Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 25, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2020 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | VERO | ||
Entity Registrant Name | Venus Concept Inc. | ||
Entity Central Index Key | 0001409269 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Shell Company | false | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | true | ||
Entity Ex Transition Period | false | ||
Entity Common Stock, Shares Outstanding | 53,971,951 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Title of 12(b) Security | Common Stock, $0.0001 par value per share | ||
Security Exchange Name | NASDAQ | ||
Entity File Number | 001-38238 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 06-1681204 | ||
Entity Address, Address Line One | 235 Yorkland Blvd. | ||
Entity Address, Address Line Two | Suite 900 | ||
Entity Address, City or Town | Toronto | ||
Entity Address, State or Province | ON | ||
Entity Address, Postal Zip Code | M2J 4Y8 | ||
City Area Code | 877 | ||
Local Phone Number | 848-8430 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity Public Float | $ 49,700,811 | ||
ICFR Auditor Attestation Flag | false | ||
Documents Incorporated by Reference | Documents to be Incorporated by Reference Certain information required in Items 10, 11, 12, 13 and 14 of Part III of this Annual Report on Form 10-K (the "Annual Report") is incorporated by reference from our definitive Proxy Statement for our 2021 Annual Meeting of Stockholders (our "Proxy Statement") which will be filed with the Securities and Exchange Commission (the "SEC") within 120 days after the end of the fiscal year ended December 31, 2020. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 34,297 | $ 15,666 |
Restricted cash | 83 | 83 |
Accounts receivable, net of allowance of $18,490 and $10,494 as of December 31, 2020, and 2019 | 52,764 | 58,977 |
Inventories | 17,759 | 18,844 |
Deferred expenses | 59 | |
Prepaid expenses | 2,240 | 2,523 |
Advances to suppliers | 2,587 | 450 |
Other current assets | 5,674 | 3,101 |
Total current assets | 115,404 | 99,703 |
LONG-TERM ASSETS: | ||
Long-term receivables | 21,148 | 35,656 |
Deferred tax assets | 884 | 622 |
Severance pay funds | 685 | 710 |
Property and equipment, net | 3,539 | 4,648 |
Intangible assets | 18,865 | 22,338 |
Goodwill | 27,450 | |
Total long-term assets | 45,121 | 91,424 |
TOTAL ASSETS | 160,525 | 191,127 |
CURRENT LIABILITIES: | ||
Line of credit | 7,789 | |
Trade payables | 6,322 | 9,401 |
Accrued expenses and other current liabilities | 20,253 | 21,120 |
Income taxes payable | 1,132 | 2,172 |
Unearned interest income | 1,950 | 3,942 |
Warranty accrual | 1,106 | 1,254 |
Deferred revenues | 1,752 | 2,495 |
Total current liabilities | 32,515 | 48,173 |
LONG-TERM LIABILITIES: | ||
Long-term debt | 75,491 | 61,229 |
Government assistance loans | 4,110 | |
Income tax payable | 478 | |
Accrued severance pay | 755 | 827 |
Deferred tax liabilities | 811 | 1,017 |
Unearned interest income | 1,778 | 1,681 |
Warranty accrual | 533 | 723 |
Other long-term liabilities | 293 | 799 |
Total long-term liabilities | 84,249 | 66,276 |
TOTAL LIABILITIES | 116,764 | 114,449 |
Commitments and Contingencies (Note 9) | ||
STOCKHOLDERS’ EQUITY (Note 1): | ||
Common Stock, $0.0001 par value: 300,000,000 shares authorized as of December 31, 2020 and 2019; 53,551,126 and 28,686,116 issued and outstanding as of December 31, 2020 and 2019, respectively | 26 | 24 |
Additional paid-in capital (Note 1) | 201,598 | 149,840 |
Accumulated deficit | (157,392) | (75,686) |
TOTAL STOCKHOLDERS’ EQUITY | 44,232 | 74,178 |
Non-controlling interests | (471) | 2,500 |
Total equity | 43,761 | 76,678 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 160,525 | $ 191,127 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Statement Of Financial Position [Abstract] | ||
Accounts receivable, allowance | $ 18,490 | $ 10,494 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 53,551,126 | 28,686,116 |
Common stock, shares outstanding | 53,551,126 | 28,686,116 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Revenue | $ 78,014 | $ 110,406 |
Cost of goods sold | 26,623 | 33,753 |
Gross profit | 51,391 | 76,653 |
Operating expenses: | ||
Selling and marketing | 26,203 | 41,409 |
General and administrative | 57,882 | 57,488 |
Research and development | 7,754 | 8,034 |
Goodwill impairment | 27,450 | |
Total operating expenses | 119,289 | 106,931 |
Loss from operations | (67,898) | (30,278) |
Other expenses: | ||
Foreign exchange (gain) loss | (68) | 2,611 |
Finance expenses | 8,343 | 7,549 |
Loss on debt extinguishment | 2,938 | |
Loss on disposal of subsidiaries | 2,526 | |
Loss before income taxes | (81,637) | (40,438) |
Income tax expense | 1,181 | 1,857 |
Net loss | (82,818) | (42,295) |
Deemed dividend (Note 15) | 3,564 | |
Loss attributable to stockholders of the Company | (85,270) | (40,619) |
Loss attributable to non-controlling interest | $ (1,112) | $ (1,676) |
Net loss per share: | ||
Basic | $ (2.33) | $ (4.77) |
Diluted | $ (2.33) | $ (4.77) |
Weighted-average number of shares used in per share calculation: | ||
Basic | 36,626 | 8,517 |
Diluted | 36,626 | 8,517 |
Leases | ||
Revenue | $ 33,428 | $ 65,170 |
Cost of goods sold | 7,899 | 13,411 |
Products and Services | ||
Revenue | 44,586 | 45,236 |
Cost of goods sold | $ 18,724 | $ 20,342 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Statement Of Income And Comprehensive Income [Abstract] | ||
Net loss and comprehensive loss | $ (82,818) | $ (42,295) |
Deemed dividend (Note 15) | 3,564 | |
Loss attributable to stockholders of the Company | (85,270) | (40,619) |
Comprehensive loss attributable to non-controlling interest | (1,112) | (1,676) |
Comprehensive loss | $ (82,818) | $ (42,295) |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity - USD ($) $ in Thousands | Total | Series A Preferred Shares | Series B Preferred Shares | Series C Preferred Shares | Series C-1 Preferred Shares | Series D Preferred Shares | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Non-controlling Interest |
Beginning balance, value at Dec. 31, 2018 | $ 36,455 | $ 5 | $ 67,495 | $ (35,067) | $ 4,022 | |||||
Beginning balance, shares at Dec. 31, 2018 | 1,264,565 | 2,632,109 | 4,615,567 | 56,983 | 647,189 | 4,772,956 | ||||
Conversion of convertible preferred shares into common stock, shares | (1,264,565) | (2,632,109) | (4,615,567) | (56,983) | (647,189) | 9,216,413 | ||||
Exchange of common stock in connection with the Merger | 15,709 | 15,709 | ||||||||
Exchange of common stock in connection with the Merger, shares | 2,802,466 | |||||||||
Exchange of options and warrants in connection with the Merger | 121 | 121 | ||||||||
Conversion of convertible promissory notes into common stock | 36,958 | $ 8 | 36,950 | |||||||
Conversion of convertible promissory notes into common stock, shares | 4,074,565 | |||||||||
Concurrent Financing shares and warrants, net of costs | 26,501 | $ 11 | 26,490 | |||||||
Concurrent Financing shares and warrants, net of costs, shares | 7,483,980 | |||||||||
Equity issuance | 702 | 702 | ||||||||
Equity issuance, shares | 160,000 | |||||||||
Issuance of Solar 2019 Warrants | 137 | 137 | ||||||||
Net loss - the Company | (40,619) | (40,619) | ||||||||
Net loss- non-controlling interest | (1,676) | (1,676) | ||||||||
Acquisition of non-controlling interest | (123) | (277) | 154 | |||||||
Options exercised | 355 | 355 | ||||||||
Options exercised, shares | 175,736 | |||||||||
Stock-based compensation | 2,158 | 2,158 | ||||||||
Ending balance, value at Dec. 31, 2019 | 76,678 | $ 24 | 149,840 | (75,686) | 2,500 | |||||
Ending balance, shares at Dec. 31, 2019 | 28,686,116 | |||||||||
Equity issuance | 8,490 | 8,490 | ||||||||
Equity issuance, shares | 4,245,256 | |||||||||
2020 Private Placement shares and warrants, net of costs and beneficial conversion feature | 16,736 | 16,736 | ||||||||
2020 Private Placement shares and warrants, net of costs and beneficial conversion feature, shares | 660,000 | 2,300,000 | ||||||||
Conversion of Preferred Stock Series A | $ 1 | (1) | ||||||||
Conversion of Preferred Stock Series A, shares | (660,000) | 6,600,000 | ||||||||
December 2020 Offering common stock & warrants, net of costs | 20,476 | $ 1 | 20,475 | |||||||
December 2020 Public Offering shares and warrants, net of costs, Shares | 11,250,000 | |||||||||
Deemed dividends | 3,564 | 3,564 | ||||||||
Dividends from subsidiaries | (218) | (218) | ||||||||
Net loss - the Company | (81,706) | (81,706) | ||||||||
Net loss- non-controlling interest | (1,112) | (1,112) | ||||||||
Options exercised | $ 356 | 356 | ||||||||
Options exercised, shares | 469,754 | 469,754 | ||||||||
Disposal of subsidiary | $ (1,641) | (1,641) | ||||||||
Stock-based compensation | 2,138 | 2,138 | ||||||||
Ending balance, value at Dec. 31, 2020 | $ 43,761 | $ 26 | $ 201,598 | $ (157,392) | $ (471) | |||||
Ending balance, shares at Dec. 31, 2020 | 53,551,126 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (82,818) | $ (42,295) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Goodwill impairment | 27,450 | |
Depreciation and amortization | 4,804 | 2,040 |
Stock-based compensation | 2,138 | 2,158 |
Provision for bad debt | 15,212 | 9,991 |
Provision for inventory obsolescence | 610 | 1,439 |
Loss on debt extinguishment | 2,938 | |
Finance expenses | 6,091 | 402 |
Deferred tax benefit | (438) | (1,132) |
Interest on convertible promissory notes | 135 | 599 |
Change in fair value of earn-out liability | 291 | 533 |
Loss on sale of subsidiaries | 2,526 | |
Loss on disposal of property and equipment | 162 | |
Issuance of 2019 Solar warrants | 137 | |
Unrealized foreign exchange loss | (30) | (626) |
Changes in operating assets and liabilities: | ||
Accounts receivable short- and long-term | 93 | (21,093) |
Inventories | (1,020) | 6,430 |
Prepaid expenses | 233 | (855) |
Other current assets | (2,359) | 523 |
Other long-term assets | (162) | (154) |
Trade payables | (2,979) | (5,968) |
Accrued expenses and other current liabilities | 857 | 9,571 |
Severance payments | 25 | 81 |
Unearned interest income | (1,895) | 22 |
Other long-term liabilities | (514) | (1,398) |
Net cash used in operating activities | (28,650) | (39,595) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Cash, cash equivalents and restricted cash acquired in connection with the Merger | 7,409 | |
Proceeds from sale of property and equipment | 98 | |
Purchases of property and equipment | (291) | (1,123) |
Cash received from sale of subsidiary, net of cash relinquished | (2,101) | |
Net cash (used in) provided by investing activities | (2,392) | 6,384 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of MSLP loan, net of cash financing fees of $1,229 | 48,771 | |
(Repayment) Issuance of long-term debt | (43,649) | 9,740 |
Issuance of loan to Restoration Robotics, Inc. | (4,500) | |
(Repayment of) Drawdown of line-of-credit | (7,813) | 2,134 |
Issuance of convertible promissory notes | 29,050 | |
Payment under Solar loan and security agreement | (20,000) | |
Proceeds from government assistance loans | 4,110 | |
Proceeds from issuance of common stock, net of costs | 8,390 | |
Proceeds from December 2020 Public Offering, net of costs of $2,025 | 20,475 | |
Dividends from subsidiaries paid to non-controlling interest | (218) | |
Payment of earn-out liability | (799) | (828) |
Installment payments | (250) | (250) |
Proceeds from exercise of options | 356 | 355 |
Net cash provided by financing activities | 49,673 | 42,202 |
NET INCREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | 18,631 | 8,991 |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH — Beginning of year | 15,749 | 6,758 |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH — End of year | 34,380 | 15,749 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: | ||
Cash paid for income taxes | 941 | 1,087 |
Cash paid for interest | 1,470 | 6,166 |
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING INFORMATION: | ||
Beneficial conversion factor of preferred stock accreted as deemed dividend | 3,564 | |
Conversion of Series A convertible preferred stock | 660 | 36,958 |
Issuance of convertible promissory notes | 26,695 | |
Replacement of outstanding Madryn loan with convertible notes | 26,695 | |
Assets received from sale of subsidiaries | 2,918 | |
Issuance of shares to financial advisor | 702 | |
Fair value of net assets acquired in the Merger | 15,830 | |
Redemption of notes receivable as a part of purchase consideration in connection with the Merger | 4,558 | |
Acquisition of non-controlling interest | 123 | |
Concurrent Financing | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from Concurrent Financing and 2020 Private Placement, net of costs of $1,564 and $1,951 | $ 26,501 | |
Private Placement | ||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from Concurrent Financing and 2020 Private Placement, net of costs of $1,564 and $1,951 | $ 20,300 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash financing fees, net | $ 1,229 | |
Concurrent Financing | ||
Stock, issuance costs | 1,564 | $ 1,564 |
Private Placement | ||
Stock, issuance costs | 1,951 | |
IPO | ||
Stock, issuance costs | $ 2,025 |
Nature of Operations
Nature of Operations | 12 Months Ended |
Dec. 31, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Nature of Operations | Venus Concept Inc. is a global medical technology company that develops, commercializes, and sells minimally invasive and non-invasive medical aesthetic and hair restoration technologies and related services. The Company’s systems have been designed on cost-effective, proprietary and flexible platforms that enables it to expand beyond the aesthetic industry’s traditional markets of dermatology and plastic surgery, and into non-traditional markets, including family and general practitioners and aesthetic medical spas. The Company was incorporated in the state of Delaware on November 22, 2002. In these notes to the consolidated financial statements, the “Company” and “Venus Concept”, refer to Venus Concept Inc. and its subsidiaries on a consolidated basis. Going Concern The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business for the foreseeable future, and, as such, the consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue in existence. The Company has had recurring net operating losses and negative cash flows from operations. As of December 31, 2020 and December 31, 2019, the Company had an accumulated deficit of $157,392 and $75,686, respectively. The Company was in compliance with all required covenants as of December 31, 2020 and as of December 31, 2019. The Company’s recurring losses from operations and negative cash flows raise substantial doubt about the Company’s ability to continue as a going concern within 12 months from the date that the consolidated financial statements are issued. In addition, the COVID-19 pandemic has had a significant negative impact on the Company’s consolidated financial statements as of December 31, 2020 and for the year then ended, and management expects the pandemic to continue to have a negative impact in the foreseeable future, the extent of which is uncertain and largely subject to whether the severity of the pandemic worsens, or duration lengthens. In the event that the COVID-19 pandemic and the economic disruptions it has caused continue for an extended period of time the Company cannot assure that it will remain in compliance with the financial covenants in its credit facilities. In order to continue its operations, the Company must achieve profitable operations and/or obtain additional equity or debt financing. Until the Company achieves profitability, management plans to fund its operations and capital expenditures with cash on hand, borrowings and issuance of capital stock. In March 2020, the Company completed a private placement that raised net proceeds of $20,300, as described below. On June 16, 2020, the Company entered into the Equity Purchase Agreement with Lincoln Park, which provides that, upon the terms and subject to the conditions and limitations set forth therein, the Company may sell to Lincoln Park up to $31,000 of shares of its common stock from time to time over the two-year term of the agreement. Any shares of common stock sold to Lincoln Park will be sold at a purchase price that is based on the prevailing prices of the common stock at the time of each sale. During the year ended December 31, 2020, the Company raised net cash proceeds of $8,390 under the Equity Purchase Agreement as described below. In December 2020, the Company completed the December 2020 Public Offering that raised net proceeds of $20,476, as described below. Until the Company generates revenue at a level to support its cost structure, the Company expects to continue to incur substantial operating losses and net cash outflows from operating activities. Given the COVID-19 pandemic, the Company cannot anticipate the extent to which the current economic turmoil and financial market conditions will continue to adversely impact the Company’s business and the Company may need additional capital to fund its future operations and to access the capital markets sooner than planned. There can be no assurance that the Company will be successful in raising additional capital or that such capital, if available, will be on terms that are acceptable to the Company. If the Company is unable to raise sufficient additional capital, it may be compelled to reduce the scope of its operations and planned capital expenditures or sell certain assets, including intellectual property assets. These consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might result from the uncertainty. Such adjustments could be material. Merger of Venus Concept Inc. with Venus Concept Ltd. On November 7, 2019, the Company (formerly Restoration Robotics, Inc.), completed its business combination with Venus Concept Ltd., in accordance with the terms of the Agreement and Plan of Merger and Reorganization, dated as of March 15, 2019, as amended from time to time (the “Merger Agreement”), by and among the Company, Venus Concept Ltd. and Radiant Merger Sub Ltd., a company organized under the laws of Israel and a direct, wholly-owned subsidiary of the Company (“Merger Sub”). Under the Merger Agreement, Merger Sub merged with and into Venus Concept Ltd., with Venus Concept Ltd. surviving as a wholly owned subsidiary of the Company (the “Merger”). Following the completion of the Merger, the Company changed its corporate name to Venus Concept Inc., and the business conducted by Venus Concept Ltd. became the primary business conducted by the Company. At the effective time of the Merger, each outstanding ordinary and preferred share of Venus Concept Ltd., other than shares held by Venus Concept Ltd. as treasury stock or held by the Company or Merger Sub, were converted into the right to receive 8.6506 or Exchange Ratio, validly issued, fully paid and non-assessable shares of common stock, and each outstanding stock option and warrant issued and outstanding by Venus Concept Ltd. was assumed by Restoration Robotics, Inc. and converted into and became an option or warrant (as applicable) exercisable for shares of common stock with the number and exercise price adjusted by the Exchange Ratio. The Merger was accounted for as a reverse acquisition with Venus Concept Ltd. as the acquiring company for accounting purposes, and Restoration Robotics, Inc. as the legal acquirer. As a result, upon consummation of the Merger, the historical financial statements of Venus Concept Ltd. became the historical financial statements of Venus Concept Inc. The 2020 Private Placement On March 18, 2020, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with certain investors (collectively, the “Investors”) pursuant to which the Company issued and sold to the Investors an aggregate of 2,300,000 shares of common stock, par value $0.0001 per share, 660,000 shares of Series A Convertible Preferred Stock, par value $0.0001 per share (the “Series A Preferred Stock”), which are convertible into 6,600,000 shares of common stock upon receipt of stockholder approval, and warrants (the “2020 Private Placement Warrants”) to purchase up to 6,675,000 shares of common stock with an exercise price of $3.50 per share (the “2020 Private Placement”). The 2020 Private Placement Warrants have a five-year term and are exercisable beginning 181 days after their issue date. The 2020 Private Placement was completed on March 19, 2020. On June 16, 2020 the Company’s stockholders approved the issuance of 6,600,000 shares of common stock upon the conversion of the 660,000 shares of Series A Preferred Stock issued by the Company in connection with the 2020 Private Placement and all outstanding shares of Series A Preferred Stock were converted into 6,600,000 shares of common stock. The gross proceeds from the securities sold in the 2020 Private Placement was $22,250. The costs incurred with respect to the 2020 Private Placement totaled $1,950 and were recorded in the consolidated statements of stockholders’ equity. The accounting effects of the 2020 Private Placement transaction and subsequent conversion of Series A Preferred Stock are discussed in Note 15. Equity Purchase Agreement with Lincoln Park On June 16, 2020, the Company entered into the Equity Purchase Agreement with Lincoln Park, which provides that, upon the terms and subject to the conditions and limitations set forth therein, the Company may sell to Lincoln Park up to $31,000 of shares of its common stock, par value $0.0001 per share, pursuant to its shelf registration statement. The purchase price of shares of common stock related to a future sale will be based on the then prevailing market prices of such shares at the time of sales as described in the Equity Purchase Agreement. The aggregate number of shares that the Company can sell to Lincoln Park under the Equity Purchase Agreement may in no case exceed 7,763,411 As of December 31, 2020, the Company issued and sold to Lincoln Park 3,037,087 shares of its common stock at an average price of $2.97 per share, and 209,566 of these shares were issued to Lincoln Park as a commitment fee in connection with entering into the Equity Purchase Agreement (the “Commitment Shares”). The total value of the Commitment Shares of $620 together with the issuance costs of $123 were recorded as deferred issuance costs in the consolidated balance sheet. These costs will be amortized into consolidated statements of stockholders’ equity proportionally based on proceeds received during the period and the expected total proceeds to be raised over the term of the Equity Purchase Agreement. Gross proceeds from common stock issuances as of December 31 , 2020 were $9,010, which were then reduced by the amortization of deferred issuance costs of $520. Gross proceeds in the amount of $9,010 reduced by the value of the Commitment Shares of $620 were recorded in the consolidated statements of cash flows as net cash proceeds from issuance of common stock. December 2020 Public Offering On December 22, 2020, the Company issued and sold to the investors in the December 2020 Offering 11,250,000 shares of its common stock, par value $0.0001 per share, at a combined offering price to the public of $2.00 per share and warrants (“December 2020 Public Offering Warrants”) to purchase up to 5,625,000 shares of common stock with an exercise price of $2.50 per share. The December 2020 Offering Warrants have a five-year term and are exercisable immediately. Total gross proceeds were $22,500. Sale of subsidiaries In 2020, the Company made several strategic decisions to divest of underperforming direct sales offices and sold its share in several subsidiaries, located in Bulgaria, Indonesia, Italy, India, Russia, Singapore, Vietnam, and Kazakhstan. These disposals did not constitute a strategic shift that will have a major effect on the Company’s operations and financial results, and operating revenue of disposed subsidiaries did not exceed 15% of the Company’s total revenue, therefore the results of operations for disposed subsidiaries were not reported as discontinued operations under the guidance of Accounting Standards Codification (“ASC”) 205-20-45. The sale of subsidiaries resulted in loss of approximately $2,526 recognized in the consolidated statements of operations (Note 4). |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP). Principles of Consolidation The accompanying consolidated financial statements include the accounts of Venus Concept Inc. and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated on consolidation. Where the Company does not own 100% of its subsidiaries, it accounts for the partial ownership interest through non-controlling interest. 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 and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Significant estimates and assumptions made in the accompanying consolidated financial statements include, but are not limited to, the implicit interest rate used to record lease revenue, allowance for doubtful accounts, inventory valuation, stock-based compensation, warranty accrual, the valuation and measurement of deferred tax assets and liabilities, accrued severance pay, useful lives of property and equipment, earn-out liability, useful lives of intangible assets, impairment of long-lived assets and goodwill and valuation of acquired intangible assets and goodwill. The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could materially differ from those estimates. The Company assessed certain accounting matters that generally require consideration of forecasted financial information in context with the information reasonably available to the Company and the unknown future impacts of COVID-19 December 31 intangible and long-lived assets COVID-19 related December 31 Restatement of Comparative Amounts Venus Concept Ltd. previously classified the issuance of common stock and preferred stock as a credit to common stock. In accordance with U.S. GAAP, amounts issued in excess of par value are required to be accounted for in additional paid in capital (“APIC”). The error is a reclassification from common stock into APIC and has an overall immaterial impact on the consolidated statement of stockholders’ equity and consolidated balance sheet. Items previously reported have been reclassified to conform to U.S. GAAP and the reclassification did not have any impact on the Company’s consolidated statements of operations, consolidated statements of comprehensive loss, consolidated statements of cash flows and net loss per share calculations. The following table summarizes the impact of the restatement adjustments on Venus Concept Ltd.’s previously reported consolidated financial statements: As previously reported Adjustment As restated $ $ $ Consolidated balance sheet and consolidated statement of stockholders' equity January 1, 2019 Common Stock 57,101 (57,096 ) 5 Additional paid in capital 10,399 57,096 67,495 March 31, 2019 Common Stock 57,108 (57,103 ) 5 Additional paid in capital 10,774 57,103 67,877 June 30, 2019 Common Stock 57,108 (57,103 ) 5 Additional paid in capital 11,818 57,103 68,921 September 30, 2019 Common Stock 57,459 (57,454 ) 5 Additional paid in capital 11,937 57,454 69,391 Foreign Currency The consolidated financial statements are presented in U.S. dollars. Amounts reported in thousands within this report are computed based on the amounts in dollars. As a result, the sum of the components reported in thousands may not equal the total amount reported in thousands due to rounding. Certain columns and rows within tables may not add due to the use of rounded numbers. Percentages presented are calculated from the underlying numbers in dollars. All exchange gains and losses from remeasurement of monetary balance sheet items resulting from transactions in non-functional currencies are recorded in the consolidated statements of operations as they arise. In respect of transactions denominated in currencies other than the Company and its subsidiaries’ functional currencies, the monetary assets and liabilities are remeasured at the period end rates. Revenue and expenses are remeasured at rates of exchange prevailing on the transaction dates. All of the exchange gains or losses resulting from these transactions are recognized in the consolidated statements of operations. Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less from the date of purchase to be cash equivalents. Cash and cash equivalents consist primarily of funds invested in readily available checking and savings accounts, investments in money market funds and short-term time deposits. Restricted Cash As of December 31, 2020, and 2019, the Company was required to hold $83 and $83, respectively, in a separate deposit account as collateral for rent and credit cards. Concentration of Credit Risk Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash and cash equivalents, accounts receivable and long-term receivables. The Company’s cash and cash equivalents are invested primarily in deposits with major banks worldwide, as such minimal credit risk exists with respect to such investments. The Company’s trade receivables are derived from global sales to customers. An allowance for doubtful accounts is provided with respect to all balances for which collection is deemed to be doubtful. Risks and Uncertainties The Company has considered the impact of COVID-19 on its consolidated financial statements. COVID-19 has had a significant negative impact on the Company’s consolidated financial statements as of December 31 , 2020 and for the year then ended, and management expects the pandemic to continue to have a negative impact in the foreseeable future, the extent of which is uncertain and largely subject to whether the severity of the pandemic worsens, or duration lengthens. These impacts could include, but may not be limited to, risks and uncertainties related to the ability of the Company’s sales and marketing personnel and distributors to access the Company’s customer base, disruptions to the Company’s global supply chain, reduced demand and/or suspension of operations by the Company’s subscription customers which could impact their ability to make monthly payments, or deferral of aesthetic or hair restoration procedures which would impact the Company’s revenues. may subject the Company to future risk of material intangible and long-lived assets impairments, increased reserves for uncollectible accounts, and adjustments for inventory and market volatility for items subject to fair value measurements. Besides COVID-19 , t The Company has borrowings with interest rates that are subject to fluctuations as charged by the lender. The Company does not use derivative financial instruments to mitigate the exposure to interest rate risk. The Company’s objective is to have sufficient liquidity to meet its liabilities when due. The Company monitors its cash balances and cash used in operating activities to meet its requirements. As of December 31, 2020 and 2019, the most significant financial liabilities are the line of credit, trade payables, accrued expenses and other current liabilities and long-term debt. Concentration of Customers For the years ended December 31, 2020 and 2019, there were no customers accounting for more than 10% of the Company’s revenue. As of December 31, 2020 and 2019, there were no customers accounting for more than 10% of the Company’s accounts receivable. Allowance for Doubtful Accounts Trade accounts receivable do not bear interest and are typically not collateralized. The Company performs ongoing credit evaluations of its customers’ financial condition and maintains an allowance for doubtful accounts. Uncollectible accounts are charged to expense when deemed uncollectible, and accounts receivable are presented net of an allowance for doubtful accounts. Accounts receivable are deemed past due in accordance with the contractual terms of the agreement. Actual The allowance for doubtful accounts consisted of the following activity for years ended December 31, 2020 and 2019 (in thousands): As of December 31, 2020 2019 Balance at beginning of year $ 10,494 $ 4,408 Write-offs (6,536 ) (3,905 ) Provision 15,212 9,991 Sale of subsidiaries (680 ) - Balance at end of year $ 18,490 $ 10,494 Inventory Inventories are stated at the lower of cost or net realizable value and include raw materials, work in progress and finished goods. Cost is determined as follows: Raw Materials and Work in Progress (“WIP”) – Cost is determined on a standard cost basis utilizing the weighted average cost of historical purchases, which approximates actual cost. The cost of WIP and finished goods includes the cost of raw materials and the applicable share of the cost of labor and fixed and variable production overheads. The Company regularly evaluates the value of inventory based on a combination of factors including the following: historical usage rates, product end of life dates, technological obsolescence and product introductions. The Company includes demonstration units within inventories. Proceeds from the sale of demonstration units are recorded as revenue. Long-term Receivables Long-term receivables relate to the Company’s subscription revenue or contracts which stipulate payment terms which exceed one year. They are comprised of the unpaid principal balance, plus accrued interest, net of the allowance for credit losses. These receivables have been discounted based on the implicit interest rate in the subscription lease which range between 8% to 9% in 2020 and 8% to 9% in 2019. Unearned interest revenue represents the interest only portion of the respective subscription payments and will be recognized in income over the respective payment term as it is earned. Deferred revenues represent payments received prior to the income being earned. Once the equipment has been delivered or the services have been rendered, these amounts are recognized in income. Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which is between three and ten years. Leasehold improvements are depreciated over the lesser of the life of the lease or the useful life of the improvements. Maintenance and repairs are charged to expense as incurred. When assets are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the consolidated balance sheets, and any resulting gain or loss is reflected in the consolidated statements of operations. Intangible Assets Intangible assets consist of customer relationships, brand, technology and supplier agreement. Intangible assets are stated at cost less accumulated amortization. Amortization is computed using the straight-line method over the estimated useful lives of the respective assets, which range from approximately six to fifteen years. The useful lives of intangible assets are based on the Company’s assessment of various factors impacting estimated cash flows, such as the product’s position in its lifecycle, the existence or absence of like products in the market, various other competitive and regulatory issues, and contractual terms. Impairment of Long-Lived Assets The Company accounts for the impairment of long-lived assets in accordance with FASB, Accounting Standards Codification (“ASC”) 360-10, “Accounting for the Impairment of Long-Lived Assets”. This standard requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the assets’ carrying amounts may not be recoverable. For assets that are to be held and used, impairment is assessed when the estimated undiscounted cash flows associated with the asset or group of assets is less than their carrying values. If impairment exists, an adjustment is made to write the asset down to its fair value, and a loss is recorded as the difference between the carrying value and fair value. Fair values are determined based on quoted market values, discounted cash flows or internal and external appraisals, as applicable. Assets to be disposed of are carried at the lower of carrying value and estimated net realizable value. During the years ended December 31, 2020 and 2019, there was no impairment of long-lived assets. Goodwill Goodwill represents the excess of the purchase price of the business acquired over the fair value of the net identifiable assets of an acquired business. The Company allocates goodwill to reporting units at the time of acquisition or when there is a change in the reporting structure and bases that allocation on which reporting units will benefit from the acquired assets and liabilities. Reporting units are defined as operating segments or one level below an operating segment, referred to as a component. Goodwill is not amortized but is tested for impairment annually or more frequently when an event occurs, or circumstances change that indicate the carrying value may not be recoverable. The carrying values of goodwill and indefinite-life intangible assets are subject to annual impairment assessment as of the last day of each fiscal year. Between annual assessments, impairment review may also be triggered by any significant events or changes in circumstances affecting the Company’s business. The COVID-19 pandemic had significantly impacted the Company’s business during the first three months of 2020, including its sales, supply chain, manufacturing and accounts receivable collections. As a result, the Company considered the COVID-19 pandemic as a triggering event and conducted quantitative impairment assessment of its goodwill as of March 31, 2020. The Company has one reporting unit and the reporting unit’s carrying value was compared to its estimated fair value. As of March 31, 2020, the Company estimated its fair value using a combination of income approach and market approach. The income approach is based on the present value of future cash flows, which are derived from long term financial forecasts, and requires significant assumptions including among others, a discount rate and a terminal value. The market approach is based on the observed ratios of enterprise value to revenue multiples of the Company and other comparable publicly traded companies. Based upon the results of the goodwill impairment assessment, the Company recorded an impairment charge of $27,450 as of March 31, 2020, which represented the full balance of goodwill for the reporting unit. Based on the analysis of the intangible assets and long-lived assets as of December 31, 2020, Debt Issuance Costs Costs related to the issuance of debt are presented as a direct deduction to the carrying value of the debt and are amortized to accretion expenses using the effective interest rate method over the term of the related debt. Derivatives The Company reviews the terms of convertible notes, equity instruments and other financing arrangements to determine whether there are embedded derivative instruments, including embedded conversion options that are required to be bifurcated and accounted for separately as a derivative financial instrument. Derivative financial instruments are initially measured at their fair value. Derivative financial instruments that are accounted for as liabilities, are initially recorded at fair value and then re-valued at each reporting date, with changes in the fair value recognized in the consolidated statements of operations. Revenue Recognition The Company adopted Accounting Standards Codification (“ASC”) 606 “Revenue from contract with customers” The Company generates revenue from (1) sales of systems through the subscription model, traditional system sales to customers and distributors, (2) other product revenues from the sale of marketing supplies and kits, consumables and Venus Concept’s skincare and hair products and (3) service revenue from the sale of VeroGrafters ™ Many of the Company’s products are sold under subscription contracts with control passing to the customer at the earlier of the end of the term and when the payment is received in full. The subscription contracts include an initial deposit followed by monthly installments typically over a period of 36 months. In accordance with ASC 840 “Leases” (“ASC 840”), these arrangements are considered to be sales-type leases, where the present value of all cash flows to be received within the arrangement is recognized upon shipment to the customer and achievement of the required revenue recognition criteria. Various accounting and reporting systems are used to monitor subscription receivables which include providing access codes to operate the machines to paying customers and restricting access codes on machines to non-paying customers The Company recognizes revenues on other products and services in accordance with ASC 606. Revenue is recognized based on the following five steps: (1) identification of the contract(s) with the customer; (2) identification of the performance obligations in the contract; (3) determination of the transaction price; and (4) allocation of the transaction price to the separate performance obligations in the contract; and (5) recognition of revenue when (or as) the entity satisfies a performance obligation. The Company does not grant rights of return to its end customers. The Company’s products sold through arrangements with distributors are non-refundable, non-returnable and without any rights of price protection. The Company records revenue net of sales tax and shipping and handling costs. Cost of Goods For subscription sales (qualifying as sales-type lease arrangements) and product sales, the costs are recognized upon shipment to the customer or distributor. Advertising Costs The cost of advertising and media is expensed as incurred. For the years ended December 31, 2020 and 2019, advertising costs totaled $1,092 and $2,004, respectively. Research and Development Research and development costs are charged to operations as incurred. Major components of research and development expenses consist of personnel costs, including salaries and benefits, hardware and software research and development costs, regulatory affairs, and clinical costs. Warranty The Company provides a standard warranty against defects for all of its systems. The warranty period begins upon shipment and is typically for a period between one and three years. The Company records a liability for accrued warranty costs at the time of sale of a system, which consists of the warranty on products sold based on historical warranty costs and management’s estimates. The Company periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts thereof as necessary. The Company also provides an extended warranty service. Extended warranty can be purchased at any time after the purchase of a system and prior to the expiration of the standard warranty provided with the sale of the system. Extended warranty services include standard warranty services. The Company recognizes the revenue from the sale of an extended warranty over the period of the extended warranty and accounts it for separately from the standard warranty. Income Taxes The Company follows the deferred income taxes method of accounting for income taxes. Under this method, deferred income taxes are recognized for the future tax consequences attributable to differences between the financial statement carrying values of accounts and their respective income tax basis. Deferred income tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years during which the temporary differences are expected to be realized or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is included in income in the period that includes the enactment date. The Company establishes valuation allowances when necessary to reduce deferred tax assets to the amounts that are more likely than not to be realized. The Company evaluates tax positions taken or expected to be taken in the course of preparing tax returns to determine whether the tax positions have met a “more likely-than-not” threshold of being sustained by the applicable tax authority. Tax benefits related to tax positions not deemed to meet the “more likely-than-not” threshold are not permitted to be recognized in the consolidated financial statements. Uncertain Tax Positions The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained on examination based on the technical merit of the position. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on examination, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount, which is more than 50% likely of being realized upon ultimate settlement. The Company considers many factors when evaluating and estimating its tax positions and tax benefits, which may require periodic adjustments. The Company recognizes interest charges and penalties related to unrecognized tax benefits as a component of the tax provision and recognizes interest charges and penalties related to recognized tax positions in the accompanying consolidated statements of operations. Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718, “Compensation – Stock Compensation” (“ASC 718”). ASC 718 requires companies to estimate the fair value of equity-based payment awards on the date of grant. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service period in the Company’s consolidated statements of operations. The fair value of stock options (“options”) on the grant date is estimated using the Black-Scholes option-pricing model using the single-option approach. The Black-Scholes option pricing model requires the use of highly subjective and complex assumptions, including the option’s expected term and the price volatility of the underlying stock, to determine the fair value of the award. The Company recognizes compensation expenses for the value of its awards granted based on the straight-line method over the requisite service period of each of the awards. The Company has made a policy choice to account for forfeitures when they occur. Stock options granted to non-employees are based on the fair value on the grant date and re-measured at the end of each reporting period based on the fair value until the earlier of the options being fully vested and completion of the performance obligations. These are subject to a service vesting condition and are recognized on a straight-line method over the requisite service period. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Estimated forfeitures are based on historical pre-vesting forfeitures. Net Loss Per Share The Company computes net (loss) income per share in accordance with ASC Topic 260, “Earnings Per Share” (“ASC 260”) and related guidance, which requires two calculations of net (loss) income attributable to the Company’s shareholders per share to be disclosed: basic and diluted. Convertible preferred shares are participating securities and are included in the calculation of basic and diluted net (loss) income per share using the two-class method. In periods where the Company reports net losses, such losses are not allocated to the convertible preferred shares for the computation of basic or diluted net (loss) income. Diluted net (loss) income per share is the same as basic net (loss) income per share for the periods in which the Company had a net loss because the inclusion of outstanding common stock equivalents would be anti-dilutive. JOBS Act Accounting Election The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it is (i) no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, these consolidated financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates. Recently Issued Accounting Standards Not Yet Adopted In April 2020, Financial Accounting Standards Board (the “FASB”) issued a Staff Question-and-Answer Document (Q&A): ASC Topic 842 and ASC Topic 840: Accounting for Lease Concessions Related to the Effects of the COVID-19 Pandemic, that focuses on the application of the lease guidance for lease concessions related solely to the effects of COVID-19. The FASB issued the guidelines to reduce the burden and complexity for companies to account for such lease concessions (e.g., rent abatements or other economic incentives) under current lease accounting rules due to COVID-19 by providing certain practical expedients that can be used. This guidance can be applied immediately. The Company anticipates that the adoption of the guidance will not have a material impact on the Company’s consolidated financial statements. In March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-04 - Facilitation of the Effects of Reference Rate Reform on Financial Reporting (ASC Topic 848). This authoritative guidance provides optional relief for companies preparing for the discontinuation of interest rates such as LIBOR, which is expected to be phased out at the end of calendar 2021, and applies to lease contracts, hedging instruments, held-to-maturity debt securities and debt arrangements that have LIBOR as the benchmark rate. This guidance can be applied for a limited time, as of the beginning of the interim period that includes March 12, 2020 or any date thereafter, through December 31, 2022. The guidance may no longer be applied after December 31, 2022. In January 2021, the FASB issued authoritative guidance that makes amendments to the new rules on accounting for reference rate reform. The amendments clarify that all derivative instruments affected by the changes to interest rates used for discounting, margining or contract price alignment, regardless of whether they reference LIBOR, or another rate expected to be discontinued as a result of reference rate reform, an entity may apply certain practical expedients in ASC Topic 848. The Company is currently assessing the impact of applying this guidance as well as when to adopt this guidance. In February 2020, the FASB issued authoritative guidance (ASU 2020-02 – Financial Instruments – Credit Losses (Topic 326) and Leases (Topic 842)) that amends and clarifies Topic 326 and Topic 842. For Topic 326, the codification was updated to include the SEC staff interpretations associated with registrants engaged in lending activities. ASC Topic 326 is effective for annual periods beginning after January 1, 2023, including interim periods within those fiscal years. The Company is currently evaluating the impact of applying this guidance on its financial instruments, such as accounts receivable. In December 2019, the FASB issued ASU 2019-12 – Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, an authoritative guidance that simplifies the accounting for income taxes by removing certain exceptions and making simplifications in other areas. It is effective from the first quarter of fiscal year 2022, with early adoption permitted in any interim period. If adopted early, the Company must adopt all the amendments in the same period. The amendments have differing adoption methods including retrospectively, prospectively and/or modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption, depending on the specific change. The Company is currently evaluating the impact of applying this guidance and believes that it has transactions that may fall under the scope of this guidance. |
Net Loss per Share
Net Loss per Share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | 3. NET LOSS PER SHARE Net Loss Per Share Basic net loss per share is calculated by dividing net loss by the weighted-average number of shares of common stock outstanding during the period, without consideration for common stock equivalents. Diluted net loss per share is computed by dividing net loss by the weighted-average number of common stock equivalents outstanding for the period determined using the treasury-stock method. For purposes of this calculation, common stock warrants and stock options are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. The net loss attributable to common stockholders’ is adjusted for the preferred stock deemed dividend related to the beneficial conversion feature for the periods in which the preferred stock is outstanding. The following table sets forth the computation of basic and diluted net loss and the weighted average number of shares used in computing basic and diluted net loss per share (in thousands, except per share data): For the year ended December 31, 2020 2019 Numerator: Net loss $ (82,818 ) $ (42,295 ) Net loss allocated to stockholders of the Company $ (85,270 ) $ (40,619 ) Denominator: Weighted-average shares of common stock outstanding used in computing net loss per share, basic and diluted 36,626 8,517 Net loss per share: Basic and diluted $ (2.33 ) $ (4.77 ) Due to the net loss, all the outstanding shares of common stock equivalents were excluded from the calculation of diluted net loss per share attributable to common stockholders for the years ended December 31, 2020 and 2019 because including them would have been antidilutive : December 31, 2020 2019 Options to purchase common stock 2,593,711 2,727,764 Warrants for common stock 16,290,067 3,990,067 Total potential dilutive shares 18,883,778 6,717,831 |
Sale of Subsidiaries
Sale of Subsidiaries | 12 Months Ended |
Dec. 31, 2020 | |
Sale Of Subsidiaries [Abstract] | |
