Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 02, 2018 | |
Document And Entity Information | ||
Entity Registrant Name | Inuvo, Inc. | |
Entity Central Index Key | 829,323 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2018 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 32,435,446 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Current assets | ||
Cash | $ 4,190,274 | $ 4,084,686 |
Accounts receivable, net of allowance for doubtful accounts of $43,727 and $83,789, respectively. | 5,614,031 | 10,759,250 |
Prepaid expenses and other current assets | 307,256 | 400,191 |
Total current assets | 10,111,561 | 15,244,127 |
Property and equipment, net | 2,260,967 | 2,306,279 |
Other assets | ||
Goodwill | 9,853,342 | 9,853,342 |
Intangible assets, net of accumulated amortization | 9,779,307 | 10,808,018 |
Other assets | 35,171 | 36,070 |
Total other assets | 19,667,820 | 20,697,430 |
Total assets | 32,040,348 | 38,247,836 |
Current liabilities | ||
Accounts payable | 9,021,255 | 13,614,053 |
Accrued expenses and other current liabilities | 2,456,831 | 2,887,816 |
Revolving credit line | 4,825,000 | 4,900,000 |
Total current liabilities | 16,303,086 | 21,401,869 |
Long-term liabilities | ||
Deferred tax liability | 2,331,900 | 2,331,900 |
Other long-term liabilities | 250,959 | 426,725 |
Total long-term liabilities | 2,582,859 | 2,758,625 |
Preferred stock: | ||
Preferred stock, $.001 par value: Authorized shares 500,000, none issued and outstanding | 0 | 0 |
Common stock: | ||
Common stock, $.001 par value: Authorized shares 40,000,000; issued shares 32,810,202 and 28,994,981, respectively; outstanding shares 32,433,675 and 28,618,454, respectively | 32,811 | 28,996 |
Additional paid-in capital | 138,779,584 | 136,033,967 |
Accumulated deficit | (124,261,433) | (120,579,062) |
Treasury stock, at cost - 376,527 shares | (1,396,559) | (1,396,559) |
Total stockholders' equity | 13,154,403 | 14,087,342 |
Total liabilities and stockholders' equity | $ 32,040,348 | $ 38,247,836 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Assets | ||
Allowance for doubtful accounts | $ 43,727 | $ 83,789 |
Stockholders Equity | ||
Preferred stock par value (in usd per share) | $ 0.001 | $ 0.001 |
Preferred stock shares authorized (in shares) | 500,000 | 500,000 |
Preferred stock shares issued (in shares) | 0 | 0 |
Preferred stock shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Common stock shares authorized (in shares) | 40,000,000 | 40,000,000 |
Common stock shares issued (in shares) | 32,810,202 | 28,994,981 |
Common stock shares outstanding (in shares) | 32,433,675 | 28,618,454 |
Treasury stock (in shares) | 376,527 | 376,527 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Income Statement [Abstract] | ||||
Net revenue | $ 16,806,170 | $ 20,311,502 | $ 56,315,006 | $ 55,798,545 |
Cost of revenue | 6,196,057 | 9,649,295 | 21,965,955 | 25,161,761 |
Gross profit | 10,610,113 | 10,662,207 | 34,349,051 | 30,636,784 |
Operating expenses | ||||
Marketing costs (traffic acquisition costs or TAC) | 8,285,465 | 7,161,905 | 25,025,922 | 21,122,489 |
Compensation | 1,806,111 | 2,363,901 | 6,749,280 | 7,053,308 |
Selling, general and administrative | 1,859,020 | 2,025,254 | 5,968,233 | 6,308,552 |
Total operating expenses | 11,950,596 | 11,551,060 | 37,743,435 | 34,484,349 |
Operating loss | (1,340,483) | (888,853) | (3,394,384) | (3,847,565) |
Interest expense, net | (101,167) | (97,318) | (296,612) | (212,922) |
Loss from continuing operations before taxes | (1,441,650) | (986,171) | (3,690,996) | (4,060,487) |
Income tax benefit | 0 | 0 | 8,625 | 0 |
Net loss from continuing operations | (1,441,650) | (986,171) | (3,682,371) | (4,060,487) |
Net loss from discontinued operations | 0 | 0 | 0 | (1,109) |
Net loss | $ (1,441,650) | $ (986,171) | $ (3,682,371) | $ (4,061,596) |
Per common share data: Basic and diluted | ||||
Net loss from continuing operations (in usd per share) | $ (0.04) | $ (0.03) | $ (0.12) | $ (0.14) |
Net loss from discontinued operations (in usd per share) | 0 | 0 | 0 | 0 |
Net loss (in usd per share) | $ (0.04) | $ (0.03) | $ (0.12) | $ (0.14) |
Weighted average shares | ||||
Basic (in shares) | 32,316,988 | 28,553,055 | 30,540,796 | 28,030,902 |
Diluted (in shares) | 32,316,988 | 28,553,055 | 30,540,796 | 28,030,902 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Operating activities: | ||
Net loss | $ (3,682,371) | $ (4,061,596) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 2,371,958 | 2,239,498 |
Stock based compensation | 827,595 | 923,072 |
Amortization of financing fees | 19,200 | 19,200 |
(Recovery) Provision of doubtful accounts | (40,062) | 138,789 |
Adjustment of European liabilities related to discontinued operations | 0 | 1,109 |
Change in operating assets and liabilities: | ||
Accounts receivable | 5,183,579 | (237,078) |
Prepaid expenses and other liabilities | 74,634 | 81,485 |
Accounts payable | (4,592,798) | (1,099,692) |
Accrued expenses and other liabilities | (445,857) | (967,553) |
Net cash used in operating activities | (284,122) | (2,962,766) |
Investing activities: | ||
Purchases of equipment and capitalized development costs | (1,300,179) | (1,062,811) |
Net cash received from 2017 asset acquisition | 0 | 235,763 |
Net cash used in investing activities | (1,300,179) | (827,048) |
Financing activities: | ||
Net proceeds from sale of common stock | 2,000,583 | 0 |
Net (payments) proceeds on revolving credit line | (75,000) | 5,000,000 |
Net taxes paid on RSU grants exercised | (77,044) | (97,376) |
Payments on capital leases | (158,650) | (97,300) |
Treasury stock repurchase | 0 | (44,772) |
Payoff of 2017 asset acquisition debt acquired | 0 | (2,015,577) |
Net cash provided by financing activities | 1,689,889 | 2,744,975 |
Net change – cash | 105,588 | (1,044,839) |
Cash, beginning of year | 4,084,686 | 3,946,804 |
Cash, end of period | 4,190,274 | 2,901,965 |
Supplemental information: | ||
Interest paid | 287,374 | 180,796 |
Non cash investing and financing activities: | ||
2017 asset acquisition stock issuance (See Note 13) | 0 | 4,459,244 |
Purchase of property and equipment under capital lease | 0 | 523,518 |
Write-down of domain names and corresponding contingent liability | $ 0 | $ 222,477 |
Organization and Business
Organization and Business | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Business | Organization and Business Company Overview We develop technology that connects advertisers with consumers through interactions with content across devices. Inuvo provides the means to interact with tens of thousands of advertisers ("Demand") and tens of thousands of online publishers ("Supply"). We interact with Demand/Supply constituents directly and indirectly. We serve ads that associate with images, content, video and slideshows. We generate revenue from buyers of advertising inventory which include media partners, advertisers, agencies, agency trading desks, demand-side platforms and ad networks, collectively “Demand.” Our solution incorporates a proprietary form of artificial intelligence (“AI”) branded the IntentKey. This sophisticated machine learning technology uses interactions with Internet content as a source of information from which to determine Intent. The AI solution includes a continually updated database of over 500 million machine profiles which we utilize to deliver highly targeted online audiences to our Demand customers. We earn revenue when consumers view and/or click on our ads. Our business scales as we add Demand and Supply relationships. We count among our many contractual relationships, three clients who collectively manage over 50% of all US digital advertising budgets. Included within our Supply portfolio is a collection of owned websites such as alot.com and earnspendlive.com, where we create content in health, finance, travel, careers, auto, education and living categories. These sites provide the means to test advertising technologies, while also delivering high quality consumers to advertisers through interaction with proprietary content in the form of images, videos, slideshows and the written word. There are many barriers to entry to our business including the ability to process billions of transactions daily. Our intellectual property is protected by 15 issued and eight pending patents. Liquidity On October 11, 2018, we entered into the Amended and Restated Business Financing Agreement (the “Amended and Restated Financing Agreement”) with Western Alliance Bank. The Amended and Restated Financing Agreement, which is secured by all of our assets, superseded in its entirety the prior the Business Financing Agreement, as amended, that we entered into on March 1, 2012 with Bridge Bank, N.A. which is now owned by Western Alliance Bank. The Amended and Restated Financing Agreement does not have a term and either party may terminate upon notice to the other party. As a result of the amended terms of our lending relationship with Western Alliance Bank, we have additional access to credit (See Note 5 in the Notes to Consolidated Financial Statements). In May 2018, we completed our underwritten public offering of 2,860,000 shares of our common