwriting discounts, commissions, and offering expenses. Effects of COVID-19 The Company considered the potential effects of the novel strain of coronavirus (“COVID-19”) pandemic on the Company. In March 2020, the World Health Organization declared the outbreak of COVID-19 a pandemic, and numerous new strains of COVID-19 have subsequently spread throughout the world. COVID-19 has continued to impact market and economic conditions globally. In an attempt to limit the spread of the virus, various governmental restrictions have been implemented, including restrictions with respect to business activities and travel restrictions, and “shelter–at–home” orders, that have had and may continue to have an adverse impact on the Company’s business and operations. In light of the evolving nature of COVID-19 and the uncertainty it has produced around the world, it is not possible to predict the COVID-19 pandemic’s cumulative and ultimate impact on the Company’s future business operations, results of operations, financial position, liquidity, and cash flows. The extent of the impact of the pandemic on the Company’s business and financial results will depend largely on future developments, including the duration of the spread of the outbreak both globally and within the U.S., the impact on capital, foreign currencies exchange and financial markets, and governmental or regulatory orders that impact the Company’s business, all of which are highly uncertain and cannot be predicted. As of September 30, 2021, the Company has experienced long lead times for hardware affected by a semiconductor shortage attributed to the COVID-19 pandemic which may affect its ability to fully furnish the infrastructure within its data centers. The Company will continue to actively monitor the current international and domestic impacts of and responses to COVID-19 and its related risks. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”). The unaudited condensed consolidated interim financial statements have been prepared on the same basis as the audited annual consolidated financial statements as of and for the year ended December 31, 2020, and, in the opinion of management, reflect all adjustments, consisting of normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of September 30, 2021, and the results of its operations and its cash flows for the three and nine months ended September 30, 2021 and 2020. The consolidated balance sheet as of December 31, 2020 included herein was derived from the audited financial statements as of that date. The results for the three and nine months ended September 30, 2021 are not necessarily indicative of the results to be expected for the year ending December 31, 2021, any other interim periods, or any future year or period. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes included in the Company’s final prospectus dated March 24, 2021 (the “Prospectus”) as filed with the SEC on March 25, 2021 pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the “Securities Act”). |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Significant estimates relied upon in preparing these financial statements include, but are not limited to, revenue recognition, expected future cash flows used to evaluate the recoverability of long-lived assets, contingent liabilities, expensing and capitalization of research and development costs for internal-use software, the average period of benefit associated with costs capitalized to obtain revenue contracts, the determination of the fair value of stock-based awards issued, stock-based compensation expense, and the recoverability of the Company’s net deferred tax assets and related valuation allowance. Although the Company regularly assesses these estimates, actual results could differ materially from these estimates. Changes in estimates are recorded in the period in which they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Actual results may differ from management’s estimates if these results differ from historical experience, or other assumptions do not turn out to be substantially accurate, even if such assumptions are reasonable when made. Subsequent Events Considerations The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. The Company has evaluated all subsequent events and determined that there are no material recognized or unrecognized subsequent events requiring disclosure, other than those disclosed in this Quarterly Report on Form 10-Q. Emerging Growth Company Status The Company is an "emerging growth company," as defined in the Jumpstart Our Business Startups Act, or JOBS Act, and may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies." The Company may take advantage of these exemptions until the Company is no longer an "emerging growth company." Section 107 of the JOBS Act provides that an "emerging growth company" can take advantage of the extended transition period afforded by the JOBS Act for the implementation of new or revised accounting standards. The Company has elected to use the extended transition period for complying with new or revised accounting standards and, as a result of this election, its financial statements may not be comparable to companies that comply with public company effective dates. The Company may take advantage of these exemptions up until the last day of the year following the fifth anniversary of an offering or such earlier time that it is no longer an emerging growth company. The Company would cease to be an emerging growth company if it has more than $1.07 billion in annual revenue, has more than $700.0 million in market value of its stock held by non-affiliates (and it has been a public company for at least 12 months, and has filed one annual report on Form 10-K), or it issues more than $1.0 billion of non-convertible debt securities over a three-year period. Revenue Recognition The Company derives revenue from two sources: (1) subscription revenues via the Semrush Online Visibility Management Platform and the Prowly Public Relations Platform, which are comprised of subscription fees from customers accessing the Company’s SaaS services and related customer support; and (2) the Semrush Marketplace, which allows customers to pay a set fee for services or products offered through the marketplace. The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers (“ASC 606”). Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration it expects to receive in exchange for those products or services. There were no changes to the Company’s revenue recognition policies since the filing of the Prospectus. For the three and nine months ended September 30, 2021 and 2020, subscription revenue accounted for nearly all of the Company’s revenue. Revenue related to the Semrush Marketplace was not material for the three and nine months ended September 30, 2021 and 2020. Amounts that have been invoiced are recorded in accounts receivable and in deferred revenue or revenue, depending on whether the revenue recognition criteria have been met. The Company primarily invoices and collects payments from customers for its services in advance on a monthly or annual basis. Deferred revenue represents amounts billed for which revenue has not yet been recognized. Deferred revenue that will be recognized during the succeeding 12-month period is recorded as current deferred revenue, and the remaining portion is recorded as long-term deferred revenue. Deferred revenue increased by $9,634 as of September 30, 2021 compared December 31, 2020. During the three months ended September 30, 2021 and 2020, $18,504 and $11,672 of revenue was recognized that was included in deferred revenue at the beginning of each respective period. During the nine months ended September 30, 2021 and 2020, $22,874 and $17,343 of revenue was recognized that was included in deferred revenue at the beginning of each respective period. The Company has elected to exclude amounts charged to customers for sales tax from the transaction price. Accordingly, revenue is presented net of any sales tax collected from customers. Transaction Price Allocated to Future Performance Obligations ASC 606 requires that the Company disclose the aggregate amount of the transaction price that is allocated to performance obligations that have not yet been satisfied as of the balance sheet dates reported. For contracts with an original expected duration greater than one year, the aggregate amount of the transaction price allocated to the performance obligations that were unsatisfied as of September 30, 2021 and December 31, 2020 was $1,081 and $1,280, respectively, which the Company expects to recognize over the next 12 months. For contracts with an original expected duration of one year or less, the Company has applied the practical expedient available under ASC 606 to not disclose the amount of transaction price allocated to unsatisfied performance obligations as of September 30, 2021 and December 31, 2020. For performance obligations not satisfied as of September 30, 2021 and December 31, 2020, and to which this expedient applies, the nature of the performance obligations is consistent with performance obligations satisfied as of December 31, 2019. The remaining durations are less than one year. Costs to Obtain a Contract The incremental direct costs of obtaining a contract, which primarily consist of sales commissions paid for new subscription contracts, are deferred and recorded as deferred contract costs in the consolidated balance sheet and are amortized over a period of approximately 24 months on a systematic basis, consistent with the pattern of transfer of the goods or services to which the asset relates. The 24-month period represents the estimated benefit period of the customer relationship and has been determined by taking into consideration the type of product sold, the commitment term of the customer contract, the nature of the Company’s technology development life-cycle, and an estimated customer relationship period based on historical experience and future expectations. Sales commissions for renewals and upgrade contracts are deferred and amortized on a straight-line basis over the remaining estimated customer relationship period of the related customer. Deferred contract costs that will be recorded as expense during the succeeding 12-month period are recorded as current deferred contract costs, and the remaining portion is recorded as deferred contract costs, net of current portion. Amortization of deferred contract costs is included in sales and marketing expense in the accompanying consolidated statement of operations and comprehensive income (loss). Cash, Cash Equivalents, and Restricted Cash The Company considers all highly liquid instruments purchased with an original maturity date of 90 days or less from the date of purchase to be cash equivalents. Management determines the appropriate classification of investments at the time of purchase and re-evaluates such determination at each balance sheet date. Cash and cash equivalents consist of cash on deposit with banks and amounts held in interest-bearing money market funds. Cash equivalents are carried at cost, which approximates their fair market value. At September 30, 2021 and December 31, 2020, restricted cash was $176 and $88, respectively, and related to cash held at a financial institution in an interest-bearing cash account as collateral for a letter of credit related to the contractual provisions for one of the Company’s building leases. The following table is a reconciliation of cash, cash equivalents and restricted cash included in the accompanying condensed consolidated balance sheets that sum to the total cash, cash equivalents and restricted cash included in the accompanying condensed consolidated statements of cash flows for the nine months ended September 30, 2021 and 2020. September 30, 2021 September 30, 2020 Cash and cash equivalents $ 188,510 $ 32,712 Restricted cash included in “other long-term assets” 176 88 Total cash, cash equivalents and restricted cash, at end of period $ 188,686 $ 32,800 Concentrations of Credit Risk and Significant Customers The Company has no off-balance sheet risk, such as foreign exchange contracts, option contracts, or other hedging arrangements. Credit losses historically have not been significant and the Company generally has not experienced any material losses related to receivables from individual customers, or groups of customers. Due to these factors, no additional credit risk beyond amounts provided for collection losses is believed by management to be probable in the Company's accounts receivable. Credit risk with respect to accounts receivable is dispersed due to the large number of customers of the Company. The Company routinely assesses the creditworthiness of its customers and generally does not require its customers to provide collateral or other security to support accounts receivable. Credit losses historically have not been significant and the Company generally has not experienced any material losses related to receivables from individual customers, or groups of customers. Due to these factors, no additional credit risk beyond amounts provided for collection losses is believed by management to be probable in the Company's accounts receivable. As of September 30, 2021 and December 31, 2020, no individual customer represented more than 10% of the Company’s accounts receivable. During the three and nine months ended September 30, 2021 and 2020, no individual customer represented more than 10% of the Company’s revenue. Disclosure of Fair Value of Financial Instruments The carrying amounts of the Company’s financial instruments, which include cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses, approximated their fair values at September 30, 2021 and December 31, 2020, due to the short-term nature of these instruments. The Company has