Sale of Subsidiaries | 4 . SALE OF subsidiaries In 2020, the Company made several strategic decisions to divest of underperforming direct sales offices and sold its share in several subsidiaries, located in Bulgaria, Indonesia, Italy, India, Russia, Singapore, Vietnam, and Kazakhstan. Over the course of fiscal year ended December 31, 2020, the Company completed the following transactions: • Sold its share (51%) in its Bulgarian subsidiary, Venus Concept Central Eastern Europe Ltd., to an unrelated third party for cash consideration of Euro (“EUR”) 473 which was equivalent to $531. The disposal resulted in a loss of approximately $ • Sold its share (51%) in its Indian subsidiary, Venus Aesthetic LLP, to an unrelated third party • Sold its share (51%) in its Italian subsidiary, Venus Concept Italy S.r.l., to an unrelated third party EUR • Entered into a Termination Agreement of the Venus Concept Kazakhstan LLP Foundation Agreement, resulting in the cancellation of its 51% interest in the entity. This disposal resulted in a gain of approximately $58. • Sold its share (51%) of its Russian subsidiary, Venus Concept RU LLC, to an unrelated third party • Sold its share (55%) of its Singaporean subsidiary, Venus Concept Singapore Pte. Ltd., including its wholly owned subsidiary, Venus Concept Vietnam Co., Ltd., to a third party for cash consideration of $500. The disposal resulted in a loss of approximately $670. • Sold its share (100%) in its Indonesian subsidiary, InPhronics Limited, along with its 90% interest in its subsidiary, PT NeoAsia Medical, for the cash consideration of $955. The disposal resulted in a loss of approximately $33. As these disposals did not constitute a strategic shift that will have a major effect on the Company’s operations and financial results, and total operating revenue of the disposed subsidiaries did not exceed 15% of the Company’s total revenue, therefore the results of operations for disposed subsidiaries were not reported as discontinued operations under the guidance of Accounting Standards Codification (“ASC”) 205-20-45. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 5. FAIR VALUE MEASUREMENTS Financial assets and financial liabilities are initially recognized at fair value when the Company becomes a party to the contractual provision of the financial instrument. Subsequently, all financial instruments are measured at amortized cost using the effective interest method. The financial instruments of the Company consist of cash and cash equivalents, restricted cash, accounts receivable, long-term receivables, line of credit, trade payables, government assistance loans, accrued expenses and other current liabilities, earn-out liability, other long-term liabilities and long-term debt. In view of their nature, the fair value of most of the financial instruments approximates their carrying amounts. The Company measures the fair value of its financial assets and liabilities using the fair value hierarchy. A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level - Quoted prices in active markets for identical assets or liabilities. Level - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The categorization of a financial instrument within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company classifies its restricted cash and guaranteed investment certificates within Level 2 as it uses alternative pricing sources and models utilizing market observable inputs. Contingent earn-out consideration is classified within Level 3. The following tables set forth the fair value of the Company’s Level 2 and Level 3 financial assets and liabilities within the fair value hierarchy: Fair Value Measurements as of December 31, 2020 Quoted Prices in Active Markets using Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets Guaranteed Investment Certificates ("GIC") $ — $ 64 $ — $ 64 Restricted cash — 83 — 83 Total assets $ — $ 147 $ — $ 147 Liabilities Contingent earn-out consideration — — 147 147 Total liabilities $ — $ — $ 147 $ 147 Fair Value Measurements as of December 31, 2019 Quoted Prices in Active Markets using Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets Guaranteed Investment Certificates ("GIC") $ — $ 63 $ — $ 63 Restricted cash — 83 — 83 Total assets $ — $ 146 $ — $ 146 Liabilities Contingent earn-out consideration — — 655 655 Total liabilities $ — $ — $ 655 $ 655 The earn-out liability is measured using discounted cash flow techniques, with the expected cash outflows estimated based on the probability of assessment of the acquired business achieving the revenue metrics required for payment. Expected future revenues of the acquired business and the associated estimate of probability are not observable inputs. The payments due are based on point in time measurements of the metrics quarterly for two years from the acquisition date. The following table provides a roll forward of the aggregate fair values of the earn-out liability as of December 31, 2020, for which fair value is determined using Level 3 inputs: Beginning balance $ 950 Payments (828 ) Change in value 533 December 31, 2019 655 Payments (799 ) Change in value 291 December 31, 2020 $ 147 In addition to earn-out contingent liability disclosed above, the Company has an annual installment payable of $250. On September 25, 2020, pursuant to an amendment to its master asset purchase agreement dated January 26, 2018, the Company established a payment plan for the earn out liability and annual installment payout, according to which $500 was paid before December 1, 2020 and $147 was paid on January 4, 2021. |
Accounts Receivable
Accounts Receivable | 12 Months Ended |
Dec. 31, 2020 | |
Receivables [Abstract] | |
Accounts Receivable | 6. ACCOUNTS RECEIVABLE The Company’s products may be sold under subscription contracts with control passing to the customer at the end of the lease term, which is generally 36 months. These arrangements are considered to be sales-type leases, where the present value of all cash flows to be received within the arrangement is recognized upon shipment to the customer as lease revenue. A financing receivable is a contractual right to receive money, on demand or on fixed or determinable dates, that is recognized as an asset on the Company's consolidated balance sheets. The Company's financing receivables, consisting of its sales-type leases, totaled $49,096 and $72,602 at December 31, 2020 and 2019, respectively, and are included in accounts receivable and long-term receivables on the consolidated balance sheets. The Company evaluates the credit quality of an obligor at lease inception and monitors credit quality over the term of the underlying transactions. The Company performed an assessment of the allowance for doubtful accounts as of December 31, 2020 and 2019. Based upon such assessment, the Company recorded an allowance for doubtful totaling $18,490 and $10,494 as of December 31, 2020 and 2019, respectively. A summary of the Company’s accounts receivables is presented as follows: As of December 31, 2020 2019 Gross accounts receivable $ 92,402 $ 105,127 Unearned income (3,728 ) (5,623 ) Allowance for doubtful accounts (18,490 ) (10,494 ) $ 70,184 $ 89,010 Reported as: Current trade receivables $ 52,764 $ 58,977 Current unearned interest income (1,950 ) (3,942 ) Long-term trade receivables 21,148 35,656 Long-term unearned interest income (1,778 ) (1,681 ) $ 70,184 $ 89,010 Current subscription contracts are reported as part of accounts receivable. The following are the contractual commitments, net of allowance for doubtful accounts, to be received by the Company over the next 5 years: December 31, Total 2021 2022 2023 2024 2025 Current financing receivables, net of allowance of $7,190 $ 27,948 $ 27,948 $ — $ — $ — $ — Long-term financing receivables, net of allowance of $4,915 21,148 — 16,076 5,001 71 — $ 49,096 $ 27,948 $ 16,076 $ 5,001 $ 71 $ — |
Select Balance Sheet and Statem
Select Balance Sheet and Statement of Operations Information | 12 Months Ended |
Dec. 31, 2020 | |
Select Balance Sheet And Income Statement Information [Abstract] | |
Select Balance Sheet and Statement of Operations Information | 7. SELECT BALANCE SHEET AND STATEMENT OF OPERATIONS INFORMATION Inventory Inventory December 31, 2020 2019 Raw materials $ 838 $ 877 Work-in-progress 1,232 2,067 Finished goods 15,689 15,900 Total inventory $ 17,759 $ 18,844 Additions to inventory are primarily comprised of newly produced units and applicators, refurbishment cost from demonstration units and used equipment which were reacquired during the year from upgraded sales. The Company expensed $21,258 ($26,869 in 2019) in cost of goods sold during the year. The balance of cost of goods sold represents the sale of applicators, parts and warranties. The Company provides for excess and obsolete inventories when conditions indicate that the inventory cost is not recoverable due to physical deterioration, usage, obsolescence, reductions in estimated future demand and reductions in selling prices. Inventory provisions are measured as the difference between the cost of inventory and net realizable value to establish a lower cost basis for the inventories. As of December 31, 2020, a provision for obsolescence of $1,208 ($1,439 in 2019) was taken against inventory. Property and Equipment, Net Property December 31, Useful Lives (in years) 2020 2019 Lab equipment tooling and molds 4 - 10 $ 8,053 $ 7,872 Office furniture and equipment 6 - 10 1,760 1,710 Leasehold improvements up to 10 1,838 1,950 Computers and software 3 1,815 1,811 Vehicles 5 - 7 12 16 Total property and equipment 13,478 13,359 Less: Accumulated depreciation (9,939 ) (8,711 ) Total property and equipment, net $ 3,539 $ 4,648 Depreciation expense amounted to $1,331 and $1,026 for the years ended December 31, 2020 and 2019. Other Current Assets December 31, 2020 2019 Government remittances (1) $ 1,009 $ 1,704 Consideration receivable from subsidiaries sale 2,580 - Deferred financing costs 1,063 - Sundry assets and miscellaneous 1,022 1,397 Total other current assets $ 5,674 $ 3,101 (1) Government remittances are receivables from the local tax authorities for refund of sales taxes and income taxes. Accrued Expenses and Other Current Liabilities December 31, 2020 2019 Payroll and related expense $ 1,312 $ 3,117 Accrued expenses 8,582 10,645 Commission accrual 2,827 4,215 Sales and consumption taxes 7,532 3,143 Total accrued expenses and other current liabilities $ 20,253 $ 21,120 Warranty Accrual The following table provides the details of the change in the Company’s warranty accrual: December 31, 2020 2019 Balance as of the beginning of the year $ 1,977 $ 1,336 Warranties assumed through business combination - 273 Warranties issued during the year 761 1,038 Warranty costs incurred during the year (1,099 ) (670 ) Balance at the end of the year $ 1,639 $ 1,977 Current 1,106 1,254 Long-term 533 723 Total $ 1,639 $ 1,977 Finance Expenses The following table provides the details of the Company’s finance expenses: December 31, 2020 2019 Interest expense $ 7,615 $ 7,166 Gain on settlement of debt — (297 ) Accretion on long-term debt 728 680 Total finance expenses $ 8,343 $ 7,549 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | 8. INTANGIBLE ASSETS AND GOODWILL As described in Note 1, in November 2019, the Company completed its business combination with Venus Concept Ltd., which included the addition of goodwill of $24,847 and amortizable intangible assets, represented by the technology ($16,900) and the brand name ($1,200). Goodwill associated with the Merger was primarily attributable to the future revenue growth opportunities associated with additional share in the hair restoration market, as well as the value associated with the assembled workforce. The carrying values of goodwill and indefinite-life intangible assets are subject to annual impairment assessment as of the last day of each fiscal year. Between annual assessments, impairment review may also be triggered by any significant events or changes in circumstances affecting the Company’s business. The COVID-19 pandemic significantly impacted the Company’s business during the first three months of 2020, including its sales, supply chain, manufacturing and accounts receivable collections. As a result, the Company considered the COVID-19 pandemic as a triggering event and conducted quantitative impairment assessment of its goodwill as of March 31, 2020. The Company has one reporting unit and the reporting unit’s carrying value was compared to its estimated fair value. As of March 31, 2020, the Company estimated its fair value using a combination of income approach and market approach. The income approach is based on the present value of future cash flows, which are derived from long term financial forecasts, and requires significant assumptions including among others, a discount rate and a terminal value. The market approach is based on the observed ratios of enterprise value to revenue multiples of the Company and other comparable publicly traded companies. Based upon the results of the goodwill impairment assessment, the Company recorded an impairment charge of $27,450 as of March 31, 2020, which represented the full balance of goodwill for the reporting unit. Based on the analysis of the intangible assets and long-lived assets as of December 31, 2020, Intangible assets net of accumulated amortization were as follows: At December 31, 2020 Gross Amount Accumulated Amortization Net Amount Customer relationships $ 1,400 $ (242 ) $ 1,158 Brand 2,500 (540 ) 1,960 Technology 16,900 (3,286 ) 13,614 Supplier agreement 3,000 (867 ) 2,133 Total intangible assets $ 23,800 $ (4,935 ) $ 18,865 At December 31, 2019 Gross Amount Accumulated Amortization Net Amount Customer relationships $ 1,400 $ (149 ) $ 1,251 Brand 2,500 (276 ) 2,224 Technology 16,900 (469 ) 16,431 Supplier agreement 3,000 (568 ) 2,432 Total intangible assets $ 23,800 $ (1,462 ) $ 22,338 Estimated amortization expense for the next five fiscal years and all years thereafter are as follows: Years ending December 31, 2021 $ 3,473 2022 3,473 2023 3,473 2024 3,473 2025 3,473 Thereafter 1,500 Total $ 18,865 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. COMMITMENTS AND CONTINGENCIES Operating Leases The Company and its subsidiaries have various operating lease agreements, which expire on various dates. The Company recognizes rent expense on a straight-line basis over the non-cancellable lease period and records the difference between cash rent payments and the recognition of rent expense as a deferred rent liability. When leases contain escalation clauses, rent abatements and/or concessions, such as rent holidays and landlord or tenant incentives or allowances, the Company applies them in the determination of straight-line rent expense over the lease period. Aggregate future minimum lease payments and purchase commitments with manufacturers as of December 31, 2020 are as follows: Years ending December 31, Office Lease Purchase Commitments Total 2021 $ 1,701 $ 7,309 $ 9,010 2022 681 — 681 2023 277 — 277 2024 199 — 199 2025 204 204 Thereafter 994 — 994 Total $ 4,056 $ 7,309 $ 11,365 The total rent expense for all operating leases for the years ended December 31, 2020 and 2019 was $1,961 and $2,199, respectively. Commitments As of December 31, 2020, the Company has non-cancellable purchase orders placed with its contract manufacturers in the amount of $7,207. In addition, as of December 31, 2020, the Company had $686 of open purchase orders that can be cancelled with 180 days’ notice, except for a portion equal to 15% of the total amount representing the purchase of “long lead items”. Legal Proceedings Purported Shareholder Class Actions Between May 23, 2018 and June 11, 2019, four putative shareholder class actions complaints were filed against Restoration Robotics, Inc., certain of its former officers and directors, certain of its venture capital investors, and the underwriters of the IPO. Two of these complaints, Wong v. Restoration Robotics, Inc., et al., No. 18CIV02609, and Li v. Restoration Robotics, Inc., et al., No. 19CIV08173 (together, the “State Actions”), were filed in the Superior Court of the State of California, County of San Mateo, and assert claims under Sections 11, 12(a)(2) and 15 of the Securities Act of 1933, or the Securities Act. The other two complaints, Guerrini v. Restoration Robotics, Inc., et al., No. 5:18-cv-03712-EJD and Yzeiraj v. Restoration Robotics, Inc., et al., No. 5:18-cv-03883-BLF (together, the “Federal Actions”), were filed in the United States District Court for the Northern District of California and assert claims under Sections 11 and 15 of the Securities Act. The complaints all allege, among other things, that the Restoration Robotics’ Registration Statement filed with the SEC on September 1, 2017 and the Prospectus filed with the SEC on October 13, 2017 in connection with Restoration Robotics’ IPO were inaccurate and misleading, contained untrue statements of material facts, omitted to state other facts necessary to make the statements made not misleading and omitted to state material facts required to be stated therein. The complaints seek unspecified monetary damages, other equitable relief and attorneys’ fees and costs. In the State Actions Restoration Robotics, Inc., along with the other defendants, successfully demurred to the initial Wong complaint for failure to state a claim and secured a stay of both cases based on the forum selection clause contained in its Amended and Restated Certificate of Incorporation, which designates the federal district courts as the exclusive forums for claims arising under the Securities Act. However, on December 19, 2018, the Delaware Court of Chancery in Sciabacucchi v. Salzberg held that exclusive federal forum provisions are invalid under Delaware law. Based on this ruling, the San Mateo Superior Court lifted its stay of State Actions on December 10, 2019. On January 17, 2020, Plaintiffs in the State Actions filed a consolidated amended complaint for violations of federal securities laws, alleging again that, among other things, the Registration Statement filed with the SEC on September 1, 2017 and the Prospectus filed with the SEC on October 13, 2017 in connection with Restoration Robotics’ IPO were inaccurate and misleading, contained untrue statements of material facts, omitted to state other facts necessary to make the statements made not misleading and omitted to state material facts required to be stated therein. The complaint seeks unspecified monetary damages, other equitable relief and attorneys’ fees and costs. On February 24, 2020, the Company demurred to the consolidated amended complaint for failure to state a claim. On March 18, 2020, the Delaware Supreme Court reversed the Chancery Court’s decision in Sciabacucchi v. Salzberg and held that exclusive federal forum provisions are valid under Delaware law. On March 30, 2020, the Company filed a renewed motion to dismiss based on its federal forum selection clause. A hearing on the Company’s demurrer and renewed motion to dismiss was held on June 12, 2020. On September 1, 2020, the court granted the renewed motion to dismiss based on the Company’s forum selection clause as to the Company and individual defendants, but not as to the venture capital and underwriter defendants. On September 22, 2020, the Court entered a judgement of dismissal as to the Company and the individual defendants. On November 23, 2020, plaintiff filed a notice of appeal of the Court’s order granting the renewed motion to dismiss. That appeal is pending. In the Federal Actions, which have been consolidated under the caption In re Restoration Robotics, Inc. Securities Litigation, Case No. 5:18-cv-03712-EJD, Lead Plaintiff Eduardo Guerrini filed his consolidated amended complaint for violations of federal securities laws on November 30, 2018. The consolidated amended complaint alleges again that, among other things, Restoration Robotics’ Registration Statement filed with the SEC on September 1, 2017 and the Prospectus filed with the SEC on October 13, 2017 in connection with the IPO were inaccurate and misleading, contained untrue statements of material facts, omitted to state other facts necessary to make the statements made not misleading and omitted to state material facts required to be stated therein. On January 29, 2019, Restoration Robotics, Inc., along with certain of its former officers and directors, filed a motion to dismiss the consolidated amended complaint for failure to state a claim. On October 18, 2019, the District Court granted Restoration Robotics, Inc. motion to dismiss as to all but two allegedly false or misleading statements contained in the Company’s Prospectus. On December 9, 2019, the Company filed its answer to the consolidated amended complaint denying the falsity of these statements, and discovery is underway. On May 29, 2020, Lead Plaintiff filed a motion for class certification, which the Company elected not to oppose, and on July 29, 2020, the court certified a class of investors who purchased shares of the Company common stock pursuant or traceable to the Company’s initial public offering. On February 22, 2021, the District Court granted the parties’ joint stipulation to stay all pending deadlines on the basis that the parties had reached a settlement in principle for all claims in the Federal Actions. Lead Plaintiff must file his motion for preliminary approval of the settlement by April 8, 2021. In addition to the State and Federal Actions, on July 11, 2019, a verified shareholder derivative complaint was filed in the United States District Court for the Northern District of California, captioned Mason v. Rhodes, No. 5:19-cv-03997-NC. The complaint alleges that certain of Restoration Robotics’ former officers and directors breached their fiduciary duties, have been unjustly enriched and violated Section 14(a) of the Securities Exchange Act of 1934, or the Exchange Act, in connection with the IPO and Restoration Robotics’ 2018 proxy statement. The complaint seeks unspecified damages, declaratory relief, other equitable relief and attorneys’ fees and costs. On August 21, 2019, the District Court granted the parties’ joint stipulation to stay the Mason action during the pendency of the Federal Actions. On December 15, 2020, the District Court granted the parties’ further stipulation to stay the Mason action during the pendency of the Federal Action, and the case remains stayed. The Company believes that the remaining lawsuits are without merit and management intends to vigorously defend against these claims. Administrative Investigation Case The Company’s Chinese subsidiary, Venus Concept China, imports and sells registered medical devices and unregistered non-medical devices in the People’s Republic of China (“PRC”). One of its unregistered products has been the subject of inquiries from two district level branches of the SAMR, Xuhui MSA and Huangpu MSA, as to whether the product was properly sold as a non-medical device. In January 2019, Venus Concept China applied to register a version of this non-medical device as a medical device with the National Medical Products Administration of PRC (“NMPA”). On June 12, 2019, Venus Concept China was informed that Xuhui MSA had opened an administrative investigation case related to whether the device is an unregistered medical device, as a result of a complaint that Xuhui MSA received from a former distributor of Venus Concept China. Huangpu MSA notified Venus Concept China that it would be suspending its separate investigation against Venus Concept China, pending the results of the Xuhui MSA investigation. The Company and Venus Concept China have voluntarily stopped sales in China of this product. On December 11, 2019, Xuhui MSA informed Venus Concept China that a determination had been made by the Shanghai Medical Products Administration that Versa’s IPL function should be administered as a Class II medical device. Xuhui MSA also suggested that Venus Concept China consider a voluntary recall of all Versa units sold in China. In late January 2020, Venus Concept China received a copy of the Shanghai Medical Products Administration’s determination that because of the intended uses for Versa’s IPL function comprise medical treatment functions such as “treatment of benign pigmented epidermis and skin lesions,” Versa’s IPL function should be administered as a Class II medical device. In April 2020, Venus Concept China received a determination from NMPA on its application for registering Versa’s IPL function as a medical device. NMPA has approved the registration of one applicator HR 650 for hair removal as a Class II medical device out of the four IPL applicators for which Venus Concept China had originally applied. The date of registration is April 15, 2020. Venus Concept China also submitted an explanation letter and a draft Corrective & Preventive Action Report plan to Xuhui MSA during a meeting with the local authority on April 23, 2020. On March 4, 2021, the Xuhui MSA issued a written administrative penalty hearing notice (the “Notice”) to Venus Concept China. The Notice stated that Venus Concept China’s sale of Versa violated the relevant Chinese medical device administration regulation. As a result, Xuhui MSA proposed an administrative monetary penalty in the amount of approximately $150 or 976 Chinese Yuan (“CNY”) (the “Penalty Amount”). On March 8, 2021, Venus Concept China gave written notice to Xuhui MSA that it accepts the penalty decision proposed by Xuhui MSA. On March 19, 2021, Xuhui MSA issued a written administrative penalty decision to Venus Concept China (the “Decision”), which affirmed the administrative penalty proposed by the Notice. On March 19, 2021, the same day the Decision was issued, Venus Concept China remitted the full Penalty Amount to Xuhui MSA. Acceptance of the payment of the Penalty Amount by Xuhui MSA resulted in the conclusion of its investigation case against Venus Concept China and settlement of this matter. Further, the Company may from time to time continue to be involved in various legal proceedings of a character normally incident to the ordinary course of its business, which the Company does not deem to be material to its business and results of operations. |
Main Street Term Loan
Main Street Term Loan | 12 Months Ended |
Dec. 31, 2020 | |
Main Street Term Loan | |
Debt Instrument [Line Items] | |
Main Street Term Loan/Madryn Long-term Debt and Convertible Notes | 10. MAIN STREET TERM LOAN On December 8, 2020, the Company executed a loan and security agreement, a promissory note, and related documents for a loan in the aggregate amount of $50,000 for which CNB will serve as a lender pursuant to the Main Street Priority Loan Facility as established by the Board of Governors of the Federal Reserve System Section 13(3) of the Federal Reserve Act (the “MSLP Loan”). On December 9, 2020, the MSLP Loan had been funded and the transaction was closed. The MSLP Note has a term of five years and bears interest at a rate per annum equal to 30-day LIBOR plus 3%. On December 8, 2023 and December 8, 2024, the Company must make an annual payment of principal plus accrued but unpaid interest in an amount equal to fifteen percent (15%) of the outstanding principal balance of the MSLP Note (inclusive of accrued but unpaid interest). The entire outstanding principal balance of the MSLP Note together with all accrued and unpaid interest is due and payable in full on December 8, 2025. The Company may prepay the MSLP Loan at any time without incurring any prepayment penalties. The MSLP Note provides for customary events of default, including, among others, those relating to a failure to make payment, bankruptcy, breaches of representations and covenants, and the occurrence of certain events. In addition, the MSLP Loan Agreement and MSLP Note contain various covenants that limit the Company’s ability to engage in specified types of transactions. Subject to limited exceptions, these covenants limit the Company’s ability, without CNB’s consent, to, among other things, sell, lease, transfer, exclusively license or dispose of our assets, incur, create or permit to exist additional indebtedness, or liens, to make dividends and other restricted payments, and to make certain changes to its ownership structure. |
Madryn Long-term Debt and Conve
Madryn Long-term Debt and Convertible Notes | 12 Months Ended |
Dec. 31, 2020 | |
Madryn Long-term Debt and Convertible Notes | |
Debt Instrument [Line Items] | |
