Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2022 | Nov. 07, 2022 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2022 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | P10, Inc. | |
Entity Central Index Key | 0001841968 | |
Entity File Number | 001-40937 | |
Entity Tax Identification Number | 87-2908160 | |
Entity Incorporation, State or Country Code | DE | |
Current Fiscal Year End Date | --12-31 | |
Entity Address, Address Line One | 4514 Cole Ave | |
Entity Address, Address Line Two | Suite 1600 | |
Entity Address, City or Town | Dallas | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 75205 | |
City Area Code | 214 | |
Local Phone Number | 865-7998 | |
Entity Current Reporting Status | Yes | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Small Business | false | |
Entity Filer Category | Non-accelerated Filer | |
Entity Shell Company | false | |
Entity Interactive Data Current | Yes | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Common Class A | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Class A Common Stock, $0.001 par value per share | |
Trading Symbol | PX | |
Security Exchange Name | NYSE | |
Entity Common Stock, Shares Outstanding | 40,911,332 | |
Common Class B | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 76,142,326 | |
Series A Junior Participating Preferred Stock Purchase Rights | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Series A Junior Participating Preferred Stock Purchase Rights |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
ASSETS | ||
Cash and cash equivalents | $ 19,415 | $ 40,916 |
Restricted cash | 1,347 | 2,566 |
Accounts receivable | 5,407 | 2,854 |
Note receivable | 4,001 | 2,552 |
Due from related parties | 30,359 | 12,357 |
Investment in unconsolidated subsidiaries | 2,137 | 1,803 |
Prepaid expense and other assets | 3,596 | 4,759 |
Property and equipment, net | 2,513 | 981 |
Right-of-use assets | 13,052 | 14,789 |
Deferred tax assets, net | 37,321 | 45,151 |
Intangibles, net | 110,449 | 128,788 |
Goodwill | 418,690 | 418,701 |
Total assets | 648,287 | 676,217 |
LIABILITIES: | ||
Accounts payable | 1,901 | 401 |
Accrued expenses | 4,958 | 6,009 |
Accrued compensation and benefits | 8,818 | 6,465 |
Due to related parties | 1,519 | 2,258 |
Other liabilities | 602 | 1,808 |
Contingent consideration | 24,330 | 22,963 |
Deferred revenues | 12,748 | 12,953 |
Lease liabilities | 15,425 | 15,700 |
Debt obligations | 170,774 | 212,496 |
Total liabilities | 241,075 | 281,053 |
COMMITMENTS AND CONTINGENCIES (NOTE 14) | ||
STOCKHOLDERS' EQUITY: | ||
Treasury stock | (3,439) | (273) |
Additional paid-in-capital | 641,055 | 650,405 |
Accumulated deficit | (230,521) | (255,085) |
Total stockholders' equity | 407,212 | 395,164 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 648,287 | 676,217 |
Common Class A [Member] | ||
STOCKHOLDERS' EQUITY: | ||
Common stock value | 41 | 34 |
Common Class B [Member] | ||
STOCKHOLDERS' EQUITY: | ||
Common stock value | $ 76 | $ 83 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2022 | Dec. 31, 2021 |
Common Class A [Member] | ||
Common stock par value | $ 0.001 | $ 0.001 |
Common stock shares authorized | 510,000,000 | 510,000,000 |
Common stock shares issued | 41,390,836 | 34,464,920 |
Common stock shares outstanding | 41,102,331 | 34,464,920 |
Common Class B [Member] | ||
Common stock par value | $ 0.001 | $ 0.001 |
Common stock shares authorized | 180,000,000 | 180,000,000 |
Common stock shares issued | 76,266,513 | 82,851,279 |
Common stock shares outstanding | 76,143,061 | 82,727,827 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
REVENUES | ||||
Total revenues | $ 49,996 | $ 38,145 | $ 140,015 | $ 104,901 |
OPERATING EXPENSES | ||||
Compensation and benefits | 23,984 | 14,055 | 60,293 | 38,328 |
Professional fees | 4,064 | 2,901 | 9,416 | 9,038 |
General, administrative and other | 4,031 | 2,667 | 12,393 | 6,919 |
Contingent consideration expense | 1,380 | (26) | 1,367 | 134 |
Amortization of intangibles | 6,153 | 7,484 | 18,487 | 22,452 |
Strategic alliance expense | 124 | 0 | 429 | 0 |
Total operating expenses | 39,736 | 27,081 | 102,385 | 76,871 |
INCOME FROM OPERATIONS | 10,260 | 11,064 | 37,630 | 28,030 |
OTHER (EXPENSE)/INCOME | ||||
Interest expense implied on notes payable to sellers | 0 | (223) | 0 | (657) |
Interest expense, net | (2,358) | (5,261) | (5,268) | (15,761) |
Other income | 183 | 257 | 1,303 | 802 |
Total other (expense) | (2,175) | (5,227) | (3,965) | (15,616) |
Net income before income taxes | 8,085 | 5,837 | 33,665 | 12,414 |
Income tax expense | (2,468) | (1,759) | (9,102) | (3,154) |
NET INCOME | 5,617 | 4,078 | 24,563 | 9,260 |
Less: preferred dividends attributable to redeemable noncontrolling interest | 0 | (494) | 0 | (1,483) |
NET INCOME ATTRIBUTABLE TO P10 | $ 5,617 | $ 3,584 | $ 24,563 | $ 7,777 |
Earnings per share | ||||
Basic earnings per share | $ 0.05 | $ 0.04 | $ 0.21 | $ 0.09 |
Diluted earnings per share | 0.05 | 0.04 | 0.20 | 0.08 |
Dividends paid per share | $ 0.03 | $ 0 | $ 0.06 | $ 0 |
Weighted average shares outstanding, basic | 117,210 | 62,465 | 117,210 | 62,465 |
Weighted average shares outstanding, diluted | 121,532 | 66,788 | 121,362 | 66,703 |
Management and Advisory Fees | ||||
REVENUES | ||||
Total revenues | $ 49,479 | $ 37,939 | $ 138,957 | $ 104,029 |
Other Revenue [Member] | ||||
REVENUES | ||||
Total revenues | $ 517 | $ 206 | $ 1,058 | $ 872 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) | Total | Common Stock | Common Stock Common Class A | Common Stock Common Class B | Treasury Stock | Additional Paid-in-capital | Accumulated Deficit |
Balance at Dec. 31, 2020 | $ 59,841,000 | $ 63,000 | $ (273,000) | $ 324,310,000 | $ (264,259,000) | ||
Balance (in shares) at Dec. 31, 2020 | 62,464 | 123 | |||||
Stock-based compensation | 424,000 | 424,000 | |||||
Net income attributable to P10 | 2,215,000 | 2,215,000 | |||||
Balance at Mar. 31, 2021 | 62,480,000 | $ 63,000 | $ (273,000) | 324,734,000 | (262,044,000) | ||
Balance (in shares) at Mar. 31, 2021 | 62,464 | 123 | |||||
Balance at Dec. 31, 2020 | 59,841,000 | $ 63,000 | $ (273,000) | 324,310,000 | (264,259,000) | ||
Balance (in shares) at Dec. 31, 2020 | 62,464 | 123 | |||||
Net income attributable to P10 | 7,777,000 | ||||||
Dividends declared | 0 | ||||||
Balance at Sep. 30, 2021 | 69,070,000 | $ 63,000 | $ (273,000) | 325,762,000 | (256,482,000) | ||
Balance (in shares) at Sep. 30, 2021 | 62,464 | 123 | |||||
Balance at Mar. 31, 2021 | 62,480,000 | $ 63,000 | $ (273,000) | 324,734,000 | (262,044,000) | ||
Balance (in shares) at Mar. 31, 2021 | 62,464 | 123 | |||||
Stock-based compensation | 567,000 | 567,000 | |||||
Net income attributable to P10 | 1,978,000 | 1,978,000 | |||||
Balance at Jun. 30, 2021 | 65,025,000 | $ 63,000 | $ (273,000) | 325,301,000 | (260,066,000) | ||
Balance (in shares) at Jun. 30, 2021 | 62,464 | 123 | |||||
Stock-based compensation | 461,000 | 461,000 | |||||
Net income attributable to P10 | 3,584,000 | 3,584,000 | |||||
Balance at Sep. 30, 2021 | 69,070,000 | $ 63,000 | $ (273,000) | 325,762,000 | (256,482,000) | ||
Balance (in shares) at Sep. 30, 2021 | 62,464 | 123 | |||||
Balance at Dec. 31, 2021 | 395,164,000 | $ 34,000 | $ 83,000 | $ (273,000) | 650,405,000 | (255,085,000) | |
Balance (in shares) at Dec. 31, 2021 | 34,464 | 82,727 | 123 | ||||
Stock-based compensation | 1,515,000 | 1,515,000 | |||||
Deferred offering costs | (70,000) | (70,000) | |||||
Net income attributable to P10 | 7,792,000 | 7,792,000 | |||||
Exchange of Class B common stock for Class A common stock (Amount) | $ 1,000 | $ (1,000) | |||||
Exchange of Class B common stock for Class A common stock (Share) | 1,222 | (1,220) | |||||
Settlement of stock options repurchase | (12,466,000) | (12,466,000) | |||||
Balance at Mar. 31, 2022 | 391,935,000 | $ 35,000 | $ 82,000 | $ (273,000) | 639,384,000 | (247,293,000) | |
Balance (in shares) at Mar. 31, 2022 | 35,686 | 81,507 | 123 | ||||
Balance at Dec. 31, 2021 | 395,164,000 | $ 34,000 | $ 83,000 | $ (273,000) | 650,405,000 | (255,085,000) | |
Balance (in shares) at Dec. 31, 2021 | 34,464 | 82,727 | 123 | ||||
Net income attributable to P10 | $ 24,563,000 | ||||||
Exercise of stock options (in shares) | 41,570 | ||||||
Dividends declared | $ (1,000) | ||||||
Balance at Sep. 30, 2022 | 407,212,000 | $ 41,000 | $ 76,000 | $ (3,439,000) | 641,055,000 | (230,521,000) | |
Balance (in shares) at Sep. 30, 2022 | 41,102 | 76,143 | 412 | ||||
Balance at Mar. 31, 2022 | 391,935,000 | $ 35,000 | $ 82,000 | $ (273,000) | 639,384,000 | (247,293,000) | |
Balance (in shares) at Mar. 31, 2022 | 35,686 | 81,507 | 123 | ||||
Stock-based compensation | 2,717,000 | 2,717,000 | |||||
Net income attributable to P10 | 11,154,000 | 11,154,000 | |||||
Exchange of Class B common stock for Class A common stock (Amount) | $ 2,000 | $ (2,000) | |||||
Exchange of Class B common stock for Class A common stock (Share) | 1,622 | (1,622) | |||||
Dividends declared | (1,000) | (1,000) | |||||
Dividends paid | (3,515,000) | (3,515,000) | |||||
Balance at Jun. 30, 2022 | 402,290,000 | $ 37,000 | $ 80,000 | $ (273,000) | 638,585,000 | (236,139,000) | |
Balance (in shares) at Jun. 30, 2022 | 37,308 | 79,885 | 123 | ||||
Stock-based compensation | 2,790,000 | 2,790,000 | |||||
Net income attributable to P10 | 5,617,000 | 5,617,000 | |||||
Exchange of Class B common stock for Class A common stock (Amount) | 0 | $ 4,000 | $ (4,000) | ||||
Exchange of Class B common stock for Class A common stock (Share) | (3,742) | 3,742 | |||||
Issuance of restricted stock awards (Share) | 33 | ||||||
Issuance of restricted stock units (in shares) | 297 | ||||||
Issuance of restricted stock units | 3,278,000 | 3,278,000 | |||||
Exercise of stock options (in shares) | 11 | ||||||
Exercise of stock options | (72,000) | (72,000) | |||||
Treasury Stock, Stock repurchase (Shares) | (289) | 289 | |||||
Treasury Stock, Stock repurchase | 3,166,000 | $ (3,166,000) | |||||
Dividends declared | (1,000) | (1,000) | |||||
Dividends paid | (3,526,000) | (3,526,000) | |||||
Balance at Sep. 30, 2022 | $ 407,212,000 | $ 41,000 | $ 76,000 | $ (3,439,000) | $ 641,055,000 | $ (230,521,000) | |
Balance (in shares) at Sep. 30, 2022 | 41,102 | 76,143 | 412 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income | $ 24,563 | $ 9,260 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Stock-based compensation | 11,498 | 1,452 |
Non-cash incentive compensation | 0 | 1,396 |
Depreciation expense | 336 | 202 |
Amortization of intangibles | 18,487 | 22,452 |
Amortization of debt issuance costs and debt discount | 643 | 2,798 |
Income from unconsolidated subsidiaries | (1,296) | (781) |
Deferred tax expense | 7,830 | 2,127 |
Remeasurement of contingent consideration | 1,367 | |
Post close purchase price adjustment | 11 | 0 |
Change in operating assets and liabilities: | ||
Accounts receivable | (2,552) | (5,162) |
Due from related parties | (18,002) | (273) |
Prepaid expenses and other assets | 1,093 | 14 |
Right-of-use assets | 2,627 | 1,219 |
Accounts payable | 1,500 | 157 |
Accrued expenses | (1,051) | (4,187) |
Accrued compensation and benefits | 1,156 | 4,339 |
Due to related parties | (739) | (550) |
Other liabilities | (1,206) | 6,165 |
Deferred revenues | (205) | 1,455 |
Lease liabilities | (2,114) | (1,379) |
Net cash provided by operating activities | 43,946 | 40,704 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Acquisitions, net of cash acquired | 0 | (43,926) |
Purchase of intangible assets | 0 | (30) |
Note receivable | (1,456) | (2,270) |
Proceeds from note receivable | 7 | 0 |
Investments in unconsolidated subsidiaries | 0 | (2,638) |
Proceeds from investments in unconsolidated subsidiaries | 962 | 3,600 |
Software capitalization | (148) | 0 |
Post-closing payments related to acquisitions | 0 | (1,519) |
Purchases of property and equipment | (919) | (78) |
Net cash used in investing activities | (1,554) | (46,861) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Borrowings on debt obligations | 0 | 35,952 |
Repayments on debt obligations | (41,000) | (12,321) |
Repurchase of Class A common stock for employee tax withholding | (1,683) | 0 |
Payments to settle exercise of employee stock options | (72) | 0 |
Repurchase of Class A common stock | (1,485) | 0 |
Payment of preferred stock dividends | 0 | (720) |
Payments of contingent consideration | 0 | (518) |
Cash settlement of stock options | (12,466) | 0 |
Dividends paid | (7,041) | 0 |
Debt issuance costs | (1,365) | (942) |
Net cash (used in) provided by financing activities | (65,112) | 21,451 |
Net change in cash, cash equivalents and restricted cash | (22,720) | 15,294 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, beginning of period | 43,482 | 12,783 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, end of period | 20,762 | 28,077 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Cash paid for interest | 4,622 | 13,712 |
Net cash paid for income taxes | 738 | 4,637 |
NON-CASH OPERATING, INVESTING AND FINANCING ACTIVITIES | ||
Additions to right-of-use assets | 890 | 1,823 |
Additions to lease liabilities | 1,839 | 1,823 |
Additions to property and equipment | 949 | 0 |
Dividends declared | 1 | 0 |
RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH | ||
Cash and cash equivalents | 19,415 | 21,656 |
Restricted cash | 1,347 | 6,421 |
Total cash, cash equivalents and restricted cash | $ 20,762 | $ 28,077 |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | Note 1. Description of Business Description of Business On October 20, 2021, P10 Holdings, Inc. ("P10 Holdings"), in connection with its Initial Public Offering ("IPO"), completed a reorganization and restructure. In connection with the reorganization, P10, Inc. ("P10") became the parent company and all of the existing equity of P10 Holdings and its consolidated subsidiaries, including the convertible preferred units of P10 Intermediate, as defined below, were converted into common stock of P10. The offering and reorganization included a reverse stock split of P10 Holdings common stock on a 0.7-for-1 basis pursuant to which every outstanding share of common stock decreased to 0.7 shares. The number of shares have been retrospectively adjusted within these financial statements to reflect this stock split. The reorganization was considered a transaction between entities under common control. As a result, the consolidated financial statements for periods prior to the reorganization and IPO are the consolidated financial statements of P10 Holdings as the predecessor to P10 for accounting and reporting purposes. Following the reorganization and IPO, P10 has two classes of common stock, Class A common stock and Class B common stock. Each share of Class B common stock is entitled to ten votes while each share of Class A common stock is entitled to one vote. P10, Inc. and its consolidated subsidiaries (the “Company”) operate as a multi-asset class private market solutions provider in the alternative asset management industry. Our mission is to provide our investors differentiated access to a broad set of solutions and investment vehicles across a multitude of asset classes and geographies. Our existing portfolio of solutions across private equity, venture capital, private credit and impact investing support our mission by offering a comprehensive set of investment vehicles to our investors, including primary fund of funds, secondary investment, direct investment and co-investments, alongside separate accounts (collectively the “Funds”). The direct and indirect subsidiaries of the Company include P10 Holdings, P10 Intermediate Holdings, LLC (“P10 Intermediate”), which owns the subsidiaries P10 RCP Holdco, LLC (“Holdco”), Five Points Capital, Inc. (“Five Points”), TrueBridge Capital Partners, LLC (“TrueBridge”), Enhanced Capital Group, LLC (“ECG”), Bonaccord Capital Advisors, LLC ("Bonaccord"), Hark Capital Advisors, LLC ("Hark") and P10 Advisors, LLC ("P10 Advisors"). Prior to November 19, 2016, P10, formerly Active Power, Inc. designed, manufactured, sold, and serviced flywheel-based uninterruptible power supply products and serviced modular infrastructure solutions. On November 19, 2016, we completed the sale of substantially all our assets and liabilities and operations to Langley Holdings plc, a United Kingdom public limited company. Following the sale, we changed our name from Active Power, Inc. to P10 Industries, Inc. and became a non-operating company focused on monetizing our retained intellectual property and acquiring profitable businesses. For the period from December 2016 through September 2017, our business primarily consisted of cash, certain retained intellectual property assets and our net operating losses (“NOLs”) and other tax benefits. On March 22, 2017, we filed for re-organization under Chapter 11 of the Federal Bankruptcy Code, using a prepackaged plan of reorganization. The Company emerged from bankruptcy on May 3, 2017. On December 1, 2017, the Company changed its name from P10 Industries, Inc. to P10 Holdings, Inc. We were founded as a Texas corporation in 1992 and reincorporated in Delaware in 2000. Our headquarters is in Dallas, Texas. On October 5, 2017, we closed on the acquisition of RCP Advisors 2, LLC ("RCP 2") and entered into a purchase agreement to acquire RCP Advisors 3, LLC ("RCP 3") in January 2018. On January 3, 2018, we closed on the acquisition of RCP 3. RCP 2 and RCP 3 are registered investment advisors with the United States Securities and Exchange Commission. On April 1, 2020, the Company completed the acquisition of Five Points. Five Points is a leading lower middle market alternative investment manager focused on providing both equity and debt capital to private, growth-oriented companies and limited partner capital to other private equity funds, with all strategies focused exclusively in the U.S. lower middle market. Five Points is a registered investment advisor with the United States Securities and Exchange Commission. On October 2, 2020, the Company completed the acquisition of TrueBridge. TrueBridge is an investment firm focused on investing in venture capital through fund-of-funds, co-investments, and separate accounts. TrueBridge is a registered investment advisor with the United States Securities and Exchange Commission. On December 14, 2020, the Company completed the acquisition of 100% of the equity interest in ECG, and a noncontrolling interest in Enhanced Capital Partners, LLC (“ECP”) (collectively, “Enhanced”). Enhanced undertakes and manages equity and debt investments in impact initiatives across North America, targeting underserved areas and other socially responsible end markets including renewable energy, historic building renovations, and affordable housing. ECP is a registered investment advisor with the United States Securities and Exchange Commission. On September 30, 2021, the Company completed acquisitions of Bonaccord and Hark. Bonaccord is an alternative asset manager focusing on acquiring minority equity interests in alternative asset management companies focused on private market strategies which may include private equity, private credit, real estate, and real asset strategies. Hark is engaged in the business of making loans to portfolio companies that are owned or controlled by financial sponsors, such as private equity funds or venture capital funds, and which do not meet traditional direct lending underwriting criteria but where the repayment of the loan by the portfolio company is guaranteed by its financial sponsor. See Note 3 for additional information on these acquisitions. In June 2022, we formed P10 Advisors, a fully consolidated subsidiary, to manage investment opportunities that are sourced across the P10 platform but do not fit within an existing investment mandate. