Document and Entity Information
Document and Entity Information Document - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Apr. 13, 2018 | Jun. 30, 2017 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | IZEA, INC. | ||
Entity Central Index Key | 1,495,231 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Smaller Reporting Company | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | Q4 | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 5,819,246 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 6,861,087 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Assets, Current [Abstract] | |||
Cash and cash equivalents | $ 3,906,797 | $ 5,949,004 | $ 11,608,452 |
Prepaid expenses | 389,104 | 322,377 | 193,455 |
Other current assets | 9,140 | 11,940 | 16,853 |
Total current assets | 7,952,066 | 10,029,016 | 15,736,685 |
Property and equipment, net | 286,043 | 460,650 | 596,008 |
Goodwill | 3,604,720 | 3,604,720 | 2,468,289 |
Intangible assets, net | 667,909 | 1,662,536 | 1,806,191 |
Software development costs, net | 967,927 | 1,103,959 | 813,932 |
Security deposits | 148,638 | 161,736 | 117,946 |
Total assets | 13,627,303 | 17,022,617 | 21,539,051 |
Liabilities, Current [Abstract] | |||
Accounts payable | 1,756,841 | 1,438,389 | 995,275 |
Accrued expenses | 1,592,356 | 1,242,889 | 908,519 |
Unearned revenue | 3,070,502 | 3,315,563 | 3,584,527 |
Current portion of deferred rent | 45,127 | 34,290 | 14,662 |
Capital Lease Obligations, Current | 0 | 0 | 7,291 |
Current portion of acquisition costs payable | 741,155 | 1,252,885 | 844,931 |
Total current liabilities | 7,706,531 | 7,284,016 | 6,355,205 |
Deferred rent, less current portion | 17,419 | 62,547 | 102,665 |
Acquisition costs payable, less current portion | 609,768 | 688,191 | 889,080 |
Warrant liability | 0 | 0 | 5,060 |
Total liabilities | 8,333,718 | 8,034,754 | 7,352,010 |
Commitments and Contingencies | 0 | 0 | 0 |
Stockholders' Equity Attributable to Parent [Abstract] | |||
Preferred stock; $.0001 par value; 10,000,000 shares authorized; no shares issued and outstanding | 0 | 0 | 0 |
Common stock, $.0001 par value; 200,000,000 shares authorized; 5,733,981 and 5,456,118, respectively, issued and outstanding | 573 | 545 | 522 |
Additional paid-in capital | 52,570,432 | 50,797,039 | 48,436,040 |
Accumulated deficit | (47,277,420) | (41,809,721) | (34,249,521) |
Total stockholders’ equity | 5,293,585 | 8,987,863 | 14,187,041 |
Total liabilities and stockholders’ equity | 13,627,303 | 17,022,617 | 21,539,051 |
Secured Line of Credit Facility [Member] | Bridge Bank Credit Agreement [Member] | |||
Assets, Current [Abstract] | |||
Accounts receivable, net | 3,647,025 | $ 3,745,695 | $ 3,917,925 |
Liabilities, Current [Abstract] | |||
Line of credit | $ 500,550 |
Consolidated Balance Sheets Par
Consolidated Balance Sheets Parentheticals - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Parentheticals - Balance Sheet [Abstract] | |||
Preferred stock, par value (per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 | 0 |
Common stock, par value (per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (shares) | 200,000,000 | 200,000,000 | 200,000,000 |
Common stock, shares, issued (shares) | 5,733,981 | 5,456,118 | 5,222,951 |
Common stock, shares outstanding (shares) | 5,733,981 | 5,456,118 | 5,222,951 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||||||
Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue | $ 24,437,649 | |||||||||||||
Costs and expenses: | ||||||||||||||
Cost of revenue (exclusive of amortization) | 11,585,316 | |||||||||||||
Sales and marketing | 7,593,197 | |||||||||||||
General and administrative | 9,218,565 | |||||||||||||
Depreciation and amortization | 1,516,807 | |||||||||||||
Total costs and expenses | 29,913,885 | |||||||||||||
Loss from operations | (5,476,236) | |||||||||||||
Other income (expense): | ||||||||||||||
Interest expense | (64,950) | |||||||||||||
Loss on exchange of warrants | 0 | $ 0 | $ (1,845,810) | |||||||||||
Change in fair value of derivatives, net | 39,269 | |||||||||||||
Other income (expense), net | 34,218 | |||||||||||||
Total other income (expense), net | 8,537 | |||||||||||||
Net loss | $ (5,467,699) | $ (7,560,200) | $ (11,308,171) | |||||||||||
Weighted average common shares outstanding – basic and diluted | 5,674,901 | 5,380,465 | 3,737,897 | |||||||||||
Basic and diluted loss per common share | $ (0.96) | $ (1.41) | $ (3.03) | |||||||||||
Restatement Adjustment [Member] | ||||||||||||||
Revenue | $ 7,089,855 | $ 5,712,904 | $ 4,834,505 | $ 5,883,614 | $ 6,033,930 | $ 5,433,625 | $ 3,883,128 | $ 4,527,841 | $ 3,719,939 | $ 2,877,716 | $ 2,984,189 | $ 21,234,297 | $ 14,109,685 | |
Costs and expenses: | ||||||||||||||
Cost of revenue (exclusive of amortization) | 3,302,626 | 2,714,699 | 2,337,060 | 2,888,292 | 3,060,114 | 2,524,869 | 2,001,494 | 2,342,597 | 2,043,331 | 1,581,732 | 1,630,877 | 10,474,769 | 7,598,537 | |
Sales and marketing | 1,733,178 | 1,886,528 | 2,388,820 | 2,061,786 | 1,988,410 | 2,041,018 | 1,898,376 | 2,157,110 | 1,529,296 | 1,349,151 | 1,250,796 | 7,989,590 | 6,286,353 | |
General and administrative | 2,312,301 | 2,166,370 | 2,446,918 | 2,358,702 | 2,114,966 | 2,210,719 | 2,262,044 | 1,987,277 | 803,320 | 1,921,169 | 1,676,218 | 8,946,431 | 6,387,984 | |
Depreciation and amortization | 374,965 | 358,260 | 362,606 | 364,788 | 339,589 | 299,177 | 296,297 | 428,071 | 230,553 | 226,211 | 174,296 | 1,299,851 | 1,059,131 | |
Total costs and expenses | 7,723,070 | 7,125,857 | 7,535,404 | 7,673,568 | 7,503,079 | 7,075,783 | 6,458,211 | 6,915,055 | 4,606,500 | 5,078,263 | 4,732,187 | 28,710,641 | 21,332,005 | |
Loss from operations | (633,215) | (1,412,953) | (2,700,899) | (1,789,954) | (1,469,149) | (1,642,158) | (2,575,083) | (2,387,214) | (886,561) | (2,200,547) | (1,747,998) | (7,476,344) | (7,222,320) | |
Other income (expense): | ||||||||||||||
Interest expense | (15,058) | (13,272) | (17,076) | (24,683) | (25,511) | (11,411) | (21,339) | (29,507) | (31,191) | (36,393) | (18,770) | (82,944) | (115,861) | |
Loss on exchange of warrants | 0 | (1,845,810) | 0 | 0 | 0 | (1,845,810) | ||||||||
Change in fair value of derivatives, net | 45,160 | (8,420) | (618) | (5,405) | (14,705) | 26,421 | 2,852 | 5,720 | 115,904 | 250,507 | (2,505,951) | 9,163 | (2,133,820) | |
Other income (expense), net | 44,308 | (11,953) | (627) | (9,590) | (2,238) | 803 | 950 | 4,120 | 2,571 | 1,142 | 1,807 | (10,075) | 9,640 | |
Total other income (expense), net | 74,410 | (33,645) | (18,321) | (39,678) | (42,454) | 15,813 | (17,537) | (19,667) | (1,758,526) | 215,256 | (2,522,914) | (83,856) | (4,085,851) | |
Net loss | $ (558,805) | $ (1,446,598) | $ (2,719,220) | $ (1,829,632) | $ (1,511,603) | $ (1,626,345) | $ (2,592,620) | $ (2,406,881) | $ (2,645,087) | $ (1,985,291) | $ (4,270,912) | $ (7,560,200) | $ (11,308,171) | |
Weighted average common shares outstanding – basic and diluted | 5,702,297 | 5,676,629 | 5,598,200 | 5,450,005 | 5,420,020 | 5,350,128 | 5,300,520 | 5,118,139 | 4,075,605 | 2,885,721 | 2,884,883 | 5,380,465 | 3,737,897 | |
Basic and diluted loss per common share | $ (0.10) | $ (0.25) | $ (0.49) | $ (0.34) | $ (0.28) | $ (0.30) | $ (0.49) | $ (0.47) | $ (0.65) | $ (0.69) | $ (1.48) | $ (1.41) | $ (3.03) |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity - USD ($) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] |
Balance (shares) at Dec. 31, 2014 | 2,885,424 | |||
Balance at Dec. 31, 2014 | $ 4,259,475 | $ 289 | $ 27,200,536 | $ (22,941,350) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Fair value of warrants issued | 51,950 | 51,950 | ||
Fair value adjustment of warrants | 7,178,035 | 7,178,035 | ||
Stock issued for payment of acquisition liability (shares) | 31,821 | |||
Stock issued for payment of acquisition liability | 250,000 | $ 3 | 249,997 | |
Warrants exercised during the period, shares | 2,191,547 | |||
Warrants exercised during the period, value | 12,861,057 | $ 219 | 12,860,838 | |
Stock purchase plan issuances (shares) | 13,403 | |||
Stock purchase plan issuances | 76,170 | $ 1 | 76,169 | |
Stock issued for payment of services (shares) | 100,756 | |||
Stock issued for payment of services | 125,992 | $ 10 | 125,982 | |
Stock issuance costs | (12,933) | (12,933) | ||
Stock-based compensation | 705,466 | 705,466 | ||
Net loss | (11,308,171) | (11,308,171) | ||
Balance (shares) at Dec. 31, 2015 | 5,222,951 | |||
Balance at Dec. 31, 2015 | 14,187,041 | $ 522 | 48,436,040 | (34,249,521) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Fair value of warrants issued | 0 | |||
Stock issued for payment of acquisition liability (shares) | 200,605 | |||
Stock issued for payment of acquisition liability | 1,448,832 | $ 20 | 1,448,812 | |
Stock purchase plan issuances (shares) | 11,453 | |||
Stock purchase plan issuances | 58,021 | $ 1 | 58,020 | |
Stock issued for payment of services (shares) | 21,109 | |||
Stock issued for payment of services | 129,794 | $ 2 | 129,792 | |
Stock issuance costs | (23,717) | (23,717) | ||
Stock-based compensation | 748,092 | 748,092 | ||
Net loss | (7,560,200) | (7,560,200) | ||
Balance (shares) at Dec. 31, 2016 | 5,456,118 | |||
Balance at Dec. 31, 2016 | 8,987,863 | $ 545 | 50,797,039 | (41,809,721) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Fair value of warrants issued | 0 | |||
Stock issued for payment of acquisition liability (shares) | 200,542 | |||
Stock issued for payment of acquisition liability | 928,041 | $ 20 | 928,021 | |
Stock purchase plan issuances (shares) | 16,168 | |||
Stock purchase plan issuances | 26,249 | $ 2 | 26,247 | |
Stock issued for payment of services (shares) | 48,879 | |||
Stock issued for payment of services | 155,000 | $ 5 | 154,995 | |
Stock issuance costs | (12,353) | (12,353) | ||
Stock-based compensation (shares) | 12,274 | |||
Stock-based compensation | 676,484 | $ 1 | 676,483 | |
Net loss | (5,467,699) | (5,467,699) | ||
Balance (shares) at Dec. 31, 2017 | 5,733,981 | |||
Balance at Dec. 31, 2017 | $ 5,293,585 | $ 573 | $ 52,570,432 | $ (47,277,420) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of Cash Flows [Abstract] | |||
Net loss | $ (5,467,699) | $ (7,560,200) | $ (11,308,171) |
Adjustments to reconcile net loss to net cash used for operating activities: | |||
Depreciation and amortization | 211,769 | 253,004 | 206,670 |
Amortization of software development costs and other intangible assets | 1,305,038 | 1,046,847 | 852,461 |
(Gain) loss on disposal of equipment | (8,757) | 9,435 | 595 |
Provision for losses on accounts receivable | 40,302 | 163,000 | 163,535 |
Stock-based compensation | 635,427 | 748,092 | 705,466 |
Fair value of stock issued for payment of services | 181,995 | 133,897 | 177,842 |
Increase in fair value of contingent acquisition costs payable | 234,565 | 94,000 | (1,834,300) |
Gain on settlement of acquisition costs payable | (10,491) | 0 | 0 |
Loss on exchange of warrants | 0 | 0 | 1,845,810 |
Change in fair value of derivatives, net | (39,269) | (9,163) | 2,133,820 |
Changes in operating assets and liabilities, net of effects of business acquired: | |||
Accounts receivable | 58,368 | 346,414 | (1,608,561) |
Prepaid expenses and other current assets | (10,596) | (115,927) | 83,244 |
Accounts payable | 318,452 | 443,114 | 141,325 |
Accrued expenses | 463,281 | 17,487 | 582,851 |
Unearned revenue | (245,061) | (268,964) | 1,783,559 |
Deferred rent | (34,291) | (20,490) | 896 |
Net cash used for operating activities | (2,366,967) | (4,719,454) | (6,072,958) |
Cash flows from investing activities: [Abstract] | |||
Purchase of equipment | (28,405) | (122,530) | (187,160) |
Increase in software development costs | (174,379) | (471,219) | (452,571) |
Acquisition, net of cash acquired | 0 | (329,468) | (1,072,055) |
Security deposits | 13,098 | (43,790) | 1,248 |
Net cash used for investing activities | (189,686) | (967,007) | (1,710,538) |
Cash flows from financing activities: [Abstract] | |||
Proceeds from line of credit | 500,550 | 0 | 0 |
Proceeds from stock purchase plan issuances | 26,249 | 58,021 | 76,170 |
Proceeds from Warrant Exercises | 0 | 0 | 12,861,157 |
Stock issuance costs | (12,353) | (23,717) | (12,933) |
Payments on capital lease obligations | 0 | (7,291) | (54,376) |
Net cash from financing activities | 514,446 | 27,013 | 12,870,018 |
Net increase (decrease) in cash and cash equivalents | (2,042,207) | (5,659,448) | 5,086,522 |
Cash and cash equivalents, beginning of year | 5,949,004 | 11,608,452 | 6,521,930 |
Cash and cash equivalents, end of period | 3,906,797 | 5,949,004 | 11,608,452 |
Supplemental cash flow information: [Abstract] | |||
Cash paid during the period for interest | 37,898 | 21,230 | 6,401 |
Non-cash financing and investing activities: | |||
Acquisition costs paid through issuance of common stock | 938,532 | 1,448,832 | 250,000 |
Fair value of common stock issued for future services | 53,331 | 0 | 0 |
Acquisition costs payable for assets acquired | 0 | 0 | 3,942,639 |
Fair value of warrants reclassified from liability to equity | 0 | 0 | 6,530,046 |
Fair value of warrants issued | $ 0 | $ 0 | $ 51,950 |
Company and Summary of Signific
Company and Summary of Significant Accounting Policies (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Business IZEA, Inc. (together with its wholly-owned subsidiaries, “we,” “us,” “our,” “IZEA” or the “Company”) was founded in February 2006 under the name PayPerPost, Inc. and became a public company incorporated in the state of Nevada in May 2011. In January 2015, IZEA purchased all of the outstanding shares of capital stock of Ebyline, Inc. (“Ebyline”). In July 2016, IZEA purchased all the outstanding shares of capital stock of ZenContent, Inc. (“ZenContent”). The legal entity of ZenContent was dissolved in December 2017 after all assets and transactions were transferred to IZEA. On March 9, 2016, the Company formed IZEA Canada, Inc., a wholly-owned subsidiary, incorporated in Ontario, Canada to operate as a sales and support office for IZEA's Canadian customers. The Company is headquartered near Orlando, Florida with additional offices in Illinois, California and Canada. The Company creates and operates online marketplaces that connects marketers with content creators. The creators are compensated by IZEA for producing and distributing unique content such as long and short form text, videos, photos, status updates, and illustrations for marketers or distributing such content on behalf of marketers through their personal websites, blogs, and social media channels. Marketers receive influential consumer content and engaging, shareable stories that drive awareness. The Company's primary technology platform, The IZEA Exchange (“ IZEAx ”), enables transactions to be completed at scale through the management of custom content workflow, creator search and targeting, bidding, analytics, and payment processing. IZEAx is designed to provide a unified ecosystem that enables the creation and publication of multiple types of custom content through a creator's personal websites, blogs, or social media channels including Twitter, Facebook, Instagram, and YouTube among others. In addition to IZEAx , the Company operates the Ebyline technology platform, which it acquired in January 2015. The Ebyline platform was originally designed as a self-service content marketplace to replace editorial newsrooms in the news agencies with a “virtual newsroom” to handle their content workflow. Principles of Consolidation The consolidated financial statements include the accounts of IZEA, Inc. and its wholly-owned subsidiaries, Ebyline after its acquisition on January 27, 2015, ZenContent, Inc. after its acquisition on July 31, 2016 until its closure in December 2017, and IZEA Canada, Inc. after its formation in March 2016. All significant intercompany balances and transactions have been eliminated in consolidation. The consolidated financial statements were prepared using the acquisition method of accounting with IZEA considered the accounting acquirer of Ebyline and ZenContent. Under the acquisition method of accounting, the purchase price is allocated to the underlying tangible and intangible assets acquired and liabilities assumed based on their respective fair market values with any excess purchase price allocated to goodwill. Restatement In connection with the year-end financial statement close process, the process of evaluating the adoption of the new accounting pronouncement for revenue recognition, and preparation of this Annual Report, the Company determined that its previously issued financial statements included in its Annual Reports on Form 10-K for the years ended December 31, 2015 and 2016 and Quarterly Reports on Form 10-Q for each quarterly period for the years ended December 31, 2015 and 2016, and for the first three quarters for the year ended December 31, 2017 (collectively, the “Restated Periods”) should be restated due to classification errors related to the Company's presentation of revenue related to the self-service Content Workflow portion of its revenue and the Company's classification of certain costs within the consolidated statement of operations related to Managed Services. See Notes 2 and 14 for further information and quantitative information on the Restated Periods. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with a maturity of three months or less from the date of purchase to be cash equivalents. Accounts Receivable and Concentration of Credit Risk Accounts receivable are customer obligations due under normal trade terms. Uncollectibility of accounts receivable is not significant since most customers are bound by contract and are required to fund the Company for all the costs of an “opportunity,” defined as an order created by a marketer for a creator to develop or share content on behalf of a marketer. If a portion of the account balance is deemed uncollectible, the Company will either write-off the amount owed or provide a reserve based on the uncollectible portion of the account. Management determines the collectibility of accounts by regularly evaluating individual customer receivables and considering a customer’s financial condition, credit history and current economic conditions. The Company had a reserve of $189,000 , $237,000 , and $139,000 for doubtful accounts as of December 31, 2017 , 2016 , and 2015 , respectively. Management believes that this estimate is reasonable, but there can be no assurance that the estimate will not change as a result of a change in economic conditions or business conditions within the industry, the individual customers or the Company. Any adjustments to this account are reflected in the consolidated statements of operations as a general and administrative expense. Bad debt expense was less than 1% of revenue for the twelve months ended December 31, 2017 , 2016 , and 2015 . Concentrations of credit risk with respect to accounts receivable are typically limited because a large number of geographically diverse customers make up the Company’s customer base, thus spreading the trade credit risk. The Company also controls credit risk through credit approvals, credit limits and monitoring procedures. The Company performs credit evaluations of its customers but generally does not require collateral to support accounts receivable. The Company had no customers that accounted for more than 10% of total accounts receivable at December 31, 2017 and 2016 and one customer that accounted for 13% of total accounts receivable at December 31, 2015 . The Company had no customer that accounted for more than 10% of its revenue during the twelve months ended December 31, 2017 , one customer that accounted for 11% of its revenue during the twelve months ended December 31, 2016 , and one customer that accounted for 12% of its revenue during the twelve months ended December 31, 2015 . Property and Equipment Property and equipment are recorded at cost, or if acquired in a business combination, at the acquisition date fair value. Depreciation and amortization is computed using the straight-line method over the estimated useful lives of the assets as follows: Computer Equipment 3 years Software Costs 3 - 5 years Office Equipment 3 - 10 years Furniture and Fixtures 5 - 10 years Leasehold improvements are amortized over the shorter of the term of the lease or the estimated useful lives of the improvements. Property and equipment under capital leases are depreciated over their estimated useful lives. Expenditures for repairs and maintenance are charged to expense as incurred. Expenditures for betterments and major improvements are capitalized and depreciated over the remaining useful lives of the assets. The carrying amounts of assets sold or retired and the related accumulated depreciation are eliminated in the year of disposal, with resulting gains or losses included in general and administrative expense. Goodwill Goodwill represents the excess of the purchase consideration of an acquired business over the fair value of the underlying net tangible and intangible assets. The Company has goodwill in connection with its acquisition of Ebyline and ZenContent. Goodwill is not amortized, but instead it is tested for impairment at least annually. In the event that management determines that the value of goodwill has become impaired, the Company will record a charge for the amount of impairment during the fiscal quarter in which the determination is made. The Company performs its annual impairment tests of goodwill during the fourth quarter of each year, or more frequently, if certain indicators are present. Goodwill is required to be tested for impairment at the reporting unit level. A reporting unit is an operating segment or one level below the operating segment level, which is referred to as a component. Management identifies its reporting units by assessing whether components (i) have discrete financial information available; (ii) engage in business activities; and (iii) whether a segment manager regularly reviews the component's operating results. Net assets and goodwill of acquired businesses are allocated to the reporting unit associated with the acquired business based on the anticipated organizational structure of the combined entities. If two or more components are deemed economically similar, those components are aggregated into one reporting unit when performing the annual goodwill impairment review. The Company has determined that prior to and after the acquisition of Ebyline and ZenContent, it had, and continues to have, one reporting unit. Intangible Assets The Company acquired the majority of its intangible assets through its acquisition of Ebyline on January 30, 2015 and its acquisition of ZenContent on July 31, 2016. The Company is amortizing the identifiable intangible assets over a period of 12 to 60 months. See Note 5 for further details. Management reviews long-lived assets, including property and equipment, software development costs and other intangible assets, for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. If an evaluation is required, the estimated future undiscounted cash flows associated with the asset are compared with the asset's carrying amount to determine if there has been an impairment, which is calculated as the difference between the fair value of an asset and its carrying value. Estimates of future undiscounted cash flows are based on expected growth rates for the business, anticipated future economic conditions and estimates of residual values. Fair values take into consideration management estimates of risk-adjusted discount rates, which are believed to be consistent with assumptions that marketplace participants would use in their estimates of fair value. For the twelve months ended December 31, 2017 , 2016 , and 2015 , there were no impairment charges associated with the Company's long-lived assets. Software Development Costs In accordance with ASC 350-40, Internal Use Software, the Company capitalizes certain internal use software development costs associated with creating and enhancing internally developed software related to its platforms. Software development activities generally consist of three stages (i) the research and planning stage, (ii) the application and development stage, and (iii) the post-implementation stage. Costs incurred in the planning and post-implementation stages of software development, or other maintenance and development expenses that do not meet the qualification for capitalization are expensed as incurred. Costs incurred in the application and infrastructure development stage, including significant enhancements and upgrades, are capitalized. These costs include personnel and related employee benefits expenses for employees or consultants who are directly associated with and who devote time to software projects, and external direct costs of materials obtained in developing the software. These software development and acquired technology costs are amortized on a straight-line basis over the estimated useful life of five years upon initial release of the software or additional features. See Note 6 for further details. Revenue Recognition The Company derives revenue from managing content services or advertising campaigns for its customers, as well as from making its platforms available to allow customers the ability to purchase content directly from its creators. In January 2017, the Company revised the way it categorizes its revenue streams to more closely align the revenue based on margin profiles and how it currently analyzes the business. The revised categories are as follows: Managed Services, Content Workflow, and Service Fee Revenue. Managed Services is when a marketer (typically a brand, agency or partner) contracts IZEA to provide custom content, influencer marketing or amplification services. Content Workflow is derived from the self-service use of the Company's platforms by marketers to handle their content workflow, from initial content request to payment of content received or distributed. Service Fee Revenue is generated from various service and license fees charged to users of the Company's platforms. The Company recognizes revenue when four basic criteria are met: (i) persuasive evidence of an arrangement exists; (ii) services have been rendered or delivery has occurred; (iii) the fees are fixed or determinable; and (iv) collectibility is reasonably assured. The Company maintains separate arrangements with each marketer and content creator either in the form of a master agreement or terms of service, which specifies the terms of the relationship and access to its platforms, or by statement of work, which specifies the price and the services to be performed, along with other terms. The Company recognizes revenue as the service is being performed, upon delivery of the content or promotion, or upon the completion of a transaction, as detailed further below. The Company assesses whether fees are fixed or determinable based on the contractual terms of the arrangements or when the ordered services are delivered. The Company assesses collectibility based on a number of factors, including the creditworthiness of the customer and payment and transaction history. Revenue is reported depending on whether the Company functions as principal or agent in the transaction. The determination of whether the Company acts as the principal or the agent is highly subjective and requires the Company to evaluate a number of indicators individually and as a whole in order to make its determination. For transactions in which the Company is the principal, revenue is reported on a gross basis for the amount paid by the marketer for the purchase of content or sponsorship, promotion and other related services. The Company records the amounts it pays to its third-party creators as cost of revenue. For transactions in which the Company is the agent, revenue is reported on a net basis for the amount the Company charged to the self-service marketer using the platform, less the amounts the Company paid to its third-party creators providing the service. Based on the Company's evaluations, revenue from Managed Services and Service Fees are reported on a gross basis and revenue from Content Workflow is reported on a net basis. For Managed Services, the Company enters into an agreement to provide services that may require multiple deliverables in the form of: (i) sponsored social items, such as blogs, tweets, photos or videos shared through social network offerings that provide awareness or advertising buzz regarding the marketer's brand; (ii) content promotion, such as click-through advertisements appearing in websites and social media channels; and (iii) original content items, such as a research or news article, informational material or videos that a publisher or other marketer can use. The Company may provide one type or a combination of all types of these deliverables including a management fee on a statement of work for a lump sum fee. These deliverables are to be provided over a stated period that may range from one day to one year. Each item is considered delivered once the custom content has been delivered to the customer or once the content is distributed live through a public or social network. Revenue is accounted for separately on each of the deliverables depending on the type of service provided. The Company recognizes revenue related to influencer marketing services after a marketer's sponsored content is posted through IZEAx and shared through a creator's social network. Management fees from customer campaigns managed by the Company are recognized ratably over the term of the campaign, which may range from a few days to one year. Revenue related to custom content provided to a marketer is recognized when the content is delivered to and accepted by the customer. Payment terms are typically 30 days from the invoice date. If the Company is unable to provide a portion of the services, it may agree with the customer to provide a different type of service or to provide a credit for the value of those services, which may be applied to the existing order or used for future services. The agreement typically provides for a cancellation fee if the agreement is canceled by the customer prior to completion of services. Marketers who use the Company to manage their advertising campaigns or custom content requests may prepay for services or request credit terms. Payments received or billings in advance of completed services are recorded as unearned revenue until earned as described above. For Content Workflow services, the self-service marketer contracts the creators directly to provide or distribute custom content. The Company's platforms control the contracting, description of services, acceptance of and payment for the requested content. This service is used primarily by news agencies or marketers to control the outsourcing of their content and advertising needs. Revenue is recognized when the transaction is completed by the creator and accepted by the marketer. Service Fee Revenue is generated when fees are charged to customers primarily related to subscription fees for different levels of service within a platform, licensing fees for the use of the IZEAx or Ebyline platforms, inactivity fees and early cash-out fees. Fees for subscription or licensing services are recognized straight-line over the term of service, while other fees are recognized at a point in time when the account is deemed inactive or a cash-out below certain minimum thresholds is requested. Effective January 1, 2018, the Company became subject to new guidelines for disclosing and accounting for its revenue from contracts with customers. See further details below under “Recent Accounting Pronouncements.” Advertising Costs Advertising costs are charged to expense as they are incurred, including payments to content creators to promote the Company. Advertising costs charged to operations for the twelve months ended December 31, 2017 , 2016 , and 2015 were approximately $324,000 , $455,000 and $558,000 , respectively. Advertising costs are included in sales and marketing expense in the accompanying consolidated statements of operations. Deferred Rent The Company’s operating leases for its office facilities contain rent abatements and predetermined fixed increases of the base rental rate during the lease terms. The Company accounts for rental expense on a straight-line basis over the lease terms. The Company records the difference between the straight-line expense and the actual amounts paid under the lease as deferred rent in the accompanying consolidated balance sheets. Income Taxes The Company has not recorded federal income tax expense due to the generation of net operating losses. Deferred income taxes are accounted for using the balance sheet approach, which requires recognition of deferred tax assets and liabilities for the expected future consequences of temporary differences between the financial reporting basis and the tax basis of assets and liabilities. A valuation allowance is provided when it is more likely than not that a deferred tax asset will not be realized. The Company incurs minimal state franchise tax in four states, which is included in general and administrative expense in the consolidated statements of operations. The Company identifies and evaluates uncertain tax positions, if any, and recognizes the impact of uncertain tax positions for which there is a less than more-likely-than-not probability of the position being upheld when reviewed by the relevant taxing authority. Such positions are deemed to be unrecognized tax benefits and a corresponding liability is established on the balance sheet. The Company has not recognized a liability for uncertain tax positions. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The Company’s tax years subject to examination by the Internal Revenue Service are 2013, 2014 and 2015. Derivative Financial Instruments Derivative financial instruments are defined as financial instruments or other contracts that contain a notional amount and one or more underlying factors (e.g., interest rate, security price or other variable), require no initial net investment and permit net settlement. Derivative financial instruments may be free-standing or embedded in other financial instruments. Further, derivative financial instruments are initially, and subsequently, measured at fair value and recorded as liabilities or assets. The Company accounts for derivative instruments in accordance with ASC 815, Derivatives and Hedging (“ASC 815”), which requires additional disclosures about the Company’s objectives and strategies for using derivative instruments, how the derivative instruments and related hedged items are accounted for, and how the derivative instruments and related hedging items affect the financial statements. The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risk. Terms of equity instruments are reviewed to determine whether or not they contain embedded derivative instruments that are required under ASC 815 to be accounted for separately from the host contract, and recorded on the balance sheet at fair value. The fair value of derivative liabilities, if any, is required to be revalued at each reporting date, with corresponding changes in fair value recorded in current period operating results. Pursuant to ASC 815, an evaluation of specifically identified conditions is made to determine whether the fair value of warrants issued is required to be classified as equity or as a derivative liability. Fair Value of Financial Instruments The Company’s financial instruments are recorded at fair value. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The valuation techniques are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect certain market assumptions. There are three levels of inputs that may be used to measure fair value: • Level 1 – Valuation based on quoted market prices in active markets for identical assets and liabilities. • Level 2 – Valuation based on quoted market prices for similar assets and liabilities in active markets. • Level 3 – Valuation based on unobservable inputs that are supported by little or no market activity, therefore requiring management’s best estimate of what market participants would use as fair value. Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management. The Company does not have any Level 1 or 2 financial assets or liabilities. The Company’s Level 3 financial liabilities measured at fair value consisted of its acquisition cost liability (see Note 3) as of December 31, 2017 , 2016 , and 2015 , and a warrant liability as of December 31, 2016 and 2015 . Significant unobservable inputs used in the fair value measurement of the warrants include the estimated term and risk-adjusted interest rates. In developing its credit risk assumption used in the fair value of warrants, the Company considered publicly available bond rates and US Treasury Yields. However, since the Company does not have a formal credit-standing, management estimated its standing among various reported levels and grades for use in the model. During all periods, management estimated that the Company's standing was in the speculative to high-risk grades (BB- to CCC in the Standard and Poor's Rating). Significant increases or decreases in the estimated remaining period to exercise or the risk-adjusted interest rate could result in a significantly lower or higher fair value measurement. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash and cash equivalents, accounts receivable, accounts payable, unearned revenue, and accrued expenses. Unless otherwise disclosed, the fair value of the Company’s notes payable obligations approximate their carrying value based upon current rates available to the Company. Stock-Based Compensation Stock-based compensation cost related to stock options granted under the 2011 Equity Incentive Plan and 2011 B Equity Incentive Plan (together, the “2011 Equity Incentive Plans”) (see Note 9) is measured at the grant date, based on the fair value of the award, and is recognized as a straight-lined expense over the employee’s requisite service period. The Company estimates the fair value of each option award on the date of grant using a Black-Scholes option-pricing model that uses the assumptions noted in the table below. The Company estimates the fair value of its common stock using the closing stock price of its common stock on the date of the grant. The Company estimates the volatility of its common stock at the date of grant based on the volatility of comparable peer companies that are publicly traded and have had a longer trading history than itself. The Company determines the expected life based on historical experience with similar awards, giving consideration to the contractual terms, vesting schedules and post-vesting forfeitures. The Company uses the risk-free interest rate on the implied yield currently available on U.S. Treasury issues with an equivalent remaining term approximately equal to the expected life of the award. The Company has never paid any cash dividends on its common stock and does not anticipate paying any cash dividends in the foreseeable future. The Company used the following assumptions for options granted under the 2011 Equity Incentive Plans during the twelve months ended December 31, 2017 , 2016 , and 2015 : Twelve Months Ended 2011 Equity Incentive Plans Assumptions December 31, December 31, December 31, Expected term 6 years 6 years 6 years Weighted average volatility 50.16% 47.95% 55.47% Weighted average risk free interest rate 2.06% 1.58% 1.65% Expected dividends — — — Effective January 1, 2017, the Company considered its accounting for stock options pursuant to ASU No. 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . This ASU is intended to reduce the cost and complexity of accounting for employee share-based payment transactions primarily surrounding the accounting for income taxes upon vesting or exercise of share-based payments and accounting for forfeitures, as well as related financial statement classifications. Although the new standard allows for the non-use of forfeiture estimates, the Company elected to continue the use of estimated forfeitures when accounting for stock-based compensation, because it has an established history of forfeitures for non-vested options. There was no effect on the Company's financial statements as a result of the adoption of this standard. The Company estimates forfeitures when recognizing compensation expense and this estimate of forfeitures is adjusted over the requisite service period based on the extent to which actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures are recognized through a cumulative catch-up adjustment, which is recognized in the period of change, and a revised amount of unamortized compensation expense to be recognized in future periods. Average expected forfeiture rates were 8.58% , 9.52% , and 8.32% during the twelve months ended December 31, 2017 , 2016 , and 2015 , respectively. Non-Employee Stock-Based Payments The Company's accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of ASC 505, “Equity-Based Payments to Non-Employees.” The measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor's performance is complete. The fair value of equity instruments issued to consultants that vest immediately is expensed when issued. The fair value of equity instruments issued to consultants that have future vesting and are subject to forfeiture if performance does not occur is recognized as expense over the vesting period. Fair values for the unvested portion of issued instruments are adjusted each reporting period. The change in fair value is recorded in the accompanying consolidated statements of operations. Stock-based payments related to non-employees is accounted for based on the fair value of the related stock or the fair value of the services, whichever is more readily determinable. Segment Information The Company does not identify separate operating segments for management reporting purposes. The results of consolidated operations are the basis on which management evaluates operations and makes business decisions. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Reclassifications Certain items have been reclassified in the 2016 financial statements to conform to the 2017 presentation. The Company has reclassified wages and other expenses related to its campaign fulfillment personnel out of sales and marketing expense and into cost of revenue (see Notes 2 and 12 for additional details). Additionally, the Company has reclassified its depreciation and amortization expenses out of general and administrative expense and into a separately stated line item labeled depreciation and amortization within the accompanying consolidated statements of operations. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) and has subsequently issued additional guidance materials under ASU No. 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net), ASU No. 2016-10, Identifying Performance Obligations and Licensing, and ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients (collectively “ASC 606”), which supersedes nearly all existing revenue recognition guidance under GAAP. Under ASC 606, revenue will be recognized based on a five-step model and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing GAAP. The Company has reviewed its sources of revenue in accordance with each of the five steps in the model, which are as follows: (i) identify the contract with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) performance obligations are satisfied. The core principle of ASC 606 is that revenue will be recognized when the transfer of promised goods |
Restatement (Notes)
Restatement (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
Accounting Changes and Error Corrections [Text Block] | RESTATEMENT In connection with the year-end financial statement close, the process of evaluating the adoption of the new accounting pronouncement for revenue recognition, and preparation of this Annual Report, the Company determined that its previously issued financial statements included in its Annual Reports on Form 10-K for the years ended December 31, 2015 and 2016 and Quarterly Reports on Form 10-Q for each quarterly period for the years ended December 31, 2015 and 2016, and for the first three quarters for the year ended December 31, 2017 (collectively, the “Restated Periods”) should be restated due to classification errors related to the Company's presentation of revenue related to the self-service Content Workflow portion of its revenue and the Company's classification of cost of revenue related to Managed Services. The Company historically reported revenue from Content Workflow transactions as the gross amounts billed to marketers for their transactions, because the Company previously concluded that it was a principal in these transactions. The Company has determined that it is more appropriately considered as an agent arranging the sale between its self-service customers and its creators in the Content Workflow transactions, which requires reporting revenue on a net transaction basis. As such, the direct costs associated with these transactions previously reported as cost of revenue should be netted directly against revenue in the Company's consolidated statements of operations. The Company also determined that cost of revenue related to Managed Services should not only include the direct cost of the content that was being purchased by the Company's customers, but should also include the cost of its internal personnel responsible for fulfilling these services. The Company historically considered and reported the cost of its campaign fulfillment personnel as part of its sales and marketing expenses. As part of the restatement process, the Company has elected to present depreciation and amortization expense as a separate line item for better visibility of this expense. Additionally, the Company has elected to change its consolidated statement of operations presentation from a two-step presentation, where cost of sales are deducted from revenue to report a gross profit line, to a one-step presentation, where total costs and expenses are deducted from revenue. Because the Company reports some of its revenue on a gross basis and other portions of its revenue on a net basis, the Company believes that this presents a more appropriate representation of its business operations. The adjustments necessary to correct the errors, the reclassifications and change in the consolidated statement of operations presentation have no impact on the Company's previously reported loss from operations, net loss, loss per share, or on any of the Company's consolidated balance sheets, statements of cash flows, and statements of stockholders' equity. The impact of the restatement on the Company's consolidated statement of operations as of December 31, 2016 and 2015 (based on the Company's current consolidated statement of operations presentation) is as follows: Twelve Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 27,310,602 $ (6,076,305 ) $ — $ 21,234,297 Costs and expenses: Cost of revenue (exclusive of amortization) 14,242,244 (6,076,305 ) 2,308,830 10,474,769 Sales and marketing 10,261,910 (2,272,320 ) 7,989,590 General and administrative 10,282,792 (36,510 ) (1,299,851 ) 8,946,431 Depreciation and amortization — 1,299,851 1,299,851 Total costs and expenses 34,786,946 (6,076,305 ) — — 28,710,641 Loss from operations (7,476,344 ) — — — (7,476,344 ) Other income (expense): Interest expense (82,944 ) (82,944 ) Change in fair value of derivatives, net 9,163 9,163 Other income (expense), net (10,075 ) (10,075 ) Total other income (expense), net (83,856 ) — — — (83,856 ) Net loss $ (7,560,200 ) $ — $ — $ — $ (7,560,200 ) Weighted average common shares outstanding – basic and diluted 5,380,465 5,380,465 Basic and diluted loss per common share $ (1.41 ) $ (1.41 ) Twelve Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 20,467,926 $ (6,358,241 ) $ — $ 14,109,685 Costs and expenses: Cost of revenue (exclusive of amortization) 12,236,916 (6,358,241 ) 1,719,862 7,598,537 Sales and marketing 7,936,215 (1,649,862 ) 6,286,353 General and administrative 7,517,115 (70,000 ) (1,059,131 ) 6,387,984 Depreciation and amortization — 1,059,131 1,059,131 Total costs and expenses 27,690,246 (6,358,241 ) — — 21,332,005 Loss from operations (7,222,320 ) — — — (7,222,320 ) Other income (expense): Interest expense (115,861 ) (115,861 ) Loss on exchange of warrants (1,845,810 ) (1,845,810 ) Change in fair value of derivatives, net (2,133,820 ) (2,133,820 ) Other income (expense), net 9,640 9,640 Total other income (expense), net (4,085,851 ) — — — (4,085,851 ) Net loss $ (11,308,171 ) $ — $ — $ — $ (11,308,171 ) Weighted average common shares outstanding – basic and diluted 3,737,897 3,737,897 Basic and diluted loss per common share $ (3.03 ) $ (3.03 ) See Note 14 for information for each unaudited quarterly period for the years ended December 31, 2015 and 2016, and for the unaudited first three quarters for the year ended December 31, 2017. |
Business Acquisitions (Notes)
Business Acquisitions (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Business Combination Disclosure [Text Block] | BUSINESS ACQUISITIONS EBYLINE, INC. On January 30, 2015, the Company purchased all of the outstanding shares of capital stock of Ebyline pursuant to the terms of a Stock Purchase Agreement, dated as of January 27, 2015, by and among IZEA, Ebyline and the stockholders of Ebyline (the “Ebyline Stock Purchase Agreement”) for a maximum purchase price of $8,850,000 . The Ebyline Stock Purchase Agreement was made up of a combination of guaranteed payments and contingent performance payments to be paid if Ebyline met certain revenue targets in the three years following the closing. None of these targets were met; therefore no amounts are due for contingent performance payments. Therefore, the total consideration paid for the Ebyline acquisition was $3,327,064 . Purchase Price and Acquisition Costs Payable Estimated Gross Purchase Consideration Initial Present and Fair Value Remaining Present and Fair Value Remaining Present and Fair Value Remaining Present and Fair Value 1/30/2015 1/30/2015 12/31/2015 12/31/2016 12/31/2017 Cash paid at closing (a) $ 1,200,000 $ 1,200,000 $ — $ — $ — Guaranteed purchase price (a) 2,127,064 1,982,639 1,823,711 934,728 — Contingent performance payments (b) 2,210,000 1,834,300 — — — Acquisition costs payable by Ebyline shareholders(c) — — (89,700 ) — — Total estimated consideration $ 5,537,064 $ 5,016,939 $ 1,734,011 $ 934,728 $ — Current portion of acquisition costs payable $ 844,931 $ 934,728 $ — Long term portion of acquisition costs payable 889,080 — — Total acquisition costs payable $ 1,734,011 $ 934,728 $ — (a) The Ebyline Stock Purchase Agreement required a $1,200,000 cash payment at closing, a $250,000 stock payment on July 30, 2015 and a cash or stock payment of up to an additional $1,900,000 ( subject to proportional reduction in the event Ebyline’s final 2014 revenue was below $8,000,000 ). Ebyline's final gross revenue for 2014 was $7,903,429 . As such, the additional amount owed became $1,877,064 payable in two equal installments of $938,532 on January 30, 2016 and January 30, 2017. This guaranteed purchase price consideration was discounted to present value using the Company's borrowing rate of prime plus 2% . Interest expense imputed on the acquisition costs payable in the accompanying consolidated statements of operations was $3,804 , $49,549 , and $91,072 for the twelve months ended December 31, 2017 , 2016 , and 2015 , respectively. Per the Ebyline Stock Purchase Agreement, the Company issued 31,821 shares of its common stock to satisfy the $250,000 guaranteed purchase price payment obligation on July 30, 2015. On January 29, 2016, the Company issued 114,398 shares of its common stock to satisfy the $848,832 annual guaranteed payment of $938,532 less $89,700 in closing related expenses (see item (c) below). On January 30, 2017, the Company issued 200,542 shares of common stock to satisfy the final annual guaranteed payment of $938,532 . The Company recorded a $10,491 gain on the settlement of the acquisition costs payable in the accompanying consolidated statements of operations as a result of the difference between the market price of the stock on the settlement date and the 30-day average price of the stock required by the Ebyline Stock Purchase Agreement. (b) Total contingent performance payments up to $5,500,000 are to be paid based on Ebyline meeting certain revenue targets. The performance payments are to be made only if Ebyline achieves at least 90% of Content Revenue targets of $17,000,000 in 2015, $27,000,000 in 2016 and $32,000,000 in 2017. These revenue targets were assumed on a gross transaction basis. The initial fair value of the $5,500,000 of contingent performance payments was calculated using a Monte-Carlo simulation to simulate revenue over three years. Since the contingent consideration has an option like structure, a risk-neutral framework was considered appropriate for the valuation. The Company started with a risk-adjusted measure of forecasted revenue (using a risk-adjusted discount rate of 8.5% ) and assumed it will follow geometric brownian motion to simulate the revenue at future dates. Once the initial revenue was estimated based off of projections made during the acquisition, payout was calculated for each year and present valued to incorporate the credit risk associated with these payments. The Company's initial value conclusion was based on the average payment from 100,000 simulation trials. The volatility used for the simulation was 35% . The Monte Carlo simulation resulted in an initial calculated fair value of contingent performance payments of $2,210,000 on January 30, 2015 . Because the contingent performance payments are subject to a 17% reduction related to the continued employment of certain key employees, ASC 805-10-55-25 indicates that a portion of these payments be treated as potential compensation to be accrued over the term rather than allocated to the purchase price. Therefore, the Company reduced its overall purchase price consideration by $357,700 and recorded the initial present value of the contingent performance payments at $1,834,300 . The Content Revenue from 2015-2017 was below 90% of all of the required Content Revenues targets. Therefore, the Company reduced the fair value of contingent performance payments to zero by the end of 2015. The $1,834,300 decrease in the estimated fair value of contingent performance payments was recorded as a reduction of general and administrative expense in the Company's consolidated statement of operations during the year ended December 31, 2015 . (c) According to the Ebyline Stock Purchase Agreement, $89,700 in closing related expenses paid by Ebyline during the acquisition process were payable by the selling shareholders. These costs were deducted from the guaranteed payment on January 30, 2016. ZENCONTENT, INC. On July 31, 2016, the Company purchased all of the outstanding shares of capital stock of ZenContent pursuant to the terms of a Stock Purchase Agreement, by and among IZEA, ZenContent and the stockholders of ZenContent (the “ZenContent Stock Purchase Agreement”) for a maximum purchase price to be paid over the next three years of $4,500,000 . Purchase Price and Acquisition Costs Payable Estimated Gross Purchase Consideration Initial Present and Fair Value Remaining Present and Fair Value Remaining Present and Fair Value 7/31/2016 7/31/2016 12/31/2016 12/31/2017 Cash paid at closing (a) $ 400,000 $ 400,000 $ — $ — Stock paid at closing (a) 600,000 600,000 — — Guaranteed purchase price (b) 933,565 566,547 682,348 606,413 Contingent performance payments (c) 2,500,000 230,000 324,000 744,510 Total estimated consideration $ 4,433,565 $ 1,796,547 $ 1,006,348 $ 1,350,923 Current portion of acquisition costs payable $ 318,157 $ 741,155 Long-term portion of acquisition costs payable 688,191 609,768 Total acquisition costs payable $ 1,006,348 $ 1,350,923 (a) The aggregate consideration paid at closing for the acquisition of ZenContent consisted of a cash payment of $400,000 and the issuance of 86,207 shares of IZEA common stock valued at $600,000 . (b) Aggregate future consideration consists of (i) three equal annual installment payments totaling $1,000,000 , commencing 12 months following the closing, less a reduction of $66,435 due to a customary closing date working capital adjustment (“guaranteed purchase price”), and (ii) contingent performance payments up to an aggregate of $2,500,000 over the three 12-month periods following the closing. These payments are also subject to a downward adjustment up to 30% if Brianna DeMike, ZenContent’s co-founder, is terminated by IZEA for cause or if she terminates her employment without good reason. As a result, the Company initially reduced its acquisition cost liability by $300,000 to be accrued as compensation expense over the three-year term rather than allocated to the initial purchase price in accordance with ASC 805-10-55-25. Compensation expense added to the guaranteed acquisition costs payable and recorded as general and administrative expense in the Company's consolidated statement of operations was $162,500 and $102,431 for the twelve months ended December 31, 2017 and 2016 , respectively. The initial guaranteed purchase price consideration was discounted to present value using the Company's borrowing rate of prime plus 2% ( 5.5% on July 31, 2016). Interest expense imputed on the guaranteed acquisition costs payable in the accompanying consolidated statement of operations was $28,463 and $13,370 for the twelve months ended December 31, 2017 and 2016 . (c) The contingent performance payments are subject to ZenContent achieving certain minimum revenue thresholds over 36 months . ZenContent is required to meet minimum revenues of $2.5 million , $3.5 million and $4.5 million in the first, second and third, respective 12-month periods following the closing in order to receive any portion of the contingent performance payments. Of these payments, 33% of each such annual installment or contingent performance payment will be in the form of cash and the remainder of such payment will be in the form of either cash or additional shares of IZEA common stock at then average stock prices (determined at IZEA’s option). Additionally, these payments are subject to downward adjustment of up to 30% if Brianna DeMike is terminated by IZEA for cause or she terminates her employment without good reason. The Company initially determined the fair value of the $2,500,000 contingent payments to be $230,000 . The fair value of the contingent performance payments is required to be revalued each quarter and is calculated using a Monte-Carlo simulation to simulate revenue over the future periods. Since the contingent consideration has an option like structure, a risk-neutral framework is considered appropriate for the valuation. The Company started with a risk-adjusted measure of forecasted revenue (using a risk-adjusted discount rate of 17% ) and assumed it will follow geometric brownian motion to simulate the revenue at future dates. Once the initial revenue was estimated based off of projections, payout was calculated for each year and present valued to incorporate the credit risk associated with these payments. The Company's fair value conclusion was based on the average payment from 250,000 simulation trials. The volatility used for the simulation was 45% . The interest rate used for the simulation was the Company's current borrowing rate of prime plus 2% ( 6.5% ). The Company revalued its estimate of the contingent performance payment as of December 31, 2017 based on actual results and projections and the rates noted above and determined that current fair value of the contingent performance payments was $744,510 compared to $324,000 as of December 31, 2016 . The change in the estimated fair value of contingent performance payable resulted in a $420,510 increase to general and administrative expense in the Company's consolidated statement of operations during the twelve months ended December 31, 2017 . Of this amount, $185,945 was allocated to compensation expense and a gain of $234,565 was allocated as a change in the fair value of the contingent performance payments. The Company recorded a $94,000 increase in the fair value of the contingent performance payments during the twelve months ended December 31, 2016 for the change from the initial value of $230,000 to $324,000 as of December 31, 2016 . Purchase Price Allocation The consolidated financial statements reflect the allocation of the purchase price to the underlying ZenContent tangible and intangible assets acquired and liabilities assumed based on their respective fair market values with any excess purchase price allocated to goodwill. The allocation of the purchase price as of July 31, 2016 is summarized as follows: Final Purchase Price Allocation Current assets $ 415,798 Property and equipment 4,551 Identifiable intangible assets 722,000 Goodwill 1,136,431 Current liabilities (482,233 ) Total estimated consideration $ 1,796,547 The ZenContent operations are included in the consolidated financial statements beginning on the date of acquisition of July 31, 2016. Upon the acquisition, the majority of the acquired assets were transferred to, and employees were hired by, IZEA. The legal entity of ZenContent was dissolved in December 2017. There are $52,665 of pre-acquisition-related costs included in general and administrative expense on the Company's consolidated statement of operations for the twelve months ended December 31, 2016 . Post closing acquisition costs related to changes in the acquisition costs payable, including interest, compensation expense and earnout estimate changes, are disclosed in notes (b) and (c) above. |
