Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Oct. 31, 2017 | |
Document And Entity Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | CarGurus, Inc. | |
Trading Symbol | CARG | |
Entity Central Index Key | 1,494,259 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Class A Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 77,877,494 | |
Class B Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 28,213,276 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Current assets | ||
Cash and cash equivalents | $ 25,636 | $ 29,476 |
Investments | 60,000 | 44,774 |
Accounts receivable, net of allowance for doubtful accounts of $141 and $164, respectively | 10,123 | 6,653 |
Prepaid income taxes | 1,815 | |
Prepaid expenses and other current assets | 3,485 | 2,789 |
Total current assets | 99,244 | 85,507 |
Property and equipment, net (Note 4) | 16,100 | 12,780 |
Restricted cash | 1,783 | 2,044 |
Deferred tax assets | 371 | |
Other long-term assets (Note 5) | 4,158 | |
Total assets | 121,656 | 100,331 |
Current liabilities | ||
Accounts payable | 22,737 | 16,426 |
Accrued expenses (Note 6) | 9,953 | 8,384 |
Deferred revenue | 4,598 | 3,330 |
Accrued income taxes | 156 | |
Deferred rent | 1,144 | 910 |
Total current liabilities | 38,588 | 29,050 |
Deferred rent, net of current portion | 5,701 | 5,673 |
Deferred tax liabilities | 292 | |
Other non-current liabilities | 969 | 590 |
Total liabilities | 45,258 | 35,605 |
Commitments and contingencies (Note 7) | ||
Convertible preferred stock (Note 8) | 132,698 | 132,698 |
Stockholders’ deficit: | ||
Additional paid-in capital | 4,225 | 3,714 |
Accumulated deficit | (60,766) | (71,698) |
Accumulated other comprehensive income (loss) | 199 | (30) |
Total stockholders’ deficit | (56,300) | (67,972) |
Total liabilities, convertible preferred stock, and stockholders’ deficit | 121,656 | 100,331 |
Class A Common Stock | ||
Stockholders’ deficit: | ||
Common stock | 14 | 14 |
Class B Common Stock | ||
Stockholders’ deficit: | ||
Common stock | $ 28 | $ 28 |
Unaudited Condensed Consolidat3
Unaudited Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Allowance for doubtful accounts | $ 141 | $ 164 |
Class A Common Stock | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 120,020,700 | 120,020,700 |
Common stock, shares issued | 14,107,816 | 14,022,132 |
Common stock, shares outstanding | 14,107,816 | 14,022,132 |
Class B Common Stock | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 80,013,800 | 80,013,800 |
Common stock, shares issued | 28,213,276 | 28,044,264 |
Common stock, shares outstanding | 28,213,276 | 28,044,264 |
Unaudited Condensed Consolidat4
Unaudited Condensed Consolidated Income Statements - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | ||
Income Statement [Abstract] | |||||
Revenue | $ 82,989 | $ 53,136 | $ 226,264 | $ 137,377 | |
Cost of revenue | [1] | 4,720 | 2,852 | 12,367 | 6,671 |
Gross profit | 78,269 | 50,284 | 213,897 | 130,706 | |
Operating expenses: | |||||
Sales and marketing | 63,891 | 40,510 | 168,495 | 108,823 | |
Product, technology, and development | 5,796 | 2,984 | 14,153 | 8,134 | |
General and administrative | 5,006 | 3,101 | 14,098 | 8,719 | |
Depreciation and amortization | 713 | 432 | 1,909 | 1,065 | |
Total operating expenses | 75,406 | 47,027 | 198,655 | 126,741 | |
Income from operations | 2,863 | 3,257 | 15,242 | 3,965 | |
Other income, net | 106 | 107 | 323 | 260 | |
Income before income taxes | 2,969 | 3,364 | 15,565 | 4,225 | |
Provision for income taxes | 590 | 1,226 | 4,633 | 1,566 | |
Net income | 2,379 | 2,138 | 10,932 | 2,659 | |
Reconciliation of net income to net income attributable to common stockholders: | |||||
Net income | 2,379 | 2,138 | 10,932 | 2,659 | |
Net income attributable to participating securities | (1,401) | (1,260) | (6,446) | (1,554) | |
Net income attributable to common stockholders — basic | 978 | 878 | 4,486 | 1,105 | |
Net income attributable to participating securities | (1,345) | (1,222) | (6,198) | (1,507) | |
Net income attributable to common stockholders — diluted | $ 1,034 | $ 916 | $ 4,734 | $ 1,152 | |
Net income per share attributable to common stockholders: (Note 10) | |||||
Basic | $ 0.02 | $ 0.02 | $ 0.11 | $ 0.02 | |
Diluted | $ 0.02 | $ 0.02 | $ 0.10 | $ 0.02 | |
Weighted-average number of shares of common stock used in computing net income per share attributable to common stockholders: | |||||
Basic | 42,262,035 | 44,692,419 | 42,168,904 | 44,665,063 | |
Diluted | 46,567,173 | 48,069,373 | 46,310,630 | 48,040,754 | |
[1] | Includes depreciation and amortization expense for the three months ended September 30, 2017 and 2016 and for the nine months ended September 30, 2017 and 2016 of $370, $113, $761, and $316, respectively. |
Unaudited Condensed Consolidat5
Unaudited Condensed Consolidated Income Statements (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Statement [Abstract] | ||||
Depreciation and amortization expense | $ 370 | $ 113 | $ 761 | $ 316 |
Unaudited Condensed Consolidat6
Unaudited Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net income | $ 2,379 | $ 2,138 | $ 10,932 | $ 2,659 |
Other comprehensive income: | ||||
Foreign currency translation adjustment | 72 | 1 | 229 | (18) |
Comprehensive income | $ 2,451 | $ 2,139 | $ 11,161 | $ 2,641 |
Unaudited Consolidated Statemen
Unaudited Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Operating Activities | ||
Net income | $ 10,932 | $ 2,659 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 2,670 | 1,381 |
Unrealized currency loss on foreign denominated transactions | 96 | |
Deferred taxes | (663) | 204 |
Provision for doubtful accounts | 544 | 334 |
Stock-based compensation expense | 224 | 236 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (4,013) | (568) |
Prepaid expenses, prepaid income taxes, and other current assets | 1,143 | (2,838) |
Accounts payable | 6,409 | 11,485 |
Accrued expenses | (741) | 2,153 |
Deferred revenue | 1,265 | 1,705 |
Deferred rent | 262 | 2,049 |
Accrued income taxes | 156 | 1,190 |
Other non-current liabilities | 258 | 461 |
Net cash provided by operating activities | 18,542 | 20,451 |
Investing Activities | ||
Purchases of property and equipment | (4,247) | (4,009) |
Capitalization of website development costs | (1,487) | (913) |
Investments in certificates of deposit | (50,000) | (41,774) |
Maturities of certificates of deposit | 34,774 | 5,000 |
Net cash used in investing activities | (20,960) | (41,696) |
Financing Activities | ||
Proceeds from issuance of preferred stock | 60,000 | |
Proceeds from exercise of unit options and stock options | 288 | 92 |
Payment of deferred initial public offering costs | (2,128) | |
Cash paid for repurchase of preferred stock, common stock, and vested options | (1,262) | |
Net cash (used in) provided by financing activities | (1,840) | 58,830 |
Impact of foreign currency on cash, cash equivalents, and restricted cash | 157 | (26) |
Net (decrease) increase in cash, cash equivalents, and restricted cash | (4,101) | 37,559 |
Cash, cash equivalents, and restricted cash at beginning of period | 31,520 | 62,863 |
Cash, cash equivalents, and restricted cash at end of period | 27,419 | 100,422 |
Supplemental disclosure of cash flow information: | ||
Cash paid for income taxes | 4,220 | 6 |
Cash paid for interest | 17 | 20 |
Supplemental disclosure of non-cash investing and financing activities: | ||
Unpaid purchases of property and equipment | 739 | 1,774 |
Unpaid deferred initial public offering costs | $ 2,014 | |
Unpaid preferred stock issuance costs | $ 268 |
Organization and Business Descr
Organization and Business Description | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Organization and Business Description | 1. Organization and Business Description CarGurus, Inc. (the “Company”), is a global, online automotive marketplace connecting buyers and sellers of new and used cars. Using proprietary technology, search algorithms, and innovative data analytics, the Company provides information and analysis that create a differentiated automotive search experience for consumers. The Company’s marketplace empowers users worldwide with unbiased third-party validation on pricing, dealer reputation, and other useful information that aids them in finding “Great Deals from Top-Rated Dealers.” The Company is headquartered in Cambridge, Massachusetts and was incorporated in the state of Delaware on June 26, 2015. The Company operates principally in the United States and has also launched marketplaces in Canada, the United Kingdom, and Germany. The Company has wholly owned subsidiaries in the United States, Ireland, and the United Kingdom. The Company is subject to a number of risks and uncertainties common to companies in similar industries and stages of development including, but not limited to, rapid technological changes, competition from substitute products and services from larger companies, management of international activities, protection of proprietary rights, patent litigation, and dependence on key individuals. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying interim condensed consolidated financial statements (the “Unaudited Condensed Consolidated Financial Statements”) are unaudited. These Unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2016 included in the Company’s final prospectus related to the initial public offering (“IPO”), filed with the pursuant to Rule 424(b)(4) under the Securities Act of 1933, as amended, on October 12, 2017 (the “Prospectus”). The Unaudited Condensed Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the SEC. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. The Unaudited Condensed Consolidated Financial Statements reflect all adjustments, consisting of only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of September 30, 2017 and December 31, 2016, results of operations for the three months and nine months ended September 30, 2017 and 2016, and cash flows for the nine months ended September 30, 2017 and 2016. The accompanying Unaudited Condensed Consolidated Financial Statements reflect the application of certain significant accounting policies as described below and elsewhere in these notes to the Unaudited Condensed Consolidated Financial Statements there have been no material changes in the Company's significant accounting policies from those that were disclosed in the Prospectus In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-09, Compensation — Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting Principles of Consolidation The accompanying Unaudited Condensed Consolidated Financial Statements include the accounts of CarGurus, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The Company prepares its Unaudited Condensed Consolidated Financial Statements and related disclosures in conformity with GAAP. Subsequent Event Considerations The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. The Company has evaluated all subsequent events and determined that there are no material recognized or unrecognized subsequent events requiring disclosure, other than those disclosed in this Quarterly Report on Form 10-Q. Use of Estimates In preparing its Unaudited Condensed Consolidated Financial Statements in accordance with GAAP, the Company is required to make estimates and assumptions that affect the amounts of assets, liabilities, revenue, costs, and expenses, and disclosure of contingent assets and liabilities which are reported in the Unaudited Condensed Consolidated Financial Statements and accompanying disclosures. The accounting estimates that require the most difficult and subjective judgments include revenue recognition and revenue reserves, contingent liabilities, allowances for doubtful accounts, expected future cash flows used to evaluate the recoverability of long-lived assets, the expensing and capitalization of product, technology, and development costs for website development and internal-use software, the determination of the fair value of stock awards issued, stock-based compensation expense, and the recoverability of the Company's net deferred tax assets and related valuation allowance. 