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Note 2. Significant Accounting Policies Basis of Presentation The accompanying Consolidated Financial Statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Management believes it has made all necessary adjustments so that the Consolidated Financial Statements are presented fairly and that estimates made in preparing the Consolidated Financial Statements are reasonable and prudent. The Consolidated Financial Statements include the accounts of the Company, its wholly owned or majority-owned subsidiaries and entities in which the Company is deemed to have a direct or indirect controlling financial interest based on either a variable interest model or voting interest model. All intercompany transactions and balances have been eliminated upon consolidation. The results for the nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the full year ending December 31, 2022. Certain entities in which the Company holds an interest are investment companies that follow specialized accounting rules under U.S. GAAP and reflect their investments at estimated fair value. Accordingly, the carrying value of the Company’s equity method investments in such entities retains the specialized accounting treatment. Principles of Consolidation The Company performs the variable interest analysis for all entities in which it has a potential variable interest. If the Company has a variable interest in the entity and the entity is a variable interest entity (“VIE”), we will also analyze whether the Company is the primary beneficiary of this entity and if consolidation is required. Generally, VIEs are entities that lack sufficient equity to finance their activities without additional financial support from other parties, or whose equity holders, as a group, lack one or more of the following characteristics: (a) direct or indirect ability to make decisions, (b) obligation to absorb expected losses or (c) right to receive expected residual returns. A VIE must be evaluated quantitatively and qualitatively to determine the primary beneficiary, which is the reporting entity that has (a) the power to direct activities of a VIE that most significantly impact the VIE's economic performance and (b) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. To determine a VIE's primary beneficiary, we perform a qualitative assessment to determine which party, if any, has the power to direct activities of the VIE and the obligation to absorb losses and/or receive its benefits. This assessment involves identifying the activities that most significantly impact the VIE's economic performance and determine whether we, or another party, has the power to direct those activities. When evaluating whether we are the primary beneficiary of a VIE, we perform a qualitative analysis that considers the design of the VIE, the nature of our involvement and the variable interests held by other parties. See Note 7 for further information. The Company has determined that certain of its subsidiaries are VIEs, and that the Company is the primary beneficiary of the entities, because it has the power to direct activities of the entities that most significantly impact the VIE’s economic performance and has a controlling financial interest in each entity. Accordingly, the Company consolidates these entities, which includes Holdco, RCP 2, RCP 3, TrueBridge, Bonaccord, and Hark. The assets and liabilities of the consolidated VIEs are presented on a gross basis in the Consolidated Balance Sheets. As a result of the reorganization, it was determined that P10 Intermediate no longer qualifies as a VIE, but would still be consolidated under the voting interest model. This change has been retrospectively adjusted. See Note 7 for more information on both consolidated and unconsolidated VIEs. Entities that do not qualify as VIEs are assessed for consolidation under the voting interest model. Under the voting interest model, the Company consolidates those entities it controls through a majority voting interest or other means. P10 Holdings, P10 Intermediate, Five Points, P10 Advisors and ECG are concluded to be consolidated subsidiaries of P10 under the voting interest model. Reclassifications Certain reclassifications have been made within the Consolidated Financial Statements to conform prior periods with current period presentation. Use of Estimates The preparation of the Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the dates of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Cash and Cash Equivalents The Company considers all highly liquid instruments with original maturities of three months or less to be cash equivalents. As of September 30, 2022, and December 31, 2021, cash equivalents include money market funds of $ 2.1 million and $ 10.7 million, respectively, which approximates fair value. The Company maintains its cash balances at various financial institutions, which may periodically exceed the Federal Deposit Insurance Corporation (“FDIC”) insured limits. The Company believes it is not exposed to any significant credit risk on cash. Restricted Cash Restricted cash as of September 30, 2022 and December 31, 2021 was primarily cash that is restricted due to certain deposits being held by the Company for its customers. Accounts Receivable and Due from Related Parties Accounts receivable is equal to contractual amounts reduced for allowances, if applicable. The Company considers accounts receivable to be fully collectible; accordingly, no allowance for doubtful accounts has been established as of September 30, 2022 and December 31, 2021. If accounts are subsequently determined to be uncollectible, they will be expensed in the period that determination is made. Due from related parties represents receivables from the Funds for reimbursable expenses. Additionally, fees owed to the Company for the advisory agreement entered into upon the closing of the acquisitions of ECG and ECP ("Advisory Agreement") where ECG provides advisory services to Enhanced Permanent Capital, LLC ("Enhanced PC") are reflected in due from related parties on the Consolidated Balance Sheets. These amounts are expected to be fully collectible. Note Receivable Note receivable is mostly related to contractual amounts owed from a signed, secured promissory note with BCP Partners Holdings, LP ("BCP"). In addition to contractual amounts, borrowers are obligated to pay interest on outstanding amounts. The Company considers the note receivable to be fully collectible; accordingly, no allowance for doubtful accounts has been established as of September 30, 2022 or December 31, 2021 . If accounts are subsequently determined to be uncollectible, they will be expensed in the period that determination is made. Investment in Unconsolidated Subsidiaries For equity investments in entities that we do not control, but over which we exercise significant influence, we use the equity method of accounting. The equity method investments are initially recorded at cost, and their carrying amount is adjusted for the Company’s share in the earnings or losses of each investee, and for distributions received. The Company evaluates its equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may not be recoverable. For certain entities in which the Company does not have significant influence and fair value is not readily determinable, we value these investments under the measurement alternative. Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 825 , Financial Instruments, requires equity securities to be recorded at cost and adjusted to fair value at each reporting period. However, the guidance allows for a measurement alternative, which is to record the investments at cost, less impairment, if any, and subsequently adjust for observable price changes of identical or similar investments of the same issuer. Property and Equipment Property and equipment are recorded at cost, less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized over the terms of the respective leases or service lives of the improvements, whichever is shorter, using the straight-line method. Expenditures for major renewals and betterments that extend the useful lives of the property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred. The estimated useful lives of the various assets are as follows: Computers and purchased software 3 - 5 years Furniture and fixtures 7 - 10 years Long-lived Assets Long-lived assets including property and equipment, lease right-of-use assets, and definite lived intangibles are evaluated for impairment under FASB ASC 360, Property, Plant, and Equipment . Long-lived assets are reviewed for possible impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The carrying value of long-lived assets are determined to not be recoverable if the undiscounted estimated future net operating cash flows directly related to the asset or asset group, including any disposal value, is less than the carrying amount of the asset. If the carrying value of an asset is determined to not be recoverable, the impairment loss is measured as the amount by which the carrying value of the asset exceeds its fair value on the measurement date. Fair value is based on the best information available, including prices for similar assets and estimated discounted cash flows. Leases The Company recognizes a lease liability and right-of-use asset in our Consolidated Balance Sheets for contracts that it determines are leases or contain a lease. The Company’s leases primarily consist of operating leases for various office spaces. Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the leases. The Company’s right-of-use assets and lease liabilities are recognized at lease commencement based on the present value of lease payments over the lease term. Lease right-of-use assets include initial direct costs incurred by the Company and are presented net of deferred rent, lease incentives and certain other existing lease liabilities. Absent an implicit interest rate in the lease, the Company uses its incremental borrowing rate, adjusted for the effects of collateralization, based on the information available at commencement in determining the present value of lease payments. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise those options. Lease expense is recognized on a straight-line basis over the lease term. Additionally, upon amendments or other events, the Company may be required to remeasure our lease liability and right-of-use asset. The Company does not recognize a lease liability or right-of-use asset on our Consolidated Balance Sheets for short-term leases. Instead, the Company recognizes short-term lease payments as an expense on a straight-line basis over the lease term. A short-term lease is defined as a lease that, at the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise. When determining whether a lease qualifies as a short-term lease, the Company evaluates the lease term and the purchase option in the same manner as all other leases. Goodwill and Intangible Assets Goodwill is initially measured as the excess of the cost of the acquired business over the sum of the amounts assigned to identifiable assets acquired, less the liabilities assumed. As of September 30, 2022, goodwill recorded on our Consolidated Balance Sheets relates to the acquisitions of RCP 2, RCP 3, Five Points, TrueBridge, Enhanced, Bonaccord, and Hark. As of September 30, 2022, the intangible assets are comprised of indefinite-lived intangible assets and finite-lived intangible assets related to the acquisitions of RCP 2, RCP 3, Five Points, TrueBridge, Enhanced, Bonaccord and Hark. Indefinite-lived intangible assets and goodwill are not amortized. Finite-lived technology is amortized using the straight-line method over its estimated useful life of 4 years . Finite-lived management and advisory contracts, which relate to acquired separate accounts and funds and investor/customer relationships with a specified termination date, are amortized in line with contractual revenue to be received, which range between 7 and 16 years . Certain of our trade names are considered to have finite-lives. Finite-lived trade names are amortized over 10 years in line with the pattern in which the economic benefits are expected to occur. Goodwill is reviewed for impairment at least annually as of September 30 utilizing a qualitative or quantitative approach and more frequently if circumstances indicate impairment may have occurred. The impairment testing for goodwill under the qualitative approach is based first on a qualitative assessment to determine if it is more likely than not that the fair value of the Company’s reporting unit is less than the respective carrying value. The reporting unit is the reporting level for testing the impairment of goodwill. If it is determined that it is more likely than not that a reporting unit’s fair value is less than its carrying value, then the difference is recorded as an impairment (not to exceed the carrying amount of goodwill). Contingent Consideration Contingent consideration is initially measured at fair value on the date of the acquisition. The liabilities are remeasured at fair value on each reporting date, with changes in the fair value reflected in operating expenses on our Consolidated Statements of Operations. As of September 30, 2022 and December 31, 2021, contingent consideration recorded relates to the acquisitions of Hark and Bonaccord on the Consolidated Balance Sheets. Debt Issuance Costs Costs incurred which are directly related to the issuance of debt are deferred and amortized using the effective interest method and are presented as a reduction to the carrying value of the associated debt on our Consolidated Balance Sheets. As these costs are amortized, they are included in interest expense, net within our Consolidated Statements of Operations. Treasury Stock The Company records common stock purchased for treasury at cost. At the date of subsequent reissuance, the treasury stock account is reduced by the cost of such stock using the average cost method. Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between independent and knowledgeable parties who are willing and able to transact for an asset or liability at the measurement date. We use valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs when determining fair value and then we rank the estimated values based on the reliability of the inputs used following the fair value hierarchy set forth by the FASB. As of September 30, 2022 and December 31, 2021, we used the following valuation techniques to measure fair value for assets and there were no changes to these methodologies during the periods presented: Level 1—Assets were valued using the closing price reported in the active market in which the individual security was traded. Level 2—Assets were valued using quoted prices in markets that are not active, broker dealer quotations, and other methods by which all significant inputs were observable at the measurement date. Level 3—Assets were valued using unobservable inputs in which little or no market data exists as reported by the respective institutions at the measurement date. The carrying values of financial instruments comprising cash and cash equivalents, prepaid assets, accounts payable, accounts receivable and due from related parties approximate fair values due to the short-term maturities of these instruments. The fair value of the credit and guarantee facility approximates the carrying value based on the interest rates which approximate current market rates. The Company has a contingent consideration liability related to the acquisitions of Hark and Bonaccord that is measured at fair value and is remeasured on a recurring basis. See Note 11 for additional information. Revenue Recognition Revenue is recognized when, or as, the Company transfers promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled to in exchange for those goods or services. While the determination of who is the customer in a contractual arrangement will be made on a contract-by-contract basis, the customer will generally be the investment fund for the Company’s significant management and advisory contracts. Management and Advisory Fees The Company earns management fees for asset management services provided to the Funds where the Company has discretion over investment decisions. The Company primarily earns fees for advisory services provided to clients where the Company does not have discretion over investment decisions. Management and advisory fees received in advance reflects the amount of fees that have been received prior to the period the fees are earned. These fees are recorded as deferred revenue on the Consolidated Balance Sheets. For asset management and advisory services, the Company typically satisfies its performance obligations over time as the services are rendered, since the customers simultaneously receive and consume the benefits provided as the Company performs the service. The transaction price is the amount of consideration to which the Company expects to be entitled based on the terms of the arrangement. For certain funds, management fees are initially calculated based on committed capital during the investment period and on net invested capital through the remainder of the fund’s term. Additionally, the management fee may step down for certain funds depending on the contractual arrangement. Advisory services are generally based upon fixed amounts and billed quarterly. Other advisory services include transaction and management fees associated with managing the origination and ongoing compliance of certain investments. Other Revenue Other revenue on our Consolidated Statements of Operations primarily consists of subscriptions, consulting agreements and referral fees. The subscription and consulting agreements typically have renewable one-year lives, and revenue is recognized ratably over the current term of the subscription or the agreement. If subscriptions or fees have been paid in advance, these fees are recorded as deferred revenue on our Consolidated Balance Sheets. Referral fee revenue is recognized upon closing of certain opportunities. Income Taxes Current income tax expense represents our estimated taxes to be paid or refunded for the current period. In accordance with ASC 740, Income Taxes (“ASC 740”), we recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities, as well as for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are recorded to reduce deferred tax assets to the amount we believe is more likely than not to be realized. Uncertain tax positions are recognized only when we believe it is more likely than not that the tax position will be upheld on examination by the taxing authorities based on the merits of the position. We recognize interest and penalties, if any, related to uncertain tax positions in income tax expense. We file various federal and state and local tax returns based on federal and state local consolidation and stand-alone tax rules as applicable. Earnings Per Share Basic earnings per share (“EPS”) is calculated by dividing net income attributable to common stockholders by the weighted-average number of common shares. Diluted EPS includes the determinants of basic EPS and common stock equivalents outstanding during the period adjusted to give effect to potentially dilutive securities. See Note 17 for additional information. Prior to the IPO, redeemable noncontrolling interests represented third party and related party interests in the Company's consolidated subsidiary, P10 Intermediate. Prior to the conversion of the redeemable convertible preferred shares issued by P10 Intermediate to class B shares, the numerator in the computation of diluted EPS was impacted by the redeemable convertible preferred shares. Under the if converted method, diluted EPS reflects a reduction in earnings that P10 would recognize by owning a smaller percentage of P10 Intermediate when the preferred shares are assumed to be converted. The denominator in the computation of diluted EPS is impacted by additional common shares that would have been outstanding if dilutive potential shares of common stock had been issued. Potential shares of common stock that may be issued by the Company include shares of common stock that may be issued upon exercise of outstanding stock options. Under the treasury stock method, the unexercised options are assumed to be exercised at the beginning of the period or at issuance, if later. The assumed proceeds are then used to purchase shares of common stock at the average market price during the period. Stock-Based Compensation Expense Stock-based compensation relates to grants for shares of P10 awarded to our employees through stock options as well as RSUs awarded to employees and RSAs issued to non-employee directors as compensation for service on the Company's board. RSUs and RSAs stock compensation expense are recorded ratably over the vesting period at the fair market value on the grant date. Stock option compensation cost is estimated at the grant date based on the fair-value of the award, which is determined using the Black Scholes option valuation model and is recognized as an expense ratably over the requisite service period of the award, generally five years . The share price used in the Black Scholes model is based on the trading price of our shares on the public markets. Expected life is based on the vesting period and expiration date of the option. Stock price volatility is estimated based on a group of similar publicly traded companies determined to be most reflective of the expected volatility of the Company due to the nature of operations of these entities. The risk-free rates are based on the U.S. Treasury yield in effect at the time of grant. Forfeitures are recognized as they occur. Segment Reporting The Company operates as an integrated private markets solution provider and a single operating segment. According to ASC 280, Disclosures about Segments of an Enterprise and Related Information , operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker(s) in deciding how to allocate resources and in