Property and Equipment (Notes)
Property and Equipment (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment Disclosure [Text Block] | PROPERTY AND EQUIPMENT Property and equipment consists of the following: December 31, 2017 December 31, 2016 December 31, 2015 Furniture and fixtures $ 254,099 $ 254,206 $ 252,516 Office equipment 74,627 65,463 53,265 Computer equipment 415,928 432,321 421,798 Leasehold improvements 331,418 324,716 314,400 Total 1,076,072 1,076,706 1,041,979 Less accumulated depreciation and amortization (790,029 ) (616,056 ) (445,971 ) Property and equipment, net $ 286,043 $ 460,650 $ 596,008 Computer equipment includes items under capital leases totaling $59,458 as of December 31, 2015 . Accumulated amortization relating to equipment under capital leases totaled $37,341 as of December 31, 2015 . Depreciation expense on property and equipment recorded in depreciation and amortization expense in the accompanying consolidated statements of operations was $211,769 , $253,004 , and $206,670 for the twelve months ended December 31, 2017 , 2016 , and 2015 , respectively. |
Intangible Assets (Notes)
Intangible Assets (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets Disclosure [Text Block] | INTANGIBLE ASSETS The identifiable intangible assets consists of the following assets: Balance Accumulated Amortization Balance Accumulated Amortization Balance Accumulated Amortization Useful Life (in years) December 31, 2017 December 31, 2016 December 31, 2015 Content provider networks $ 160,000 $ 122,083 $ 160,000 $ 57,083 $ 30,000 $ 27,500 1 Trade names 52,000 52,000 52,000 45,000 40,000 36,667 1 Developed technology 530,000 240,167 530,000 134,167 300,000 55,000 3 Self-service content customers 210,000 204,167 210,000 134,167 210,000 64,167 5 Managed content customers 2,140,000 1,905,555 2,140,000 1,192,222 1,790,000 546,944 3 Domains 166,469 66,588 166,469 33,294 166,469 — 5 Total identifiable intangible assets $ 3,258,469 $ 2,590,560 $ 3,258,469 $ 1,595,933 $ 2,536,469 $ 730,278 Total identifiable intangible assets from the Ebyline and ZenContent purchase price allocation and other acquired assets net of accumulated amortization thereon consists of the following: December 31, December 31, December 31, Ebyline Intangible Assets $ 2,370,000 $ 2,370,000 $ 2,370,000 ZenContent Intangible Assets 722,000 722,000 — Domains 166,469 166,469 166,469 Total Intangible Assets 3,258,469 3,258,469 2,536,469 Accumulated amortization (2,590,560 ) (1,595,933 ) (730,278 ) Intangible Assets, net $ 667,909 $ 1,662,536 $ 1,806,191 The Company is amortizing the identifiable intangible assets over a weighted average period of three years . Amortization expense recorded in depreciation and amortization expense in the accompanying consolidated statements of operations was $994,627 , $865,655 , and $730,278 for the twelve months ended December 31, 2017 , 2016 , and 2015 , respectively. The portion of this amortization expense specifically related to the costs of acquired technology for its platforms that is presented separately from cost of services was $106,000 , $79,167 , and $55,000 for the twelve months ended December 31, 2017 , 2016 , and 2015 , respectively. As of December 31, 2017 , future estimated amortization expense related to identifiable intangible assets over the next five years is set forth in the following schedule: Year ending December 31: Amortization Expense 2018 $ 349,433 2019 207,349 2020 84,293 2021 26,834 Total $ 667,909 |
Software Development Costs (Not
Software Development Costs (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Research and Development [Abstract] | |
Research, Development, and Computer Software Disclosure [Text Block] | SOFTWARE DEVELOPMENT COSTS Software development costs consists of the following: December 31, December 31, December 31, Software development costs $ 1,561,351 $ 1,492,665 $ 1,021,446 Less accumulated depreciation and amortization (593,424 ) (388,706 ) (207,514 ) Software development costs, net $ 967,927 $ 1,103,959 $ 813,932 The Company developed its web-based advertising and content exchange platform, IZEAx, to enable native advertising campaigns on a greater scale. The Company continues to add new features and additional functionality to IZEAx to facilitate the contracting, workflow, and delivery of direct content as well as provide for invoicing, collaborating, and direct payments for the Company's self-service customers. Research and planning phase costs are expensed as incurred. Costs incurred in the application and infrastructure development stage, including significant enhancements and upgrades, are capitalized. These costs include personnel and related employee benefits expenses for employees or consultants who are directly associated with and who devote time to software projects, and external direct costs of materials obtained in developing the software. As a result, the Company has capitalized $1,561,351 in direct materials, consulting, payroll and benefit costs to its internal use software development costs in the consolidated balance sheet as of December 31, 2017 . The Company amortizes its software development costs, upon initial release of the software or additional features, on a straight-line basis over the estimated the useful life of five years , which is consistent with the amount of time its legacy platforms were in service. Amortization expense on software development costs that is presented separately from cost of services and recorded in depreciation and amortization expense in the accompanying consolidated statements of operations was $310,411 , $181,192 and $122,183 for the twelve months ended December 31, 2017 , 2016 , and 2015 , respectively. As of December 31, 2017 , future estimated amortization expense related to software development costs over the next five years is set forth in the following schedule: Year ending December 31: Software Amortization Expense 2018 $ 294,487 2019 226,939 2020 193,611 2021 152,216 2022 82,891 Thereafter 17,783 $ 967,927 |
Derivative Financial (Notes)
Derivative Financial (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives and Fair Value [Text Block] | DERIVATIVE FINANCIAL INSTRUMENTS The Company evaluates its warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with paragraph 810-10-05-4 and 815-40-25 of the FASB Accounting Standards Codification. The result of this accounting treatment is that the fair value of the derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the consolidated statement of operations as other income or expense. Upon registration of the shares underlying the warrants, changes in price-based anti-dilution adjustments, conversion or exercise, as applicable, of a derivative instrument, the instrument is marked to fair value at the date of the occurrence of the event and then that fair value is reclassified to equity. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. Instruments that are initially classified as equity that become subject to reclassification are reclassified to a liability at the fair value of the instrument on the reclassification date. Derivative instrument liabilities will be classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the derivative instrument is expected within 12 months after the balance sheet date. As further described in Note 9, the Company has engaged in a series of private placements between 2011 and 2014 which resulted in the issuance of warrants. The Company determined that some of these warrants required classification as a liability due to certain provisions in their terms. From July 20, 2015 through August 14, 2015, the Company offered a 26% discount on the warrant exercise prices to investors holding warrants from its February 2014 Private Placement (the "2014 Warrants"). If and to the extent a holder did not exercise its 2014 Warrants at the reduced exercise prices during this time period, the exercise prices of any unexercised 2014 Warrants remained at their original exercise prices of $7.00 and $10.00 per share for the series A and series B 2014 Warrants, respectively. In exchange for the reduction in the warrant exercise price, the investors holding a majority of the 2014 Warrants agreed to amend the 2014 Warrants to remove the price-based anti-dilution adjustment provisions contained in the 2014 Warrants. The removal of these provisions from the 2014 Warrants eliminated the provision that required liability classification of the 2014 Warrants and quarterly non-cash adjustments reflecting changes in the fair value of the derivative liability on the Company’s financial statements. Except for the temporarily reduced exercise prices and elimination of the anti-dilution adjustment provisions in the 2014 Warrants, the terms of the 2014 Warrants remain unchanged. As a result of the amendment in the 2014 Warrants terms, the 2014 Warrants no longer require liability classification after August 14, 2015. At the close of the offer period on August 14, 2015, investors exchanged and converted 1,392,832 shares underlying the 2014 Warrants at the 26% discount for total proceeds of $8,760,805 . The amendment of the 2014 Warrants to reduce the exercise price required the Company to treat the adjustment as an exchange whereby it computed the fair value of the 2014 Warrants immediately prior to the price reduction and the fair value of the 2014 Warrants after the price reduction. The $1,197,821 change in the fair value of the 2014 Warrants as a result of the price reduction was treated as a loss on exchange and recorded in the Company's consolidated statements of operations during the twelve months ended December 31, 2015 . As a result of the above transactions, the fair value of $5,348,408 on the 1,392,832 exercised 2014 Warrants and the fair value of $1,181,638 on the 396,536 remaining unexercised 2014 Warrants as of August 14, 2015 was moved to equity as of August 14, 2015. The Company had 5,502 warrant shares issued in its September 2012 public offering that required classification as a liability due to certain registration rights and listing requirements in the agreements. These warrants expired in September 2017 with no value. The following table summarizes the Company's activity and fair value calculations of its derivative warrants for the twelve months ended December 31, 2017 , 2016 , and 2015 : Linked Common Shares to Derivative Warrants Warrant Liability Balance, December 31, 2014 1,795,564 $ 3,203,465 Exercise of warrants for common stock (1,392,832 ) $ (5,348,408 ) Loss on exchange of warrants — $ 1,197,821 Reclassification of fair value of 2014 Private Placement warrants to equity (396,536 ) $ (1,181,638 ) Change in fair value of derivatives — $ 2,133,820 Balance, December 31, 2015 6,196 $ 5,060 Expiration of warrants (694 ) — Change in fair value of derivatives — (5,060 ) Balance, December 31, 2016 5,502 $ — Expiration of warrants (5,502 ) — Balance, December 31, 2017 — $ — During the twelve months ended December 31, 2016 and 2015 , the Company recorded a gain of $5,060 and a loss of $2,133,820 , respectively, due to the change in the fair value of its warrant liability. The Company's warrants were valued on the applicable dates using a Binomial Lattice Option Valuation Technique (“Binomial”). Significant inputs into this technique as of December 31, 2016 were as follows: Binomial Assumptions December 31, December 31, Fair market value of asset (1) $4.51 $7.66 Exercise price $25.00 $25.00 Term (2) 0.7 years 1.7 years Implied expected life (3) 0.7 years 1.7 years Volatility range of inputs (4) 55.91% 83.00% Equivalent volatility (3) 55.91% 83.00% Risk-free interest rate range of inputs (5) 0.85% 1.06% Equivalent risk-free interest rate (3) 0.85% 1.06% (1) The fair market value of the asset was determined by using the Company's closing stock price as reflected on the OTCQB for the period ended December 31, 2015 and on the Nasdaq Capital Market for the period ended December 31, 2016 . (2) The term is the contractual remaining term, allocated among twelve equal intervals for purposes of calculating other inputs, such as volatility and risk-free rate. (3) The implied expected life, and equivalent volatility and risk-free interest rate amounts are derived from the Binomial. (4) The Company does not have a market trading history upon which to base its forward-looking volatility. Accordingly, the Company selected peer companies that provided a reasonable basis upon which to calculate volatility for each of the intervals described in (2), above. (5) The risk-free rates used for inputs represent the yields on zero coupon U.S. Government Securities with periods to maturity consistent with the intervals described in (2), above. |
Commitments and Contingencies (
Commitments and Contingencies (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | COMMITMENTS & CONTINGENCIES Credit Agreement The Company has a secured credit facility agreement with Western Alliance Bank, the parent company of Bridge Bank, N.A. of San Jose, California, which it obtained on March 1, 2013 and expanded on April 13, 2015. Pursuant to this agreement, the Company may submit requests for funding up to 80% of its eligible accounts receivable up to a maximum credit limit of $5 million . This agreement is secured by the Company's accounts receivable and substantially all of the Company's other assets. The agreement renews annually and requires the Company to pay an annual facility fee of $20,000 ( 0.4% of the credit limit) and an annual due diligence fee of $1,000 . Interest accrues on the advances at the rate of prime plus 2% per annum . The default rate of interest is prime plus 7% . As of December 31, 2017 , the Company had $500,550 outstanding under this line of credit agreement. The Company had no advances outstanding under this agreement as of December 31, 2016 . As of December 31, 2017 , the Company had a net accounts receivable balance of $3,647,025 . Assuming that all of the Company's accounts receivable balance was eligible for funding, it had $2,457,180 in remaining available credit under the agreement as of December 31, 2017 . The annual fees are capitalized in the Company's consolidated balance sheet within other current assets and are amortized to interest expense over one year . The Company amortized $21,000 , $19,796 and $18,388 of the annual costs through interest expense during the twelve months ended December 31, 2017 , 2016 , and 2015 , respectively. The remaining value of the capitalized loan costs related to the Bridge Bank credit agreement as of December 31, 2017 is $7,000 . This amount will be amortized to interest expense over the next four months . Lease Commitments Capital Leases During 2013 and 2014, the Company entered into capital leases for equipment which expired on various dates between December 2015 and January 2016. The Company has no obligations under capital leases as of December 31, 2017 and 2016 . Operating Leases The corporate headquarters are located at 480 N. Orlando Avenue, Suite 200 in Winter Park, Florida. The Company occupies this office pursuant to a sixty-five month sublease agreement that expires in April 2019, but is renewable for one additional year until April 30, 2020 . This lease covers approximately 15,500 square feet based on an annually increasing rate of $17.50 to $22.50 per square foot over the lease term. The Company also occupies flexible office space under monthly membership contracts in Los Angeles, San Francisco, Chicago and Toronto. A summary of future minimum lease payments under the Company's non-cancelable leases as of December 31, 2017 is as follows: Year ending December 31: Operating Leases 2018 $ 436,017 2019 113,516 Total minimum lease payments $ 549,533 Total rent expense recorded in general and administrative expense in the accompanying consolidated statements of operations was approximately $579,346 , $618,940 , and $491,543 for the twelve months ended December 31, 2017 , 2016 , and 2015 , respectively. Retirement Plans In December 2007, the Company introduced a 401(k) plan that covered all eligible employees. The Company matches participant contributions in an amount equal to 50% of each participant's contribution up to 8% of the participant's salary. The participants become vested in 20% annual increments after two years of service. During the twelve months ended December 31, 2017 , 2016 , and 2015 , the Company incurred $201,003 , $166,271 , and $125,262 , respectively, in expense for matching employer contributions. Litigation From time to time, the Company may become involved in various lawsuits and legal proceedings that arise in the ordinary course of the Company's business. Litigation is, however, subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm the Company's business. See Note 13 for a recent update on litigation proceedings. The Company is currently not aware of any other legal proceedings or claims that it believes would or could have, individually or in the aggregate, a material adverse effect on its operations or financial position. |
Stockholders' Equity (Notes)
Stockholders' Equity (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | STOCKHOLDERS' EQUITY Authorized Shares The Company has 200,000,000 authorized shares of common stock and 10,000,000 authorized shares of preferred stock, each with a par value of $0.0001 per share. Reverse Stock Split On January 6, 2016, the Company filed a Certificate of Amendment with the Secretary of State of Nevada to effect a reverse stock split of the issued and outstanding shares of its common stock at a ratio of one share for every 20 shares outstanding prior to the effective date of the reverse stock split. All current and historical information contained herein related to the share and per share information for the Company's common stock or stock equivalents reflects the 1-for-20 reverse stock split of the Company's outstanding shares of common stock that became market effective on January 11, 2016. There was no change in the number of the Company's authorized shares of common stock. Nasdaq Uplisting On January 26, 2016, the Company's shares of common stock commenced trading on the Nasdaq Capital Market under the symbol IZEA. Prior thereto, the Company's common stock was quoted on the OTCQB Marketplace under the same symbol. Stock Issued for Acquisitions As further discussed in Note 3, the Company issued 31,821 shares of its common stock to satisfy the $250,000 guaranteed purchase price payment obligation on July 30, 2015 per the Ebyline Stock Purchase Agreement. On January 29, 2016, the Company issued 114,398 shares of its common stock to satisfy the $848,832 annual guaranteed payment of $938,532 less $89,700 in closing related expenses owed as part of the Ebyline Stock Purchase Agreement and on January 30, 2017, the Company issued 200,542 shares of common stock to satisfy the final annual guaranteed payment of $938,532 . On July 31, 2016, the Company issued 86,207 shares of IZEA common stock valued at $600,000 as a partial payment of the guaranteed purchase price per the ZenContent Stock Purchase Agreement. Stock Issued for Services On April 30, 2015 and on December 29, 2015, the Company issued 1,250 and 1,364 shares, respectively, of common stock valued at $18,700 for employee stock awards during the twelve months ended December 31, 2015 . The Company issued 13,767 shares of common stock valued at $107,292 to five directors for their service as directors of the Company during the twelve months ended December 31, 2015 . On August 15, 2015, the Company issued 84,375 shares of common stock to Brian W. Brady for shares granted to him in 2013 as consideration for loans made to the Company. The Company issued each of its five independent directors 811 shares of restricted common stock valued at $6,250 for their service as directors of the Company during the first quarter of 2016. On May 16, 2016, the Company issued each of its five independent directors 3,261 shares of restricted common stock valued at $18,750 for their service as directors of the Company for the period of April 2016 through December 2016. The stock vested in equal increments of approximately 362 shares per month. Total shares issued during the twelve months ended December 31, 2016 were 20,360 at a total initial value of $125,000 . On April 11, 2016, the Company issued 749 shares of restricted common stock valued at $4,794 to four employees as a contest award. The Company issued its five independent directors a total of 41,770 shares of restricted common stock initially valued at $125,000 for their service as directors of the Company during the twelve months ended December 31, 2017 . The stock vested monthly from January through December 2017. On February 12, 2017, the Company issued 7,109 shares valued at $30,000 as compensation for services a contractor provided. The Company issued 2,812 shares and 7,543 shares of restricted stock on August 14, 2017 and November 9, 2017, respectively, to Mr. Edward Murphy, its Chief Executive Officer, for amounts owed on his second and third quarter performance bonus. The stock was initially valued at $36,411 and vests in equal monthly installments over 48 months from issuance. The Company issued 662 shares and 1,257 shares of restricted stock on August 14, 2017 and November 9, 2017, respectively, to Mr. Ryan Schram, its Chief Operating Officer, for amounts owed on his second and third quarter performance bonus. The stock was initially valued at $6,446 and vests in equal monthly installments over 48 months from issuance. The following table contains summarized information about nonvested restricted stock outstanding during the twelve months ended December 31, 2017 and 2016 : Restricted Stock Common Shares Weighted Average Weighted Average Nonvested at December 31, 2014 — $ — Granted 16,381 $ 7.60 Vested (16,381 ) $ 7.60 Forfeited — $ — Nonvested at December 31, 2015 — $ — Granted 21,109 6.15 Vested (21,109 ) 6.34 Forfeited — — Nonvested at December 31, 2016 — $ — Granted 61,153 3.24 Vested (49,354 ) 3.72 Forfeited — — Nonvested at December 31, 2017 11,799 $ 4.52 3.8 Total expense recognized for stock-based payments for services to non-employees during the twelve months ended December 31, 2017 , 2016 , and 2015 was $181,995 , $133,897 , and $125,992 , respectively. The fair value of the services is based on the value of the Company's common stock over the term of service. The Company recognized a gain of $39,269 and $4,103 , and as a change in the fair value of derivatives during the twelve months ended December 31, 2017 and 2016 , respectively, based on the change between the Company's stock price upon issuance and the Company's stock price upon the date of vesting. The fair value of the remaining nonvested, but issued, 11,799 shares of restricted stock as of December 31, 2017 is $53,331 , and it is included in prepaid expenses in the accompanying consolidated balance sheets. This value is the current estimate of future compensation expense that is expected to be recognized over the remaining individual vesting periods up to 47 months. Warrant Transactions Warrant Issuances: On January 22, 2015, the Company issued a warrant to purchase 5,000 shares of common stock to an investor relations consultant. The warrant was fully vested on the date of issuance, has an exercise price of $10.20 per share and expires on January 22, 2020 . The fair value of the warrant upon issuance was $7,700 and the Company received $100 as compensation for the warrant. The fair value of the warrant issuance was recorded as an increase in additional paid-in capital in the Company's consolidated balance sheet and the net $7,600 compensation expense was recorded in general and administrative expense during the twelve months ended December 31, 2015 . On June 30, 2015, the Company issued a warrant to purchase 12,500 shares of common stock to an investor relations consultant. The warrant was fully vested on the date of issuance, has an exercise price of $10.20 per share and expires on June 30, 2020 . The fair value of the warrant upon issuance was $44,250 . The fair value of the warrant issuance was recorded as an increase in additional paid-in capital in the Company's consolidated balance sheet and compensation expense in general and administrative expense during the twelve months ended December 31, 2015 . Warrant Exercises: From July 20, 2015 through August 14, 2015, the Company offered a 25% discount on the warrant exercise prices to investors holding the series A and series B warrants to purchase common stock issued in its August-September 2013 private placement (the “2013 Warrants”) and a 26% discount on the warrant exercise prices to investors holding series A and series B warrants to purchase common stock issued in its February 2014 private placement (the “2014 Warrants” and together with the 2013 Warrants, the "Warrants"). If and to the extent a holder did not exercise its Warrants at the reduced exercise prices during this time period, the exercise prices of any unexercised Warrants remain at their original exercise prices of $5.00 and $10.00 per share for the series A and series B 2013 Warrants, respectively, and $7.00 and $10.00 per share for the series A and series B 2014 Warrants, respectively. The warrant exercise offer was made pursuant to the terms of Warrant Amendment and Exercise Agreements, dated July 20, 2015, entered into with holders owning more than 70% of the Company's outstanding 2013 and 2014 Warrants. In exchange for the reduction in the warrant exercise price, the investors holding a majority of the 2014 Warrants agreed to amend the 2014 Warrants to remove the price-based anti-dilution adjustment provisions contained in the 2014 Warrants. The removal of these provisions from the 2014 Warrants eliminated the provision that required liability classification of the 2014 Warrants and quarterly non-cash adjustments reflecting changes in the fair value of the derivative liability on the Company’s financial statements. Except for the temporarily reduced exercise prices and elimination of the anti-dilution adjustment provisions in the 2014 Warrants, the terms of the 2013 Warrants and 2014 Warrants remain unchanged. As a result of the amendment in the 2014 Warrants terms, the 2014 Warrants no longer require liability classification after August 14, 2015 (See Note 7). At the close of the offer period on August 14, 2015, investors exchanged and converted 1,392,832 shares underlying the 2014 Warrants at the 26% discount for total proceeds of $8,760,805 and 798,715 shares of the 2013 Warrants at the 25% discount for total proceeds of $4,100,252 . This resulted in the issuance of a total of 2,191,547 shares of common stock at an average exercise price of $5.87 per share for total proceeds of $12,861,057 . The exercise prices of any Warrants not exercised during the Warrant conversion offer period have reverted back to their original exercise prices. The amendment of the Warrants to reduce the exercise price required the Company to treat the adjustment as an exchange whereby it computed the fair value of the Warrants immediately prior to the price reduction and the fair value of the Warrants after the price reduction. The $1,197,821 and the $647,989 change in the fair value of the 2014 and 2013 Warrants, respectively, as a result of the price reduction, was treated as a $1,845,810 loss on exchange and recorded in the Company's consolidated statement of operations during the twelve months ended December 31, 2015 . As a result of the above transactions, the fair value of $5,348,408 on the 1,392,832 exercised 2014 Warrants and the fair value of $1,181,638 on the 396,536 remaining unexercised 2014 Warrants as of August 14, 2015 was moved to equity as of August 14, 2015. This reclassification plus the $647,989 loss on exchange of the 2013 Warrants already classified as equity reflects a $7,178,035 total change recorded in the Company's consolidated statement of stockholders' equity during the twelve months ended December 31, 2015 . The resale of the common stock underlying the 2013 and 2014 Warrants is covered by IZEA’s Registration Statements on Form S-1 (Registration Nos. 333-191743, 333-195081 and 333-197482), which are on file with the SEC. Stock Options In May 2011, the Company's Board of Directors (the “Board”) adopted the 2011 Equity Incentive Plan of IZEA, Inc. (the “May 2011 Plan”). At the Company's 2017 Annual Meeting of Stockholders held on June 21, 2017, the stockholders approved the amendment and restatement of the May 2011 Plan which increased the number of shares of common stock available for issuance under the May 2011 Plan by 500,000 shares. The amended May 2011 Plan allows the Company to grant options to purchase up to 1,500,000 shares as an incentive for its employees and consultants. As of December 31, 2017 , the Company had 382,523 shares of common stock available for future grants under the May 2011 Plan. On August 22, 2011, the Company adopted the 2011 B Equity Incentive Plan (the “August 2011 Plan”) reserving 4,375 shares of common stock for