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 the Company’s estimates and assumptions. Emerging Growth Company Status The Company is an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act, or JOBS Act, and may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies. The Company may take advantage of these exemptions until the Company is no longer an emerging growth company. Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period afforded by the JOBS Act for the implementation of new or revised accounting standards. The Company has elected to use the extended transition period for complying with new or revised accounting standards and as a result of this election, its financial statements may not be comparable to companies that comply with public company effective dates. The Company may take advantage of these exemptions up until December 31, 2022 or such earlier time that it is no longer an emerging growth company. The Company would cease to be an emerging growth company if it has more than $1.07 billion in annual revenue, it has more than $700.0 million in market value of its stock held by non-affiliates (and it has been a public company for at least 12 months, and has filed one annual report on Form 10-K), or it issues more than $1.0 billion of non-convertible debt securities over a three-year period. Concentration of Credit Risk T he Company has no significant off-balance sheet risk, such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash, cash equivalents, investments, and trade accounts receivable. The Company maintains its cash, cash equivalents, and investments principally with accredited financial institutions of high credit standing. Although the Company deposits its cash and investments with multiple financial institutions, its deposits, at times, may exceed federally insured limits. Credit risk with respect to accounts receivable is dispersed due to the large number of customers. The Company routinely assesses the creditworthiness of its customers. The Company generally has not experienced any material losses related to receivables from individual customers, or groups of customers. The Company does not require collateral. Due to these factors, no additional credit risk beyond amounts provided for collection losses is believed by management to be probable in the Company's accounts receivable. For the nine months ended September 30, 2017 and the year ended December 31, 2016, no individual customer accounted for more than 10% of total revenue. As of September 30, 2017, three customers accounted for 17%, 15%, and 10% of net accounts receivable, respectively. As of December 31, 2016, two customers accounted for 24% and 15% of net accounts receivable, respectively. No other individual customer accounted for more than 10% of net accounts receivable at September 30, 2017 or December 31, 2016. Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies and adopted by the Company on or prior to the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of Effective Date In February 2016, the FASB issued ASU No. 2016-02 , Leases (Topic 842) In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments |
Fair Value of Financial Instrum
Fair Value of Financial Instruments Including Cash, Cash Equivalents and Investments | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments Including Cash, Cash Equivalents and Investments | 3. Fair Value of Financial Instruments Including Cash, Cash Equivalents and Investments ASC 820, Fair Value Measurements and Disclosures ASC 820 identifies fair value as the exchange price, or exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. The Company uses valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows: Level 1 — Quoted unadjusted prices for identical instruments in active markets. Level 2 — Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all observable inputs and significant value drivers are observable in active markets. Level 3 — Model-derived valuations in which one or more significant inputs or significant value drivers are unobservable, including assumptions developed by the Company. The valuation techniques that may be used to measure fair value are as follows: Market Approach — Uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. Income Approach — Uses valuation techniques to convert future amounts to a single present amount based on current market expectations about those future amounts, including present value techniques, option pricing models, and excess earnings method. Cost Approach — Based on the amount that currently would be required to replace the service capacity of an asset (replacement cost). The following tables present, for each of the fair value levels, the Company’s assets that are measured at fair value on a recurring basis at September 30, 2017 and at December 31, 2016: At September 30, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) Significant Other Observable Inputs (Level 2 Inputs) Significant Unobservable Inputs (Level 3 Inputs) Total Assets: Cash equivalents: Money market funds $ 10,627 $ — $ — $ 10,627 Investments: Certificates of deposit — 60,000 — 60,000 Total $ 10,627 $ 60,000 $ — $ 70,627 At December 31, 2016 Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) Significant Other Observable Inputs (Level 2 Inputs) Significant Unobservable Inputs (Level 3 Inputs) Total Assets: Investments: Certificates of deposit $ — $ 44,774 $ — $ 44,774 Total $ — $ 44,774 $ — $ 44,774 The Company measures eligible assets and liabilities at fair value with changes in value recognized in earnings. Fair value treatment may be elected either upon initial recognition of an eligible asset or liability or, for an existing asset or liability, if an event triggers a new basis of accounting. The Company did not elect to remeasure any of its existing financial assets or liabilities, and did not elect the fair value option for any financial assets and liabilities transacted in the nine months ended September 30, 2017 or the year ended December 31, 2016. The Company considers all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash equivalents. Investments not classified as cash equivalents with maturities less than one year from the balance sheet date are classified as short-term investments, while investments with maturities in excess of one year from the balance sheet date are classified as long-term investments. Management determines the appropriate classification of investments at the time of purchase, and re-evaluates such determination at each balance sheet date. Cash and cash equivalents primarily consist of cash on deposit with banks, and amounts held in interest-bearing money market accounts. Cash equivalents are carried at cost, which approximates their fair market value. The following is a summary of cash, cash equivalents, and investments as of September 30, 2017 and December 30, 2016. Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value September 30, 2017 Cash and cash equivalents due in 90 days or less $ 25,636 $ — $ — $ 25,636 Investments: Certificates of deposit due in one year or less 60,000 $ 60,000 Total cash, cash equivalents, and investments $ 85,636 $ — $ — $ 85,636 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value December 31, 2016 Cash and cash equivalents due in 90 days or less $ 29,476 $ — $ — $ 29,476 Investments: Certificates of deposit due in one year or less 44,774 $ 44,774 Total cash, cash equivalents, and investments $ 74,250 $ — $ — $ 74,250 Certificates of deposit at September 30, 2017 had maturity dates ranging from nine to twelve months. Certificates of deposit at December 31, 2016 had maturity dates ranging from six to twelve months. |
Property and Equipment, Net
Property and Equipment, Net | 9 Months Ended |
Sep. 30, 2017 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment, Net | 4. Property and Equipment, Net Property and equipment consists of the following: At September 30, 2017 At December 31, 2016 Computer equipment 3,009 2,001 Capitalized software 174 114 Website development costs 4,167 2,680 Furniture and fixtures 4,461 3,386 Leasehold improvements 10,646 8,202 Construction in progress 35 119 22,492 16,502 Less accumulated depreciation (6,392 ) (3,722 ) Property and equipment, net $ 16,100 $ 12,780 Depreciation and amortization expense on property and equipment for the three months ended September 30, 2017 and 2016 and for the nine months ended September 30, 2017 and 2016 was $1,083, $545, $2,670, and $1,381 respectively. |
Other Long-Term Assets
Other Long-Term Assets | 9 Months Ended |
Sep. 30, 2017 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |
Other Long-Term Assets | 5. Other Long-Term Assets Other long-term assets consists of the following: At September 30, 2017 At December 31, 2016 Deferred IPO issuance costs $ 4,142 $ — Other long-term assets 16 — $ 4,158 $ — Deferred IPO issuance costs, which primarily consist of direct incremental legal and accounting fees relating to the IPO, are capitalized. The deferred issuance costs will be offset against IPO proceeds upon the completion of the Company's IPO, which occurred in October 2017. As of September 30, 2017, $4,142 of deferred IPO issuance costs were recorded in other long-term assets in the accompanying unaudited condensed consolidated balance sheet. As of December 31, 2016, there were no deferred IPO issuance costs recorded. |
Accrued Expenses
Accrued Expenses | 9 Months Ended |
Sep. 30, 2017 | |
Accrued Liabilities Current [Abstract] | |