stock at a public offering price of $0.70 per share and an additional 429,000 shares to cover overallotments in connection with the offering. The net proceeds after deducting the underwriting discounts and commissions and estimated offering expenses payable was approximately $2.1 million. During the third quarter of 2017, we filed an S-3 registration statement with the Securities and Exchange Commission ("SEC") to replace the existing, expiring S-3 "shelf" registration statement, which permits us to offer and sell up to $15 million of our securities from time to time in one or more offerings. In May 2018, we took down from this shelf registration statement approximately $2.3 million in the underwritten public offering. For the three months ended September 30, 2018, our revenues declined 17.3% from the same quarter in the prior year. The lower revenue in this year’s quarter is principally responsible for our $1.4 million net loss in the third quarter of 2018. Since our credit facility is dependent upon receivables, the We do not know when, if ever, that our revenues will return to historic levels or if we will be able to replace those lost revenues with revenues from other demand partners. The combination of lower credit availability and negative cash flows generated from operating activities raises concern about our ability to continue without interruption. As described in note 15 to the notes to consolidated financial statements appearing earlier in this report, on November 2, 2018, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with ConversionPoint Technologies, Inc. (“CPT”) and certain related parties which provides that at the closing of this pending transaction (the “Merger”), which is subject to a number of conditions precedent, the Company will become a wholly-owned subsidiary of CPT. There are no assurances the Merger will be consummated. In addition, on November 2, 2018, we borrowed $1 million from an affiliate of CPT which we are using for working capital, and on November 2, 2018, four directors of the Company lent us $62,500 each, for an aggregate of $250,000, to cover certain costs associated with the pending Merger. Subject to the terms of the Merger Agreement and the credit facility with the additional borrowing, we believe we will have sufficient cash and credit to operate until the Merger closes. There are no assurances we will be successful in our efforts to generate revenues, report profitable operations or close the Merger in which case we would need to find additional sources of credit and make substantial reductions to operating expense. Customer concentration We generated the majority of our revenue from two Demand side customers, Yahoo! and Google as noted below: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2018 2017 2018 2017 Yahoo! 75.6% 62.1 % 72.9 % 68.5 % Google 8.5% 8.9 % 9.0 % 10.8 % Total 84.1% 71.0 % 81.9 % 79.3 % As of September 30, 2018, Yahoo! and Google accounted for 70.0% of our gross accounts receivable balance. As of December 31, 2017, two Demand side customers, Yahoo! and OpenX, accounted for 71.3% of our gross accounts receivable balance. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of presentation The consolidated financial statements presented are for Inuvo, Inc. and its consolidated subsidiaries. The accompanying unaudited consolidated financial statements have been prepared based upon SEC rules that permit reduced disclosure for interim periods. Certain information and footnote disclosures have been condensed or omitted in accordance with those rules and regulations. The accompanying consolidated balance sheet as of December 31, 2017, was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States ("GAAP"). In our opinion, these consolidated financial statements reflect all adjustments that are necessary for a fair presentation of results of operations and financial condition for the interim periods shown including normal recurring accruals and other items. The results for the interim periods are not necessarily indicative of results for the full year. For a more complete discussion of significant accounting policies and certain other information, this report should be read in conjunction with the consolidated financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December 31, 2017, which was filed with the SEC on February 8, 2018. Use of estimates The preparation of financial statements, in accordance with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, net revenues and expenses and disclosure of contingent assets and liabilities. The estimates and assumptions used in the accompanying consolidated financial statements are based upon management’s regular evaluation of the relevant facts and circumstances as of the date of the consolidated financial statements. We regularly evaluate estimates and assumptions related to allowances for doubtful accounts, accrued sales reserve, goodwill and purchased intangible asset valuations, lives of intangible assets, deferred income tax asset valuation allowances and stock compensation. Actual results may differ from the estimates and assumptions used in preparing the accompanying consolidated financial statements, and such differences could be material. Revenue Recognition In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (Topic 606) "Revenue from contracts with Customers." Topic 606 supersedes the revenue recognition requirements in Topic 605 “Revenue Recognition” (Topic 605) and requires entities to recognize revenue when control of the promised goods or services is transferred to customers at an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted this guidance on January 1, 2018 using the modified retrospective approach. The adoption of Topic 606 from Topic 605 had no cumulative impact on retained earnings and no impact on revenue reported as of September 30, 2018. Effective January 1, 2018, we recognize revenue following the five-step process outlined in Topic 606. We identify and have on file contracts with all customers. Our contracts with our major search partners pay upon delivery of a click. Additionally, our contracts with advertisers pay upon the serving of impressions. Our performance obligation is met when we deliver a click to a search partner or serve an impression to a digital publisher. We satisfy the performance obligation and recognize revenue when a click occurs from advertisements served to our digital properties or to those of our publishing partners in the period in which the click occurs. We serve as the principal in our contracts because we control the service to be performed by our publishing partners. The Company is ultimately responsible for fulfilling the promise to its customers and has latitude in pricing and publisher selection. There is no transaction price allocated to unsatisfied performance obligation and there were no contract assets or liabilities as of the date of adoption and as of September 30, 2018. The following table presents our revenue disaggregated by channel: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2018 2017 2018 2017 Mobile $ 12,532,579 $ 12,899,583 $ 39,800,781 $ 33,241,487 Desktop 4,014,356 7,202,772 15,671,684 21,790,230 Other 259,235 209,147 842,541 766,828 Total $ 16,806,170 $ 20,311,502 $ 56,315,006 $ 55,798,545 Recent accounting pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This standard will require all leases with durations greater than twelve months to be recognized on the balance sheet and is effective for interim and annual reporting periods beginning after December 15, 2018, although early adoption is permitted. We believe adoption of this standard will have an impact on our consolidated balance sheets. Although we have not completed our assessment, we do not expect the adoption to change the recognition, measurement or presentation of lease expenses within the results of operations. |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment The net carrying value of property and equipment was as follows as of: September 30, 2018 December 31, 2017 Furniture and fixtures $ 293,152 $ 288,536 Equipment 1,525,057 1,509,464 Capitalized internal use and purchased software 8,809,333 7,582,181 Leasehold improvements 421,016 455,850 Subtotal 11,048,558 9,836,031 Less: accumulated depreciation and amortization (8,787,591) (7,529,752) Total $ 2,260,967 $ 2,306,279 |
Other Intangible Assets and Goo
Other Intangible Assets and Goodwill | 9 Months Ended |
Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Other Intangible Assets and Goodwill | Other Intangible Assets and Goodwill The following is a schedule of intangible assets as of September 30, 2018: Term Carrying Value Accumulated Amortization Net Carrying Value Year-to-date Amortization Customer list, Google 20 years $ 8,820,000 $ (2,903,250) $ 5,916,750 $ 330,750 Technology 5 years 3,600,000 (1,200,000) 2,400,000 540,000 Customer list, all other 10 years 1,610,000 (1,059,943) 550,057 120,753 Customer relationships 20 years 570,000 (47,500) 522,500 21,375 Trade names, web properties (1) - 390,000 — 390,000 — Brand 1 year 121,000 (121,000) — 10,083 Non-competition agreements 1 year 69,000 (69,000) — 5,750 Intangible assets classified as long-term $ 15,180,000 $ (5,400,693) $ 9,779,307 $ 1,028,711 Goodwill, total - $ 9,853,342 $ — $ 9,853,342 $ — (1) The trade names related to our web properties have an indefinite life, and as such are not amortized. Amortization expense over the next five years and thereafter is as follows: 2018 $ 337,626 2019 1,350,504 2020 1,350,504 2021 1,350,504 2022 556,294 Thereafter 4,443,875 Total $ 9,389,307 |