Main Street Term Loan/Madryn Long-term Debt and Convertible Notes | 11. madryn LONG-TERM DEBT and convertible notes Madryn Credit Agreement On October 11, 2016, Venus Concept Ltd. entered into a credit agreement as a guarantor with Madryn Health Partners, LP, as administrative agent, and certain of its affiliates as lenders (collectively, “Madryn”), as amended (the “Madryn Credit Agreement”), pursuant to which Madryn agreed to make certain loans to certain of Venus Concept Ltd.’s subsidiaries (the “Subsidiary Obligors”). The Madryn Credit Agreement is comprised of four tranches of debt aggregating $70,000. As of September 30, 2020, and as of December 31, 2019, the Subsidiary Obligors had borrowed $60,000 under the term A-1 and A-2 and B tranches of the Madryn Credit Agreement. Term C borrowings of $10,000 were undrawn and are no longer available. Borrowings under the Madryn Credit Agreement were secured by substantially all of the Company’s assets and the assets of the Subsidiary Obligors. On the 24th payment date, which is September 30, 2022, the aggregate outstanding principal amount of the loans, together with any accrued and unpaid interest thereon and all other amounts due and owing under the loan agreement were to become due and payable in full. In connection with the Merger, the Company entered into an amendment to the Madryn Credit Agreement, dated as of November 7, 2019, (the “Amendment”), pursuant to which the Company joined as (i) a guarantor to the Madryn Credit Agreement and (ii) a grantor to the certain security agreement, dated October 11, 2016, (as amended, restated, supplemented or otherwise modified from time to time), by and among the grantors from time to time party thereto and the administrative agent (the “U.S. Security Agreement”). Effective August 14, 2018, interest on the Madryn loan was 9.00%, payable quarterly. Previously, interest was payable quarterly, at the Company’s option, as follows: cash interest 9.00% during the interest only period, which was 3 years or 12 principal payments after closing, plus an additional 4.00% rate, paid in kind (“PIK”). The Company had the option of settling the PIK interest in cash or adding the owed interest to the principal amount of the loan. On April 29, 2020, the Company entered into the Twelfth Amendment to the Madryn Credit Agreement that (i) required that interest payments for the period beginning January 1, 2020 and ending on, and including, April 29, 2020 (the “PIK Period”), be paid-in-kind, (ii) increased the interest rate from 9.00% per annum to 12.00% per annum during the PIK Period and (iii) require the Company to provide certain additional financial and other reporting information to the lenders. On June 30, 2020, the Company entered into the Thirteenth Amendment On September 30, 2020, the Company entered into the Fourteenth Amendment to the Madryn Credit Agreement that (i) required that fifty percent (50%) of the interest payments for the period beginning July 1, 2020 and ending on, and including, September 30, 2020 (the “Second PIK Period”), be paid in cash, (ii) the remaining fifty percent (50%) of the interest payments for the Second PIK Period, to be paid in kind, and (iii) increased the interest rate applicable to the Second PIK Period from 9.00% per annum to 10.50% per annum On December 9, 2020, contemporaneously with the MSLP Loan Agreement (Note 10), the Company, Venus USA, Venus Concept Canada Corp., Venus Concept Ltd., and the Madryn Noteholders (as defined below), entered into a Securities Exchange Agreement (the “Exchange Agreement”) dated as of December 8, 2020, pursuant to which the Company (i) repaid $42,500 aggregate principal amount owed under the Madryn Credit Agreement, and (ii) issued, to the Madryn Health Partners (Cayman Master), LP and Madryn Health Partners, LP (the “Madryn Noteholders”) secured subordinated convertible notes (the “Notes”) in the aggregate principal amount of $26,695. The Madryn Credit Agreement was terminated effective December 9, 2020 upon the funding and closing of the MSLP Loan and the issuance of the Notes. According to the Exchange Agreement, the Company shall pay to each investor its ratable share of an aggregate $1,600 closing fee. The closing fee shall be paid in the form of outstanding principal balance of the Notes as of the closing date. Since the closing fee is paid to the existing creditors (Madryn Noteholders were also creditors under the Madryn Credit Agreement), it was included in the calculation of the loss on extinguishment. The total loss recognized on extinguishment was $2,938. Secured Subordinated Convertible Notes The Notes will accrue interest at a rate of 8.0% per annum from the date of original issuance of the Notes to the third anniversary date of the original issuance and thereafter interest will accrue at a rate 6.0% per annum. Under certain circumstances, in the case of an event of default under the Notes, the then applicable interest rate will increase by 4.0% per annum. Interest is payable quarterly in arrears on the last business day of each calendar quarter of each year after the original issuance date, beginning on December 31, 2020. The Notes will mature on December 9, 2025, unless earlier redeemed or converted. In connection with the Exchange Agreement, the Company also entered into (i) a Guaranty and Security Agreement dated as of December 9, 2020 (the “Madryn Security Agreement”), by and among pursuant to which the Company agreed to grant Madryn a security interest, in substantially all of its assets, to secure the obligations under the Notes and (ii) a Subordination of Debt Agreement dated as of December 9, 2020 (the “CNB Subordination Agreement”). The security interests and liens granted to the Madryn Noteholders under the Madryn Security Agreement will terminate upon the earlier of (i) an assignment of the Notes (other than to an affiliate of the Madryn Noteholders) pursuant to the terms of the Exchange Agreement and (ii) the first date on which the outstanding principal amount of the Notes is less than $10,000. Obligations under the Notes are secured by substantially all of the assets of the Company and its subsidiaries party to the Madryn Security Agreement. The Company obligations under the Notes and the security interests and liens created by the Madryn Security Agreement are subordinated to the Company’s indebtedness owing to CNB (including, but not limited, pursuant to the MSLP Loan Agreement and the CNB Loan Agreement par value $0.0001 per share, calculated by dividing the outstanding principal amount of the Notes (and any accrued and unpaid interest under the Notes) In connection with the Notes, the Company recognized interest expense of $135 during the period from December 9, 2020 through December 31, 2020. The conversion feature, providing the Madryn Noteholders with a right to receive the Company’s shares upon conversion of the Notes, was qualified for a scope exception in ASC 815-10-15 and did not require bifurcation. The Notes also contained embedded redemption features that provided multiple redemption alternatives. Certain redemption features provided the Madryn Noteholders with a right to receive cash and a variable number of shares upon change of control and an event of default (as defined in the Notes). The Company evaluated redemption upon change of control and an event of default under ASC 815, Derivatives and Hedging, and determined that these two redemption features required bifurcation. These embedded derivatives were accounted for as liabilities at their estimated fair value as of the date of issuance, and then subsequently remeasured to fair value as of each balance sheet date, with the related remeasurement adjustment being recognized as a component of change in fair value of derivative liabilities in the consolidated statements of operations. The Company determined the likelihood of event of default and change of control as remote as of December 9, 2020, and December 31, 2020, therefore a nominal value was allocated to the underlying embedded derivative liabilities as of December 9, 2020, and December 31, 2020 The scheduled payments on the outstanding borrowings as of December 31, 2020 are as follows: As of December 31, 2020 2021 $ 2,136 2022 2,136 2023 2,102 2024 1,606 2025 28,196 Total $ 36,176 For the year ended December 31, 2020, the Company did not make any principal repayments. |
Credit Facility
Credit Facility | 12 Months Ended |
Dec. 31, 2020 | |
Line Of Credit Facility [Abstract] | |
Credit Facility | 12. The Company has an agreement with City National Bank of Florida (“CNB”) pursuant to which CNB agreed to provide a revolving credit facility to certain of the Company’s subsidiaries in the maximum principal amount of $10,000 ($10,000 in 2019, starting from April 2019), to be used to finance working capital requirements (the “CNB Loan Agreement”). On March 20, 2020, the Company entered into a Second Amended and Restated Loan Agreement as a borrower with CNB, as amended, pursuant to which CNB agreed to make certain loans and other financial accommodations to the Company, and certain of its subsidiaries. In connection with the CNB Loan Agreement, the Company also entered into (i) a Second Amended and Restated Guaranty of Payment and Performance with CNB dated as of March 20, 2020, (the “CNB Guaranty”), pursuant to which the Company agreed to guaranty the obligations under the CNB Loan Agreement and (ii) a Security Agreement with CNB dated as of March 20, 2020, (the “CNB Security Agreement”), pursuant to which the Company agreed to grant CNB a security interest, in substantially all of its assets, to secure the obligations under the CNB Loan Agreement. Borrowings under the CNB Loan Agreement are secured by substantially all of the assets of the Company and its subsidiaries and the CNB Guaranty. On December 9, 2020, the Company entered into the Third Amended and Restated Loan Agreement pursuant to which CNB provided a revolving credit facility to the Company in the maximum principal amount of $10,000 to be used to finance working capital requirements. The CNB Loan Agreement contains various covenants that limit the Company’s ability to engage in specified types of transactions. Subject to limited exceptions, these covenants limit the Company’s ability, without CNB’s consent, to, among other things, sell, lease, transfer, exclusively license or dispose of the Company’s assets, incur, create or permit to exist additional indebtedness, or liens, to make dividends and certain other restricted payments, and to make certain changes to its management and/or ownership structure. The CNB Loan Agreement also contains a covenant requiring that a minimum of $23,000 in cash be held in a deposit account maintained with CNB for one year following the closing of the CNB Loan Agreement, and after the first anniversary of the CNB Loan Agreement, a minimum of $3,000 in cash must be held in a deposit account maintained with CNB. The Madryn Noteholders (defined above) have agreed to hold $20,000 in cash in an escrow account at CNB, and pursuant to an escrow agreement, such cash will be released back to the Madryn Noteholders on the first anniversary of the CNB Loan Agreement. The Company is required to maintain $3,000 in cash in a deposit account maintained with CNB at all times during the term of the CNB Loan Agreement. In addition, the CNB Loan Agreement contains certain covenants that require the Company to achieve certain minimum account balances, or a minimum debt service coverage ratio and a maximum total liability to tangible net worth ratio. If the Company or its subsidiaries fails to comply with these covenants, it will result in a default and require the Company to repay all outstanding principal amounts and any accrued interest. In connection with the CNB Loan Agreement, a loan fee of $1,000 is payable in equal installments on January 25, February 25 and March 25, 2021. As of December 31, 2020 and December 31, 2019, the Company was in compliance with all required covenants. An event of default under this agreement would cause a default under the MSLP Loan (see Note 10). |
Government Assistance Programs
Government Assistance Programs | 12 Months Ended |
Dec. 31, 2020 | |
Government Assistance Programs [Abstract] | |
Government Assistance Programs | 13. GOVERNMENT ASSISTANCE PROGRAMS The Company and one of its subsidiaries, Venus Concept USA Inc. (“Venus USA”), received funding in the total amount of $4,048 in connection with two Small Business Loans under the federal Paycheck Protection Program provided in Section 7(a) of the Small Business Act of 1953, as amended by the Coronavirus Aid, Relief, and Economic Security Act, as amended from time to time (the “PPP”). The Company entered the U.S. Small Business Administration Note dated as of April 21, 2020 in favor of CNB pursuant to which the Company borrowed $1,665 original principal amount, which was funded on April 29, 2020 (the “Venus Concept PPP Loan”). The Venus Concept PPP Loan bears interest at 1% per annum and matures in two years from the date of disbursement of funds under the loan. Interest and principal payments under the Venus Concept PPP Loan will be deferred for a period of six months. The Venus Concept PPP Loan contains certain covenants which, among other things, restrict the Company’s use of the proceeds of the PPP Loan to the payment of payroll costs, interest on mortgage obligations, rent obligations and utility expenses, require compliance with all other loans or other agreements with any creditor of the Company, to the extent that a default under any loan or other agreement would materially affect the Company’s ability to repay its PPP Loan and limit the Company’s ability to make certain changes to its ownership structure. Venus USA entered into a U.S. Small Business Administration Note dated as of April 15, 2020 in favor of CNB. Venus USA borrowed $2,383 original principal amount, which was funded on April 20, 2020 (the “Venus USA PPP Loan” and together with the Venus Concept PPP Loan, individually each a “PPP Loan” and collectively, the “PPP Loans”). The terms of the Venus USA PPP Loan are substantially similar to the terms of the Venus Concept PPP Loan. Under certain circumstances, all or a portion of the PPP Loans may be forgiven, however, there can be no assurance that any portion of the PPP Loans will be forgiven and that the Company would not be required to repay the PPP Loans in full. The Company recorded PPP Loans within the long-term liabilities in the consolidated balance sheet. Under the Madryn Credit Agreement each PPP Loan is permitted to be incurred by the Company and Venus Concept USA as long as certain conditions remain satisfied, including that all PPP Loans must be forgiven other than any amount which can fit under existing permitted debt baskets in the Madryn Credit Agreement. If the Company and/or Venus Concept USA defaults on the respective PPP Loan or if any of the conditions to the incurrence thereof under the Madryn Credit Agreement are not satisfied (i) events of default will occur under the Madryn Credit Agreement and the CNB Loan Agreement and (ii) the Company and Venus Concept USA may be required to immediately repay their respective PPP Loan. The U.S. Small Business Administration (the “SBA”) has decided, in consultation with the Department of the Treasury, that it will review all loans in excess of $2,000 following the lender’s submission of the borrower’s loan forgiveness application. To the extent that the SBA’s audit determines that Venus Concept USA was not entitled to the loan under the PPP, the loan may not be forgiven, an event of default would occur under the Madryn Credit Agreement and Venus Concept USA could be subject to civil and criminal penalties. As of December 31, 2020, the Company had $4,110 outstanding under the PPP Loans (none as of December 31, 2019). Certain of the Company’s subsidiaries applied for government assistance programs and received government subsidies aggregating to $1,117. The terms of these government assistance programs vary by jurisdiction. government subsidies received |
Common Stock Reserved For Issua
Common Stock Reserved For Issuance | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Common Stock Reserved For Issuance | 14. COMMON STOCK RESERVED FOR ISSUANCE The Company is required to reserve and keep available out of its authorized but unissued shares of Common Stock a number of shares sufficient to affect the conversion of all outstanding shares of convertible preferred stock, plus options granted and available for grant under the incentive plans. December 31, 2020 December 31, 2019 Outstanding common stock warrants 16,290,067 3,990,067 Outstanding stock options 4,433,392 3,278,439 Shares reserved for future option grants 262,622 742,828 Shares reserved for Lincoln Park 5,222,867 — Shares reserved for Madryn Noteholders 8,213,880 — Total common stock reserved for issuance 34,422,828 8,011,334 |
Stockholders Equity
Stockholders Equity | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Stockholders Equity | 15. STOCKHOLDERS EQUITY Common Stock The Company’s common stock confers upon its holders the following rights: • The right to participate and vote in the Company’s stockholder meetings, whether annual or special. Each share will entitle its holder, when attending and participating in the voting in person or via proxy, to one vote; • The right to a share in the distribution of dividends, whether in cash or in the form of bonus shares, the distribution of assets or any other distribution pro rata to the par value of the shares held by them; and • The right to a share in the distribution of the Company’s excess assets upon liquidation pro rata to the par value of the shares held by them. Series A Preferred Stock As noted in Note 1 above, in March 2020, the Company issued and sold to certain Investors an aggregate of 660,000 shares of Series A Preferred Stock. The terms of the Series A Preferred Stock are governed by a Certificate of Designation filed by the Company with the Secretary of State of the State of Delaware on March 18, 2020. The following is a summary of the material terms of the Series A Preferred Stock: • Voting Rights. The Series A Preferred Stock has no voting rights except as required by law and except that the consent of the holders of a majority of outstanding shares of the Series A Preferred Stock will be required to amend the terms of the Series A Preferred Stock or take certain other actions with respect to the Series A Preferred Stock. • Liquidation. The Series A Preferred Stock does not have a preference upon any liquidation, dissolution or winding-up of the Company. • Conversion . The Series A Preferred Stock is automatically convertible into shares of common stock, based on an initial conversion ratio of 1 , as adjusted in accordance with the Certificate of Designation, upon receipt of the approval of the Company’s stockholders. The Company is not permitted to issue any shares of common stock upon conversion of the Series A Preferred Stock to the extent that the issuance of such shares of common stock would exceed 19.99 of the Company’s outstanding shares of common stock as of the date of the initial issuance of the Series A Preferred Stock, unless the Company obtains shareholder approval to issue more than such 19.99 (the “Conversion Cap”). The Conversion Cap will be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction. • Dividends. No • Redemption . The Series A Preferred Stock is not redeemable at the election of the Company or at the election of the holder. • Maturity. The Series A Preferred Stock shall be perpetual unless converted. Upon issuance, the effective conversion price of the Series A Preferred Stock of $1.93 per share was lower than the market price of the Company’s common stock on the date of issuance of the Series A Preferred Stock of $2.47 per share; as a result, the Company recorded the beneficial conversion feature of $3,564 in APIC. Because the Series A Preferred Stock is perpetual, it is carried at the amount recorded at inception. Subsequently, upon conversion of the Series A Preferred Stock, the beneficial conversion feature was accounted for as deemed dividend as disclosed below. The Company evaluated the Series A Preferred Stock for liability or equity classification in accordance with the provisions of ASC 480, Distinguishing Liabilities from Equity, and determined that equity treatment was appropriate because the Series A Preferred Stock did not meet the definition of the liability instruments defined thereunder for convertible instruments. Specifically, the Series A Preferred Stock is not mandatorily redeemable and does not embody an obligation to buy back the shares outside of the Company’s control in a manner that could require the transfer of assets. Additionally, the Company determined that the Series A Preferred Stock would be recorded as permanent equity, not temporary equity, based on the guidance of ASC 480 given that the holders of equally and more subordinated equity would be entitled to also receive the same form of consideration upon the occurrence of the event that gives rise to the redemption or events of redemption that are within the control of the Company. Since Series A Preferred Stock was sold as a unit with warrants, the proceeds received were allocated to each instrument on a relative fair value basis as it is described below. 2020 Private Placement Warrants As noted in Note 1 above, in March 2020, the Company issued and sold to the Investors in the 2020 Private Placement warrants to purchase up to 6,675,000 shares of common stock with an exercise price of $3.50 per share, along with the shares of common stock and preferred stock the Investors purchased. The 2020 Private Placement Warrants have a five-year term and are exercisable beginning 181 days after their issue date. The Company evaluated the 2020 Private Placement Warrants for liability or equity classification in accordance with the provisions of ASC 480, Distinguishing Liabilities from Equity, and determined that equity treatment was appropriate because the warrants only require settlement through the issuance of the Company’s common stock which is not redeemable, and do not represent an obligation to issue a variable number of shares. Based on this guidance, the Company determined, for each issuance, that the 2020 Private Placement Warrants did not need to be accounted for as a liability. Accordingly, the 2020 Private Placement Warrants were classified as equity and are not subject to remeasurement at each balance sheet date. The proceeds received in the 2020 Private Placement were allocated to each instrument on a relative fair value basis. Total net proceeds of $20,300 reduced by $3,564 of the beneficial conversion feature were allocated as follows: $8,063 to Series A Preferred Stock, $4,052 to shares of common stock and $4,621 to the 2020 Private Placement Warrants issued. Series A Preferred Stock and common stock issued in the 2020 Private Placement were recorded at par value of $0.0001 with the excess of par value recorded in APIC. Conversion of Series A Preferred Stock shares On June 16, 2020, upon the approval of the Company’s stockholders, 660,000 shares of Series A Preferred Stock were converted into 6,600,000 shares of the Company’s common stock. As a result of the conversion, in accordance with ASC 470-20-40-1, the beneficial conversion of $ was recorded as a in APIC, December 2020 Public Offering Warrants and common stock As noted in Note 1 above, in December 2020, the Company issued and sold to the investors in the December 2020 Offering 11,250,000 shares of its common stock and warrants to purchase up to 5,625,000 shares of common stock with an exercise price of $2.50 per share. The December 2020 Offering Warrants have a five-year term and are exercisable immediately. The Company evaluated the December 2020 Public Offering Warrants for liability or equity classification in accordance with the provisions of ASC 480, Distinguishing Liabilities from Equity, and determined that equity treatment was appropriate because the warrants only require settlement through the issuance of the Company’s common stock, which is not redeemable, and do not represent an obligation to issue a variable number of shares. Based on this guidance, the Company determined, for each issuance, that the December 2020 Public Offering Warrants did not need to be accounted for as a liability. Accordingly, the December 2020 Public Offering Warrants were classified as equity and are not subject to remeasurement at each balance sheet date. The proceeds received in the December 2020 Public Offering were allocated to each instrument on a relative fair value basis. Total net proceeds of $20,476 were allocated as follows: $17,828 to shares of common stock and $2,648 to the December 2020 Offering Warrants issued. Common stock issued in the December 2020 Public Offering were recorded at par value of $0.0001 with the excess of par value recorded in APIC. 2010 Share Option Plan In November 2010, the Company’s Board of Directors (the “Board”) adopted a share option plan (the “2010 Share Option Plan”) pursuant to which shares of the Company’s common stock are reserved for issuance upon the exercise of options to be granted to directors, officers, employees and consultants of the Company. The 2010 Share Option Plan is administered by the Company’s Board, which designates the options and dates of grant. Options granted vest over a period determined by the Board, originally had a contractual life of seven years, which was extended by ten years in November 2017 and are non-assignable except by the laws of descent. The Board has the authority to prescribe, amend and rescind rules and regulations relating to the 2010 Share Option Plan, provided that any such amendment or rescindment that would adversely affect the rights of an Optionee that has received or been granted an Option shall not be made without the Optionee’s written consent. As of December 31, 2020, the number of shares of the Company’s common stock reserved for issuance and available for grant under the 2010 Share Option Plan was 138,275 (44,450 as of December 31, 2019). 