Accrued Expenses | 6. Accrued Expenses Accrued expenses consists of the following: At September 30, 2017 At December 31, 2016 Accrued bonuses $ 5,086 $ 4,662 Accrued commissions 1,520 1,305 Other accrued expenses 3,347 2,417 $ 9,953 $ 8,384 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 7. Commitments and Contingencies Operating Leases The Company’s lease obligations consist of various leases for office space in Massachusetts and Dublin with various lease terms through January 2024. The terms of the Company’s Massachusetts lease agreements provide for rental payments that increase on an annual basis. The Company recognizes rent expense on a straight-line basis over the lease period. The Company does not have any debt or material capital lease obligations as of December 31, 2016 and all of the Company’s property, equipment, and software have been purchased with cash. The Company has no material long-term purchase obligations outstanding with any vendors or third parties. As of September 30, 2017, there were no material changes in the Company’s contractual obligations and commitments from those disclosed in the Prospectus filed with the SEC, other than as discussed below. On September 26, 2017, the Company entered into a lease for approximately 13,326 square feet of rentable office space located at Upper Hatch Street, Dublin, Ireland. The lease ends on August 11, 2023. Excluding operating costs, rent payments for the first year is $0.5 million. In August 2018, the rent amount is subject to a national rent review, which will establish the rent payments for the remainder of the lease. At September 30, 2017 and December 31, 2016, restricted cash was $1,783 and $2,044, respectively. Restricted cash for both periods was held at a financial institution in an interest-bearing cash account as collateral for two letters of credit related to the contractual provisions of the Company's building leases that require security deposits. Legal Matters The Company, from time to time, is party to litigation arising in the ordinary course of business. Management does not believe that the outcome of these claims will have a material adverse effect on the consolidated financial position, results of operations or cash flows of the Company based on the status of proceedings at this time. Guarantees and Indemnification Obligations In the ordinary course of business, the Company enters into agreements with its customers that are consistent with industry practice with respect to licensing, infringement, indemnification, and other standard provisions. The Company does not, in the ordinary course, agree to indemnification obligations for the Company under its contracts with customers. Based on historical experience and information known at September 30, 2017 and December 31, 2016, the Company has not incurred any costs for guarantees or indemnities. |
Convertible Preferred Stock and
Convertible Preferred Stock and Stockholders' Equity | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Convertible Preferred Stock and Stockholders' Equity | 8. Convertible Preferred Stock and Stockholders’ Equity On June 21, 2017, the Company amended and restated its Certificate of Incorporation pursuant to the Third Amended and Restated Certificate of Incorporation. Under the Third Amended and Restated Certificate of Incorporation, the total number of shares of all classes of stock which the Company shall have authority to issue is (i) 120,020,700 shares of Class A common stock, par value $0.001 per share, (ii) 80,013,800 shares of Class B common stock, par value $0.001 per share, and (iii) 11,091,782 shares of Preferred Stock, par value $0.001 per share, of which 3,333,000 shares are designated Series A Preferred Stock, 3,329,497 shares are designated Series B Preferred Stock, 1,648,978 shares are designated Series C Preferred Stock, 1,673,105 shares are designated Series D convertible preferred stock, or Series D Preferred Stock, and 1,107,202 shares are designated Series E convertible preferred stock, or Series E Preferred Stock. The Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock, Series D Preferred Stock, and Series E Preferred Stock are referred to collectively as the Preferred Stock. Upon the effectiveness of the Third Amended and Restated Certificate of Incorporation, (i) each share of Class A common stock issued and outstanding was recapitalized, reclassified, and reconstituted into two (2) fully paid and non-assessable shares of outstanding Class A common stock and four (4) fully paid and non-assessable shares of outstanding Class B common stock, and (ii) each share of Class B common stock of the Corporation issued and outstanding was recapitalized, reclassified, and reconstituted into two (2) fully paid and non-assessable shares of outstanding Class A common stock and four (4) fully paid and non-assessable shares of outstanding Class B common stock. Further, upon the effectiveness of the Third Amended and Restated Certificate of Incorporation, the number of shares of common stock as to which each outstanding option to purchase common stock is exercisable for and each outstanding restricted stock unit (“RSU”) is convertible into was adjusted such that upon exercise of outstanding stock options or vesting of outstanding RSUs, each holder will receive two (2) fully paid and non-assessable shares of Class A common stock and four (4) fully paid and non-assessable shares of Class B common stock in respect of each share of common stock previously underlying such option or RSU. The exercise price per share of common stock underlying each outstanding option was adjusted upon the effectiveness of the Third Amended and Restated Certificate of Incorporation to be one-sixth of the exercise price per share in effect immediately prior to such adjustment and the fair market value per share of common stock issuable upon settlement of such RSU was adjusted to be one-sixth of the fair market value per share in effect immediately prior to the recapitalization. All share and per share data shown in the accompanying Unaudited Condensed Consolidated Financial Statements and related notes have been retroactively revised to reflect the share recapitalization. On October 16, 2017, in connection with the closing of the Company’s IPO, each share of Preferred Stock was converted into approximately six shares of Class A common stock pursuant to the terms of the Third Amended and Restated Certificate of Incorporation. Immediately following the closing of the Company’s IPO and the conversion of the Preferred Stock, the Company’s Fourth Amended and Restated Certificate of Incorporation became effective. Under the Fourth Amended and Restated Certificate of Incorporation, the capital structure of the Company was adjusted. See Note 12 to these Unaudited Condensed Consolidated Financial Statements for additional information regarding the conversion of the Preferred Stock and the impact of the effectiveness of the Company’s Fourth Amended and Restated Certificate of Incorporation. Common Stock Each share of Class A common stock entitles the holder to one (1) vote for each share on all matters submitted to a vote of the Company’s stockholders at all meetings of stockholders and written actions in lieu of meetings. Each share of Class B common stock entitles the holder to ten votes for each share on all matters submitted to a vote of the Company’s stockholders at all meetings of stockholders and written actions in lieu of meetings. Holders of common stock are entitled to receive dividends, when and if declared by the Board. At September 30, 2017, each share of Class B common stock was convertible into one share of Class A common stock at the option of the holder at any time. Automatic conversion was to occur upon the occurrence of a Transfer, as was defined in the Third Amended and Restated Certificate of Incorporation, of such share of Class B common stock. Upon either the death or voluntary termination of the Company’s Chief Executive Officer, all shares of Class B common stock will automatically be converted into one share of Class A common stock. Upon the effectiveness of the Company’s Fourth Amended and Restated Certificate of Incorporation, additional terms of conversion and transfer were implemented. See Note 12 to these Unaudited Condensed Consolidated Financial Statements for additional information regarding the current conversion and transfer terms of the Company’s common stock. Preferred Stock On August 23, 2016, the Company completed a Series E Preferred Stock financing in the amount of $59,732, net of issuance costs of approximately $268. In connection with this issuance, the Company used the proceeds received to repurchase and retire certain outstanding shares of Series A, Series B, and Series C Preferred Stock and common stock, as well as certain vested stock options and RSUs, from existing stockholders in the fourth quarter of 2016. The difference between the amount implicitly paid to repurchase the various classes of Preferred Stock and the corresponding carrying value of the underlying shares ($32,087) was treated as a deemed dividend and was recorded against retained earnings. As the shares of common stock were repurchased for constructive retirement in the fourth quarter of 2016, the excess purchase price over the corresponding par value was charged directly to retained earnings. The Company’s Preferred Stock at both September 30, 2017 and December 31, 2016 was as follows: Original Issue Price Per Share Shares Authorized Issued and Outstanding Liquidation Amount Carrying Value Series A Preferred Stock $ 0.525053 3,333,000 2,824,703 $ 1,483 $ 1,483 Series B Preferred Stock $ 0.780899 3,329,497 2,938,486 2,295 2,295 Series C Preferred Stock $ 0.849012 1,648,978 1,550,612 1,316 1,316 Series D Preferred Stock $ 40.642989 1,673,105 1,673,105 68,000 67,872 Series E Preferred Stock $ 54.190650 1,107,202 1,107,202 60,000 59,732 11,091,782 10,094,108 $ 133,094 $ 132,698 At both September 30, 2017 and December 31, 2016, 20,188,226 shares of Class A common stock and 40,376,452 shares of Class B common stock were reserved for conversion of the outstanding Preferred Stock. |
Stock-based Compensation
Stock-based Compensation | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-based Compensation | 9. Stock-based Compensation For the three months ended September 30, 2017 and 2016 total stock-based compensation expense was $74 and $88, respectively. For the nine months ended September 30, 2017 and 2016 total stock-based compensation expense was $224 and $236, respectively. All stock-based compensation expense for these periods related to stock options. On January 1, 2017, the Company adopted ASU 2016-09 and elected to account for forfeitures when they occur, on a modified retrospective basis. The cumulative effect adjustment related to the Company's accounting policy change for forfeitures was not material . Total stock-based compensation expense was allocated as follows: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Cost of revenue $ 6 $ 6 $ 16 $ 14 Sales and marketing expense 35 43 108 119 Product, technology, and development expense 24 28 72 76 General and administrative expense 9 11 28 27 Total $ 74 $ 88 $ 224 $ 236 As of September 30, 2017, there was approximately $0.5 million of unrecognized stock-based compensation expense related to stock options which is expected to be recognized over 2.1 years. In addition to stock options, the Company has historically granted RSUs which are subject to both a service-based vesting and a performance-based vesting condition achieved upon a liquidity event, defined as either a change of control or an IPO. As of September 30, 2017, t otal unrecognized stock-based compensation expense related to these RSUs was approximately $10.1 million and is expected to be recognized over 3.1 years. , t |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 10. Earnings Per Share Net income per share information is determined using the two-class method, which includes the weighted-average number of