assessing performance. Business Acquisitions In accordance with ASC 805, Business Combinations (“ASC 805”), the Company identifies a business to have three key elements; inputs, processes, and outputs. While an integrated set of assets and activities that is a business usually has outputs, outputs are not required to be present. In addition, all the inputs and processes that a seller uses in operating a set of assets and activities are not required if market participants can acquire the set of assets and activities and continue to produce outputs. In addition, the Company also performs a screen test to determine when a set of assets and activities is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets, the set of assets is not a business. If the set of assets and activities is not considered a business, it is accounted for as an asset acquisition using a cost accumulation model. In the cost accumulation model, the cost of the acquisition, including certain transaction costs, is allocated to the assets acquired on the basis of relative fair values. The Company includes the results of operations of acquired businesses beginning on the respective acquisition dates. In accordance with ASC 805, the Company allocates the purchase price of an acquired business to its identifiable assets and liabilities based on the estimated fair values using the acquisition method. The excess of the purchase price over the amount allocated to the assets and liabilities, if any, is recorded as goodwill. The excess value of the net identifiable assets and liabilities acquired over the purchase price of an acquired business is recorded as a bargain purchase gain. The Company uses all available information to estimate fair values of identifiable intangible assets and property acquired. In making these determinations, the Company may engage an independent third-party valuation specialist to assist with the valuation of certain intangible assets, notes payable, and tax amortization benefits. The consideration for certain of our acquisitions may include liability classified contingent consideration, which is determined based on formulas stated in the applicable purchase agreements. The amount to be paid under these arrangements is based on certain financial performance measures subsequent to the acquisitions. The contingent consideration included in the purchase price is measured at fair value on the date of the acquisition. The liabilities are remeasured at fair value on each reporting date, with changes in the fair value reflected in general, administrative and other on our Consolidated Statements of Operations. For business acquisitions, the Company recognizes the fair value of goodwill and other acquired intangible assets, and estimated contingent consideration at the acquisition date as part of purchase price. This fair value measurement is based on unobservable (Level 3) inputs. Dividends Dividends are reflected in the consolidated financial statements when declared. Recent Accounting Pronouncements The Company adopted ASU No. 2019-12, Income Taxes ("Topic 740") : Disclosure Framework - Simplifying the Accounting for Income Taxes , on January 1, 2021, which simplified the accounting for income taxes by removing certain exceptions to the general principles of Topic 740 and clarifying and amending existing guidance. The adoption of this standard did not have a material impact on our financial statements. Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 provides amendments to ASC 326, Financial Instruments - Credit Losses , which replaces the incurred loss impairment model with a current expected credit loss (“CECL”) model. CECL requires a company to estimate lifetime expected credit losses based on relevant information about historical events, current conditions and reasonable and supportable forecasts. The guidance must be applied using the modified retrospective adoption method on January 1, 2023, with early adoption permitted. We are evaluating the effects of these amendments on our financial reporting. On October 28, 2021, the FASB issued ASU 2021-08, which amends ASC 805 to “require acquiring entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination.” Under current GAAP, an acquirer generally recognizes such items at fair value on the acquisition date. The guidance is effective for fiscal years beginning after December 15, 2022. We are evaluating the effects of these amendments on our financial reporting. On June 30, 2022, the FASB issued ASU No. 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions ("ASU 2022-03"). The amendments in this Update affect all entities that have investments in equity securities measured at fair value that are subject to a contractual sale restriction. The amendments clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The amen d ments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The guidance is effective for fiscal years beginning after December 15, 2023. We are evaluating the effects of these amendments on our financial reporting. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2022 | |
Business Combinations [Abstract] | |
Acquisitions | Note 3. Acquisitions Acquisition of Bonaccord On September 30, 2021 , the Company completed the purchase of Bonaccord for total consideration of $ 56.4 million, which includes cash and contingent consideration. Bonaccord is engaged in the business of acquiring minority interests in alternative asset management companies focused on private market strategies which may include private equity, private client, real estate, and real asset strategies. The acquisition was accounted for as a business combination under the acquisition method of accounting pursuant to ASC 805. The following is a summary of consideration paid: Fair Value Cash $ 38,927 Contingent consideration 17,435 Total purchase consideration $ 56,362 A total of $ 35.0 million of the cash consideration was financed through an amendment to the term loan under the Credit and Guarantee Facility ("the Facility") with HPS Investment Partners, LLC ("HPS"). The additional draw had the same terms as the existing Facility, including the maturity date. Included in total consideration is $ 17.4 million of contingent consideration, representing the fair value of expected future payments on the date of the acquisition. The amount ultimately owed to the sellers is based on achieving specific fundraising targets and any amounts paid to the sellers will be paid by October 2027, at which point the contingent consideration expires. Total contingent consideration payments will not exceed $ 20.0 million. The fair value was derived from an analysis of the option pricing model and the scenario based model. The assumptions used in the analysis are inherently subjective; therefore, the ultimate amount of the liability may differ materially from the current estimate. As of September 30, 2022, the estimated fair value of the remaining contingent consideration totaled $ 19.3 million , with the increase since acquisition driven primarily by changes in the Company's borrowing rate due to the debt refinancing. See Note 11 for more details. In connection with the acquisition, the Company incurred a total of $ 0.7 million of acquisition-related expenses. Of the total acquisition-rel ated expenses, $ 0 and $ 0.2 million wer e recorded during the three and nine months ended September 30, 2022, respectively, and $ 0.3 million and $ 0.3 million for t he three and nine months ended September 30, 2021, respectively. These costs are included in professional fees on the Consolidated Statements of Operations. The following table presents the fair value of the net assets acquired as of the acquisition date: Fair Value ASSETS Prepaid expenses and other assets 9 Investment in partnership 1,396 Intangible assets 12,940 Total assets acquired $ 14,345 LIABILITIES Accrued expenses $ 919 Total liabilities assumed $ 919 Net identifiable assets acquired $ 13,426 Goodwill 42,936 Net assets acquired $ 56,362 The following table presents the fair value of the identifiable intangible assets acquired: Weighted- Average Amortization Fair Value Period Value of management and advisory contracts $ 9,450 8 Value of trade name 3,490 10 Total identifiable intangible assets $ 12,940 In connection with the acquisition, Bonaccord assumed a Strategic Alliance Agreement ("SAA"), providing a third-party the right to receive 15 % of the net management fee earnings, which includes the management fees minus applicable expenses, for Bonaccord Fund I ("Fund I") and any subsequent fund, paid quarterly, in exchange for funding certain amounts of capital commitments to the fund. See Note 5 for more information. Goodwill The goodwill recorded as part of the acquisition includes the expected benefits that management believes will result from the acquisition, including the Company’s build out of its investment product offering. Approximately $ 42.9 million of goodwill is expected to be deductible for tax purposes. Acquisition of Hark On September 30, 2021 , the Company completed the purchase of Hark for total consideration of $ 7.2 million, which includes $ 5.0 million of cash and $ 2.2 million of estimated contingent consideration, with the fair value based on the scenario based method. The acquisition was accounted for as a business combination under the acquisition method of accounting pursuant to ASC 805. Hark is engaged in the business of making loans to portfolio companies that are owned or controlled by financial sponsors, such as private equity funds or venture capital funds, and which do not meet traditional direct lending underwriting criteria, but where the repayment of the loan by the portfolio company is guaranteed by its financial sponsor. T he fair value consisted of $ 2.5 million in net assets and $ 4.7 million in goodwill. The total contingent consideration payment will not exceed $ 5.4 million. Identifiable Intangible Assets The fair value of management and advisory contracts acquired were estimated using the excess earnings method. Significant inputs to the valuation model include existing revenue, estimates of expenses and contributory asset charges, the economic life of the contracts and a discount rate based on a weighted average cost of capital. The fair value of trade names acquired were estimated using the relief from royalty method. Significant inputs to the valuation model include estimates of existing and future revenue, estimated royalty rate, economic life and a discount rate based on a weighted average cost of capital. The fair value of technology acquired was estimated using the relief from royalty method. Significant inputs to the valuation model include a royalty rate, an estimated life and a discount rate. The management and advisory contracts, trade names and the acquired technology all have a finite useful life. The carrying value of the management fund and advisory contracts and trade names will be amortized in line with the pattern in which the economic benefits arise and are reviewed at least annually for indicators of impairment in value that is other than temporary. The technology will be amortized on a straight-line basis. Pro-forma Financial Information The following unaudited pro forma condensed consolidated results of operations of the Company assumes the acquisition of Bonaccord was completed on January 1, 2021: For the Nine Months 2022 2021 Revenue $ 140,015 $ 120,057 Net income attributable to P10 24,563 12,749 Pro forma adjustments include revenue and net income of the acquired business for each period. Other pro forma adjustments include intangible amortization expense and interest expense based on debt issued or repaid in connection with the acquisition as if the acquisition was completed on January 1, 2021. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Note 4. Revenue The following presents revenues disaggregated by product offering: For the Three Months For the Nine Months 2022 2021 2022 2021 Management and advisory fees $ 49,479 $ 37,939 $ 138,957 $ 104,029 Subscriptions 165 153 493 486 Other revenue 352 53 565 386 Total revenues $ 49,996 $ 38,145 $ 140,015 $ 104,901 |
Strategic Alliance Expense
Strategic Alliance Expense | 9 Months Ended |
Sep. 30, 2022 | |
Business Combination, Separately Recognized Transactions [Abstract] | |
Strategic Alliance Expense | Note 5. Strategic Alliance Expense In connection with the Bonaccord acquisition, Bonaccord assumed a SAA. This SAA provides the third-party the right to receive 15 % of the net management fee earnings, which includes the management fees minus applicable expenses, for Fund I and subsequent funds, paid quarterly, in exchange for funding certain amounts of capital commitments to the fund. Net management fee earnings the third-party has the right to receive is based on the total capital committed. Within 60 days following the final closing of the next fund, Bonaccord Fund II ("Fund II"), the third-party has the opportunity to acquire, at the price at the time of the original acquisition, equity interests in Bonaccord based on the amount of commitment made. For each $ 5.0 million, up to a maximum of $ 250.0 million in irrevocable capital commitments to Fund II, the third-party can acquire 10 basis points up to a maximum of 5 % equity. In addition, net management fee earnings would increase by the same percentage, retroactive to the date of the first close in Fund II. The maximum commitment requirement has been met as of September 30, 2022. The Company believes its probable that the third-party will exercise the option to acquire equity in Bonaccord and has begun to accrue an additional 5 % of net management fee earnings. If executed, the purchase price shall be reduced by the amount of management fee distributions which the third-party would have been paid as of the initial closing of Fund II. Similar terms apply for Fund III with the exception that the third-party can acquire 9.8 basis points for every $ 5.0 million committed up to 4.9 %. This commitment has not yet been met as of September 30, 2022 as Fund III has not yet had its final close. If commitment conditions to funds subsequent to Funds II and III are not satisfied, then within 60 days of the final closing of such subsequent fund giving rise to the condition not being satisfied, the Company may elect to repurchase the equity granted to the third-party. The repurchase shall be at the fair market value of such equi ty at that point in time. For the three and nine months ended September 30, 2022, the strategic alliance expense reported was $ 0.1 million and $ 0.4 million, res pectively. In the three and nine months ended September 30, 2021, there was no strategic alliance expense. This is reported on the Consolidated Statements of Operations as strategic alliance expense in operating expenses. |
Note Receivable
Note Receivable | 9 Months Ended |
Sep. 30, 2022 | |
Receivables [Abstract] | |
Note Receivable | Note 6. Note Receivable The Company's note receivable consists of an Advance Agreement and Secured Promissory Note that was executed on September 30, 2021 between the Company and BCP to lend funds to certain employees to be used to pay general partner commitments to certain funds managed by Bonaccord. This agreement provides for a note to BCP for $ 5.0 million with a maturity date of September 30, 2031 . The note will earn interest at the greater of (i) the applicable federal rate that must be charged to avoid imputation of interest under Section 1274(d) of the U.S. Internal Revenue Code and (ii) 5.5 %. Interest will be paid on December 31st of each year commencing December 31, 2021, with any unpaid accrued interest being capitalized and added to the outstanding principal balance. There was no cash paid for interest as of December 31, 2021 and the outstanding balance was capitalized to the note receivable. Principal payments will be made periodically as mandatorily required payments from available cash flows at BCP. As of September 30, 2022 and December 31, 2021, the outstanding balance was $ 4.0 million and $ 2.6 million, respectively. The Company recognized interest income of $ 0.1 million and $ 0.1 million for the three and nine months ended September 30, 2022, respectively. The Company recognized no interest income for the three and nine months ended September 30, 2021. This is presented in other revenue on the Consolidated Statement of Operations. |
Variable Interest Entities
Variable Interest Entities | 9 Months Ended |
Sep. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | Note 7. Variable Interest Entities Consolidated VIEs The Company consolidates certain VIEs for which it is the primary beneficiary. VIEs consist of certain operating entities not wholly owned by the Company and include Holdco, RCP 2, RCP 3, TrueBridge, Hark and Bonaccord. See Note 2 for more information on the Company’s accounting policies related to the consolidation of VIEs. The assets of the consolidated VIEs totale d $ 393.7 million and $ 413.2 million as of September 30, 2022 and December 31, 2021, respectively. The liabilities of the consolidated VIEs totale d $ 51.6 million and $ 53.6 million as of September 30, 2022 and December 31, 2021, respectively. The assets of our consolidated VIE’s are owned by those entities and not generally available to satisfy P10’s obligations, and the liabilities of our consolidated VIE’s are obligations of those entities, and their creditors do not generally have recourse to the assets of P10. Unconsolidated VIEs Through its subsidiary, ECG, the Company holds variable interests in the form of direct equity interests in certain VIEs that are not consolidated because the Company is not the primary beneficiary. The Company's maximum exposure to loss is limited to the potential loss of assets recognized by the Company relating to these unconsolidated entities. |
Investment In Unconsolidated Su
Investment In Unconsolidated Subsidiaries | 9 Months Ended |
Sep. 30, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in Unconsolidated Subsidiaries | Note 8. Investment in Unconsolidated Subsidiaries The Company’s investment in unconsolidated subsidiaries consist of equity method investments primarily related to ECG’s tax credit finance and asset management activities. As of September 30, 2022, investment in unconsolidated subsidiaries total ed $ 2.1 million, of which $ 1.9 million r elated to ECG’s asset management businesses an d $ 0.2 million r elated to ECG’s tax credit finance businesses. As of December 31, 2021, investment in unconsolidated subsidiaries t otaled $ 1.8 million, of which $ 1.6 million related to ECG’s asset management businesses and $ 0.2 million relate d to ECG’s tax credit finance businesses. Asset Management ECG manages some of its alternative asset management funds through various unconsolidated subsidiaries and records these investments under the equity method of accounting. ECG recorded its share of income in the amount of $ 0.2 million and $ 1.3 million for the thr ee and nine months ended September 30, 202 2, respectively, and $ 0.3 million and $ 0.8 million f or the three and nine months ended September 30, 2021, respectively. For the three and nine months ended September 30, 2022, ECG made $ 0 and $ 0 capital contributions and received distributions of $ 0.3 million and $ 1.0 million, resp ectively. Tax Credit Finance ECG provides a wide range of tax credit transactions and consulting services through various entities which are wholly owned subsidiaries of Enhanced Tax Credit Finance, LLC (“ETCF”), which is a wholly owned subsidiary of ECG. Some of these subsidiaries own nominal interests, typically un der 1.0%, in various VIEs and record these investments under the measurement alternative described in Note 2 above. For the three and nine months ended September 30, 2022, ECG made $ 0 and $ 0 of capital contributions and received distributions of $ 0 and $ 0 , respectively. |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Note 9. Property and Equipment Property and equipment consist of the following: As of September 30, As of December 31, 2022 2021 Computers and purchased software $ 580 $ 387 Furniture and fixtures 885 461 Leasehold improvements 1,632 601 Other 3 3 $ 3,100 $ 1,452 Less: accumulated depreciation ( 587 ) ( 471 ) Total property and equipment, net $ 2,513 $ 981 |
Goodwill and Intangibles