2019 The 2019 Incentive Award Plan was originally established under the name Restoration Robotics, Inc., as the 2017 Incentive Award Plan. It was adopted by the Company’s Board on September 12, 2017 and approved by the Company’s stockholders on September 14, 2017. The 2017 Incentive Award Plan was amended, restated, and renamed as set forth above, and was approved by the Company’s stockholders on October 4, 2019. Under the 2019 Plan, 450,000 shares of common stock were initially reserved for issuance pursuant to a variety of stock-based compensation awards, including stock options, stock appreciation rights, or SARs, performance stock awards, performance stock unit awards, restricted stock awards, restricted stock unit awards and other stock-based awards, plus the number of shares remaining available for future awards under the 2019 Plan as of the date of the Merger. As of December 31, 2020, there were 124,347 of shares of common stock available under the 2019 Plan (698,378 as of December 31, 2019). The 2019 Plan contains an “evergreen” provision, pursuant to which the number of shares of common stock reserved for issuance pursuant to awards under such plan shall be increased on the first day of each year from 2020 and ending in 2029 equal to the lesser of (A) four percent (4.00%) of the shares of stock outstanding on the last day of the immediately preceding fiscal year and (B) such smaller number of shares of stock as determined by the Board. The Company recognized stock-based compensation for its employees and non-employees in the accompanying consolidated statements of operations as follows: Year Ended December 31, 2020 2019 Cost of sales $ 25 $ 3 Selling and marketing 872 840 General and administrative 1,151 1,238 Research and development 90 77 Total stock-based compensation $ 2,138 $ 2,158 Stock Options The fair value of each option is estimated at the date of grant using the Black-Scholes option pricing formula with the following assumptions : Year Ended December 31, 2020 2019 Expected term (in years) 6.00-6.54 4.00-5.00 Risk-free interest rate 0.38-1.5% 1.4-2.53% Expected volatility 42.83% 49.00% Expected dividend rate 0% 0% Expected Term —The expected term represents management’s best estimate for the options to be exercised by option holders. Volatility —Since the Company does not have a trading history for its common stock, the expected volatility was derived from the historical stock volatilities of comparable peer public companies within its industry that are considered to be comparable to the Company’s business over a period equivalent to the expected term of the stock-based awards. Risk-Free Interest Rate —The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the date of grant for zero-coupon U.S. Treasury notes with maturities approximately equal to the stock-based awards’ expected term. Dividend Rate —The expected dividend is zero as the Company has not paid nor does it anticipate paying any dividends on its common stock in the foreseeable future. Fair Value of Common Stock — Prior to the Merger, Venus Concept Ltd. used the price per share in its latest sale of securities as an estimate of the fair value of its ordinary shares. After the closing of the Merger, the fair value of the Company’s Common Stock is used to estimate the fair value of the stock-based awards at grant date. The following table summarizes stock option activity under the Company’s stock option plan: Number of Shares Weighted- Average Exercise Price per Share, $ Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding – January 1, 2020 3,278,439 5.29 5.08 $ 4,885 Options granted 1,978,000 4.17 - Options exercised (469,754 ) 2.45 464 Options forfeited/cancelled (353,293 ) 13.76 1 Outstanding - December 31, 2020 4,433,392 4.59 6.20 $ 247 Exercisable – December 31, 2020 2,593,711 4.40 4.32 $ 247 Expected to vest – after December 31, 2020 1,839,681 3.70 7.61 $ - The following tables summarize information about share options outstanding and exercisable on December 31, 2020: Options Outstanding Options Exercisable Exercise Price Range Number Weighted average remaining contractual term (years) Weighted average Exercise Price Options exercisable Weighted average remaining contractual term (years) Weighted average Exercise Price $0.15 - $3.64 2,878,185 6.01 $ 3.05 1,643,103 3.62 $ 2.71 $4.26 - $7.95 1,498,383 6.57 6.78 909,832 5.50 6.42 $12.45 - $26.10 35,011 7.58 18.45 19,638 7.45 18.89 $27.00 - $33.00 12,998 3.85 27.99 12,954 3.84 27.98 $36.00 - $94.65 8,815 6.37 46.14 8,184 6.37 45.41 4,433,392 6.20 $ 4.59 2,593,711 4.32 $ 4.40 The aggregate intrinsic value of options is calculated as the difference between the exercise price of the stock options and the fair value of the Company’s common stock for those options that had exercise prices lower than the fair value of the Company’s common stock. The total intrinsic value of options exercised were $464 and $1,532 for the years ended December 31, 2020 and 2019, respectively. The weighted-average grant date fair value of options granted was $4.17 and $5.50 per share for the years ended December 31, 2020 and 2019, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 16. INCOME TAXES The geographical breakdown of loss before income taxes is as follows: Year Ended December 31, 2020 2019 United States $ (63,259 ) $ (23,194 ) Other jurisdictions (18,378 ) (17,244 ) Loss before income taxes $ (81,637 ) $ (40,438 ) The components of the provision for income taxes are as follows: Year Ended December 31, 2020 2019 Current tax provision: Federal $ — $ — Foreign 1,619 2,989 Total current tax provision 1,619 2,989 Deferred tax benefit: Federal — — Foreign (438 ) (1,132 ) Total deferred tax benefit $ (438 ) $ (1,132 ) Total provision for income taxes $ 1,181 $ 1,857 Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. A valuation allowance is provided when it is more likely than not that the deferred tax assets will not be realized. On the basis of this evaluation, as of December 31, 2020, a valuation allowance of $82,587 has been recorded to recognize only the portion of the deferred tax asset that is more likely than not to be realized. The amount of the deferred tax asset considered realizable, however, could be adjusted if estimates of future taxable income during the carryforward period are reduced or increased or if objective negative evidence in the form of cumulative losses is no longer present and additional weight is given to subjective evidence such as our projections for growth. The valuation allowance increased by $26,433 and $54,049 for the years ended December 31, 2020 and 2019, respectively. The increases in valuation allowance in 2020 was due to ongoing operational losses. The Company’s effective tax rate substantially differed from the federal statutory tax rate primarily due to the change in the valuation allowance. The reconciliation between income taxes computed at the federal statutory income tax rate and the provision for income taxes is as follows: Year Ended December 31, 2020 2019 Loss before income taxes $ (81,637 ) $ (40,438 ) Theoretical tax benefit at the statutory rate (21.0% in 2020, 23.9% in 2019) (17,144 ) (9,665 ) Differences in jurisdictional tax rates (2,817 ) (337 ) Recognition of losses — (1,923 ) Valuation allowance 12,416 12,343 Non-deductible expenses 8,080 2,217 Other 646 (778 ) Total income tax provision 1,181 1,857 Net loss $ (82,818 ) $ (42,295 ) The components of the deferred tax assets and deferred tax liabilities are as follows: December 31, 2020 2019 Deferred tax assets: Property and equipment $ 735 $ 81 Deferred revenue 2,065 101 Allowance for doubtful accounts 2,670 440 Intangible assets (2,554 ) — Non-deductible expenses 8,350 — Warranty and other reserves 729 — Other 114 — Loss carryforwards 71,362 56,154 Valuation allowance (82,587 ) (56,154 ) Total deferred tax assets $ 884 $ 622 Deferred tax liabilities: Deferred revenue $ 811 $ 1,017 Total deferred tax liabilities $ 811 $ 1,017 As of December 31, 2020, the Company had federal, state and foreign net operating loss (“NOL”) carryforwards of approximately $285,094 ( $ in 2019) We may recognize the tax benefit from uncertain tax positions only if it is more likely than not that the tax position will be sustained upon examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. ASC 740 also provides guidance on de-recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and income tax disclosures. During the year we determined that $884 of future tax benefits met this criterion. Utilization of the research and development credits carryforwards may be subject to an annual limitation due to the ownership percentage change limitations provided by the IRC. However, the Company has not conducted a formal study to determine the extent of the limitations, which could impact the realizability of these credit carryforwards in future periods. The annual limitations may result in the expiration of the net operating losses and research and development credits before utilization. The Company files income tax returns in the United States and in various state jurisdictions with varying statutes of limitations. Tax years 2014 through 2020 remain open to examination by the Internal Revenue Service for the U.S. federal tax purposes. Uncertain Tax Positions The activity related to gross amount of unrecognized tax benefits is as follows: Year Ended December 31, 2020 2019 Balance as of the beginning of the year $ 1,467 $ 1,467 Increases related to tax positions in prior period 57 — Increases related to tax positions taken during the current period 60 — Balance at the end of the year $ 1,584 $ 1,467 These amounts are related to certain deferred tax assets with a corresponding valuation allowance. If recognized, the impact on the Company’s effective tax rate would not be material due to the full valuation allowance. Management believes that there will not be any significant changes in the Company’s unrecognized tax benefits in the next twelve-months. The Company recognizes interest and penalties related to unrecognized tax benefits in the provision for income taxes in the accompanying consolidated statement of operations. Accrued interest and penalties, if applicable, are included in accrued expenses and other current liabilities in the consolidated balance sheets. For the years ended December 31, 2020 and 2019, the Company did not recognize any accrued interest and penalties. The activity related to the tax effected amount of the recognized tax position as follows: Year Ended December 31, 2020 2019 Balance as of the beginning of the year $ - $ - Increases related to tax positions in prior period (369 ) — Increase related to interest expense (109 ) — Balance at the end of the year $ (478 ) $ - Additional current tax expense has been booked including interest and penalties relating to Venus Concept Australia Pty Ltd. for its historical tax return filing positions, which may be successfully challenged by the Australian Tax Office. The Company has recognized the full amount of the potential tax liability plus interest. Management believes that there will not be any significant changes in the Company’s recognized tax position in the next twelve-months. As such, the amount has been classified as a long-term tax payable in the consolidated balance sheet. |
Segment and Geographic Informat
Segment and Geographic Information | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | 17. SEGMENT AND GEOGRAPHIC INFORMATION Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the Chief Operating Decision Maker (CODM) in deciding how to allocate resources to an individual segment and in assessing performance. The Company's CODM is its Chief Executive Officer. The Company has determined it operates in a single operating segment and has one reportable segment, as the CODM reviews financial information presented on a consolidated basis accompanied by disaggregated information about revenues by geography and type for purposes of making operating decisions, allocating resources, and evaluating financial performance. The Company does not assess the performance of individual product line on measures of profit or loss, or asset-based metrics. Therefore, the information below is presented only for revenues by geography and type. Revenue by geographic location, which is based on the product shipped to location, is summarized as follows: Year Ended December 31, 2020 2019 United States $ 33,987 $ 47,723 International 44,027 62,683 Total revenue $ 78,014 $ 110,406 As of December 31 December 31 Revenue by type is a key indicator for providing management with an understanding of the Company’s financial performance, which is organized into four different categories: 1. Lease revenue - includes all system sales with typical lease terms of 36 months. 2. System revenue – includes all systems sales with payment terms within 12 months. 3. Product revenue – includes skincare, hair and other consumables payable upon receipt. 4. Service revenue - includes NeoGraft® technician services, ad agency services and extended warranty sales. The following table presents revenue by type: Year Ended December 31, 2020 2019 Lease revenue $ 33,428 $ 65,170 System revenue 28,957 31,730 Product revenue 10,858 6,943 Service revenue 4,771 6,563 Total revenue $ 78,014 $ 110,406 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 18. RELATED PARTY TRANSACTIONS All amounts were at recorded at the exchange amount, which is the amount established and agreed to by the related parties. The following are transactions between the Company and parties related through employment. Distribution agreements On January 1, 2018, the Company entered into a new Distribution Agreement with Technicalbiomed Co., Ltd. (“TBC”), pursuant to which TBC will continue to distribute the Company’s products in Thailand. A senior manager of the Company is a 30.0% shareholder of TBC. For the years ended December 31, 2020 and 2019, TBC purchased products in the amount of $278 and $378, respectively, under this distribution agreement. These sales are included in products and services revenue. Intellectual Property Transfer Agreement In August 2013, the Company entered into a license agreement for the rights to an invention for fractional radio frequency treatment of the skin with the developers of the technology. Pursuant to the license agreement, the developers, amongst which one is a senior executive of the Company, granted to the Company an exclusive worldwide, perpetual, irrevocable license to develop and commercialize their inventions and any product into which it is integrated. As consideration for such license, the Company agreed to pay the developers 7.0 December 31, 2020 and December 31, 2019. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | 19. SUBSEQUENT EVENTS In February 2021, several investors exercised an aggregate of 361,200 December 2020 Public Offering Warrants at the exercise price of $2.50 per share. The total proceeds received by the Company from the December 2020 Public Offering Warrants exercises were $903. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP). |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of Venus Concept Inc. and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated on consolidation. Where the Company does not own 100% of its subsidiaries, it accounts for the partial ownership interest through non-controlling interest. |
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 and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Significant estimates and assumptions made in the accompanying consolidated financial statements include, but are not limited to, the implicit interest rate used to record lease revenue, allowance for doubtful accounts, inventory valuation, stock-based compensation, warranty accrual, the valuation and measurement of deferred tax assets and liabilities, accrued severance pay, useful lives of property and equipment, earn-out liability, useful lives of intangible assets, impairment of long-lived assets and goodwill and valuation of acquired intangible assets and goodwill. The Company evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors and adjusts those estimates and assumptions when facts and circumstances dictate. Actual results could materially differ from those estimates. The Company assessed certain accounting matters that generally require consideration of forecasted financial information in context with the information reasonably available to the Company and the unknown future impacts of COVID-19 December 31 intangible and long-lived assets COVID-19 related December 31 |
Restatement of Comparative Amounts | Restatement of Comparative Amounts Venus Concept Ltd. previously classified the issuance of common stock and preferred stock as a credit to common stock. In accordance with U.S. GAAP, amounts issued in excess of par value are required to be accounted for in additional paid in capital (“APIC”). The error is a reclassification from common stock into APIC and has an overall immaterial impact on the consolidated statement of stockholders’ equity and consolidated balance sheet. Items previously reported have been reclassified to conform to U.S. GAAP and the reclassification did not have any impact on the Company’s consolidated statements of operations, consolidated statements of comprehensive loss, consolidated statements of cash flows and net loss per share calculations. The following table summarizes the impact of the restatement adjustments on Venus Concept Ltd.’s previously reported consolidated financial statements: As previously reported Adjustment As restated $ $ $ Consolidated balance sheet and consolidated statement of stockholders' equity January 1, 2019 Common Stock 57,101 (57,096 ) 5 Additional paid in capital 10,399 57,096 67,495 March 31, 2019 Common Stock 57,108 (57,103 ) 5 Additional paid in capital 10,774 57,103 67,877 June 30, 2019 Common Stock 57,108 (57,103 ) 5 Additional paid in capital 11,818 57,103 68,921 September 30, 2019 Common Stock 57,459 (57,454 ) 5 Additional paid in capital 11,937 57,454 69,391 |
Foreign Currency | Foreign Currency The consolidated financial statements are presented in U.S. dollars. Amounts reported in thousands within this report are computed based on the amounts in dollars. As a result, the sum of the components reported in thousands may not equal the total amount reported in thousands due to rounding. Certain columns and rows within tables may not add due to the use of rounded numbers. Percentages presented are calculated from the underlying numbers in dollars. All exchange gains and losses from remeasurement of monetary balance sheet items resulting from transactions in non-functional currencies are recorded in the consolidated statements of operations as they arise. In respect of transactions denominated in currencies other than the Company and its subsidiaries’ functional currencies, the monetary assets and liabilities are remeasured at the period end rates. Revenue and expenses are remeasured at rates of exchange prevailing on the transaction dates. All of the exchange gains or losses resulting from these transactions are recognized in the consolidated statements of operations. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with an original maturity of three months or less from the date of purchase to be cash equivalents. Cash and cash equivalents consist primarily of funds invested in readily available checking and savings accounts, investments in money market funds and short-term time deposits. |
Restricted Cash | Restricted Cash As of December 31, 2020, and 2019, the Company was required to hold $83 and $83, respectively, in a separate deposit account as collateral for rent and credit cards. |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to a concentration of credit risk consist of cash and cash equivalents, accounts receivable and long-term receivables. The Company’s cash and cash equivalents are invested primarily in deposits with major banks worldwide, as such minimal credit risk exists with respect to such investments. The Company’s trade receivables are derived from global sales to customers. An allowance for doubtful accounts is provided with respect to all balances for which collection is deemed to be doubtful. |
Risks and Uncertainties | Risks and Uncertainties The Company has considered the impact of COVID-19 on its consolidated financial statements. COVID-19 has had a significant negative impact on the Company’s consolidated financial statements as of December 31 , 2020 and for the year then ended, and management expects the pandemic to continue to have a negative impact in the foreseeable future, the extent of which is uncertain and largely subject to whether the severity of the pandemic worsens, or duration lengthens. These impacts could include, but may not be limited to, risks and uncertainties related to the ability of the Company’s sales and marketing personnel and distributors to access the Company’s customer base, disruptions to the Company’s global supply chain, reduced demand and/or suspension of operations by the Company’s subscription customers which could impact their ability to make monthly payments, or deferral of aesthetic or hair restoration procedures which would impact the Company’s revenues. may subject the Company to future risk of material intangible and long-lived assets impairments, increased reserves for uncollectible accounts, and adjustments for inventory and market volatility for items subject to fair value measurements. Besides COVID-19 , t The Company has borrowings with interest rates that are subject to fluctuations as charged by the lender. The Company does not use derivative financial instruments to mitigate the exposure to interest rate risk. The Company’s objective is to have sufficient liquidity to meet its liabilities when due. The Company monitors its cash balances and cash used in operating activities to meet its requirements. As of December 31, 2020 and 2019, the most significant financial liabilities are the line of credit, trade payables, accrued expenses and other current liabilities and long-term debt. |
Concentration of Customers | Concentration of Customers For the years ended December 31, 2020 and 2019, there were no customers accounting for more than 10% of the Company’s revenue. As of December 31, 2020 and 2019, there were no customers accounting for more than 10% of the Company’s accounts receivable. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts Trade accounts receivable do not bear interest and are typically not collateralized. The Company performs ongoing credit evaluations of its customers’ financial condition and maintains an allowance for doubtful accounts. Uncollectible accounts are charged to expense when deemed uncollectible, and accounts receivable are presented net of an allowance for doubtful accounts. Accounts receivable are deemed past due in accordance with the contractual terms of the agreement. Actual The allowance for doubtful accounts consisted of the following activity for years ended December 31, 2020 and 2019 (in thousands): As of December 31, 2020 2019 Balance at beginning of year $ 10,494 $ 4,408 Write-offs (6,536 ) (3,905 ) Provision 15,212 9,991 Sale of subsidiaries (680 ) - Balance at end of year $ 18,490 $ 10,494 |
Inventory | Inventory Inventories are stated at the lower of cost or net realizable value and include raw materials, work in progress and finished goods. Cost is determined as follows: Raw Materials and Work in Progress (“WIP”) – Cost is determined on a standard cost basis utilizing the weighted average cost of historical purchases, which approximates actual cost. The cost of WIP and finished goods includes the cost of raw materials and the applicable share of the cost of labor and fixed and variable production overheads. The Company regularly evaluates the value of inventory based on a combination of factors including the following: historical usage rates, product end of life dates, technological obsolescence and product introductions. The Company includes demonstration units within inventories. Proceeds from the sale of demonstration units are recorded as revenue. |
Long-term Receivables | Long-term Receivables Long-term receivables relate to the Company’s subscription revenue or contracts which stipulate payment terms which exceed one year. They are comprised of the unpaid principal balance, plus accrued interest, net of the allowance for credit losses. These receivables have been discounted based on the implicit interest rate in the subscription lease which range between 8% to 9% in 2020 and 8% to 9% in 2019. Unearned interest revenue represents the interest only portion of the respective subscription payments and will be recognized in income over the respective payment term as it is earned. Deferred revenues represent payments received prior to the income being earned. Once the equipment has been delivered or the services have been rendered, these amounts are recognized in income. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which is between three and ten years. Leasehold improvements are depreciated over the lesser of the life of the lease or the useful life of the improvements. Maintenance and repairs are charged to expense as incurred. When assets are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the consolidated balance sheets, and any resulting gain or loss is reflected in the consolidated statements of operations. |
Intangible Assets | Intangible Assets Intangible assets consist of customer relationships, brand, technology and supplier agreement. Intangible assets are stated at cost less accumulated amortization. Amortization is computed using the straight-line method over the estimated useful lives of the respective assets, which range from approximately six to fifteen years. The useful lives of intangible assets are based on the Company’s assessment of various factors impacting estimated cash flows, such as the product’s position in its lifecycle, the existence or absence of like products in the market, various other competitive and regulatory issues, and contractual terms. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company accounts for the impairment of long-lived assets in accordance with FASB, Accounting Standards Codification (“ASC”) 360-10, “Accounting for the Impairment of Long-Lived Assets”. This standard requires that long-lived assets be reviewed for impairment whenever events or changes in circumstances indicate that the assets’ carrying amounts may not be recoverable. For assets that are to be held and used, impairment is assessed when the estimated undiscounted cash flows associated with the asset or group of assets is less than their carrying values. If impairment exists, an adjustment is made to write the asset down to its fair value, and a loss is recorded as the difference between the carrying value and fair value. Fair values are determined based on quoted market values, discounted cash flows or internal and external appraisals, as applicable. Assets to be disposed of are carried at the lower of carrying value and estimated net realizable value. During the years ended December 31, 2020 and 2019, there was no impairment of long-lived assets. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price of the business acquired over the fair value of the net identifiable assets of an acquired business. The Company allocates goodwill to reporting units at the time of acquisition or when there is a change in the reporting structure and bases that allocation on which reporting units will benefit from the acquired assets and liabilities. Reporting units are defined as operating segments or one level below an operating segment, referred to as a component. Goodwill is not amortized but is tested for impairment annually or more frequently when an event occurs, or circumstances change that indicate the carrying value may not be recoverable. The carrying values of goodwill and indefinite-life intangible assets are subject to annual impairment assessment as of the last day of each fiscal year. Between annual assessments, impairment review may also be triggered by any significant events or changes in circumstances affecting the Company’s business. The COVID-19 pandemic had significantly impacted the Company’s business during the first three months of 2020, including its sales, supply chain, manufacturing and accounts receivable collections. As a result, the Company considered the COVID-19 pandemic as a triggering event and conducted quantitative impairment assessment of its goodwill as of March 31, 2020. The Company has one reporting unit and the reporting unit’s carrying value was compared to its estimated fair value. As of March 31, 2020, the Company estimated its fair value using a combination of income approach and market approach. The income approach is based on the present value of future cash flows, which are derived from long term financial forecasts, and requires significant assumptions including among others, a discount rate and a terminal value. The market approach is based on the observed ratios of enterprise value to revenue multiples of the Company and other comparable publicly traded companies. Based upon the results of the goodwill impairment assessment, the Company recorded an impairment charge of $27,450 as of March 31, 2020, which represented the full balance of goodwill for the reporting unit. Based on the analysis of the intangible assets and long-lived assets as of December 31, 2020, |
Debt Issuance Costs | Debt Issuance Costs Costs related to the issuance of debt are presented as a direct deduction to the carrying value of the debt and are amortized to accretion expenses using the effective interest rate method over the term of the related debt. |