shares of common stock outstanding during the period and other securities that participate in dividends (a participating security). The Company considers the convertible Preferred Stock to be participating securities because they include rights to participate in dividends with the common stock. Under the two-class method, basic net income per share attributable to common stockholders is computed by dividing the net income attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the period. Diluted net income (loss) per share attributable to common stockholders is computed using the more dilutive of (1) the two-class method or (2) the if-converted method. The Company allocates net income first to preferred stockholders based on dividend rights under the Company’s certificate of incorporation and then to preferred and common stockholders based on ownership interests. Net losses are not allocated to preferred stockholders as they do not have an obligation to share in the Company’s net losses. For all periods presented and as of the date of this Current Report on Form 10-Q, the Company had and has two classes of common stock outstanding: Class A common stock and Class B common stock. As more fully described in Note 8, the rights of the holders of Class A and Class B common stock were and are identical, except with respect to voting and conversion. Each share of Class A common stock was and is entitled to one (1) vote per share and each share of Class B common stock was and is entitled to ten (10) votes per share. Each share of Class B common stock was and is convertible into one share of Class A common stock at the option of the holder at any time. In addition, each share of Class B common stock was and is automatically convertible into one share of Class A common stock upon any transfer of such share, which is defined to include entering into a voting agreement, whether or not for value, except for certain transfers described in both the Company’s Third Amended and Restated Certificate of Incorporation and Fourth Amended and Restated Certificate of Incorporation, including, without limitation, transfers to certain family members of the transferor stockholder. Upon either the death or voluntary termination of the Company’s Chief Executive Officer, all shares of Class B common stock were and are automatically convertible into one share of Class A common stock. Upon the effectiveness of the Company’s Fourth Amended and Restated Certificate of Incorporation, additional terms of conversion and transfer were implemented. See Note 12 to these Unaudited Condensed Consolidated Financial Statements for additional information regarding the current conversion and transfer terms of the Company’s common stock. Diluted net income (loss) per share gives effect to all potentially dilutive securities. Potential dilutive securities consist of shares of common stock issuable upon the exercise of stock options, shares of common stock issuable upon the vesting of RSUs, and shares of common stock issuable upon the conversion of the outstanding convertible preferred stock. The dilutive effect of these common stock equivalents is reflected in diluted earnings per share by application of the treasury stock method; however, outstanding RSUs, which are contingently issuable upon the achievement of a liquidity event have been excluded from the dilutive share calculation as it was not probable the vesting criteria for these awards would be met in any of the periods presented. For the three and nine months ended September 30, 2017 and 2016, the two-class method was used in the computation of diluted net income per share, as the result was more dilutive. The following table presents a reconciliation of the numerator and denominator used in the calculation of basic and diluted net income (loss) per share: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Numerator: Net income $ 2,379 $ 2,138 $ 10,932 $ 2,659 Net income attributable to participating securities (1,401 ) (1,260 ) (6,446 ) (1,554 ) Net income attributable to common stockholders — basic $ 978 $ 878 $ 4,486 $ 1,105 Net income $ 2,379 $ 2,138 $ 10,932 $ 2,659 Net income attributable to participating securities (1,345 ) (1,222 ) (6,198 ) (1,507 ) Net income attributable to common stockholders — diluted $ 1,034 $ 916 $ 4,734 $ 1,152 Denominator: Weighted-average number of shares of common stock used in computing net income per share attributable to common stockholders — basic 42,262,035 44,692,419 42,168,904 44,665,063 Dilutive effect of share equivalents resulting from stock options 4,305,138 3,376,954 4,141,726 3,375,691 Weighted-average number of shares of common stock used in computing net income per share — diluted 46,567,173 48,069,373 46,310,630 48,040,754 Net income per share attributable to common stockholders: Basic $ 0.02 $ 0.02 $ 0.11 $ 0.02 Diluted $ 0.02 $ 0.02 $ 0.10 $ 0.02 The following potentially dilutive common stock equivalents have been excluded from the calculation of diluted weighted-average shares outstanding for the three and nine months ended September 30, 2017 and 2016, as their effect would have been anti-dilutive for the periods presented: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Stock options outstanding — 1,332,666 816,318 1,226,182 Restricted stock units outstanding 2,353,152 1,124,694 2,353,152 1,124,694 Convertible preferred stock — — — — |
Segment and Geographic Informat
Segment and Geographic Information | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | 11. Segment and Geographic Information The Company has two reportable segments, United States and International. Segment information is presented in the same manner as the Company’s chief operating decision maker (“CODM”), reviews the Company’s operating results in assessing performance and allocating resources. The CODM reviews revenue and operating income (loss) for each reportable segment as a proxy for the operating performance of the Company’s United States and International operations. The Company’s Chief Executive Officer is the CODM on behalf of both reportable segments. The United States segment derives revenues from marketplace subscriptions, advertising services, and other revenues from customers within the United States. The International segment derives revenues from marketplace subscriptions, advertising services, and other revenues from customers outside of the United States. A majority of the Company’s operational overhead expenses, including technology and personnel costs, and other general and administrative costs associated with running the Company’s business, are incurred in the United States and not allocated to the international segment. Assets and costs discretely incurred by reportable segments, including depreciation and amortization, are included in the calculation of reportable segment (loss) income from operations. Segment operating income (loss) does not reflect the transfer pricing adjustments related to the Company’s foreign subsidiaries, which are recorded for statutory reporting purposes. Asset information is assessed and reviewed on a global basis. Information regarding the Company’s operations by segment and geographical area is presented as follows: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Segment revenue: United States $ 80,394 $ 52,435 $ 219,954 $ 136,195 International 2,595 701 6,310 1,182 Total revenue $ 82,989 $ 53,136 $ 226,264 $ 137,377 Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Segment (loss) income from operations: United States $ 9,337 $ 8,351 $ 33,617 $ 16,818 International (6,474 ) (5,094 ) (18,375 ) (12,853 ) Total income from operations $ 2,863 $ 3,257 $ 15,242 $ 3,965 As of September 30, 2017 and December 31, 2016, property and equipment held outside the United States was not material. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | 12. Subsequent Events On October 16, 2017, the Company completed the IPO, in which the Company issued and sold 3,205,000 shares of its Class A common stock, including the full exercise by the underwriters of their option to purchase 705,000 shares of Class A common stock, at a public offering price of $16.00 per share for aggregate gross proceeds of $51.3 million. The Company received approximately $43.0 million in net proceeds after deducting $3.6 million of underwriting discounts and commissions and approximately $4.7 million in offering costs. In addition to shares of Class A common stock issued and sold by the Company, certain selling shareholders sold an aggregate of 7,605,000 shares of Class A common stock, including the full exercise by the underwriters of their option to purchase 705,000 shares of Class A common stock, as part of the IPO. Upon the closing of the IPO, all of the outstanding shares of convertible Preferred Stock automatically converted into 20,188,226 shares of Class A common stock and 40,376,452 shares of Class B common stock. The 40,376,452 shares of Class B common stock subsequently converted into 40,376,452 shares of Class A common stock resulting in a total conversion of all outstanding shares of Preferred Stock into 60,564,678 shares of Class A common stock. Subsequent to the closing of the IPO, there were no shares of Preferred Stock outstanding. Allen & Company LLC acted as an underwriter in the IPO. Immediately prior to the IPO, Allen & Company LLC and its associated persons, including Ian Smith, a member of the Company’s board of directors, beneficially owned shares of the Company’s outstanding preferred stock representing 13.5% of the Company’s outstanding preferred stock. In connection with Allen & Company LLC’s role as an underwriter in the IPO, pursuant to the underwriting agreement, Allen & Company LLC purchased 2,190,200 shares of our Class A common stock in the IPO at $14.88 per share for a total purchase price of $32,590,176, after deducting underwriting discounts and commissions paid to Allen & Company LLC of $2,453,024. Receipt of such proceeds may be deemed to be a related person transaction pursuant to the Company’s related person transaction policy. In connection with the IPO, in October 2017, the Company’s board of directors adopted, and the Company’s stockholders approved, the Omnibus Equity Compensation Plan (the “2017 Plan”) for the purpose of granting incentive stock options, non-qualified stock options, restricted stock, restricted stock units, and other share-based awards to employees, non-employee directors, and consultants. The 2017 Plan is the successor to the Amended and Restated 2015 Equity Incentive Plan (the “2015 Plan”). In conjunction with the adoption of the 2017 Plan, options and RSUs from the 2015 Plan will remain outstanding but no additional grants will be made from the 2015 Plan. Also, in connection with the closing of the IPO, each share of Series A Preferred Stock automatically converted into 6.0000023 shares of common stock, each share of Series B Preferred Stock converted into 6.0000015 shares of common stock, each share of Series C Preferred Stock converted into 6 shares of common stock, each share of Series D Preferred Stock converted into 6.0000159 shares of common stock and each share of Series E Preferred Stock converted into 6 shares of common stock, one-third