evaluated the estimated fair value of financial instruments using available market information. The use of different market assumptions and/or estimation methodologies could have a significant effect on the estimated fair value amounts. See below for further discussion. Fair Value Measurements ASC 820, Fair Value Measurements and Disclosures (“ASC 820”), establishes a three-level valuation hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). Observable inputs are those that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. This guidance further identifies fair value as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. The Company uses valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows: Level 1 inputs—Unadjusted observable quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 inputs—Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 inputs—Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The Company evaluates assets and liabilities subject to fair value measurements on a recurring and nonrecurring basis to determine the appropriate level to classify them for each reporting period. Cash equivalents include money market funds with original maturities of 90 days or less from the date of purchase. The fair value measurement of these assets is based on quoted market prices in active markets for identical assets and, therefore, these assets are recorded at fair value on a recurring basis and classified as Level 1 in the fair value hierarchy. As of September 30, 2021 and December 31, 2020, cash equivalents held in money market funds totaled $21,727 and $29,369, respectively. As of September 30, 2021, the Company measured its investments in convertible notes (see Note 4) and its contingent consideration associated with the acquisition of Prowly.com sp. z o.o (“Prowly”) on a recurring basis using significant unobservable inputs (Level 3) and did not have any assets or liabilities measured at fair value on a recurring basis using significant other observable inputs (Level 2). As of December 31, 2020, the Company’s only recurring Level 3 fair value measurement was its contingent consideration associated with the acquisition of Prowly. Changes in fair value of the convertible notes were not material for the three and nine months ended September 30, 2021. The changes in fair value of the contingent consideration associated with the Prowly acquisition were insignificant for the nine months ended September 30, 2021. As of December 31, 2020, the Company did not have any assets or liabilities measured at fair value on a recurring basis using significant other observable inputs (Level 2). Foreign Currency Translation The Group operates in a multi-currency environment having transactions in such currencies as the U.S. dollar, Russian rubles, Czech koruna, euros, and others. The reporting currency of the Company is the U.S. dollar. The functional currency of the Company’s foreign subsidiaries is the U.S. dollar, with the exception of Prowly, where the functional currency is the local currency, the Zloty. The foreign currency translation adjustment as it relates to Prowly was immaterial for the three and nine months ended September 30, 2021 and 2020, respectively. For all other entities, foreign currency transactions are measured initially in the functional currency of the recording entity by use of the exchange rate in effect at that date. At each subsequent balance sheet date, foreign currency denominated assets and liabilities of these international subsidiaries are remeasured into U.S. dollars using the exchange rates in effect at the balance sheet date or historical rates, as appropriate. Any differences resulting from the remeasurement of foreign currency denominated assets and liabilities of the international subsidiaries to the U.S. dollar functional currency are recorded within other income (expense) in the unaudited condensed consolidated statement of operations and comprehensive loss. The foreign currency exchange loss included in other income for the three months ended September 30, 2021 and 2020 was $(57) and $(26), respectively, and $(66) and $(296) for the nine months ended September 30, 2021 and 2020, respectively. Net Income (Loss) Per Share Net income (loss) per share information is determined using the two-class method, which includes the weighted-average number of shares of common stock outstanding during the period and other securities that participate in dividends (a participating security). Prior to the completion of the IPO, the Company considered the shares of Preferred Stock to be participating securities because they include rights to participate in dividends with the common stock. As of September 30, 2021, the Company did not have any participating securities outstanding. Under the two-class method, basic net income (loss) per share attributable to common stockholders is computed by dividing the net income (loss) attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. Diluted net income (loss) per share attributable to common stockholders is computed using the more dilutive of (1) the two-class method or (2) the if-converted method. The Company allocates net income first to preferred stockholders based on dividend rights under the Company’s certificate of incorporation and then to preferred and common stockholders based on ownership interests. Net losses are not allocated to preferred stockholders as they do not have an obligation to share in the Company’s net losses. During the nine months ended September 30, 2021, the Company amended its certificate of incorporation to create two classes of common stock outstanding: Class A common stock and Class B common stock. As more fully described in Note 9, the rights of the holders of Class A and Class B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock is entitled to one (1) vote per share and each share of Class B common stock is entitled to ten (10) votes per share. Each share of Class B common stock is convertible into one share of Class A common stock at the option of the holder at any time. Shares of Class B common stock are automatically converted into Class A common stock upon sale or transfer, subject to certain limited exceptions. Shares of Class A common stock are not convertible. See Note 9 to these unaudited condensed consolidated financial statements for additional information regarding the current conversion and transfer terms of the Company’s common stock. The Company allocates undistributed earnings attributable to common stock between the common stock classes on a one to one basis when computing net income (loss) per share. As a result, basic and diluted net income (loss) per share of Class A common stock and share of Class B common stock are equivalent. Diluted net income (loss) per share gives effect to all potentially dilutive securities. Potential dilutive securities consist of shares of common stock issuable upon the exercise of stock options, shares of common stock issuable upon the conversion of the outstanding shares of Preferred Stock, and shares of common stock issuable upon the vesting of restricted stock awards (RSAs) or restricted stock units (RSUs). For the three months ended September 30, 2021 and the three and nine months ended September 30, 2020, the dilutive effect of common stock equivalents has been excluded from the calculation of diluted net loss per share as their effect would have been anti-dilutive due to the net losses incurred for these periods. The following table presents a reconciliation of the weighted-average shares outstanding used in the calculation of basic and diluted net income (loss) per share: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Weighted-average shares outstanding: Weighted-average number of shares of common stock used in computing net income (loss) per share attributable to common stockholders—basic 135,673,000 94,834,000 122,595,000 94,722,000 Dilutive effect of share equivalents resulting from stock options — — 6,417,000 — Dilutive effect of share equivalents resulting from RSAs and RSUs — — 164,000 — Dilutive effect of shares issuable upon conversion of preferred stock — — 9,463,000 — Weighted-average number of shares of common stock used in computing net income (loss) per share attributable to common stockholders—diluted 135,673,000 94,834,000 138,639,000 94,722,000 The following potentially dilutive common stock equivalents have been excluded from the calculation of diluted weighted-average shares outstanding for the three and nine months ended September 30, 2021 and 2020: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Stock options outstanding 6,500,908 6,223,290 19,503 6,300,903 Shares of Preferred Stock — 29,695,200 — 29,695,200 Unvested RSAs and RSUs 140,793 — 23,723 — 6,641,701 35,918,490 43,226 35,996,103 Comprehensive income (loss) Comprehensive income (loss) is comprised of two components: net income (loss) and other comprehensive income (loss), which includes other changes in stockholders’ deficit that result from transactions and economic events other than those with stockholders. An immaterial cumulative translation adjustment related to the Prowly entity has been excluded from other comprehensive income for the three and nine months ended September 30, 2021. There were no components of other comprehensive income to report for the three and nine months ended September 30, 2020 and 2021; accordingly, comprehensive income (loss) equaled the total net income (loss) for all periods presented. Recent Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) . ASU 2016-02 requires a lessee to recognize most leases on the balance sheet but recognize expenses on the income statement in a manner similar to current practice. The update states that a lessee will recognize a lease liability for the obligation to make lease payments and a right-to-use asset for the right to use the underlying assets for the lease term. Leases will continue to be classified as either financing or operating, with classification affecting the recognition, measurement, and presentation of expenses and cash flows arising from a lease. For public entities, ASU 2016-02 is effective for years beginning after December 15, 2019. For non-public companies, ASU 2016-02 is effective for fiscal years beginning after December 15, 2021 and interim periods in annual periods beginning after December 15, 2022. Early adoption is permitted. The Company plans to adopt this guidance in the year ended December 31, 2022. The Company is currently assessing the impact that adopting this guidance will have on its consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . ASU 2016-13 requires that credit losses be reported as an allowance using an expected losses model, representing the entity's current estimate of credit losses expected to be incurred. The accounting guidance currently in effect is based on an incurred loss model. ASU 2016-13 affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. ASU 2016-13 is effective for public entities for annual reporting periods beginning after December 15, 2019, including interim periods within those fiscal years. For non-public companies, ASU 2016-13 is effective for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The Company plans to adopt this guidance in the year ending December 31, 2023. The Company is currently evaluating ASU 2016-13 and the potential impact on its condensed consolidated financial statements and financial statement disclosures. In August 2018, the FASB issued ASU No. 2018-15, Intangible-Goodwill and Other Internal-Use Software (Subtopic 350-40) . ASU 2018-15 updates guidance regarding accounting for implementation costs associated with a cloud computing arrangement that is a service contract. The amendments under ASU 2018-15 are effective for public entities for years beginning after December 15, 2019, and interim periods within those years. For non-public companies, ASU 2081-15 is effective for annual reporting periods beginning after December 15, 2020, and interim periods within annual periods beginning after December 15, 2021, with early adoption permitted. The Company plans to adopt this guidance in the annual period ending December 31, 2021. The Company is currently assessing the impact that adopting this guidance will have on its condensed consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes – Simplifying the Accounting for Income Taxes . The new guidance simplifies the accounting for income taxes by removing several exceptions in the current standard and adding guidance to reduce complexity in certain areas, such as requiring that an entity reflect the effect of an enacted change in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. For public companies, the ASU is effective for years beginning after December 15, 2020, and interim periods within those years, with early adoption permitted. For non-public companies, the new standard is effective for years beginning after December 15, 2021, with early adoption permitted. The Company plans to adopt this guidance in the annual period ending December 31, 2022. The Company is currently assessing the impact that adopting this guidance will have on its condensed consolidated financial statements. |
Property and Equipment, Net
Property and Equipment, Net | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | Property and Equipment, Net Property and equipment consists of the following (in thousands): As of September 30, December 31, Computer equipment $ 4,152 $ 3,513 Furniture and office equipment 1,398 1,041 Leasehold improvements 1,029 667 Capital leases 5,750 — Total property and equipment 12,329 5,221 Less: accumulated depreciation and amortization (3,938) (2,253) Property and equipment, net $ 8,391 $ 2,968 Depreciation and amortization expense related to property and equipment was $813 and $1,947 for the three and nine months ended September 30, 2021, respectively, and $240 and $651 for the three and nine months ended September 30, 2020, respectively. |