issuance under the August 2011 Plan. As of December 31, 2017 , the Company had 1,875 shares of common stock available for future grants under the August 2011 Plan. Under both the May 2011 Plan and the August 2011 Plan (together, the “2011 Equity Incentive Plans”), the Board determines the exercise price to be paid for the shares, the period within which each option may be exercised, and the terms and conditions of each option. The exercise price of the incentive and non-qualified stock options may not be less than 100% of the fair market value per share of the Company’s common stock on the grant date. If an individual owns stock representing more than 10% of the outstanding shares, the price of each share of an incentive stock option must be equal to or exceed 110% of fair market value. Unless otherwise determined by the Board at the time of grant, the purchase price is set at the fair market value of the Company’s common stock on the grant date, the term is set at ten years and the options typically vest on a straight-line basis over the requisite service period as follows: 25% of options shall vest one year from the date of grant and the remaining options shall vest monthly, in equal increments over the following three years . The Company issues new shares to the optionee for any stock awards or options exercised pursuant to its 2011 Equity Incentive Plans. A summary of option activity under the 2011 Equity Incentive Plans for the twelve months ended December 31, 2017 , 2016 , and 2015 is presented below: Options Outstanding Common Shares Weighted Average Exercise Price Weighted Average Remaining Life (Years) Outstanding at December 31, 2014 595,786 $ 9.20 6.5 Granted 277,059 $ 7.43 Exercised — $ — Forfeited (42,246 ) $ 7.70 Outstanding at December 31, 2015 830,599 $ 8.65 6.8 Granted 179,998 6.16 Exercised — — Forfeited (50,733 ) 10.15 Outstanding at December 31, 2016 959,864 $ 8.11 6.4 Granted 141,246 3.49 Exercised — — Forfeited (51,607 ) 38.86 Outstanding at December 31, 2017 1,049,503 $ 5.97 6.0 Exercisable at December 31, 2017 726,426 $ 6.24 4.9 During the twelve months ended December 31, 2017 , 2016 , and 2015 , no options were exercised. The fair value of the Company's common stock on December 31, 2017 was $4.52 per share. The intrinsic value on outstanding options as of December 31, 2017 was $159,671 . The intrinsic value on exercisable options as of December 31, 2017 was $20,102 . A summary of the nonvested stock option activity under the 2011 Equity Incentive Plans for the twelve months ended December 31, 2017 , 2016 , and 2015 , is presented below: Nonvested Options Common Shares Weighted Average Grant Date Fair Value Weighted Average Remaining Years to Vest Nonvested at December 31, 2014 372,092 $ 4.00 3.0 Granted 277,059 $ 3.84 Vested (147,759 ) $ 4.32 Forfeited (39,466 ) $ 3.44 Nonvested at December 31, 2015 461,926 $ 3.84 2.8 Granted 179,998 2.88 Vested (187,181 ) 4.00 Forfeited (40,437 ) 3.76 Nonvested at December 31, 2016 414,306 $ 3.60 2.6 Granted 141,246 1.76 Vested (205,469 ) 3.36 Forfeited (27,006 ) 3.12 Nonvested at December 31, 2017 323,077 $ 2.64 2.7 Stock-based compensation cost related to stock options granted under the 2011 Equity Incentive Plans is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the employee’s requisite service period. The Company estimates the fair value of each option award on the date of grant using a Black-Scholes option-pricing model that uses the assumptions stated in Note 1. Total stock-based compensation expense recognized on restricted stock and option awards during the twelve months ended December 31, 2017 , 2016 , and 2015 was $635,427 , $748,092 , and $705,466 , respectively. Stock-based compensation expense was recorded as $13,381 to cost of revenue, $48,708 to sales and marketing, and $573,338 to general and administrative expense in the Company's consolidated statement of operations during the twelve months ended December 31, 2017 . Stock-based compensation expense was recorded as $18,903 to cost of revenue, $70,680 to sales and marketing, and $658,509 to general and administrative expense in the Company's consolidated statement of operations during the twelve months ended December 31, 2016 . Stock-based compensation expense was recorded as $14,534 to cost of revenue, $33,545 to sales and marketing, and $657,387 to general and administrative expense in the Company's consolidated statement of operations during the twelve months ended December 31, 2015 . Future compensation related to nonvested awards as of December 31, 2017 expected to vest of $744,647 is estimated to be recognized over the weighted-average vesting period of approximately two years, six months . Employee Stock Purchase Plan On April 16, 2014, stockholders holding a majority of the Company's outstanding shares of common stock, upon previous recommendation and approval of the Board, adopted the IZEA, Inc. 2014 Employee Stock Purchase Plan (the “ESPP”) and reserved 75,000 shares of the Company's common stock for issuance thereunder. Any employee regularly employed by the Company for 90 days or more on a full-time or part-time basis ( 20 hours or more per week on a regular schedule) is eligible to participate in the ESPP. The ESPP operates in successive six months offering periods commencing at the beginning of each fiscal year half. Each eligible employee who elects to participate may purchase up to 10% of their annual compensation in common stock not to exceed $21,250 annually or 1,000 shares per offering period. The purchase price will be the lower of (i) 85% of the fair market value of a share of common stock on the first trading day of the offering period or (ii) 85% of the fair market value of a share of common stock on the last trading day of the offering period. The ESPP will continue until January 1, 2024, unless otherwise terminated by the Board. Employees paid $26,249 to purchase 16,168 shares of common stock during the twelve months ended December 31, 2017 . Employees paid $58,021 to purchase 11,453 shares of common stock during the twelve months ended December 31, 2016 . Employees paid $76,170 to purchase 13,403 shares of common stock during the twelve months ended December 31, 2015 . As of December 31, 2017 , the Company had 33,594 remaining shares of common stock available for future grants under the ESPP. |
Earnings (Loss) Per Common Shar
Earnings (Loss) Per Common Share (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | EARNINGS (LOSS) PER COMMON SHARE Basic earnings (loss) per common share is computed by dividing the net income or loss by the basic weighted-average number of shares of common stock outstanding during each period presented. Diluted earnings per share is computed by dividing the net income or loss by the total of the basic weighted-average number of shares of common stock outstanding plus the additional dilutive securities that could be exercised or converted into common shares during each period presented less the amount of shares that could be repurchased using the proceeds from the exercises. Twelve Months Ended December 31, December 31, December 31, Net loss $ (5,467,699 ) $ (7,560,200 ) $ (11,308,171 ) Weighted average shares outstanding - basic and diluted 5,674,901 5,380,465 3,737,897 Basic and diluted loss per common share $ (0.96 ) $ (1.41 ) $ (3.03 ) The Company excluded the following weighted average items from the above computation of diluted loss per common share, as their effect would be anti-dilutive: Twelve Months Ended December 31, December 31, December 31, Stock options 990,152 889,450 723,834 Warrants 531,969 551,867 1,873,547 Restricted stock units — — 58,475 Total excluded shares 1,522,121 1,441,317 2,655,856 |
Related Party Transactions (Not
Related Party Transactions (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | RELATED PARTY TRANSACTIONS In the warrant exchange transaction completed on August 14, 2015 as discussed in Note 9, the Special Situations Technology Fund II, L.P., Special Situations Private Equity Fund, L.P. and Special Situations Technology Fund, L.P. (collectively, the “Special Situations Funds”), the Company's largest institutional shareholder, and Brian W. Brady, a director of the Company, participated in the transaction by exercising warrants that they received in the Company's previous private placements. The Special Situations Funds made a payment in the amount of $3,414,572 in consideration for 542,858 shares of the Company's common stock, and Mr. Brady made a payment in the amount of $2,460,208 in consideration for 502,940 shares of the Company's common stock. The Special Situations Funds and Mr. Brady exercised their warrants at the same price and on the same terms and conditions as all other warrant holders in the transaction, the negotiation of which terms was led by the Special Situations Funds and other institutional shareholders. Mr. Murphy and Mr. Gardner also participated in the warrant exchange transaction and made payments of $2,741 and $179,715 , respectively, in consideration for 436 and 28,572 , respective shares of the Company's common stock. |
Income Taxes (Notes)
Income Taxes (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | INCOME TAXES On December 22, 2017, the Tax Cuts and Jobs Act (“Tax Act”), was signed into law resulting in significant changes to U.S. tax law, generally effective for tax years beginning after December 31, 2017. Among other changes, the Tax Act reduces the U.S. corporate income tax rate to 21 percent from a maximum rate of 34 percent; implements a new system of taxation for non-U.S. earnings, including imposing a one-time tax on the deemed repatriation of undistributed earnings of non-U.S. subsidiaries, permitting deductions for certain dividends from non-U.S. subsidiaries, and expanding income inclusions from controlled foreign corporations; imposes significant additional limitations on the deductibility of interest; and allows for the expensing of certain capital expenditures. In the absence of guidance on various ambiguities in the application of certain provisions of the Tax Act, the Company used what it believes are reasonable interpretations and assumptions in applying the Tax Act. It is possible, however, that the U.S. Internal Revenue Service will issue subsequent guidance or take positions that differ from the Company's interpretations and assumptions, which could have a material adverse effect on its deferred tax assets and liabilities, results of operations, and financial condition. Because the Company's deferred tax assets and liabilities are fully reserved, there was no impact of the Tax Act on the consolidated financial statements for the twelve months ended December 31, 2017 . However, deferred tax balances and related valuation allowances were re-measured to reflect the future tax benefit at the new enacted corporate tax rate of 21% . The U.S. deferred tax assets were reduced by $6.3 million and the valuation allowance was also reduced by $6.3 million . This re-measurement resulted in no net impact to the effective tax rate for the year ended December 31, 2017. The components of the Company’s net deferred income taxes are as follows (rounded): December 31, December 31, December 31, Deferred tax assets: Net operating loss carry forwards $ 19,362,000 $ 17,875,000 $ 15,649,000 Change in federal tax rate (6,329,000 ) — — Accrued expenses 270,000 256,000 187,000 Stock option and warrant expenses 698,000 804,000 618,000 Accounts receivable 67,000 90,000 52,000 Deferred rent 24,000 36,000 44,000 Other 1,000 3,000 3,000 Total deferred tax assets 14,093,000 19,064,000 16,553,000 Valuation allowance (13,860,000 ) (18,475,000 ) (15,871,000 ) Net deferred tax assets 233,000 589,000 682,000 Deferred tax liabilities: Fixed and tangible assets (233,000 ) (589,000 ) (682,000 ) Total deferred tax liabilities (233,000 ) (589,000 ) (682,000 ) Total deferred tax assets (liabilities) $ — $ — $ — The following summary reconciles differences from taxes at the federal statutory rate with the effective rate: Twelve Months Ended 2017 2016 2015 Federal income tax at statutory rates (34.0 )% (34.0 )% (34.0 )% Change in deferred tax asset valuation allowance (81.7 )% 39.0 % 28.8 % Deferred state taxes (3.3 )% (3.2 )% (2.5 )% Non-deductible expenses: Change in value of acquisition liability 3.7 % — % — % Change in fair value of warrants — % — % 6.4 % ISO stock compensation 1.6 % 1.3 % 0.7 % Change in state & federal deferred rate 112.1 % (4.2 )% — % Other 1.6 % 1.1 % 0.6 % Income taxes (benefit) at effective rates — % — % — % The Company has incurred net losses for tax purposes every year since inception. At December 31, 2017 , the Company had approximately $50,177,102 in net operating loss carryforwards for U.S. federal and state income tax purposes that expire in various amounts between the years of 2026 and 2037 . The Company's ability to deduct its historical net operating losses may be limited in the future due to IRC Section 382 as a result of the substantial issuances of common stock in 2012 through 2015. Certain of the Company's net operating losses acquired in connection with the Ebyline acquisition also may be limited by IRC Section 382. The change in valuation allowance for the twelve months ended December 31, 2017 was a decrease of $4,615,000 resulting from the reduction in the future corporate tax rate offset by net operating losses during the period. The change in valuation allowance for the twelve months ended December 31, 2016 and 2015 was an increase of $2,604,000 and $4,648,000 , respectively, resulting primarily from net operating losses generated during the period. |
Subsequent Events (Notes)
Subsequent Events (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | SUBSEQUENT EVENTS On April 4, 2018, a securities lawsuit, Julian Perez v. IZEA, Inc., et al ., case number 2:18-cv-02784-SVW-GJS was instituted in the U.S. District Court for the Central District of California against the Company and certain of its executive officers on behalf of certain purchasers of the Company's common stock. The plaintiffs seek to recover damages for investors under federal securities laws. The Company believes that the plaintiffs’ allegations are without merit and intends to vigorously defend against the claims. The Company is still in the early stages of this litigation and is unable to estimate a reasonably possible range of loss, if any, that may result from this matter. On April 5, 2018, IZEA, Inc. (the “Company”) received a notification letter from the Listing Qualifications Department of Nasdaq indicating that, as a result of the Company’s delay in filing this Annual Report, the Company is not in compliance with the timely filing requirements for continued listing under Nasdaq Listing Rule 5250(c)(1). The notification letter has no immediate effect on the listing or trading of the Company’s common stock on the Nasdaq Capital Market. The Company filed a Notification of Late Filing on Form 12b-25 on April 3, 2018, indicating that the filing of this Annual Report would be delayed until after the completion of a restatement of the Company’s previously issued financial statements included in its Annual Reports on Form 10-K for the years ended December 31, 2015 and 2016 and Quarterly Reports on Form 10-Q for each quarter for the years ended December 31, 2015 and 2016, and the first three quarters for the year ended December 31, 2017. The notification letter stated that, under Nasdaq rules, the Company has 60 calendar days, or until June 4, 2018, to submit a plan to regain compliance with Nasdaq’s continued listing requirements. The Company may also regain compliance with Nasdaq’s continued listing requirements at any time before June 4, 2018, by filing this Annual Report with the SEC, as well as any subsequent periodic financial reports that may become due, and continuing to comply with Nasdaq’s other continued listing requirements. The filing of this Annual Report is the Company's action to regain compliance. |
Unaudited Quarterly Financial D
Unaudited Quarterly Financial Data (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information [Text Block] | UNAUDITED QUARTERLY FINANCIAL DATA The information for each quarterly period for the years ended December 31, 2015 and 2016, and for the first three quarters for the year ended December 31, 2017 have been restated to correct the errors and changes in presentation described in Note 2. The restated quarterly consolidated statements of operations for these quarterly periods are presented below: Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 8,154,674 $ (1,064,819 ) $ — $ — $ 7,089,855 Costs and expenses: Cost of revenue (exclusive of amortization) 3,758,621 (1,064,819 ) 608,824 — 3,302,626 Sales and marketing 2,342,002 — (608,824 ) — 1,733,178 General and administrative 2,687,266 — — (374,965 ) 2,312,301 Depreciation and amortization — — — 374,965 374,965 Total costs and expenses 8,787,889 (1,064,819 ) — — 7,723,070 Loss from operations (633,215 ) — — — (633,215 ) Other income (expense): Interest expense (15,058 ) (15,058 ) Change in fair value of derivatives, net 45,160 45,160 Other income (expense), net 44,308 44,308 Total other income (expense), net 74,410 — — — 74,410 Net loss $ (558,805 ) $ — $ — $ — $ (558,805 ) Weighted average common shares outstanding – basic and diluted 5,702,297 5,702,297 Basic and diluted loss per common share $ (0.10 ) $ (0.10 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 6,980,221 $ (1,267,317 ) $ — $ — $ 5,712,904 Costs and expenses: Cost of revenue (exclusive of amortization) 3,442,181 (1,267,317 ) 539,835 2,714,699 Sales and marketing 2,426,363 — (539,835 ) — 1,886,528 General and administrative 2,524,630 — — (358,260 ) 2,166,370 Depreciation and amortization — — — 358,260 358,260 Total costs and expenses 8,393,174 (1,267,317 ) — — 7,125,857 Loss from operations (1,412,953 ) — — — (1,412,953 ) Other income (expense): Interest expense (13,272 ) (13,272 ) Change in fair value of derivatives, net (8,420 ) (8,420 ) Other income (expense), net (11,953 ) (11,953 ) Total other income (expense), net (33,645 ) — — — (33,645 ) Net loss $ (1,446,598 ) $ — $ — $ — $ (1,446,598 ) Weighted average common shares outstanding – basic and diluted 5,676,629 5,676,629 Basic and diluted loss per common share $ (0.25 ) $ (0.25 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 6,202,506 $ (1,368,001 ) $ — $ — $ 4,834,505 Costs and expenses: Cost of revenue (exclusive of amortization) 3,195,526 (1,368,001 ) 509,535 2,337,060 Sales and marketing 2,898,355 — (509,535 ) — 2,388,820 General and administrative 2,809,524 — — (362,606 ) 2,446,918 Depreciation and amortization — — 362,606 362,606 Total costs and expenses 8,903,405 (1,368,001 ) — — 7,535,404 Loss from operations (2,700,899 ) — — — (2,700,899 ) Other income (expense): Interest expense (17,076 ) (17,076 ) Change in fair value of derivatives, net (618 ) (618 ) Other income (expense), net (627 ) (627 ) Total other income (expense), net (18,321 ) — — — (18,321 ) Net loss $ (2,719,220 ) $ — $ — $ — $ (2,719,220 ) Weighted average common shares outstanding – basic and diluted 5,598,200 5,598,200 Basic and diluted loss per common share $ (0.49 ) $ (0.49 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 7,433,991 $ (1,550,377 ) $ — $ — $ 5,883,614 Costs and expenses: Cost of revenue (exclusive of amortization) 3,795,209 (1,550,377 ) 643,460 2,888,292 Sales and marketing 2,705,246 — (643,460 ) — 2,061,786 General and administrative 2,723,490 — — (364,788 ) 2,358,702 Depreciation and amortization — — 364,788 364,788 Total costs and expenses 9,223,945 (1,550,377 ) — — 7,673,568 Loss from operations (1,789,954 ) — — — (1,789,954 ) Other income (expense): Interest expense (24,683 ) (24,683 ) Change in fair value of derivatives, net (5,405 ) (5,405 ) Other income (expense), net (9,590 ) (9,590 ) Total other income (expense), net (39,678 ) — — — (39,678 ) Net loss $ (1,829,632 ) $ — $ — $ — $ (1,829,632 ) Weighted average common shares outstanding – basic and diluted 5,450,005 5,450,005 Basic and diluted loss per common share $ (0.34 ) $ (0.34 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 7,496,972 $ (1,463,042 ) $ — $ — $ 6,033,930 Costs and expenses: Cost of revenue (exclusive of amortization) 3,927,279 (1,463,042 ) 595,877 3,060,114 Sales and marketing 2,584,287 — (595,877 ) — 1,988,410 General and administrative 2,454,555 — — (339,589 ) 2,114,966 Depreciation and amortization — — 339,589 339,589 Total costs and expenses 8,966,121 (1,463,042 ) — — 7,503,079 Loss from operations (1,469,149 ) — — — (1,469,149 ) Other income (expense): Interest expense (25,511 ) (25,511 ) Change in fair value of derivatives, net (14,705 ) (14,705 ) Other income (expense), net (2,238 ) (2,238 ) Total other income (expense), net (42,454 ) — — — (42,454 ) Net loss $ (1,511,603 ) $ — $ — $ — $ (1,511,603 ) Weighted average common shares outstanding – basic and diluted 5,420,020 5,420,020 Basic and diluted loss per common share $ (0.28 ) $ (0.28 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 6,913,689 $ (1,480,064 ) $ — $ — $ 5,433,625 Costs and expenses: Cost of revenue (exclusive of amortization) 3,418,387 (1,480,064 ) 586,546 2,524,869 Sales and marketing 2,612,714 — (571,696 ) — 2,041,018 General and administrative 2,524,746 — (14,850 ) (299,177 ) 2,210,719 Depreciation and amortization — — 299,177 299,177 Total costs and expenses 8,555,847 (1,480,064 ) — — 7,075,783 Loss from operations (1,642,158 ) — — — (1,642,158 ) Other income (expense): Interest expense (11,411 ) (11,411 ) Change in fair value of derivatives, net 26,421 26,421 Other income (expense), net 803 803 Total other income (expense), net 15,813 — — — 15,813 Net loss $ (1,626,345 ) $ — $ — $ — $ (1,626,345 ) Weighted average common shares outstanding – basic and diluted 5,350,128 5,350,128 Basic and diluted loss per common share $ (0.30 ) $ (0.30 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 5,465,950 $ (1,582,822 ) $ — $ 3,883,128 Costs and expenses: Cost of revenue (exclusive of amortization) 3,101,369 (1,582,822 ) 482,947 2,001,494 Sales and marketing 2,359,663 — (461,287 ) — 1,898,376 General and administrative 2,580,001 — (21,660 ) (296,297 ) 2,262,044 Depreciation and amortization — 296,297 296,297 Total costs and expenses 8,041,033 (1,582,822 ) — — 6,458,211 Loss from operations (2,575,083 ) — — — (2,575,083 ) Other income (expense): Interest expense (21,339 ) (21,339 ) Change in fair value of derivatives, net 2,852 2,852 Other income (expense), net 950 950 Total other income (expense), net (17,537 ) — — — (17,537 ) Net loss $ (2,592,620 ) $ — $ — $ — $ (2,592,620 ) Weighted average common shares outstanding – basic and diluted 5,300,520 5,300,520 Basic and diluted loss per common share $ (0.49 ) $ (0.49 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 6,262,233 $ (1,734,392 ) $ — $ — $ 4,527,841 Costs and expenses: Cost of revenue (exclusive of amortization) 3,587,608 (1,734,392 ) 489,381 2,342,597 Sales and marketing 2,626,091 — (468,981 ) — 2,157,110 General and administrative 2,435,748 — (20,400 ) (428,071 ) 1,987,277 Depreciation and amortization — — 428,071 428,071 Total costs and expenses 8,649,447 (1,734,392 ) — — 6,915,055 Loss from operations (2,387,214 ) — — — (2,387,214 ) Other income (expense): Interest expense (29,507 ) (29,507 ) Loss on exchange of warrants — — Change in fair value of derivatives, net 5,720 5,720 Other income (expense), net 4,120 4,120 Total other income (expense), net (19,667 ) — — — (19,667 ) Net loss $ (2,406,881 ) $ — $ — $ — $ (2,406,881 ) Weighted average common shares outstanding – basic and diluted 5,118,139 5,118,139 Basic and diluted loss per common share $ (0.47 ) $ (0.47 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 5,442,457 $ (1,722,518 ) $ — $ — $ 3,719,939 Costs and expenses: Cost of revenue (exclusive of amortization) 3,290,457 (1,722,518 ) 475,392 2,043,331 Sales and marketing 1,982,088 — (452,792 ) — 1,529,296 General and administrative 1,056,473 — (22,600 ) (230,553 ) 803,320 Depreciation and amortization — — 230,553 230,553 Total costs and expenses 6,329,018 (1,722,518 ) — — 4,606,500 Loss from operations (886,561 ) — — — (886,561 ) Other income (expense): Interest expense (31,191 ) (31,191 ) Loss on exchange of warrants (1,845,810 ) (1,845,810 ) Change in fair value of derivatives, net 115,904 115,904 Other income (expense), net 2,571 2,571 Total other income (expense), net (1,758,526 ) — — — (1,758,526 ) Net loss $ (2,645,087 ) $ — $ — $ — $ (2,645,087 ) Weighted average common shares outstanding – basic and diluted 4,075,605 4,075,605 Basic and diluted loss per common share $ (0.65 ) $ (0.65 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 4,627,742 $ (1,750,026 ) $ — $ — $ 2,877,716 Costs and expenses: Cost of revenue (exclusive of amortization) 2,917,360 (1,750,026 ) 414,398 1,581,732 Sales and marketing 1,746,549 — (397,398 ) — 1,349,151 General and administrative 2,164,380 — (17,000 ) (226,211 ) 1,921,169 Depreciation and amortization — — 226,211 226,211 Total costs and expenses 6,828,289 (1,750,026 ) — — 5,078,263 Loss from operations (2,200,547 ) — — — (2,200,547 ) Other income (expense): Interest expense (36,393 ) (36,393 ) Loss on exchange of warrants — — Change in fair value of derivatives, net 250,507 250,507 Other income (expense), net 1,142 1,142 Total other income (expense), net 215,256 — — — 215,256 Net loss $ (1,985,291 ) $ — $ — $ — $ (1,985,291 ) Weighted average common shares outstanding – basic and diluted 2,885,721 2,885,721 Basic and diluted loss per common share $ (0.69 ) $ (0.69 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 4,135,494 $ (1,151,305 ) $ — $ — $ 2,984,189 Costs and expenses: Cost of revenue (exclusive of amortization) 2,441,491 (1,151,305 ) 340,691 1,630,877 Sales and marketing 1,581,487 — (330,691 ) — 1,250,796 General and administrative 1,860,514 — (10,000 ) (174,296 ) 1,676,218 Depreciation and amortization — — 174,296 174,296 Total costs and expenses 5,883,492 (1,151,305 ) — — 4,732,187 Loss from operations (1,747,998 ) — — — (1,747,998 ) Other income (expense): Interest expense (18,770 ) (18,770 ) Loss on exchange of warrants — — Change in fair value of derivatives, net (2,505,951 ) (2,505,951 ) Other income (expense), net 1,807 1,807 Total other income (expense), net (2,522,914 ) — — — (2,522,914 ) Net loss $ (4,270,912 ) $ — $ — $ — $ (4,270,912 ) Weighted average common shares outstanding – basic and diluted 2,884,883 2,884,883 Basic and diluted loss per common share $ (1.48 ) $ (1.48 ) |
Company and Summary of Signif21
Company and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation The consolidated financial statements include the accounts of IZEA, Inc. and its wholly-owned subsidiaries, Ebyline after its acquisition on January 27, 2015, ZenContent, Inc. after its acquisition on July 31, 2016 until its closure in December 2017, and IZEA Canada, Inc. after its formation in March 2016. All significant intercompany balances and transactions have been eliminated in consolidation. The consolidated financial statements were prepared using the acquisition method of accounting with IZEA considered the accounting acquirer of Ebyline and ZenContent. Under the acquisition method of accounting, the purchase price is allocated to the underlying tangible and intangible assets acquired and liabilities assumed based on their respective fair market values with any excess purchase price allocated to goodwill. |
Restatement [Policy Text Block] | Restatement In connection with the year-end financial statement close process, the process of evaluating the adoption of the new accounting pronouncement for revenue recognition, and preparation of this Annual Report, the Company determined that its previously issued financial statements included in its Annual Reports on Form 10-K for the years ended December 31, 2015 and 2016 and Quarterly Reports on Form 10-Q for each quarterly period for the years ended December 31, 2015 and 2016, and for the first three quarters for the year ended December 31, 2017 (collectively, the “Restated Periods”) should be restated due to classification errors related to the Company's presentation of revenue related to the self-service Content Workflow portion of its revenue and the Company's classification of certain costs within the consolidated statement of operations related to Managed Services. See Notes 2 and 14 for further information and quantitative information on the Restated Periods. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with a maturity of three months or less from the date of purchase to be cash equivalents. |
Receivables, Policy [Policy Text Block] | Accounts Receivable and Concentration of Credit Risk Accounts receivable are customer obligations due under normal trade terms. Uncollectibility of accounts receivable is not significant since most customers are bound by contract and are required to fund the Company for all the costs of an “opportunity,” defined as an order created by a marketer for a creator to develop or share content on behalf of a marketer. If a portion of the account balance is deemed uncollectible, the Company will either write-off the amount owed or provide a reserve based on the uncollectible portion of the account. Management determines the collectibility of accounts by regularly evaluating individual customer receivables and considering a customer’s financial condition, credit history and current economic conditions. The Company had a reserve of $189,000 , $237,000 , and $139,000 for doubtful accounts as of December 31, 2017 , 2016 , and 2015 , respectively. Management believes that this estimate is reasonable, but there can be no assurance that the estimate will not change as a result of a change in economic conditions or business conditions within the industry, the individual customers or the Company. Any adjustments to this account are reflected in the consolidated statements of operations as a general and administrative expense. Bad debt expense was less than 1% of revenue for the twelve months ended December 31, 2017 , 2016 , and 2015 . |