of which number of shares of common stock was Class A common stock and two thirds of which number of shares of common stock was Class B common stock. Each such share of Class B common stock issued upon conversion of the Preferred Stock was then immediately converted into one share of Class A common stock. Immediately following such conversion, the Company’s Fourth Amended and Restated Certificate of Incorporation became effective. Pursuant to the Fourth Amended and Restated Certificate of Incorporation, the Company is authorized to issue 500,000,000 shares of Class A common stock, 100,000,000 shares of Class B common stock, and 10,000,000 shares of preferred stock, all with a par value of $0.001 per share. The preferred stock is currently undesignated and no preferred stock is outstanding. In addition, pursuant to the Fourth Amended and Restated Certificate of Incorporation, all shares of Class B common stock will automatically convert into shares of Class A common stock, on a share for share basis, upon the date falling after the first to occur of the death of Langley Steinert, the Company’s Chief Executive Officer, President and Chairman, his voluntary termination of all employment with the Company and service on the Company’s board of directors or the sum of the number of shares of capital stock held by Langley Steinert, by any Family Member of Langley Steinert, and by any Permitted Entity of Langley Steinert (as such terms are defined in the Fourth Amended and Restated Certificate of Incorporation), assuming the exercise and settlement in full of all outstanding options and convertible securities and calculated on an as-converted to Class A common stock basis, being less than 9,091,484. Shares of Class B common stock will not automatically convert into shares of Class A common stock upon the termination of Mr. Steinert's status as an officer and director, unless such termination is either made voluntarily by Mr. Steinert or due to Mr. Steinert's death. Once converted into Class A common stock, the converted shares of Class B common stock will not be reissued. In addition, if all shares of Class B common stock are converted into Class A common stock, then any outstanding options or convertible securities with the right to purchase or acquire shares of Class B common stock shall become a right to purchase or acquire shares of Class A common stock. On October 25, 2017, the Company granted a total of 762,704 RSUs with a grant date fair value of $29.01 per share. The total aggregate value of these RSUs is approximately $22.1 million. |
Summary of Significant Accoun20
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying interim condensed consolidated financial statements (the “Unaudited Condensed Consolidated Financial Statements”) are unaudited. These Unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2016 included in the Company’s final prospectus related to the initial public offering (“IPO”), filed with the pursuant to Rule 424(b)(4) under the Securities Act of 1933, as amended, on October 12, 2017 (the “Prospectus”). The Unaudited Condensed Consolidated Financial Statements have been prepared pursuant to the rules and regulations of the SEC. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations. The Unaudited Condensed Consolidated Financial Statements reflect all adjustments, consisting of only normal recurring adjustments, necessary for the fair presentation of the Company’s financial position as of September 30, 2017 and December 31, 2016, results of operations for the three months and nine months ended September 30, 2017 and 2016, and cash flows for the nine months ended September 30, 2017 and 2016. The accompanying Unaudited Condensed Consolidated Financial Statements reflect the application of certain significant accounting policies as described below and elsewhere in these notes to the Unaudited Condensed Consolidated Financial Statements there have been no material changes in the Company's significant accounting policies from those that were disclosed in the Prospectus In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-09, Compensation — Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting |
Principles of Consolidation | Principles of Consolidation The accompanying Unaudited Condensed Consolidated Financial Statements include the accounts of CarGurus, Inc. and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The Company prepares its Unaudited Condensed Consolidated Financial Statements and related disclosures in conformity with GAAP. |
Subsequent Event Considerations | Subsequent Event Considerations The Company considers events or transactions that occur after the balance sheet date but prior to the issuance of the financial statements to provide additional evidence for certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated as required. The Company has evaluated all subsequent events and determined that there are no material recognized or unrecognized subsequent events requiring disclosure, other than those disclosed in this Quarterly Report on Form 10-Q. |
Use of Estimates | Use of Estimates In preparing its Unaudited Condensed Consolidated Financial Statements in accordance with GAAP, the Company is required to make estimates and assumptions that affect the amounts of assets, liabilities, revenue, costs, and expenses, and disclosure of contingent assets and liabilities which are reported in the Unaudited Condensed Consolidated Financial Statements and accompanying disclosures. The accounting estimates that require the most difficult and subjective judgments include revenue recognition and revenue reserves, contingent liabilities, allowances for doubtful accounts, expected future cash flows used to evaluate the recoverability of long-lived assets, the expensing and capitalization of product, technology, and development costs for website development and internal-use software, the determination of the fair value of stock awards issued, stock-based compensation expense, and the recoverability of the Company's net deferred tax assets and related valuation allowance. 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 the Company’s estimates and assumptions. |
Emerging Growth Company Status | Emerging Growth Company Status The Company is an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act, or JOBS Act, and may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies. The Company may take advantage of these exemptions until the Company is no longer an emerging growth company. Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period afforded by the JOBS Act for the implementation of new or revised accounting standards. The Company has elected to use the extended transition period for complying with new or revised accounting standards and as a result of this election, its financial statements may not be comparable to companies that comply with public company effective dates. The Company may take advantage of these exemptions up until December 31, 2022 or such earlier time that it is no longer an emerging growth company. The Company would cease to be an emerging growth company if it has more than $1.07 billion in annual revenue, it has more than $700.0 million in market value of its stock held by non-affiliates (and it has been a public company for at least 12 months, and has filed one annual report on Form 10-K), or it issues more than $1.0 billion of non-convertible debt securities over a three-year period. |
Concentration of Credit Risk | Concentration of Credit Risk T he Company has no significant off-balance sheet risk, such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash, cash equivalents, investments, and trade accounts receivable. The Company maintains its cash, cash equivalents, and investments principally with accredited financial institutions of high credit standing. Although the Company deposits its cash and investments with multiple financial institutions, its deposits, at times, may exceed federally insured limits. Credit risk with respect to accounts receivable is dispersed due to the large number of customers. The Company routinely assesses the creditworthiness of its customers. The Company generally has not experienced any material losses related to receivables from individual customers, or groups of customers. The Company does not require collateral. Due to these factors, no additional credit risk beyond amounts provided for collection losses is believed by management to be probable in the Company's accounts receivable. For the nine months ended September 30, 2017 and the year ended December 31, 2016, no individual customer accounted for more than 10% of total revenue. As of September 30, 2017, three customers accounted for 17%, 15%, and 10% of net accounts receivable, respectively. As of December 31, 2016, two customers accounted for 24% and 15% of net accounts receivable, respectively. No other individual customer accounted for more than 10% of net accounts receivable at September 30, 2017 or December 31, 2016. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies and adopted by the Company on or prior to the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of Effective Date In February 2016, the FASB issued ASU No. 2016-02 , Leases (Topic 842) In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments |
Fair Value of Financial Instruments Including Cash, Cash Equivalents and Investments | The Company considers all highly liquid investments with an original maturity of three months or less at the date of purchase to be cash equivalents. Investments not classified as cash equivalents with maturities less than one year from the balance sheet date are classified as short-term investments, while investments with maturities in excess of one year from the balance sheet date are classified as long-term investments. Management determines the appropriate classification of investments at the time of purchase, and re-evaluates such determination at each balance sheet date. |
Fair Value of Financial Instr21
Fair Value of Financial Instruments Including Cash, Cash Equivalents and Investments (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value Levels, Assets Measured at Fair Value on Recurring Basis | The following tables present, for each of the fair value levels, the Company’s assets that are measured at fair value on a recurring basis at September 30, 2017 and at December 31, 2016: At September 30, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) Significant Other Observable Inputs (Level 2 Inputs) Significant Unobservable Inputs (Level 3 Inputs) Total Assets: Cash equivalents: Money market funds $ 10,627 $ — $ — $ 10,627 Investments: Certificates of deposit — 60,000 — 60,000 Total $ 10,627 $ 60,000 $ — $ 70,627 At December 31, 2016 Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) Significant Other Observable Inputs (Level 2 Inputs) Significant Unobservable Inputs (Level 3 Inputs) Total Assets: Investments: Certificates of deposit $ — $ 44,774 $ — $ 44,774 Total $ — $ 44,774 $ — $ 44,774 |