Revolving Credit Line
Revolving Credit Line | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Revolving Credit Line | Revolving Credit Line The following table summarizes our revolving credit line balances as of: September 30, 2018 December 31, 2017 Revolving credit line - 6.25 percent at September 30, 2018 (prime plus 1.0 percent), due October 20, 2018 $ 4,825,000 $ 4,900,000 Total $ 4,825,000 $ 4,900,000 On October 11, 2018, we entered into the Amended and Restated Business Financing Agreement with Western Alliance Bank and superseded the Business Financing Agreement, as amended, we entered into on March 1, 2012 with Bridge Bank, N.A. which is now owned by Western Alliance Bank. The Amended and Restated Financing Agreement may be terminated by either party upon notice to the other party. As a result of the Amended and Restated Financing Agreement we have access to additional credit. The material terms of the Amended and Restated Financing Agreement include financing eligible invoiced receivables at an advance rate of 85% and an interest rate of prime plus 1% and a sub-limit of up to $2.5 million of uninvoiced eligible receivables at an advance rate of 75% and an interest rate of prime plus 2%. The sub-limit provision expires at the end of January 2019. The Amended and Restated Financing Agreement includes certain fees; a facility fee of $11,765 due at closing; an annual facility fee of 0.25% of the account balance due beginning on April 20, 2019; a monthly maintenance fee of 0.125% of the ending daily account balance; a $30,000 fee in lieu of a warrant; and $75,000 due upon termination of the agreement or repayment of our obligations under the agreement. The Amended and Restated Financing Agreement is secured by all of our assets. On September 19, 2018, we entered into the Eleventh Business Financing Modification Agreement with Western Alliance Bank that modified the existing agreement by extending the maturity date to October 20, 2018. On March 1, 2012, we entered into a Business Financing Agreement with Bridge Bank, which is now owned by Western Alliance Bank. On April 18, 2018, we entered into the Tenth Business Financing Modification Agreement with Western Alliance Bank the parent company of Bridge Bank, N.A., our original lender, that modified the existing agreement. The modified terms require a monthly quick ratio of not less than .60 to 1.00 from February 1, 2018 through November 30, 2018; and a monthly quick ratio of not less than .70 to 1.00 on and after December 31, 2018; and the quarterly consolidated Adjusted EBITDA shall not negatively deviate from financial projections by more than $18,000 for the quarter ending March 31, 2018, $57,000 for the quarter ending June 30, 2018, $191,000 for the quarter ended September 30, 2018 and $496,000 for the quarter ended December 31, 2018, or with respect to any quarter in 2019 and beyond, by more than 25% from projections. In addition, the finance charge for outstanding advances is equal to Prime Rate plus one basis point. The agreement provided us with a revolving credit line of up to $10 million which we use to help satisfy our working capital needs. We have provided Western Alliance Bank with a first priority perfected security interest in all of our accounts and personal property as collateral for the credit facility. Available funds under the revolving credit line are 85% of eligible accounts receivable balances up to a limit of $10 million. Eligible accounts receivable is generally defined as those from United States based customers that are not more than 90 days from the date of invoice less certain contra accounts. We had no availability under the revolving credit line as of September 30, 2018 and the outstanding balance due on the revolving line of credit was $4.8 million. We were not in compliance with the agreement’s financial covenants as of September 30, 2018 and received a waiver from the bank of compliance with the financial covenants. |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 9 Months Ended |
Sep. 30, 2018 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Other Current Liabilities | Accrued Expenses and Other Current Liabilities The accrued expenses and other current liabilities consist of the following as of: September 30, 2018 December 31, 2017 Accrued marketing costs (TAC) $ 1,654,053 $ 1,107,404 Accrued expenses and other 315,524 624,688 Capital leases, current portion 204,430 209,940 Accrued payroll and commission liabilities 184,405 867,634 Accrued sales allowance 50,000 50,000 Arkansas grant reserve 25,000 2,245 Accrued taxes 23,419 25,905 Total $ 2,456,831 $ 2,887,816 |
Other Long-Term Liabilities
Other Long-Term Liabilities | 9 Months Ended |
Sep. 30, 2018 | |
Other Liabilities Disclosure [Abstract] | |
Other Long-Term Liabilities | Other Long-Term Liabilities Other long-term liabilities consist of the following as of: September 30, 2018 December 31, 2017 Capital leases, less current portion $ 128,329 $ 281,470 Deferred rent 108,868 131,493 Accrued taxes, less current portion 13,762 13,762 Total $ 250,959 $ 426,725 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesWe have a deferred tax liability of $2,331,900 as of September 30, 2018 and December 31, 2017, related to intangible assets acquired in March 2012 and February 2017. We also have a net deferred tax asset of $32,503,735. We believe it is more likely than not that essentially none of our deferred tax assets will be realized, and we have recorded a valuation allowance for the net deferred tax assets that may not be realized as of September 30, 2018 and December 31, 2017. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation We maintain a stock-based compensation program intended to attract, retain and provide incentives for talented employees and directors and align stockholder and employee interests. Currently, we grant options and restricted stock units ("RSUs") from the 2010 Equity Compensation Plan (“2010 ECP”) and 2017 Equity Compensation Plan ("2017 ECP"). Option and RSUs vesting periods are generally up to three Compensation Expense For the three and nine months ended September 30, 2018, we recorded stock-based compensation expense for all equity incentive plans of $159,799 and $827,595, respectively. For the three and nine months ended September 30, 2017, we recorded stock-based compensation expense for all equity incentive plans of $336,913 and $923,072, respectively. Total compensation cost not yet recognized at September 30, 2018 was $1,138,696 to be recognized over a weighted-average recognition period of 1.7 years. The following table summarizes the stock grants outstanding under our 2005 Long-Term Incentive Plan ("2005 LTIP"), the 2010 ECP and the 2017 ECP as of September 30, 2018: Options Outstanding RSUs Outstanding Options and RSUs Exercised Available Shares Total 2017 ECP — 733,500 41,664 1,374,836 2,150,000 2010 ECP 250,498 910,449 3,380,919 290,152 4,832,018 2005 LTIP (*) 13,748 — 950,085 — 963,833 Total 264,246 1,643,949 4,372,668 1,664,988 7,945,851 (*) Expired June 2015 The following table summarizes the activities of stock option awards under the 2005 LTIP and the 2010 ECP as of September 30, 2018: Shares Subject to Options Outstanding Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Balance as of December 31, 2017 264,246 $ 2.84 2.7 $ 2,019 Stock options exercised — $ — — — Balance as of September 30, 2018 264,246 $ 2.84 2.7 $ 2,019 Stock options exercisable as of September 30, 2018 264,246 $ 2.84 2.7 $ 2,019 The following table summarizes the activities for our unvested RSUs for the nine months ended September 30, 2018: Unvested RSUs Number of Shares Weighted Average Grant Date Fair Value Unvested as of December 31, 2017 1,071,538 $ 1.84 Granted 1,664,266 $ 0.76 Vested 641,843 $ 2.26 Forfeited 450,012 $ 1.05 Unvested as of September 30, 2018 1,643,949 $ 0.80 |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Sep. 30, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued OperationsCertain of our subsidiaries previously operated in the European Union ("EU"). Though our operations ceased in 2009, statutory requirements required a continued presence in the EU for varying terms until November 2015. Profits and losses generated from the remaining assets and liabilities are accounted for as discontinued operations. In the third quarter of 2016, our petition with the UK (United Kingdom) Companies House to strike off and dissolve our remaining subsidiary in the EU was approved. As a result, for the nine months ended September 30, 2017, we recorded a net loss of $1,109 due to a charge from a service provider. |
Earnings per Share