Other Long-Term Assets
Other Long-Term Assets | 9 Months Ended |
Sep. 30, 2021 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Long-Term Assets | Other Long-Term Assets Deferred Offering Costs Deferred offering costs primarily consist of direct incremental legal and accounting fees relating to the IPO and to a credit facility. The deferred issuance costs relating to the IPO were offset against IPO proceeds upon the consummation of the Company’s offering. The deferred costs relating to the credit facility are being amortized to interest expense up through the maturity date of the facility. As of September 30, 2021 and December 31, 2020, the Company had deferred offering costs relating to the IPO of $0 and $1,839. As of September 30, 2021 and December 31, 2020, the Company had $473 and $630, respectively, in issuance costs relating to the credit facility. The issuance costs for the IPO and credit facility are classified in other long-term assets in the accompanying unaudited condensed consolidated balance sheets. Investments in Convertible Debt In January 2021, the Company purchased two convertible debt securities for a total aggregate investment of $500. Both investments mature on January 1, 2023 and receive interest at an annual rate of 6%. Interest accrues and becomes payable upon conversion of the convertible notes, or will be paid in connection with the repayment in full of the principal amount of such convertible notes. These convertible note investments are classified as available-for-sale securities and are classified in other long-term assets in the accompanying unaudited condensed consolidated balance sheets based on the maturity date. The Company accounts for these investments, along with the embedded derivatives associated with their conversion features, by utilizing the fair value option within ASC 825 and accounting for the entire hybrid instrument at fair value through earnings. Changes in fair value of the convertible notes were not material for the three and nine months ended September 30, 2021. |
Acquisitions, Acquired Intangib
Acquisitions, Acquired Intangible Assets, and Goodwill | 9 Months Ended |
Sep. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions, Acquired Intangible Assets, and Goodwill | Acquisitions, Acquired Intangible Assets, and Goodwill Acquisitions On August 27, 2020, the Company acquired 100% of the outstanding capital of Prowly for cash consideration of $3,317. In addition to the purchase consideration, the founders of Prowly are eligible to earn up to a maximum of $2,750 in aggregate additional consideration based on the satisfaction of certain earnings targets as defined in the purchase agreement. For the three and nine months ended September 30, 2021, the Company recognized compensation expense of $283 and $452, respectively, as compensation expense related to the additional consideration. Intangible Assets Intangible assets consisted of intangible assets resulting from the acquisition of Prowly and capitalized internal-use software development costs. Intangible assets consists of the following: As of September 30, 2021 Gross Net Carrying Accumulated Carrying Amount Amortization Amount Developed technology 1,194 (219) 975 Trade name 68 (25) 43 Capitalized internal-use software 1,997 (904) 1,093 Total as of September 30, 2021 $ 3,259 $ (1,148) $ 2,111 As of December 31, 2020 Gross Net Carrying Accumulated Carrying Amount Amortization Amount Developed technology 1,194 (66) 1,128 Trade name 68 (3) 65 Capitalized internal-use software 1,561 (523) 1,038 Total as of December 31, 2020 $ 2,823 $ (592) $ 2,231 During the three and nine months ended September 30, 2021, the Company capitalized $170 and $441, respectively, of software development costs, which are classified as intangible assets on the accompanying consolidated balance sheets. During the three and nine months ended September 30, 2020, the Company capitalized $292 and $895, respectively, of software development costs. The Company recorded amortization expense associated with its capitalized development costs of $123 and $382 for the three and nine months ended September 30, 2021, respectively. The Company recorded amortization expense associated with its capitalized development costs of $75 and $179 for the three and nine months ended September 30, 2020, respectively. As of September 30, 2021 and December 31, 2020, the capitalized internal-use software asset balances totaled $1,093 and $1,038, respectively. Amortization expense for acquired intangible assets was $55 and $171 for the three and nine months ended September 30, 2021. There was no amortization expense for acquired intangible assets for the three and nine months ended September 30, 2020. As of September 30, 2021, future amortization expense is expected to be as follows: Amount Remainder of 2021 $ 156 2022 559 2023 428 2024 199 2025 and thereafter 769 Total $ 2,111 Goodwill The was no change in the carrying value of goodwill of $1,991 from December 31, 2020 through September 30, 2021. |
Accrued expenses
Accrued expenses | 9 Months Ended |
Sep. 30, 2021 | |
Payables and Accruals [Abstract] | |
Accrued expenses | Accrued expenses Accrued expenses consist of the following: As of September 30, December 31, Employee compensation $ 9,309 $ 4,478 Vacation reserves 464 465 Other 12,512 2,776 Total accrued expenses $ 22,285 $ 7,719 The Other balances consist partially of hosting and marketing expenses. |
Revolving Credit Facility
Revolving Credit Facility | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
Revolving Credit Facility | Revolving Credit Facility Senior Secured Revolving Credit Facility On January 12, 2021, the Company executed a credit agreement with JPMorgan Chase Bank, N.A., in the form of a revolving credit facility, that consists of a $45.0 million revolving credit facility and a letter of credit sub-facility with an aggregate limit equal to the lesser of $5.0 million and the aggregate unused amount of the revolving commitments then in effect. The availability of the credit facility is subject to the borrowing base based on an advance rate of 400% multiplied by annualized retention applied to monthly recurring revenue. The credit facility has a maturity of three years and will mature on January 12, 2024. Borrowings under the credit facility bear interest at the Company’s option at (i) LIBOR, subject to a 0.50% floor, plus a margin, or (ii) the alternate base rate, subject to a 3.25% floor (or 1.50% prior to positive consolidated adjusted earnings before interest, taxes, depreciation, and amortization (“adjusted EBITDA”) for the twelve months most recently ended), plus a margin. For LIBOR borrowings, the applicable rate margin is 2.75% (or 3.50% prior to positive consolidated adjusted EBITDA as of the twelve months most recently ended). For base rate borrowings, the applicable margin is 0.00% (or 2.50% prior to positive consolidated adjusted EBITDA as of the twelve months most recently ended). The Company is also required to pay a 0.25% per annum fee on undrawn amounts under the Company’s revolving credit facility, payable quarterly in arrears. As of September 30, 2021, the Company has not drawn on this revolving credit facility. For the three and nine months ended September 30, 2021, the Company incurred $28 and $81 in interest expense, respectively, relating to this credit facility. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We are subject to U.S. federal, state, and foreign income taxes. For the three and nine months ended September 30, 2021, we recorded provisions for income taxes of $101 and $328, respectively. For the three and nine months ended September 30, 2020, we recorded provisions for income taxes of $176 and $384, respectively. Our effective tax rate for the nine months ended September 30, 2021 and 2020 differs from the U.S. statutory rate primarily due to the jurisdictional mix of earnings and the valuation allowance maintained against our net deferred tax assets. We recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities. These differences are measured using the enacted statutory tax rates that are expected to be in effect for the years in which differences are expected to reverse. On a periodic basis, we reassess any valuation allowances that we maintain on our deferred tax assets, weighing positive and negative evidence to assess the recoverability of the deferred tax assets. We maintain a valuation allowance on certain federal, state, and foreign tax attributes that are not more-likely-than-not realizable. |
Redeemable Convertible Preferre
Redeemable Convertible Preferred Stock and Stockholders’ Equity | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Redeemable Convertible Preferred Stock and Stockholders’ Equity | Redeemable Convertible Preferred Stock and Stockholders’ Equity Prior to the IPO, the authorized capital stock of the Company included 9,898,400 shares of preferred stock, of which 3,379,400 shares have been designated as Series A Redeemable Convertible Preferred Stock, 1,837,600 shares have been designated as Series A-1 Redeemable Convertible Preferred Stock and 4,681,400 shares have been designated as Series B Convertible Preferred Stock (collectively the “Preferred Stock”). Immediately prior to the closing of the IPO, the outstanding shares of Preferred Stock were converted on a three-for-one basis into 29,695,200 shares of common stock. The holders of the Company’s Preferred Stock had certain voting, dividend, and redemption rights, as well as liquidation preferences and conversion privileges. All rights, preferences, and privileges associated with the preferred stock were terminated at the time of the Company’s IPO in conjunction with the conversion of all outstanding shares of Preferred Stock into shares of common stock. As of September 30, 2021, the total number of shares of all classes of stock which the Company shall have authority to issue was (i) 1,000,000,000 shares of Class A common stock, par value $0.00001 per share, and (ii) 160,000,000 shares of Class B common stock, par value $0.00001 per share, and (iii) 100,000,000 undesignated shares of Preferred Stock, par value $0.00001 per share. Each share of Class A common stock entitles the holder to one vote for each share on all matters submitted to a vote of the Company's stockholders at all meetings of stockholders and written actions in lieu of meetings. Each share of Class B common stock entitles the holder to ten votes for each share on all matters submitted to a vote of the Company's stockholders at all meetings of stockholders and written actions in lieu of meetings. Holders of Class A common stock and Class B common stock are entitled to receive dividends, when and if declared by the board of directors (the “Board”). Each share of Class B common stock is convertible into one share of Class A common stock at the option of the holder at any time. Automatic conversion shall occur upon the occurrence of (i) a Transfer, as defined in the amended and restated certificate of incorporation, of such share of Class B common stock, (ii) the affirmative vote of at least two-thirds of the outstanding shares of Class B common stock, voting as a single class, or (iii) on or after the earlier to occur of (a) the seven Stock Split On March 15, 2021, the Board approved a 3-for-1 stock-split of the Company’s common stock. The stock split was approved by the stockholders on March 15, 2021 and became effective on March 15, 2021. Upon the effectiveness of the stock split, (i) every one share of common stock outstanding was increased to 3 shares of common stock, (ii) the number of shares of common stock into which each outstanding option to purchase common stock is exercisable was proportionally increased on a 3-for-1 basis, and (iii) the exercise price of each outstanding option to purchase common stock was proportionately decreased on a 3-for-1 basis. Additionally, shares of common stock reserved for issuance upon the conversion of the Company’s Preferred Stock were proportionately increased on a 3-for-1 basis and the respective conversion prices of the Preferred Stock were proportionately reduced. All share and per share data shown in the accompanying consolidated financial statements and related notes have been retroactively revised to reflect the stock split. Common Stock Reserved for Future Issuance As of September 30, 2021, the Company had reserved the following shares of common stock for future issuance: Options outstanding 7,064,945 Options reserved for future issuance 12,730,521 Restricted stock outstanding 156,852 Restricted stock units 164,487 Total authorized shares of common stock reserved for future issuance 20,116,805 |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based CompensationIn 2019, the Board adopted the Semrush Holdings, Inc. 2019 Stock Option and Grant Plan (the “2019 Plan”), which provides for the grant of qualified incentive stock options and nonqualified stock options or other awards, including restricted stock unit awards, to the Company’s employees, officers, directors, advisors, and outside consultants for the purchase of up to 8,682,600 shares of the Company’s common stock. In July 2020, the Plan was amended to provide for the grant of qualified incentive stock options and nonqualified stock options or other awards to the Company’s employees, officers, directors, advisors, and outside consultants for the purchase of up to 10,163,772 shares of the Company’s common stock. Stock options generally vest over a 4 year period and expire 10 years from the date of grant. Certain options provide for accelerated vesting if there is a change in control (as defined in the Plan). The Semrush Holdings, Inc. 2021 Stock Option and Incentive Plan (the “2021 