Concentration Risk, Credit Risk, Policy [Policy Text Block] | Concentrations of credit risk with respect to accounts receivable are typically limited because a large number of geographically diverse customers make up the Company’s customer base, thus spreading the trade credit risk. The Company also controls credit risk through credit approvals, credit limits and monitoring procedures. The Company performs credit evaluations of its customers but generally does not require collateral to support accounts receivable. The Company had no customers that accounted for more than 10% of total accounts receivable at December 31, 2017 and 2016 and one customer that accounted for 13% of total accounts receivable at December 31, 2015 . The Company had no customer that accounted for more than 10% of its revenue during the twelve months ended December 31, 2017 , one customer that accounted for 11% of its revenue during the twelve months ended December 31, 2016 , and one customer that accounted for 12% of its revenue during the twelve months ended December 31, 2015 . |
Property, Plant and Equipment, Policy [Policy Text Block] | Property and Equipment Property and equipment are recorded at cost, or if acquired in a business combination, at the acquisition date fair value. Depreciation and amortization is computed using the straight-line method over the estimated useful lives of the assets as follows: Computer Equipment 3 years Software Costs 3 - 5 years Office Equipment 3 - 10 years Furniture and Fixtures 5 - 10 years Leasehold improvements are amortized over the shorter of the term of the lease or the estimated useful lives of the improvements. Property and equipment under capital leases are depreciated over their estimated useful lives. Expenditures for repairs and maintenance are charged to expense as incurred. Expenditures for betterments and major improvements are capitalized and depreciated over the remaining useful lives of the assets. The carrying amounts of assets sold or retired and the related accumulated depreciation are eliminated in the year of disposal, with resulting gains or losses included in general and administrative expense. |
Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block] | Goodwill Goodwill represents the excess of the purchase consideration of an acquired business over the fair value of the underlying net tangible and intangible assets. The Company has goodwill in connection with its acquisition of Ebyline and ZenContent. Goodwill is not amortized, but instead it is tested for impairment at least annually. In the event that management determines that the value of goodwill has become impaired, the Company will record a charge for the amount of impairment during the fiscal quarter in which the determination is made. The Company performs its annual impairment tests of goodwill during the fourth quarter of each year, or more frequently, if certain indicators are present. Goodwill is required to be tested for impairment at the reporting unit level. A reporting unit is an operating segment or one level below the operating segment level, which is referred to as a component. Management identifies its reporting units by assessing whether components (i) have discrete financial information available; (ii) engage in business activities; and (iii) whether a segment manager regularly reviews the component's operating results. Net assets and goodwill of acquired businesses are allocated to the reporting unit associated with the acquired business based on the anticipated organizational structure of the combined entities. If two or more components are deemed economically similar, those components are aggregated into one reporting unit when performing the annual goodwill impairment review. The Company has determined that prior to and after the acquisition of Ebyline and ZenContent, it had, and continues to have, one reporting unit. |
Intangible Assets, Finite-Lived, Policy [Policy Text Block] | Intangible Assets The Company acquired the majority of its intangible assets through its acquisition of Ebyline on January 30, 2015 and its acquisition of ZenContent on July 31, 2016. The Company is amortizing the identifiable intangible assets over a period of 12 to 60 months. See Note 5 for further details. Management reviews long-lived assets, including property and equipment, software development costs and other intangible assets, for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. If an evaluation is required, the estimated future undiscounted cash flows associated with the asset are compared with the asset's carrying amount to determine if there has been an impairment, which is calculated as the difference between the fair value of an asset and its carrying value. Estimates of future undiscounted cash flows are based on expected growth rates for the business, anticipated future economic conditions and estimates of residual values. Fair values take into consideration management estimates of risk-adjusted discount rates, which are believed to be consistent with assumptions that marketplace participants would use in their estimates of fair value. For the twelve months ended December 31, 2017 , 2016 , and 2015 , there were no impairment charges associated with the Company's long-lived assets. |
Software Development Costs, Policy [Policy Text Block] | Software Development Costs In accordance with ASC 350-40, Internal Use Software, the Company capitalizes certain internal use software development costs associated with creating and enhancing internally developed software related to its platforms. Software development activities generally consist of three stages (i) the research and planning stage, (ii) the application and development stage, and (iii) the post-implementation stage. Costs incurred in the planning and post-implementation stages of software development, or other maintenance and development expenses that do not meet the qualification for capitalization are expensed as incurred. Costs incurred in the application and infrastructure development stage, including significant enhancements and upgrades, are capitalized. These costs include personnel and related employee benefits expenses for employees or consultants who are directly associated with and who devote time to software projects, and external direct costs of materials obtained in developing the software. These software development and acquired technology costs are amortized on a straight-line basis over the estimated useful life of five years upon initial release of the software or additional features. See Note 6 for further details. |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition The Company derives revenue from managing content services or advertising campaigns for its customers, as well as from making its platforms available to allow customers the ability to purchase content directly from its creators. In January 2017, the Company revised the way it categorizes its revenue streams to more closely align the revenue based on margin profiles and how it currently analyzes the business. The revised categories are as follows: Managed Services, Content Workflow, and Service Fee Revenue. Managed Services is when a marketer (typically a brand, agency or partner) contracts IZEA to provide custom content, influencer marketing or amplification services. Content Workflow is derived from the self-service use of the Company's platforms by marketers to handle their content workflow, from initial content request to payment of content received or distributed. Service Fee Revenue is generated from various service and license fees charged to users of the Company's platforms. The Company recognizes revenue when four basic criteria are met: (i) persuasive evidence of an arrangement exists; (ii) services have been rendered or delivery has occurred; (iii) the fees are fixed or determinable; and (iv) collectibility is reasonably assured. The Company maintains separate arrangements with each marketer and content creator either in the form of a master agreement or terms of service, which specifies the terms of the relationship and access to its platforms, or by statement of work, which specifies the price and the services to be performed, along with other terms. The Company recognizes revenue as the service is being performed, upon delivery of the content or promotion, or upon the completion of a transaction, as detailed further below. The Company assesses whether fees are fixed or determinable based on the contractual terms of the arrangements or when the ordered services are delivered. The Company assesses collectibility based on a number of factors, including the creditworthiness of the customer and payment and transaction history. Revenue is reported depending on whether the Company functions as principal or agent in the transaction. The determination of whether the Company acts as the principal or the agent is highly subjective and requires the Company to evaluate a number of indicators individually and as a whole in order to make its determination. For transactions in which the Company is the principal, revenue is reported on a gross basis for the amount paid by the marketer for the purchase of content or sponsorship, promotion and other related services. The Company records the amounts it pays to its third-party creators as cost of revenue. For transactions in which the Company is the agent, revenue is reported on a net basis for the amount the Company charged to the self-service marketer using the platform, less the amounts the Company paid to its third-party creators providing the service. Based on the Company's evaluations, revenue from Managed Services and Service Fees are reported on a gross basis and revenue from Content Workflow is reported on a net basis. For Managed Services, the Company enters into an agreement to provide services that may require multiple deliverables in the form of: (i) sponsored social items, such as blogs, tweets, photos or videos shared through social network offerings that provide awareness or advertising buzz regarding the marketer's brand; (ii) content promotion, such as click-through advertisements appearing in websites and social media channels; and (iii) original content items, such as a research or news article, informational material or videos that a publisher or other marketer can use. The Company may provide one type or a combination of all types of these deliverables including a management fee on a statement of work for a lump sum fee. These deliverables are to be provided over a stated period that may range from one day to one year. Each item is considered delivered once the custom content has been delivered to the customer or once the content is distributed live through a public or social network. Revenue is accounted for separately on each of the deliverables depending on the type of service provided. The Company recognizes revenue related to influencer marketing services after a marketer's sponsored content is posted through IZEAx and shared through a creator's social network. Management fees from customer campaigns managed by the Company are recognized ratably over the term of the campaign, which may range from a few days to one year. Revenue related to custom content provided to a marketer is recognized when the content is delivered to and accepted by the customer. Payment terms are typically 30 days from the invoice date. If the Company is unable to provide a portion of the services, it may agree with the customer to provide a different type of service or to provide a credit for the value of those services, which may be applied to the existing order or used for future services. The agreement typically provides for a cancellation fee if the agreement is canceled by the customer prior to completion of services. Marketers who use the Company to manage their advertising campaigns or custom content requests may prepay for services or request credit terms. Payments received or billings in advance of completed services are recorded as unearned revenue until earned as described above. For Content Workflow services, the self-service marketer contracts the creators directly to provide or distribute custom content. The Company's platforms control the contracting, description of services, acceptance of and payment for the requested content. This service is used primarily by news agencies or marketers to control the outsourcing of their content and advertising needs. Revenue is recognized when the transaction is completed by the creator and accepted by the marketer. Service Fee Revenue is generated when fees are charged to customers primarily related to subscription fees for different levels of service within a platform, licensing fees for the use of the IZEAx or Ebyline platforms, inactivity fees and early cash-out fees. Fees for subscription or licensing services are recognized straight-line over the term of service, while other fees are recognized at a point in time when the account is deemed inactive or a cash-out below certain minimum thresholds is requested. Effective January 1, 2018, the Company became subject to new guidelines for disclosing and accounting for its revenue from contracts with customers. See further details below under “Recent Accounting Pronouncements.” |
Advertising Cost, Policy, Expensed Advertising Cost [Policy Text Block] | Advertising Costs Advertising costs are charged to expense as they are incurred, including payments to content creators to promote the Company. Advertising costs charged to operations for the twelve months ended December 31, 2017 , 2016 , and 2015 were approximately $324,000 , $455,000 and $558,000 , respectively. Advertising costs are included in sales and marketing expense in the accompanying consolidated statements of operations. |
Deferred Charges, Policy [Policy Text Block] | Deferred Rent The Company’s operating leases for its office facilities contain rent abatements and predetermined fixed increases of the base rental rate during the lease terms. The Company accounts for rental expense on a straight-line basis over the lease terms. The Company records the difference between the straight-line expense and the actual amounts paid under the lease as deferred rent in the accompanying consolidated balance sheets. |
Income Tax, Policy [Policy Text Block] | Income Taxes The Company has not recorded federal income tax expense due to the generation of net operating losses. Deferred income taxes are accounted for using the balance sheet approach, which requires recognition of deferred tax assets and liabilities for the expected future consequences of temporary differences between the financial reporting basis and the tax basis of assets and liabilities. A valuation allowance is provided when it is more likely than not that a deferred tax asset will not be realized. The Company incurs minimal state franchise tax in four states, which is included in general and administrative expense in the consolidated statements of operations. The Company identifies and evaluates uncertain tax positions, if any, and recognizes the impact of uncertain tax positions for which there is a less than more-likely-than-not probability of the position being upheld when reviewed by the relevant taxing authority. Such positions are deemed to be unrecognized tax benefits and a corresponding liability is established on the balance sheet. The Company has not recognized a liability for uncertain tax positions. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses. The Company’s tax years subject to examination by the Internal Revenue Service are 2013, 2014 and 2015. |
Derivatives, Policy [Policy Text Block] | Derivative Financial Instruments Derivative financial instruments are defined as financial instruments or other contracts that contain a notional amount and one or more underlying factors (e.g., interest rate, security price or other variable), require no initial net investment and permit net settlement. Derivative financial instruments may be free-standing or embedded in other financial instruments. Further, derivative financial instruments are initially, and subsequently, measured at fair value and recorded as liabilities or assets. The Company accounts for derivative instruments in accordance with ASC 815, Derivatives and Hedging (“ASC 815”), which requires additional disclosures about the Company’s objectives and strategies for using derivative instruments, how the derivative instruments and related hedged items are accounted for, and how the derivative instruments and related hedging items affect the financial statements. The Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risk. Terms of equity instruments are reviewed to determine whether or not they contain embedded derivative instruments that are required under ASC 815 to be accounted for separately from the host contract, and recorded on the balance sheet at fair value. The fair value of derivative liabilities, if any, is required to be revalued at each reporting date, with corresponding changes in fair value recorded in current period operating results. Pursuant to ASC 815, an evaluation of specifically identified conditions is made to determine whether the fair value of warrants issued is required to be classified as equity or as a derivative liability. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments The Company’s financial instruments are recorded at fair value. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The valuation techniques are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect certain market assumptions. There are three levels of inputs that may be used to measure fair value: • Level 1 – Valuation based on quoted market prices in active markets for identical assets and liabilities. • Level 2 – Valuation based on quoted market prices for similar assets and liabilities in active markets. • Level 3 – Valuation based on unobservable inputs that are supported by little or no market activity, therefore requiring management’s best estimate of what market participants would use as fair value. Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management. The Company does not have any Level 1 or 2 financial assets or liabilities. The Company’s Level 3 financial liabilities measured at fair value consisted of its acquisition cost liability (see Note 3) as of December 31, 2017 , 2016 , and 2015 , and a warrant liability as of December 31, 2016 and 2015 . Significant unobservable inputs used in the fair value measurement of the warrants include the estimated term and risk-adjusted interest rates. In developing its credit risk assumption used in the fair value of warrants, the Company considered publicly available bond rates and US Treasury Yields. However, since the Company does not have a formal credit-standing, management estimated its standing among various reported levels and grades for use in the model. During all periods, management estimated that the Company's standing was in the speculative to high-risk grades (BB- to CCC in the Standard and Poor's Rating). Significant increases or decreases in the estimated remaining period to exercise or the risk-adjusted interest rate could result in a significantly lower or higher fair value measurement. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include cash and cash equivalents, accounts receivable, accounts payable, unearned revenue, and accrued expenses. Unless otherwise disclosed, the fair value of the Company’s notes payable obligations approximate their carrying value based upon current rates available to the Company. |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | Stock-Based Compensation Stock-based compensation cost related to stock options granted under the 2011 Equity Incentive Plan and 2011 B Equity Incentive Plan (together, the “2011 Equity Incentive Plans”) (see Note 9) is measured at the grant date, based on the fair value of the award, and is recognized as a straight-lined expense over the employee’s requisite service period. The Company estimates the fair value of each option award on the date of grant using a Black-Scholes option-pricing model that uses the assumptions noted in the table below. The Company estimates the fair value of its common stock using the closing stock price of its common stock on the date of the grant. The Company estimates the volatility of its common stock at the date of grant based on the volatility of comparable peer companies that are publicly traded and have had a longer trading history than itself. The Company determines the expected life based on historical experience with similar awards, giving consideration to the contractual terms, vesting schedules and post-vesting forfeitures. The Company uses the risk-free interest rate on the implied yield currently available on U.S. Treasury issues with an equivalent remaining term approximately equal to the expected life of the award. The Company has never paid any cash dividends on its common stock and does not anticipate paying any cash dividends in the foreseeable future. The Company used the following assumptions for options granted under the 2011 Equity Incentive Plans during the twelve months ended December 31, 2017 , 2016 , and 2015 : Twelve Months Ended 2011 Equity Incentive Plans Assumptions December 31, December 31, December 31, Expected term 6 years 6 years 6 years Weighted average volatility 50.16% 47.95% 55.47% Weighted average risk free interest rate 2.06% 1.58% 1.65% Expected dividends — — — Effective January 1, 2017, the Company considered its accounting for stock options pursuant to ASU No. 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . This ASU is intended to reduce the cost and complexity of accounting for employee share-based payment transactions primarily surrounding the accounting for income taxes upon vesting or exercise of share-based payments and accounting for forfeitures, as well as related financial statement classifications. Although the new standard allows for the non-use of forfeiture estimates, the Company elected to continue the use of estimated forfeitures when accounting for stock-based compensation, because it has an established history of forfeitures for non-vested options. There was no effect on the Company's financial statements as a result of the adoption of this standard. The Company estimates forfeitures when recognizing compensation expense and this estimate of forfeitures is adjusted over the requisite service period based on the extent to which actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures are recognized through a cumulative catch-up adjustment, which is recognized in the period of change, and a revised amount of unamortized compensation expense to be recognized in future periods. Average expected forfeiture rates were 8.58% , 9.52% , and 8.32% during the twelve months ended December 31, 2017 , 2016 , and 2015 , respectively. |
Non-Employee Stock-Based Compensation [Policy Text Block] | Non-Employee Stock-Based Payments The Company's accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of ASC 505, “Equity-Based Payments to Non-Employees.” The measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor's performance is complete. The fair value of equity instruments issued to consultants that vest immediately is expensed when issued. The fair value of equity instruments issued to consultants that have future vesting and are subject to forfeiture if performance does not occur is recognized as expense over the vesting period. Fair values for the unvested portion of issued instruments are adjusted each reporting period. The change in fair value is recorded in the accompanying consolidated statements of operations. Stock-based payments related to non-employees is accounted for based on the fair value of the related stock or the fair value of the services, whichever is more readily determinable. |
Segment Reporting, Policy [Policy Text Block] | Segment Information The Company does not identify separate operating segments for management reporting purposes. The results of consolidated operations are the basis on which management evaluates operations and makes business decisions. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Reclassification, Policy [Policy Text Block] | Reclassifications Certain items have been reclassified in the 2016 financial statements to conform to the 2017 presentation. The Company has reclassified wages and other expenses related to its campaign fulfillment personnel out of sales and marketing expense and into cost of revenue (see Notes 2 and 12 for additional details). Additionally, the Company has reclassified its depreciation and amortization expenses out of general and administrative expense and into a separately stated line item labeled depreciation and amortization within the accompanying consolidated statements of operations. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) and has subsequently issued additional guidance materials under ASU No. 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net), ASU No. 2016-10, Identifying Performance Obligations and Licensing, and ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients (collectively “ASC 606”), which supersedes nearly all existing revenue recognition guidance under GAAP. Under ASC 606, revenue will be recognized based on a five-step model and, in doing so, more judgment and estimates may be required within the revenue recognition process than are required under existing GAAP. The Company has reviewed its sources of revenue in accordance with each of the five steps in the model, which are as follows: (i) identify the contract with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) performance obligations are satisfied. The core principle of ASC 606 is that revenue will be recognized when the transfer of promised goods or services to customers is made in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Subsequent updates have been issued primarily to provide implementation guidance related to the initial guidance issued in May 2014. ASC 606 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017, and may be adopted using either (i) a full retrospective method, whereby comparative periods would be restated to present the impact of the new standard, with the cumulative effect of applying the standard recognized as of the earliest period presented, or (ii) a modified retrospective method, under which comparative periods would not be restated and the cumulative effect of applying the standard would be recognized at the date of initial adoption, January 1, 2018. The Company continues to evaluate the impact of ASC 606 using internal resources and a third-party service provider. As part of its evaluation, the Company is assessing the impact of the new principal versus agent guidance, focusing on whether or not it controls the good or service before transferring it to customers. The Company is also assessing the impact of capitalizing and amortizing incremental costs associated with obtaining and fulfilling customer contracts, specifically set-up costs and commission and incentive payments. The Company is further assessing impact on the Company's future financial disclosures of qualitative and quantitative information concerning the nature, amount, timing, and assumptions used in its determinations of revenue and expected cash flows from contracts with customers. The Company is planning to adopt ASC 606 using the modified retrospective method. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) . This ASU increases transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The new standard establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. Since the issuance of the original standard, the FASB has issued a subsequent update, ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842 , which provides a practical expedient for land easements. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently evaluating the impact that this ASU will have on its consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which adds or clarifies guidance on the presentation and classification of eight specific types of cash receipts and cash payments in the statement of cash flows such as debt prepayment or debt extinguishment costs, settlement of contingent consideration arising from a business combination, insurance settlement proceeds, and distributions received from certain equity method investees, with the intent of reducing the existing diversity in practice. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Entities must apply the guidance retrospectively to all periods presented unless retrospective application is impracticable. The Company is adopting this standard in the first quarter of fiscal 2018 and is currently evaluating the impact that this ASU will have on its consolidated financial statements. I n October 2016, the FASB issued ASU No. 2016-16 , Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory (“ASU 2016-16”), which eliminates the current prohibition on immediate recognition of the current and deferred income tax effects of intra-entity transfers of assets other than inventory, with the intent of reducing complexity and diversity in practice. Under ASU 2016-16, entities must recognize the income tax consequences when the transfer occurs rather than deferring recognition. For public entities, ASU 2016-16 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Entities must apply the guidance on a modified retrospective basis though a cumulative effect adjustment to retained earnings as of the beginning of the period of adoption. The Company is adopting this standard in the first quarter of fiscal year 2018 and does not believe there will be any current impact on the consolidated financial statements upon adopting this standard given there are no current intra-entity transfer of assets. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (“ASU 2016-18”). ASU 2016-18 addresses diversity in practice that exists in the classification and presentation of changes in restricted cash within the statement of cash flows and requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. ASU 2016-18 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. The Company is adopting this standard in the first quarter of fiscal year 2018 and is currently evaluating the impact that adopting this standard will have on its consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business (“ASU 2017-01”) . This ASU clarifies the definition of a business and provides guidance on evaluating as to whether transactions should be accounted for as acquisitions (or disposals) of assets or business combinations. The definition clarification as outlined in ASU 2017-01 affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. The amendments of ASU 2017-01 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. The Company is adopting this standard in the first quarter of fiscal year 2018 and would apply this standard for business combinations consummated subsequent to January 1, 2018. In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”) . To address concerns over the cost and complexity of the two-step goodwill impairment test, the new standard removes the requirement for the second step of the goodwill impairment test for certain entities. An entity may apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit's carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The new standard is effective for fiscal years beginning after December 15, 2019. The Company is currently evaluating the impact that ASU 2017-04 will have on its consolidated financial statements. In May 2017, the FASB issued ASU No. 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting (“ASU 2017-09”) . The amendments in ASU 2017-09 provide guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. ASU 2017-09 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. The amendments in this update will be applied on a prospective basis to an award modified on or after the adoption date. The Company is adopting this standard in the first quarter of fiscal year 2018 and does not expect that the adoption of this new standard will have an impact on its consolidated financial statements unless it modifies an award in the future, of which there is no current plan. In July 2017, the FASB issued ASU No. 2017-11, Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features; (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception (“ASU 2017-11”). Part I of this update addresses the complexity of accounting for certain financial instruments with down round features. Down round features are features of certain equity-linked instruments (or embedded features) that result in the strike price being reduced on the basis of the pricing of future equity offerings. Current accounting guidance creates cost and complexity for entities that issue financial instruments (such as warrants and convertible instruments) with down round features that require fair value measurement of the entire instrument or conversion option. Part II of this update addresses the difficulty of navigating Topic 480 because of the existence of extensive pending content in the FASB Accounting Standards Codification. This pending content is the result of the indefinite deferral of accounting requirements about mandatorily redeemable financial instruments of certain nonpublic entities and certain mandatorily redeemable noncontrolling interests. The amendments in Part II of this update do not have an accounting effect. ASU 2017-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. The Company is currently in the early stages of evaluating the impact that adopting this standard will have on its consolidated financial statements. In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities (“ASU 2017-12”). The amendments in this ASU better align the risk management activities and financial reporting for these hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and presentation of hedge results. ASU 2017-12 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. The Company is currently in the early stages of evaluating the impact that adopting this standard will have on its consolidated financial statements. |