Earnings per Share | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per ShareDuring the three and nine month periods ended September 30, 2018 and September 30, 2017, we generated a net loss from continuing operations and as a result, all of our shares are anti-dilutive. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2018 | |
Leases [Abstract] | |
Leases | Leases We lease certain office space and equipment. As leases expire, it can be expected that they will be renewed or replaced in the normal course of business. Rent expense from continuing operations was $101,767 and $309,596 for the three and nine months ended September 30, 2018, respectively, and $109,701 and $346,717 for the three and nine months ended September 30, 2017, respectively. Minimum future lease payments under non-cancelable operating leases as of September 30, 2018 are: 2018 $ 118,870 2019 477,319 2020 405,606 2021 242,558 2022 163,284 Total $ 1,407,637 In April 2015, we entered into a five As part of the 2017 asset acquisition, Inuvo assumed the office space lease and a lease obligation in Sunnyvale, CA. The lease was for 15,717 square feet and cost approximately $95,000 for the remaining term of the lease which expired in July 2017. In June 2017, we entered into an agreement to lease 4,801 square feet of office space in San Jose, CA commencing on July 17, 2017. The lease has a term of five In June 2017, we entered into an agreement with Dell Financial Services to lease computer equipment for our data centers. The lease has a term of three Capital lease obligations and future minimum lease payments under non-cancelable capital leases as of September 30, 2018 are: Lease Payments 2018 $ 59,527 2019 $ 213,685 2020 $ 82,404 Total payments under capital lease obligations $ 355,616 Less amount representing interest (22,857) Present value of capital lease obligations 332,759 Current portion of capital lease obligations (204,430) Capital lease obligations, net of current portion $ 128,329 Assets acquired under capital lease obligations are included in property and equipment in the accompanying consolidated balance sheets. Cost and related accumulated depreciation as of: September 30, 2018 December 31, 2017 Equipment $ 707,264 $ 707,264 Less accumulated depreciation (393,806) (242,169) Equipment, net $ 313,458 $ 465,095 Depreciation expense on assets under capital lease obligations was $47,277 and $151,637 for the three and nine months ended September 30, 2018, respectively, and $107,531 and $66,245 for the three and nine months ended September 30, 2017, respectively, and is included in the consolidated statements of operations. In February 2017, we acquired assets and certain liabilities including the capital lease for computer equipment with a remaining value at that time of $88,575. three |
Asset Acquisition 2017
Asset Acquisition 2017 | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
2017 Asset Acquisition | 2017 Asset AcquisitionOn February 6, 2017, we entered into an Asset Purchase Agreement to acquire substantially all of the assets and certain liabilities and personnel obligations, in exchange for 3,529,000 shares of our common stock. Of this amount, 529,350 shares were deposited into escrow with our counsel under the terms of an escrow agreement pending possible post-closing adjustments in the purchase price related to working capital and audited financial statement adjustments, as well as in connection with possible indemnification claims post-closing. In August 2017, these shares were released from escrow and delivered to the sellers in accordance with the terms of the Asset Purchase Agreement. The operating results of this acquisition have been included in the consolidated statements of operations since the acquisition date. As a result of the business acquisition, the Company recognized goodwill in the amount of $4,013,034. The factors contributing to the recognition of the amount of goodwill are based on strategic benefits that are expected to be realized from the asset acquisition. The Company incurred approximately $350,000 in acquisition related costs, which are recorded in selling, general and administrative expenses in the accompanying consolidated statements of operations. Total consideration paid in common stock (with marketability discount applied) $ 4,459,244 Fair value of assets acquired: Accounts receivable, net (2,292,485) Prepaid expenses and other current assets (236,163) Property and equipment, net (119,101) Goodwill (4,013,034) Intangible assets (4,360,000) Fair value of liabilities assumed: Accounts payable $ 3,579,787 Accrued expenses and other current liabilities 1,152,789 Other long-term liabilities 49,149 Debt 2,015,577 Cash received in acquisition $ 235,763 In accordance with ASC guidance related to business combinations, net consideration was first allocated to the fair value of assets acquired, including specifically identifiable intangible assets and liabilities assumed, with the excess being recorded as goodwill. Goodwill related to this acquisition is not deductible for tax purposes and is not amortized, but instead is subject to periodic impairment tests. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party TransactionsFor the three and nine months ended September 30, 2018, the Company received a total of $10,500 and $31,500, respectively, and for the three and nine months ended September 30, 2017, $27,576 and $91,718, respectively, from First Orion Corp., which is partially owned by two directors and shareholders of Inuvo, for providing IT services. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Effective October 11, 2018, the Company entered into a new agreement with Western Alliance Bank for a working capital credit line (see Note 5). On November 2, 2018 the Company entered into an Indemnification Agreement with each of the current directors and executive officers of the Company (collectively, the “Indemnities”). The Indemnification Agreements clarify and supplement indemnification provisions already contained in the Company's Bylaws and generally provide that the Company shall indemnify the Indemnities to the fullest extent permitted by applicable law, subject to certain exceptions, against expenses, judgments, fines and other amounts actually and reasonably incurred in connection with their service as a director or officer and also provide for rights to advancement of expenses and contribution. On November 2, 2018, the Company entered into the Merger Agreement with CPT, ConversionPoint Holdings, Inc., a wholly-owned subsidiary of CPT (“Parent”), CPT Merger Sub, Inc., a wholly-owned subsidiary of Parent (“CPT Merger Sub”), and CPT Cigar Merger Sub, Inc., a wholly-owned subsidiary of Parent (“Inuvo Merger Sub”). The Merger Agreement provides that, upon the terms and subject to the conditions set forth therein, the Company will merge with and into Inuvo Merger Sub with the Company as the surviving corporation in the Inuvo Merger (the “Inuvo Merger”), and CPT merging with and into CPT Merger Sub with CPT as the surviving corporation in the CPT Merger (the “CPT Merger” and collectively with the Inuvo Merger, the “Merger”). Upon consummation of the Merger, CPT and Inuvo will be wholly-owned subsidiaries of Parent. The Merger Agreement was unanimously approved by the Board of Directors of each of the Company, CPT, Parent, CPT Merger Sub, and Inuvo Merger Sub. Upon the terms and subject to the conditions set forth in the Merger Agreement, at the effective time of the Merger the Company’s shareholders will be entitled to receive $0.45 in cash and 0.18877 shares of Parent common stock for each share of common stock of the Company, and CPT’s stockholders will be entitled to receive 0.9840 shares of Parent common stock for each share of common stock of CPT. Each outstanding option to acquire a share of the Company’s common stock will be converted into an option to acquire 0.2370 shares of Parent’s common stock. In addition, unvested restricted stock units will vest in full immediately prior to consummation of the Merger and will be entitled to receive the merger consideration. No fractional shares of Parent common stock will be issued in the Merger and Parent stockholders and CPT stockholders will receive cash in lieu of any fractional interests. The Merger Agreement contains customary representations and warranties from each party to the agreement, and each party has agreed to customary covenants, including, among others, covenants relating to (1) the conduct of the CPT’s and the Company’s businesses during the interim period between the execution of the Merger Agreement and the closing of the Merger, (2) the Company’s obligations to facilitate its shareholders’ consideration of, and voting upon, the Merger Agreement and the Inuvo Merger, (3) CPT’s obligations to facilitate its stockholders’ consideration of, and voting upon, the Merger Agreement and the CPT Merger, (4) the recommendation by the Board of Directors of the Company in favor of approval of the Merger Agreement and the Inuvo Merger by the Company’s shareholders, and (5) the Company’s non-solicitation obligations relating to alternative business combination transactions. The completion of the Merger is subject to (1) the approval of CPT’s stockholders