Plan”) was adopted by the Board March 3, 2021 and approved by stockholders on March 15, 2021 and became effective immediately prior to the effectiveness of the Company’s registration statement in connection with its IPO. The 2021 Plan replaced the 2019 Plan as the Board determined not to make additional awards under the 2019 Plan following the pricing of the Company’s IPO. The 2021 Plan allows the compensation committee of the Board to make equity-based and cash-based incentive awards to the Company’s officers, employees, directors and other key persons (including consultants). The Company initially reserved 13,503,001 shares of Class A common stock for the issuance of awards under the 2021 Plan. The 2021 Plan provides that the number of shares reserved and available for issuance under the plan will automatically increase each January 1, beginning on January 1, 2022, by the lesser of 5% of the outstanding number of shares of Class A and Class B common stock on the immediately preceding December 31, or such lesser number of shares as determined by the compensation committee. This number is subject to adjustment in the event of a stock split, stock dividend or other change in our capitalization. The Company accounts for stock-based compensation in accordance with the provisions of ASC 718, which requires the recognition of expense related to the fair value of stock-based compensation awards in the statements of operations. For stock-based awards issued under the Company’s stock-based compensation plans to employees and members of the Board for their services on the Board, the fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model as discussed further below. For RSUs granted subject to service-based vesting conditions, the fair value is determined based on the closing price of the Company’s Class A common stock, as reported on the New York Stock Exchange on the date of grant. RSUs granted subject to service-based vesting conditions generally vest over a four-year requisite service period. For all other service-based awards, the Company recognizes compensation expense on a straight-line basis over the requisite service period of the award with actual forfeitures recognized as they occur. Given the absence of an active market for the Company’s common stock prior to the completion of the IPO, the Board, the members of which the Company believes have extensive business, finance, and venture capital experience, were required to estimate the fair value of the Company’s common stock at the time of each grant of a stock-based award. The Company and the Board utilized various valuation methodologies in accordance with the framework of the American Institute of Certified Public Accountants’ Technical Practice Aid, Valuation of Privately-Held Company Equity Securities Issued as Compensation, to estimate the fair value of its common stock. Each valuation methodology included estimates and assumptions that require the Company’s judgment. These estimates and assumptions include a number of objective and subjective factors, in determining the value of the Company’s common stock at each grant date, including the following factors: (1) prices paid for the Company’s Preferred Stock, which the Company had sold to outside investors in arm’s-length transactions, and the rights, preferences, and privileges of the Company’s Preferred Stock and common stock; (2) valuations performed by an independent valuation specialist; (3) the Company’s stage of development and revenue growth; (4) the fact that the grants of stock-based awards involved illiquid securities in a private company; and (5) the likelihood of achieving a liquidity event for the common stock underlying the stock-based awards, such as an IPO or sale of the Company, given prevailing market conditions. The Company believes this methodology to be reasonable based upon the Company’s internal peer company analyses, and further supported by several arm’s-length transactions involving the Company’s Preferred Stock. As the Company’s common stock is not actively traded, the determination of fair value involves assumptions, judgments, and estimates. If different assumptions were made, stock-based compensation expense, consolidated net income (loss) and consolidated net income (loss) per share could have been significantly different. The Company has recorded stock-based compensation expense of $627 and $1,789 during the three and nine months ended September 30, 2021, respectively, and recorded $258 and $672 for the three and nine months ended September 30, 2020, respectively. The following table shows stock-based compensation expense by where the stock-based compensation expense is recorded in the Company’s unaudited condensed consolidated statement of operations: Three Months Ended Nine Months Ended 2021 2020 2021 2020 Cost of revenue $ 7 $ 5 $ 22 $ 14 Sales and marketing 100 36 245 100 Research and development 68 29 204 86 General and administrative 452 188 1,318 472 Total stock-based compensation $ 627 $ 258 $ 1,789 $ 672 As of September 30, 2021, there was $4,780 of unrecognized compensation cost related to unvested common stock option arrangements granted under the 2021 Plan, which is expected to be recognized over a weighted-average period of 2.84 years. The fair value of each option award was estimated on the date of grant using the Black-Scholes option-pricing model. As there was no public market for its common stock prior to March 25, 2021, which was the first day of trading, and as the trading history of the Company’s common stock was limited through March 31, 2021, the Company determined the expected volatility for options granted based on an analysis of reported data for a peer group of companies that issued options with substantially similar terms. The expected volatility of options granted has been determined using an average of the historical volatility measures of this peer group of companies. The expected life of options granted to employees was calculated using the simplified method, which represents the average of the contractual term of the option and the weighted-average vesting period of the option. The Company uses the simplified method because it does not have sufficient historical option exercise data to provide a reasonable basis upon which to estimate expected term. The risk-free interest rate is based on a treasury instrument whose term is consistent with the expected life of the share option. The Company has not paid, nor anticipates paying, cash dividends on its ordinary shares; therefore, the expected dividend yield is assumed to be zero. The Company granted no options during the three months ended September 30, 2021. The weighted-average assumptions utilized to determine the fair value of options granted to employees are presented in the following table: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Expected volatility N/A 52.0 % 52.0 % 49.7 % Weighted-average risk-free interest rate N/A 0.33 % 1.04 % 0.80 % Expected dividend yield N/A — — — Expected life – in years N/A 6 6 6 A summary of the Company’s option activity as of September 30, 2021, which all occurred under the 2019 Plan and the 2021 Plan, and changes during the nine months then ended are as follows: Number of Options Weighted-Average Exercise Price (per share) Weighted-Average Remaining Contractual Term (in years) Outstanding at December 31, 2020 7,611,258 $ 1.37 8.40 Granted 229,053 12.37 Exercised (577,153) 1.18 Forfeited (198,213) 2.35 Outstanding at September 30, 2021 7,064,945 1.72 7.84 Options exercisable at September 30, 2021 3,346,067 1.02 7.99 The weighted-average grant-date fair value of options granted during the nine months ended September 30, 2021 was $6.13 per share. The weighted-average grant-date fair value of options granted during the three and nine months ended September 30, 2020 was $0.89 and $0.74 per share, respectively. No tax benefits were realized from options during the three and nine months ended September 30, 2021 or 2020. The aggregate intrinsic value of options outstanding as of September 30, 2021 and December 31, 2020 was $150,739 and $36,816, respectively. The aggregate intrinsic value for options exercised during the three and nine months ended September 30, 2021 was $11,918 and $12,410, respectively. The aggregate intrinsic value for options exercisable as of September 30, 2021 was $73,732. The aggregate intrinsic value was calculated based on the positive difference, if any, between the estimated fair value of the Company’s common stock on September 30, 2021 and December 31, 2020, respectively, or the date of exercise, as appropriate, and the exercise price of the underlying options. On July 28, 2020, the Company issued 156,852 shares of its restricted common stock (“Restricted Stock Issuance”) to the founders of Prowly for a total fair value of $291 under the 2019 Plan. This Restricted Stock Issuance vests over a three-year service period, applicable to both founders. As of September 30, 2021, 51,762 shares have vested in connection with this Restricted Stock Issuance. During the three and nine months ended September 30, 2021, the Company granted to employees RSU awards for 9,462 and 164,487 shares of Class A common stock under the 2021 Plan, respectively. The Company recorded stock-based compensation expense related to the RSU grants of $139 and $284, respectively. The Company granted no RSU awards during the nine months ended September 30, 2020; accordingly, there was no RSU compensation expense associated with this periods. A summary of RSU activity under the Company’s 2021 Plan for the nine months ended September 30, 2021 is as follows: Number of Shares Weighted-Average Grant Date Fair Value Aggregate Fair Value Unvested balance at January 1, 2021 — — Granted 164,487 11.48 $ 1,888 Vested — — Forfeited — — Unvested balance as of September 30, 2021 164,487 11.48 2021 Employee Stock Purchase Plan The Semrush Holdings, Inc. 2021 Employee Stock Purchase Plan (the “ESPP”) was adopted by the Board on March 3, 2021 and approved by stockholders on March 15, 2021 and became effective immediately prior to the effectiveness of the Company’s registration statement in connection with its IPO. The ESPP initially reserves and authorizes the issuance of up to a total of 3,000,667 shares of Class A common stock to participating employees. The ESPP provides that the number of shares reserved and available for issuance will automatically increase each January 1, beginning on January 1, 2022 and each January 1 thereafter through January 1, 2031, by the least of (i) 1% of the outstanding number of shares of Class A and Class B common stock on the immediately preceding December 31; (ii) 3,000,667 shares or (iii) such lesser number of shares of Class A common stock as determined by the ESPP administrator. The number of shares reserved under the ESPP is subject to adjustment in the event of a stock split, stock dividend or other change in our capitalization. The Company expects to offer, sell and issue shares of common stock under the ESPP from time to time based on various factors and conditions, although the Company is under no obligation to sell any shares under the ESPP. The Company has not issued any shares of Class A common stock under the ESPP. |
Commitment and Contingencies
Commitment and Contingencies | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company leases office facilities under noncancelable operating leases that expire at various dates through 2027. In addition, the Company has multi-year commitments with data centers. Some of these lease agreements contain escalating rent payments. Rent expense is recorded on a straight-line basis. Rent expense was $994 and $2,875 for the three and nine months ended September 30, 2021, respectively. Rent expense was $1,053 and $3,218 for the three and nine months ended September 30, 2020, respectively. The Company also has non-cancelable commitments related to its data centers. Future minimum amounts payable as of September 30, 2021, under the office facilities operating leases and data center agreements are as follows: Operating Leases Remainder of 2021 $ 1,052 2022 4,602 2023 2,956 2024 1,774 2025 and thereafter 2,938 Total minimum lease payments $ 13,322 During the year ended December 31, 2020, the Company entered into leasing arrangements for certain data center equipment under non-cancelable capital leases. The leasing arrangements have terms of 36 months beginning on the date the Company accepts the installation of the equipment subject to the lease. As of December 31, 2020, the equipment had not been installed and the Company had not accepted the equipment under these leases, and as such the lease commencement date had not begun. During the nine months ended September 30, 2021, a portion of the equipment was installed and the related lease commenced. The Company is required to make total payments of $6,496 over the term of the leases which is excluded from the table above. The Company recorded $4,837 in capital leases to property and equipment, net, as of September 30, 2021 (see Note 3), which is being depreciated over the lease term of 36 months. Of the $4,837 recorded in capital leases, $1,877 of the capital lease obligation is designated as current and $2,960 is designated as non-current on the unaudited condensed consolidated balance sheet as of September 30, 2021. In addition to the lease commitments above, the Company also has multi-year commitments with certain data providers. The Company is committed to spend approximately $1,602, $7,935, and $2,416 for the remainder of the year ending December 31, 2021, and for the years ending December 31, 2022, and 2023, respectively, for data providers. Litigation The Company, from time to time, may be party to litigation arising in the ordinary course of its business. The Company was not subject to any material legal proceedings during the three months ended September 30, 2021, and, to the best of its knowledge, no material legal proceedings are currently pending or threatened. Indemnification The Company typically enters into indemnification agreements with customers in the ordinary course of business. Pursuant to these agreements, the Company indemnifies and agrees to reimburse the indemnified party for losses suffered or incurred as a result of claims of intellectual property infringement. These indemnification agreements are provisions of the applicable customer agreement. Based on when clients first sign an agreement for the Company’s service, the maximum potential amount of future payments the Company could be required to make under certain of these indemnification agreements is unlimited. Based on historical experience and information known as of September 30, 2021, the Company has not incurred any costs for the above guarantees and indemnities. In certain circumstances, the Company warrants that its services will perform in all material respects in accordance with its standard published specification documentation in effect at the time of delivery of the services to the customer for the term of the agreement. To date, the Company has not incurred |