Company and Summary of Signif22
Company and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Schedule Of Estimated Useful Lives Of Property Plant And Equipment [Table Text Block] | Property and equipment are recorded at cost, or if acquired in a business combination, at the acquisition date fair value. Depreciation and amortization is computed using the straight-line method over the estimated useful lives of the assets as follows: Computer Equipment 3 years Software Costs 3 - 5 years Office Equipment 3 - 10 years Furniture and Fixtures 5 - 10 years |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block] | The Company used the following assumptions for options granted under the 2011 Equity Incentive Plans during the twelve months ended December 31, 2017 , 2016 , and 2015 : Twelve Months Ended 2011 Equity Incentive Plans Assumptions December 31, December 31, December 31, Expected term 6 years 6 years 6 years Weighted average volatility 50.16% 47.95% 55.47% Weighted average risk free interest rate 2.06% 1.58% 1.65% Expected dividends — — — |
Restatement (Tables)
Restatement (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of Error Corrections and Prior Period Adjustments [Table Text Block] | The impact of the restatement on the Company's consolidated statement of operations as of December 31, 2016 and 2015 (based on the Company's current consolidated statement of operations presentation) is as follows: Twelve Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 27,310,602 $ (6,076,305 ) $ — $ 21,234,297 Costs and expenses: Cost of revenue (exclusive of amortization) 14,242,244 (6,076,305 ) 2,308,830 10,474,769 Sales and marketing 10,261,910 (2,272,320 ) 7,989,590 General and administrative 10,282,792 (36,510 ) (1,299,851 ) 8,946,431 Depreciation and amortization — 1,299,851 1,299,851 Total costs and expenses 34,786,946 (6,076,305 ) — — 28,710,641 Loss from operations (7,476,344 ) — — — (7,476,344 ) Other income (expense): Interest expense (82,944 ) (82,944 ) Change in fair value of derivatives, net 9,163 9,163 Other income (expense), net (10,075 ) (10,075 ) Total other income (expense), net (83,856 ) — — — (83,856 ) Net loss $ (7,560,200 ) $ — $ — $ — $ (7,560,200 ) Weighted average common shares outstanding – basic and diluted 5,380,465 5,380,465 Basic and diluted loss per common share $ (1.41 ) $ (1.41 ) Twelve Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 20,467,926 $ (6,358,241 ) $ — $ 14,109,685 Costs and expenses: Cost of revenue (exclusive of amortization) 12,236,916 (6,358,241 ) 1,719,862 7,598,537 Sales and marketing 7,936,215 (1,649,862 ) 6,286,353 General and administrative 7,517,115 (70,000 ) (1,059,131 ) 6,387,984 Depreciation and amortization — 1,059,131 1,059,131 Total costs and expenses 27,690,246 (6,358,241 ) — — 21,332,005 Loss from operations (7,222,320 ) — — — (7,222,320 ) Other income (expense): Interest expense (115,861 ) (115,861 ) Loss on exchange of warrants (1,845,810 ) (1,845,810 ) Change in fair value of derivatives, net (2,133,820 ) (2,133,820 ) Other income (expense), net 9,640 9,640 Total other income (expense), net (4,085,851 ) — — — (4,085,851 ) Net loss $ (11,308,171 ) $ — $ — $ — $ (11,308,171 ) Weighted average common shares outstanding – basic and diluted 3,737,897 3,737,897 Basic and diluted loss per common share $ (3.03 ) $ (3.03 ) |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Ebyline, Inc. [Member] | |
Business Acquisition [Line Items] | |
Schedule of Business Acquisitions Consideration Payable [Table Text Block] | Estimated Gross Purchase Consideration Initial Present and Fair Value Remaining Present and Fair Value Remaining Present and Fair Value Remaining Present and Fair Value 1/30/2015 1/30/2015 12/31/2015 12/31/2016 12/31/2017 Cash paid at closing (a) $ 1,200,000 $ 1,200,000 $ — $ — $ — Guaranteed purchase price (a) 2,127,064 1,982,639 1,823,711 934,728 — Contingent performance payments (b) 2,210,000 1,834,300 — — — Acquisition costs payable by Ebyline shareholders(c) — — (89,700 ) — — Total estimated consideration $ 5,537,064 $ 5,016,939 $ 1,734,011 $ 934,728 $ — Current portion of acquisition costs payable $ 844,931 $ 934,728 $ — Long term portion of acquisition costs payable 889,080 — — Total acquisition costs payable $ 1,734,011 $ 934,728 $ — (a) The Ebyline Stock Purchase Agreement required a $1,200,000 cash payment at closing, a $250,000 stock payment on July 30, 2015 and a cash or stock payment of up to an additional $1,900,000 ( subject to proportional reduction in the event Ebyline’s final 2014 revenue was below $8,000,000 ). Ebyline's final gross revenue for 2014 was $7,903,429 . As such, the additional amount owed became $1,877,064 payable in two equal installments of $938,532 on January 30, 2016 and January 30, 2017. This guaranteed purchase price consideration was discounted to present value using the Company's borrowing rate of prime plus 2% . Interest expense imputed on the acquisition costs payable in the accompanying consolidated statements of operations was $3,804 , $49,549 , and $91,072 for the twelve months ended December 31, 2017 , 2016 , and 2015 , respectively. Per the Ebyline Stock Purchase Agreement, the Company issued 31,821 shares of its common stock to satisfy the $250,000 guaranteed purchase price payment obligation on July 30, 2015. On January 29, 2016, the Company issued 114,398 shares of its common stock to satisfy the $848,832 annual guaranteed payment of $938,532 less $89,700 in closing related expenses (see item (c) below). On January 30, 2017, the Company issued 200,542 shares of common stock to satisfy the final annual guaranteed payment of $938,532 . The Company recorded a $10,491 gain on the settlement of the acquisition costs payable in the accompanying consolidated statements of operations as a result of the difference between the market price of the stock on the settlement date and the 30-day average price of the stock required by the Ebyline Stock Purchase Agreement. (b) Total contingent performance payments up to $5,500,000 are to be paid based on Ebyline meeting certain revenue targets. The performance payments are to be made only if Ebyline achieves at least 90% of Content Revenue targets of $17,000,000 in 2015, $27,000,000 in 2016 and $32,000,000 in 2017. These revenue targets were assumed on a gross transaction basis. The initial fair value of the $5,500,000 of contingent performance payments was calculated using a Monte-Carlo simulation to simulate revenue over three years. Since the contingent consideration has an option like structure, a risk-neutral framework was considered appropriate for the valuation. The Company started with a risk-adjusted measure of forecasted revenue (using a risk-adjusted discount rate of 8.5% ) and assumed it will follow geometric brownian motion to simulate the revenue at future dates. Once the initial revenue was estimated based off of projections made during the acquisition, payout was calculated for each year and present valued to incorporate the credit risk associated with these payments. The Company's initial value conclusion was based on the average payment from 100,000 simulation trials. The volatility used for the simulation was 35% . The Monte Carlo simulation resulted in an initial calculated fair value of contingent performance payments of $2,210,000 on January 30, 2015 . Because the contingent performance payments are subject to a 17% reduction related to the continued employment of certain key employees, ASC 805-10-55-25 indicates that a portion of these payments be treated as potential compensation to be accrued over the term rather than allocated to the purchase price. Therefore, the Company reduced its overall purchase price consideration by $357,700 and recorded the initial present value of the contingent performance payments at $1,834,300 . The Content Revenue from 2015-2017 was below 90% of all of the required Content Revenues targets. Therefore, the Company reduced the fair value of contingent performance payments to zero by the end of 2015. The $1,834,300 decrease in the estimated fair value of contingent performance payments was recorded as a reduction of general and administrative expense in the Company's consolidated statement of operations during the year ended December 31, 2015 . (c) According to the Ebyline Stock Purchase Agreement, $89,700 in closing related expenses paid by Ebyline during the acquisition process were payable by the selling shareholders. These costs were deducted from the guaranteed payment on January 30, 2016. |
ZenContent [Member] | |
Business Acquisition [Line Items] | |
Schedule of Business Acquisitions Consideration Payable [Table Text Block] | Estimated Gross Purchase Consideration Initial Present and Fair Value Remaining Present and Fair Value Remaining Present and Fair Value 7/31/2016 7/31/2016 12/31/2016 12/31/2017 Cash paid at closing (a) $ 400,000 $ 400,000 $ — $ — Stock paid at closing (a) 600,000 600,000 — — Guaranteed purchase price (b) 933,565 566,547 682,348 606,413 Contingent performance payments (c) 2,500,000 230,000 324,000 744,510 Total estimated consideration $ 4,433,565 $ 1,796,547 $ 1,006,348 $ 1,350,923 Current portion of acquisition costs payable $ 318,157 $ 741,155 Long-term portion of acquisition costs payable 688,191 609,768 Total acquisition costs payable $ 1,006,348 $ 1,350,923 (a) The aggregate consideration paid at closing for the acquisition of ZenContent consisted of a cash payment of $400,000 and the issuance of 86,207 shares of IZEA common stock valued at $600,000 . (b) Aggregate future consideration consists of (i) three equal annual installment payments totaling $1,000,000 , commencing 12 months following the closing, less a reduction of $66,435 due to a customary closing date working capital adjustment (“guaranteed purchase price”), and (ii) contingent performance payments up to an aggregate of $2,500,000 over the three 12-month periods following the closing. These payments are also subject to a downward adjustment up to 30% if Brianna DeMike, ZenContent’s co-founder, is terminated by IZEA for cause or if she terminates her employment without good reason. As a result, the Company initially reduced its acquisition cost liability by $300,000 to be accrued as compensation expense over the three-year term rather than allocated to the initial purchase price in accordance with ASC 805-10-55-25. Compensation expense added to the guaranteed acquisition costs payable and recorded as general and administrative expense in the Company's consolidated statement of operations was $162,500 and $102,431 for the twelve months ended December 31, 2017 and 2016 , respectively. The initial guaranteed purchase price consideration was discounted to present value using the Company's borrowing rate of prime plus 2% ( 5.5% on July 31, 2016). Interest expense imputed on the guaranteed acquisition costs payable in the accompanying consolidated statement of operations was $28,463 and $13,370 for the twelve months ended December 31, 2017 and 2016 . (c) The contingent performance payments are subject to ZenContent achieving certain minimum revenue thresholds over 36 months . ZenContent is required to meet minimum revenues of $2.5 million , $3.5 million and $4.5 million in the first, second and third, respective 12-month periods following the closing in order to receive any portion of the contingent performance payments. Of these payments, 33% of each such annual installment or contingent performance payment will be in the form of cash and the remainder of such payment will be in the form of either cash or additional shares of IZEA common stock at then average stock prices (determined at IZEA’s option). Additionally, these payments are subject to downward adjustment of up to 30% if Brianna DeMike is terminated by IZEA for cause or she terminates her employment without good reason. The Company initially determined the fair value of the $2,500,000 contingent payments to be $230,000 . The fair value of the contingent performance payments is required to be revalued each quarter and is calculated using a Monte-Carlo simulation to simulate revenue over the future periods. Since the contingent consideration has an option like structure, a risk-neutral framework is considered appropriate for the valuation. The Company started with a risk-adjusted measure of forecasted revenue (using a risk-adjusted discount rate of 17% ) and assumed it will follow geometric brownian motion to simulate the revenue at future dates. Once the initial revenue was estimated based off of projections, payout was calculated for each year and present valued to incorporate the credit risk associated with these payments. The Company's fair value conclusion was based on the average payment from 250,000 simulation trials. The volatility used for the simulation was 45% . The interest rate used for the simulation was the Company's current borrowing rate of prime plus 2% ( 6.5% ). The Company revalued its estimate of the contingent performance payment as of December 31, 2017 based on actual results and projections and the rates noted above and determined that current fair value of the contingent performance payments was $744,510 compared to $324,000 as of December 31, 2016 . The change in the estimated fair value of contingent performance payable resulted in a $420,510 increase to general and administrative expense in the Company's consolidated statement of operations during the twelve months ended December 31, 2017 . Of this amount, $185,945 was allocated to compensation expense and a gain of $234,565 was allocated as a change in the fair value of the contingent performance payments. The Company recorded a $94,000 increase in the fair value of the contingent performance payments during the twelve months ended December 31, 2016 for the change from the initial value of $230,000 to $324,000 as of December 31, 2016 . |
Schedule of Business Acquisitions, by Acquisition [Table Text Block] | The allocation of the purchase price as of July 31, 2016 is summarized as follows: Final Purchase Price Allocation Current assets $ 415,798 Property and equipment 4,551 Identifiable intangible assets 722,000 Goodwill 1,136,431 Current liabilities (482,233 ) Total estimated consideration $ 1,796,547 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment [Table Text Block] | Property and equipment consists of the following: December 31, 2017 December 31, 2016 December 31, 2015 Furniture and fixtures $ 254,099 $ 254,206 $ 252,516 Office equipment 74,627 65,463 53,265 Computer equipment 415,928 432,321 421,798 Leasehold improvements 331,418 324,716 314,400 Total 1,076,072 1,076,706 1,041,979 Less accumulated depreciation and amortization (790,029 ) (616,056 ) (445,971 ) Property and equipment, net $ 286,043 $ 460,650 $ 596,008 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination [Table Text Block] | The identifiable intangible assets consists of the following assets: Balance Accumulated Amortization Balance Accumulated Amortization Balance Accumulated Amortization Useful Life (in years) December 31, 2017 December 31, 2016 December 31, 2015 Content provider networks $ 160,000 $ 122,083 $ 160,000 $ 57,083 $ 30,000 $ 27,500 1 Trade names 52,000 52,000 52,000 45,000 40,000 36,667 1 Developed technology 530,000 240,167 530,000 134,167 300,000 55,000 3 Self-service content customers 210,000 204,167 210,000 134,167 210,000 64,167 5 Managed content customers 2,140,000 1,905,555 2,140,000 1,192,222 1,790,000 546,944 3 Domains 166,469 66,588 166,469 33,294 166,469 — 5 Total identifiable intangible assets $ 3,258,469 $ 2,590,560 $ 3,258,469 $ 1,595,933 $ 2,536,469 $ 730,278 |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | Total identifiable intangible assets from the Ebyline and ZenContent purchase price allocation and other acquired assets net of accumulated amortization thereon consists of the following: December 31, December 31, December 31, Ebyline Intangible Assets $ 2,370,000 $ 2,370,000 $ 2,370,000 ZenContent Intangible Assets 722,000 722,000 — Domains 166,469 166,469 166,469 Total Intangible Assets 3,258,469 3,258,469 2,536,469 Accumulated amortization (2,590,560 ) (1,595,933 ) (730,278 ) Intangible Assets, net $ 667,909 $ 1,662,536 $ 1,806,191 Software development costs consists of the following: December 31, December 31, December 31, Software development costs $ 1,561,351 $ 1,492,665 $ 1,021,446 Less accumulated depreciation and amortization (593,424 ) (388,706 ) (207,514 ) Software development costs, net $ 967,927 $ 1,103,959 $ 813,932 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | As of December 31, 2017 , future estimated amortization expense related to identifiable intangible assets over the next five years is set forth in the following schedule: Year ending December 31: Amortization Expense 2018 $ 349,433 2019 207,349 2020 84,293 2021 26,834 Total $ 667,909 As of December 31, 2017 , future estimated amortization expense related to software development costs over the next five years is set forth in the following schedule: Year ending December 31: Software Amortization Expense 2018 $ 294,487 2019 226,939 2020 193,611 2021 152,216 2022 82,891 Thereafter 17,783 $ 967,927 |
Software Development Costs (Tab
Software Development Costs (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Research and Development [Abstract] | |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | Total identifiable intangible assets from the Ebyline and ZenContent purchase price allocation and other acquired assets net of accumulated amortization thereon consists of the following: December 31, December 31, December 31, Ebyline Intangible Assets $ 2,370,000 $ 2,370,000 $ 2,370,000 ZenContent Intangible Assets 722,000 722,000 — Domains 166,469 166,469 166,469 Total Intangible Assets 3,258,469 3,258,469 2,536,469 Accumulated amortization (2,590,560 ) (1,595,933 ) (730,278 ) Intangible Assets, net $ 667,909 $ 1,662,536 $ 1,806,191 Software development costs consists of the following: December 31, December 31, December 31, Software development costs $ 1,561,351 $ 1,492,665 $ 1,021,446 Less accumulated depreciation and amortization (593,424 ) (388,706 ) (207,514 ) Software development costs, net $ 967,927 $ 1,103,959 $ 813,932 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | As of December 31, 2017 , future estimated amortization expense related to identifiable intangible assets over the next five years is set forth in the following schedule: Year ending December 31: Amortization Expense 2018 $ 349,433 2019 207,349 2020 84,293 2021 26,834 Total $ 667,909 As of December 31, 2017 , future estimated amortization expense related to software development costs over the next five years is set forth in the following schedule: Year ending December 31: Software Amortization Expense 2018 $ 294,487 2019 226,939 2020 193,611 2021 152,216 2022 82,891 Thereafter 17,783 $ 967,927 |
Derivative Financial (Tables)
Derivative Financial (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block] | The following table summarizes the Company's activity and fair value calculations of its derivative warrants for the twelve months ended December 31, 2017 , 2016 , and 2015 : Linked Common Shares to Derivative Warrants Warrant Liability Balance, December 31, 2014 1,795,564 $ 3,203,465 Exercise of warrants for common stock (1,392,832 ) $ (5,348,408 ) Loss on exchange of warrants — $ 1,197,821 Reclassification of fair value of 2014 Private Placement warrants to equity (396,536 ) $ (1,181,638 ) Change in fair value of derivatives — $ 2,133,820 Balance, December 31, 2015 6,196 $ 5,060 Expiration of warrants (694 ) — Change in fair value of derivatives — (5,060 ) Balance, December 31, 2016 5,502 $ — Expiration of warrants (5,502 ) — Balance, December 31, 2017 — $ — |
Schedule of Price Risk Derivatives [Table Text Block] | The Company's warrants were valued on the applicable dates using a Binomial Lattice Option Valuation Technique (“Binomial”). Significant inputs into this technique as of December 31, 2016 were as follows: Binomial Assumptions December 31, December 31, Fair market value of asset (1) $4.51 $7.66 Exercise price $25.00 $25.00 Term (2) 0.7 years 1.7 years Implied expected life (3) 0.7 years 1.7 years Volatility range of inputs (4) 55.91% 83.00% Equivalent volatility (3) 55.91% 83.00% Risk-free interest rate range of inputs (5) 0.85% 1.06% Equivalent risk-free interest rate (3) 0.85% 1.06% (1) The fair market value of the asset was determined by using the Company's closing stock price as reflected on the OTCQB for the period ended December 31, 2015 and on the Nasdaq Capital Market for the period ended December 31, 2016 . (2) The term is the contractual remaining term, allocated among twelve equal intervals for purposes of calculating other inputs, such as volatility and risk-free rate. (3) The implied expected life, and equivalent volatility and risk-free interest rate amounts are derived from the Binomial. (4) The Company does not have a market trading history upon which to base its forward-looking volatility. Accordingly, the Company selected peer companies that provided a reasonable basis upon which to calculate volatility for each of the intervals described in (2), above. (5) The risk-free rates used for inputs represent the yields on zero coupon U.S. Government Securities with periods to maturity consistent with the intervals described in (2), above. |
Commitments and Contingencies C
Commitments and Contingencies Commitments and Contingencies Disclosure (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | A summary of future minimum lease payments under the Company's non-cancelable leases as of December 31, 2017 is as follows: Year ending December 31: Operating Leases 2018 $ 436,017 2019 113,516 Total minimum lease payments $ 549,533 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Nonvested Restricted Stock Shares Activity [Table Text Block] | The following table contains summarized information about nonvested restricted stock outstanding during the twelve months ended December 31, 2017 and 2016 : Restricted Stock Common Shares Weighted Average Weighted Average Nonvested at December 31, 2014 — $ — Granted 16,381 $ 7.60 Vested (16,381 ) $ 7.60 Forfeited — $ — Nonvested at December 31, 2015 — $ — Granted 21,109 6.15 Vested (21,109 ) 6.34 Forfeited — — Nonvested at December 31, 2016 — $ — Granted 61,153 3.24 Vested (49,354 ) 3.72 Forfeited — — Nonvested at December 31, 2017 11,799 $ 4.52 3.8 |
Share-based Compensation, Stock Options, Activity [Table Text Block] | A summary of option activity under the 2011 Equity Incentive Plans for the twelve months ended December 31, 2017 , 2016 , and 2015 is presented below: Options Outstanding Common Shares Weighted Average Exercise Price Weighted Average Remaining Life (Years) Outstanding at December 31, 2014 595,786 $ 9.20 6.5 Granted 277,059 $ 7.43 Exercised — $ — Forfeited (42,246 ) $ 7.70 Outstanding at December 31, 2015 830,599 $ 8.65 6.8 Granted 179,998 6.16 Exercised — — Forfeited (50,733 ) 10.15 Outstanding at December 31, 2016 959,864 $ 8.11 6.4 Granted 141,246 3.49 Exercised — — Forfeited (51,607 ) 38.86 Outstanding at December 31, 2017 1,049,503 $ 5.97 6.0 Exercisable at December 31, 2017 726,426 $ 6.24 4.9 |
Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of Nonvested Share Activity [Table Text Block] | A summary of the nonvested stock option activity under the 2011 Equity Incentive Plans for the twelve months ended December 31, 2017 , 2016 , and 2015 , is presented below: Nonvested Options Common Shares Weighted Average Grant Date Fair Value Weighted Average Remaining Years to Vest Nonvested at December 31, 2014 372,092 $ 4.00 3.0 Granted 277,059 $ 3.84 Vested (147,759 ) $ 4.32 Forfeited (39,466 ) $ 3.44 Nonvested at December 31, 2015 461,926 $ 3.84 2.8 Granted 179,998 2.88 Vested (187,181 ) 4.00 Forfeited (40,437 ) 3.76 Nonvested at December 31, 2016 414,306 $ 3.60 2.6 Granted 141,246 1.76 Vested (205,469 ) 3.36 Forfeited (27,006 ) 3.12 Nonvested at December 31, 2017 323,077 $ 2.64 2.7 |
Earnings (Loss) Per Common Sh31
Earnings (Loss) Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Basic earnings (loss) per common share is computed by dividing the net income or loss by the basic weighted-average number of shares of common stock outstanding during each period presented. Diluted earnings per share is computed by dividing the net income or loss by the total of the basic weighted-average number of shares of common stock outstanding plus the additional dilutive securities that could be exercised or converted into common shares during each period presented less the amount of shares that could be repurchased using the proceeds from the exercises. Twelve Months Ended December 31, December 31, December 31, Net loss $ (5,467,699 ) $ (7,560,200 ) $ (11,308,171 ) Weighted average shares outstanding - basic and diluted 5,674,901 5,380,465 3,737,897 Basic and diluted loss per common share $ (0.96 ) $ (1.41 ) $ (3.03 ) |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block] | The Company excluded the following weighted average items from the above computation of diluted loss per common share, as their effect would be anti-dilutive: Twelve Months Ended December 31, December 31, December 31, Stock options 990,152 889,450 723,834 Warrants 531,969 551,867 1,873,547 Restricted stock units — — 58,475 Total excluded shares 1,522,121 1,441,317 2,655,856 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | The components of the Company’s net deferred income taxes are as follows (rounded): December 31, December 31, December 31, Deferred tax assets: Net operating loss carry forwards $ 19,362,000 $ 17,875,000 $ 15,649,000 Change in federal tax rate (6,329,000 ) — — Accrued expenses 270,000 256,000 187,000 Stock option and warrant expenses 698,000 804,000 618,000 Accounts receivable 67,000 90,000 52,000 Deferred rent 24,000 36,000 44,000 Other 1,000 3,000 3,000 Total deferred tax assets 14,093,000 19,064,000 16,553,000 Valuation allowance (13,860,000 ) (18,475,000 ) (15,871,000 ) Net deferred tax assets 233,000 589,000 682,000 Deferred tax liabilities: Fixed and tangible assets (233,000 ) (589,000 ) (682,000 ) Total deferred tax liabilities (233,000 ) (589,000 ) (682,000 ) Total deferred tax assets (liabilities) $ — $ — $ — |
Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] | The following summary reconciles differences from taxes at the federal statutory rate with the effective rate: Twelve Months Ended 2017 2016 2015 Federal income tax at statutory rates (34.0 )% (34.0 )% (34.0 )% Change in deferred tax asset valuation allowance (81.7 )% 39.0 % 28.8 % Deferred state taxes (3.3 )% (3.2 )% (2.5 )% Non-deductible expenses: Change in value of acquisition liability 3.7 % — % — % Change in fair value of warrants — % — % 6.4 % ISO stock compensation 1.6 % 1.3 % 0.7 % Change in state & federal deferred rate 112.1 % (4.2 )% — % Other 1.6 % 1.1 % 0.6 % Income taxes (benefit) at effective rates — % — % — % |