Goodwill and Intangibles | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangibles | Note 10. Goodwill and Intangibles Changes in goodwill for the nine months ended September 30, 2022 is as follows: Balance at December 31, 2021 $ 418,701 Purchase price adjustment ( 11 ) Increase from acquisitions - Balance at September 30, 2022 $ 418,690 Intangibles consists of the following: As of September 30, 2022 Gross Carrying Accumulated Net Carrying Indefinite-lived intangible assets: Trade names $ 17,350 $ — $ 17,350 Technology 30 — 30 Total indefinite-lived intangible assets 17,380 — 17,380 Finite-lived intangible assets: Trade names 21,440 ( 2,991 ) 18,449 Management and advisory contracts 151,166 ( 77,802 ) 73,364 Technology 2,359 ( 1,103 ) 1,256 Total finite-lived intangible assets 174,965 ( 81,896 ) 93,069 Total intangible assets $ 192,345 $ ( 81,896 ) $ 110,449 As of December 31, 2021 Gross Carrying Accumulated Net Carrying Indefinite-lived intangible assets: Trade names $ 17,350 $ — $ 17,350 Technology 30 — 30 Total indefinite-lived intangible assets 17,380 — 17,380 Finite-lived intangible assets: Trade names 21,440 ( 1,785 ) 19,655 Management and advisory contracts 151,166 ( 60,934 ) 90,232 Technology 8,160 ( 6,639 ) 1,521 Total finite-lived intangible assets 180,766 ( 69,358 ) 111,408 Total intangible assets $ 198,146 $ ( 69,358 ) $ 128,788 Management and advisory contracts and finite lived trade names are amortized over 7 - 16 years and are being amortized in line with pattern in which the economic benefits that are expected to occur. Technology is amortized on a straight-line basis over 4 years. The amortization expense for each of the next five years and thereafter are as follows: Remainder of 2022 $ 6,160 2023 21,155 2024 17,590 2025 13,807 2026 10,878 Thereafter 23,479 Total amortization $ 93,069 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 11. Fair Value Measurements The Company measures certain liabilities at fair value on a recurring basis. The following tables provide details regarding the classification of these liabilities within the fair value hierarchy as of the dates presented: As of September 30, 2022 Level I Level II Level III Total Liabilities Contingent consideration obligation $ - $ - $ 24,330 $ 24,330 Total liabilities $ - $ - $ 24,330 $ 24,330 As of December 31, 2021 Level I Level II Level III Total Liabilities Contingent consideration obligation $ - $ - $ 22,963 $ 22,963 Total liabilities $ - $ - $ 22,963 $ 22,963 For the liabilities presented in the tables above, there were no changes in fair value hierarchy levels during the periods ended September 30, 2022 and December 31, 2021. The changes in the fair value of Level III financial instruments are set forth below: Contingent Consideration Liability For the Nine Months Ended September 30, For the Nine Months Ended September 30, 2022 2021 Balance, beginning of year: $ 22,963 $ 593 Additions - 19,160 Change in fair value 1,367 134 Settlements - ( 727 ) Balance, end of period: $ 24,330 $ 19,160 The fair value of the contingent consideration liability represents the fair value of future payments upon satisfaction performance targets. The assumptions used in the analysis are inherently subjective; therefore, the ultimate amount of the contingent consideration liability primarily relate to the expected future payments of obligations with a discount rate applied. The contingent consideration liability is included in contingent consideration on the Consolidated Balance Sheets. Changes in the fair value of the liability are included in contingent consideration expense on the Consolidated Statements of Operations. |
Debt Obligations
Debt Obligations | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Debt Obligations | Note 12. Debt Obligations Debt obligations consists of the following: As of As of September 30, December 31, 2022 2021 Gross revolving credit facility state tax credits $ — $ - Debt issuance costs — ( 8 ) Revolving credit facility state tax credits, net $ — $ ( 8 ) Revolver facility $ 49,900 $ 90,900 Debt issuance costs ( 2,833 ) ( 2,981 ) Revolver facility, net $ 47,067 $ 87,919 Term Loan $ 125,000 $ 125,000 Debt issuance costs ( 1,293 ) ( 415 ) Term loan, net $ 123,707 $ 124,585 Total debt obligations $ 170,774 $ 212,496 The table below summarizes the terms of the debt obligations. September 30, 2022 Weighted Maturity Date Aggregate Facility Size Outstanding Debt Amount Available Net Carrying Value Average Interest Rate Term Loan 12/22/2025 $ 125,000 $ 125,000 $ — $ 123,707 2.35 % Revolver Facility 12/22/2025 125,000 49,900 75,100 47,067 3.03 % Total $ 250,000 $ 174,900 $ 75,100 $ 170,774 Refinancing On December 22, 2021, the Company extinguished its debt outstanding with HPS, as described below in the Credit and Guaranty Facility section and simultaneously entered into a new credit agreement with JP Morgan Chase Bank, N.A. ("JP Morgan") in order to gain more favorable interest terms. The Company used the proceeds from the new credit agreement with JP Morgan not only to repay the outstanding balance with HPS but also to repay the notes payable to sellers as described below in the Notes Payable to Sellers section. Revolving Credit Facility State Tax Credits Enhanced State Tax Credit Fund III, LLC, a subsidiary of ECG, had a $ 10 million revolving credit facility with a regional financial institution restricted solely for the purchase of allocable state tax credits from various state tax credit incentive programs. The facility bore interest at 0.25 % above the Prime Rate and matured on June 15, 2022 . The facility was not renewed upon maturity. There was no outstanding balance nor any interest incurred as of December 31, 2021. Notes Payable to Sellers On October 5, 2017, the Company issued Secured Promissory Notes Payable (“2017 Seller Notes”) in the amount of $ 81.3 million to the owners of RCP 2 in connection with the acquisition of that entity. The 2017 Seller Notes were set to mature on January 15, 2025 . On December 23, 2021, the Company used the proceeds from the new credit agreement with JP Morgan to repay the outstanding balance of the 2017 Sellers Notes. On January 3, 2018, the Company issued Secured Promissory Notes Payable (“2018 Seller Notes”) in the amount of $ 22.1 million to the owners of RCP 3 in connection with the acquisition of that entity. The 2018 Seller Notes were set to mature on January 15, 2025 . On December 23, 2021, the Company used the proceeds from the new credit agreement with JP Morgan to repay the outstanding balance of the 2018 Sellers Notes. On January 3, 2018, the Company issued tax amortization benefits in the amount of $ 48.4 million (“TAB Payments”) to the owners of RCP 3 in connection with the acquisition of that entity. The TAB Payments were set to mature on April 15, 2023 . On December 23, 2021, the Company used the proceeds from the new credit agreement with JP Morgan to repay the outstanding balance of the TAB Payments. The 2017 Seller Notes, the 2018 Seller Notes and the TAB Payments are collectively referred to as “Notes payable to sellers” on our Consolidated Financial Statements. Non-cash interest expense was recorded on a periodic basis for the Notes payable to sellers. During the three and nine months ended September 30, 2022, we recorded $ 0 and $ 0 , respectively, and for the three and nine months ended September 30, 2021 , we recorded $ 0.3 million and $ 0.7 million, resp ectively, in interest expense related to the TAB Payments. Credit and Guaranty Facility The Company’s subsidiary, Holdco, entered into the Credit and Guaranty Facility (the "Facility") with HPS as administrative agent and collateral agent on October 7, 2017. The Facility initially provided for a $ 130.0 million senior secured credit facility in order to refinance the existing debt obligations of RCP Advisors and provide for the financing to repay the Seller Notes due resulting from the acquisition of RCP Advisors. The Facility provided for a $ 125 million five-year term, subject to certain EBITDA levels and conditions, and a $ 5 million one-year line of credit. The line of credit was repaid and subsequently expired during 2018. Holdco was permitted to draw up to $ 125 million in aggregate on the term loan in tranches through July 31, 2019 . On October 2, 2020 and December 14, 2020, in connection with the acquisitions of TrueBridge and Enhanced, the term loan under the Facility was amended adding an additional $ 91.4 million and $ 68.0 million to the Facility, respectively. On September 30, 2021, in connection with the acquisition of Bonaccord, the term loan under the Facility was amended adding an additional $ 35.0 million to the Facility. On October 28, 2021, a payment of $ 88.6 million was made on the Facility, which included an optional repayment of $ 86.8 million, required prepayment penalty of $ 1.2 million, and an accrued interest payment of $ 0.6 million. On December 22, 2021, the remaining principal balance under the Facility of $ 200 million was repaid using the proceeds of the new credit facility with JP Morgan. In accordance with the Facility, the Company also paid the remaining accrued interest balance of $ 2.1 million and an early extinguishment fee of $ 3.7 million. Revolving Credit Facility and Term Loan On December 22, 2021, the Company entered into a new credit agreement (the "Credit Agreement") with JPMorgan, in its capacity as administrative agent and collateral agent, and Texas Capital Bank, as joint lead arrangers and joint bookrunners, and the other loan parties party thereto. The Credit Agreement consists of two facilities. The first is a revolving credit facility with an available balance of $ 125 million (the "Revolver Facility"). The second is a term loan for $ 125 million (the "Term Loan"). In addition to the Term Loan and Revolver Facility, the Credit Agreement also includes a $ 125 million accordion feature. Both facilities are "Term SOFR Loans" meaning loans bearing interest based upon the "Adjusted Term SOFR Rate". The Adjusted Term SOFR Rate is the Secured Overnight Financing Rate ("SOFR") at the date of election, plus 2.10 %. The Company can elect one or three months for the Revolver Facility and three or six months for the Term Loan. Principal is contractually repaid at a rate of 1.25 % on the term loan quarterly effective March 31, 2023. The Revolving Credit Facility has no contractual principal repayments until maturity, which is December 22, 2025 for both facilities. Certain P10 subsidiaries are encumbered by this debt agreement. The Credit Agreement contains affirmative and negative covenants typical of such financing transactions, and specific financial covenants which require P10 to maintain a minimum leverage ratio. As of September 30, 2022, P10 was in compliance with its financial covenants required under the facility. As of September 30, 2022, the balance drawn on the revolving credit facility is $ 49.9 million and on the term loan, the balance is $ 125.0 million. The balance as of December 31, 2021 was $ 90.9 million on the revolving credit facility and $ 125 million on the term loan. For the three and nine months ended September 30, 2022, $ 2.1 million and $ 4.6 million of interest expense was incurred, respectively. In September 2022, the Company exercised the accordion feature on the Credit Agreement. The principal was not drawn on the accordion until the fourth quarter of 2022, however, the Company incurred $ 1.4 million of debt issuance costs in September associated with the exercise. Debt Payable Future principal maturities of debt as of September 30, 2022 are as follows: 2022 $ — 2023 6,250 2024 6,250 2025 162,400 $ 174,900 Debt Issuance Costs Debt issuance costs are offset against the Revolving Credit Facility State Tax Credits, the Credit and Guaranty Facility, and the Revolver Facility and Term Loan. Unamortized debt issuance costs for the Credit and Guaranty Facility as of September 30, 2022 and December 31, 2021 were $ 0 and $ 0 , respectively. Unamortized debt issuance costs for the Revolving Credit Facility State Tax Credits as of September 30, 2022 and December 31, 2021 were $ 0 and $ 8 thousand, respectively. Unamortized debt issuance costs for the Revolver Facility and Term Loan as of September 30, 2022 and December 31, 2021 were $ 4.1 million and $ 3.4 million, respectively. This is included in debt obligations on the consolidated balance sheets. Amortization expense related to debt issuance costs totaled $ 0.2 million and $ 0.6 million for the three and nine months ended September 30, 2022, respectively, and $ 0.7 million and $ 2.1 million for the three and nine months ended September 30, 2021, respectively, and are included within interest expense, net on the accompanying Consolidated Statements of Operations. During the nine months ended September 30, 2022 and September 30, 2021 , we recorded $ 1.4 million and $ 0.9 million in debt issuance costs, respectively, which is included in debt obligations on the consolidated balance sheets. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2022 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 13. Related Party Transactions Effective January 1, 2021, the Company entered into a sublease with 210 Capital, LLC, a related party, for office space serving as our corporate headquarters. The monthly rent expense is $ 20.3 thousand, and the lease expires December 31, 2029 . P10 has paid $ 0.2 million and $ 0.2 million in rent to 210 Capital, LLC for the nine months ended September 30, 2022 and September 30, 2021, respectively. Effective April 1, 2020, P10 Intermediate paid a quarterly management fee of $ 250 thousand to Keystone Capital XXX, LLC, which was the holder of the Series B preferred shares issued by P10 Intermediate in connection with the acquisition of Five Points. As a result of that agreement, P10 Intermediate paid $ 0.1 million and $ 0.8 million for the nine months ended September 30, 2022 and September 30, 2021, respectively. This management fee was terminated effective October 20, 2021 when the Company's redeemable noncontrolling interest was converted to shares of Class B common stock in connection with the Company's IPO. As described in Note 1, through its subsidiaries, the Company serves as the investment manager to the Funds. Certain expenses incurred by the Funds are paid upfront and are reimbursed from the Funds as permissible per fund agreements. As of September 30, 2022, the total accounts receivable from the Funds totaled $ 6.4 million , of which $ 4.2 million related to reimbursable expenses and $ 2.2 million related to fees earned but not yet received. As of December 31, 2021 , the total accounts receivable from the Funds totaled $ 2.4 million, of which $ 1.6 million related to reimbursable expenses and $ 0.8 million related to fees earned but not yet received. In certain instances, the Company may incur expenses related to specific products that never materialize. The costs are then removed from the balance sheet and expensed on the Consolidated Statement of Operations. The management fees described here are included in accounts receivable on the Consolidated Balance Sheet and the reimbursable expenses are included in due from related parties on the Consolidated Balance Sheets. Upon the closing of the Company’s acquisition of ECG and ECP, the Advisory Agreement between ECG and Enhanced PC immediately became effective. Under this agreement, ECG provides advisory services to Enhanced PC related to the assets and operations of the permanent capital subsidiaries owned by Enhanced PC, as contributed by both ECG and ECP, and new projects undertaken by Enhanced PC. In exchange for those services, which commenced on January 1, 2021, ECG receives advisory fees from Enhanced PC based on a declining fixed fee schedule, initially totaling $ 76.0 million over 7 years . As a result of new projects during 2021, ECG will receive additional advisory fees from Enhanced PC totaling $ 22.0 million over 7 years , based on a declining fixed fee schedule. This agreement is subject to customary termination provisions. For the three and nine months ended September 30, 2022, advisory fees earned or recognized under this agreement were $ 5.5 million and $ 16.6 million, respectively, and are reported in management and advisory fees on the Consolidated Statement of Operations. For the three and nine months ended September 30, 2021, advisory fees earned or recognized under this agreement were $ 4.8 million and $ 14.3 million, respectively. As of September 30, 2022 and December 31, 2021, the receivable balance was $ 23.0 million and $ 9.5 million, respectively, and is included in due from related parties on the Consolidated Balance Sheets. Upon the closing of the Company’s acquisition of ECG and ECP, the Administrative Services Agreement between ECG and Enhanced Capital Holdings, Inc. (“ECH”), the entity which holds a controlling equity interest in ECP, immediately became effective. Under this agreement, ECG will pay ECH for the use of their employees to provide services to Enhanced PC at the direction of ECG. The Company recognized $ 3.3 million and $ 7.9 million for the three and nine months ended September 30, 2022, respectively, and $ 0.9 million and $ 6.1 million for the three and nine months ended September 30, 2021, respectively, related to this agreement within compensation and benefits on our Consolidated Statements of Operations. On September 10, 2021, ECG entered into a strategic partnership with Crossroads Impact Corp. ("Crossroads"), parent company of Capital Plus Financial ("CPF"), a leading certified development financial institution. Under the terms of the agreement, Enhanced will originate and manage loans across its diverse lines of business including small business loans to women and minority owned businesses, and loans to renewable energy and community development projects. The loans will be held by CPF and CPF will pay an advisory fee to Enhanced. The Company recognized $ 1.2 million and $ 2.2 million for the three and nine months ended September 30, 2022, respectively, which is included in management and advisory fees on the Consolidated Statements of Operations. No revenues were recognized for the three and nine months ended September 30, 2021. On July 6, 2022, Crossroads entered into a Common Stock Purchase Agreement (the “Commenda Purchase Agreement”) with P10 Commenda Impact Fund Onshore, LLC and P10 Commenda Impact Fund Offshore, LLC (together, the “Commenda Funds”). Pursuant to the terms of the Commenda Purchase Agreement, on July 6, 2022, Crossroads issued 4,646,840 shares of Crossroads common stock to the Commenda Funds for $ 10.76 per shares, for an aggregate amount of approximately $ 50 million. Pursuant to the terms of the Commenda Purchase Agreement, on August 1, 2022, Crossroads closed on the sale of an additional 1,394,052 shares of Crossroads common stock to the Commenda Funds at $ 10.76 per share. P10 Advisors, LLC, an affiliate of the Company, is the investment advisor to the Commenda Funds. Robert Alpert and C. Clark Webb are directors of Crossroads. The Company recognized $ 0.1 million and $ 0.1 million for the three and nine months ended September 30, 2022, respectively, which is included in management and advisory fees on the Consolidated Statements of Operations. No revenues were recognized for the three and nine months ended September 30, 2021. On July 11, 2022, Crossroads entered into an Amended and Restated Advisory Agreement (the “Amended Advisory Agreement”) with ECG. The Amended Advisory Agreement provides for ECG to receive a services fee of 1.5 % per year of the capital deployed by Crossroads under the Amended Advisory Agreement ( 0.375 % quarterly), and an incentive fee of 15 % over a 7 % hurdle rate. Upon the closing of the Bonaccord acquisition on September 30, 2021, an Advance Agreement and Secured Promissory Note was signed with BCP, an entity that was formed by employees of the Company. For details, see Note 6. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 14. Commitments and Contingencies Operating Leases The Company leases office space and various equipment under non-cancelable operating leases, with the longest lease expiring in 2032. These lease agreements provide for various renewal options. Rent expense for the various leased office space and equipment was approximate ly $ 0.8 million and $ 2.4 million f or the three and nine months ended September 30, 2022, and $ 0.5 million and $ 1.6 million f or the three and nine months ended September 30, 2021, respectively. The following table presents information regarding the Company’s operating leases as of September 30, 2022: Operating lease right-of-use assets $ 13,052 Operating lease liabilities $ 15,425 Cash paid for lease liabilities $ 1,690 Weighted-average remaining lease term (in years) 7.47 Weighted-average discount rate 4.47 % The future contractual lease payments as of September 30, 2022 are as follows: Remainder of 2022 $ 538 2023 2,976 2024 3,222 2025 2,066 2026 1,727 Thereafter 8,977 Total undiscounted lease payments 19,506 Less discount ( 3,121 ) Less construction allowance ( 960 ) Total lease liabilities $ 15,425 Contingencies We may be involved, either as plaintiff or defendant, in a variety of ongoing claims, demands, suits, investigations, tax matters and proceedings that arise from time to time in the ordinary course of our business. We evaluated all potentially significant litigation, government investigations, claims or assessments in which we are involved and do not believe that any of these matters, individually or in the aggregate, will result in losses that are materially in excess of amounts already recognized, if any. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 15. Income Taxes The Company calculates its tax provision using the estimated annual effective tax rate methodology. The tax expense or benefit caused by an unusual or infrequent item is recorded in the quarter in which it occurs. To the extent that information is not available for the Company to fully determine the full year estimated impact of an item of income or tax adjustment, the Company calculates the tax impact of such item discretely. Based on these methodologies, the Company’s effective income tax rate for the nine months ended September 30, 2022 was 25.90 %. The effective tax rate differs from the federal statutory rate of 21 % due primarily to state and local income taxes. The Company records deferred tax assets and liabilities for the future tax benefit or expense that will result from differences between the carrying value of its assets for income tax purposes and for financial reporting purposes, as well as for operating loss and tax credit carryovers. A valuation allowance is recorded to bring the net deferred tax assets to a level that, in management's view, is more likely than not to be realized in the foreseeable future. This level will be estimated based on a number of factors, especially the amount of net deferred tax assets of the Company that are actually expected to be realized, for tax purposes, in the foreseeable future. As of September 30, 2022, the Company has recorded a $ 12.8 million valuation allowance against deferred tax assets, primarily related to a note impairment. There was no change to the valuation allowance during the nine months ended September 30, 2022. The Company monitors federal and state legislative activity and other developments that may impact our tax positions and their relation to the income tax provision. Any impacts will be recorded in the period in which the legislation is enacted or new regulations are issued. The Company is subject to examination by the United States Internal Revenue Service as well as state and local tax authorities. The Company is not currently under audit. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Stockholders' Equity | Note 16. Stockholders' Equity Equity-Based Compensation On July 20, 2021, the Board of Directors approved the P10 Holdings, Inc. 2021 Stock Incentive Plan (the "Plan"), which replaced the 2018 Incentive Plan ("2018 Plan"), our previously existing equity compensation plan. The Compensation Committee of the Board of Directors may issue equity-based awards including stock options, stock appreciation rights, restricted stock units and restricted stock awards. Options previously granted under the 2018 Plan cliff vest over a period of four or five years . The term of each option is no more than ten years from the date of grant. When the options are exercised, the Board of Directors has the option of issuing shares of common stock or paying a lump sum cash payment on the exercise date equal to the difference between the common stock’s fair market value on the exercise date and the option price. Terms of all future awards will be granted under the Plan, and no additional awards will be granted under the 2018 Plan. Awards granted under the 2018 Plan continue to follow the 2018 Plan. The 2018 Plan provided for an initial 6,300,000 shares (adjusted for the reverse stock split). The Plan provided for the issuance of 3,000,000 shares available for grant, in addition to those approved in the 2018 Plan for a total of 9,300,000 shares. On June 17, 2022, at the Annual Meeting of Stockholders, the shareholders authorized an additional 5,000,000 of shares from the Plan creating a total of 14,300,000 shares available for grant under the Plan and the 2018 Plan. On March 15, 2022, the Board of Directors approved the settlement of 1.1 million options from a grantee with a fair market value option price of $ 11.83 , less a negotiated discount of 2.5 %, totaling $ 12.5 million. This was paid on June 15, 2022. A summary of stock option activity for the nine months ended September 30, 2022 is as follows: Weighted Average Contractual Life Aggregate Number of Weighted Average Remaining Intrinsic Value Shares Exercise Price (in years) (whole dollars) Outstanding as of December 31, 2021 7,095,936 $ 3.71 7.45 $ 73,156,722 Granted 1,323,733 12.28 Exercised ( 41,570 ) 4.80 Settled ( 1,120,000 ) 0.41 Expired/Forfeited ( 29,985 ) 10.04 Outstanding as of September 30, 2022 7,228,114 $ 5.75 7.51 $ 37,496,331 Exercisable as of September 30, 2022 320,440 $ 3.83 6.04 $ 2,144,803 The weighted average assumptions used in calculating the fair value of stock options granted during the nine months ended September 30, 2022 and September 30, 2021 were as follows: For the Nine Months Ended September 30, 2022 2021 Expected life 7.5 (yrs) 7.5 (yrs) Expected volatility 35.40 % 40.33 % Risk-free interest rate 1.98 % 1.68 % Expected dividend yield 0.00 % 0.00 % The Company has granted restricted stock awards ("RSAs") to certain employees. Holders of RSAs have no voting rights and accrue dividends until vesting with payment being made once they vest. All of the shares currently vest one year from the grant date. Number of Weighted-Average Grant RSAs Date Fair Value Per RSA Outstanding as of December 31, 2021 36,033 $ 11.24 Granted 33,346 12.37 Vested ( 26,582 ) 11.24 Forfeited — — Outstanding as of September 30, 2022 42,797 $ 12.12 The Company has granted restricted stock units ("RSUs") to certain employees. Holders of RSUs have no voting rights and are not eligible to receive dividends or other distributions paid with respect to any RSUs that have not vested. All of the shares currently vest one year from the grant date. At the time of the Bonaccord acquisition, the Company entered into a Notice of Restricted Stock Units with certain employees of Bonaccord for grants of Restricted Stock Units ("Bonaccord Units") to be allocated to employees at a later date for meeting certain performance metrics. The Bonaccord Units may not be transferred, sold, pledged, exchanged, assigned or otherwise encumbered or disposed of by any grantee until it has become vested. On August 16, 2022, allocations were finalized and the Company and employees agreed to a value of $ 17.5 million worth of units that would vest at each future achievement of performance metrics. As of September 30, 2022, certain performance metrics have been met and 294,820 units have been allocated to specific employees. The Company deemed it probable that at least some of the remaining units would vest. Unvested units are remeasured quarterly against performance metrics as a liability on the Consolidated Balance Sheets and expense is recognized over the expected vesting period. An expense of $ 3.9 million has been recorded for the three and nine months ended September 30, 2022 on the Consolidated Statements of Operations. The unrecognized expense associated with the Bonaccord Units was $ 8.1 million as of September 30, 2022. At the time of the Hark acquisition, the Company entered into a Notice of Restricted Stock Units with an employee, which grants Restricted Stock Units ("Hark Units") for meeting a certain performance metric. The Hark Units may not be transferred, sold, pledged, exchanged, assigned or otherwise encumbered or disposed of by any grantee until they have become vested. As of September 30, 2022, no Hark Units have vested but the Company believes it is probable that the RSUs will be earned. An expense of $ 0.6 million has been recorded for the three and nine months ended September 30, 2022 on the Consolidated Statements of Operations. Unvested units are recognized ratably as a liability on the Consolidated Balance Sheets and expense is recognized over the expected vesting period. The unrecognized expense associated with the Hark Units was $ 0.9 million as of September 30, 2022. The below table does not include Bonaccord or Hark Units that were issued outside of the Plan, that have not vested and are recorded as a liability. Number of Weighted-Average Grant RSUs Date Fair Value Per RSU Outstanding as of December 31, 2021 59,654 $ 12.74 Granted 802,955 9.03 Vested ( 294,820 ) 11.12 Forfeited — — Outstanding as of September 30, 2022 567,789 $ 9.42 Compensation expense equal to the grant date fair value is recognized for these awards over the vesting period and is included in compensation and benefits on our Consolidated Statem ents of Operations. The stock-based compensation expense for the three and nine months ended September 30, 2022 was $ 7.3 million and $ 11.5 million a nd for the three and nine months ended September 30, 2021 was $ 0.5 million and $ 1.5 million, r espectively. Unrecognized stock-based compensation expense related to outstanding unvested stock options as of September 30, 2022 wa s $ 6.4 million a nd is expected to be recognized over a weighted average period of 2.6 years . Any future forfeitures will impact this amount. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 17. Earnings Per Share The Company presents basic EPS and diluted EPS for our common stock. Basic EPS excludes potential dilution and is computed by dividing net income by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if shares of common stock were issued pursuant to our stock-based compensation awards. Additionally, diluted EPS reflects the potential dilution that could occur if convertible preferred shares of P10 Intermediate were converted into common shares of P10 Intermediate. This is only applicable for the three and nine months ended September 30, 2021 as the preferred shares of P10 Intermediate converted to shares of Class B common stock effective with the IPO. The following table presents a reconciliation of the numerators and denominators used in the computation of basic and diluted EPS: For the Three Months For the Nine Months 2022 2021 2022 2021 Numerator: Numerator for earnings per share assuming $ 5,617 $ 2,515 $ 24,563 $ 5,661 Denominator: Denominator for basic calculation—Weighted- 117,210 62,465 117,210 62,465 Weighted shares assumed upon exercise of stock 4,322 4,323 4,152 4,238 Denominator for earnings per share assuming dilution 121,532 66,788 121,362 66,703 Earnings per share—basic $ 0.05 $ 0.04 $ 0.21 $ 0.09 Earnings per share—diluted $ 0.05 $ 0.04 $ 0.20 $ 0.08 The computations of diluted earnings per share excluded options to purcha se 1.0 million and 1.0 million s hares of common stock for the three and nine months ended September 30, 2022, respectively, a nd 0 and 2.9 million shares for the three and nine months ended September 30, 2021 , respectively, because the options were anti-dilutive. |
Redeemable Noncontrolling Inter
Redeemable Noncontrolling Interest | 9 Months Ended |
Sep. 30, 2022 | |
Noncontrolling Interest [Abstract] | |
Redeemable Noncontrolling Interest | Note 18. Redeemable Noncontrolling Interest In connection with the closing of the acquisition of Five Points on April 1, 2020, the Company formed a new subsidiary, P10 Intermediate, which was the acquiring entity of Five Points. On April 1, 2020, P10 Intermediate issued three series (A, B and C) of redeemable convertible preferred shares. On October 2, 2020 and December 14, 2020, P10 Intermediate issued two additional series (D and E) in connection with the acquisitions of TrueBridge and Enhanced. The preferred shares on an as-if-converted basis represented approximately 40.9 % of the aggregate issued and outstanding share capital of P10 Intermediate with P10 owning the remaining 59.1 % through its 100 % ownership of the outstanding common stock of P10 Intermediate. The third-party ownership interest represented a noncontrolling interest in P10 Intermediate, which the Company had a controlling interest in. Dividends on the preferred shares were recognized as preferred dividends attributable to redeemable non-controlling interest in our Consolidated Statements of Operations. In connection with the IPO on October 20, 2021, all preferred shares were contractually converted to Class B common shares. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 19. Subsequent Events On October 13, 2022, the Company completed the acquisition of all of the issued and outstanding membership interests of Westech Investment Advisors LLC ("WTI") for a purchase price consisting of $ 97.0 million in cash and earnout payments of up to an additional $ 70.0 million of cash and common stock and an aggregate of 3,916,666 membership units of P10 Intermediate which can be exchanged on a one-for-one basis into shares of P10 common stock, subject to certain conditions pursuant to the Exchange Agreement entered into on August 25, 2022. The Company is in the process of completing its accounting for the transaction. In connection with the acquisition of WTI, the Company granted 3,595,000 options under the 2021 Incentive Plan. The options vest over five years and expire ten years from the grant date. The Company drew on the accordion feature of the Credit Agreement in order to fund the cash portion of the purchase price of the WTI acquisition. The $ 125.0 million accordion was exercised as $ 87.5 million of term loan and $ 37.5 million of revolver. We drew $ 87.5 million of the term loan and $ 6.0 million of the revolver in cash to complete the WTI acquisition. The Board of Directors of the Company has declared a quarterly dividend of $ 0.03 per share of Class A and Class B common stock, payable on December 20, 2022, to the holders of record as of the close of business on November 30, 2022. In accordance with ASC 855, Subsequent Events, the Company evaluated all material events or transactions that occurred after September 30, 2022, the Consolidated Balance Sheet date, through the date the Consolidated Financial Statements were issued, and determined there have been no additional events or transactions that would materially impact the Consolidated Financial Statements. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying Consolidated Financial Statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Management believes it has made all necessary adjustments so that the Consolidated Financial Statements are presented fairly and that estimates made in preparing the Consolidated Financial Statements are reasonable and prudent. The Consolidated Financial Statements include the accounts of the Company, its wholly owned or majority-owned subsidiaries and entities in which the Company is deemed to have a direct or indirect controlling financial interest based on either a variable interest model or voting interest model. All intercompany transactions and balances have been eliminated upon consolidation. The results for the nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the full year ending December 31, 2022. Certain entities in which the Company holds an interest are investment companies that follow specialized accounting rules under U.S. GAAP and reflect their investments at estimated fair value. Accordingly, the carrying value of the Company’s equity method investments in such entities retains the specialized accounting treatment. |
Principles of Consolidation | Principles of Consolidation The Company performs the variable interest analysis for all entities in which it has a potential variable interest. If the Company has a variable interest in the entity and the entity is a variable interest entity (“VIE”), we will also analyze whether the Company is the primary beneficiary of this entity and if consolidation is required. Generally, VIEs are entities that lack sufficient equity to finance their activities without additional financial support from other parties, or whose equity holders, as a group, lack one or more of the following characteristics: (a) direct or indirect ability to make decisions, (b) obligation to absorb expected losses or (c) right to receive expected residual returns. A VIE must be evaluated quantitatively and qualitatively to determine the primary beneficiary, which is the reporting entity that has (a) the power to direct activities of a VIE that most significantly impact the VIE's economic performance and (b) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. To determine a VIE's primary beneficiary, we perform a qualitative assessment to determine which party, if any, has the power to direct activities of the VIE and the obligation to absorb losses and/or receive its benefits. This assessment involves identifying the activities that most significantly impact the VIE's economic performance and determine whether we, or another party, has the power to direct those activities. When evaluating whether we are the primary beneficiary of a VIE, we perform a qualitative analysis that considers the design of the VIE, the nature of our involvement and the variable interests held by other parties. See Note 7 for further information. The Company has determined that certain of its subsidiaries are VIEs, and that the Company is the primary beneficiary of the entities, because it has the power to direct activities of the entities that most significantly impact the VIE’s economic performance and has a controlling financial interest in each entity. Accordingly, the Company consolidates these entities, which includes Holdco, RCP 2, RCP 3, TrueBridge, Bonaccord, and Hark. The assets and liabilities of the consolidated VIEs are presented on a gross basis in the Consolidated Balance Sheets. As a result of the reorganization, it was determined that P10 Intermediate no longer qualifies as a VIE, but would still be consolidated under the voting interest model. This change has been retrospectively adjusted. See Note 7 for more information on both consolidated and unconsolidated VIEs. Entities that do not qualify as VIEs are assessed for consolidation under the voting interest model. Under the voting interest model, the Company consolidates those entities it controls through a majority voting interest or other means. P10 Holdings, P10 Intermediate, Five Points, P10 Advisors and ECG are concluded to be consolidated subsidiaries of P10 under the voting interest model. |
Reclassification | Reclassifications Certain reclassifications have been made within the Consolidated Financial Statements to conform prior periods with current period presentation. |
Use of Estimates | Use of Estimates The preparation of the Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the dates of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid instruments with original maturities of three months or less to be cash equivalents. As of September 30, 2022, and December 31, 2021, cash equivalents include money market funds of $ 2.1 million and $ 10.7 million, respectively, which approximates fair value. The Company maintains its cash balances at various financial institutions, which may periodically exceed the Federal Deposit Insurance Corporation (“FDIC”) insured limits. The Company believes it is not exposed to any significant credit risk on cash. |
Restricted Cash | Restricted Cash Restricted cash as of September 30, 2022 and December 31, 2021 was primarily cash that is restricted due to certain deposits being held by the Company for its customers. |
Accounts Receivable and Due from Related Parties | Accounts Receivable and Due from Related Parties Accounts receivable is equal to contractual amounts reduced for allowances, if applicable. The Company considers accounts receivable to be fully collectible; accordingly, no allowance for doubtful accounts has been established as of September 30, 2022 and December 31, 2021. If accounts are subsequently determined to be uncollectible, they will be expensed in the period that determination is made. Due from related parties represents receivables from the Funds for reimbursable expenses. Additionally, fees owed to the Company for the advisory agreement entered into upon the closing of the acquisitions of ECG and ECP ("Advisory Agreement") where ECG provides advisory services to Enhanced Permanent Capital, LLC ("Enhanced PC") are reflected in due from related parties on the Consolidated Balance Sheets. These amounts are expected to be fully collectible. |
Notes Receivable | Note Receivable Note receivable is mostly related to contractual amounts owed from a signed, secured promissory note with BCP Partners Holdings, LP ("BCP"). In addition to contractual amounts, borrowers are obligated to pay interest on outstanding amounts. The Company considers the note receivable to be fully collectible; accordingly, no allowance for doubtful accounts has been established as of September 30, 2022 or December 31, 2021 . If accounts are subsequently determined to be uncollectible, they will be expensed in the period that determination is made. |