Components of Other Expense, Ne
Components of Other Expense, Net | 9 Months Ended |
Sep. 30, 2021 | |
Other Income and Expenses [Abstract] | |
Components of Other Expense, Net | Components of Other Expense, Net The components of other expense, net, are as follows: Three Months Ended Nine Months Ended 2021 2020 2021 2020 Foreign currency exchange loss (57) (26) (66) (296) Other, net (127) (79) (190) 102 Other expense, net $ (184) $ (105) $ (256) $ (194) |
Employee Benefit Plan
Employee Benefit Plan | 9 Months Ended |
Sep. 30, 2021 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | Employee Benefit PlanThe Company maintains a defined contribution savings plan under Section 401(k) of the Internal Revenue Code (the “401(k) Plan”) covering all U.S. employees who satisfy certain eligibility requirements. The 401(k) Plan allows each participant to defer a percentage of their eligible compensation subject to applicable annual limits pursuant to the limits established by the Internal Revenue Service. The Company may, at the discretion of the Board, make contributions in the form of matching contributions or profit-sharing contributions. For the three and nine months ended September 30, 2021, the Company made matching contributions of $160 and $384, respectively, to the 401(k) Plan. For the three and nine months ended September 30, 2020, the Company made matching contributions of $47 and $123, respectively, to the 401(k) Plan. |
Segment and Geographic Informat
Segment and Geographic Information | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | Segment and Geographic Information Disclosure requirements about segments of an enterprise and related information establishes standards for reporting information regarding operating segments in annual financial statements and requires selected information of those segments to be presented in interim financial reports issued to shareholders. Operating segments are defined as components of an enterprise about which separate discrete financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision maker is the chief executive officer. The Company and the chief executive officer view the Company’s operations and manage its business as one operating segment. Geographic Data The Company allocates, for the purpose of geographic data reporting, its revenue based upon the location of the customer. Total revenue by geographic area was as follows: Three Months Ended Nine Months Ended 2021 2020 2021 2020 Revenue: United States $ 22,317 $ 14,964 $ 61,038 $ 41,036 United Kingdom 5,164 3,399 14,064 9,427 Other 21,771 13,833 59,153 37,972 Total revenue $ 49,252 $ 32,196 $ 134,255 $ 88,435 Property and equipment, net by geographic location consists of the following: As of September 30, December 31, Property and equipment, net: United States $ 6,475 $ 1,023 Russia 1,440 1,450 Czech Republic 425 439 Other 51 56 Total assets $ 8,391 $ 2,968 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent EventsThe Company has completed an evaluation of all subsequent events after the balance sheet date of September 30, 2021 through the date this Quarterly Report on Form 10-Q was filed with the SEC, to ensure that this filing includes appropriate disclosure of events both recognized in the financial statements as of September 30, 2021, and events which occurred subsequently but were not recognized in the financial statements. The Company has concluded that no subsequent events have occurred that require disclosure, except as disclosed within these financial statements and except as disclosed below. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Any reference in these notes to applicable guidance is meant to refer to the authoritative United States generally accepted accounting principles as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”). The unaudited condensed consolidated interim financial statements have been prepared on the same basis as the audited annual consolidated financial statements as of and for the year ended December 31, 2020, and, in the opinion of management, reflect all adjustments, consisting of normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of September 30, 2021, and the results of its operations and its cash flows for the three and nine months ended September 30, 2021 and 2020. The consolidated balance sheet as of December 31, 2020 included herein was derived from the audited financial statements as of that date. The results for the three and nine months ended September 30, 2021 are not necessarily indicative of the results to be expected for the year ending December 31, 2021, any other interim periods, or any future year or period. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes included in the Company’s final prospectus dated March 24, 2021 (the “Prospectus”) as filed with the SEC on March 25, 2021 pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the “Securities Act”). |
Principles of Consolidation | Principles of Consolidation The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. Significant estimates relied upon in preparing these financial statements include, but are not limited to, revenue recognition, expected future cash flows used to evaluate the recoverability of long-lived assets, contingent liabilities, expensing and capitalization of research and development costs for internal-use software, the average period of benefit associated with costs capitalized to obtain revenue contracts, the determination of the fair value of stock-based awards issued, stock-based compensation expense, and the recoverability of the Company’s net deferred tax assets and related valuation allowance. Although the Company regularly assesses these estimates, actual results could differ materially from these estimates. Changes in estimates are recorded in the period in which they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Actual results may differ from management’s estimates if these results differ from historical experience, or other assumptions do not turn out to be substantially accurate, even if such assumptions are reasonable when made. |
Subsequent Events Considerations | Subsequent Events Considerations The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. The Company has evaluated all subsequent events and determined that there are no material recognized or unrecognized subsequent events requiring disclosure, other than those disclosed in this Quarterly Report on Form 10-Q. |
Revenue Recognition | Revenue Recognition The Company derives revenue from two sources: (1) subscription revenues via the Semrush Online Visibility Management Platform and the Prowly Public Relations Platform, which are comprised of subscription fees from customers accessing the Company’s SaaS services and related customer support; and (2) the Semrush Marketplace, which allows customers to pay a set fee for services or products offered through the marketplace. The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers (“ASC 606”). Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration it expects to receive in exchange for those products or services. There were no changes to the Company’s revenue recognition policies since the filing of the Prospectus. For the three and nine months ended September 30, 2021 and 2020, subscription revenue accounted for nearly all of the Company’s revenue. Revenue related to the Semrush Marketplace was not material for the three and nine months ended September 30, 2021 and 2020. Amounts that have been invoiced are recorded in accounts receivable and in deferred revenue or revenue, depending on whether the revenue recognition criteria have been met. The Company primarily invoices and collects payments from customers for its services in advance on a monthly or annual basis. Deferred revenue represents amounts billed for which revenue has not yet been recognized. Deferred revenue that will be recognized during the succeeding 12-month period is recorded as current deferred revenue, and the remaining portion is recorded as long-term deferred revenue. Deferred revenue increased by $9,634 as of September 30, 2021 compared December 31, 2020. During the three months ended September 30, 2021 and 2020, $18,504 and $11,672 of revenue was recognized that was included in deferred revenue at the beginning of each respective period. During the nine months ended September 30, 2021 and 2020, $22,874 and $17,343 of revenue was recognized that was included in deferred revenue at the beginning of each respective period. The Company has elected to exclude amounts charged to customers for sales tax from the transaction price. Accordingly, revenue is presented net of any sales tax collected from customers. Transaction Price Allocated to Future Performance Obligations ASC 606 requires that the Company disclose the aggregate amount of the transaction price that is allocated to performance obligations that have not yet been satisfied as of the balance sheet dates reported. For contracts with an original expected duration greater than one year, the aggregate amount of the transaction price allocated to the performance obligations that were unsatisfied as of September 30, 2021 and December 31, 2020 was $1,081 and $1,280, respectively, which the Company expects to recognize over the next 12 months. For contracts with an original expected duration of one year or less, the Company has applied the practical expedient available under ASC 606 to not disclose the amount of transaction price allocated to unsatisfied performance obligations as of September 30, 2021 and December 31, 2020. For performance obligations not satisfied as of September 30, 2021 and December 31, 2020, and to which this expedient applies, the nature of the performance obligations is consistent with performance obligations satisfied as of December 31, 2019. The remaining durations are less than one year. Costs to Obtain a Contract The incremental direct costs of obtaining a contract, which primarily consist of sales commissions paid for new subscription contracts, are deferred and recorded as deferred contract costs in the consolidated balance sheet and are amortized over a period of approximately 24 months on a systematic basis, consistent with the pattern of transfer of the goods or services to which the asset relates. The 24-month period represents the estimated benefit period of the customer relationship and has been determined by taking into consideration the type of product sold, the commitment term of the customer contract, the nature of the Company’s technology development life-cycle, and an estimated customer relationship period based on historical experience and future expectations. Sales commissions for renewals and upgrade contracts are deferred and amortized on a straight-line basis over the remaining estimated customer relationship period of the related customer. Deferred contract costs that will be recorded as expense during the succeeding 12-month period are recorded as current deferred contract costs, and the remaining portion is recorded as deferred contract costs, net of current portion. Amortization of deferred contract costs is included in sales and marketing expense in the accompanying consolidated statement of operations and comprehensive income (loss). |
Cash, Cash Equivalents, and Restricted Cash | Cash, Cash Equivalents, and Restricted Cash The Company considers all highly liquid instruments purchased with an original maturity date of 90 days or less from the date of purchase to be cash equivalents. Management determines the appropriate classification of investments at the time of purchase and re-evaluates such determination at each balance sheet date. |
Concentrations of Credit Risk and Significant Customers | Concentrations of Credit Risk and Significant Customers The Company has no off-balance sheet risk, such as foreign exchange contracts, option contracts, or other hedging arrangements. Credit losses historically have not been significant and the Company generally has not experienced any material losses related to receivables from individual customers, or groups of customers. Due to these factors, no additional credit risk beyond amounts provided for collection losses is believed by management to be probable in the Company's accounts receivable. |