Unaudited Quarterly Financial33
Unaudited Quarterly Financial Data (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information [Table Text Block] | The restated quarterly consolidated statements of operations for these quarterly periods are presented below: Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 8,154,674 $ (1,064,819 ) $ — $ — $ 7,089,855 Costs and expenses: Cost of revenue (exclusive of amortization) 3,758,621 (1,064,819 ) 608,824 — 3,302,626 Sales and marketing 2,342,002 — (608,824 ) — 1,733,178 General and administrative 2,687,266 — — (374,965 ) 2,312,301 Depreciation and amortization — — — 374,965 374,965 Total costs and expenses 8,787,889 (1,064,819 ) — — 7,723,070 Loss from operations (633,215 ) — — — (633,215 ) Other income (expense): Interest expense (15,058 ) (15,058 ) Change in fair value of derivatives, net 45,160 45,160 Other income (expense), net 44,308 44,308 Total other income (expense), net 74,410 — — — 74,410 Net loss $ (558,805 ) $ — $ — $ — $ (558,805 ) Weighted average common shares outstanding – basic and diluted 5,702,297 5,702,297 Basic and diluted loss per common share $ (0.10 ) $ (0.10 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 6,980,221 $ (1,267,317 ) $ — $ — $ 5,712,904 Costs and expenses: Cost of revenue (exclusive of amortization) 3,442,181 (1,267,317 ) 539,835 2,714,699 Sales and marketing 2,426,363 — (539,835 ) — 1,886,528 General and administrative 2,524,630 — — (358,260 ) 2,166,370 Depreciation and amortization — — — 358,260 358,260 Total costs and expenses 8,393,174 (1,267,317 ) — — 7,125,857 Loss from operations (1,412,953 ) — — — (1,412,953 ) Other income (expense): Interest expense (13,272 ) (13,272 ) Change in fair value of derivatives, net (8,420 ) (8,420 ) Other income (expense), net (11,953 ) (11,953 ) Total other income (expense), net (33,645 ) — — — (33,645 ) Net loss $ (1,446,598 ) $ — $ — $ — $ (1,446,598 ) Weighted average common shares outstanding – basic and diluted 5,676,629 5,676,629 Basic and diluted loss per common share $ (0.25 ) $ (0.25 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 6,202,506 $ (1,368,001 ) $ — $ — $ 4,834,505 Costs and expenses: Cost of revenue (exclusive of amortization) 3,195,526 (1,368,001 ) 509,535 2,337,060 Sales and marketing 2,898,355 — (509,535 ) — 2,388,820 General and administrative 2,809,524 — — (362,606 ) 2,446,918 Depreciation and amortization — — 362,606 362,606 Total costs and expenses 8,903,405 (1,368,001 ) — — 7,535,404 Loss from operations (2,700,899 ) — — — (2,700,899 ) Other income (expense): Interest expense (17,076 ) (17,076 ) Change in fair value of derivatives, net (618 ) (618 ) Other income (expense), net (627 ) (627 ) Total other income (expense), net (18,321 ) — — — (18,321 ) Net loss $ (2,719,220 ) $ — $ — $ — $ (2,719,220 ) Weighted average common shares outstanding – basic and diluted 5,598,200 5,598,200 Basic and diluted loss per common share $ (0.49 ) $ (0.49 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 7,433,991 $ (1,550,377 ) $ — $ — $ 5,883,614 Costs and expenses: Cost of revenue (exclusive of amortization) 3,795,209 (1,550,377 ) 643,460 2,888,292 Sales and marketing 2,705,246 — (643,460 ) — 2,061,786 General and administrative 2,723,490 — — (364,788 ) 2,358,702 Depreciation and amortization — — 364,788 364,788 Total costs and expenses 9,223,945 (1,550,377 ) — — 7,673,568 Loss from operations (1,789,954 ) — — — (1,789,954 ) Other income (expense): Interest expense (24,683 ) (24,683 ) Change in fair value of derivatives, net (5,405 ) (5,405 ) Other income (expense), net (9,590 ) (9,590 ) Total other income (expense), net (39,678 ) — — — (39,678 ) Net loss $ (1,829,632 ) $ — $ — $ — $ (1,829,632 ) Weighted average common shares outstanding – basic and diluted 5,450,005 5,450,005 Basic and diluted loss per common share $ (0.34 ) $ (0.34 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 7,496,972 $ (1,463,042 ) $ — $ — $ 6,033,930 Costs and expenses: Cost of revenue (exclusive of amortization) 3,927,279 (1,463,042 ) 595,877 3,060,114 Sales and marketing 2,584,287 — (595,877 ) — 1,988,410 General and administrative 2,454,555 — — (339,589 ) 2,114,966 Depreciation and amortization — — 339,589 339,589 Total costs and expenses 8,966,121 (1,463,042 ) — — 7,503,079 Loss from operations (1,469,149 ) — — — (1,469,149 ) Other income (expense): Interest expense (25,511 ) (25,511 ) Change in fair value of derivatives, net (14,705 ) (14,705 ) Other income (expense), net (2,238 ) (2,238 ) Total other income (expense), net (42,454 ) — — — (42,454 ) Net loss $ (1,511,603 ) $ — $ — $ — $ (1,511,603 ) Weighted average common shares outstanding – basic and diluted 5,420,020 5,420,020 Basic and diluted loss per common share $ (0.28 ) $ (0.28 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 6,913,689 $ (1,480,064 ) $ — $ — $ 5,433,625 Costs and expenses: Cost of revenue (exclusive of amortization) 3,418,387 (1,480,064 ) 586,546 2,524,869 Sales and marketing 2,612,714 — (571,696 ) — 2,041,018 General and administrative 2,524,746 — (14,850 ) (299,177 ) 2,210,719 Depreciation and amortization — — 299,177 299,177 Total costs and expenses 8,555,847 (1,480,064 ) — — 7,075,783 Loss from operations (1,642,158 ) — — — (1,642,158 ) Other income (expense): Interest expense (11,411 ) (11,411 ) Change in fair value of derivatives, net 26,421 26,421 Other income (expense), net 803 803 Total other income (expense), net 15,813 — — — 15,813 Net loss $ (1,626,345 ) $ — $ — $ — $ (1,626,345 ) Weighted average common shares outstanding – basic and diluted 5,350,128 5,350,128 Basic and diluted loss per common share $ (0.30 ) $ (0.30 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 5,465,950 $ (1,582,822 ) $ — $ 3,883,128 Costs and expenses: Cost of revenue (exclusive of amortization) 3,101,369 (1,582,822 ) 482,947 2,001,494 Sales and marketing 2,359,663 — (461,287 ) — 1,898,376 General and administrative 2,580,001 — (21,660 ) (296,297 ) 2,262,044 Depreciation and amortization — 296,297 296,297 Total costs and expenses 8,041,033 (1,582,822 ) — — 6,458,211 Loss from operations (2,575,083 ) — — — (2,575,083 ) Other income (expense): Interest expense (21,339 ) (21,339 ) Change in fair value of derivatives, net 2,852 2,852 Other income (expense), net 950 950 Total other income (expense), net (17,537 ) — — — (17,537 ) Net loss $ (2,592,620 ) $ — $ — $ — $ (2,592,620 ) Weighted average common shares outstanding – basic and diluted 5,300,520 5,300,520 Basic and diluted loss per common share $ (0.49 ) $ (0.49 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 6,262,233 $ (1,734,392 ) $ — $ — $ 4,527,841 Costs and expenses: Cost of revenue (exclusive of amortization) 3,587,608 (1,734,392 ) 489,381 2,342,597 Sales and marketing 2,626,091 — (468,981 ) — 2,157,110 General and administrative 2,435,748 — (20,400 ) (428,071 ) 1,987,277 Depreciation and amortization — — 428,071 428,071 Total costs and expenses 8,649,447 (1,734,392 ) — — 6,915,055 Loss from operations (2,387,214 ) — — — (2,387,214 ) Other income (expense): Interest expense (29,507 ) (29,507 ) Loss on exchange of warrants — — Change in fair value of derivatives, net 5,720 5,720 Other income (expense), net 4,120 4,120 Total other income (expense), net (19,667 ) — — — (19,667 ) Net loss $ (2,406,881 ) $ — $ — $ — $ (2,406,881 ) Weighted average common shares outstanding – basic and diluted 5,118,139 5,118,139 Basic and diluted loss per common share $ (0.47 ) $ (0.47 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 5,442,457 $ (1,722,518 ) $ — $ — $ 3,719,939 Costs and expenses: Cost of revenue (exclusive of amortization) 3,290,457 (1,722,518 ) 475,392 2,043,331 Sales and marketing 1,982,088 — (452,792 ) — 1,529,296 General and administrative 1,056,473 — (22,600 ) (230,553 ) 803,320 Depreciation and amortization — — 230,553 230,553 Total costs and expenses 6,329,018 (1,722,518 ) — — 4,606,500 Loss from operations (886,561 ) — — — (886,561 ) Other income (expense): Interest expense (31,191 ) (31,191 ) Loss on exchange of warrants (1,845,810 ) (1,845,810 ) Change in fair value of derivatives, net 115,904 115,904 Other income (expense), net 2,571 2,571 Total other income (expense), net (1,758,526 ) — — — (1,758,526 ) Net loss $ (2,645,087 ) $ — $ — $ — $ (2,645,087 ) Weighted average common shares outstanding – basic and diluted 4,075,605 4,075,605 Basic and diluted loss per common share $ (0.65 ) $ (0.65 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 4,627,742 $ (1,750,026 ) $ — $ — $ 2,877,716 Costs and expenses: Cost of revenue (exclusive of amortization) 2,917,360 (1,750,026 ) 414,398 1,581,732 Sales and marketing 1,746,549 — (397,398 ) — 1,349,151 General and administrative 2,164,380 — (17,000 ) (226,211 ) 1,921,169 Depreciation and amortization — — 226,211 226,211 Total costs and expenses 6,828,289 (1,750,026 ) — — 5,078,263 Loss from operations (2,200,547 ) — — — (2,200,547 ) Other income (expense): Interest expense (36,393 ) (36,393 ) Loss on exchange of warrants — — Change in fair value of derivatives, net 250,507 250,507 Other income (expense), net 1,142 1,142 Total other income (expense), net 215,256 — — — 215,256 Net loss $ (1,985,291 ) $ — $ — $ — $ (1,985,291 ) Weighted average common shares outstanding – basic and diluted 2,885,721 2,885,721 Basic and diluted loss per common share $ (0.69 ) $ (0.69 ) Three Months Ended As Previously Reported Workflow Revenue Adjustment Campaign Fulfillment Adjustment Depreciation & Amortization Reclassification As Restated Revenue $ 4,135,494 $ (1,151,305 ) $ — $ — $ 2,984,189 Costs and expenses: Cost of revenue (exclusive of amortization) 2,441,491 (1,151,305 ) 340,691 1,630,877 Sales and marketing 1,581,487 — (330,691 ) — 1,250,796 General and administrative 1,860,514 — (10,000 ) (174,296 ) 1,676,218 Depreciation and amortization — — 174,296 174,296 Total costs and expenses 5,883,492 (1,151,305 ) — — 4,732,187 Loss from operations (1,747,998 ) — — — (1,747,998 ) Other income (expense): Interest expense (18,770 ) (18,770 ) Loss on exchange of warrants — — Change in fair value of derivatives, net (2,505,951 ) (2,505,951 ) Other income (expense), net 1,807 1,807 Total other income (expense), net (2,522,914 ) — — — (2,522,914 ) Net loss $ (4,270,912 ) $ — $ — $ — $ (4,270,912 ) Weighted average common shares outstanding – basic and diluted 2,884,883 2,884,883 Basic and diluted loss per common share $ (1.48 ) $ (1.48 ) |
Company and Summary of Signif34
Company and Summary of Significant Accounting Policies - Accounts Receivable and Concentration of Credit Risk (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Concentration Risk [Line Items] | |||
Allowance for doubtful accounts receivable | $ 189,000 | $ 237,000 | $ 139,000 |
Bad debt expense percentage of revenues (percentage) | 1.00% | 1.00% | 1.00% |
Sales Revenue, Net [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, customer | 0 | 1 | 1 |
Revenue, major customer (percentage) | 10.00% | 11.00% | 12.00% |
Accounts Receivable [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, customer | 0 | no | 1 |
Revenue, major customer (percentage) | 10.00% | 10.00% | 13.00% |
Company and Summary of Signif35
Company and Summary of Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Computer Equipment [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, useful life (in years) | 3 years |
Software Costs [Member] | Minimum [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, useful life (in years) | 3 years |
Software Costs [Member] | Maximum [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, useful life (in years) | 5 years |
Office Equipment [Member] | Minimum [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, useful life (in years) | 3 years |
Office Equipment [Member] | Maximum [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, useful life (in years) | 10 years |
Furniture and Fixtures [Member] | Minimum [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, useful life (in years) | 5 years |
Furniture and Fixtures [Member] | Maximum [Member] | |
Significant Accounting Policies [Line Items] | |
Property, plant and equipment, useful life (in years) | 10 years |
Company and Summary of Signif36
Company and Summary of Significant Accounting Policies - Goodwill (Details) | 12 Months Ended |
Dec. 31, 2017operating_units | |
Accounting Policies [Abstract] | |
Number of Reporting Units | 1 |
Company and Summary of Signif37
Company and Summary of Significant Accounting Policies - Intangible Assets (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | |||
Other Asset Impairment Charges | $ 0 | $ 0 | $ 0 |
Minimum [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful life (in years) | 12 months | ||
Maximum [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful life (in years) | 60 months |
Company and Summary of Signif38
Company and Summary of Significant Accounting Policies - Software Development Costs (Details Textual) | 12 Months Ended |
Dec. 31, 2017 | |
Significant Accounting Policies [Line Items] | |
Amortization period of software development costs (in years) | 5 years |
Company and Summary of Signif39
Company and Summary of Significant Accounting Policies - Advertising Costs (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Selling and Marketing Expense [Member] | |||
Significant Accounting Policies [Line Items] | |||
Advertising costs | $ 324,000 | $ 455,000 | $ 558,000 |
Company and Summary of Signif40
Company and Summary of Significant Accounting Policies - Stock-Based Compensation (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Significant Accounting Policies [Line Items] | |||
Current average expected forfeiture rate (percentage) | 8.58% | 9.52% | 8.32% |
Equity Incentive 2011 Plan [Member] | |||
Significant Accounting Policies [Line Items] | |||
Expected term (in years) | 6 years | 6 years | 6 years |
Weighted average volatility (percentage) | 50.16% | 47.95% | 55.47% |
Weighted average risk free interest rate (percentage) | 2.06% | 1.58% | 1.65% |
Expected dividends | 0.00% | 0.00% | 0.00% |
Restatement (Details)
Restatement (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||||||
Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||||
Revenue | $ 24,437,649 | |||||||||||||
Cost of revenue (exclusive of amortization) | 11,585,316 | |||||||||||||
Sales and marketing | 7,593,197 | |||||||||||||
General and administrative | 9,218,565 | |||||||||||||
Depreciation and amortization | 1,516,807 | |||||||||||||
Total costs and expenses | 29,913,885 | |||||||||||||
Loss from operations | (5,476,236) | |||||||||||||
Interest expense | (64,950) | |||||||||||||
Loss on exchange of warrants | 0 | $ 0 | $ (1,845,810) | |||||||||||
Change in fair value of derivatives, net | 39,269 | |||||||||||||
Other income (expense), net | 34,218 | |||||||||||||
Total other income (expense), net | 8,537 | |||||||||||||
Net loss | $ (5,467,699) | $ (7,560,200) | $ (11,308,171) | |||||||||||
Weighted average common shares outstanding – basic and diluted | 5,674,901 | 5,380,465 | 3,737,897 | |||||||||||
Basic and diluted loss per common share | $ (0.96) | $ (1.41) | $ (3.03) | |||||||||||
Workflow Revenue Adjustment [Member] | ||||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||||
Revenue | $ (1,064,819) | $ (1,267,317) | $ (1,368,001) | $ (1,550,377) | $ (1,463,042) | $ (1,480,064) | $ (1,582,822) | $ (1,734,392) | $ (1,722,518) | $ (1,750,026) | $ (1,151,305) | $ (6,076,305) | $ (6,358,241) | |
Cost of revenue (exclusive of amortization) | (1,064,819) | (1,267,317) | (1,368,001) | (1,550,377) | (1,463,042) | (1,480,064) | (1,582,822) | (1,734,392) | (1,722,518) | (1,750,026) | (1,151,305) | (6,076,305) | (6,358,241) | |
Total costs and expenses | (1,064,819) | (1,267,317) | (1,368,001) | (1,550,377) | (1,463,042) | (1,480,064) | (1,582,822) | (1,734,392) | (1,722,518) | (1,750,026) | (1,151,305) | (6,076,305) | (6,358,241) | |
Loss from operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Total other income (expense), net | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Net loss | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Campaign Fulfillment Adjustment [Member] | ||||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||||
Revenue | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Cost of revenue (exclusive of amortization) | 608,824 | 539,835 | 509,535 | 643,460 | 595,877 | 586,546 | 482,947 | 489,381 | 475,392 | 414,398 | 340,691 | 2,308,830 | 1,719,862 | |
Sales and marketing | (608,824) | (539,835) | (509,535) | (643,460) | (595,877) | (571,696) | (461,287) | (468,981) | (452,792) | (397,398) | (330,691) | (2,272,320) | (1,649,862) | |
General and administrative | 0 | 0 | 0 | 0 | 0 | (14,850) | (21,660) | (20,400) | (22,600) | (17,000) | (10,000) | (36,510) | (70,000) | |
Depreciation and amortization | 0 | 0 | ||||||||||||
Total costs and expenses | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Loss from operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Total other income (expense), net | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Net loss | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Depreciation and Amortization Reclassification [Member] | ||||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||||
Revenue | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||
Cost of revenue (exclusive of amortization) | 0 | |||||||||||||
Sales and marketing | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||
General and administrative | (374,965) | (358,260) | (362,606) | (364,788) | (339,589) | (299,177) | (296,297) | (428,071) | (230,553) | (226,211) | (174,296) | (1,299,851) | (1,059,131) | |
Depreciation and amortization | 374,965 | 358,260 | 362,606 | 364,788 | 339,589 | 299,177 | 296,297 | 428,071 | 230,553 | 226,211 | 174,296 | 1,299,851 | 1,059,131 | |
Total costs and expenses | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Loss from operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Total other income (expense), net | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Net loss | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Scenario, Previously Reported [Member] | ||||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||||
Revenue | 8,154,674 | 6,980,221 | 6,202,506 | 7,433,991 | 7,496,972 | 6,913,689 | 5,465,950 | 6,262,233 | 5,442,457 | 4,627,742 | 4,135,494 | 27,310,602 | 20,467,926 | |
Cost of revenue (exclusive of amortization) | 3,758,621 | 3,442,181 | 3,195,526 | 3,795,209 | 3,927,279 | 3,418,387 | 3,101,369 | 3,587,608 | 3,290,457 | 2,917,360 | 2,441,491 | 14,242,244 | 12,236,916 | |
Sales and marketing | 2,342,002 | 2,426,363 | 2,898,355 | 2,705,246 | 2,584,287 | 2,612,714 | 2,359,663 | 2,626,091 | 1,982,088 | 1,746,549 | 1,581,487 | 10,261,910 | 7,936,215 | |
General and administrative | 2,687,266 | 2,524,630 | 2,809,524 | 2,723,490 | 2,454,555 | 2,524,746 | 2,580,001 | 2,435,748 | 1,056,473 | 2,164,380 | 1,860,514 | 10,282,792 | 7,517,115 | |
Depreciation and amortization | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Total costs and expenses | 8,787,889 | 8,393,174 | 8,903,405 | 9,223,945 | 8,966,121 | 8,555,847 | 8,041,033 | 8,649,447 | 6,329,018 | 6,828,289 | 5,883,492 | 34,786,946 | 27,690,246 | |
Loss from operations | (633,215) | (1,412,953) | (2,700,899) | (1,789,954) | (1,469,149) | (1,642,158) | (2,575,083) | (2,387,214) | (886,561) | (2,200,547) | (1,747,998) | (7,476,344) | (7,222,320) | |
Interest expense | (15,058) | (13,272) | (17,076) | (24,683) | (25,511) | (11,411) | (21,339) | (29,507) | (31,191) | (36,393) | (18,770) | (82,944) | (115,861) | |
Loss on exchange of warrants | 0 | (1,845,810) | 0 | 0 | (1,845,810) | |||||||||
Change in fair value of derivatives, net | 45,160 | (8,420) | (618) | (5,405) | (14,705) | 26,421 | 2,852 | 5,720 | 115,904 | 250,507 | (2,505,951) | 9,163 | (2,133,820) | |
Other income (expense), net | 44,308 | (11,953) | (627) | (9,590) | (2,238) | 803 | 950 | 4,120 | 2,571 | 1,142 | 1,807 | (10,075) | 9,640 | |
Total other income (expense), net | 74,410 | (33,645) | (18,321) | (39,678) | (42,454) | 15,813 | (17,537) | (19,667) | (1,758,526) | 215,256 | (2,522,914) | (83,856) | (4,085,851) | |
Net loss | $ (558,805) | $ (1,446,598) | $ (2,719,220) | $ (1,829,632) | $ (1,511,603) | $ (1,626,345) | $ (2,592,620) | $ (2,406,881) | $ (2,645,087) | $ (1,985,291) | $ (4,270,912) | $ (7,560,200) | $ (11,308,171) | |
Weighted average common shares outstanding – basic and diluted | 5,702,297 | 5,676,629 | 5,598,200 | 5,450,005 | 5,420,020 | 5,350,128 | 5,300,520 | 5,118,139 | 4,075,605 | 2,885,721 | 2,884,883 | 5,380,465 | 3,737,897 | |
Basic and diluted loss per common share | $ (0.10) | $ (0.25) | $ (0.49) | $ (0.34) | $ (0.28) | $ (0.30) | $ (0.49) | $ (0.47) | $ (0.65) | $ (0.69) | $ (1.48) | $ (1.41) | $ (3.03) | |
Restatement Adjustment [Member] | ||||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||||
Revenue | $ 7,089,855 | $ 5,712,904 | $ 4,834,505 | $ 5,883,614 | $ 6,033,930 | $ 5,433,625 | $ 3,883,128 | $ 4,527,841 | $ 3,719,939 | $ 2,877,716 | $ 2,984,189 | $ 21,234,297 | $ 14,109,685 | |
Cost of revenue (exclusive of amortization) | 3,302,626 | 2,714,699 | 2,337,060 | 2,888,292 | 3,060,114 | 2,524,869 | 2,001,494 | 2,342,597 | 2,043,331 | 1,581,732 | 1,630,877 | 10,474,769 | 7,598,537 | |
Sales and marketing | 1,733,178 | 1,886,528 | 2,388,820 | 2,061,786 | 1,988,410 | 2,041,018 | 1,898,376 | 2,157,110 | 1,529,296 | 1,349,151 | 1,250,796 | 7,989,590 | 6,286,353 | |
General and administrative | 2,312,301 | 2,166,370 | 2,446,918 | 2,358,702 | 2,114,966 | 2,210,719 | 2,262,044 | 1,987,277 | 803,320 | 1,921,169 | 1,676,218 | 8,946,431 | 6,387,984 | |
Depreciation and amortization | 374,965 | 358,260 | 362,606 | 364,788 | 339,589 | 299,177 | 296,297 | 428,071 | 230,553 | 226,211 | 174,296 | 1,299,851 | 1,059,131 | |
Total costs and expenses | 7,723,070 | 7,125,857 | 7,535,404 | 7,673,568 | 7,503,079 | 7,075,783 | 6,458,211 | 6,915,055 | 4,606,500 | 5,078,263 | 4,732,187 | 28,710,641 | 21,332,005 | |
Loss from operations | (633,215) | (1,412,953) | (2,700,899) | (1,789,954) | (1,469,149) | (1,642,158) | (2,575,083) | (2,387,214) | (886,561) | (2,200,547) | (1,747,998) | (7,476,344) | (7,222,320) | |
Interest expense | (15,058) | (13,272) | (17,076) | (24,683) | (25,511) | (11,411) | (21,339) | (29,507) | (31,191) | (36,393) | (18,770) | (82,944) | (115,861) | |
Loss on exchange of warrants | 0 | (1,845,810) | 0 | 0 | 0 | (1,845,810) | ||||||||
Change in fair value of derivatives, net | 45,160 | (8,420) | (618) | (5,405) | (14,705) | 26,421 | 2,852 | 5,720 | 115,904 | 250,507 | (2,505,951) | 9,163 | (2,133,820) | |
Other income (expense), net | 44,308 | (11,953) | (627) | (9,590) | (2,238) | 803 | 950 | 4,120 | 2,571 | 1,142 | 1,807 | (10,075) | 9,640 | |
Total other income (expense), net | 74,410 | (33,645) | (18,321) | (39,678) | (42,454) | 15,813 | (17,537) | (19,667) | (1,758,526) | 215,256 | (2,522,914) | (83,856) | (4,085,851) | |
Net loss | $ (558,805) | $ (1,446,598) | $ (2,719,220) | $ (1,829,632) | $ (1,511,603) | $ (1,626,345) | $ (2,592,620) | $ (2,406,881) | $ (2,645,087) | $ (1,985,291) | $ (4,270,912) | $ (7,560,200) | $ (11,308,171) | |
Weighted average common shares outstanding – basic and diluted | 5,702,297 | 5,676,629 | 5,598,200 | 5,450,005 | 5,420,020 | 5,350,128 | 5,300,520 | 5,118,139 | 4,075,605 | 2,885,721 | 2,884,883 | 5,380,465 | 3,737,897 | |
Basic and diluted loss per common share | $ (0.10) | $ (0.25) | $ (0.49) | $ (0.34) | $ (0.28) | $ (0.30) | $ (0.49) | $ (0.47) | $ (0.65) | $ (0.69) | $ (1.48) | $ (1.41) | $ (3.03) |
Business Acquisitions (Details
Business Acquisitions (Details Textual) - USD ($) | Jan. 30, 2017 | Jan. 30, 2016 | Jul. 31, 2015 | Jan. 30, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||||
Business Acquisition [Line Items] | ||||||||||||
Gain on settlement of acquisitions payable | $ 10,491 | $ 0 | $ 0 | |||||||||
Common Stock [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Stock issued for payment of acquisition liability (shares) | 200,542 | 200,605 | 31,821 | |||||||||
Ebyline, Inc. [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Business combination, contingent consideration arrangements, description | The Ebyline Stock Purchase Agreement was made up of a combination of guaranteed payments and contingent performance payments to be paid if Ebyline met certain revenue targets in the three years following the closing. None of these targets were met; therefore no amounts are due for contingent performance payments. | |||||||||||
Cash paid at closing | $ 1,200,000 | $ 3,327,064 | ||||||||||
Business combination, contingent consideration arrangements, change in range of outcomes, contingent consideration, liability, value, high | $ 1,900,000 | |||||||||||
Business combination, contingent consideration arrangements, basis for amount | subject to proportional reduction in the event Ebyline’s final 2014 revenue was below $8,000,000 | |||||||||||
Business acquisition, revenue reported by acquired entity for last annual period | $ 7,903,429 | |||||||||||
Business combination, consideration transferred, liabilities incurred | $ 1,877,064 | |||||||||||
Business combination, consideration transferred, liabilities incurred, installment payments | $ 938,532 | $ 938,532 | ||||||||||
Acquisition costs, interest rate terms | borrowing rate of prime plus 2% | |||||||||||
Interest expense, acquisition costs | $ 3,804 | $ 49,549 | $ 91,072 | |||||||||
Stock issued for payment of acquisition liability (shares) | 200,542 | 114,398 | ||||||||||
Business combinations, separately recognized transactions, content only revenue | $ 32,000,000 | 27,000,000 | 17,000,000 | |||||||||
Number of simulation trials | 100,000 | |||||||||||
Business combination, consideration transferred, equity interests issued and issuable | $ 848,832 | $ 250,000 | ||||||||||
Business combination, separately recognized transactions, additional disclosures, acquisition costs | $ 5,500,000 | |||||||||||
Fair value assumptions, risk adjusted discount | 8.50% | |||||||||||
Fair value assumption, simulation trials volatility rate | 35.00% | |||||||||||
Ebyline, Inc. [Member] | Maximum [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Total estimated consideration | $ 8,850,000 | |||||||||||
Ebyline, Inc. [Member] | Achieves at least 90% of Content-Only Revenue [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Business combination, contingent consideration arrangements, percentage of performance payment owed | 90.00% | |||||||||||
Ebyline, Inc. [Member] | Achieves less than 90% of Content-Only Revenue [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Business combination, contingent consideration arrangement, target revenue rate of reduction | 17.00% | |||||||||||
Ebyline, Inc. [Member] | Estimated Gross Purchase Consideration [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Total estimated consideration | $ 5,537,064 | |||||||||||
Cash paid at closing | [1] | 1,200,000 | ||||||||||
Contingent performance payments | [2] | 2,210,000 | $ 1,834,300 | |||||||||
Fair value of contingent performance payment, value, reduction related to continued employment of key employees | [2] | $ 357,700 | ||||||||||
Ebyline, Inc. [Member] | Remaining Present and Fair Value [Member] | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Total estimated consideration | 0 | 934,728 | 1,734,011 | |||||||||
Cash paid at closing | [1] | 0 | 0 | 0 | ||||||||
Acquisition costs payable by Ebyline shareholders | $ 89,700 | 0 | [3] | 0 | [3] | 89,700 | [3] | |||||
Contingent performance payments | [2] | $ 0 | $ 0 | $ 0 | ||||||||
[1] | The Ebyline Stock Purchase Agreement required a $1,200,000 cash payment at closing, a $250,000 stock payment on July 30, 2015 and a cash or stock payment of up to an additional $1,900,000 (subject to proportional reduction in the event Ebyline’s final 2014 revenue was below $8,000,000). Ebyline's final gross revenue for 2014 was $7,903,429. As such, the additional amount owed became $1,877,064 payable in two equal installments of $938,532 on January 30, 2016 and January 30, 2017. This guaranteed purchase price consideration was discounted to present value using the Company's borrowing rate of prime plus 2%. Interest expense imputed on the acquisition costs payable in the accompanying consolidated statements of operations was $3,804, $49,549, and $91,072 for the twelve months ended December 31, 2017, 2016, and 2015, respectively. Per the Ebyline Stock Purchase Agreement, the Company issued 31,821 shares of its common stock to satisfy the $250,000 guaranteed purchase price payment obligation on July 30, 2015. On January 29, 2016, the Company issued 114,398 shares of its common stock to satisfy the $848,832 annual guaranteed payment of $938,532 less $89,700 in closing related expenses (see item (c) below). On January 30, 2017, the Company issued 200,542 shares of common stock to satisfy the final annual guaranteed payment of $938,532. The Company recorded a $10,491 gain on the settlement of the acquisition costs payable in the accompanying consolidated statements of operations as a result of the difference between the market price of the stock on the settlement date and the 30-day average price of the stock required by the Ebyline Stock Purchase Agreement. | |||||||||||