and the Company’s shareholders, (2) regulatory approvals, (3) the closing of financing to the Parent of $36,000,000 (the “Financing”), (4) the approval of the listing of shares of Parent’s common stock on NASDAQ and conditional approval for listing on the TSX, (5) the delivery of customary opinions from counsel to the CPT and the Company to the effect that the Merger will qualify as a tax-free exchange for federal income tax purposes (6) Parent entering into separation agreements with Mr. Howe, the Company Chief Executive Officer, Mr. Ruiz, the Company’s Chief Financial Officer and Secretary, and Mr. Pisaris, the Company’s General Counsel, and (7) other customary closing conditions. Immediately following the Merger, Richard K. Howe will serve as non-executive chairman of the board of directors of the Parent and an additional individual appointed by Inuvo shall serve on the seven member board of directors of the Parent. The Merger Agreement contains customary termination rights for both the Company and CPT and further provides that (1) a termination payment of approximately $2.8 million will be payable by the Company to CPT in certain circumstances; and (2) a termination payment of approximately $2.8 million will be payable by CPT to the Company in certain circumstances, including if the Parent fails to consummate the Financing by May 31, 2019. On November 2, 2018, the Company and ConversionPoint Investments, LLC., an affiliate of CPT (the "Noteholder") entered into a Securities Purchase Agreement for up to $2 million pursuant to which the Company issued and sold a $1,000,000 principal amount 10% senior unsecured subordinated convertible promissory note ("the Subordinated Promissory Note") to the Noteholder which we are using for working capital. The Subordinated Promissory Note, which bears interest at the rate of 10% per annum, and the principal and accrued interest is due on November 2, 2019. The maturity date of the Subordinated Promissory Note is subject to acceleration in the event (i) the Closing (as that term is defined in the Merger Agreement) occur pursuant to the Merger Agreement, in which event the maturity date is accelerated to the fifth day after the Closing Date (as that term is defined in the Merger Agreement) and (ii) immediately upon an Event of Default (as that term is defined in the Subordinated Promissory Note). The Company has the right to prepay the amounts due under the Subordinated Promissory Note at any time, upon 15 days prior written notice to the Noteholder, subject to the term of the note and Noteholder consent. The Company’s obligations under the Subordinated Promissory Note are unsecured and subordinate to its obligations to Western Alliance Bank, the Company’s secured lender. In the event Merger Agreement is terminated, and providing that the shares issuable upon the possible conversion of the Subordinated Promissory Note have been approved for listing on the NYSE American, the Noteholder may, upon 15 days written notice to the Company, elect to convert all or any portion of the principal and accrued and unpaid interest due under the Subordinated Promissory Note into shares of the Company’s common stock at a conversion price of $0.44 per share, or $0.35 per share if the Merger Agreement is terminated for any reason other than in connection with a Superior Proposal (as defined in the Merger Agreement). The conversion prices are subject to proportional adjustment in the event of stock split or adjustments. The Subordinated Promissory Note also contains a provision limiting the Company’s ability to issue any shares of our common stock upon any voluntary conversion by the Noteholder which, when aggregated with all shares of its common stock issued pursuant to a conversion of the Subordinated Promissory Note, would exceed 19.99% of our issued and outstanding shares of common stock immediately preceding the issuance of the note without first obtaining stockholder approval in accordance with the rules of the NYSE American. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of presentation | The consolidated financial statements presented are for Inuvo, Inc. and its consolidated subsidiaries. The accompanying unaudited consolidated financial statements have been prepared based upon SEC rules that permit reduced disclosure for interim periods. Certain information and footnote disclosures have been condensed or omitted in accordance with those rules and regulations. The accompanying consolidated balance sheet as of December 31, 2017, was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States ("GAAP"). In our opinion, these consolidated financial statements reflect all adjustments that are necessary for a fair presentation of results of operations and financial condition for the interim periods shown including normal recurring accruals and other items. The results for the interim periods are not necessarily indicative of results for the full year. |
Use of estimates | The preparation of financial statements, in accordance with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, net revenues and expenses and disclosure of contingent assets and liabilities. The estimates and assumptions used in the accompanying consolidated financial statements are based upon management’s regular evaluation of the relevant facts and circumstances as of the date of the consolidated financial statements. We regularly evaluate estimates and assumptions related to allowances for doubtful accounts, accrued sales reserve, goodwill and purchased intangible asset valuations, lives of intangible assets, deferred income tax asset valuation allowances and stock compensation. Actual results may differ from the estimates and assumptions used in preparing the accompanying consolidated financial statements, and such differences could be material. |
Revenue Recognition | In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (Topic 606) "Revenue from contracts with Customers." Topic 606 supersedes the revenue recognition requirements in Topic 605 “Revenue Recognition” (Topic 605) and requires entities to recognize revenue when control of the promised goods or services is transferred to customers at an amount |
Recent accounting pronouncements | In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This standard will require all leases with durations greater than twelve months to be recognized on the balance sheet and is effective for interim and annual reporting periods beginning after December 15, 2018, although early adoption is permitted. We believe adoption of this standard will have an impact on our consolidated balance sheets. Although we have not completed our assessment, we do not expect the adoption to change the recognition, measurement or presentation of lease expenses within the results of operations. |
Organization and Business (Tabl
Organization and Business (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Customer Concentration | We generated the majority of our revenue from two Demand side customers, Yahoo! and Google as noted below: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2018 2017 2018 2017 Yahoo! 75.6% 62.1 % 72.9 % 68.5 % Google 8.5% 8.9 % 9.0 % 10.8 % Total 84.1% 71.0 % 81.9 % 79.3 % |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Revenue from Products and Services | The following table presents our revenue disaggregated by channel: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2018 2017 2018 2017 Mobile $ 12,532,579 $ 12,899,583 $ 39,800,781 $ 33,241,487 Desktop 4,014,356 7,202,772 15,671,684 21,790,230 Other 259,235 209,147 842,541 766,828 Total $ 16,806,170 $ 20,311,502 $ 56,315,006 $ 55,798,545 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Property, Plant and Equipment [Abstract] | |
Net Carrying Value of Property and Equipment | The net carrying value of property and equipment was as follows as of: September 30, 2018 December 31, 2017 Furniture and fixtures $ 293,152 $ 288,536 Equipment 1,525,057 1,509,464 Capitalized internal use and purchased software 8,809,333 7,582,181 Leasehold improvements 421,016 455,850 Subtotal 11,048,558 9,836,031 Less: accumulated depreciation and amortization (8,787,591) (7,529,752) Total $ 2,260,967 $ 2,306,279 |
Other Intangible Assets and G_2
Other Intangible Assets and Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets from Continuing Operations | The following is a schedule of intangible assets as of September 30, 2018: Term Carrying Value Accumulated Amortization Net Carrying Value Year-to-date Amortization Customer list, Google 20 years $ 8,820,000 $ (2,903,250) $ 5,916,750 $ 330,750 Technology 5 years 3,600,000 (1,200,000) 2,400,000 540,000 Customer list, all other 10 years 1,610,000 (1,059,943) 550,057 120,753 Customer relationships 20 years 570,000 (47,500) 522,500 21,375 Trade names, web properties (1) - 390,000 — 390,000 — Brand 1 year 121,000 (121,000) — 10,083 Non-competition agreements 1 year 69,000 (69,000) — 5,750 Intangible assets classified as long-term $ 15,180,000 $ (5,400,693) $ 9,779,307 $ 1,028,711 Goodwill, total - $ 9,853,342 $ — $ 9,853,342 $ — |