Derivatives | Derivatives The Company reviews the terms of convertible notes, equity instruments and other financing arrangements to determine whether there are embedded derivative instruments, including embedded conversion options that are required to be bifurcated and accounted for separately as a derivative financial instrument. Derivative financial instruments are initially measured at their fair value. Derivative financial instruments that are accounted for as liabilities, are initially recorded at fair value and then re-valued at each reporting date, with changes in the fair value recognized in the consolidated statements of operations. |
Revenue Recognition | Revenue Recognition The Company adopted Accounting Standards Codification (“ASC”) 606 “Revenue from contract with customers” The Company generates revenue from (1) sales of systems through the subscription model, traditional system sales to customers and distributors, (2) other product revenues from the sale of marketing supplies and kits, consumables and Venus Concept’s skincare and hair products and (3) service revenue from the sale of VeroGrafters ™ Many of the Company’s products are sold under subscription contracts with control passing to the customer at the earlier of the end of the term and when the payment is received in full. The subscription contracts include an initial deposit followed by monthly installments typically over a period of 36 months. In accordance with ASC 840 “Leases” (“ASC 840”), these arrangements are considered to be sales-type leases, where the present value of all cash flows to be received within the arrangement is recognized upon shipment to the customer and achievement of the required revenue recognition criteria. Various accounting and reporting systems are used to monitor subscription receivables which include providing access codes to operate the machines to paying customers and restricting access codes on machines to non-paying customers The Company recognizes revenues on other products and services in accordance with ASC 606. Revenue is recognized based on the following five steps: (1) identification of the contract(s) with the customer; (2) identification of the performance obligations in the contract; (3) determination of the transaction price; and (4) allocation of the transaction price to the separate performance obligations in the contract; and (5) recognition of revenue when (or as) the entity satisfies a performance obligation. The Company does not grant rights of return to its end customers. The Company’s products sold through arrangements with distributors are non-refundable, non-returnable and without any rights of price protection. The Company records revenue net of sales tax and shipping and handling costs. |
Cost of Goods | Cost of Goods For subscription sales (qualifying as sales-type lease arrangements) and product sales, the costs are recognized upon shipment to the customer or distributor. |
Advertising Costs | Advertising Costs The cost of advertising and media is expensed as incurred. For the years ended December 31, 2020 and 2019, advertising costs totaled $1,092 and $2,004, respectively. |
Research and Development | Research and Development Research and development costs are charged to operations as incurred. Major components of research and development expenses consist of personnel costs, including salaries and benefits, hardware and software research and development costs, regulatory affairs, and clinical costs. |
Warranty | Warranty The Company provides a standard warranty against defects for all of its systems. The warranty period begins upon shipment and is typically for a period between one and three years. The Company records a liability for accrued warranty costs at the time of sale of a system, which consists of the warranty on products sold based on historical warranty costs and management’s estimates. The Company periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts thereof as necessary. The Company also provides an extended warranty service. Extended warranty can be purchased at any time after the purchase of a system and prior to the expiration of the standard warranty provided with the sale of the system. Extended warranty services include standard warranty services. The Company recognizes the revenue from the sale of an extended warranty over the period of the extended warranty and accounts it for separately from the standard warranty. |
Income Taxes | Income Taxes The Company follows the deferred income taxes method of accounting for income taxes. Under this method, deferred income taxes are recognized for the future tax consequences attributable to differences between the financial statement carrying values of accounts and their respective income tax basis. Deferred income tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years during which the temporary differences are expected to be realized or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is included in income in the period that includes the enactment date. The Company establishes valuation allowances when necessary to reduce deferred tax assets to the amounts that are more likely than not to be realized. The Company evaluates tax positions taken or expected to be taken in the course of preparing tax returns to determine whether the tax positions have met a “more likely-than-not” threshold of being sustained by the applicable tax authority. Tax benefits related to tax positions not deemed to meet the “more likely-than-not” threshold are not permitted to be recognized in the consolidated financial statements. Uncertain Tax Positions The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained on examination based on the technical merit of the position. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on examination, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount, which is more than 50% likely of being realized upon ultimate settlement. The Company considers many factors when evaluating and estimating its tax positions and tax benefits, which may require periodic adjustments. The Company recognizes interest charges and penalties related to unrecognized tax benefits as a component of the tax provision and recognizes interest charges and penalties related to recognized tax positions in the accompanying consolidated statements of operations. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718, “Compensation – Stock Compensation” (“ASC 718”). ASC 718 requires companies to estimate the fair value of equity-based payment awards on the date of grant. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service period in the Company’s consolidated statements of operations. The fair value of stock options (“options”) on the grant date is estimated using the Black-Scholes option-pricing model using the single-option approach. The Black-Scholes option pricing model requires the use of highly subjective and complex assumptions, including the option’s expected term and the price volatility of the underlying stock, to determine the fair value of the award. The Company recognizes compensation expenses for the value of its awards granted based on the straight-line method over the requisite service period of each of the awards. The Company has made a policy choice to account for forfeitures when they occur. Stock options granted to non-employees are based on the fair value on the grant date and re-measured at the end of each reporting period based on the fair value until the earlier of the options being fully vested and completion of the performance obligations. These are subject to a service vesting condition and are recognized on a straight-line method over the requisite service period. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Estimated forfeitures are based on historical pre-vesting forfeitures. |
Net Loss Per Share | Net Loss Per Share The Company computes net (loss) income per share in accordance with ASC Topic 260, “Earnings Per Share” (“ASC 260”) and related guidance, which requires two calculations of net (loss) income attributable to the Company’s shareholders per share to be disclosed: basic and diluted. Convertible preferred shares are participating securities and are included in the calculation of basic and diluted net (loss) income per share using the two-class method. In periods where the Company reports net losses, such losses are not allocated to the convertible preferred shares for the computation of basic or diluted net (loss) income. Diluted net (loss) income per share is the same as basic net (loss) income per share for the periods in which the Company had a net loss because the inclusion of outstanding common stock equivalents would be anti-dilutive. |
Jobs Act Accounting Election | JOBS Act Accounting Election The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it is (i) no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, these consolidated financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates. |
Recently Issued Accounting Standards Not Yet Adopted | Recently Issued Accounting Standards Not Yet Adopted In April 2020, Financial Accounting Standards Board (the “FASB”) issued a Staff Question-and-Answer Document (Q&A): ASC Topic 842 and ASC Topic 840: Accounting for Lease Concessions Related to the Effects of the COVID-19 Pandemic, that focuses on the application of the lease guidance for lease concessions related solely to the effects of COVID-19. The FASB issued the guidelines to reduce the burden and complexity for companies to account for such lease concessions (e.g., rent abatements or other economic incentives) under current lease accounting rules due to COVID-19 by providing certain practical expedients that can be used. This guidance can be applied immediately. The Company anticipates that the adoption of the guidance will not have a material impact on the Company’s consolidated financial statements. In March 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-04 - Facilitation of the Effects of Reference Rate Reform on Financial Reporting (ASC Topic 848). This authoritative guidance provides optional relief for companies preparing for the discontinuation of interest rates such as LIBOR, which is expected to be phased out at the end of calendar 2021, and applies to lease contracts, hedging instruments, held-to-maturity debt securities and debt arrangements that have LIBOR as the benchmark rate. This guidance can be applied for a limited time, as of the beginning of the interim period that includes March 12, 2020 or any date thereafter, through December 31, 2022. The guidance may no longer be applied after December 31, 2022. In January 2021, the FASB issued authoritative guidance that makes amendments to the new rules on accounting for reference rate reform. The amendments clarify that all derivative instruments affected by the changes to interest rates used for discounting, margining or contract price alignment, regardless of whether they reference LIBOR, or another rate expected to be discontinued as a result of reference rate reform, an entity may apply certain practical expedients in ASC Topic 848. The Company is currently assessing the impact of applying this guidance as well as when to adopt this guidance. In February 2020, the FASB issued authoritative guidance (ASU 2020-02 – Financial Instruments – Credit Losses (Topic 326) and Leases (Topic 842)) that amends and clarifies Topic 326 and Topic 842. For Topic 326, the codification was updated to include the SEC staff interpretations associated with registrants engaged in lending activities. ASC Topic 326 is effective for annual periods beginning after January 1, 2023, including interim periods within those fiscal years. The Company is currently evaluating the impact of applying this guidance on its financial instruments, such as accounts receivable. In December 2019, the FASB issued ASU 2019-12 – Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, an authoritative guidance that simplifies the accounting for income taxes by removing certain exceptions and making simplifications in other areas. It is effective from the first quarter of fiscal year 2022, with early adoption permitted in any interim period. If adopted early, the Company must adopt all the amendments in the same period. The amendments have differing adoption methods including retrospectively, prospectively and/or modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption, depending on the specific change. The Company is currently evaluating the impact of applying this guidance and believes that it has transactions that may fall under the scope of this guidance. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Restatement Adjustments on Previously Reported Consolidated Financial Statements | The following table summarizes the impact of the restatement adjustments on Venus Concept Ltd.’s previously reported consolidated financial statements: As previously reported Adjustment As restated $ $ $ Consolidated balance sheet and consolidated statement of stockholders' equity January 1, 2019 Common Stock 57,101 (57,096 ) 5 Additional paid in capital 10,399 57,096 67,495 March 31, 2019 Common Stock 57,108 (57,103 ) 5 Additional paid in capital 10,774 57,103 67,877 June 30, 2019 Common Stock 57,108 (57,103 ) 5 Additional paid in capital 11,818 57,103 68,921 September 30, 2019 Common Stock 57,459 (57,454 ) 5 Additional paid in capital 11,937 57,454 69,391 |
Summary of Allowance for Doubtful Accounts | The allowance for doubtful accounts consisted of the following activity for years ended December 31, 2020 and 2019 (in thousands): As of December 31, 2020 2019 Balance at beginning of year $ 10,494 $ 4,408 Write-offs (6,536 ) (3,905 ) Provision 15,212 9,991 Sale of subsidiaries (680 ) - Balance at end of year $ 18,490 $ 10,494 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Loss and Weighted Average Number of Shares Used in Computing Basic and Diluted Net Loss Per Share | The following table sets forth the computation of basic and diluted net loss and the weighted average number of shares used in computing basic and diluted net loss per share (in thousands, except per share data): For the year ended December 31, 2020 2019 Numerator: Net loss $ (82,818 ) $ (42,295 ) Net loss allocated to stockholders of the Company $ (85,270 ) $ (40,619 ) Denominator: Weighted-average shares of common stock outstanding used in computing net loss per share, basic and diluted 36,626 8,517 Net loss per share: Basic and diluted $ (2.33 ) $ (4.77 ) |
Outstanding Shares of Common Stock Equivalents Excluded from Calculation of Diluted Net Loss per Share Attributable to Common Stockholders | Due to the net loss, all the outstanding shares of common stock equivalents were excluded from the calculation of diluted net loss per share attributable to common stockholders for the years ended December 31, 2020 and 2019 because including them would have been antidilutive : December 31, 2020 2019 Options to purchase common stock 2,593,711 2,727,764 Warrants for common stock 16,290,067 3,990,067 Total potential dilutive shares 18,883,778 6,717,831 |
Fair Value Measurements - (Tabl
Fair Value Measurements - (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Level 2 and Level 3 Financial Assets and Liabilities | The Company classifies its restricted cash and guaranteed investment certificates within Level 2 as it uses alternative pricing sources and models utilizing market observable inputs. Contingent earn-out consideration is classified within Level 3. The following tables set forth the fair value of the Company’s Level 2 and Level 3 financial assets and liabilities within the fair value hierarchy: Fair Value Measurements as of December 31, 2020 Quoted Prices in Active Markets using Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets Guaranteed Investment Certificates ("GIC") $ — $ 64 $ — $ 64 Restricted cash — 83 — 83 Total assets $ — $ 147 $ — $ 147 Liabilities Contingent earn-out consideration — — 147 147 Total liabilities $ — $ — $ 147 $ 147 Fair Value Measurements as of December 31, 2019 Quoted Prices in Active Markets using Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets Guaranteed Investment Certificates ("GIC") $ — $ 63 $ — $ 63 Restricted cash — 83 — 83 Total assets $ — $ 146 $ — $ 146 Liabilities Contingent earn-out consideration — — 655 655 Total liabilities $ — $ — $ 655 $ 655 |
Schedule Aggregate Fair Values of Earn-out Liability | The following table provides a roll forward of the aggregate fair values of the earn-out liability as of December 31, 2020, for which fair value is determined using Level 3 inputs: Beginning balance $ 950 Payments (828 ) Change in value 533 December 31, 2019 655 Payments (799 ) Change in value 291 December 31, 2020 $ 147 |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Receivables [Abstract] | |
Summary of Accounts Receivables | A summary of the Company’s accounts receivables is presented as follows: As of December 31, 2020 2019 Gross accounts receivable $ 92,402 $ 105,127 Unearned income (3,728 ) (5,623 ) Allowance for doubtful accounts (18,490 ) (10,494 ) $ 70,184 $ 89,010 Reported as: Current trade receivables $ 52,764 $ 58,977 Current unearned interest income (1,950 ) (3,942 ) Long-term trade receivables 21,148 35,656 Long-term unearned interest income (1,778 ) (1,681 ) $ 70,184 $ 89,010 |
Schedule of Contractual Commitments, Net of Allowance for Doubtful Accounts | The following are the contractual commitments, net of allowance for doubtful accounts, to be received by the Company over the next 5 years: December 31, Total 2021 2022 2023 2024 2025 Current financing receivables, net of allowance of $7,190 $ 27,948 $ 27,948 $ — $ — $ — $ — Long-term financing receivables, net of allowance of $4,915 21,148 — 16,076 5,001 71 — $ 49,096 $ 27,948 $ 16,076 $ 5,001 $ 71 $ — |
Select Balance Sheet and Stat_2
Select Balance Sheet and Statement of Operations Information (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Select Balance Sheet And Income Statement Information [Abstract] | |
Schedule of Inventory | Inventory December 31, 2020 2019 Raw materials $ 838 $ 877 Work-in-progress 1,232 2,067 Finished goods 15,689 15,900 Total inventory $ 17,759 $ 18,844 |
Schedule of Property and Equipment, Net | Property December 31, Useful Lives (in years) 2020 2019 Lab equipment tooling and molds 4 - 10 $ 8,053 $ 7,872 Office furniture and equipment 6 - 10 1,760 1,710 Leasehold improvements up to 10 1,838 1,950 Computers and software 3 1,815 1,811 Vehicles 5 - 7 12 16 Total property and equipment 13,478 13,359 Less: Accumulated depreciation (9,939 ) (8,711 ) Total property and equipment, net $ 3,539 $ 4,648 |
Schedule of Other Current Assets | December 31, 2020 2019 Government remittances (1) $ 1,009 $ 1,704 Consideration receivable from subsidiaries sale 2,580 - Deferred financing costs 1,063 - Sundry assets and miscellaneous 1,022 1,397 Total other current assets $ 5,674 $ 3,101 (1) Government remittances are receivables from the local tax authorities for refund of sales taxes and income taxes. |
Schedule of Accrued Expenses and Other Current Liabilities | December 31, 2020 2019 Payroll and related expense $ 1,312 $ 3,117 Accrued expenses 8,582 10,645 Commission accrual 2,827 4,215 Sales and consumption taxes 7,532 3,143 Total accrued expenses and other current liabilities $ 20,253 $ 21,120 |
Schedule of Change in Warranty Accrual | The following table provides the details of the change in the Company’s warranty accrual: December 31, 2020 2019 Balance as of the beginning of the year $ 1,977 $ 1,336 Warranties assumed through business combination - 273 Warranties issued during the year 761 1,038 Warranty costs incurred during the year (1,099 ) (670 ) Balance at the end of the year $ 1,639 $ 1,977 Current 1,106 1,254 Long-term 533 723 Total $ 1,639 $ 1,977 |
Schedule of Finance Expenses | The following table provides the details of the Company’s finance expenses: December 31, 2020 2019 Interest expense $ 7,615 $ 7,166 Gain on settlement of debt — (297 ) Accretion on long-term debt 728 680 Total finance expenses $ 8,343 $ 7,549 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets Net of Accumulated Amortization | Intangible assets net of accumulated amortization were as follows: At December 31, 2020 Gross Amount Accumulated Amortization Net Amount Customer relationships $ 1,400 $ (242 ) $ 1,158 Brand 2,500 (540 ) 1,960 Technology 16,900 (3,286 ) 13,614 Supplier agreement 3,000 (867 ) 2,133 Total intangible assets $ 23,800 $ (4,935 ) $ 18,865 At December 31, 2019 Gross Amount Accumulated Amortization Net Amount Customer relationships $ 1,400 $ (149 ) $ 1,251 Brand 2,500 (276 ) 2,224 Technology 16,900 (469 ) 16,431 Supplier agreement 3,000 (568 ) 2,432 Total intangible assets $ 23,800 $ (1,462 ) $ 22,338 |
Schedule of Estimated Amortization Expense | Estimated amortization expense for the next five fiscal years and all years thereafter are as follows: Years ending December 31, 2021 $ 3,473 2022 3,473 2023 3,473 2024 3,473 2025 3,473 Thereafter 1,500 Total $ 18,865 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Summary of Future Minimum Lease Payments and Purchase Commitments with Manufacturers | Aggregate future minimum lease payments and purchase commitments with manufacturers as of December 31, 2020 are as follows: Years ending December 31, Office Lease Purchase Commitments Total 2021 $ 1,701 $ 7,309 $ 9,010 2022 681 — 681 2023 277 — 277 2024 199 — 199 2025 204 204 Thereafter 994 — 994 Total $ 4,056 $ 7,309 $ 11,365 |
Madryn Long-term Debt and Con_2
Madryn Long-term Debt and Convertible Notes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule Principal Payments on Outstanding Borrowings | The scheduled payments on the outstanding borrowings as of December 31, 2020 are as follows: As of December 31, 2020 2021 $ 2,136 2022 2,136 2023 2,102 2024 1,606 2025 28,196 Total $ 36,176 |
Common Stock Reserved For Iss_2
Common Stock Reserved For Issuance (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Schedule of Common Stock Reserved for Issuance | The Company is required to reserve and keep available out of its authorized but unissued shares of Common Stock a number of shares sufficient to affect the conversion of all outstanding shares of convertible preferred stock, plus options granted and available for grant under the incentive plans. December 31, 2020 December 31, 2019 Outstanding common stock warrants 16,290,067 3,990,067 Outstanding stock options 4,433,392 3,278,439 Shares reserved for future option grants 262,622 742,828 Shares reserved for Lincoln Park 5,222,867 — Shares reserved for Madryn Noteholders 8,213,880 — Total common stock reserved for issuance 34,422,828 8,011,334 |
Stockholders Equity (Tables)
Stockholders Equity (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Summary of Recognized Stock-based Compensation Expense for Employees and Non-employees | The Company recognized stock-based compensation for its employees and non-employees in the accompanying consolidated statements of operations as follows: Year Ended December 31, 2020 2019 Cost of sales $ 25 $ 3 Selling and marketing 872 840 General and administrative 1,151 1,238 Research and development 90 77 Total stock-based compensation $ 2,138 $ 2,158 |
Assumptions used in Fair Value of Option Estimated at Date of Grant using Black-Scholes-Merton Option Pricing Formula | The fair value of each option is estimated at the date of grant using the Black-Scholes option pricing formula with the following assumptions : Year Ended December 31, 2020 2019 Expected term (in years) 6.00-6.54 4.00-5.00 Risk-free interest rate 0.38-1.5% 1.4-2.53% Expected volatility 42.83% 49.00% Expected dividend rate 0% 0% |
Summary of Stock Option Activity | The following table summarizes stock option activity under the Company’s stock option plan: Number of Shares Weighted- Average Exercise Price per Share, $ Weighted- Average Remaining Contractual Term Aggregate Intrinsic Value Outstanding – January 1, 2020 3,278,439 5.29 5.08 $ 4,885 Options granted 1,978,000 4.17 - Options exercised (469,754 ) 2.45 464 Options forfeited/cancelled (353,293 ) 13.76 1 Outstanding - December 31, 2020 4,433,392 4.59 6.20 $ 247 Exercisable – December 31, 2020 2,593,711 4.40 4.32 $ 247 Expected to vest – after December 31, 2020 1,839,681 3.70 7.61 $ - |
Summary of Information about Share Options Outstanding and Exercisable | The following tables summarize information about share options outstanding and exercisable on December 31, 2020: Options Outstanding Options Exercisable Exercise Price Range Number Weighted average remaining contractual term (years) Weighted average Exercise Price Options exercisable Weighted average remaining contractual term (years) Weighted average Exercise Price $0.15 - $3.64 2,878,185 6.01 $ 3.05 1,643,103 3.62 $ 2.71 $4.26 - $7.95 1,498,383 6.57 6.78 909,832 5.50 6.42 $12.45 - $26.10 35,011 7.58 18.45 19,638 7.45 18.89 $27.00 - $33.00 12,998 3.85 27.99 12,954 3.84 27.98 $36.00 - $94.65 8,815 6.37 46.14 8,184 6.37 45.41 4,433,392 6.20 $ 4.59 2,593,711 4.32 $ 4.40 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Geographical Breakdown of Loss Before Income Taxes | The geographical breakdown of loss before income taxes is as follows: Year Ended December 31, 2020 2019 United States $ (63,259 ) $ (23,194 ) Other jurisdictions (18,378 ) (17,244 ) Loss before income taxes $ (81,637 ) $ (40,438 ) |
Schedule of Components of Provision for Income Taxes | The components of the provision for income taxes are as follows: Year Ended December 31, 2020 2019 Current tax provision: Federal $ — $ — Foreign 1,619 2,989 Total current tax provision 1,619 2,989 Deferred tax benefit: Federal — — Foreign (438 ) (1,132 ) Total deferred tax benefit $ (438 ) $ (1,132 ) Total provision for income taxes $ 1,181 $ 1,857 |
Reconciliation between Income Taxes Computed at Federal Statutory Income Tax Rate and Provision for Income Taxes | The reconciliation between income taxes computed at the federal statutory income tax rate and the provision for income taxes is as follows Year Ended December 31, 2020 2019 Loss before income taxes $ (81,637 ) $ (40,438 ) Theoretical tax benefit at the statutory rate (21.0% in 2020, 23.9% in 2019) (17,144 ) (9,665 ) Differences in jurisdictional tax rates (2,817 ) (337 ) Recognition of losses — (1,923 ) Valuation allowance 12,416 12,343 Non-deductible expenses 8,080 2,217 Other 646 (778 ) Total income tax provision 1,181 1,857 Net loss $ (82,818 ) $ (42,295 ) |
Schedule of Components of Deferred Tax Assets and Deferred Tax Liabilities | The components of the deferred tax assets and deferred tax liabilities are as follows: December 31, 2020 2019 Deferred tax assets: Property and equipment $ 735 $ 81 Deferred revenue 2,065 101 Allowance for doubtful accounts 2,670 440 Intangible assets (2,554 ) — Non-deductible expenses 8,350 — Warranty and other reserves 729 — Other 114 — Loss carryforwards 71,362 56,154 Valuation allowance (82,587 ) (56,154 ) Total deferred tax assets $ 884 $ 622 Deferred tax liabilities: Deferred revenue $ 811 $ 1,017 Total deferred tax liabilities $ 811 $ 1,017 |
Schedule of Reconciliation of Uncertain Tax Position | The activity related to gross amount of unrecognized tax benefits is as follows: Year Ended December 31, 2020 2019 Balance as of the beginning of the year $ 1,467 $ 1,467 Increases related to tax positions in prior period 57 — Increases related to tax positions taken during the current period 60 — Balance at the end of the year $ 1,584 $ 1,467 |