Disclosure of Fair Value of Financial Instruments and Fair Value Measurements | Disclosure of Fair Value of Financial Instruments The carrying amounts of the Company’s financial instruments, which include cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses, approximated their fair values at September 30, 2021 and December 31, 2020, due to the short-term nature of these instruments. The Company has evaluated the estimated fair value of financial instruments using available market information. The use of different market assumptions and/or estimation methodologies could have a significant effect on the estimated fair value amounts. See below for further discussion. Fair Value Measurements ASC 820, Fair Value Measurements and Disclosures (“ASC 820”), establishes a three-level valuation hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs). Observable inputs are those that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. This guidance further identifies fair value as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. The Company uses valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows: Level 1 inputs—Unadjusted observable quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 inputs—Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 inputs—Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The Company evaluates assets and liabilities subject to fair value measurements on a recurring and nonrecurring basis to determine the appropriate level to classify them for each reporting period. Cash equivalents include money market funds with original maturities of 90 days or less from the date of purchase. The fair value measurement of these assets is based on quoted market prices in active markets for identical assets and, therefore, these assets are recorded at fair value on a recurring basis and classified as Level 1 in the fair value hierarchy. As of September 30, 2021 and December 31, 2020, cash equivalents held in money market funds totaled $21,727 and $29,369, respectively. As of September 30, 2021, the Company measured its investments in convertible notes (see Note 4) and its contingent consideration associated with the acquisition of Prowly.com sp. z o.o (“Prowly”) on a recurring basis using significant unobservable inputs (Level 3) and did not have any assets or liabilities measured at fair value on a recurring basis using significant other observable inputs (Level 2). As of December 31, 2020, the Company’s only recurring Level 3 fair value measurement was its contingent consideration associated with the acquisition of Prowly. Changes in fair value of the convertible notes were not material for the three and nine months ended September 30, 2021. The changes in fair value of the contingent consideration associated with the Prowly acquisition were insignificant for the nine months ended September 30, 2021. As of December 31, 2020, the Company did not have any assets or liabilities measured at fair value on a recurring basis using significant other observable inputs (Level 2). |
Foreign Currency Translation | Foreign Currency TranslationThe Group operates in a multi-currency environment having transactions in such currencies as the U.S. dollar, Russian rubles, Czech koruna, euros, and others. The reporting currency of the Company is the U.S. dollar. The functional currency of the Company’s foreign subsidiaries is the U.S. dollar, with the exception of Prowly, where the functional currency is the local currency, the Zloty. The foreign currency translation adjustment as it relates to Prowly was immaterial for the three and nine months ended September 30, 2021 and 2020, respectively. For all other entities, foreign currency transactions are measured initially in the functional currency of the recording entity by use of the exchange rate in effect at that date. At each subsequent balance sheet date, foreign currency denominated assets and liabilities of these international subsidiaries are remeasured into U.S. dollars using the exchange rates in effect at the balance sheet date or historical rates, as appropriate. Any differences resulting from the remeasurement of foreign currency denominated assets and liabilities of the international subsidiaries to the U.S. dollar functional currency are recorded within other income (expense) in the unaudited condensed consolidated statement of operations and comprehensive loss. |
Net Income (Loss) Per Share | Net Income (Loss) Per Share Net income (loss) per share information is determined using the two-class method, which includes the weighted-average number of shares of common stock outstanding during the period and other securities that participate in dividends (a participating security). Prior to the completion of the IPO, the Company considered the shares of Preferred Stock to be participating securities because they include rights to participate in dividends with the common stock. As of September 30, 2021, the Company did not have any participating securities outstanding. Under the two-class method, basic net income (loss) per share attributable to common stockholders is computed by dividing the net income (loss) attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. Diluted net income (loss) per share attributable to common stockholders is computed using the more dilutive of (1) the two-class method or (2) the if-converted method. The Company allocates net income first to preferred stockholders based on dividend rights under the Company’s certificate of incorporation and then to preferred and common stockholders based on ownership interests. Net losses are not allocated to preferred stockholders as they do not have an obligation to share in the Company’s net losses. During the nine months ended September 30, 2021, the Company amended its certificate of incorporation to create two classes of common stock outstanding: Class A common stock and Class B common stock. As more fully described in Note 9, the rights of the holders of Class A and Class B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock is entitled to one (1) vote per share and each share of Class B common stock is entitled to ten (10) votes per share. Each share of Class B common stock is convertible into one share of Class A common stock at the option of the holder at any time. Shares of Class B common stock are automatically converted into Class A common stock upon sale or transfer, subject to certain limited exceptions. Shares of Class A common stock are not convertible. See Note 9 to these unaudited condensed consolidated financial statements for additional information regarding the current conversion and transfer terms of the Company’s common stock. The Company allocates undistributed earnings attributable to common stock between the common stock classes on a one to one basis when computing net income (loss) per share. As a result, basic and diluted net income (loss) per share of Class A common stock and share of Class B common stock are equivalent. Diluted net income (loss) per share gives effect to all potentially dilutive securities. Potential dilutive securities consist of shares of common stock issuable upon the exercise of stock options, shares of common stock issuable upon the conversion of the outstanding shares of Preferred Stock, and shares of common stock issuable upon the vesting of restricted stock awards (RSAs) or restricted stock units (RSUs). For the three months ended September 30, 2021 and the three and nine months ended September 30, 2020, the dilutive effect of common stock equivalents has been excluded from the calculation of diluted net loss per share as their effect would have been anti-dilutive due to the net losses incurred for these periods. |
Comprehensive income (loss) | Comprehensive income (loss) Comprehensive income (loss) is comprised of two components: net income (loss) and other comprehensive income (loss), which includes other changes in stockholders’ deficit that result from transactions and economic events other than those with stockholders. An immaterial cumulative translation adjustment related to the Prowly entity has been excluded from other comprehensive income for the three and nine months ended September 30, 2021. There were no components of other comprehensive income to report for the three and nine months ended September 30, 2020 and 2021; accordingly, comprehensive income (loss) equaled the total net income (loss) for all periods presented. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) . ASU 2016-02 requires a lessee to recognize most leases on the balance sheet but recognize expenses on the income statement in a manner similar to current practice. The update states that a lessee will recognize a lease liability for the obligation to make lease payments and a right-to-use asset for the right to use the underlying assets for the lease term. Leases will continue to be classified as either financing or operating, with classification affecting the recognition, measurement, and presentation of expenses and cash flows arising from a lease. For public entities, ASU 2016-02 is effective for years beginning after December 15, 2019. For non-public companies, ASU 2016-02 is effective for fiscal years beginning after December 15, 2021 and interim periods in annual periods beginning after December 15, 2022. Early adoption is permitted. The Company plans to adopt this guidance in the year ended December 31, 2022. The Company is currently assessing the impact that adopting this guidance will have on its consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . ASU 2016-13 requires that credit losses be reported as an allowance using an expected losses model, representing the entity's current estimate of credit losses expected to be incurred. The accounting guidance currently in effect is based on an incurred loss model. ASU 2016-13 affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. ASU 2016-13 is effective for public entities for annual reporting periods beginning after December 15, 2019, including interim periods within those fiscal years. For non-public companies, ASU 2016-13 is effective for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years. The Company plans to adopt this guidance in the year ending December 31, 2023. The Company is currently evaluating ASU 2016-13 and the potential impact on its condensed consolidated financial statements and financial statement disclosures. In August 2018, the FASB issued ASU No. 2018-15, Intangible-Goodwill and Other Internal-Use Software (Subtopic 350-40) . ASU 2018-15 updates guidance regarding accounting for implementation costs associated with a cloud computing arrangement that is a service contract. The amendments under ASU 2018-15 are effective for public entities for years beginning after December 15, 2019, and interim periods within those years. For non-public companies, ASU 2081-15 is effective for annual reporting periods beginning after December 15, 2020, and interim periods within annual periods beginning after December 15, 2021, with early adoption permitted. The Company plans to adopt this guidance in the annual period ending December 31, 2021. The Company is currently assessing the impact that adopting this guidance will have on its condensed consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes – Simplifying the Accounting for Income Taxes . The new guidance simplifies the accounting for income taxes by removing several exceptions in the current standard and adding guidance to reduce complexity in certain areas, such as requiring that an entity reflect the effect of an enacted change in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date. For public companies, the ASU is effective for years beginning after December 15, 2020, and interim periods within those years, with early adoption permitted. For non-public companies, the new standard is effective for years beginning after December 15, 2021, with early adoption permitted. The Company plans to adopt this guidance in the annual period ending December 31, 2022. The Company is currently assessing the impact that adopting this guidance will have on its condensed consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accounting Policies [Abstract] | |
Reconciliation of Cash, Equivalents and Restricted Cash | The following table is a reconciliation of cash, cash equivalents and restricted cash included in the accompanying condensed consolidated balance sheets that sum to the total cash, cash equivalents and restricted cash included in the accompanying condensed consolidated statements of cash flows for the nine months ended September 30, 2021 and 2020. September 30, 2021 September 30, 2020 Cash and cash equivalents $ 188,510 $ 32,712 Restricted cash included in “other long-term assets” 176 88 Total cash, cash equivalents and restricted cash, at end of period $ 188,686 $ 32,800 |
Reconciliation of Cash, Equivalents and Restricted Cash | The following table is a reconciliation of cash, cash equivalents and restricted cash included in the accompanying condensed consolidated balance sheets that sum to the total cash, cash equivalents and restricted cash included in the accompanying condensed consolidated statements of cash flows for the nine months ended September 30, 2021 and 2020. September 30, 2021 September 30, 2020 Cash and cash equivalents $ 188,510 $ 32,712 Restricted cash included in “other long-term assets” 176 88 Total cash, cash equivalents and restricted cash, at end of period $ 188,686 $ 32,800 |
Schedule of Earnings Per Share, Basic and Diluted | The following table presents a reconciliation of the weighted-average shares outstanding used in the calculation of basic and diluted net income (loss) per share: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Weighted-average shares outstanding: Weighted-average number of shares of common stock used in computing net income (loss) per share attributable to common stockholders—basic 135,673,000 94,834,000 122,595,000 94,722,000 Dilutive effect of share equivalents resulting from stock options — — 6,417,000 — Dilutive effect of share equivalents resulting from RSAs and RSUs — — 164,000 — Dilutive effect of shares issuable upon conversion of preferred stock — — 9,463,000 — Weighted-average number of shares of common stock used in computing net income (loss) per share attributable to common stockholders—diluted 135,673,000 94,834,000 138,639,000 94,722,000 |