Schedule of Cash, Cash Equivalents, and Investments | The following is a summary of cash, cash equivalents, and investments as of September 30, 2017 and December 30, 2016. Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value September 30, 2017 Cash and cash equivalents due in 90 days or less $ 25,636 $ — $ — $ 25,636 Investments: Certificates of deposit due in one year or less 60,000 $ 60,000 Total cash, cash equivalents, and investments $ 85,636 $ — $ — $ 85,636 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value December 31, 2016 Cash and cash equivalents due in 90 days or less $ 29,476 $ — $ — $ 29,476 Investments: Certificates of deposit due in one year or less 44,774 $ 44,774 Total cash, cash equivalents, and investments $ 74,250 $ — $ — $ 74,250 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Property Plant And Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consists of the following: At September 30, 2017 At December 31, 2016 Computer equipment 3,009 2,001 Capitalized software 174 114 Website development costs 4,167 2,680 Furniture and fixtures 4,461 3,386 Leasehold improvements 10,646 8,202 Construction in progress 35 119 22,492 16,502 Less accumulated depreciation (6,392 ) (3,722 ) Property and equipment, net $ 16,100 $ 12,780 |
Other Long-Term Assets (Tables)
Other Long-Term Assets (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Other Assets Noncurrent Disclosure [Abstract] | |
Schedule of Other Long-Term Assets | Other long-term assets consists of the following: At September 30, 2017 At December 31, 2016 Deferred IPO issuance costs $ 4,142 $ — Other long-term assets 16 — $ 4,158 $ — |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Accrued Liabilities Current [Abstract] | |
Schedule of Accrued Expenses | Accrued expenses consists of the following: At September 30, 2017 At December 31, 2016 Accrued bonuses $ 5,086 $ 4,662 Accrued commissions 1,520 1,305 Other accrued expenses 3,347 2,417 $ 9,953 $ 8,384 |
Convertible Preferred Stock a25
Convertible Preferred Stock and Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Summary of Preferred Stock | The Company’s Preferred Stock at both September 30, 2017 and December 31, 2016 was as follows: Original Issue Price Per Share Shares Authorized Issued and Outstanding Liquidation Amount Carrying Value Series A Preferred Stock $ 0.525053 3,333,000 2,824,703 $ 1,483 $ 1,483 Series B Preferred Stock $ 0.780899 3,329,497 2,938,486 2,295 2,295 Series C Preferred Stock $ 0.849012 1,648,978 1,550,612 1,316 1,316 Series D Preferred Stock $ 40.642989 1,673,105 1,673,105 68,000 67,872 Series E Preferred Stock $ 54.190650 1,107,202 1,107,202 60,000 59,732 11,091,782 10,094,108 $ 133,094 $ 132,698 |
Summary of Allocation of Stock-
Summary of Allocation of Stock-based Compensation Expense (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Allocation of Stock-based Compensation Expense | Total stock-based compensation expense was allocated as follows: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Cost of revenue $ 6 $ 6 $ 16 $ 14 Sales and marketing expense 35 43 108 119 Product, technology, and development expense 24 28 72 76 General and administrative expense 9 11 28 27 Total $ 74 $ 88 $ 224 $ 236 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Numerator and Denominator Used in Calculation of Basic and Diluted Net (Loss) Income Per Share | The following table presents a reconciliation of the numerator and denominator used in the calculation of basic and diluted net income (loss) per share: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Numerator: Net income $ 2,379 $ 2,138 $ 10,932 $ 2,659 Net income attributable to participating securities (1,401 ) (1,260 ) (6,446 ) (1,554 ) Net income attributable to common stockholders — basic $ 978 $ 878 $ 4,486 $ 1,105 Net income $ 2,379 $ 2,138 $ 10,932 $ 2,659 Net income attributable to participating securities (1,345 ) (1,222 ) (6,198 ) (1,507 ) Net income attributable to common stockholders — diluted $ 1,034 $ 916 $ 4,734 $ 1,152 Denominator: Weighted-average number of shares of common stock used in computing net income per share attributable to common stockholders — basic 42,262,035 44,692,419 42,168,904 44,665,063 Dilutive effect of share equivalents resulting from stock options 4,305,138 3,376,954 4,141,726 3,375,691 Weighted-average number of shares of common stock used in computing net income per share — diluted 46,567,173 48,069,373 46,310,630 48,040,754 Net income per share attributable to common stockholders: Basic $ 0.02 $ 0.02 $ 0.11 $ 0.02 Diluted $ 0.02 $ 0.02 $ 0.10 $ 0.02 |
Schedule of Potentially Dilutive Common Stock Equivalents Excluded from Calculation of Diluted Weighted-average Shares Outstanding | The following potentially dilutive common stock equivalents have been excluded from the calculation of diluted weighted-average shares outstanding for the three and nine months ended September 30, 2017 and 2016, as their effect would have been anti-dilutive for the periods presented: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Stock options outstanding — 1,332,666 816,318 1,226,182 Restricted stock units outstanding 2,353,152 1,124,694 2,353,152 1,124,694 Convertible preferred stock — — — — |
Segment and Geographic Inform28
Segment and Geographic Information (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Summary of Operations by Segment and Geographical Area | Information regarding the Company’s operations by segment and geographical area is presented as follows: Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Segment revenue: United States $ 80,394 $ 52,435 $ 219,954 $ 136,195 International 2,595 701 6,310 1,182 Total revenue $ 82,989 $ 53,136 $ 226,264 $ 137,377 Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Segment (loss) income from operations: United States $ 9,337 $ 8,351 $ 33,617 $ 16,818 International (6,474 ) (5,094 ) (18,375 ) (12,853 ) Total income from operations $ 2,863 $ 3,257 $ 15,242 $ 3,965 |
Organization and Business Des29
Organization and Business Description - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
State of incorporation | Delaware |
Date of incorporation | Jun. 26, 2015 |
Summary of Significant Accoun30
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Summary Of Significant Accounting Policies [Line Items] | |||||
Tax benefits | $ (590,000) | $ (1,226,000) | $ (4,633,000) | $ (1,566,000) | |
Emerging growth company description | The Company would cease to be an emerging growth company if it has more than $1.07 billion in annual revenue, it has more than $700.0 million in market value of its stock held by non-affiliates (and it has been a public company for at least 12 months, and has filed one annual report on Form 10-K), or it issues more than $1.0 billion of non-convertible debt securities over a three-year period | ||||
Debt security maturity period | 3 years | ||||
Description of significant off-balance sheet risk | The Company has no significant off-balance sheet risk, such as foreign exchange contracts, option contracts, or other foreign hedging arrangements. | ||||
Sales Revenue, Net | Concentration of Credit Risk | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Concentration of credit risk, percentage | 10.00% | 10.00% | |||
Net Accounts Receivable | Concentration of Credit Risk | Customer One | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Concentration of credit risk, percentage | 17.00% | 24.00% | |||
Net Accounts Receivable | Concentration of Credit Risk | Customer Two | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Concentration of credit risk, percentage | 15.00% | 15.00% | |||
Net Accounts Receivable | Concentration of Credit Risk | Customer Three | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Concentration of credit risk, percentage | 10.00% | ||||
Minimum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Annual gross revenue | $ 1,070,000,000 | ||||
Market value of common stock held by non-affiliates | 700,000,000 | 700,000,000 | |||
Non convertible debt securities | 1,000,000,000 | ||||
Accounting Standards Update 2016-09 | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Tax benefits | $ 267,000 | $ 640,000 |
Fair Value of Financial Instr31
Fair Value of Financial Instruments Including Cash, Cash Equivalents and Investments - Schedule of Fair Value Levels, Assets Measured at Fair Value on Recurring Basis (Details) - Fair Value Measurements Recurring Basis - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total | $ 70,627 | $ 44,774 |
Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total | 10,627 | |
Significant Other Observable Inputs (Level 2 Inputs) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total | 60,000 | 44,774 |
Money Market Funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 10,627 | |
Money Market Funds | Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents: | 10,627 | |
Certificates of Deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments: | 60,000 | 44,774 |
Certificates of Deposit | Significant Other Observable Inputs (Level 2 Inputs) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments: | $ 60,000 | $ 44,774 |
Fair Value of Financial Instr32
Fair Value of Financial Instruments Including Cash, Cash Equivalents and Investments - Schedule of Cash, Cash Equivalents, and Investments (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Amortized Cost | ||
Cash And Cash Equivalents [Line Items] | ||
Cash and cash equivalents due in 90 days or less | $ 25,636 | $ 29,476 |
Certificates of deposit due in one year or less | 60,000 | 44,774 |
Total cash, cash equivalents, and investments | 85,636 | 74,250 |
Estimated Fair Value | ||
Cash And Cash Equivalents [Line Items] | ||
Cash and cash equivalents due in 90 days or less | 25,636 | 29,476 |
Certificates of deposit due in one year or less | 60,000 | 44,774 |
Total cash, cash equivalents, and investments | $ 85,636 | $ 74,250 |
Fair Value of Financial Instr33
Fair Value of Financial Instruments Including Cash, Cash Equivalents and Investments - Additional Information (Details) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2017 | Dec. 31, 2016 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Maturity of certificates of deposit, description | Certificates of deposit at September 30, 2017 had maturity dates ranging from nine to twelve months. Certificates of deposit at December 31, 2016 had maturity dates ranging from six to twelve months. | |
Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Maturity period of certificates of deposit | 9 months | 6 months |
Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Maturity period of certificates of deposit | 12 months | 12 months |
Property and Equipment, Net - S
Property and Equipment, Net - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 22,492 | $ 16,502 |
Less accumulated depreciation | (6,392) | (3,722) |
Property and equipment, net | 16,100 | 12,780 |
Computer Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 3,009 | 2,001 |
Capitalized Software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 174 | 114 |
Website Development Costs | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 4,167 | 2,680 |
Furniture and Fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 4,461 | 3,386 |
Leasehold Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 10,646 | 8,202 |