Schedule of Tax Effected Amount of Recognized Tax Position | The activity related to the tax effected amount of the recognized tax position as follows: Year Ended December 31, 2020 2019 Balance as of the beginning of the year $ - $ - Increases related to tax positions in prior period (369 ) — Increase related to interest expense (109 ) — Balance at the end of the year $ (478 ) $ - |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Revenue by Geographic Area | Revenue by geographic location, which is based on the product shipped to location, is summarized as follows: Year Ended December 31, 2020 2019 United States $ 33,987 $ 47,723 International 44,027 62,683 Total revenue $ 78,014 $ 110,406 |
Schedule of Revenue by Type | The following table presents revenue by type: Year Ended December 31, 2020 2019 Lease revenue $ 33,428 $ 65,170 System revenue 28,957 31,730 Product revenue 10,858 6,943 Service revenue 4,771 6,563 Total revenue $ 78,014 $ 110,406 |
Nature of Operations - Addition
Nature of Operations - Additional Information (Details) | Dec. 22, 2020USD ($)$ / sharesshares | Jun. 16, 2020USD ($)$ / sharesshares | Mar. 19, 2020USD ($)$ / sharesshares | Nov. 07, 2019shares | Dec. 31, 2020USD ($)$ / sharesshares | Mar. 31, 2020USD ($)shares | Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares |
Nature Of Operations [Line Items] | ||||||||
Accumulated deficit | $ 157,392,000 | $ 157,392,000 | $ 75,686,000 | |||||
Net proceeds from private placement | $ 20,476,000 | $ 20,300,000 | ||||||
Net proceeds from shares issuance | $ 8,390,000 | |||||||
Common stock, shares issued | shares | 53,551,126 | 53,551,126 | 28,686,116 | |||||
Common stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||
Cash financing fees, net | $ 1,229,000 | $ 1,229,000 | ||||||
Gross proceeds from stock issuance | 20,475,000 | |||||||
Gain (loss) on disposal transaction | (2,526,000) | (2,526,000) | ||||||
Common Stock | ||||||||
Nature Of Operations [Line Items] | ||||||||
Net proceeds from private placement | $ 4,052,000 | |||||||
Preferred stock convertible into common stock | shares | 6,600,000 | |||||||
Private Placement | ||||||||
Nature Of Operations [Line Items] | ||||||||
Net proceeds from private placement | 20,300,000 | |||||||
Stock, issuance costs | $ 1,951,000 | |||||||
December 2020 Public Offering Warrants | ||||||||
Nature Of Operations [Line Items] | ||||||||
Net proceeds from shares issuance | $ 2,648,000 | |||||||
Merger Agreement | ||||||||
Nature Of Operations [Line Items] | ||||||||
Right to number of shares to be received in exchange of each outstanding ordinary and preferred share | shares | 8.6506 | |||||||
Investors | December 2020 Public Offering | ||||||||
Nature Of Operations [Line Items] | ||||||||
Common stock, par value | $ / shares | $ 0.0001 | |||||||
Common stock, shares issued | | shares | 11,250,000 | |||||||
Combined offering price per share | $ / shares | $ 2 | |||||||
Gross proceeds from stock issuance | $ 22,500,000 | |||||||
Stock, issuance costs | $ 2,024,000 | |||||||
Investors | December 2020 Public Offering Warrants | ||||||||
Nature Of Operations [Line Items] | ||||||||
Exercise price of warrants | $ / shares | $ 2.50 | |||||||
Warrants expiry period | 5 years | |||||||
Investors | Securities Purchase Agreement | ||||||||
Nature Of Operations [Line Items] | ||||||||
Common stock, shares issued | shares | 2,300,000 | |||||||
Common stock, par value | $ / shares | $ 0.0001 | |||||||
Warrants expiry period | 5 years | |||||||
Warrants exercisable period | beginning 181 days after their issue date | |||||||
Investors | Securities Purchase Agreement | Series A Convertible Preferred Stock | ||||||||
Nature Of Operations [Line Items] | ||||||||
Preferred stock, shares issued | shares | 660,000 | 660,000 | 660,000 | |||||
Preferred stock, par value | $ / shares | $ 0.0001 | |||||||
Investors | Securities Purchase Agreement | Series A Convertible Preferred Stock | Common Stock | ||||||||
Nature Of Operations [Line Items] | ||||||||
Preferred stock convertible into common stock | shares | 6,600,000 | 6,600,000 | ||||||
Investors | Securities Purchase Agreement | Private Placement | ||||||||
Nature Of Operations [Line Items] | ||||||||
Net proceeds from shares issuance | $ 22,250,000 | |||||||
Warrants to purchase shares of common stock | shares | 6,675,000 | |||||||
Exercise price of warrants | $ / shares | $ 3.50 | |||||||
Cash financing fees, net | $ 1,950,000 | |||||||
Equity Purchase Agreement | Lincoln Park | ||||||||
Nature Of Operations [Line Items] | ||||||||
Net proceeds from shares issuance | $ 8,390,000 | |||||||
Equity purchase agreement term | 2 years | |||||||
Common stock, shares issued | shares | 3,037,087 | 3,037,087 | ||||||
Common stock, par value | $ / shares | $ 0.0001 | |||||||
Percentage of common shares outstanding | 19.99% | |||||||
Common stock, average purchase price per share | $ / shares | $ 2.97 | $ 2.97 | ||||||
Commitment shares issued | shares | 209,566 | |||||||
Commitment shares issued, value | $ 620,000 | |||||||
Share issued, issuance costs | $ 123,000 | 123,000 | ||||||
Gross proceeds from common stock issuance | 9,010,000 | |||||||
Gross proceeds from commitment shares | 9,010,000 | |||||||
Amortization of deferred issuance costs | $ 520,000 | $ 520,000 | ||||||
Minimum | Equity Purchase Agreement | Lincoln Park | ||||||||
Nature Of Operations [Line Items] | ||||||||
Common stock, average purchase price per share | $ / shares | $ 3.9755 | |||||||
Common stock, issued and outstanding percentage | 9.99% | |||||||
Maximum | ||||||||
Nature Of Operations [Line Items] | ||||||||
Percentage of operating revenue of disposed subsidiaries of total revenue | 15.00% | |||||||
Maximum | Investors | December 2020 Public Offering Warrants | ||||||||
Nature Of Operations [Line Items] | ||||||||
Warrants to purchase shares of common stock | shares | 5,625,000 | |||||||
Maximum | Equity Purchase Agreement | Lincoln Park | ||||||||
Nature Of Operations [Line Items] | ||||||||
Common stock, aggregate sales price | $ 31,000,000 | |||||||
Aggregate number of shares issuable | shares | 7,763,411 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($)CustomerReportingUnit | Dec. 31, 2019USD ($)Customer |
Summary Of Significant Accounting Policies [Line Items] | |||
Non-controlling interest, description | Company does not own 100% of its subsidiaries, it accounts for the partial ownership interest through non-controlling interest. | ||
Additional allowance for doubtful accounts | $ 11,088,000 | ||
Goodwill impairment | $ 27,450,000 | 27,450,000 | |
Restricted cash | 83,000 | $ 83,000 | |
Impairment of long-lived assets | $ 0 | 0 | |
Number of reporting units | ReportingUnit | 1 | ||
Subscription contracts, installment period | 36 months | ||
Advertising costs | $ 1,092,000 | $ 2,004,000 | |
Effective tax benefit realized upon ultimate settlement | 50.00% | ||
Minimum | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Discounted based implicit interest rate in subscription lease | 8.00% | 8.00% | |
Estimated useful lives of intangible assets | 6 years | ||
Warranty period on systems against defects | 1 year | ||
Minimum | Property and Equipment | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Depreciation and amortization, estimated useful lives of assets | 3 years | ||
Maximum | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Discounted based implicit interest rate in subscription lease | 9.00% | 9.00% | |
Estimated useful lives of intangible assets | 15 years | ||
Warranty period on systems against defects | 3 years | ||
Maximum | Property and Equipment | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Depreciation and amortization, estimated useful lives of assets | 10 years | ||
Customer Concentration Risk | Revenue | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Number of major customers | Customer | 0 | 0 | |
Concentration Risk, Percentage | 10.00% | 10.00% | |
Customer Concentration Risk | Accounts Receivable | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Number of major customers | Customer | 0 | 0 | |
Concentration Risk, Percentage | 10.00% | 10.00% | |
Allowance for doubtful accounts | $ 18,490,000 | $ 10,494,000 | |
Collateral for Rent and Credit Cards | Other Assets | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Restricted cash | $ 83,000 | $ 83,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Summary of Restatement Adjustments on Previously Reported Consolidated Financial Statements (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Jan. 01, 2019 |
Error Corrections And Prior Period Adjustments Restatement [Line Items] | ||||||
Common Stock | $ 26 | $ 5 | $ 5 | $ 24 | $ 5 | $ 5 |
Additional paid in capital | $ 201,598 | 69,391 | 68,921 | $ 149,840 | 67,877 | 67,495 |
As Previously Reported | ||||||
Error Corrections And Prior Period Adjustments Restatement [Line Items] | ||||||
Common Stock | 57,459 | 57,108 | 57,108 | 57,101 | ||
Additional paid in capital | 11,937 | 11,818 | 10,774 | 10,399 | ||
Adjustment | ||||||
Error Corrections And Prior Period Adjustments Restatement [Line Items] | ||||||
Common Stock | (57,454) | (57,103) | (57,103) | (57,096) | ||
Additional paid in capital | $ 57,454 | $ 57,103 | $ 57,103 | $ 57,096 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Summary of Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Accounting Policies [Abstract] | ||
Balance at beginning of year | $ 10,494 | $ 4,408 |
Write-offs | (6,536) | (3,905) |
Provision | 15,212 | 9,991 |
Sale of subsidiaries | (680) | |
Balance at end of year | $ 18,490 | $ 10,494 |
Net Loss Per Share - Computatio
Net Loss Per Share - Computation of Basic and Diluted Net Loss and Weighted Average Number of Shares Used in Computing Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Numerator: | ||
Net loss | $ (82,818) | $ (42,295) |
Net loss allocated to stockholders of the Company | $ (85,270) | $ (40,619) |
Weighted-average number of shares used in per share calculation: | ||
Weighted-average shares of common stock outstanding used in computing net loss per share, basic and diluted | 36,626 | 8,517 |
Net loss per share: | ||
Basic and diluted | $ (2.33) | $ (4.77) |
Net Loss Per Share - Outstandin
Net Loss Per Share - Outstanding Shares of Common Stock Equivalents Excluded from Calculation of Diluted Net Loss per Share Attributable to Common Stockholders (Details) - shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Total potential dilutive shares | 18,883,778 | 6,717,831 |
Options to Purchase Common Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Total potential dilutive shares | 2,593,711 | 2,727,764 |
Warrants for Common Stock | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Total potential dilutive shares | 16,290,067 | 3,990,067 |
Sale of Subsidiaries - Addition
Sale of Subsidiaries - Additional Information (Details) € in Thousands, $ in Thousands | 1 Months Ended | 12 Months Ended | |
Dec. 31, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2020EUR (€) | |
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Gain (loss) on disposal transaction | $ (2,526) | $ (2,526) | |
Maximum | |||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Percentage of total operating revenue of disposed subsidiaries of total revenue | 15.00% | 15.00% | |
PT NeoAsia Medical | |||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Percentage of ownership interest | 90.00% | 90.00% | |
Venus Concept Kazakhstan LLP | Venus Concept Kazakhstan LLP Foundation Agreement | |||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Percentage of ownership interest | 51.00% | 51.00% | |
Gain (loss) on disposal transaction | $ 58 | ||
Inphronics Limited | |||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Percentage of ownership interest | 100.00% | 100.00% | |
Inphronics Limited | PT NeoAsia Medical | |||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Cash consideration | $ 955 | ||
Gain (loss) on disposal transaction | $ (33) | ||
Med Group Consult Ltd | Venus Concept Central Eastern Europe Ltd | |||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Percentage of ownership interest | 51.00% | 51.00% | |
Cash consideration | $ 531 | € 473 | |
Gain (loss) on disposal transaction | $ (387) | ||
Med Group Consult Ltd | Venus Aesthetic LLP | |||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Percentage of ownership interest | 51.00% | 51.00% | |
Cash consideration | $ 400 | ||
Gain (loss) on disposal transaction | $ (579) | ||
Med Group Consult Ltd | Venus Concept Italy S.r.l | |||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Percentage of ownership interest | 51.00% | 51.00% | |
Cash consideration | $ 330 | € 270 | |
Gain (loss) on disposal transaction | $ (547) | ||
Med Group Consult Ltd | Venus Concept RU LLC | |||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Percentage of ownership interest | 51.00% | 51.00% | |
Cash consideration | $ 597 | ||
Gain (loss) on disposal transaction | $ (368) | ||
Med Group Consult Ltd | Venus Concept Singapore Pte. Ltd | |||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Percentage of ownership interest | 55.00% | 55.00% | |
Med Group Consult Ltd | Venus Concept Singapore Pte. Ltd | Venus Concept Vietnam Co., Ltd | |||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Cash consideration | $ 500 | ||
Gain (loss) on disposal transaction | $ (670) |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Fair Value of Level 2 and Level 3 Financial Assets and Liabilities - (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Total assets | $ 147 | $ 146 |
Total liabilities | 147 | 655 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Total assets | 147 | 146 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Total liabilities | 147 | 655 |
Guaranteed Investment Certificates | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Total assets | 64 | 63 |
Guaranteed Investment Certificates | Significant Other Observable Inputs (Level 2) | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Total assets | 64 | 63 |
Restricted Cash | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Total assets | 83 | 83 |
Restricted Cash | Significant Other Observable Inputs (Level 2) | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Total assets | 83 | 83 |
Contingent Earn-out Consideration | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Total liabilities | 147 | 655 |
Contingent Earn-out Consideration | Significant Unobservable Inputs (Level 3) | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Total liabilities | $ 147 | $ 655 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule Aggregate Fair Values of Earn-out Liability - (Details) - Level 3 - Contingent Earn-out Consideration - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Beginning balance | $ 655 | $ 950 |
Payments | (799) | (828) |
Change in value | 291 | 533 |
Ending balance | $ 147 | $ 655 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) $ in Thousands | Jan. 04, 2021 | Nov. 30, 2020 | Dec. 31, 2020 |
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||
Earn out liability payout | $ 500 | ||
Subsequent Event | |||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||
Earn out liability payout | $ 147 | ||
Level 3 | Contingent Earn-out Consideration | |||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||
Annual installment payable | $ 250 |
Accounts Receivable - Additiona
Accounts Receivable - Additional Information (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Accounts Notes and Loans Receivable [Line Items] | |||
Sales-type leases term of lease | 36 months | ||
Allowance for doubtful accounts | $ 18,490 | $ 10,494 | $ 4,408 |
Trade Receivables and Long-term Receivables | |||
Accounts Notes and Loans Receivable [Line Items] | |||
Financing receivables, consisting of sales-type leases | $ 49,096 | $ 72,602 |
Accounts Receivable - Summary o
Accounts Receivable - Summary of Accounts Receivables (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Accounts Notes and Loans Receivable [Line Items] | |||
Gross accounts receivable | $ 92,402 | $ 105,127 | |
Unearned income | (3,728) | (5,623) | |
Allowance for doubtful accounts | (18,490) | (10,494) | $ (4,408) |
Net accounts receivable | 70,184 | 89,010 | |
Current trade receivables | 52,764 | 58,977 | |
Current unearned interest income | (1,950) | (3,942) | |
Long-term receivables | 21,148 | 35,656 | |
Long-term unearned interest income | (1,778) | (1,681) | |
Trade Accounts Receivable | |||
Accounts Notes and Loans Receivable [Line Items] | |||
Current trade receivables | 52,764 | 58,977 | |
Long-term receivables | $ 21,148 | $ 35,656 |
Accounts Receivable - Schedule
Accounts Receivable - Schedule of Contractual Commitments, Net of Allowance for Doubtful Accounts (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Accounts Notes and Loans Receivable [Line Items] | |
Total financing receivables | $ 49,096 |
2021 | 27,948 |
2022 | 16,076 |
2023 | 5,001 |
2024 | 71 |
Current financing receivables, net of allowance of $6,863 | |
Accounts Notes and Loans Receivable [Line Items] | |
Total financing receivables | 27,948 |
2021 | 27,948 |
Long-term financing receivables, net of allowance of $4,524 | |
Accounts Notes and Loans Receivable [Line Items] | |
Total financing receivables | 21,148 |
2022 | 16,076 |
2023 | 5,001 |
2024 | $ 71 |
Accounts Receivable - Schedul_2
Accounts Receivable - Schedule of Contractual Commitments, Net of Allowance for Doubtful Accounts (Parenthetical) (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Receivables [Abstract] | |
Allowance for current financing receivables | $ 7,190 |
Allowance for long-term financing receivables | $ 4,915 |
Select Balance Sheet and Stat_3
Select Balance Sheet and Statement of Operations Information - Schedule of Inventory (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 838 | $ 877 |
Work-in-progress | 1,232 | 2,067 |
Finished goods | 15,689 | 15,900 |
Total inventory | $ 17,759 | $ 18,844 |
Select Balance Sheet and Stat_4
Select Balance Sheet and Statement of Operations Information - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Select Balance Sheet And Statement Of Operations Information [Abstract] | ||
Cost of goods sold | $ 21,258 | $ 26,869 |
Provision for inventory obsolescence | 1,208 | 1,439 |
Depreciation expense | $ 1,331 | $ 1,026 |
Select Balance Sheet and Stat_5
Select Balance Sheet and Statement of Operations Information - Schedule of Property and Equipment, Net (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Property Plant And Equipment [Line Items] | ||
Lab equipment tooling and molds | $ 8,053 | $ 7,872 |
Office furniture and equipment | 1,760 | 1,710 |
Leasehold improvements | 1,838 | 1,950 |
Computers and software | 1,815 | 1,811 |
Vehicles | 12 | 16 |
Total property and equipment | 13,478 | 13,359 |
Less: Accumulated depreciation | (9,939) | (8,711) |
Total property and equipment, net | $ 3,539 | $ 4,648 |
Lab Equipment Tooling and Molds | Minimum | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, Useful lives | P4Y | |
Lab Equipment Tooling and Molds | Maximum | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, Useful lives | P10Y | |
Office Furniture and Equipment | Minimum | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, Useful lives | P6Y | |
Office Furniture and Equipment | Maximum | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, Useful lives | P10Y | |
Leasehold Improvements | Maximum | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, Useful lives | P10Y | |
Computers and Software | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, Useful lives | P3Y | |
Vehicles | Minimum | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, Useful lives | P5Y | |
Vehicles | Maximum | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, Useful lives | P7Y |
Select Balance Sheet and Stat_6
Select Balance Sheet and Statement of Operations Information - Schedule of Other Current Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | |
Other Assets [Abstract] | |||
Government remittances | [1] | $ 1,009 | $ 1,704 |
Consideration receivable from subsidiaries sale | 2,580 | ||
Deferred financing costs | 1,063 | ||
Sundry assets and miscellaneous | 1,022 | 1,397 | |
Total other current assets | $ 5,674 | $ 3,101 | |
[1] | Government remittances are receivables from the local tax authorities for refund of sales taxes and income taxes. |
Select Balance Sheet and Stat_7
Select Balance Sheet and Statement of Operations Information - Schedule of Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Payables And Accruals [Abstract] | ||
Payroll and related expense | $ 1,312 | $ 3,117 |
Accrued expenses | 8,582 | 10,645 |
Commission accrual | 2,827 | 4,215 |
Sales and consumption taxes | 7,532 | 3,143 |
Total accrued expenses and other current liabilities | $ 20,253 | $ 21,120 |
Select Balance Sheet and Stat_8
Select Balance Sheet and Statement of Operations Information - Schedule of Change in Warranty Accrual (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Product Warranty Accrual Balance Sheet Classification [Abstract] | ||
Warranty accrual, Balance as of the beginning of the year | $ 1,977 | $ 1,336 |
Warranties assumed through business combination | 273 | |
Warranties issued during the year | 761 | 1,038 |
Warranty costs incurred during the year | (1,099) | (670) |
Warranty accrual, Balance at the end of the year | 1,639 | 1,977 |
Current | 1,106 | 1,254 |
Long-term | $ 533 | $ 723 |
Select Balance Sheet and Stat_9
Select Balance Sheet and Statement of Operations Information - Schedule of Finance Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Interest And Debt Expense [Abstract] | ||
Interest expense | $ 7,615 | $ 7,166 |
Gain on settlement of debt | (297) | |
Accretion on long-term debt | 728 | 680 |
Total finance expenses | $ 8,343 | $ 7,549 |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill - Additional Information (Details) $ in Thousands | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($)ReportingUnit | Dec. 31, 2019USD ($) | Nov. 07, 2019USD ($) |
Goodwill And Intangible Assets [Line Items] | ||||
Goodwill | $ 27,450 | |||
Number of reporting units | ReportingUnit | 1 | |||
Impairment charge | $ 27,450 | $ 27,450 | ||
Venus Concept Ltd. | ||||
Goodwill And Intangible Assets [Line Items] | ||||
Goodwill | $ 24,847 | |||
Technology | Venus Concept Ltd. | ||||
Goodwill And Intangible Assets [Line Items] | ||||
Intangibles assets | 16,900 | |||
Brand Name | Venus Concept Ltd. | ||||
Goodwill And Intangible Assets [Line Items] | ||||
Intangibles assets | $ 1,200 |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill - Schedule of Intangible Assets Net of Accumulated Amortization (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Goodwill And Intangible Assets [Line Items] | ||
Gross Amount | $ 23,800 | $ 23,800 |
Accumulated Amortization | (4,935) | (1,462) |
Net Amount | 18,865 | 22,338 |
Customer Relationships | ||
Goodwill And Intangible Assets [Line Items] | ||
Gross Amount | 1,400 | 1,400 |
Accumulated Amortization | (242) | (149) |
Net Amount | 1,158 | 1,251 |
Brand Name | ||
Goodwill And Intangible Assets [Line Items] | ||
Gross Amount | 2,500 | 2,500 |
Accumulated Amortization | (540) | (276) |
Net Amount | 1,960 | 2,224 |
Technology | ||
Goodwill And Intangible Assets [Line Items] | ||
Gross Amount | 16,900 | 16,900 |
Accumulated Amortization | (3,286) | (469) |
Net Amount | 13,614 | 16,431 |
Supplier Agreement | ||
Goodwill And Intangible Assets [Line Items] | ||
Gross Amount | 3,000 | 3,000 |
Accumulated Amortization | (867) | (568) |
Net Amount | $ 2,133 | $ 2,432 |
Intangible Assets and Goodwil_4
Intangible Assets and Goodwill - Schedule of Estimated Amortization Expense (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Finite Lived Intangible Assets Future Amortization Expense [Abstract] | ||
2021 | $ 3,473 | |
2022 | 3,473 | |
2023 | 3,473 | |
2024 | 3,473 | |
2025 | 3,473 | |
Thereafter | 1,500 | |
Net Amount | $ 18,865 | $ 22,338 |
Commitments and Contingencies -
Commitments and Contingencies - Summary of Future Minimum Lease Payments and Purchase Commitments with Manufacturers (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
2021, Office Lease | $ 1,701 |
2022, Office Lease | 681 |
2023, Office Lease | 277 |
2024, Office Lease | 199 |
2025, Office Lease | 204 |
Thereafter, Office Lease | 994 |
Total, Office Lease | 4,056 |
2021, Purchase Commitments | 7,309 |
Total, Purchase Commitments | 7,309 |
2021 | 9,010 |
2022 | 681 |
2023 | 277 |
2024 | 199 |
2025 | 204 |
Thereafter | 994 |
Total | $ 11,365 |
Commitments and Contingencies_2
Commitments and Contingencies - Additional Information (Details) ¥ in Thousands, $ in Thousands | Mar. 04, 2021USD ($) | Mar. 04, 2021CNY (¥) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Jun. 11, 2019Complaint |
Commitment And Contingencies [Line Items] | |||||
Rent expense | $ 1,961 | $ 2,199 | |||
Purchase obligation | $ 7,309 | ||||
Number of complaints filed | Complaint | 4 | ||||
Xuhui MSA | Subsequent Event | |||||
Commitment And Contingencies [Line Items] | |||||
Penalty amount | $ 150 | ¥ 976 | |||
Contract Manufacturers | |||||
Commitment And Contingencies [Line Items] | |||||
Purchase obligation | 7,207 | ||||
Open Purchase Order | |||||
Commitment And Contingencies [Line Items] | |||||
Purchase obligation | $ 686 | ||||
Open purchase cancellation period | 180 days | ||||
Percentage of open purchase order | 15.00% |
Main Street Term Loan - Additio
Main Street Term Loan - Additional Information (Details) - USD ($) $ in Thousands | Dec. 08, 2024 | Dec. 08, 2023 | Dec. 08, 2020 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||||
Debt instrument face amount | $ 50,000 | |||
Debt instrument term | 5 years | |||
Debt instrument, description of variable rate basis | 30-day LIBOR plus 3%. | |||
Debt instrument basis spread on variable rate | 3.00% | |||
Debt instrument, maturity date | Dec. 8, 2025 | |||
Scenario Forecast | ||||
Debt Instrument [Line Items] | ||||
Debt instrument percentage of outstanding principal to be paid with accrued unpaid interest | 15.00% | 15.00% |
Madryn Long-term Debt and Con_3
Madryn Long-term Debt and Convertible Notes - Additional Information (Details) - USD ($) | Dec. 09, 2020 | Dec. 08, 2020 | Aug. 14, 2018 | Dec. 31, 2020 | Sep. 30, 2020 | Sep. 30, 2020 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Apr. 29, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | |||||||||||
Debt instrument, principal amount | $ 50,000,000 | ||||||||||
Debt instrument, maturity date | Dec. 8, 2025 | ||||||||||
Total loss recognized on extinguishment | $ (2,938,000) | ||||||||||
Debt instrument term | 5 years | ||||||||||
Common stock, par value | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||
Repayments of long-term debt | $ 0 | ||||||||||
Madryn Credit Agreement | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt instrument, principal amount | $ 70,000,000 | $ 70,000,000 | |||||||||
Debt instrument, maturity date | Sep. 30, 2022 | ||||||||||
Debt instrument, interest rate | 9.00% | 10.50% | 10.50% | 10.50% | 12.00% | ||||||
Interest rate, paid in cash | 9.00% | 50.00% | |||||||||
Interest rate, paid in kind | 4.00% | 50.00% | |||||||||
Debt instrument, interest rate terms | Effective August 14, 2018, interest on the Madryn loan was 9.00%, payable quarterly. Previously, interest was payable quarterly, at the Company’s option, as follows: cash interest 9.00% during the interest only period, which was 3 years or 12 principal payments after closing, plus an additional 4.00% rate, paid in kind (“PIK”). | ||||||||||