Investment in Unconsolidated Subsidiaries | Investment in Unconsolidated Subsidiaries For equity investments in entities that we do not control, but over which we exercise significant influence, we use the equity method of accounting. The equity method investments are initially recorded at cost, and their carrying amount is adjusted for the Company’s share in the earnings or losses of each investee, and for distributions received. The Company evaluates its equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may not be recoverable. For certain entities in which the Company does not have significant influence and fair value is not readily determinable, we value these investments under the measurement alternative. Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 825 , Financial Instruments, requires equity securities to be recorded at cost and adjusted to fair value at each reporting period. However, the guidance allows for a measurement alternative, which is to record the investments at cost, less impairment, if any, and subsequently adjust for observable price changes of identical or similar investments of the same issuer. |
Property and Equipment | Property and Equipment Property and equipment are recorded at cost, less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets. Leasehold improvements are amortized over the terms of the respective leases or service lives of the improvements, whichever is shorter, using the straight-line method. Expenditures for major renewals and betterments that extend the useful lives of the property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred. The estimated useful lives of the various assets are as follows: Computers and purchased software 3 - 5 years Furniture and fixtures 7 - 10 years |
Long-lived Assets | Long-lived Assets Long-lived assets including property and equipment, lease right-of-use assets, and definite lived intangibles are evaluated for impairment under FASB ASC 360, Property, Plant, and Equipment . Long-lived assets are reviewed for possible impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The carrying value of long-lived assets are determined to not be recoverable if the undiscounted estimated future net operating cash flows directly related to the asset or asset group, including any disposal value, is less than the carrying amount of the asset. If the carrying value of an asset is determined to not be recoverable, the impairment loss is measured as the amount by which the carrying value of the asset exceeds its fair value on the measurement date. Fair value is based on the best information available, including prices for similar assets and estimated discounted cash flows. |
Leases | Leases The Company recognizes a lease liability and right-of-use asset in our Consolidated Balance Sheets for contracts that it determines are leases or contain a lease. The Company’s leases primarily consist of operating leases for various office spaces. Right-of-use assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the leases. The Company’s right-of-use assets and lease liabilities are recognized at lease commencement based on the present value of lease payments over the lease term. Lease right-of-use assets include initial direct costs incurred by the Company and are presented net of deferred rent, lease incentives and certain other existing lease liabilities. Absent an implicit interest rate in the lease, the Company uses its incremental borrowing rate, adjusted for the effects of collateralization, based on the information available at commencement in determining the present value of lease payments. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise those options. Lease expense is recognized on a straight-line basis over the lease term. Additionally, upon amendments or other events, the Company may be required to remeasure our lease liability and right-of-use asset. The Company does not recognize a lease liability or right-of-use asset on our Consolidated Balance Sheets for short-term leases. Instead, the Company recognizes short-term lease payments as an expense on a straight-line basis over the lease term. A short-term lease is defined as a lease that, at the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise. When determining whether a lease qualifies as a short-term lease, the Company evaluates the lease term and the purchase option in the same manner as all other leases. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill is initially measured as the excess of the cost of the acquired business over the sum of the amounts assigned to identifiable assets acquired, less the liabilities assumed. As of September 30, 2022, goodwill recorded on our Consolidated Balance Sheets relates to the acquisitions of RCP 2, RCP 3, Five Points, TrueBridge, Enhanced, Bonaccord, and Hark. As of September 30, 2022, the intangible assets are comprised of indefinite-lived intangible assets and finite-lived intangible assets related to the acquisitions of RCP 2, RCP 3, Five Points, TrueBridge, Enhanced, Bonaccord and Hark. Indefinite-lived intangible assets and goodwill are not amortized. Finite-lived technology is amortized using the straight-line method over its estimated useful life of 4 years . Finite-lived management and advisory contracts, which relate to acquired separate accounts and funds and investor/customer relationships with a specified termination date, are amortized in line with contractual revenue to be received, which range between 7 and 16 years . Certain of our trade names are considered to have finite-lives. Finite-lived trade names are amortized over 10 years in line with the pattern in which the economic benefits are expected to occur. Goodwill is reviewed for impairment at least annually as of September 30 utilizing a qualitative or quantitative approach and more frequently if circumstances indicate impairment may have occurred. The impairment testing for goodwill under the qualitative approach is based first on a qualitative assessment to determine if it is more likely than not that the fair value of the Company’s reporting unit is less than the respective carrying value. The reporting unit is the reporting level for testing the impairment of goodwill. If it is determined that it is more likely than not that a reporting unit’s fair value is less than its carrying value, then the difference is recorded as an impairment (not to exceed the carrying amount of goodwill). |
Debt Issuance Costs | Debt Issuance Costs Costs incurred which are directly related to the issuance of debt are deferred and amortized using the effective interest method and are presented as a reduction to the carrying value of the associated debt on our Consolidated Balance Sheets. As these costs are amortized, they are included in interest expense, net within our Consolidated Statements of Operations. |
Treasury Stock | Treasury Stock The Company records common stock purchased for treasury at cost. At the date of subsequent reissuance, the treasury stock account is reduced by the cost of such stock using the average cost method. |
Fair Value Measurement | Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between independent and knowledgeable parties who are willing and able to transact for an asset or liability at the measurement date. We use valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs when determining fair value and then we rank the estimated values based on the reliability of the inputs used following the fair value hierarchy set forth by the FASB. As of September 30, 2022 and December 31, 2021, we used the following valuation techniques to measure fair value for assets and there were no changes to these methodologies during the periods presented: Level 1—Assets were valued using the closing price reported in the active market in which the individual security was traded. Level 2—Assets were valued using quoted prices in markets that are not active, broker dealer quotations, and other methods by which all significant inputs were observable at the measurement date. Level 3—Assets were valued using unobservable inputs in which little or no market data exists as reported by the respective institutions at the measurement date. The carrying values of financial instruments comprising cash and cash equivalents, prepaid assets, accounts payable, accounts receivable and due from related parties approximate fair values due to the short-term maturities of these instruments. The fair value of the credit and guarantee facility approximates the carrying value based on the interest rates which approximate current market rates. The Company has a contingent consideration liability related to the acquisitions of Hark and Bonaccord that is measured at fair value and is remeasured on a recurring basis. See Note 11 for additional information. |
Revenue Recognition | Revenue Recognition Revenue is recognized when, or as, the Company transfers promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled to in exchange for those goods or services. While the determination of who is the customer in a contractual arrangement will be made on a contract-by-contract basis, the customer will generally be the investment fund for the Company’s significant management and advisory contracts. Management and Advisory Fees The Company earns management fees for asset management services provided to the Funds where the Company has discretion over investment decisions. The Company primarily earns fees for advisory services provided to clients where the Company does not have discretion over investment decisions. Management and advisory fees received in advance reflects the amount of fees that have been received prior to the period the fees are earned. These fees are recorded as deferred revenue on the Consolidated Balance Sheets. For asset management and advisory services, the Company typically satisfies its performance obligations over time as the services are rendered, since the customers simultaneously receive and consume the benefits provided as the Company performs the service. The transaction price is the amount of consideration to which the Company expects to be entitled based on the terms of the arrangement. For certain funds, management fees are initially calculated based on committed capital during the investment period and on net invested capital through the remainder of the fund’s term. Additionally, the management fee may step down for certain funds depending on the contractual arrangement. Advisory services are generally based upon fixed amounts and billed quarterly. Other advisory services include transaction and management fees associated with managing the origination and ongoing compliance of certain investments. Other Revenue Other revenue on our Consolidated Statements of Operations primarily consists of subscriptions, consulting agreements and referral fees. The subscription and consulting agreements typically have renewable one-year lives, and revenue is recognized ratably over the current term of the subscription or the agreement. If subscriptions or fees have been paid in advance, these fees are recorded as deferred revenue on our Consolidated Balance Sheets. Referral fee revenue is recognized upon closing of certain opportunities. |
Income Tax | Income Taxes Current income tax expense represents our estimated taxes to be paid or refunded for the current period. In accordance with ASC 740, Income Taxes (“ASC 740”), we recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax basis of assets and liabilities, as well as for operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which the differences are expected to reverse. Valuation allowances are recorded to reduce deferred tax assets to the amount we believe is more likely than not to be realized. Uncertain tax positions are recognized only when we believe it is more likely than not that the tax position will be upheld on examination by the taxing authorities based on the merits of the position. We recognize interest and penalties, if any, related to uncertain tax positions in income tax expense. We file various federal and state and local tax returns based on federal and state local consolidation and stand-alone tax rules as applicable. |
Earnings Per Share | Earnings Per Share Basic earnings per share (“EPS”) is calculated by dividing net income attributable to common stockholders by the weighted-average number of common shares. Diluted EPS includes the determinants of basic EPS and common stock equivalents outstanding during the period adjusted to give effect to potentially dilutive securities. See Note 17 for additional information. Prior to the IPO, redeemable noncontrolling interests represented third party and related party interests in the Company's consolidated subsidiary, P10 Intermediate. Prior to the conversion of the redeemable convertible preferred shares issued by P10 Intermediate to class B shares, the numerator in the computation of diluted EPS was impacted by the redeemable convertible preferred shares. Under the if converted method, diluted EPS reflects a reduction in earnings that P10 would recognize by owning a smaller percentage of P10 Intermediate when the preferred shares are assumed to be converted. The denominator in the computation of diluted EPS is impacted by additional common shares that would have been outstanding if dilutive potential shares of common stock had been issued. Potential shares of common stock that may be issued by the Company include shares of common stock that may be issued upon exercise of outstanding stock options. Under the treasury stock method, the unexercised options are assumed to be exercised at the beginning of the period or at issuance, if later. The assumed proceeds are then used to purchase shares of common stock at the average market price during the period. |
Stock-Based Compensation Expense | Stock-Based Compensation Expense Stock-based compensation relates to grants for shares of P10 awarded to our employees through stock options as well as RSUs awarded to employees and RSAs issued to non-employee directors as compensation for service on the Company's board. RSUs and RSAs stock compensation expense are recorded ratably over the vesting period at the fair market value on the grant date. Stock option compensation cost is estimated at the grant date based on the fair-value of the award, which is determined using the Black Scholes option valuation model and is recognized as an expense ratably over the requisite service period of the award, generally five years . The share price used in the Black Scholes model is based on the trading price of our shares on the public markets. Expected life is based on the vesting period and expiration date of the option. Stock price volatility is estimated based on a group of similar publicly traded companies determined to be most reflective of the expected volatility of the Company due to the nature of operations of these entities. The risk-free rates are based on the U.S. Treasury yield in effect at the time of grant. Forfeitures are recognized as they occur. |
Segment Reporting | Segment Reporting The Company operates as an integrated private markets solution provider and a single operating segment. According to ASC 280, Disclosures about Segments of an Enterprise and Related Information , operating segments are defined as components of an enterprise for which separate financial information is evaluated regularly by the chief operating decision maker(s) in deciding how to allocate resources and in assessing performance. |
Contingent Consideration and Business Acquisitions | Contingent Consideration Contingent consideration is initially measured at fair value on the date of the acquisition. The liabilities are remeasured at fair value on each reporting date, with changes in the fair value reflected in operating expenses on our Consolidated Statements of Operations. As of September 30, 2022 and December 31, 2021, contingent consideration recorded relates to the acquisitions of Hark and Bonaccord on the Consolidated Balance Sheets. Business Acquisitions In accordance with ASC 805, Business Combinations (“ASC 805”), the Company identifies a business to have three key elements; inputs, processes, and outputs. While an integrated set of assets and activities that is a business usually has outputs, outputs are not required to be present. In addition, all the inputs and processes that a seller uses in operating a set of assets and activities are not required if market participants can acquire the set of assets and activities and continue to produce outputs. In addition, the Company also performs a screen test to determine when a set of assets and activities is not a business. The screen requires that when substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets, the set of assets is not a business. If the set of assets and activities is not considered a business, it is accounted for as an asset acquisition using a cost accumulation model. In the cost accumulation model, the cost of the acquisition, including certain transaction costs, is allocated to the assets acquired on the basis of relative fair values. The Company includes the results of operations of acquired businesses beginning on the respective acquisition dates. In accordance with ASC 805, the Company allocates the purchase price of an acquired business to its identifiable assets and liabilities based on the estimated fair values using the acquisition method. The excess of the purchase price over the amount allocated to the assets and liabilities, if any, is recorded as goodwill. The excess value of the net identifiable assets and liabilities acquired over the purchase price of an acquired business is recorded as a bargain purchase gain. The Company uses all available information to estimate fair values of identifiable intangible assets and property acquired. In making these determinations, the Company may engage an independent third-party valuation specialist to assist with the valuation of certain intangible assets, notes payable, and tax amortization benefits. The consideration for certain of our acquisitions may include liability classified contingent consideration, which is determined based on formulas stated in the applicable purchase agreements. The amount to be paid under these arrangements is based on certain financial performance measures subsequent to the acquisitions. The contingent consideration included in the purchase price is measured at fair value on the date of the acquisition. The liabilities are remeasured at fair value on each reporting date, with changes in the fair value reflected in general, administrative and other on our Consolidated Statements of Operations. For business acquisitions, the Company recognizes the fair value of goodwill and other acquired intangible assets, and estimated contingent consideration at the acquisition date as part of purchase price. This fair value measurement is based on unobservable (Level 3) inputs. |
Dividends | Dividends Dividends are reflected in the consolidated financial statements when declared. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements The Company adopted ASU No. 2019-12, Income Taxes ("Topic 740") : Disclosure Framework - Simplifying the Accounting for Income Taxes , on January 1, 2021, which simplified the accounting for income taxes by removing certain exceptions to the general principles of Topic 740 and clarifying and amending existing guidance. The adoption of this standard did not have a material impact on our financial statements. Pronouncements Not Yet Adopted In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 provides amendments to ASC 326, Financial Instruments - Credit Losses , which replaces the incurred loss impairment model with a current expected credit loss (“CECL”) model. CECL requires a company to estimate lifetime expected credit losses based on relevant information about historical events, current conditions and reasonable and supportable forecasts. The guidance must be applied using the modified retrospective adoption method on January 1, 2023, with early adoption permitted. We are evaluating the effects of these amendments on our financial reporting. On October 28, 2021, the FASB issued ASU 2021-08, which amends ASC 805 to “require acquiring entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination.” Under current GAAP, an acquirer generally recognizes such items at fair value on the acquisition date. The guidance is effective for fiscal years beginning after December 15, 2022. We are evaluating the effects of these amendments on our financial reporting. On June 30, 2022, the FASB issued ASU No. 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions ("ASU 2022-03"). The amendments in this Update affect all entities that have investments in equity securities measured at fair value that are subject to a contractual sale restriction. The amendments clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The amen d ments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The guidance is effective for fiscal years beginning after December 15, 2023. We are evaluating the effects of these amendments on our financial reporting. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Schedule of Estimated Useful Lives of Various Assets | The estimated useful lives of the various assets are as follows: Computers and purchased software 3 - 5 years Furniture and fixtures 7 - 10 years |