Schedule of Amortization Expense | Amortization expense over the next five years and thereafter is as follows: 2018 $ 337,626 2019 1,350,504 2020 1,350,504 2021 1,350,504 2022 556,294 Thereafter 4,443,875 Total $ 9,389,307 |
Revolving Credit Line (Tables)
Revolving Credit Line (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Summary of revolving credit line | The following table summarizes our revolving credit line balances as of: September 30, 2018 December 31, 2017 Revolving credit line - 6.25 percent at September 30, 2018 (prime plus 1.0 percent), due October 20, 2018 $ 4,825,000 $ 4,900,000 Total $ 4,825,000 $ 4,900,000 |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses and other Current Liabilities | The accrued expenses and other current liabilities consist of the following as of: September 30, 2018 December 31, 2017 Accrued marketing costs (TAC) $ 1,654,053 $ 1,107,404 Accrued expenses and other 315,524 624,688 Capital leases, current portion 204,430 209,940 Accrued payroll and commission liabilities 184,405 867,634 Accrued sales allowance 50,000 50,000 Arkansas grant reserve 25,000 2,245 Accrued taxes 23,419 25,905 Total $ 2,456,831 $ 2,887,816 |
Other Long-Term Liabilities (Ta
Other Long-Term Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of Other Long-Term Liabilities | Other long-term liabilities consist of the following as of: September 30, 2018 December 31, 2017 Capital leases, less current portion $ 128,329 $ 281,470 Deferred rent 108,868 131,493 Accrued taxes, less current portion 13,762 13,762 Total $ 250,959 $ 426,725 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Stock Grants Outstanding | The following table summarizes the stock grants outstanding under our 2005 Long-Term Incentive Plan ("2005 LTIP"), the 2010 ECP and the 2017 ECP as of September 30, 2018: Options Outstanding RSUs Outstanding Options and RSUs Exercised Available Shares Total 2017 ECP — 733,500 41,664 1,374,836 2,150,000 2010 ECP 250,498 910,449 3,380,919 290,152 4,832,018 2005 LTIP (*) 13,748 — 950,085 — 963,833 Total 264,246 1,643,949 4,372,668 1,664,988 7,945,851 (*) Expired June 2015 |
Schedule of Stock Option Award Activity | The following table summarizes the activities of stock option awards under the 2005 LTIP and the 2010 ECP as of September 30, 2018: Shares Subject to Options Outstanding Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (in years) Aggregate Intrinsic Value Balance as of December 31, 2017 264,246 $ 2.84 2.7 $ 2,019 Stock options exercised — $ — — — Balance as of September 30, 2018 264,246 $ 2.84 2.7 $ 2,019 Stock options exercisable as of September 30, 2018 264,246 $ 2.84 2.7 $ 2,019 |
Schedule of Nonvested Restricted Stock Units Activity | The following table summarizes the activities for our unvested RSUs for the nine months ended September 30, 2018: Unvested RSUs Number of Shares Weighted Average Grant Date Fair Value Unvested as of December 31, 2017 1,071,538 $ 1.84 Granted 1,664,266 $ 0.76 Vested 641,843 $ 2.26 Forfeited 450,012 $ 1.05 Unvested as of September 30, 2018 1,643,949 $ 0.80 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Leases [Abstract] | |
Schedule of Minimum Future Lease Payments of Operating Leases | Minimum future lease payments under non-cancelable operating leases as of September 30, 2018 are: 2018 $ 118,870 2019 477,319 2020 405,606 2021 242,558 2022 163,284 Total $ 1,407,637 |
Schedule of Capital Lease Obligations and Future Minimum Lease Payments | Capital lease obligations and future minimum lease payments under non-cancelable capital leases as of September 30, 2018 are: Lease Payments 2018 $ 59,527 2019 $ 213,685 2020 $ 82,404 Total payments under capital lease obligations $ 355,616 Less amount representing interest (22,857) Present value of capital lease obligations 332,759 Current portion of capital lease obligations (204,430) Capital lease obligations, net of current portion $ 128,329 |
Schedule of Assets Under Capital Leases | Cost and related accumulated depreciation as of: September 30, 2018 December 31, 2017 Equipment $ 707,264 $ 707,264 Less accumulated depreciation (393,806) (242,169) Equipment, net $ 313,458 $ 465,095 |
Asset Acquisition 2017 (Tables)
Asset Acquisition 2017 (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions | Total consideration paid in common stock (with marketability discount applied) $ 4,459,244 Fair value of assets acquired: Accounts receivable, net (2,292,485) Prepaid expenses and other current assets (236,163) Property and equipment, net (119,101) Goodwill (4,013,034) Intangible assets (4,360,000) Fair value of liabilities assumed: Accounts payable $ 3,579,787 Accrued expenses and other current liabilities 1,152,789 Other long-term liabilities 49,149 Debt 2,015,577 Cash received in acquisition $ 235,763 |
Organization and Business (Deta
Organization and Business (Details) $ / shares in Units, machine_profile in Millions | Nov. 02, 2018USD ($)director | May 31, 2018USD ($)$ / sharesshares | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)patentclientmachine_profile | Sep. 30, 2017USD ($) | Dec. 31, 2017 |
Debt Instrument [Line Items] | |||||||
Number of machine profiles in database | machine_profile | 500 | ||||||
Number of clients who collectively manage US digital advertising budgets | client | 3 | ||||||
Percentage of all US digital advertising budgets managed by group of clients | 50.00% | ||||||
Number of issued patents | patent | 15 | ||||||
Number of pending patents | patent | 8 | ||||||
Net proceeds | $ 2,100,000 | $ 2,000,583 | $ 0 | ||||
Change in revenues from prior period | (17.30%) | ||||||
Net loss | $ 1,441,650 | $ 986,171 | $ 3,682,371 | 4,061,596 | |||
Public Offering | |||||||
Debt Instrument [Line Items] | |||||||
Number of shares issued (in shares) | shares | 2,860,000 | ||||||
Price per share (in usd per share) | $ / shares | $ 0.70 | ||||||
Over-Allotment Option | |||||||
Debt Instrument [Line Items] | |||||||
Number of shares issued (in shares) | shares | 429,000 | ||||||
Shelf Registration Statement | |||||||
Debt Instrument [Line Items] | |||||||
Shares authorized for sale | $ 15,000,000 | $ 15,000,000 | |||||
Sale of stock | $ 2,300,000 | ||||||
Accounts Receivable | Customer Concentration Risk | Yahoo! and Google | |||||||
Debt Instrument [Line Items] | |||||||
Percentage of concentration risk (as percent) | 70.00% | ||||||
Accounts Receivable | Customer Concentration Risk | Yahoo! and OpenX | |||||||
Debt Instrument [Line Items] | |||||||
Percentage of concentration risk (as percent) | 71.30% | ||||||
Subsequent Event | |||||||
Debt Instrument [Line Items] | |||||||
Number of directors who provided funding | director | 4 | ||||||
Subsequent Event | Funding From Directors | |||||||
Debt Instrument [Line Items] | |||||||
Related party transaction, amount | $ 250,000 | ||||||
Director | Subsequent Event | Funding From Directors | |||||||
Debt Instrument [Line Items] | |||||||
Related party transaction, amount | $ 62,500 |
Organization and Business - Cus
Organization and Business - Customer Concentration (Details) - Customer Concentration Risk - Net Revenue | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Yahoo! and Google | ||||
Concentration Risk [Line Items] | ||||
Percentage of concentration risk (as percent) | 84.10% | 71.00% | 81.90% | 79.30% |
Yahoo! | ||||
Concentration Risk [Line Items] | ||||
Percentage of concentration risk (as percent) | 75.60% | 62.10% | 72.90% | 68.50% |
Concentration Risk [Line Items] | ||||
Percentage of concentration risk (as percent) | 8.50% | 8.90% | 9.00% | 10.80% |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Disaggregation of Revenue [Line Items] | ||||
Net revenue | $ 16,806,170 | $ 20,311,502 | $ 56,315,006 | $ 55,798,545 |
Mobile | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenue | 12,532,579 | 12,899,583 | 39,800,781 | 33,241,487 |
Desktop | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenue | 4,014,356 | 7,202,772 | 15,671,684 | 21,790,230 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net revenue | $ 259,235 | $ 209,147 | $ 842,541 | $ 766,828 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | $ 11,048,558 | $ 11,048,558 | $ 9,836,031 | ||
Less: accumulated depreciation and amortization | (8,787,591) | (8,787,591) | (7,529,752) | ||
Total | 2,260,967 | 2,260,967 | 2,306,279 | ||
Depreciation expense | 457,272 | $ 406,014 | 1,343,247 | $ 1,077,143 | |
Furniture and fixtures | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | 293,152 | 293,152 | 288,536 | ||
Equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | 1,525,057 | 1,525,057 | 1,509,464 | ||
Capitalized internal use and purchased software | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | 8,809,333 | 8,809,333 | 7,582,181 | ||
Leasehold improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant and equipment, gross | $ 421,016 | $ 421,016 | $ 455,850 |
Other Intangible Assets and G_3
Other Intangible Assets and Goodwill - Schedule of Goodwill and Intangible Assets (Details) - USD ($) | 9 Months Ended | ||
Sep. 30, 2018 | Dec. 31, 2017 | ||
Schedule of Finite-Lived Intangible Assets and Goodwill [Line Items] | |||
Total intangible assets | $ 9,389,307 | ||
Year-to-date Amortization | 1,028,711 | ||
Intangible assets classified as long-term | |||