Schedule of Potentially Dilutive Common Stock Equivalents | The following potentially dilutive common stock equivalents have been excluded from the calculation of diluted weighted-average shares outstanding for the three and nine months ended September 30, 2021 and 2020: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Stock options outstanding 6,500,908 6,223,290 19,503 6,300,903 Shares of Preferred Stock — 29,695,200 — 29,695,200 Unvested RSAs and RSUs 140,793 — 23,723 — 6,641,701 35,918,490 43,226 35,996,103 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consists of the following (in thousands): As of September 30, December 31, Computer equipment $ 4,152 $ 3,513 Furniture and office equipment 1,398 1,041 Leasehold improvements 1,029 667 Capital leases 5,750 — Total property and equipment 12,329 5,221 Less: accumulated depreciation and amortization (3,938) (2,253) Property and equipment, net $ 8,391 $ 2,968 |
Acquisitions, Acquired Intang_2
Acquisitions, Acquired Intangible Assets, and Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Intangible Assets | Intangible assets consists of the following: As of September 30, 2021 Gross Net Carrying Accumulated Carrying Amount Amortization Amount Developed technology 1,194 (219) 975 Trade name 68 (25) 43 Capitalized internal-use software 1,997 (904) 1,093 Total as of September 30, 2021 $ 3,259 $ (1,148) $ 2,111 As of December 31, 2020 Gross Net Carrying Accumulated Carrying Amount Amortization Amount Developed technology 1,194 (66) 1,128 Trade name 68 (3) 65 Capitalized internal-use software 1,561 (523) 1,038 Total as of December 31, 2020 $ 2,823 $ (592) $ 2,231 |
Schedule of Future Amortization Expense | As of September 30, 2021, future amortization expense is expected to be as follows: Amount Remainder of 2021 $ 156 2022 559 2023 428 2024 199 2025 and thereafter 769 Total $ 2,111 |
Accrued expenses (Tables)
Accrued expenses (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued expenses | Accrued expenses consist of the following: As of September 30, December 31, Employee compensation $ 9,309 $ 4,478 Vacation reserves 464 465 Other 12,512 2,776 Total accrued expenses $ 22,285 $ 7,719 |
Redeemable Convertible Prefer_2
Redeemable Convertible Preferred Stock and Stockholders’ Equity (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
Common Stock Reserved For Future Issuance | As of September 30, 2021, the Company had reserved the following shares of common stock for future issuance: Options outstanding 7,064,945 Options reserved for future issuance 12,730,521 Restricted stock outstanding 156,852 Restricted stock units 164,487 Total authorized shares of common stock reserved for future issuance 20,116,805 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock-based Compensation Expense | The following table shows stock-based compensation expense by where the stock-based compensation expense is recorded in the Company’s unaudited condensed consolidated statement of operations: Three Months Ended Nine Months Ended 2021 2020 2021 2020 Cost of revenue $ 7 $ 5 $ 22 $ 14 Sales and marketing 100 36 245 100 Research and development 68 29 204 86 General and administrative 452 188 1,318 472 Total stock-based compensation $ 627 $ 258 $ 1,789 $ 672 |
Weighted-Average Assumptions to Determine Fair Value | The weighted-average assumptions utilized to determine the fair value of options granted to employees are presented in the following table: Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Expected volatility N/A 52.0 % 52.0 % 49.7 % Weighted-average risk-free interest rate N/A 0.33 % 1.04 % 0.80 % Expected dividend yield N/A — — — Expected life – in years N/A 6 6 6 |
Summary of Option Activity | A summary of the Company’s option activity as of September 30, 2021, which all occurred under the 2019 Plan and the 2021 Plan, and changes during the nine months then ended are as follows: Number of Options Weighted-Average Exercise Price (per share) Weighted-Average Remaining Contractual Term (in years) Outstanding at December 31, 2020 7,611,258 $ 1.37 8.40 Granted 229,053 12.37 Exercised (577,153) 1.18 Forfeited (198,213) 2.35 Outstanding at September 30, 2021 7,064,945 1.72 7.84 Options exercisable at September 30, 2021 3,346,067 1.02 7.99 |
Summary of Restricted Stock Unit Activity | A summary of RSU activity under the Company’s 2021 Plan for the nine months ended September 30, 2021 is as follows: Number of Shares Weighted-Average Grant Date Fair Value Aggregate Fair Value Unvested balance at January 1, 2021 — — Granted 164,487 11.48 $ 1,888 Vested — — Forfeited — — Unvested balance as of September 30, 2021 164,487 11.48 |
Commitment and Contingencies (T
Commitment and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Minimum Amounts Payable Under Operating Leases | Future minimum amounts payable as of September 30, 2021, under the office facilities operating leases and data center agreements are as follows: Operating Leases Remainder of 2021 $ 1,052 2022 4,602 2023 2,956 2024 1,774 2025 and thereafter 2,938 Total minimum lease payments $ 13,322 |
Components of Other Expense, _2
Components of Other Expense, Net (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Other Income and Expenses [Abstract] | |
Summary of Components of Other Expense, Net | The components of other expense, net, are as follows: Three Months Ended Nine Months Ended 2021 2020 2021 2020 Foreign currency exchange loss (57) (26) (66) (296) Other, net (127) (79) (190) 102 Other expense, net $ (184) $ (105) $ (256) $ (194) |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Total Revenue by Geographic Area | Total revenue by geographic area was as follows: Three Months Ended Nine Months Ended 2021 2020 2021 2020 Revenue: United States $ 22,317 $ 14,964 $ 61,038 $ 41,036 United Kingdom 5,164 3,399 14,064 9,427 Other 21,771 13,833 59,153 37,972 Total revenue $ 49,252 $ 32,196 $ 134,255 $ 88,435 |
Property and Equipment, Net by Geographic Location | Property and equipment, net by geographic location consists of the following: As of September 30, December 31, Property and equipment, net: United States $ 6,475 $ 1,023 Russia 1,440 1,450 Czech Republic 425 439 Other 51 56 Total assets $ 8,391 $ 2,968 |
Overview and Basis of Present_2
Overview and Basis of Presentation (Details) - USD ($) $ / shares in Units, $ in Thousands | Apr. 23, 2021 | Mar. 29, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2021 | Sep. 30, 2020 |
Sale of Stock [Line Items] | ||||||
Issuance costs | $ 0 | $ 658 | ||||
Class A Common Stock | ||||||
Sale of Stock [Line Items] | ||||||
Issuance costs | $ 825 | $ 13,378 | ||||
Number of shares issued in conversion (in shares) | 1 | |||||
Class B Common Stock | ||||||
Sale of Stock [Line Items] | ||||||
Number of shares issued in conversion (in shares) | 1 | |||||
IPO | Class A Common Stock | ||||||
Sale of Stock [Line Items] | ||||||
Stock sold (in shares) | 10,000,000 | |||||
Price per share (in USD per share) | $ 14 | |||||
Net proceeds | $ 126,600 | |||||
Issuance costs | $ 13,400 | |||||
Underwriters' option | Class A Common Stock | ||||||
Sale of Stock [Line Items] | ||||||
Stock sold (in shares) | 719,266 | |||||
Net proceeds | $ 9,200 | |||||
Issuance costs | $ 800 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021USD ($)vote | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($)voteshares | Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($) | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||||
Increase in deferred revenue | $ 9,634 | $ 3,825 | |||
Revenue recognized that was included in deferred revenue at the beginning of each period | $ 18,504 | $ 11,672 | $ 22,874 | 17,343 | |
Amortization period of deferred contract costs | 24 months | 24 months | |||
Restricted cash | $ 176 | 88 | $ 176 | 88 | $ 88 |
Money market funds | 21,727 | 21,727 | 29,369 | ||
Foreign currency exchange loss | $ (57) | $ (26) | $ (66) | $ (296) | |
Allocable basis to compute net income (loss) per share | shares | 1 | ||||
Class A Common Stock | |||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||||
Number of votes per share of common stock held | vote | 1 | 1 | |||
Number of shares issued in conversion (in shares) | shares | 1 | ||||
Class B Common Stock | |||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||||
Number of votes per share of common stock held | vote | 10 | 10 | |||
Number of shares issued in conversion (in shares) | shares | 1 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||||
Aggregate amount of transaction price | $ 1,280 | ||||
Remaining performance obligation, expected timing of satisfaction | 12 months | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01 | |||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |||||
Aggregate amount of transaction price | $ 1,081 | $ 1,081 | |||
Remaining performance obligation, expected timing of satisfaction | 12 months | 12 months |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Reconciliation of Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 188,510 | $ 35,531 | $ 32,712 | |
Restricted cash included in “other long-term assets” | 176 | 88 | 88 | |
Cash, cash equivalents and restricted cash | $ 188,686 | $ 35,619 | $ 32,800 | $ 37,523 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Reconciliation of the Numerator and Denominator Used in the Calculation of Basic and Diluted Net Income (Loss) Per Share (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Weighted-average shares outstanding: | ||||
Weighted-average number of shares of common stock used in computing net income per share attributable to common stockholders—basic (in shares) | 135,673 | 94,834 | 122,595 | 94,722 |
Dilutive effect of shares issuable upon conversion of preferred stock (in shares) | 0 | 0 | 9,463 | 0 |
Weighted-average number of shares of common stock used in computing net income (loss) per share attributable to common stockholders—diluted (in shares) | 135,673 | 94,834 | 138,639 | 94,722 |
Stock options outstanding | ||||
Weighted-average shares outstanding: | ||||
Dilutive effect of share equivalents resulting (in shares) | 0 | 0 | 6,417 | 0 |
Restricted stock units | ||||
Weighted-average shares outstanding: | ||||
Dilutive effect of share equivalents resulting (in shares) | 0 | 0 | 164 | 0 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Potentially Dilutive Common Stock Equivalents (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive common stock equivalents (in shares) | 6,641,701 | 35,918,490 | 43,226 | 35,996,103 |
Stock options outstanding | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive common stock equivalents (in shares) | 6,500,908 | 6,223,290 | 19,503 | 6,300,903 |
Shares of Preferred Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive common stock equivalents (in shares) | 0 | 29,695,200 | 0 | 29,695,200 |
Restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive common stock equivalents (in shares) | 140,793 | 0 | 23,723 | 0 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Property, Plant and Equipment [Line Items] | |||||
Property and equipment | $ 12,329 | $ 12,329 | $ 5,221 | ||
Less: accumulated depreciation and amortization | (3,938) | (3,938) | (2,253) | ||
Property and equipment, net | 8,391 | 8,391 | 2,968 | ||
Depreciation and amortization | 813 | $ 240 | 1,947 | $ 651 | |
Computer equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment | 4,152 | 4,152 | 3,513 | ||
Furniture and office equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment | 1,398 | 1,398 | 1,041 | ||
Leasehold improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment | 1,029 | 1,029 | 667 | ||
Capital leases | |||||
Property, Plant and Equipment [Line Items] | |||||
Property and equipment | 5,750 | 5,750 | $ 0 | ||
Property and equipment, net | $ 4,837 | $ 4,837 |
Other Long-Term Assets - Debt O
Other Long-Term Assets - Debt Offering Costs (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Deferred offering costs, IPO | $ 0 | $ 1,839 |
Deferred offering costs, credit facility | $ 473 | $ 630 |
Other Long-Term Assets - Invest
Other Long-Term Assets - Investments in Convertible Debt (Details) $ in Thousands | 1 Months Ended | 9 Months Ended | |
Jan. 31, 2021USD ($)investment | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |||
Number of convertible debt securities purchased | investment | 2 | ||
Investment in convertible debt securities | $ | $ 500 | $ 500 | $ 0 |
Investment interest rate | 6.00% |
Acquisitions, Acquired Intang_3
Acquisitions, Acquired Intangible Assets, and Goodwill - Acquisition (Details) - USD ($) $ in Thousands | Aug. 27, 2020 | Sep. 30, 2021 | Sep. 30, 2021 |
Business Acquisition [Line Items] | |||
Compensation expense related to the acquisition | $ 283 | $ 452 | |
Prowly | |||
Business Acquisition [Line Items] | |||
Outstanding capital acquired | 100.00% | ||
Cash consideration for acquisition | $ 3,317 | ||
Maximum additional consideration payable | $ 2,750 |
Acquisitions, Acquired Intang_4
Acquisitions, Acquired Intangible Assets, and Goodwill - Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 3,259 | $ 2,823 |
Accumulated amortization | (1,148) | (592) |
Net carrying amount | 2,111 | 2,231 |
Developed technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 1,194 | 1,194 |
Accumulated amortization | (219) | (66) |
Net carrying amount | 975 | 1,128 |
Trade name | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 68 | 68 |
Accumulated amortization | (25) | (3) |
Net carrying amount | 43 | 65 |
Capitalized internal-use software | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 1,997 | 1,561 |
Accumulated amortization | (904) | (523) |
Net carrying amount | $ 1,093 | $ 1,038 |