Construction in Progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 35 | $ 119 |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Property Plant And Equipment [Abstract] | ||||
Depreciation and amortization | $ 1,083 | $ 545 | $ 2,670 | $ 1,381 |
Other Long-Term Assets - Schedu
Other Long-Term Assets - Schedule of Other Long-Term Assets (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Property Plant And Equipment [Abstract] | ||
Deferred IPO issuance costs | $ 4,142,000 | $ 0 |
Other long-term assets | 16,000 | |
Total other long-term assets | $ 4,158,000 |
Other Long-Term Assets - Additi
Other Long-Term Assets - Additional Information (Details) - USD ($) | Sep. 30, 2017 | Dec. 31, 2016 |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Deferred IPO issuance costs | $ 4,142,000 | $ 0 |
Accrued Expenses - Schedule of
Accrued Expenses - Schedule of Accrued Expenses (Details) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Accrued Liabilities Current [Abstract] | ||
Accrued bonuses | $ 5,086 | $ 4,662 |
Accrued commissions | 1,520 | 1,305 |
Other accrued expenses | 3,347 | 2,417 |
Accrued expenses, Total | $ 9,953 | $ 8,384 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) | Sep. 26, 2017USD ($)ft² | Sep. 30, 2017USD ($) | Dec. 31, 2016USD ($) |
Commitments And Contingencies [Line Items] | |||
Restricted cash | $ 1,783,000 | $ 2,044,000 | |
Cost for guarantees and indemnities | $ 0 | $ 0 | |
Upper Hatch Street, Dublin, Ireland | |||
Commitments And Contingencies [Line Items] | |||
Square feet of rentable office space | ft² | 13,326 | ||
Lease expiration date | Aug. 11, 2023 | ||
Rent expense | $ 500,000 |
Convertible Preferred Stock a40
Convertible Preferred Stock and Stockholders' Equity - Additional Information (Details) - $ / shares | Jun. 21, 2017 | Sep. 30, 2017 | Oct. 16, 2017 | Dec. 31, 2016 |
Class Of Stock [Line Items] | ||||
Preferred stock, shares authorized | 11,091,782 | 11,091,782 | 11,091,782 | |
Preferred stock, par value | $ 0.001 | |||
Common stock exercise feature | the number of shares of common stock as to which each outstanding option to purchase common stock is exercisable for and each outstanding restricted stock unit (“RSU”) is convertible into was adjusted such that upon exercise of outstanding stock options or vesting of outstanding RSUs, each holder will receive two (2) fully paid and non-assessable shares of Class A common stock and four (4) fully paid and non-assessable shares of Class B common stock in respect of each share of common stock previously underlying such option or RSU | |||
Percentage of common stock exercise price adjusted | 0.167% | |||
Percentage of common stock fair value adjusted prior to recapitalization | 0.167% | |||
Class A Common Stock | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares authorized | 120,020,700 | 120,020,700 | 120,020,700 | |
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |
Common stock conversion terms | each share of Class A common stock issued and outstanding was recapitalized, reclassified, and reconstituted into two (2) fully paid and non-assessable shares of outstanding Class A common stock and four (4) fully paid and non-assessable shares of outstanding Class B common stock | |||
Number of shares issued upon exercise of outstanding stock options or vesting of outstanding RSUs | 2 | |||
Convertible preferred stock, terms of conversion | in connection with the closing of the Company’s IPO, each share of Preferred Stock was converted into approximately six shares of Class A common stock pursuant to the terms of the Third Amended and Restated Certificate of Incorporation. | |||
Class A Common Stock | Subsequent Event | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares authorized | 500,000,000 | |||
Common stock, par value | $ 0.001 | |||
Convertible preferred stock converted into common stock | 6 | |||
Class A Common Stock | Class A Common Stock Recapitalized, Reclassified And Reconstituted [Member] | ||||
Class Of Stock [Line Items] | ||||
Common stock issued in conversion | 2 | |||
Class A Common Stock | Class B Common Stock Recapitalized, Reclassified And Reconstituted [Member] | ||||
Class Of Stock [Line Items] | ||||
Common stock issued in conversion | 2 | |||
Class B Common Stock | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares authorized | 80,013,800 | 80,013,800 | 80,013,800 | |
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |
Common stock conversion terms | each share of Class B common stock of the Corporation issued and outstanding was recapitalized, reclassified, and reconstituted into two (2) fully paid and non-assessable shares of outstanding Class A common stock and four (4) fully paid and non-assessable shares of outstanding Class B common stock. | |||
Number of shares issued upon exercise of outstanding stock options or vesting of outstanding RSUs | 4 | |||
Class B Common Stock | Subsequent Event | ||||
Class Of Stock [Line Items] | ||||
Common stock, shares authorized | 100,000,000 | |||
Common stock, par value | $ 0.001 | |||
Class B Common Stock | Class A Common Stock Recapitalized, Reclassified And Reconstituted [Member] | ||||
Class Of Stock [Line Items] | ||||
Common stock issued in conversion | 4 | |||
Class B Common Stock | Class B Common Stock Recapitalized, Reclassified And Reconstituted [Member] | ||||
Class Of Stock [Line Items] | ||||
Common stock issued in conversion | 4 | |||
Series A Preferred Stock | ||||
Class Of Stock [Line Items] | ||||
Preferred stock, shares authorized | 3,333,000 | 3,333,000 | 3,333,000 | |
Series B Preferred Stock | ||||
Class Of Stock [Line Items] | ||||
Preferred stock, shares authorized | 3,329,497 | 3,329,497 | 3,329,497 | |
Series C Preferred Stock | ||||
Class Of Stock [Line Items] | ||||
Preferred stock, shares authorized | 1,648,978 | 1,648,978 | 1,648,978 | |
Series D Preferred Stock | ||||
Class Of Stock [Line Items] | ||||
Preferred stock, shares authorized | 1,673,105 | 1,673,105 | 1,673,105 | |
Series E Preferred Stock | ||||
Class Of Stock [Line Items] | ||||
Preferred stock, shares authorized | 1,107,202 | 1,107,202 | 1,107,202 |
Convertible Preferred Stock a41
Convertible Preferred Stock and Stockholders' Equity - Common Stock - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2017Voteshares | |
Class Of Stock [Line Items] | |
Common stock conversion feature | each share of Class B common stock was convertible into one share of Class A common stock at the option of the holder at any time. |
Common stock automatic conversion basis | Upon either the death or voluntary termination of the Company’s Chief Executive Officer, all shares of Class B common stock will automatically be converted into one share of Class A common stock. |
Class A Common Stock | |
Class Of Stock [Line Items] | |
Common stock voting rights | one (1) vote for each share |
Number of votes entitled to stockholders per share | Vote | 1 |
Class B Common Stock | |
Class Of Stock [Line Items] | |
Common stock voting rights | ten votes for each share |
Number of votes entitled to stockholders per share | Vote | 10 |
Class of share converted to another class | one share of Class A common stock |
Conversion of stock | shares | 1 |
Class B Common Stock | Chief Executive Officer | |
Class Of Stock [Line Items] | |
Class of share converted to another class | one share of Class A common stock |
Conversion of stock | shares | 1 |
Convertible Preferred Stock a42
Convertible Preferred Stock and Stockholders' Equity - Preferred Stock - Additional Information (Details) - USD ($) $ in Thousands | Aug. 23, 2016 | Sep. 30, 2017 | Dec. 31, 2016 |
Series E Preferred Stock | |||
Class Of Stock [Line Items] | |||
Financing amount, net of issuance costs | $ 59,732 | ||
Stock issuance costs | 268 | ||
Series E Preferred Stock | Retained Earnings | |||
Class Of Stock [Line Items] | |||
Deemed dividend | $ (32,087) | ||
Class A Common Stock | |||
Class Of Stock [Line Items] | |||
Common stock reserved for conversion of outstanding preferred stock | 20,188,226 | 20,188,226 | |
Class B Common Stock | |||
Class Of Stock [Line Items] | |||
Common stock reserved for conversion of outstanding preferred stock | 40,376,452 | 40,376,452 |
Convertible Preferred Stock a43
Convertible Preferred Stock and Stockholders' Equity - Summary of Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | Sep. 30, 2017 | Jun. 21, 2017 | Dec. 31, 2016 |
Temporary Equity [Line Items] | |||
Shares Authorized | 11,091,782 | 11,091,782 | 11,091,782 |
Issued | 10,094,108 | 10,094,108 | |
Outstanding | 10,094,108 | 10,094,108 | |
Liquidation Amount | $ 133,094 | $ 133,094 | |
Convertible preferred stock (Note 8) | $ 132,698 | $ 132,698 | |
Series A Preferred Stock | |||
Temporary Equity [Line Items] | |||
Original Issue Price Per Share | $ 0.525053 | $ 0.525053 | |
Shares Authorized | 3,333,000 | 3,333,000 | 3,333,000 |
Issued | 2,824,703 | 2,824,703 | |
Outstanding | 2,824,703 | 2,824,703 | |
Liquidation Amount | $ 1,483 | $ 1,483 | |
Convertible preferred stock (Note 8) | $ 1,483 | $ 1,483 | |
Series B Preferred Stock | |||
Temporary Equity [Line Items] | |||
Original Issue Price Per Share | $ 0.780899 | $ 0.780899 | |
Shares Authorized | 3,329,497 | 3,329,497 | 3,329,497 |
Issued | 2,938,486 | 2,938,486 | |
Outstanding | 2,938,486 | 2,938,486 | |
Liquidation Amount | $ 2,295 | $ 2,295 | |
Convertible preferred stock (Note 8) | $ 2,295 | $ 2,295 | |
Series C Preferred Stock | |||
Temporary Equity [Line Items] | |||
Original Issue Price Per Share | $ 0.849012 | $ 0.849012 | |
Shares Authorized | 1,648,978 | 1,648,978 | 1,648,978 |
Issued | 1,550,612 | 1,550,612 | |
Outstanding | 1,550,612 | 1,550,612 | |
Liquidation Amount | $ 1,316 | $ 1,316 | |
Convertible preferred stock (Note 8) | $ 1,316 | $ 1,316 | |
Series D Preferred Stock | |||
Temporary Equity [Line Items] | |||
Original Issue Price Per Share | $ 40.642989 | $ 40.642989 | |
Shares Authorized | 1,673,105 | 1,673,105 | 1,673,105 |
Issued | 1,673,105 | 1,673,105 | |
Outstanding | 1,673,105 | 1,673,105 | |
Liquidation Amount | $ 68,000 | $ 68,000 | |
Convertible preferred stock (Note 8) | $ 67,872 | $ 67,872 | |
Series E Preferred Stock | |||
Temporary Equity [Line Items] | |||
Original Issue Price Per Share | $ 54.190650 | $ 54.190650 | |
Shares Authorized | 1,107,202 | 1,107,202 | 1,107,202 |
Issued | 1,107,202 | 1,107,202 | |
Outstanding | 1,107,202 | 1,107,202 | |
Liquidation Amount | $ 60,000 | $ 60,000 | |
Convertible preferred stock (Note 8) | $ 59,732 | $ 59,732 |
Stock-based Compensation - Addi
Stock-based Compensation - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Oct. 11, 2017 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||||
Total stock-based compensation expense | $ 74,000 | $ 88,000 | $ 224,000 | $ 236,000 | |
Unrecognized stock-based compensation expense related to stock options | 500,000 | 500,000 | |||
Unrecognized stock-based compensation expense related to stock-based awards | 0 | $ 0 | |||
Subsequent Event | |||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||||
Unrecognized stock-based compensation expense related to stock-based awards | $ 2,500,000 | ||||
Stock Options | |||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||||
Unrecognized stock-based compensation expense, expected period for recognition | 2 years 1 month 7 days | ||||