Acquisitions (Tables)
Acquisitions (Tables) - Bonaccord | 9 Months Ended |
Sep. 30, 2022 | |
Business Acquisition [Line Items] | |
Summary of the Consideration Paid | The following is a summary of consideration paid: Fair Value Cash $ 38,927 Contingent consideration 17,435 Total purchase consideration $ 56,362 |
Summary of Fair Value of the Net Assets Acquired as of the Acquisition Date | The following table presents the fair value of the net assets acquired as of the acquisition date: Fair Value ASSETS Prepaid expenses and other assets 9 Investment in partnership 1,396 Intangible assets 12,940 Total assets acquired $ 14,345 LIABILITIES Accrued expenses $ 919 Total liabilities assumed $ 919 Net identifiable assets acquired $ 13,426 Goodwill 42,936 Net assets acquired $ 56,362 |
Summary of the Fair Value of Identifiable Intangible Assets Acquired | The following table presents the fair value of the identifiable intangible assets acquired: Weighted- Average Amortization Fair Value Period Value of management and advisory contracts $ 9,450 8 Value of trade name 3,490 10 Total identifiable intangible assets $ 12,940 |
Summary of Unaudited Pro Forma Condensed Consolidated Results of Operations Attributable to the Acquisitions | The following unaudited pro forma condensed consolidated results of operations of the Company assumes the acquisition of Bonaccord was completed on January 1, 2021: For the Nine Months 2022 2021 Revenue $ 140,015 $ 120,057 Net income attributable to P10 24,563 12,749 |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue by Product Offering | The following presents revenues disaggregated by product offering: For the Three Months For the Nine Months 2022 2021 2022 2021 Management and advisory fees $ 49,479 $ 37,939 $ 138,957 $ 104,029 Subscriptions 165 153 493 486 Other revenue 352 53 565 386 Total revenues $ 49,996 $ 38,145 $ 140,015 $ 104,901 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment | Property and equipment consist of the following: As of September 30, As of December 31, 2022 2021 Computers and purchased software $ 580 $ 387 Furniture and fixtures 885 461 Leasehold improvements 1,632 601 Other 3 3 $ 3,100 $ 1,452 Less: accumulated depreciation ( 587 ) ( 471 ) Total property and equipment, net $ 2,513 $ 981 |
Goodwill and Intangibles (Table
Goodwill and Intangibles (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Changes in goodwill for the nine months ended September 30, 2022 is as follows: Balance at December 31, 2021 $ 418,701 Purchase price adjustment ( 11 ) Increase from acquisitions - Balance at September 30, 2022 $ 418,690 |
Schedule of Intangible Assets | Intangibles consists of the following: As of September 30, 2022 Gross Carrying Accumulated Net Carrying Indefinite-lived intangible assets: Trade names $ 17,350 $ — $ 17,350 Technology 30 — 30 Total indefinite-lived intangible assets 17,380 — 17,380 Finite-lived intangible assets: Trade names 21,440 ( 2,991 ) 18,449 Management and advisory contracts 151,166 ( 77,802 ) 73,364 Technology 2,359 ( 1,103 ) 1,256 Total finite-lived intangible assets 174,965 ( 81,896 ) 93,069 Total intangible assets $ 192,345 $ ( 81,896 ) $ 110,449 As of December 31, 2021 Gross Carrying Accumulated Net Carrying Indefinite-lived intangible assets: Trade names $ 17,350 $ — $ 17,350 Technology 30 — 30 Total indefinite-lived intangible assets 17,380 — 17,380 Finite-lived intangible assets: Trade names 21,440 ( 1,785 ) 19,655 Management and advisory contracts 151,166 ( 60,934 ) 90,232 Technology 8,160 ( 6,639 ) 1,521 Total finite-lived intangible assets 180,766 ( 69,358 ) 111,408 Total intangible assets $ 198,146 $ ( 69,358 ) $ 128,788 |
Estimated Future Amortization Expense | The amortization expense for each of the next five years and thereafter are as follows: Remainder of 2022 $ 6,160 2023 21,155 2024 17,590 2025 13,807 2026 10,878 Thereafter 23,479 Total amortization $ 93,069 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Liabilities | The following tables provide details regarding the classification of these liabilities within the fair value hierarchy as of the dates presented: As of September 30, 2022 Level I Level II Level III Total Liabilities Contingent consideration obligation $ - $ - $ 24,330 $ 24,330 Total liabilities $ - $ - $ 24,330 $ 24,330 As of December 31, 2021 Level I Level II Level III Total Liabilities Contingent consideration obligation $ - $ - $ 22,963 $ 22,963 Total liabilities $ - $ - $ 22,963 $ 22,963 |
Schedule of Changes in the Fair Value of Level III Financial Instruments | The changes in the fair value of Level III financial instruments are set forth below: Contingent Consideration Liability For the Nine Months Ended September 30, For the Nine Months Ended September 30, 2022 2021 Balance, beginning of year: $ 22,963 $ 593 Additions - 19,160 Change in fair value 1,367 134 Settlements - ( 727 ) Balance, end of period: $ 24,330 $ 19,160 |
Debt Obligations (Tables)
Debt Obligations (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Debt Obligations | Debt obligations consists of the following: As of As of September 30, December 31, 2022 2021 Gross revolving credit facility state tax credits $ — $ - Debt issuance costs — ( 8 ) Revolving credit facility state tax credits, net $ — $ ( 8 ) Revolver facility $ 49,900 $ 90,900 Debt issuance costs ( 2,833 ) ( 2,981 ) Revolver facility, net $ 47,067 $ 87,919 Term Loan $ 125,000 $ 125,000 Debt issuance costs ( 1,293 ) ( 415 ) Term loan, net $ 123,707 $ 124,585 Total debt obligations $ 170,774 $ 212,496 |
Summary of Terms of Debt Obligations | The table below summarizes the terms of the debt obligations. September 30, 2022 Weighted Maturity Date Aggregate Facility Size Outstanding Debt Amount Available Net Carrying Value Average Interest Rate Term Loan 12/22/2025 $ 125,000 $ 125,000 $ — $ 123,707 2.35 % Revolver Facility 12/22/2025 125,000 49,900 75,100 47,067 3.03 % Total $ 250,000 $ 174,900 $ 75,100 $ 170,774 |
Schedule of Maturities of Long-term Debt | Future principal maturities of debt as of September 30, 2022 are as follows: 2022 $ — 2023 6,250 2024 6,250 2025 162,400 $ 174,900 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Company's Operating Leases | The following table presents information regarding the Company’s operating leases as of September 30, 2022: Operating lease right-of-use assets $ 13,052 Operating lease liabilities $ 15,425 Cash paid for lease liabilities $ 1,690 Weighted-average remaining lease term (in years) 7.47 Weighted-average discount rate 4.47 % |
Schedule of Future Contractual Lease Payments | The future contractual lease payments as of September 30, 2022 are as follows: Remainder of 2022 $ 538 2023 2,976 2024 3,222 2025 2,066 2026 1,727 Thereafter 8,977 Total undiscounted lease payments 19,506 Less discount ( 3,121 ) Less construction allowance ( 960 ) Total lease liabilities $ 15,425 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Summary of Stock Option Activity | A summary of stock option activity for the nine months ended September 30, 2022 is as follows: Weighted Average Contractual Life Aggregate Number of Weighted Average Remaining Intrinsic Value Shares Exercise Price (in years) (whole dollars) Outstanding as of December 31, 2021 7,095,936 $ 3.71 7.45 $ 73,156,722 Granted 1,323,733 12.28 Exercised ( 41,570 ) 4.80 Settled ( 1,120,000 ) 0.41 Expired/Forfeited ( 29,985 ) 10.04 Outstanding as of September 30, 2022 7,228,114 $ 5.75 7.51 $ 37,496,331 Exercisable as of September 30, 2022 320,440 $ 3.83 6.04 $ 2,144,803 |
Summary of Weighted Average Assumptions Used In Calculating Fair Value of Stock Options Granted | The weighted average assumptions used in calculating the fair value of stock options granted during the nine months ended September 30, 2022 and September 30, 2021 were as follows: For the Nine Months Ended September 30, 2022 2021 Expected life 7.5 (yrs) 7.5 (yrs) Expected volatility 35.40 % 40.33 % Risk-free interest rate 1.98 % 1.68 % Expected dividend yield 0.00 % 0.00 % |
Summary of Restricted Stock Activity | The Company has granted restricted stock awards ("RSAs") to certain employees. Holders of RSAs have no voting rights and accrue dividends until vesting with payment being made once they vest. All of the shares currently vest one year from the grant date. Number of Weighted-Average Grant RSAs Date Fair Value Per RSA Outstanding as of December 31, 2021 36,033 $ 11.24 Granted 33,346 12.37 Vested ( 26,582 ) 11.24 Forfeited — — Outstanding as of September 30, 2022 42,797 $ 12.12 |
Summary of Restricted Stock Units | The Company has granted restricted stock units ("RSUs") to certain employees. Holders of RSUs have no voting rights and are not eligible to receive dividends or other distributions paid with respect to any RSUs that have not vested. All of the shares currently vest one year from the grant date. Number of Weighted-Average Grant RSUs Date Fair Value Per RSU Outstanding as of December 31, 2021 59,654 $ 12.74 Granted 802,955 9.03 Vested ( 294,820 ) 11.12 Forfeited — — Outstanding as of September 30, 2022 567,789 $ 9.42 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted EPS | The following table presents a reconciliation of the numerators and denominators used in the computation of basic and diluted EPS: For the Three Months For the Nine Months 2022 2021 2022 2021 Numerator: Numerator for earnings per share assuming $ 5,617 $ 2,515 $ 24,563 $ 5,661 Denominator: Denominator for basic calculation—Weighted- 117,210 62,465 117,210 62,465 Weighted shares assumed upon exercise of stock 4,322 4,323 4,152 4,238 Denominator for earnings per share assuming dilution 121,532 66,788 121,362 66,703 Earnings per share—basic $ 0.05 $ 0.04 $ 0.21 $ 0.09 Earnings per share—diluted $ 0.05 $ 0.04 $ 0.20 $ 0.08 |
Description of Business - Addit
Description of Business - Additional Information (Details) | Oct. 20, 2021 |
Conversion of Stock [Line Items] | |
Reverse stock split | 0.7-for-1 |
Stock split, conversion ratio | 0.7 |
Significant Accounting Polici_4
Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Allowance for doubtful accounts | $ 0 | $ 0 |
Stock-based compensation award, requisite service period | 5 years | |
Finite-Lived Management and Advisory Contracts | Minimum | ||
Finite-lived intangible assets, useful life | 7 years | |
Finite-Lived Management and Advisory Contracts | Maximum | ||
Finite-lived intangible assets, useful life | 16 years | |
Finite-Lived Technology | ||
Finite-lived intangible assets, useful life | 4 years | |
Trade names | ||
Finite-lived intangible assets, useful life | 10 years | |
Money Market Funds | ||
Cash Equivalents | $ 2,100 | $ 10,700 |
Significant Accounting Polici_5
Significant Accounting Policies - Schedule of Estimated Useful Lives of Various Assets (Details) | 9 Months Ended |
Sep. 30, 2022 | |
Computers and Purchased Software | Maximum | |
Property, Plant and Equipment, Estimated Useful Life | 5 years |
Computers and Purchased Software | Minimum | |
Property, Plant and Equipment, Estimated Useful Life | 3 years |
Furniture and Fixtures | Maximum | |
Property, Plant and Equipment, Estimated Useful Life | 10 years |
Furniture and Fixtures | Minimum | |
Property, Plant and Equipment, Estimated Useful Life | 7 years |
Acquisitions - Summary of the C
Acquisitions - Summary of the Consideration Paid (Details) - Bonaccord $ in Thousands | Sep. 30, 2021 USD ($) |
Business Acquisition [Line Items] | |
Cash | $ 38,927 |
Contingent consideration | 17,435 |
Total purchase consideration | $ 56,362 |
Acquisitions - Summary of Fair
Acquisitions - Summary of Fair Value of the Net Assets Acquired as of the Acquisition Date (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 |
LIABILITIES | |||
Goodwill | $ 418,690 | $ 418,701 | |
Bonaccord | |||
ASSETS | |||
Prepaid expenses and other assets | $ 9 | ||
Investment in partnership | 1,396 | ||
Intangible assets | 12,940 | ||
Total assets acquired | 14,345 | ||
LIABILITIES | |||
Accrued expenses | 919 | ||
Total liabilities assumed | 919 | ||
Net identifiable assets acquired | 13,426 | ||
Goodwill | 42,936 | ||
Net assets acquired | $ 56,362 |
Acquisitions - Summary of the F
Acquisitions - Summary of the Fair Value of Identifiable Intangible Assets Acquired (Details) - Bonaccord $ in Thousands | Sep. 30, 2021 USD ($) |
Business Acquisition [Line Items] | |
Fair value of identifiable intangible assets | $ 12,940 |
Management and Advisory Contracts | |
Business Acquisition [Line Items] | |
Fair value of identifiable intangible assets | $ 9,450 |
Weighted-Average Amortization Period | 8 years |
Trade names | |
Business Acquisition [Line Items] | |
Fair value of identifiable intangible assets | $ 3,490 |
Weighted-Average Amortization Period | 10 years |
Acquisitions - Summary of Pro F
Acquisitions - Summary of Pro Forma Condensed Consolidated Results of Operations Attributable to Acquisitions (Details) - Bonaccord - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Business Acquisition [Line Items] | ||
Revenue | $ 140,015 | $ 120,057 |
Net income attributable to P10 | $ 24,563 | $ 12,749 |
Acquisitions - Additional Infor
Acquisitions - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Business Acquisition [Line Items] | ||||||
Stock-based compensation expense | $ 7,300 | $ 500 | $ 11,500 | $ 1,500 | ||
Goodwill | 418,690 | $ 418,690 | $ 418,701 | |||
Restricted Stock Units (RSUs) [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Vested | 294,820 | |||||
Bonaccord | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition effective date | Sep. 30, 2021 | |||||
Expenses related to business acquisition | $ 700 | 700 | 700 | |||
Purchase consideration | 56,362 | |||||
Contingent consideration | 17,435 | |||||
Amount of term loan credit facility | 35,000 | 35,000 | 35,000 | |||
Contingent consideration obligation | $ 19,300 | $ 19,300 | ||||
Payments to acquire business | 38,927 | |||||
Goodwill | 42,936 | 42,936 | 42,936 | |||
Business acquisition, goodwill, expected tax deductible amount | 42,900 | 42,900 | 42,900 | |||
Net identifiable assets acquired | $ 13,426 | $ 13,426 | $ 13,426 | |||
Bonaccord | Third Party [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Percentage of net management fee earnings rights | 15% | 15% | 15% | 15% | 15% | |
Bonaccord | Maximum | ||||||
Business Acquisition [Line Items] | ||||||
Contingent consideration | $ 20,000 | |||||
Bonaccord | Professional Fees | ||||||
Business Acquisition [Line Items] | ||||||
Expenses related to business acquisition | $ 300 | $ 200 | $ 300 | $ 200 | $ 300 | |
Hark | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition effective date | Sep. 30, 2021 | |||||
Purchase consideration | $ 7,200 | |||||
Contingent consideration obligation | 2,200 | 2,200 | 2,200 | |||
Payments to acquire business | 5,000 | |||||
Goodwill | 4,700 | 4,700 | 4,700 | |||
Net identifiable assets acquired | 2,500 | 2,500 | 2,500 | |||
Hark | Maximum | ||||||
Business Acquisition [Line Items] | ||||||
Contingent consideration obligation | $ 5,400 | $ 5,400 | $ 5,400 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue By Product (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 49,996 | $ 38,145 | $ 140,015 | $ 104,901 |
Management and Advisory Fees | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 49,479 | 37,939 | 138,957 | 104,029 |
Subscriptions | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | 165 | 153 | 493 | 486 |
Other Revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues | $ 352 | $ 53 | $ 565 | $ 386 |
Strategic Alliance Expense - Ad
Strategic Alliance Expense - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Business Combination, Separately Recognized Transactions [Line Items] | ||||
Strategic alliance expense | $ 124 | $ 0 | $ 429 | $ 0 |
Third Party [Member] | Bonaccord | ||||
Business Combination, Separately Recognized Transactions [Line Items] | ||||
Percentage of net management fee earnings rights | 15% | 15% | 15% | 15% |
Bonaccord Fund II [Member] | ||||
Business Combination, Separately Recognized Transactions [Line Items] | ||||
Percentage of additional net management fee earnings rights | 5% | 5% | ||
Percentage of Equity Rights Available to Acquire Equity Interest In Acquiree Percentage | 5% | 5% | ||
Bonaccord Fund III [Member] | ||||
Business Combination, Separately Recognized Transactions [Line Items] | ||||
Investment Company, Committed Capital | $ 5,000 | |||
Percentage of Equity Rights Available to Acquire Equity Interest In Acquiree Percentage | 4.90% | 4.90% | ||
Minimum | Bonaccord Fund II [Member] | ||||
Business Combination, Separately Recognized Transactions [Line Items] | ||||
Investment Company, Committed Capital | $ 5,000 | |||
Maximum | Bonaccord Fund II [Member] | ||||
Business Combination, Separately Recognized Transactions [Line Items] | ||||
Investment Company, Committed Capital | $ 250,000 |
Note Receivable - Additional In
Note Receivable - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Due from related parties | $ 30,359 | $ 30,359 | $ 12,357 | ||
Interest paid | 0 | ||||
Note receivable | 4,001 | 4,001 | 2,552 | ||
BCP Partners Holdings, LP | Promissory Note | |||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||||
Note to partners | 5,000 | $ 5,000 | |||
Notes, interest rate description | The note will earn interest at the greater of (i) the applicable federal rate that must be charged to avoid imputation of interest under Section 1274(d) of the U.S. Internal Revenue Code and (ii) 5.5%. Interest will be paid on December 31st of each year commencing December 31, 2021, with any unpaid accrued interest being capitalized and added to the outstanding principal balance. | ||||
Due from related parties | 4,000 | $ 4,000 | $ 2,600 | ||
Maturity Date | Sep. 30, 2031 | ||||
Interest rate of notes | 5.50% | ||||
Interest revenue | $ 100 | $ 0 | $ 100 | $ 0 |
Property and Equipment - Summar
Property and Equipment - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 3,100 | $ 1,452 |
Less: accumulated depreciation | (587) | (471) |
Total property and equipment, net | 2,513 | 981 |
Computers and Purchased Software | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 580 | 387 |
Furniture and Fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 885 | 461 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | 1,632 | 601 |
Other | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Gross | $ 3 | $ 3 |
Goodwill and Intangibles - Sche
Goodwill and Intangibles - Schedule of Goodwill (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill, Beginning Balance | $ 418,701 |
Purchase price adjustment | (11) |
Increase from acquisitions | 0 |
Goodwill, Ending Balance | $ 418,690 |
Goodwill and Intangibles - Sc_2
Goodwill and Intangibles - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Indefinite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | $ 17,380 | $ 17,380 |
Finite-lived intangible assets, gross carrying amount | 174,965 | 180,766 |
Intangible assets, accumulated amortization | (81,896) | (69,358) |
Total amortization | 93,069 | 111,408 |
Total intangible assets, gross carrying amount | 192,345 | 198,146 |
Intangible Assets, Net (Excluding Goodwill), Total | 110,449 | 128,788 |
Trade Name | ||
Indefinite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 21,440 | 21,440 |
Intangible assets, accumulated amortization | (2,991) | (1,785) |
Total amortization | 18,449 | 19,655 |
Management and Advisory Contracts | ||
Indefinite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross carrying amount | 151,166 | 151,166 |
Intangible assets, accumulated amortization | (77,802) | (60,934) |
Total amortization | 73,364 | 90,232 |
Technology | ||
Indefinite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 30 | 30 |
Finite-lived intangible assets, gross carrying amount | 2,359 | 8,160 |
Intangible assets, accumulated amortization | (1,103) | (6,639) |
Total amortization | 1,256 | 1,521 |
Trade names | ||
Indefinite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | $ 17,350 | $ 17,350 |
Goodwill and Intangibles - Addi
Goodwill and Intangibles - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2022 | |
Trade names | Maximum | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Total amortized life | 16 years |
Trade names | Minimum | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Total amortized life | 7 years |
Technology | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Total amortized life | 4 years |
Goodwill and Intangibles - Esti
Goodwill and Intangibles - Estimated Future Amortization Expense (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of 2022 | $ 6,160 | |
2023 | 21,155 | |
2024 | 17,590 | |
2025 | 13,807 | |
2026 | 10,878 | |
Thereafter | 23,479 | |