Additional cash proceeds target from issuance of equity | $ 2,000,000 | ||||||||||
Repayments of debt | $ 42,500,000 | ||||||||||
Credit agreement termination date | Dec. 9, 2020 | ||||||||||
Fee payable to lender for loan | 1,600,000 | ||||||||||
Total loss recognized on extinguishment | (2,938,000) | ||||||||||
Madryn Credit Agreement | Minimum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Revenue targets amount | $ 75,000,000 | $ 85,000,000 | |||||||||
Cash proceeds target from issuance of equity | 5,000,000 | ||||||||||
Tranche A-1 and A-2 and B | Madryn Credit Agreement | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt instrument, borrowed amount | $ 60,000,000 | $ 60,000,000 | $ 60,000,000 | $ 60,000,000 | |||||||
Tranche C | Madryn Credit Agreement | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt instrument, undrawn amount | $ 10,000,000 | $ 10,000,000 | |||||||||
Secured Subordinated Convertible Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt instrument, maturity date | Dec. 9, 2025 | ||||||||||
Debt instrument, interest rate terms | Interest is payable quarterly in arrears on the last business day of each calendar quarter of each year after the original issuance date, beginning on December 31, 2020. | ||||||||||
Increase in applicate interest rate | 4.00% | ||||||||||
Issuance date | Dec. 31, 2020 | ||||||||||
Debt instrument termination description | The security interests and liens granted to the Madryn Noteholders under the Madryn Security Agreement will terminate upon the earlier of (i) an assignment of the Notes (other than to an affiliate of the Madryn Noteholders) pursuant to the terms of the Exchange Agreement and (ii) the first date on which the outstanding principal amount of the Notes is less than $10,000. | ||||||||||
Debt instrument term | 5 years | ||||||||||
Common stock, par value | $ 0.0001 | $ 0.0001 | |||||||||
Initial conversion price | $ 3.25 | $ 3.25 | |||||||||
Interest expense | $ 135,000 | ||||||||||
Secured Subordinated Convertible Notes | Original Issuance of Notes to Third Anniversary Date | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Accrue interest rate | 8.00% | ||||||||||
Secured Subordinated Convertible Notes | Original Issuance and Thereafter | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Accrue interest rate | 6.00% | ||||||||||
Secured Subordinated Convertible Notes | Third Anniversary | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Decrease in interest rate | 6.00% | ||||||||||
Secured Subordinated Convertible Notes | Maximum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt instrument, principal amount | $ 10,000,000 | $ 10,000,000 | |||||||||
Secured Subordinated Convertible Notes | Madryn Credit Agreement | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Aggregate principal amount | $ 26,695,000 |
Madryn Long-term Debt and Con_4
Madryn Long-term Debt and Convertible Notes - Schedule Principal Payments on Outstanding Borrowings (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Debt Disclosure [Abstract] | |
2021 | $ 2,136 |
2022 | 2,136 |
2023 | 2,102 |
2024 | 1,606 |
2025 | 28,196 |
Total | $ 36,176 |
Credit Facility - Additional In
Credit Facility - Additional Information (Details) - City National Bank of Florida - Revolving Credit Facility - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 09, 2020 | Dec. 31, 2019 | |
Line Of Credit Facility [Line Items] | |||
Revolving credit facility, maximum outstanding amount | $ 10,000,000 | $ 10,000,000 | $ 10,000,000 |
Line of credit facility cash held in deposit account period | 1 year | ||
Escrow deposit | $ 20,000,000 | ||
Line of credit facility minimum deposit required | 3,000,000 | ||
Loan fee payable | $ 1,000,000 | ||
Installment One | |||
Line Of Credit Facility [Line Items] | |||
Line of credit facility loan fee payment date | January 25 | ||
Installment Two | |||
Line Of Credit Facility [Line Items] | |||
Line of credit facility loan fee payment date | February 25 | ||
Installment Three | |||
Line Of Credit Facility [Line Items] | |||
Line of credit facility loan fee payment date | March 25, 2021 | ||
Minimum | |||
Line Of Credit Facility [Line Items] | |||
Line of credit facility cash held in deposit account | $ 23,000,000 | ||
Line of credit facility cash held in deposit account after one year | $ 3,000,000 |
Government Assistance Programs
Government Assistance Programs - Additional Information (Details) | Dec. 08, 2020USD ($) | Apr. 29, 2020USD ($) | Apr. 20, 2020USD ($) | Dec. 31, 2020USD ($)Loan | Dec. 31, 2019USD ($) |
Government Assistance Programs [Line Items] | |||||
Debt instrument, principal amount | $ 50,000,000 | ||||
Debt instrument, term of maturity | 5 years | ||||
Debt outstanding balance | $ 36,176,000 | ||||
Government Assistance Programs | Subsidiaries | Canada Emergency Wage Subsidy | |||||
Government Assistance Programs [Line Items] | |||||
Government subsidies received | $ 1,117,000 | ||||
Government Assistance Programs | Paycheck Protection Program | Venus Concept USA Inc. | |||||
Government Assistance Programs [Line Items] | |||||
Number of small business loans | Loan | 2 | ||||
Government Assistance Programs | Paycheck Protection Program | Small Business Loans | Venus Concept USA Inc. | |||||
Government Assistance Programs [Line Items] | |||||
Fund amount received | $ 4,048,000 | ||||
Government Assistance Programs | Paycheck Protection Program | Venus Concept PPP Loan | |||||
Government Assistance Programs [Line Items] | |||||
Debt instrument, principal amount | $ 1,665,000 | ||||
Debt instrument, interest rate, stated percentage | 1.00% | ||||
Debt instrument, term of maturity | 2 years | ||||
Government Assistance Programs | Paycheck Protection Program | Venus USA PPP Loan | |||||
Government Assistance Programs [Line Items] | |||||
Debt instrument, principal amount | $ 2,383,000 | ||||
Government Assistance Programs | Paycheck Protection Program | Venus Concept USA Inc. | |||||
Government Assistance Programs [Line Items] | |||||
Debt forgiveness description | U.S. Small Business Administration (the “SBA”) has decided, in consultation with the Department of the Treasury, that it will review all loans in excess of $2,000 following the lender’s submission of the borrower’s loan forgiveness application. | ||||
Government Assistance Programs | Paycheck Protection Program | PPP Loans | |||||
Government Assistance Programs [Line Items] | |||||
Debt outstanding balance | $ 4,110,000 | $ 0 |
Common Stock Reserved for Iss_3
Common Stock Reserved for Issuance - Schedule of Common Stock Reserved for Issuance (Details) - shares | Dec. 31, 2020 | Dec. 31, 2019 |
Class Of Stock [Line Items] | ||
Outstanding stock options | 4,433,392 | 3,278,439 |
Total common stock reserved for issuance | 34,422,828 | 8,011,334 |
Common Stock | ||
Class Of Stock [Line Items] | ||
Outstanding common stock warrants | 16,290,067 | 3,990,067 |
Option | ||
Class Of Stock [Line Items] | ||
Shares reserved for future grants | 262,622 | 742,828 |
Lincoln Park | ||
Class Of Stock [Line Items] | ||
Shares reserved for future grants | 5,222,867 | |
Madryn Noteholders | ||
Class Of Stock [Line Items] | ||
Shares reserved for future grants | 8,213,880 |
Stockholders Equity - Additiona
Stockholders Equity - Additional Information (Details) | Dec. 22, 2020$ / sharesshares | Jun. 16, 2020USD ($)shares | Mar. 19, 2020$ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares | Mar. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2020USD ($)$ / sharesshares | Dec. 31, 2019USD ($)$ / sharesshares | Oct. 04, 2019shares |
Class Of Stock [Line Items] | ||||||||
Common stock voting rights | one vote | |||||||
Beneficial conversion feature | $ | $ 3,564,000 | |||||||
Net proceeds from private placement | $ | $ 20,476,000 | 20,300,000 | ||||||
Common stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||
Deemed dividends | $ | $ 3,564,000 | $ 3,564,000 | ||||||
Common stock, shares issued | shares | 53,551,126 | 53,551,126 | 28,686,116 | |||||
Net proceeds from shares issuance | $ | $ 8,390,000 | |||||||
Common stock reserved for issuance | shares | 34,422,828 | 34,422,828 | 8,011,334 | |||||
Expected dividend | $ | $ 0 | |||||||
Total intrinsic value of options exercised | $ | $ 464,000 | $ 1,532,000 | ||||||
Weighted-average grant date fair value of options granted | $ / shares | $ 4.17 | $ 5.50 | ||||||
2010 Share Option Plan | ||||||||
Class Of Stock [Line Items] | ||||||||
Stock option, vesting period | 7 years | |||||||
Stock option, vesting period extension | 10 years | |||||||
Common stock reserved for issuance | shares | 138,275 | 138,275 | 44,450 | |||||
2019 Incentive Award Plan | ||||||||
Class Of Stock [Line Items] | ||||||||
Common stock reserved for issuance | shares | 124,347 | 124,347 | 698,378 | 450,000 | ||||
Percentage of common shares outstanding | 4.00% | |||||||
2020 Private Placement Warrants | ||||||||
Class Of Stock [Line Items] | ||||||||
Net proceeds from private placement | $ | 4,621,000 | |||||||
December 2020 Public Offering Warrants and Common Stock | ||||||||
Class Of Stock [Line Items] | ||||||||
Net proceeds from shares issuance | $ | $ 20,476,000 | |||||||
December 2020 Public Offering Warrants | ||||||||
Class Of Stock [Line Items] | ||||||||
Net proceeds from shares issuance | $ | $ 2,648,000 | |||||||
Common Stock | ||||||||
Class Of Stock [Line Items] | ||||||||
Net proceeds from private placement | $ | $ 4,052,000 | |||||||
Preferred stock convertible into common stock | shares | 6,600,000 | |||||||
Common Stock | 2020 Private Placement Warrants | ||||||||
Class Of Stock [Line Items] | ||||||||
Common stock, par value | $ / shares | $ 0.0001 | |||||||
Common Stock | December 2020 Public Offering Warrants and Common Stock | ||||||||
Class Of Stock [Line Items] | ||||||||
Common stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | ||||||
Net proceeds from shares issuance | $ | $ 17,828,000 | |||||||
Series A Convertible Preferred Stock | ||||||||
Class Of Stock [Line Items] | ||||||||
Conversion cap percentage | 19.99% | |||||||
Initial conversion ratio | 0.1 | |||||||
Preferred stock, dividends paid on outstanding shares | $ | $ 0 | |||||||
Share issued price per share | $ / shares | $ 2.47 | |||||||
Preferred stock effective conversion price per share | $ / shares | $ 1.93 | |||||||
Series A Preferred Shares | ||||||||
Class Of Stock [Line Items] | ||||||||
Net proceeds from private placement | $ | $ 8,063,000 | |||||||
Preferred stock convertible into common stock | shares | 660,000 | |||||||
Series A Preferred Shares | 2020 Private Placement Warrants | ||||||||
Class Of Stock [Line Items] | ||||||||
Preferred stock, par value | $ / shares | $ 0.0001 | |||||||
Investors | 2020 Private Placement Warrants | ||||||||
Class Of Stock [Line Items] | ||||||||
Exercise price of warrants | $ / shares | $ 3.50 | |||||||
Warrants expiry period | 5 years | |||||||
Warrants exercisable period | beginning 181 days after their issue date | |||||||
Investors | 2020 Private Placement Warrants | Maximum | ||||||||
Class Of Stock [Line Items] | ||||||||
Warrants to purchase shares of common stock | shares | 6,675,000 | |||||||
Investors | December 2020 Public Offering Warrants and Common Stock | ||||||||
Class Of Stock [Line Items] | ||||||||
Exercise price of warrants | $ / shares | $ 2.50 | $ 2.50 | ||||||
Warrants expiry period | 5 years | |||||||
Warrants exercisable period | The December 2020 Offering Warrants have a five-year term and are exercisable immediately. | |||||||
Common stock, shares issued | shares | 11,250,000 | 11,250,000 | ||||||
Investors | December 2020 Public Offering Warrants and Common Stock | Maximum | ||||||||
Class Of Stock [Line Items] | ||||||||
Warrants to purchase shares of common stock | shares | 5,625,000 | 5,625,000 | ||||||
Investors | December 2020 Public Offering Warrants | ||||||||
Class Of Stock [Line Items] | ||||||||
Exercise price of warrants | $ / shares | $ 2.50 | |||||||
Warrants expiry period | 5 years | |||||||
Investors | December 2020 Public Offering Warrants | Maximum | ||||||||
Class Of Stock [Line Items] | ||||||||
Warrants to purchase shares of common stock | shares | 5,625,000 | |||||||
Securities Purchase Agreement | Investors | ||||||||
Class Of Stock [Line Items] | ||||||||
Warrants expiry period | 5 years | |||||||
Warrants exercisable period | beginning 181 days after their issue date | |||||||
Common stock, par value | $ / shares | $ 0.0001 | |||||||
Common stock, shares issued | shares | 2,300,000 | |||||||
Securities Purchase Agreement | Investors | Series A Convertible Preferred Stock | ||||||||
Class Of Stock [Line Items] | ||||||||
Preferred stock, shares issued | shares | 660,000 | 660,000 | 660,000 | |||||
Preferred stock, par value | $ / shares | $ 0.0001 | |||||||
Securities Purchase Agreement | Investors | Series A Convertible Preferred Stock | Common Stock | ||||||||
Class Of Stock [Line Items] | ||||||||
Preferred stock convertible into common stock | shares | 6,600,000 | 6,600,000 |
Stockholders Equity - Summary o
Stockholders Equity - Summary of Recognized Stock-based Compensation Expense for Employees and Non-employees (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation | $ 2,138 | $ 2,158 |
Employees and Non-employees | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation | 2,138 | 2,158 |
Cost of Sales | Employees and Non-employees | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation | 25 | 3 |
Selling and Marketing | Employees and Non-employees | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation | 872 | 840 |
General and Administrative | Employees and Non-employees | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation | 1,151 | 1,238 |
Research and Development | Employees and Non-employees | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock-based compensation | $ 90 | $ 77 |
Stockholders Equity - Assumptio
Stockholders Equity - Assumptions used in Fair Value of Option Estimated at Date of Grant using Black-Scholes Option Pricing Formula (Details) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected volatility | 42.83% | 49.00% |
Expected dividend rate | 0.00% | 0.00% |
Minimum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected term (in years) | 6 years | 4 years |
Risk-free interest rate, minimum | 0.38% | 1.40% |
Maximum | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Expected term (in years) | 6 years 6 months 14 days | 5 years |
Risk-free interest rate, minimum | 1.50% | 2.53% |
Stockholders Equity - Summary_2
Stockholders Equity - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Roll Forward | ||
Number of Shares, Outstanding, Beginning Balance | 3,278,439 | |
Number of Shares, Options granted | 1,978,000 | |
Number of Shares, Options exercised | (469,754) | |
Number of Shares, Options forfeited/cancelled | (353,293) | |
Number of Shares, Outstanding, Ending Balance | 4,433,392 | 3,278,439 |
Number of Shares, Exercisable | 2,593,711 | |
Number of Shares, Expected to vest | 1,839,681 | |
Weighted-Average Exercise Price Per Share, Outstanding, Beginning Balance | $ 5.29 | |
Weighted-Average Exercise Price Per Share, Options granted | 4.17 | |
Weighted-Average Exercise Price Per Share, Options exercised | 2.45 | |
Weighted-Average Exercise Price Per Share, Options forfeited/cancelled | 13.76 | |
Weighted-Average Exercise Price Per Share, Outstanding, Ending Balance | 4.59 | $ 5.29 |
Weighted-Average Exercise Price Per Share, Exercisable | 4.40 | |
Weighted-Average Exercise Price Per Share, Expected to vest | $ 3.70 | |
Weighted-Average Remaining Contractual Term, Outstanding | 6 years 2 months 12 days | 5 years 29 days |
Weighted-Average Remaining Contractual Term, Exercisable | 4 years 3 months 25 days | |
Weighted-Average Remaining Contractual Term, Expected to vest | 7 years 7 months 9 days | |
Aggregate Intrinsic Value, Outstanding | $ 4,885 | |
Aggregate Intrinsic Value, Options exercised | $ 464 | $ 1,532 |
Aggregate Intrinsic Value, Options forfeited/cancelled | $ 1 | |
Aggregate Intrinsic Value, Outstanding | $ 247 | $ 4,885 |
Aggregate Intrinsic Value, Exercisable | $ 247 |
Stockholders Equity - Summary_3
Stockholders Equity - Summary of Information about Share Options Outstanding and Exercisable (Details) | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | |
Options Outstanding, Number | shares | 4,433,392 |
Options Outstanding, Weighted average remaining contractual term (years) | 6 years 2 months 12 days |
Options Outstanding, Weighted average Exercise Price | $ 4.59 |
Options Exercisable | shares | 2,593,711 |
Options Exercisable, Weighted average remaining contractual term (years) | 4 years 3 months 25 days |
Options Exercisable, Weighted average Exercise Price | $ 4.40 |
$0.15 - $3.64 | |
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | |
Exercise Price Range (Lower limit) | 0.15 |
Exercise Price Range (Upper limit) | $ 3.60 |
Options Outstanding, Number | shares | 2,878,185 |
Options Outstanding, Weighted average remaining contractual term (years) | 6 years 3 days |
Options Outstanding, Weighted average Exercise Price | $ 3.05 |
Options Exercisable | shares | 1,643,103 |
Options Exercisable, Weighted average remaining contractual term (years) | 3 years 7 months 13 days |
Options Exercisable, Weighted average Exercise Price | $ 2.71 |
$4.26 - $7.95 | |
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | |
Exercise Price Range (Lower limit) | 5.25 |
Exercise Price Range (Upper limit) | $ 12 |
Options Outstanding, Number | shares | 1,498,383 |
Options Outstanding, Weighted average remaining contractual term (years) | 6 years 6 months 25 days |
Options Outstanding, Weighted average Exercise Price | $ 6.78 |
Options Exercisable | shares | 909,832 |
Options Exercisable, Weighted average remaining contractual term (years) | 5 years 6 months |
Options Exercisable, Weighted average Exercise Price | $ 6.42 |
$12.45 - $26.10 | |
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | |
Exercise Price Range (Lower limit) | 12.45 |
Exercise Price Range (Upper limit) | $ 26.10 |
Options Outstanding, Number | shares | 35,011 |
Options Outstanding, Weighted average remaining contractual term (years) | 7 years 6 months 29 days |
Options Outstanding, Weighted average Exercise Price | $ 18.45 |
Options Exercisable | shares | 19,638 |
Options Exercisable, Weighted average remaining contractual term (years) | 7 years 5 months 12 days |
Options Exercisable, Weighted average Exercise Price | $ 18.89 |
$27.00 - $33.00 | |
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | |
Exercise Price Range (Lower limit) | 26.70 |
Exercise Price Range (Upper limit) | $ 33 |
Options Outstanding, Number | shares | 12,998 |
Options Outstanding, Weighted average remaining contractual term (years) | 3 years 10 months 6 days |
Options Outstanding, Weighted average Exercise Price | $ 27.99 |
Options Exercisable | shares | 12,954 |
Options Exercisable, Weighted average remaining contractual term (years) | 3 years 10 months 2 days |
Options Exercisable, Weighted average Exercise Price | $ 27.98 |
$36.00 - $94.65 | |
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | |
Exercise Price Range (Lower limit) | 36 |
Exercise Price Range (Upper limit) | $ 94.65 |
Options Outstanding, Number | shares | 8,815 |
Options Outstanding, Weighted average remaining contractual term (years) | 6 years 4 months 13 days |
Options Outstanding, Weighted average Exercise Price | $ 46.14 |
Options Exercisable | shares | 8,184 |
Options Exercisable, Weighted average remaining contractual term (years) | 6 years 4 months 13 days |
Options Exercisable, Weighted average Exercise Price | $ 45.41 |
Income Taxes - Schedule of Geog
Income Taxes - Schedule of Geographical Breakdown of Loss Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
United States | $ (63,259) | $ (23,194) |
Other jurisdictions | (18,378) | (17,244) |
Loss before income taxes | $ (81,637) | $ (40,438) |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Current tax provision: | ||
Foreign | $ 1,619 | $ 2,989 |
Total current tax provision | 1,619 | 2,989 |
Deferred tax benefit: | ||
Foreign | (438) | (1,132) |
Total deferred tax benefit | (438) | (1,132) |
Total provision for income taxes | $ 1,181 | $ 1,857 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Taxes [Line Items] | ||
Deferred tax assets, Valuation allowance | $ 82,587,000 | $ 56,154,000 |
Deferred tax assets, valuation allowance, change in amount | 26,433,000 | 54,049,000 |
Deferred tax assets, federal operating loss carry forwards | 285,094,000 | 228,396,000 |
Deferred tax assets, state operating loss carry forwards | 285,094,000 | 228,396,000 |
Deferred tax assets, foreign operating loss carry forwards | $ 285,094,000 | 228,396,000 |
Operating loss carry forwards, expiry description | 2022 and indefinitely | |
Operating loss carry forwards, expiry year start | 2022 | |
Operating loss carry forwards, expiry year end | 2025 | |
Uncertain tax position | greater than 50% | |
Future tax benefits | $ 884,000 | 622,000 |
Open to examination by Unites states and various states jurisdictions | 2014 2015 2016 2017 2018 2019 2020 | |
Accrued interest and penalties recognized | $ 0 | $ 0 |
Federal | ||
Income Taxes [Line Items] | ||
Research and development tax credit carryforwards | 2,680,000 | |
State | ||
Income Taxes [Line Items] | ||
Research and development tax credit carryforwards | $ 2,602,000 |
Income Taxes - Reconciliation b
Income Taxes - Reconciliation between Income Taxes Computed at Federal Statutory Income Tax Rate and Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Effective Income Tax Rate Continuing Operations Tax Rate Reconciliation [Abstract] | ||
Loss before income taxes | $ (81,637) | $ (40,438) |
Theoretical tax benefit at the statutory rate (21.0% in 2020, 23.9% in 2019) | (17,144) | (9,665) |
Differences in jurisdictional tax rates | (2,817) | (337) |
Recognition of losses | (1,923) | |
Valuation allowance | 12,416 | 12,343 |
Non-deductible expenses | 8,080 | 2,217 |
Other | 646 | (778) |
Total provision for income taxes | 1,181 | 1,857 |
Net loss | $ (82,818) | $ (42,295) |
Income Taxes - Reconciliation_2
Income Taxes - Reconciliation between Income Taxes Computed at Federal Statutory Income Tax Rate and Provision for Income Taxes (Parenthetical) (Details) | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Effective Income Tax Rate Continuing Operations Tax Rate Reconciliation [Abstract] | ||
Theoretical tax benefit, statutory rate | 21.00% | 23.90% |
Income Taxes - Schedule of Co_2
Income Taxes - Schedule of Components of Deferred Tax Assets and Deferred Tax Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Property and equipment | $ 735 | $ 81 |
Deferred revenue | 2,065 | 101 |
Allowance for doubtful accounts | 2,670 | 440 |
Intangible assets | (2,554) | |
Non-deductible expenses | 8,350 | |
Warranty and other reserves | 729 | |
Other | 114 | |
Loss carryforwards | 71,362 | 56,154 |
Valuation allowance | (82,587) | (56,154) |
Total deferred tax assets | 884 | 622 |
Deferred tax liabilities: | ||
Deferred revenue | 811 | 1,017 |
Total deferred tax liabilities | $ 811 | $ 1,017 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of Uncertain Tax Position (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | ||
Balance as of the beginning of the year | $ 1,467 | $ 1,467 |
Increases related to tax positions in prior period | 57 | 0 |
Increases related to tax positions taken during the current period | 60 | 0 |
Balance at the end of the year | $ 1,584 | $ 1,467 |
Income Taxes - Schedule of Tax
Income Taxes - Schedule of Tax Effected Amount of Recognized Tax Position (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Schedule Of Recognized Tax Benefit [Abstract] | ||
Balance as of the beginning of the year | $ 0 | $ 0 |
Increases related to tax positions in prior period | (369) | 0 |
Increase related to interest expense | (109) | 0 |
Balance at the end of the year | $ (478) | $ 0 |
Segment and Geographic Inform_3
Segment and Geographic Information - Additional Information (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020USD ($)Segment | Dec. 31, 2019USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of operating segments | Segment | 1 | |
Number of reportable segments | Segment | 1 | |
Lease Revenue | ||
Segment Reporting Information [Line Items] | ||
System sales with typical lease terms | 36 months | |
System Revenue | ||
Segment Reporting Information [Line Items] | ||
Systems sales with payment terms | 12 months | |
United States | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets | $ | $ 19,828 | $ 23,883 |
Foreign | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets | $ | $ 2,576 | $ 3,103 |
Segment and Geographic Inform_4
Segment and Geographic Information - Schedule of Revenue by Geographic Area (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Total revenue | $ 78,014 | $ 110,406 |
United States | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Total revenue | 33,987 | 47,723 |
Foreign | ||
Revenues From External Customers And Long Lived Assets [Line Items] | ||
Total revenue | $ 44,027 | $ 62,683 |
Segment and Geographic Inform_5
Segment and Geographic Information - Schedule of Revenue by Type (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Entity Wide Information Revenue From External Customer [Line Items] | ||
Total revenue | $ 78,014 | $ 110,406 |
Lease Revenue | ||
Entity Wide Information Revenue From External Customer [Line Items] | ||
Total revenue | 33,428 | 65,170 |
System Revenue | ||
Entity Wide Information Revenue From External Customer [Line Items] | ||
Total revenue | 28,957 | 31,730 |
Product Revenue | ||
Entity Wide Information Revenue From External Customer [Line Items] | ||
Total revenue | 10,858 | 6,943 |
Service Revenue | ||
Entity Wide Information Revenue From External Customer [Line Items] | ||
Total revenue | $ 4,771 | $ 6,563 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) | 12 Months Ended | |
Dec. 31, 2020USD ($)$ / System | Dec. 31, 2019USD ($) | |
Related Party Transaction [Line Items] | ||
Trade payables | $ 0 | $ 0 |
Intellectual Property Transfer Agreement | ||
Related Party Transaction [Line Items] | ||
Aggregate amount of income transferred for license | 3,000,000 | |
Royalties | $ 0 | 806,000 |
Intellectual Property Transfer Agreement | Venus Viva System and the Related Consumables | ||
Related Party Transaction [Line Items] | ||
Percentage of income transferred for license | 7.00% | |
Intellectual Property Transfer Agreement | Venus Versa System | ||
Related Party Transaction [Line Items] | ||
Amount transferred per system for license | $ / System | 1.50 | |
Senior Manager | TBC | ||
Related Party Transaction [Line Items] | ||
Percentage of ownership by senior manager in TBC | 30.00% | |
TBC | ||
Related Party Transaction [Line Items] | ||
Products purchased | $ 278,000 | $ 378,000 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - Investors - December 2020 Public Offering Warrants - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | |
Feb. 28, 2021 | Dec. 22, 2020 | |
Subsequent Event [Line Items] | ||
Exercise price of warrants | $ 2.50 | |
Subsequent Event | ||
Subsequent Event [Line Items] | ||
Warrants to purchase shares of common stock | 361,200 | |
Exercise price of warrants | $ 2.50 | |
Proceeds from warrant exercise | $ 903 |