Intangible assets classified as long-term, Carrying Value | 15,180,000 | ||
Intangible assets classified as long-term, Accumulated Amortization | (5,400,693) | ||
Net Carrying Value | 9,779,307 | $ 10,808,018 | |
Goodwill, Impaired, Accumulated Impairment Loss | |||
Carrying Value | 9,853,342 | ||
Net Carrying Value | 9,853,342 | $ 9,853,342 | |
Trade names, web properties | |||
Schedule of Finite-Lived Intangible Assets and Goodwill [Line Items] | |||
Carrying value, indefinite-lived | [1] | 390,000 | |
Net carrying value, indefinite-lived | [1] | $ 390,000 | |
Customer list, Google | |||
Schedule of Finite-Lived Intangible Assets and Goodwill [Line Items] | |||
Term | 20 years | ||
Carrying Value | $ 8,820,000 | ||
Accumulated Amortization | (2,903,250) | ||
Total intangible assets | 5,916,750 | ||
Year-to-date Amortization | $ 330,750 | ||
Technology | |||
Schedule of Finite-Lived Intangible Assets and Goodwill [Line Items] | |||
Term | 5 years | ||
Carrying Value | $ 3,600,000 | ||
Accumulated Amortization | (1,200,000) | ||
Total intangible assets | 2,400,000 | ||
Year-to-date Amortization | $ 540,000 | ||
Customer list, all other | |||
Schedule of Finite-Lived Intangible Assets and Goodwill [Line Items] | |||
Term | 10 years | ||
Carrying Value | $ 1,610,000 | ||
Accumulated Amortization | (1,059,943) | ||
Total intangible assets | 550,057 | ||
Year-to-date Amortization | $ 120,753 | ||
Customer relationships | |||
Schedule of Finite-Lived Intangible Assets and Goodwill [Line Items] | |||
Term | 20 years | ||
Carrying Value | $ 570,000 | ||
Accumulated Amortization | (47,500) | ||
Total intangible assets | 522,500 | ||
Year-to-date Amortization | $ 21,375 | ||
Brand | |||
Schedule of Finite-Lived Intangible Assets and Goodwill [Line Items] | |||
Term | 1 year | ||
Carrying Value | $ 121,000 | ||
Accumulated Amortization | (121,000) | ||
Total intangible assets | 0 | ||
Year-to-date Amortization | $ 10,083 | ||
Non-competition agreements | |||
Schedule of Finite-Lived Intangible Assets and Goodwill [Line Items] | |||
Term | 1 year | ||
Carrying Value | $ 69,000 | ||
Accumulated Amortization | (69,000) | ||
Total intangible assets | 0 | ||
Year-to-date Amortization | $ 5,750 | ||
[1] | The trade names related to our web properties have an indefinite life, and as such are not amortized. |
Other Intangible Assets and G_4
Other Intangible Assets and Goodwill - Amortization Expense (Details) | Sep. 30, 2018USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2,018 | $ 337,626 |
2,019 | 1,350,504 |
2,020 | 1,350,504 |
2,021 | 1,350,504 |
2,022 | 556,294 |
Thereafter | 4,443,875 |
Total intangible assets | $ 9,389,307 |
Revolving Credit Line - Schedul
Revolving Credit Line - Schedule of Notes Payable (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||
Long-term Debt, Total | $ 4,825,000 | $ 4,900,000 |
Line of Credit | Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Revolving credit line - 6.25 percent at September 30, 2018 (prime plus 1.0 percent), due October 20, 2018 | $ 4,825,000 | $ 4,900,000 |
Stated interest rate | 6.25% | |
Line of Credit | Revolving Credit Facility | Prime Rate | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 1.00% |
Revolving Credit Line - Narrati
Revolving Credit Line - Narrative (Details) - USD ($) | Oct. 11, 2018 | Apr. 18, 2018 | Sep. 30, 2018 | Dec. 31, 2017 |
Debt Instrument [Line Items] | ||||
Remaining borrowing capacity | $ 0 | |||
Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Balance of revolving line of credit | $ 4,825,000 | $ 4,900,000 | ||
Tenth Business Financing Modification Agreement With Western Alliance Bank | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Change in finance charge, outstanding advances | 0.01% | |||
Bridge Bank – Revolving Credit Line - March 1, 2012 | Bridge Bank, N.A. | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, maximum borrowing capacity | $ 10,000,000 | |||
Debt instrument, allowable borrowings, percentage of eligible accounts receivable (as percent) | 85.00% | |||
Period for eligible accounts receivable | 90 days | |||
Period From February 1, 2018 Through November 30, 2018 | Tenth Business Financing Modification Agreement With Western Alliance Bank | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Quick ratio (not less than) | 0.60 | |||
Period From December 31, 2018 And After | Tenth Business Financing Modification Agreement With Western Alliance Bank | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Quick ratio (not less than) | 0.70 | |||
Quarter Ending March 31, 2018 | Tenth Business Financing Modification Agreement With Western Alliance Bank | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Maximum decline in Adjusted EBITDA from projected amount | $ 18,000 | |||
Quarter ending June 30, 2018 | Tenth Business Financing Modification Agreement With Western Alliance Bank | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Maximum decline in Adjusted EBITDA from projected amount | 57,000 | |||
Quarter Ending September 30, 2018 | Tenth Business Financing Modification Agreement With Western Alliance Bank | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Maximum decline in Adjusted EBITDA from projected amount | 191,000 | |||
Quarter Ending December 31, 2018 | Tenth Business Financing Modification Agreement With Western Alliance Bank | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Maximum decline in Adjusted EBITDA from projected amount | $ 496,000 | |||
Period From January 1, 2019 and After | Tenth Business Financing Modification Agreement With Western Alliance Bank | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Maximum percentage of decline in revenue from projected amount (as percent) | 25.00% | |||
Prime Rate | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 1.00% | |||
Subsequent Event | Amended and Restated Financing Agreement | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Eligible invoiced receivables, advance rate | 85.00% | |||
Facility fee | $ 11,765 | |||
Facility fee percentage | 0.25% | |||
Monthly maintenance fee | 0.125% | |||
Fee in lieu of warrant | $ 30,000 | |||
Fee due upon termination | 75,000 | |||
Subsequent Event | Amended And Restated Financing Agreement Uninvoiced Eligible Invoices | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Eligible uninvoiced receivables, sub-limit | $ 2,500,000 | |||
Eligible uninvoiced receivables, advance rate | 75.00% | |||
Subsequent Event | Prime Rate | Amended and Restated Financing Agreement | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 1.00% | |||
Subsequent Event | Prime Rate | Amended And Restated Financing Agreement Uninvoiced Eligible Invoices | Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 2.00% |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Payables and Accruals [Abstract] | ||
Accrued marketing costs (TAC) | $ 1,654,053 | $ 1,107,404 |
Accrued expenses and other | 315,524 | 624,688 |
Capital leases, current portion | 204,430 | 209,940 |
Accrued payroll and commission liabilities | 184,405 | 867,634 |
Accrued sales allowance | 50,000 | 50,000 |
Arkansas grant reserve | 25,000 | 2,245 |
Accrued taxes | 23,419 | 25,905 |
Total | $ 2,456,831 | $ 2,887,816 |
Other Long-Term Liabilities - C
Other Long-Term Liabilities - Components of Other Long-Term Liabilities (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Other Liabilities Disclosure [Abstract] | ||
Capital leases, less current portion | $ 128,329 | $ 281,470 |
Deferred rent | 108,868 | 131,493 |
Accrued taxes, less current portion | 13,762 | 13,762 |
Total | $ 250,959 | $ 426,725 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Income Tax Disclosure [Abstract] | ||
Deferred tax liability | $ 2,331,900 | $ 2,331,900 |
Deferred tax asset | $ 32,503,735 | $ 32,503,735 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||||
Option and restricted stock unit vesting period (up to) | 3 years | |||
Stock based compensation | $ 159,799 | $ 336,913 | $ 827,595 | $ 923,072 |
Compensation cost related to non vested awards not yet recognized | $ 1,138,696 | $ 1,138,696 | ||
Average remaining expense recognition period | 1 year 8 months 12 days |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Grants (Details) - shares | Sep. 30, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options Outstanding (in shares) | 264,246 | 264,246 | |
RSUs Outstanding (in shares) | 1,643,949 | ||
Options and RSUs Exercised (in shares) | 4,372,668 | ||
Available Shares (in shares) | 1,664,988 | ||
Total (in shares) | 7,945,851 | ||
2017 ECP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options Outstanding (in shares) | 0 | ||
RSUs Outstanding (in shares) | 733,500 | ||
Options and RSUs Exercised (in shares) | 41,664 | ||
Available Shares (in shares) | 1,374,836 | ||
Total (in shares) | 2,150,000 | ||
2010 ECP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options Outstanding (in shares) | 250,498 | ||
RSUs Outstanding (in shares) | 910,449 | ||
Options and RSUs Exercised (in shares) | 3,380,919 | ||
Available Shares (in shares) | 290,152 | ||
Total (in shares) | 4,832,018 | ||
2005 LTIP | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options Outstanding (in shares) | [1] | 13,748 | |