Total amortization | $ 93,069 | $ 111,408 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Fair Value of Liabilities (Details) - Fair Value Measurements Recurring Member - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent consideration obligation | $ 24,330 | $ 22,963 |
Total liabilities | 24,330 | 22,963 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent consideration obligation | 0 | 0 |
Total liabilities | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent consideration obligation | 0 | 0 |
Total liabilities | 0 | 0 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent consideration obligation | 24,330 | 22,963 |
Total liabilities | $ 24,330 | $ 22,963 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Changes in the Fair Value of Level III Financial Instruments (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Fair Value Disclosures [Abstract] | ||
Balance, beginning of year: | $ 22,963 | $ 593 |
Additions | 0 | 19,160 |
Change in fair value | 1,367 | 134 |
Settlements | 0 | (727) |
Balance, end of year: | $ 24,330 | $ 19,160 |
Variable Interest Entities - Ad
Variable Interest Entities - Additional Information (Details) - USD ($) $ in Thousands | Sep. 30, 2022 | Dec. 31, 2021 |
Variable Interest Entity [Line Items] | ||
Assets of the consolidated variable interest entities | $ 648,287 | $ 676,217 |
Total Liabilities | 241,075 | 281,053 |
Variable Interest Entity, Primary Beneficiary | ||
Variable Interest Entity [Line Items] | ||
Assets of the consolidated variable interest entities | 393,700 | 413,200 |
Total Liabilities | $ 51,600 | $ 53,600 |
Investment In Unconsolidated _2
Investment In Unconsolidated Subsidiaries - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Schedule of Equity Method Investments [Line Items] | |||||
Income (Loss) from Equity Method Investments | $ 1,296 | $ 781 | |||
Enhanced Capital Group LLC | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Investment in unconsolidated subsidiaries | $ 2,100 | 2,100 | $ 1,800 | ||
Enhanced Capital Group LLC | Asset Management Businesses | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Investment in unconsolidated subsidiaries | 1,900 | 1,900 | 1,600 | ||
Income (Loss) from Equity Method Investments | 200 | $ 300 | 1,300 | $ 800 | |
Partners' Capital Account, Contributions | 0 | 0 | |||
Partners' Capital Account, Distributions | 300 | 1,000 | |||
Enhanced Capital Group LLC | Tax Credit Finance Businesses | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Investment in unconsolidated subsidiaries | 200 | 200 | $ 200 | ||
Enhanced Tax Credit Finance, LLC | Tax Credit Finance Businesses | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Partners' Capital Account, Contributions | 0 | 0 | |||
Partners' Capital Account, Distributions | $ 0 | $ 0 |
Debt Obligations - Schedule of
Debt Obligations - Schedule of Debt Obligations (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Dec. 22, 2021 | Sep. 30, 2022 | Dec. 31, 2021 | |
Line of Credit Facility [Line Items] | |||
Total debt obligations | $ 170,774 | $ 212,496 | |
Term Loan | |||
Line of Credit Facility [Line Items] | |||
Debt issuance costs | (1,293) | (415) | |
Term Loan | 125,000 | 125,000 | |
Total debt obligations | 123,707 | 124,585 | |
Revolving Credit Facility | |||
Line of Credit Facility [Line Items] | |||
Gross revolving credit facility state tax credits | 0 | 0 | |
Debt issuance costs | 0 | (8) | |
Revolving credit facility state tax credits, net | 0 | (8) | |
Withdraw in cash | 49,900 | 90,900 | |
Debt issuance costs | (2,833) | (2,981) | |
Revolver facility, net | 47,067 | 87,919 | |
Total debt obligations | $ 49,900 | $ 90,900 | |
Revolving Credit Facility | Term Loan | |||
Line of Credit Facility [Line Items] | |||
Term Loan | $ 125,000 |
Debt Obligations - Summary of t
Debt Obligations - Summary of terms of the debt obligations (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Line of Credit Facility [Line Items] | |
Aggregate Facility Size | $ 250,000 |
Outstanding Debt | 174,900 |
Amount Available | 75,100 |
Net Carrying Value | $ 170,774 |
Revolving Credit Facility | |
Line of Credit Facility [Line Items] | |
Maturity Date | Dec. 22, 2025 |
Aggregate Facility Size | $ 125,000 |
Outstanding Debt | 49,900 |
Amount Available | 75,100 |
Net Carrying Value | $ 47,067 |
Weighted Average Interest Rate | 3.03% |
Term Loan | |
Line of Credit Facility [Line Items] | |
Maturity Date | Dec. 22, 2025 |
Aggregate Facility Size | $ 125,000 |
Outstanding Debt | 125,000 |
Amount Available | 0 |
Net Carrying Value | $ 123,707 |
Weighted Average Interest Rate | 2.35% |
Term Loan | Revolving Credit Facility | |
Line of Credit Facility [Line Items] | |
Maturity Date | Dec. 22, 2025 |
Debt Obligations - Additional I
Debt Obligations - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||
Dec. 22, 2021 | Oct. 28, 2021 | Jan. 03, 2018 | Oct. 07, 2017 | Oct. 05, 2017 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Mar. 31, 2023 | Dec. 14, 2020 | Oct. 02, 2020 | |
Line of Credit Facility [Line Items] | |||||||||||||
Net Carrying Value | $ 170,774 | $ 170,774 | $ 212,496 | ||||||||||
Payment during period | $ 88,600 | ||||||||||||
Optional Repayment | 86,800 | ||||||||||||
Prepayment Penalty | 1,200 | ||||||||||||
Debt interest payment | $ 600 | ||||||||||||
Amortization of debt issuance costs | 200 | $ 700 | 600 | $ 2,100 | |||||||||
Debt issuance costs | $ 1,400 | 900 | |||||||||||
Revolving Credit Facility | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Notes payable maturity date | Dec. 22, 2025 | ||||||||||||
Net Carrying Value | 49,900 | $ 49,900 | 90,900 | ||||||||||
Gross revolving credit facility state tax credits | 0 | 0 | 0 | ||||||||||
Outstanding Debt | $ 10,000 | $ 10,000 | |||||||||||
Principal Balance | $ 200,000 | ||||||||||||
Debt interest payment | 2,100 | ||||||||||||
Extinguishment Fee | 3,700 | ||||||||||||
Available balance | 125,000 | ||||||||||||
Interest rate above prime rate | 0.25% | 0.25% | |||||||||||
Matures date | Jun. 15, 2022 | ||||||||||||
Unamortized debt issuance expense | $ 0 | $ 0 | 8 | ||||||||||
Term Loan | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Notes payable maturity date | Dec. 22, 2025 | ||||||||||||
Net Carrying Value | 123,707 | $ 123,707 | 124,585 | ||||||||||
Term Loan | 125,000 | 125,000 | |||||||||||
Interest expense | 2,100 | $ 4,600 | |||||||||||
Term Loan | Revolving Credit Facility | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Notes payable maturity date | Dec. 22, 2025 | ||||||||||||
Term Loan | 125,000 | ||||||||||||
Line of credit facility with accordian feature | $ 125,000 | ||||||||||||
Unamortized debt issuance expense | 4,100 | $ 4,100 | 3,400 | ||||||||||
2018 TAB Payments | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Interest expense | 0 | 300 | 0 | 700 | |||||||||
Term SOFR Loans | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Interest Rate Plus | 2.10% | ||||||||||||
Principal contractually repaid rate | 1.25% | ||||||||||||
Senior Secured Credit Facility | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Amount of term loan credit facility | $ 130,000 | ||||||||||||
Unamortized debt issuance expense | $ 0 | $ 0 | $ 0 | ||||||||||
Senior Secured Credit Facility | Line of Credit | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Outstanding Debt | $ 5,000 | ||||||||||||
Senior Secured Credit Facility | Term Loan | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Aggregate on the term loan in tranches | Jul. 31, 2019 | ||||||||||||
Debt instrument, Term | 5 years | ||||||||||||
Outstanding Debt | $ 125,000 | $ 35,000 | $ 35,000 | $ 68,000 | $ 91,400 | ||||||||
Senior Secured Credit Facility | Term Loan | Maximum | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Amount of term loan credit facility | $ 125,000 | ||||||||||||
RCP 2 | 2017 Seller Note | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Notes payable | $ 81,300 | ||||||||||||
Notes payable maturity date | Jan. 15, 2025 | ||||||||||||
RCP 3 | 2018 Seller Note | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Notes payable | $ 22,100 | ||||||||||||
Notes payable maturity date | Jan. 15, 2025 | ||||||||||||
RCP 3 | 2018 TAB Payments | |||||||||||||
Line of Credit Facility [Line Items] | |||||||||||||
Notes payable maturity date | Apr. 15, 2023 | ||||||||||||
Amortized tax benefit | $ 48,400 |
Debt Obligations - Schedule o_2
Debt Obligations - Schedule of Maturities of Long-term Debt (Details) $ in Thousands | Sep. 30, 2022 USD ($) |
Debt Instrument, Redemption [Line Items] | |
2022 | $ 0 |
2023 | 6,250 |
2024 | 6,250 |
2025 | 162,400 |
Long-term Debt, Total | $ 174,900 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Aug. 01, 2022 | Jul. 06, 2022 | Jan. 01, 2021 | Apr. 01, 2020 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | |||||||||
Reimbursable expenses | $ 4,200,000 | $ 1,600,000 | |||||||
Rent expense | $ 800,000 | $ 500,000 | 2,400,000 | $ 1,600,000 | |||||
Accounts receivable related parties | 6,400,000 | 6,400,000 | 2,400,000 | ||||||
Accounts receivable | 6,400,000 | 6,400,000 | 2,400,000 | ||||||
Management And Advisory Fees | 49,996,000 | 38,145,000 | 140,015,000 | 104,901,000 | |||||
Due from related parties | 30,359,000 | 30,359,000 | 12,357,000 | ||||||
Acquisition Partners, LLC | |||||||||
Related Party Transaction [Line Items] | |||||||||
Accounts receivable related parties | 2,200,000 | 2,200,000 | 800,000 | ||||||
Accounts receivable | $ 2,200,000 | $ 2,200,000 | $ 800,000 | ||||||
Common Stock Purchase Agreement | Common Stock | |||||||||
Related Party Transaction [Line Items] | |||||||||
Shares issued | 1,394,052 | 4,646,840 | |||||||
Shares issued, price per share | $ 10.76 | $ 10.76 | |||||||
Stock issued during period value new issues | $ 50,000,000 | ||||||||
Amended Advisory Agreement | |||||||||
Related Party Transaction [Line Items] | |||||||||
Service fee | 0.375% | 1.50% | |||||||
Amended Advisory Agreement | Maximum | |||||||||
Related Party Transaction [Line Items] | |||||||||
Incentive fee | 15% | ||||||||
Amended Advisory Agreement | Minimum | |||||||||
Related Party Transaction [Line Items] | |||||||||
Hurdle Rate | 7% | ||||||||
210 Capital LLC | |||||||||
Related Party Transaction [Line Items] | |||||||||
Rent expense | $ 20,300 | $ 200,000 | 200,000 | ||||||
Lease expiration date | Dec. 31, 2029 | ||||||||
Keystone Capital XXX, LLC | |||||||||
Related Party Transaction [Line Items] | |||||||||
Management fee expense | $ 250,000 | 100,000 | 800,000 | ||||||
Enhanced Capital Group LLC | |||||||||
Related Party Transaction [Line Items] | |||||||||
Advisory Fees | $ 76,000,000 | $ 22,000,000 | |||||||
Advisory fee term | 7 years | 7 years | |||||||
Due from related parties | $ 23,000,000 | 23,000,000 | $ 9,500,000 | ||||||
Enhanced Capital Holding Inc. | |||||||||
Related Party Transaction [Line Items] | |||||||||
Compensation And Benefits | 3,300,000 | 900,000 | 7,900,000 | 6,100,000 | |||||
BCP Partners Holdings, LP | Promissory Note | |||||||||
Related Party Transaction [Line Items] | |||||||||
Due from related parties | 4,000,000 | 4,000,000 | $ 2,600,000 | ||||||
Advisory Fees | Enhanced Capital Group LLC | |||||||||
Related Party Transaction [Line Items] | |||||||||
Management And Advisory Fees | 5,500,000 | 4,800,000 | 16,600,000 | 14,300,000 | |||||
Management and Advisory Fees | |||||||||
Related Party Transaction [Line Items] | |||||||||
Management And Advisory Fees | 49,479,000 | $ 37,939,000 | 138,957,000 | $ 104,029,000 | |||||
Management and Advisory Fees | Common Stock Purchase Agreement | |||||||||
Related Party Transaction [Line Items] | |||||||||
Management And Advisory Fees | 100,000 | 100,000 | |||||||
Management and Advisory Fees | Crossroad Impact Corp | |||||||||
Related Party Transaction [Line Items] | |||||||||
Management And Advisory Fees | $ 1,200,000 | $ 2,200,000 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Loss Contingencies [Line Items] | ||||
Rent expense | $ 0.8 | $ 0.5 | $ 2.4 | $ 1.6 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Company's Operating Leases (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Loss Contingencies [Line Items] | ||
Operating lease right-of-use assets | $ 13,052 | $ 14,789 |
Operating lease liabilities | 15,425 | $ 15,700 |
Cash paid for lease liabilities | $ 1,690 | |
Weighted-average remaining lease term (in years) | 7 years 5 months 19 days | |
Weighted-average discount rate | 4.47% |
Commitments and Contingencies_3
Commitments and Contingencies - Summary of the Future Contractual Lease Payments (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Contractual Obligation, Fiscal Year Maturity Schedule [Abstract] | ||
Remainder of 2022 | $ 538 | |
2023 | 2,976 | |
2024 | 3,222 | |
2025 | 2,066 | |
2026 | 1,727 | |
Thereafter | 8,977 | |
Total undiscounted lease payments | 19,506 | |
Less discount | (3,121) | |
Less construction allowance | (960) | |
Operating lease liabilities | $ 15,425 | $ 15,700 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Income Tax Disclosure [Abstract] | |
Effective rate | 25.90% |
Federal statutory rate | 21% |
Valuation allowance for deferred tax assets | $ 12,800 |
Valuation allowance | $ 0 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||||||
Aug. 16, 2022 | Jun. 17, 2022 | Mar. 15, 2022 | Jul. 20, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Unrecognized stock-based compensation expense | $ 6.4 | $ 6.4 | ||||||
Unrecognized stock-based compensation expense, weighted-average recognition period | 2 years 7 months 6 days | |||||||
Stock-based compensation expense | 7.3 | $ 0.5 | $ 11.5 | $ 1.5 | ||||
Stock purchased under share buyback | $ 1.1 | |||||||
Fair market value option price | $ 11.83 | |||||||
Negotiated discount | 2.50% | |||||||
Share buyback program | 12,500,000 | |||||||
Stock Options | 2018 Incentive Plan | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Additional Award | 0 | |||||||
Number of shares authorized | 14,300,000 | 6,300,000 | ||||||
Date of grant | 10 years | |||||||
Initial shares | 14,300,000 | 6,300,000 | ||||||
Number of additional shares authorized | 5,000,000 | |||||||
Stock issued during period total shares issued for reverse stock splits | 9,300,000 | |||||||
Stock Options | 2018 Incentive Plan | Minimum | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Vesting period | 4 years | |||||||
Stock Options | 2018 Incentive Plan | Maximum | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Vesting period | 5 years | |||||||
Stock Options | 2021 Stock Incentive Plan | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Number of shares available for grant | 3,000,000 | |||||||
Bonaccord Units | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Unrecognized stock-based compensation expense | 8.1 | 8.1 | ||||||
Stock-based compensation expense | $ 3.9 | $ 3.9 | ||||||
Future achievement of performance metrics | $ 17.5 | |||||||
Employee performance obligation met | 294,820 | 294,820 | ||||||
Hark Units | ||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||||||
Unrecognized stock-based compensation expense | $ 0.9 | $ 0.9 | ||||||
Stock-based compensation expense | $ 0.6 | $ 0.6 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Stock Option Activity (Details) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Number of Shares, Beginning balance | shares | 7,095,936 | |
Granted | shares | 1,323,733 | |
Exercised | shares | (41,570) | |
Settled | $ | $ (1,120,000) | |
Expired/Forfeited | shares | (29,985) | |
Number of Shares, Ending balance | shares | 7,228,114 | 7,095,936 |
Number of Shares, Exercisable | shares | 320,440 | |
Weighted Average Exercise Price, Beginning balance | $ / shares | $ 3.71 | |
Granted | $ / shares | 12.28 | |
Exercised | $ / shares | $ 4.80 | |
Settled | 0.41% | |
Expired/Forfeited | $ / shares | $ 10.04 | |
Weighted Average Exercise Price, Ending balance | $ / shares | 5.75 | $ 3.71 |
Exercisable as of June 30, 2022 | $ / shares | $ 3.83 | |
Weighted Average Contractual Life Remaining (in years), Outstanding | 7 years 6 months 3 days | 7 years 5 months 12 days |
Weighted Average Contractual Life Remaining (in years), Exercisable | 6 years 14 days | |
Aggregate Intrinsic Value, Beginning balance | $ | $ 73,156,722 | |
Aggregate Intrinsic Value, Ending balance | $ | 37,496,331 | $ 73,156,722 |
Aggregate intrinsic value exercisable | $ | $ 2,144,803 |
Stockholders' Equity - Summar_2
Stockholders' Equity - Summary of Weighted Average Assumptions Used in Calculating Fair Value of Stock Options Granted (Details) | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Fair Value Assumptions and Methodology [Abstract] | ||
Expected life | 7 years 6 months | 7 years 6 months |
Expected volatility | 35.40% | 40.33% |
Risk-free interest rate | 1.98% | 1.68% |
Expected dividend yield | 0% | 0% |
Stockholders' Equity - Summar_3
Stockholders' Equity - Summary of Restricted Stock Activity (Details) | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Restricted Stock | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Number of Shares, Beginning Balance | shares | 36,033 |
Granted | shares | 33,346 |
Vested | shares | (26,582) |
Forfeited | shares | 0 |
Number of Shares, Ending Balance | shares | 42,797 |
Weighted-Average Grant Date Fair Value Per RSU | |
Weighted-Average Grant Date Fair Value, Beginning balance | $ / shares | $ 11.24 |
Granted | $ / shares | 12.37 |
Vested | $ / shares | 11.24 |
Forfeited | $ / shares | 0 |
Weighted-Average Grant Date Fair Value, Ending Balance | $ / shares | $ 12.12 |
Restricted stock units | |
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Number of Shares, Beginning Balance | shares | 59,654 |
Granted | shares | 802,955 |
Vested | shares | (294,820) |
Forfeited | shares | 0 |
Number of Shares, Ending Balance | shares | 567,789 |
Weighted-Average Grant Date Fair Value Per RSU | |
Weighted-Average Grant Date Fair Value, Beginning balance | $ / shares | $ 12.74 |
Granted | $ / shares | 9.03 |
Vested | $ / shares | 11.12 |
Forfeited | $ / shares | 0 |
Weighted-Average Grant Date Fair Value, Ending Balance | $ / shares | $ 9.42 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Computation of Basic and Diluted EPS (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Numerator: | ||||
Numerator for earnings per share assuming dilution | $ 5,617 | $ 2,515 | $ 24,563 | $ 5,661 |
Denominator: | ||||
Denominator for basic calculation - Weighted-average shares | 117,210 | 62,465 | 117,210 | 62,465 |
Weighted shares assumed upon exercise of stock options | 4,322 | 4,323 | 4,152 | 4,238 |
Denominator for earnings per share assuming dilution | 121,532 | 66,788 | 121,362 | 66,703 |
Earnings per share - basic | $ 0.05 | $ 0.04 | $ 0.21 | $ 0.09 |
Earnings per share - diluted | $ 0.05 | $ 0.04 | $ 0.20 | $ 0.08 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Details) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Stock Options | Common Stock [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of earnings per share | 1 | 0 | 1 | 2.9 |
Redeemable Noncontrolling Int_2
Redeemable Noncontrolling Interest - Additional Information (Details) - P10 Intermediate | Sep. 30, 2022 |
Redeemable Convertible Preferred Stock | |
Class of Stock [Line Items] | |
Percentage of aggregate shares outstanding, issued to third party | 40.90% |
Percentage of aggregate shares outstanding, issued to parent | 59.10% |
Common Stock | |
Class of Stock [Line Items] | |
Percentage of aggregate shares outstanding, issued to parent | 100% |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended | |
Oct. 13, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | |
Subsequent Event [Line Items] | |||
Aggregate membership units | 1,323,733 | ||
Revolving Credit Facility | |||
Subsequent Event [Line Items] | |||
Outstanding Debt | $ 10,000 | ||
Withdraw in cash | $ 49,900 | $ 90,900 | |
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Outstanding Debt | $ 125,000 | ||
Subsequent Event | Westech Investment Advisors LLC [Member] | |||
Subsequent Event [Line Items] | |||
Purchase consideration | 97,000 | ||
Earnout payments | $ 70,000 | ||
Aggregate membership units | 3,916,666 | ||
Subsequent Event | Westech Investment Advisors LLC [Member] | 2021 Incentive Plan [Member] | |||
Subsequent Event [Line Items] | |||
Aggregate membership units | 3,595,000 | ||
Vesting period | 5 years | ||
Options expiration period | 10 years | ||
Subsequent Event | Westech Investment Advisors LLC [Member] | Revolving Credit Facility | |||
Subsequent Event [Line Items] | |||
Outstanding Debt | $ 37,500 | ||
Withdraw in cash | 6,000 | ||
Subsequent Event | Westech Investment Advisors LLC [Member] | Term Loan | |||
Subsequent Event [Line Items] | |||
Outstanding Debt | 87,500 | ||
Withdraw in cash | $ 87,500 | ||
Subsequent Event | Common Class A | |||
Subsequent Event [Line Items] | |||
Common Stock, Dividends, Per Share, Declared | $ 0.03 | ||
Subsequent Event | Common Class B | |||
Subsequent Event [Line Items] | |||
Common Stock, Dividends, Per Share, Declared | $ 0.03 |