RSUs | |||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||||
Unrecognized stock-based compensation expense, expected period for recognition | 3 years 1 month 7 days | ||||
Unrecognized stock-based compensation expense related to stock-based awards | $ 10,100,000 | $ 10,100,000 |
Stock-based Compensation - Summ
Stock-based Compensation - Summary of Allocation of Stock-based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expense | $ 74 | $ 88 | $ 224 | $ 236 |
Cost of Revenue | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expense | 6 | 6 | 16 | 14 |
Sales and Marketing Expense | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expense | 35 | 43 | 108 | 119 |
Product, Technology, and Development Expense | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expense | 24 | 28 | 72 | 76 |
General and Administrative Expense | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Total stock-based compensation expense | $ 9 | $ 11 | $ 28 | $ 27 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2017Voteshares | |
Earnings Per Share Basic [Line Items] | |
Conversion of stock, description | Each share of Class B common stock was and is convertible into one share of Class A common stock at the option of the holder at any time. In addition, each share of Class B common stock was and is automatically convertible into one share of Class A common stock upon any transfer of such share, which is defined to include entering into a voting agreement, whether or not for value, except for certain transfers described in both the Company’s Third Amended and Restated Certificate of Incorporation and Fourth Amended and Restated Certificate of Incorporation, including, without limitation, transfers to certain family members of the transferor stockholder. Upon either the death or voluntary termination of the Company’s Chief Executive Officer, all shares of Class B common stock were and are automatically convertible into one share of Class A common stock. |
Class A Common Stock | |
Earnings Per Share Basic [Line Items] | |
Right to voting | one (1) vote for each share |
Number of votes entitled to stockholders per share | 1 |
Class B Common Stock | |
Earnings Per Share Basic [Line Items] | |
Right to voting | ten votes for each share |
Number of votes entitled to stockholders per share | 10 |
Class of share converted to another class | one share of Class A common stock |
Conversion of stock | shares | 1 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Reconciliation of Numerator and Denominator Used in Calculation of Basic and Diluted Net (Loss) Income Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Numerator: | ||||
Net income | $ 2,379 | $ 2,138 | $ 10,932 | $ 2,659 |
Net income attributable to participating securities | (1,401) | (1,260) | (6,446) | (1,554) |
Net income attributable to common stockholders — basic | 978 | 878 | 4,486 | 1,105 |
Net income attributable to participating securities | (1,345) | (1,222) | (6,198) | (1,507) |
Net income attributable to common stockholders — diluted | $ 1,034 | $ 916 | $ 4,734 | $ 1,152 |
Weighted-average number of shares of common stock used in computing net income per share attributable to common stockholders: | ||||
Weighted-average number of shares of common stock used in computing net income per share attributable to common stockholders — basic | 42,262,035 | 44,692,419 | 42,168,904 | 44,665,063 |
Dilutive effect of share equivalents resulting from stock options | 4,305,138 | 3,376,954 | 4,141,726 | 3,375,691 |
Weighted-average number of shares of common stock used in computing net income per share — diluted | 46,567,173 | 48,069,373 | 46,310,630 | 48,040,754 |
Net income per share attributable to common stockholders: (Note 10) | ||||
Basic | $ 0.02 | $ 0.02 | $ 0.11 | $ 0.02 |
Diluted | $ 0.02 | $ 0.02 | $ 0.10 | $ 0.02 |
Earnings Per Share - Schedule48
Earnings Per Share - Schedule of Potentially Dilutive Common Stock Equivalents Excluded from Calculation of Diluted Weighted-average Shares Outstanding (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Stock Options Outstanding | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Potentially dilutive common stock equivalents excluded from calculation of diluted weighted-average shares outstanding | 1,332,666 | 816,318 | 1,226,182 | |
Restricted Stock Units Outstanding | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Potentially dilutive common stock equivalents excluded from calculation of diluted weighted-average shares outstanding | 2,353,152 | 1,124,694 | 2,353,152 | 1,124,694 |
Segment and Geographic Inform49
Segment and Geographic Information - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2017Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Segment and Geographic Inform50
Segment and Geographic Information - Summary of Operations by Segment and Geographical Area (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Segment revenue: | ||||
Revenue | $ 82,989 | $ 53,136 | $ 226,264 | $ 137,377 |
Segment (loss) income from operations: | ||||
Total income from operations | 2,863 | 3,257 | 15,242 | 3,965 |
United States | ||||
Segment revenue: | ||||
Revenue | 80,394 | 52,435 | 219,954 | 136,195 |
Segment (loss) income from operations: | ||||
Total income from operations | 9,337 | 8,351 | 33,617 | 16,818 |
International | ||||
Segment revenue: | ||||
Revenue | 2,595 | 701 | 6,310 | 1,182 |
Segment (loss) income from operations: | ||||
Total income from operations | $ (6,474) | $ (5,094) | $ (18,375) | $ (12,853) |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - USD ($) | Oct. 25, 2017 | Oct. 16, 2017 | Aug. 23, 2016 | Oct. 31, 2017 | Sep. 30, 2017 | Jun. 21, 2017 | Dec. 31, 2016 |
Class A Common Stock | |||||||
Subsequent Event [Line Items] | |||||||
Convertible preferred stock, terms of conversion | in connection with the closing of the Company’s IPO, each share of Preferred Stock was converted into approximately six shares of Class A common stock pursuant to the terms of the Third Amended and Restated Certificate of Incorporation. | ||||||
Common stock, shares authorized | 120,020,700 | 120,020,700 | 120,020,700 | ||||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | ||||
Class B Common Stock | |||||||
Subsequent Event [Line Items] | |||||||
Common stock, shares authorized | 80,013,800 | 80,013,800 | 80,013,800 | ||||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | ||||
Series E Preferred Stock | |||||||
Subsequent Event [Line Items] | |||||||
Stock issuance costs | $ 268,000 | ||||||
IPO | |||||||
Subsequent Event [Line Items] | |||||||
Convertible preferred stock, terms of conversion | Also, in connection with the closing of the IPO, each share of Series A Preferred Stock automatically converted into 6.0000023 shares of common stock, each share of Series B Preferred Stock converted into 6.0000015 shares of common stock, each share of Series C Preferred Stock converted into 6 shares of common stock, each share of Series D Preferred Stock converted into 6.0000159 shares of common stock and each share of Series E Preferred Stock converted into 6 shares of common stock, one-third of which number of shares of common stock was Class A common stock and two thirds of which number of shares of common stock was Class B common stock. Each such share of Class B common stock issued upon conversion of the Preferred Stock was then immediately converted into one share of Class A common stock. | ||||||
Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Conversion of convertible securities into shares of common stock | 9,091,484 | ||||||
Preferred stock, shares outstanding | 0 | ||||||
Preferred stock, shares authorized | 10,000,000 | ||||||
Preferred stock, par value | $ 0.001 | ||||||
Subsequent Event | RSUs | |||||||
Subsequent Event [Line Items] | |||||||
RSUs granted | 762,704 | ||||||
RSUs grant date fair value per share | $ 29.01 | ||||||
RSUs granted, aggregate value | $ 22,100,000 | ||||||
Subsequent Event | Amended and Restated 2015 Equity Incentive Plan | |||||||
Subsequent Event [Line Items] | |||||||
Additional shares granted under plan | 0 | ||||||
Subsequent Event | Class A Common Stock | |||||||
Subsequent Event [Line Items] | |||||||
Conversion of convertible securities into shares of common stock | 60,564,678 | ||||||
Convertible preferred stock converted into common stock | 6 | ||||||
Common stock, shares authorized | 500,000,000 | ||||||
Common stock, par value | $ 0.001 | ||||||
Subsequent Event | Class A Common Stock | Selling Shareholders | |||||||
Subsequent Event [Line Items] | |||||||
Number of shares issued and sold | 7,605,000 | ||||||
Subsequent Event | Class A Common Stock | Subsequent Conversion | |||||||
Subsequent Event [Line Items] | |||||||
Conversion of convertible securities into shares of common stock | 40,376,452 | ||||||
Subsequent Event | Class B Common Stock | |||||||
Subsequent Event [Line Items] | |||||||
Conversion of convertible securities into shares of common stock | 40,376,452 | ||||||
Common stock, shares authorized | 100,000,000 | ||||||
Common stock, par value | $ 0.001 | ||||||
Subsequent Event | IPO | |||||||
Subsequent Event [Line Items] | |||||||
Preferred stock, shares outstanding | 0 | ||||||
Subsequent Event | IPO | Allen And Company LLC and Associated Persons | |||||||
Subsequent Event [Line Items] | |||||||
Percentage of ownership of outstanding preferred stock | 13.50% | ||||||
Subsequent Event | IPO | Class A Common Stock | |||||||
Subsequent Event [Line Items] | |||||||
Number of shares issued and sold | 3,205,000 | ||||||
Number of shares issued for services | 705,000 | ||||||
Offering price per share | $ 16 | ||||||
Aggregate gross proceeds | $ 51,300,000 | ||||||
Net proceeds received after deducting underwriting discounts and commissions and offering costs | 43,000,000 | ||||||
Underwriting discounts and commissions | 3,600,000 | ||||||
Stock issuance costs | $ 4,700,000 | ||||||
Conversion of convertible securities into shares of common stock | 20,188,226 | ||||||
Subsequent Event | IPO | Class A Common Stock | Allen And Company LLC and Associated Persons | |||||||
Subsequent Event [Line Items] | |||||||
Number of shares issued for services | 2,190,200 | ||||||
Offering price per share | $ 14.88 | ||||||
Aggregate gross proceeds | $ 32,590,176 | ||||||
Underwriting discounts and commissions | $ 2,453,024 | ||||||
Subsequent Event | IPO | Series A Preferred Stock | |||||||
Subsequent Event [Line Items] | |||||||
Convertible preferred stock converted into common stock | 6.0000023 | ||||||
Subsequent Event | IPO | Series B Preferred Stock | |||||||
Subsequent Event [Line Items] | |||||||
Convertible preferred stock converted into common stock | 6.0000015 | ||||||
Subsequent Event | IPO | Series C Preferred Stock | |||||||
Subsequent Event [Line Items] | |||||||
Convertible preferred stock converted into common stock | 6 | ||||||
Subsequent Event | IPO | Series D Preferred Stock | |||||||
Subsequent Event [Line Items] | |||||||
Convertible preferred stock converted into common stock | 6.0000159 | ||||||
Subsequent Event | IPO | Series E Preferred Stock | |||||||
Subsequent Event [Line Items] | |||||||
Convertible preferred stock converted into common stock | 6 |