RSUs Outstanding (in shares) | [1] | 0 | |
Options and RSUs Exercised (in shares) | [1] | 950,085 | |
Available Shares (in shares) | [1] | 0 | |
Total (in shares) | [1] | 963,833 | |
[1] | Expired June 2015 |
Stock-Based Compensation - Sc_2
Stock-Based Compensation - Schedule of Outstanding Options (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Beginning options outstanding (in shares) | 264,246 | |
Stock options exercised (in shares) | 0 | |
Ending options outstanding (in shares) | 264,246 | 264,246 |
Options exercisable (in shares) | 264,246 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Beginning balance, weighted average exercise price (in usd per share) | $ 2.84 | |
Stock options exercised, weighted average exercise price (in usd per share) | 0 | |
Ending balance, weighted average exercise price (in usd per share) | 2.84 | $ 2.84 |
Options exercisable, weighted average exercise price (in usd per share) | $ 2.84 | |
Options outstanding, weighted average remaining contractual term | 2 years 8 months 12 days | 2 years 8 months 12 days |
Options exercisable, weighted average remaining contractual term | 2 years 8 months 12 days | |
Options outstanding, aggregate intrinsic value | $ 2,019 | $ 2,019 |
Options exercisable, aggregate intrinsic value | $ 2,019 |
Stock-Based Compensation - Sc_3
Stock-Based Compensation - Schedule of Unvested RSU (Details) | 9 Months Ended |
Sep. 30, 2018$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
RSUs unvested ending (in shares) | 1,643,949 |
Restricted Stock Units | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
RSUs unvested beginning (in shares) | 1,071,538 |
Grants in period (in shares) | 1,664,266 |
Vested in period (in shares) | 641,843 |
Forfeited in period (in shares) | 450,012 |
RSUs unvested ending (in shares) | 1,643,949 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Unvested, weighted average grant date fair value (in usd per share) | $ / shares | $ 1.84 |
Grants in period, weighted average grant date fair value (in usd per share) | $ / shares | 0.76 |
Vested in period, weighted average grant date fair value (in usd per share) | $ / shares | 2.26 |
Forfeited in period, weighted average grant date fair value (in usd per share) | $ / shares | 1.05 |
Unvested, weighted average grant date fair value (in usd per share) | $ / shares | $ 0.80 |
Discontinued Operations (Detail
Discontinued Operations (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | ||||
Net income (loss) from discontinued operations | $ 0 | $ 0 | $ 0 | $ (1,109) |
Leases (Details)
Leases (Details) | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Jul. 31, 2017USD ($)ft² | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($) | Jun. 30, 2017USD ($)ft² | Feb. 28, 2017USD ($) | Apr. 30, 2015USD ($)ft² | |
Leases [Abstract] | |||||||||
Rent expense, operating leases (credits) | $ 101,767 | $ 109,701 | $ 309,596 | $ 346,717 | |||||
Lease Payments | |||||||||
2,018 | 118,870 | 118,870 | |||||||
2,019 | 477,319 | 477,319 | |||||||
2,020 | 405,606 | 405,606 | |||||||
2,021 | 242,558 | 242,558 | |||||||
2,022 | 163,284 | 163,284 | |||||||
Total | 1,407,637 | 1,407,637 | |||||||
Operating Leased Assets [Line Items] | |||||||||
Number of square feet | ft² | 4,801 | ||||||||
Capital leases depreciation expense | 47,277 | $ 107,531 | 151,637 | $ 66,245 | |||||
Capital Leases, Future Minimum Payments, Net Present Value [Abstract] | |||||||||
2,018 | 59,527 | 59,527 | |||||||
2,019 | 213,685 | 213,685 | |||||||
2,020 | 82,404 | 82,404 | |||||||
Total payments under capital lease obligations | 355,616 | 355,616 | |||||||
Less amount representing interest | (22,857) | (22,857) | |||||||
Present value of capital lease obligations | 332,759 | 332,759 | |||||||
Current portion of capital lease obligations | (204,430) | (204,430) | $ (209,940) | ||||||
Capital lease obligations, net of current portion | $ 128,329 | $ 128,329 | 281,470 | ||||||
NetSeer | |||||||||
Operating Leased Assets [Line Items] | |||||||||
Number of square feet | ft² | 15,717 | ||||||||
Operating lease, payments | $ 95,000 | ||||||||
Office Space | |||||||||
Operating Leased Assets [Line Items] | |||||||||
Lease term | 5 years | 5 years | |||||||
Number of square feet | ft² | 12,245 | ||||||||
Operating leases, future minimum payments due, next twelve months | $ 216,000 | $ 171,000 | |||||||
Annual lease payment increase, percentage | 3.00% | 2.00% | |||||||
Computer equipment | |||||||||
Operating Leased Assets [Line Items] | |||||||||
Lease term | 3 years | ||||||||
Operating leases, future minimum payments due, next twelve months | $ 173,000 | ||||||||
Capital leases, payments | $ 516,000 | ||||||||
Equipment | |||||||||
Operating Leased Assets [Line Items] | |||||||||
Lease term | 3 years | 3 years | |||||||
Capital Leases, Balance Sheet, Assets by Major Class, Net [Abstract] | |||||||||
Equipment | $ 707,264 | $ 707,264 | 707,264 | ||||||
Less accumulated depreciation | (393,806) | (393,806) | (242,169) | ||||||
Equipment, net | $ 313,458 | $ 313,458 | $ 465,095 | ||||||
Assets Held under Capital Leases | NetSeer | |||||||||
Operating Leased Assets [Line Items] | |||||||||
Capital lease acquired | $ 88,575 |
Asset Acquisition 2017 - Narrat
Asset Acquisition 2017 - Narrative (Details) - USD ($) | Feb. 06, 2017 | Sep. 30, 2017 | Sep. 30, 2018 | Dec. 31, 2017 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 9,853,342 | $ 9,853,342 | ||
NetSeer | ||||
Business Acquisition [Line Items] | ||||
Shares issued in asset purchase agreement (in shares) | 3,529,000 | |||
Shares deposited into escrow (in shares) | 529,350 | |||
Goodwill | $ 4,013,034 | |||
Accounts receivable | 2,292,485 | |||
Intangible assets | 4,360,000 | |||
Netseer revenue | $ 10,000,000 | |||
NetSeer | Selling, General and Administrative Expenses | ||||
Business Acquisition [Line Items] | ||||
Acquisition related costs | $ 350,000 |
Asset Acquisition 2017 - Schedu
Asset Acquisition 2017 - Schedule of Assets and Liabilities Acquired (Details) - USD ($) | Feb. 06, 2017 | Sep. 30, 2018 | Dec. 31, 2017 |
Fair value of assets acquired: | |||
Goodwill | $ (9,853,342) | $ (9,853,342) | |
NetSeer Asset Acquisition | |||
Business Acquisition [Line Items] | |||
Total consideration paid in common stock (with marketability discount applied) | $ 4,459,244 | ||
Fair value of assets acquired: | |||
Accounts receivable, net | (2,292,485) | ||
Prepaid expenses and other current assets | (236,163) | ||
Property and equipment, net | (119,101) | ||
Goodwill | (4,013,034) | ||
Intangible assets | (4,360,000) | ||
Fair value of liabilities assumed: | |||
Accounts payable | 3,579,787 | ||
Accrued expenses and other current liabilities | 1,152,789 | ||
Other long-term liabilities | 49,149 | ||
Debt | 2,015,577 | ||
Cash received in acquisition | $ 235,763 |
Related Party Transactions (Det
Related Party Transactions (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)director | Sep. 30, 2017USD ($) | |
Related Party Transactions [Abstract] | ||||
Revenue from related party | $ | $ 10,500 | $ 27,576 | $ 31,500 | $ 91,718 |
Number of directors partially owning First Orion Corp. | director | 2 |
Subsequent Events (Details)
Subsequent Events (Details) | Nov. 02, 2018USD ($)$ / shares | Dec. 31, 2018USD ($) |
Merger with ConversionPoint Technologies | Subsequent Event | ||
Subsequent Event [Line Items] | ||
Merger Agreement, consideration price per share | $ / shares | $ 0.45 | |
Merger Agreement, consideration shares per share | 0.18877 | |
Termination fee | $ 2,800,000 | |
Line of Credit | Subsequent Event | ||
Subsequent Event [Line Items] | ||
Stated interest rate | 10.00% | |
Funding From Directors | Subsequent Event | ||
Subsequent Event [Line Items] | ||
Stated interest rate | 10.00% | |
Related party transaction, amount | $ 250,000 | |
Director | Funding From Directors | Subsequent Event | ||
Subsequent Event [Line Items] | ||
Related party transaction, amount | 62,500 | |
ConversionPoint Technologies Inc. | Line of Credit | Subsequent Event | ||
Subsequent Event [Line Items] | ||
Line of credit facility, maximum borrowing capacity | 2,000,000 | |
Proceeds from lines of credit | 1,000,000 | |
ConversionPoint Holdings, Inc. | Subsequent Event | ||
Subsequent Event [Line Items] | ||
Face amount | $ 36,000,000 | |
ConversionPoint Holdings, Inc. | Merger with ConversionPoint Technologies | Subsequent Event | ||
Subsequent Event [Line Items] | ||
Merger Agreement, consideration shares per share | 0.9840 | |
Merger Agreement, consideration shares per option | 0.2370 | |
ConversionPoint Holdings, Inc. | Forecast | Merger with ConversionPoint Technologies | ||
Subsequent Event [Line Items] | ||
Termination fee | $ 2,800,000 | |
Convertible Subordinated Debt | Subordinated Promissory Note | Subsequent Event | ||
Subsequent Event [Line Items] | ||
Conversion price | $ / shares | $ 0.44 | |
Shares pursuant to conversion to shares issued and outstanding, percentage | 0.1999 | |
Convertible Subordinated Debt | Subordinated Promissory Note, Merger Termination | Subsequent Event | ||
Subsequent Event [Line Items] | ||
Conversion price | $ / shares | $ 0.35 |