Acquisitions, Acquired Intang_5
Acquisitions, Acquired Intangible Assets, and Goodwill - Intangible Assets Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Net carrying amount | $ 2,111,000 | $ 2,111,000 | $ 2,231,000 | ||
Amortization expense | 55,000 | $ 0 | 171,000 | $ 0 | |
Software development | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Capitalized software development costs | 170,000 | 292,000 | 441,000 | 895,000 | |
Amortization expense associated with capitalized development costs | 123,000 | $ 75,000 | 382,000 | $ 179,000 | |
Net carrying amount | $ 1,093,000 | $ 1,093,000 | $ 1,038,000 |
Acquisitions, Acquired Intang_6
Acquisitions, Acquired Intangible Assets, and Goodwill - Amortization (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
Remainder of 2021 | $ 156 | |
2022 | 559 | |
2023 | 428 | |
2024 | 199 | |
2025 and thereafter | 769 | |
Net carrying amount | $ 2,111 | $ 2,231 |
Acquisitions, Acquired Intang_7
Acquisitions, Acquired Intangible Assets, and Goodwill - Goodwill (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | |
Business Combination and Asset Acquisition [Abstract] | ||
Change in carrying value of goodwill | $ 0 | |
Goodwill | $ 1,991,000 | $ 1,991,000 |
Accrued expenses (Details)
Accrued expenses (Details) - USD ($) $ in Thousands | Sep. 30, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Employee compensation | $ 9,309 | $ 4,478 |
Vacation reserves | 464 | 465 |
Other | 12,512 | 2,776 |
Total accrued expenses | $ 22,285 | $ 7,719 |
Revolving Credit Facility (Deta
Revolving Credit Facility (Details) - JPMorgan Chase Bank, N.A. - USD ($) | Jan. 12, 2021 | Sep. 30, 2021 | Sep. 30, 2021 |
Revolving credit facility | |||
Line of Credit Facility [Line Items] | |||
Fee on undrawn amounts | 0.25% | ||
Interest expense | $ 28,000 | $ 81,000 | |
Revolving credit facility | London Interbank Offered Rate (LIBOR) | |||
Line of Credit Facility [Line Items] | |||
Variable interest rate floor | 0.50% | ||
Margin on variable interest rate | 2.75% | ||
Margin on variable interest rate, prior to initial public offering or positive adjusted EBITDA | 3.50% | ||
Revolving credit facility | Base Rate | |||
Line of Credit Facility [Line Items] | |||
Variable interest rate floor | 3.25% | ||
Variable interest rate floor, prior to initial public offering or positive adjusted EBITDA | 1.50% | ||
Margin on variable interest rate | 0.00% | ||
Margin on variable interest rate, prior to initial public offering or positive adjusted EBITDA | 2.50% | ||
Revolving credit facility | JP Morgan Chase Credit Agreement | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 45,000,000 | ||
Advance rate | 400.00% | ||
Term | 3 years | ||
Letter of credit sub-facility | JP Morgan Chase Credit Agreement | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 5,000,000 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | ||||
Provision for income taxes | $ 101 | $ 176 | $ 328 | $ 384 |
Redeemable Convertible Prefer_3
Redeemable Convertible Preferred Stock and Stockholders’ Equity - Additional Information (Details) | Mar. 28, 2021shares | Mar. 15, 2021 | Sep. 30, 2021vote$ / sharesshares | Dec. 31, 2020$ / sharesshares |
Class of Stock [Line Items] | ||||
Redeemable convertible preferred stock, authorized (in shares) | 9,898,400 | |||
Preferred stock, conversion ratio | 3 | |||
Conversion of preferred stock (in shares) | 29,695,200 | |||
Common stock, authorized (in shares) | 0 | 300,000,000 | ||
Common stock, par value (in USD per share) | $ / shares | $ 0.00001 | $ 0.00001 | ||
Preferred stock, authorized (in shares) | 100,000,000 | |||
Preferred stock, par value (in USD per share) | $ / shares | $ 0.00001 | |||
Percentage of votes required | 0.6666 | |||
Anniversary of effectiveness | 7 years | |||
Percentage of outstanding shares | 0.10 | |||
Conversion ratio | 3 | |||
Series A redeemable convertible preferred stock | ||||
Class of Stock [Line Items] | ||||
Redeemable convertible preferred stock, authorized (in shares) | 3,379,400 | 0 | 3,379,400 | |
Series A-1 redeemable convertible preferred stock | ||||
Class of Stock [Line Items] | ||||
Redeemable convertible preferred stock, authorized (in shares) | 1,837,600 | 0 | 1,837,600 | |
Series B convertible preferred stock | ||||
Class of Stock [Line Items] | ||||
Redeemable convertible preferred stock, authorized (in shares) | 4,681,400 | |||
Preferred stock, authorized (in shares) | 0 | 4,681,400 | ||
Preferred stock, par value (in USD per share) | $ / shares | $ 0.00001 | $ 0.00001 | ||
Class A Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock, authorized (in shares) | 1,000,000,000 | 0 | ||
Common stock, par value (in USD per share) | $ / shares | $ 0.00001 | $ 0.00001 | ||
Number of votes per share of common stock held | vote | 1 | |||
Number of shares issued in conversion (in shares) | 1 | |||
Class B Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock, authorized (in shares) | 160,000,000 | 0 | ||
Common stock, par value (in USD per share) | $ / shares | $ 0.00001 | $ 0.00001 | ||
Number of votes per share of common stock held | vote | 10 | |||
Number of shares issued in conversion (in shares) | 1 |
Redeemable Convertible Prefer_4
Redeemable Convertible Preferred Stock and Stockholders’ Equity - Common Stock Reserved for Future Issuance (Details) | Sep. 30, 2021shares |
Class of Stock [Line Items] | |
Total authorized shares of common stock reserved for future issuance (in shares) | 20,116,805 |
Options outstanding | |
Class of Stock [Line Items] | |
Total authorized shares of common stock reserved for future issuance (in shares) | 7,064,945 |
Options reserved for future issuance | |
Class of Stock [Line Items] | |
Total authorized shares of common stock reserved for future issuance (in shares) | 12,730,521 |
Unvested RSAs and RSUs | |
Class of Stock [Line Items] | |
Total authorized shares of common stock reserved for future issuance (in shares) | 156,852 |
Restricted stock units | |
Class of Stock [Line Items] | |
Total authorized shares of common stock reserved for future issuance (in shares) | 164,487 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) | Jul. 28, 2020 | Jul. 31, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Stock-based compensation | $ 627,000 | $ 258,000 | $ 1,789,000 | $ 672,000 | ||||
Unrecognized compensation cost | $ 4,780,000 | $ 4,780,000 | ||||||
Unrecognized compensation cost, period of recognition | 2 years 10 months 2 days | |||||||
Expected dividend yield | 0.00% | 0.00% | 0.00% | |||||
Granted (in shares) | 0 | 229,053 | ||||||
Weighted-average grant date fair value of options granted (in USD per share) | $ 0.89 | $ 6.13 | $ 0.74 | |||||
Tax benefit | $ 0 | $ 0 | $ 0 | $ 0 | ||||
Aggregate intrinsic value of options outstanding | 150,739,000 | 150,739,000 | $ 36,816,000 | |||||
Aggregate intrinsic value of options exercised | 11,918,000 | 12,410,000 | ||||||
Aggregate intrinsic value of options exercisable | $ 73,732,000 | $ 73,732,000 | ||||||
Vested (in shares) | 51,762 | |||||||
Restricted stock units | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Service period | 4 years | |||||||
Stock-based compensation | $ 139,000 | $ 284,000 | $ 0 | |||||
Awards granted (in shares) | 9,462 | 164,487 | 0 | |||||
Vested (in shares) | 0 | |||||||
Restricted stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Service period | 3 years | |||||||
Awards granted (in shares) | 156,852 | |||||||
Fair value of awards granted | $ 291,000 | |||||||
ESPP | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares reserved and authorized (in shares) | 3,000,667 | 3,000,667 | ||||||
Percent of outstanding shares | 1.00% | |||||||
2019 Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares reserved and authorized (in shares) | 10,163,772 | 8,682,600 | ||||||
Award vesting period | 4 years | |||||||
Award expiration period | 10 years | |||||||
2021 Plan | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Number of shares reserved and authorized (in shares) | 13,503,001 | 13,503,001 | ||||||
Percent of outstanding shares | 5.00% |
Stock-Based Compensation - Expe
Stock-Based Compensation - Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation | $ 627 | $ 258 | $ 1,789 | $ 672 |
Cost of revenue | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation | 7 | 5 | 22 | 14 |
Sales and marketing | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation | 100 | 36 | 245 | 100 |
Research and development | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation | 68 | 29 | 204 | 86 |
General and administrative | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total stock-based compensation | $ 452 | $ 188 | $ 1,318 | $ 472 |
Stock-Based Compensation - Fair
Stock-Based Compensation - Fair Value Assumptions (Details) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |||
Expected volatility | 52.00% | 52.00% | 49.70% |
Weighted-average risk-free interest rate | 0.33% | 1.04% | 0.80% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Expected life – in years | 6 years | 6 years | 6 years |
Stock-Based Compensation - Opti
Stock-Based Compensation - Options Activity (Details) - $ / shares | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Sep. 30, 2021 | Sep. 30, 2021 | Dec. 31, 2020 | |
Number of Options | |||
Outstanding (in shares) | 7,611,258 | ||
Granted (in shares) | 0 | 229,053 | |
Exercised (in shares) | (577,153) | ||
Forfeited (in shares) | (198,213) | ||
Outstanding (in shares) | 7,064,945 | 7,064,945 | 7,611,258 |
Options exercisable (in shares) | 3,346,067 | 3,346,067 | |
Weighted-Average Exercise Price | |||
Outstanding (in USD per share) | $ 1.37 | ||
Granted (in USD per share) | 12.37 | ||
Exercised (in USD per share) | 1.18 | ||
Forfeited (in USD per share) | 2.35 | ||
Outstanding (in USD per share) | $ 1.72 | 1.72 | $ 1.37 |
Options exercisable (in USD per share) | $ 1.02 | $ 1.02 | |
Weighted-Average Remaining Contractual Term | |||
Outstanding | 7 years 10 months 2 days | 8 years 4 months 24 days | |
Options exercisable | 7 years 11 months 26 days |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Units Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | |
Number of Shares | |||
Vested (in shares) | 51,762 | ||
Restricted stock units | |||
Number of Shares | |||
Unvested beginning balance (in shares) | 0 | ||
Granted (in shares) | 9,462 | 164,487 | 0 |
Vested (in shares) | 0 | ||
Forfeited (in shares) | 0 | ||
Unvested ending balance (in shares) | 164,487 | 164,487 | |
Weighted-Average Grant Date Fair Value | |||
Unvested beginning balance (in USD per share) | $ 0 | ||
Granted (in USD per share) | 11.48 | ||
Vested (in USD per share) | 0 | ||
Forfeited (in USD per share) | 0 | ||
Unvested ending balance (in USD per share) | $ 11.48 | $ 11.48 | |
Aggregate Fair Value | $ 1,888 | $ 1,888 |
Commitment and Contingencies -
Commitment and Contingencies - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Other Commitments [Line Items] | |||||
Rent expense | $ 994 | $ 1,053 | $ 2,875 | $ 3,218 | |
Total required lease payments | 13,322 | 13,322 | |||
Property and equipment, net | 8,391 | 8,391 | $ 2,968 | ||
Data provider | |||||
Other Commitments [Line Items] | |||||
Committed spending amount for the remainder of the year | 1,602 | 1,602 | |||
Committed spending amount for year two | 7,935 | 7,935 | |||
Committed spending amount for year three | $ 2,416 | $ 2,416 | |||
Data center equipment | |||||
Other Commitments [Line Items] | |||||
Lease arrangement term | 36 months | 36 months | |||
Total required lease payments | $ 6,496 | $ 6,496 | |||
Capital leases | |||||
Other Commitments [Line Items] | |||||
Property and equipment, net | 4,837 | $ 4,837 | |||
Depreciation period | 36 months | ||||
Current Capital Lease Obligations | |||||
Other Commitments [Line Items] | |||||
Property and equipment, net | 1,877 | $ 1,877 | |||
Non-Current Capital Lease Obligations | |||||
Other Commitments [Line Items] | |||||
Property and equipment, net | $ 2,960 | $ 2,960 |
Commitment and Contingencies _2
Commitment and Contingencies - Future Minimum Amounts Payable Under Operating Leases (Details) $ in Thousands | Sep. 30, 2021USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Remainder of 2021 | $ 1,052 |
2022 | 4,602 |
2023 | 2,956 |
2024 | 1,774 |
2025 and thereafter | 2,938 |
Total minimum lease payments | $ 13,322 |
Components of Other Expense, _3
Components of Other Expense, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Other Income and Expenses [Abstract] | ||||
Foreign currency exchange loss | $ (57) | $ (26) | $ (66) | $ (296) |
Other, net | (127) | (79) | (190) | 102 |
Other expense, net | $ (184) | $ (105) | $ (256) | $ (194) |
Employee Benefit Plan (Details)
Employee Benefit Plan (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Retirement Benefits [Abstract] | ||||
Matching contributions | $ 160 | $ 47 | $ 384 | $ 123 |
Segment and Geographic Inform_3
Segment and Geographic Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($)segment | Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($) | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Number of operating segments | segment | 1 | ||||
Total revenue | $ 49,252 | $ 32,196 | $ 134,255 | $ 88,435 | |
Total assets | 8,391 | 8,391 | $ 2,968 | ||
United States | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Total revenue | 22,317 | 14,964 | 61,038 | 41,036 | |
Total assets | 6,475 | 6,475 | 1,023 | ||
United Kingdom | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Total revenue | 5,164 | 3,399 | 14,064 | 9,427 | |
Russia | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Total assets | 1,440 | 1,440 | 1,450 | ||
Czech Republic | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Total assets | 425 | 425 | 439 | ||
Other | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Total revenue | 21,771 | $ 13,833 | 59,153 | $ 37,972 | |
Total assets | $ 51 | $ 51 | $ 56 |