[2] | Total contingent performance payments up to $5,500,000 are to be paid based on Ebyline meeting certain revenue targets. The performance payments are to be made only if Ebyline achieves at least 90% of Content Revenue targets of $17,000,000 in 2015, $27,000,000 in 2016 and $32,000,000 in 2017. These revenue targets were assumed on a gross transaction basis. The initial fair value of the $5,500,000 of contingent performance payments was calculated using a Monte-Carlo simulation to simulate revenue over three years. Since the contingent consideration has an option like structure, a risk-neutral framework was considered appropriate for the valuation. The Company started with a risk-adjusted measure of forecasted revenue (using a risk-adjusted discount rate of 8.5%) and assumed it will follow geometric brownian motion to simulate the revenue at future dates. Once the initial revenue was estimated based off of projections made during the acquisition, payout was calculated for each year and present valued to incorporate the credit risk associated with these payments. The Company's initial value conclusion was based on the average payment from 100,000 simulation trials. The volatility used for the simulation was 35%. The Monte Carlo simulation resulted in an initial calculated fair value of contingent performance payments of $2,210,000 on January 30, 2015. Because the contingent performance payments are subject to a 17% reduction related to the continued employment of certain key employees, ASC 805-10-55-25 indicates that a portion of these payments be treated as potential compensation to be accrued over the term rather than allocated to the purchase price. Therefore, the Company reduced its overall purchase price consideration by $357,700 and recorded the initial present value of the contingent performance payments at $1,834,300. The Content Revenue from 2015-2017 was below 90% of all of the required Content Revenues targets. Therefore, the Company reduced the fair value of contingent performance payments to zero by the end of 2015. The $1,834,300 decrease in the estimated fair value of contingent performance payments was recorded as a reduction of general and administrative expense in the Company's consolidated statement of operations during the year ended December 31, 2015. | |||||||||||
[3] | According to the Ebyline Stock Purchase Agreement, $89,700 in closing related expenses paid by Ebyline during the acquisition process were payable by the selling shareholders. These costs were deducted from the guaranteed payment on January 30, 2016. |
Business Acquisitions (Detail43
Business Acquisitions (Details 1) - USD ($) | Jan. 30, 2016 | Jan. 30, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||||
Business Acquisition [Line Items] | |||||||||
Current portion of acquisition costs payable | $ 741,155 | $ 1,252,885 | $ 844,931 | ||||||
Acquisition costs payable, less current portion | 609,768 | 688,191 | 889,080 | ||||||
Ebyline, Inc. [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Cash paid at closing | $ 1,200,000 | 3,327,064 | |||||||
Current portion of acquisition costs payable | 0 | 934,728 | 844,931 | ||||||
Acquisition costs payable, less current portion | 0 | 0 | 889,080 | ||||||
Total acquisition costs payable | 0 | 934,728 | 1,734,011 | ||||||
Ebyline, Inc. [Member] | Estimated Gross Purchase Consideration [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Cash paid at closing | [1] | 1,200,000 | |||||||
Guaranteed purchase price | [1] | 2,127,064 | |||||||
Contingent performance payments | [2] | 2,210,000 | 1,834,300 | ||||||
Total estimated consideration | 5,537,064 | ||||||||
Ebyline, Inc. [Member] | Initial Present Value [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Cash paid at closing | [1] | 1,200,000 | |||||||
Guaranteed purchase price | [1] | 1,982,639 | |||||||
Contingent performance payments | [2] | 1,834,300 | |||||||
Acquisition costs payable by Ebyline shareholders | [3] | 0 | |||||||
Total estimated consideration | $ 5,016,939 | ||||||||
Ebyline, Inc. [Member] | Remaining Present and Fair Value [Member] | |||||||||
Business Acquisition [Line Items] | |||||||||
Cash paid at closing | [1] | 0 | 0 | 0 | |||||
Guaranteed purchase price | [1] | 0 | 934,728 | 1,823,711 | |||||
Contingent performance payments | [2] | 0 | 0 | 0 | |||||
Acquisition costs payable by Ebyline shareholders | $ (89,700) | 0 | [3] | 0 | [3] | (89,700) | [3] | ||
Total estimated consideration | $ 0 | $ 934,728 | $ 1,734,011 | ||||||
[1] | The Ebyline Stock Purchase Agreement required a $1,200,000 cash payment at closing, a $250,000 stock payment on July 30, 2015 and a cash or stock payment of up to an additional $1,900,000 (subject to proportional reduction in the event Ebyline’s final 2014 revenue was below $8,000,000). Ebyline's final gross revenue for 2014 was $7,903,429. As such, the additional amount owed became $1,877,064 payable in two equal installments of $938,532 on January 30, 2016 and January 30, 2017. This guaranteed purchase price consideration was discounted to present value using the Company's borrowing rate of prime plus 2%. Interest expense imputed on the acquisition costs payable in the accompanying consolidated statements of operations was $3,804, $49,549, and $91,072 for the twelve months ended December 31, 2017, 2016, and 2015, respectively. Per the Ebyline Stock Purchase Agreement, the Company issued 31,821 shares of its common stock to satisfy the $250,000 guaranteed purchase price payment obligation on July 30, 2015. On January 29, 2016, the Company issued 114,398 shares of its common stock to satisfy the $848,832 annual guaranteed payment of $938,532 less $89,700 in closing related expenses (see item (c) below). On January 30, 2017, the Company issued 200,542 shares of common stock to satisfy the final annual guaranteed payment of $938,532. The Company recorded a $10,491 gain on the settlement of the acquisition costs payable in the accompanying consolidated statements of operations as a result of the difference between the market price of the stock on the settlement date and the 30-day average price of the stock required by the Ebyline Stock Purchase Agreement. | ||||||||
[2] | Total contingent performance payments up to $5,500,000 are to be paid based on Ebyline meeting certain revenue targets. The performance payments are to be made only if Ebyline achieves at least 90% of Content Revenue targets of $17,000,000 in 2015, $27,000,000 in 2016 and $32,000,000 in 2017. These revenue targets were assumed on a gross transaction basis. The initial fair value of the $5,500,000 of contingent performance payments was calculated using a Monte-Carlo simulation to simulate revenue over three years. Since the contingent consideration has an option like structure, a risk-neutral framework was considered appropriate for the valuation. The Company started with a risk-adjusted measure of forecasted revenue (using a risk-adjusted discount rate of 8.5%) and assumed it will follow geometric brownian motion to simulate the revenue at future dates. Once the initial revenue was estimated based off of projections made during the acquisition, payout was calculated for each year and present valued to incorporate the credit risk associated with these payments. The Company's initial value conclusion was based on the average payment from 100,000 simulation trials. The volatility used for the simulation was 35%. The Monte Carlo simulation resulted in an initial calculated fair value of contingent performance payments of $2,210,000 on January 30, 2015. Because the contingent performance payments are subject to a 17% reduction related to the continued employment of certain key employees, ASC 805-10-55-25 indicates that a portion of these payments be treated as potential compensation to be accrued over the term rather than allocated to the purchase price. Therefore, the Company reduced its overall purchase price consideration by $357,700 and recorded the initial present value of the contingent performance payments at $1,834,300. The Content Revenue from 2015-2017 was below 90% of all of the required Content Revenues targets. Therefore, the Company reduced the fair value of contingent performance payments to zero by the end of 2015. The $1,834,300 decrease in the estimated fair value of contingent performance payments was recorded as a reduction of general and administrative expense in the Company's consolidated statement of operations during the year ended December 31, 2015. | ||||||||
[3] | According to the Ebyline Stock Purchase Agreement, $89,700 in closing related expenses paid by Ebyline during the acquisition process were payable by the selling shareholders. These costs were deducted from the guaranteed payment on January 30, 2016. |
Business Acquisitions (Detail44
Business Acquisitions (Details Textual 2) - USD ($) | Jul. 31, 2016 | Jul. 31, 2016 | Jul. 31, 2019 | Jul. 31, 2018 | Dec. 31, 2017 | Jul. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Business Acquisition [Line Items] | ||||||||||
Volatility range of inputs (percentage) | [1] | 55.91% | 83.00% | |||||||
ZenContent [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business combination, consideration transferred, payment period (years) | 3 years | |||||||||
Business combination, consideration transferred | $ 1,796,547 | |||||||||
Business combination, contingent consideration arrangements, description | three equal annual installment payments totaling $1,000,000 | |||||||||
Business combination guarantee fee reduction amount | $ 300,000 | |||||||||
Compensation expense, acquisition guaranteed payments | 162,500 | $ 102,431 | ||||||||
Guarantee purchase price basis spread on variable rate | 2.00% | |||||||||
Interest expense, acquisition costs | 28,463 | 13,370 | ||||||||
Volatility range of inputs (percentage) | 45.00% | |||||||||
Business combination, contingent consideration arrangement, target revenue rate of reduction | 30.00% | |||||||||
Simulation interest rate | 6.50% | |||||||||
Fair value inputs, discount rate | 5.50% | |||||||||
Business combinations, separately recognized transactions, content only revenue | $ 2,500,000 | |||||||||
Business combination, contingent consideration, percentage paid in cash | 33.00% | 33.00% | ||||||||
Fair value assumptions, risk adjusted discount | 17.00% | |||||||||
Number of simulation trials | 250,000 | |||||||||
Compensation expense, acquisition contingent payments | 185,945 | |||||||||
Business combination, contingent consideration arrangements, change in amount of contingent consideration, liability | 234,565 | |||||||||
Increase in the fair value of the contingent performance payments | 94,000 | |||||||||
ZenContent [Member] | General and Administrative Expense [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business combination, contingent consideration arrangements, change in amount of contingent consideration, liability | 420,510 | |||||||||
ZenContent [Member] | Maximum [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business combination, consideration transferred | $ 4,500,000 | |||||||||
ZenContent [Member] | Subsequent Event [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business combinations, separately recognized transactions, content only revenue | $ 4,500,000 | $ 3,500,000 | ||||||||
ZenContent [Member] | Working Capital Adjustment [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business combination, provisional information, initial accounting incomplete, adjustment, consideration transferred | 66,435 | |||||||||
ZenContent [Member] | Estimated Gross Purchase Consideration [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business combination, consideration transferred | 4,433,565 | |||||||||
Payments to acquire businesses, gross | [2] | $ 400,000 | ||||||||
Stock issued for payment of acquisition liability (shares) | 86,207 | |||||||||
Business combination, consideration transferred, equity interests issued and issuable | $ 600,000 | |||||||||
Contingent performance payments | [3] | 2,500,000 | ||||||||
ZenContent [Member] | Initial Present Value [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business combination, consideration transferred | 1,796,547 | |||||||||
Payments to acquire businesses, gross | [2] | 400,000 | ||||||||
Business combination, consideration transferred, equity interests issued and issuable | [2] | $ 600,000 | ||||||||
Contingent performance payments | [3] | 230,000 | ||||||||
ZenContent [Member] | Remaining Present and Fair Value [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business combination, consideration transferred | 1,350,923 | 1,006,348 | ||||||||
Payments to acquire businesses, gross | 0 | 0 | [2] | |||||||
Business combination, consideration transferred, equity interests issued and issuable | 0 | 0 | [2] | |||||||
Contingent performance payments | [3] | $ 744,510 | $ 324,000 | |||||||
[1] | The Company does not have a market trading history upon which to base its forward-looking volatility. Accordingly, the Company selected peer companies that provided a reasonable basis upon which to calculate volatility for each of the intervals described in (2), above. | |||||||||
[2] | The aggregate consideration paid at closing for the acquisition of ZenContent consisted of a cash payment of $400,000 and the issuance of 86,207 shares of IZEA common stock valued at $600,000. | |||||||||
[3] | The contingent performance payments are subject to ZenContent achieving certain minimum revenue thresholds over 36 months. ZenContent is required to meet minimum revenues of $2.5 million, $3.5 million and $4.5 million in the first, second and third, respective 12-month periods following the closing in order to receive any portion of the contingent performance payments. Of these payments, 33% of each such annual installment or contingent performance payment will be in the form of cash and the remainder of such payment will be in the form of either cash or additional shares of IZEA common stock at then average stock prices (determined at IZEA’s option). Additionally, these payments are subject to downward adjustment of up to 30% if Brianna DeMike is terminated by IZEA for cause or she terminates her employment without good reason. The Company initially determined the fair value of the $2,500,000 contingent payments to be $230,000. The fair value of the contingent performance payments is required to be revalued each quarter and is calculated using a Monte-Carlo simulation to simulate revenue over the future periods. Since the contingent consideration has an option like structure, a risk-neutral framework is considered appropriate for the valuation. The Company started with a risk-adjusted measure of forecasted revenue (using a risk-adjusted discount rate of 17%) and assumed it will follow geometric brownian motion to simulate the revenue at future dates. Once the initial revenue was estimated based off of projections, payout was calculated for each year and present valued to incorporate the credit risk associated with these payments. The Company's fair value conclusion was based on the average payment from 250,000 simulation trials. The volatility used for the simulation was 45%. The interest rate used for the simulation was the Company's current borrowing rate of prime plus 2% (6.5%). The Company revalued its estimate of the contingent performance payment as of December 31, 2017 based on actual results and projections and the rates noted above and determined that current fair value of the contingent performance payments was $744,510 compared to $324,000 as of December 31, 2016. The change in the estimated fair value of contingent performance payable resulted in a $420,510 increase to general and administrative expense in the Company's consolidated statement of operations during the twelve months ended December 31, 2017. Of this amount, $185,945 was allocated to compensation expense and a gain of $234,565 was allocated as a change in the fair value of the contingent performance payments. The Company recorded a $94,000 increase in the fair value of the contingent performance payments during the twelve months ended December 31, 2016 for the change from the initial value of $230,000 to $324,000 as of December 31, 2016. |
Business Acquisitions (Detail45
Business Acquisitions (Details 2) - USD ($) | Jul. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Business Acquisition [Line Items] | ||||||
Current portion of acquisition costs payable | $ 741,155 | $ 1,252,885 | $ 844,931 | |||
Acquisition costs payable, less current portion | 609,768 | 688,191 | $ 889,080 | |||
ZenContent [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Total estimated consideration | $ 1,796,547 | |||||
Current portion of acquisition costs payable | 741,155 | 318,157 | ||||
Acquisition costs payable, less current portion | 609,768 | 688,191 | ||||
Total acquisition costs payable | 1,350,923 | 1,006,348 | ||||
Estimated Gross Purchase Consideration [Member] | ZenContent [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Cash paid at closing | [1] | 400,000 | ||||
Business combination, consideration transferred, equity interests issued and issuable | 600,000 | |||||
Guaranteed purchase price | [2] | 933,565 | ||||
Contingent performance payments | [3] | 2,500,000 | ||||
Total estimated consideration | 4,433,565 | |||||
Initial Present Value [Member] | ZenContent [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Cash paid at closing | [1] | 400,000 | ||||
Business combination, consideration transferred, equity interests issued and issuable | [1] | 600,000 | ||||
Guaranteed purchase price | [2] | 566,547 | ||||
Contingent performance payments | [3] | 230,000 | ||||
Total estimated consideration | $ 1,796,547 | |||||
Remaining Present and Fair Value [Member] | ZenContent [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Cash paid at closing | 0 | 0 | [1] | |||
Business combination, consideration transferred, equity interests issued and issuable | 0 | 0 | [1] | |||
Guaranteed purchase price | [2] | 606,413 | 682,348 | |||
Contingent performance payments | [3] | 744,510 | 324,000 | |||
Total estimated consideration | $ 1,350,923 | $ 1,006,348 | ||||
[1] | The aggregate consideration paid at closing for the acquisition of ZenContent consisted of a cash payment of $400,000 and the issuance of 86,207 shares of IZEA common stock valued at $600,000. | |||||
[2] | Aggregate future consideration consists of (i) three equal annual installment payments totaling $1,000,000, commencing 12 months following the closing, less a reduction of $66,435 due to a customary closing date working capital adjustment (“guaranteed purchase price”), and (ii) contingent performance payments up to an aggregate of $2,500,000 over the three 12-month periods following the closing. These payments are also subject to a downward adjustment up to 30% if Brianna DeMike, ZenContent’s co-founder, is terminated by IZEA for cause or if she terminates her employment without good reason. As a result, the Company initially reduced its acquisition cost liability by $300,000 to be accrued as compensation expense over the three-year term rather than allocated to the initial purchase price in accordance with ASC 805-10-55-25. Compensation expense added to the guaranteed acquisition costs payable and recorded as general and administrative expense in the Company's consolidated statement of operations was $162,500 and $102,431for the twelve months ended December 31, 2017 and 2016, respectively. The initial guaranteed purchase price consideration was discounted to present value using the Company's borrowing rate of prime plus 2% (5.5% on July 31, 2016). Interest expense imputed on the guaranteed acquisition costs payable in the accompanying consolidated statement of operations was $28,463 and $13,370 for the twelve months ended December 31, 2017 and 2016. | |||||
[3] | The contingent performance payments are subject to ZenContent achieving certain minimum revenue thresholds over 36 months. ZenContent is required to meet minimum revenues of $2.5 million, $3.5 million and $4.5 million in the first, second and third, respective 12-month periods following the closing in order to receive any portion of the contingent performance payments. Of these payments, 33% of each such annual installment or contingent performance payment will be in the form of cash and the remainder of such payment will be in the form of either cash or additional shares of IZEA common stock at then average stock prices (determined at IZEA’s option). Additionally, these payments are subject to downward adjustment of up to 30% if Brianna DeMike is terminated by IZEA for cause or she terminates her employment without good reason. The Company initially determined the fair value of the $2,500,000 contingent payments to be $230,000. The fair value of the contingent performance payments is required to be revalued each quarter and is calculated using a Monte-Carlo simulation to simulate revenue over the future periods. Since the contingent consideration has an option like structure, a risk-neutral framework is considered appropriate for the valuation. The Company started with a risk-adjusted measure of forecasted revenue (using a risk-adjusted discount rate of 17%) and assumed it will follow geometric brownian motion to simulate the revenue at future dates. Once the initial revenue was estimated based off of projections, payout was calculated for each year and present valued to incorporate the credit risk associated with these payments. The Company's fair value conclusion was based on the average payment from 250,000 simulation trials. The volatility used for the simulation was 45%. The interest rate used for the simulation was the Company's current borrowing rate of prime plus 2% (6.5%). The Company revalued its estimate of the contingent performance payment as of December 31, 2017 based on actual results and projections and the rates noted above and determined that current fair value of the contingent performance payments was $744,510 compared to $324,000 as of December 31, 2016. The change in the estimated fair value of contingent performance payable resulted in a $420,510 increase to general and administrative expense in the Company's consolidated statement of operations during the twelve months ended December 31, 2017. Of this amount, $185,945 was allocated to compensation expense and a gain of $234,565 was allocated as a change in the fair value of the contingent performance payments. The Company recorded a $94,000 increase in the fair value of the contingent performance payments during the twelve months ended December 31, 2016 for the change from the initial value of $230,000 to $324,000 as of December 31, 2016. |
Business Acquisitions (Detail46
Business Acquisitions (Details Textual 3) - ZenContent [Member] | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Business Acquisition [Line Items] | |
Revenues | $ 936,194 |
Gross Profit | 436,395 |
General and Administrative Expense [Member] | |
Business Acquisition [Line Items] | |
Business Combination, Acquisition Related Costs | $ 52,665 |
Business Acquisitions (Detail47
Business Acquisitions (Details 3) - ZenContent [Member] | Jul. 31, 2016USD ($) |
Business Acquisition [Line Items] | |
Business combination, consideration transferred | $ 1,796,547 |
Current Assets [Member] | |
Business Acquisition [Line Items] | |
Business combination, consideration transferred | 415,798 |
Property, Plant and Equipment [Member] | |
Business Acquisition [Line Items] | |
Business combination, consideration transferred | 4,551 |
Identifiable intangible assets [Member] | |
Business Acquisition [Line Items] | |
Business combination, consideration transferred | 722,000 |
Goodwill [Member] | |
Business Acquisition [Line Items] | |
Business combination, consideration transferred | 1,136,431 |
Current Liabilities [Member] | |
Business Acquisition [Line Items] | |
Business combination, consideration transferred, liabilities incurred | $ (482,233) |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | $ 1,076,072 | $ 1,076,706 | $ 1,041,979 |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | (790,029) | (616,056) | (445,971) |
Property and equipment, net | 286,043 | 460,650 | 596,008 |
Furniture and Fixtures [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 254,099 | 254,206 | 252,516 |
Office Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 74,627 | 65,463 | 53,265 |
Computer Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Capital Leased Assets, Gross | 59,458 | ||
Capital Leases, Lessee Balance Sheet, Assets by Major Class, Accumulated Depreciation | 37,341 | ||
Property, Plant and Equipment, Gross | 415,928 | 432,321 | 421,798 |
Leasehold Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Property, Plant and Equipment, Gross | 331,418 | 324,716 | 314,400 |
Depreciation and Amortization Expense [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Depreciation | $ 211,769 | $ 253,004 | $ 206,670 |
Intangible Assets (Details 1)
Intangible Assets (Details 1) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | $ 3,258,469 | $ 3,258,469 | $ 2,536,469 |
Finite-Lived Intangible Assets, Accumulated Amortization | 2,590,560 | 1,595,933 | 730,278 |
Content Provider Network [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | 160,000 | 160,000 | 30,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | $ 122,083 | 57,083 | 27,500 |
Useful life (in years) | 1 year | ||
Trade Names [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | $ 52,000 | 52,000 | 40,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | $ 52,000 | 45,000 | 36,667 |
Useful life (in years) | 1 year | ||
Developed Technology Rights [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | $ 530,000 | 530,000 | 300,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | $ 240,167 | 134,167 | 55,000 |
Useful life (in years) | 3 years | ||
Self-service Content Customers [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | $ 210,000 | 210,000 | 210,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | $ 204,167 | 134,167 | 64,167 |
Useful life (in years) | 5 years | ||
Managed content customers [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | $ 2,140,000 | 2,140,000 | 1,790,000 |
Finite-Lived Intangible Assets, Accumulated Amortization | $ 1,905,555 | 1,192,222 | 546,944 |
Useful life (in years) | 3 years | ||
Internet Domain Names [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | $ 166,469 | 166,469 | 166,469 |
Finite-Lived Intangible Assets, Accumulated Amortization | $ 66,588 | $ 33,294 | $ 0 |
Useful life (in years) | 5 years |
Intangible Assets (Details 2)
Intangible Assets (Details 2) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Finite-Lived Intangible Assets [Line Items] | |||
Total Intangible Assets | $ 3,258,469 | $ 3,258,469 | $ 2,536,469 |
Accumulated amortization | (2,590,560) | (1,595,933) | (730,278) |
Intangible assets, net | 667,909 | 1,662,536 | 1,806,191 |
Internet Domain Names [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Total Intangible Assets | 166,469 | 166,469 | 166,469 |
Accumulated amortization | (66,588) | (33,294) | 0 |
Ebyline, Inc. [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Total Intangible Assets | 2,370,000 | 2,370,000 | 2,370,000 |
ZenContent [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Total Intangible Assets | $ 722,000 | $ 722,000 | $ 0 |
Intangible Assets (Details 3)
Intangible Assets (Details 3) | Dec. 31, 2017USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Finite-Lived Intangible Assets, 2018 | $ 349,433 |
Finite-Lived Intangible Assets, 2019 | 207,349 |
Finite-Lived Intangible Assets, 2020 | 84,293 |
Finite-Lived Intangible Assets, 2021 | 26,834 |
Finite-Lived Intangible Assets, Net | $ 667,909 |
Intangible Assets (Details Text
Intangible Assets (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | |||
Acquired finite-lived intangible assets, weighted average useful life (years) | 3 years | ||
Amortization of intangible assets | $ 1,305,038 | $ 1,046,847 | $ 852,461 |
Cost of Acquired Technology [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of intangible assets | 106,000 | 79,167 | 55,000 |
Depreciation and Amortization Expense [Member] | Ebyline and ZenContent related identifiable intangible assets[Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization of intangible assets | $ 994,627 | $ 865,655 | $ 730,278 |
Software Development Costs (Det
Software Development Costs (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Research and Development [Abstract] | |||
Software development costs | $ 1,492,665 | $ 1,021,446 | |
Less accumulated depreciation and amortization | $ (593,424) | (388,706) | (207,514) |
Software development costs, net | $ 967,927 | $ 1,103,959 | $ 813,932 |
Software Development Costs (D54
Software Development Costs (Details 1) | Dec. 31, 2017USD ($) |
Finite-Lived Intangible Assets [Line Items] | |
Software Amortization Expense, 2019 | $ 349,433 |
Software Amortization Expense, 2020 | 207,349 |
Software Amortization Expense, 2021 | 84,293 |
Software Amortization Expense, 2022 | 26,834 |
Software Amortization Expense, Net | 667,909 |
Software and Software Development Costs [Member] | |
Finite-Lived Intangible Assets [Line Items] | |
Software Amortization Expense, 2018 | 294,487 |
Software Amortization Expense, 2019 | 226,939 |
Software Amortization Expense, 2020 | 193,611 |
Software Amortization Expense, 2021 | 152,216 |
Software Amortization Expense, 2022 | 82,891 |
Software Amortization Expense, Thereafter | 17,783 |
Software Amortization Expense, Net | $ 967,927 |
Software Development Costs (D55
Software Development Costs (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | |||
Capitalized computer software, gross | $ 1,492,665 | $ 1,021,446 | |
Maximum [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful life (in years) | 60 months | ||
Software Development [Member] | Maximum [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful life (in years) | 5 years | ||
Depreciation and Amortization Expense [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Capitalized computer software, amortization | $ 310,411 | $ 181,192 | $ 122,183 |
Software Development Costs [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Capitalized computer software, gross | $ 1,561,351 |
Derivative Financial (Details)
Derivative Financial (Details) - USD ($) | Aug. 14, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Aug. 14, 2015 | Jun. 30, 2015 | Jan. 22, 2015 |
Warrant Liability [Roll Forward] | |||||||
Warrant liability | $ 0 | $ 5,060 | |||||
Fair value of warrants issued | 0 | 0 | $ (51,950) | ||||
Loss on exchange of warrants | 0 | 0 | 1,845,810 | ||||
Warrants and rights outstanding | $ (44,250) | $ (7,700) | |||||
Change in fair value of derivatives, net | 39,269 | ||||||
Warrant liability | $ 0 | $ 0 | $ 5,060 | ||||
Private Placement [Member] | |||||||
Linked Common Shares to Derivative Warrants [Roll Forward] | |||||||
Number of common shares linked to derivative warrants (shares) | 5,502 | 6,196 | 1,795,564 | ||||
Expiration of warrants (shares) | (5,502) | (694) | |||||
Change in fair value of derivatives (shares) | 0 | 0 | |||||
Number of common shares linked to derivative warrants (shares) | 0 | 5,502 | 6,196 | ||||
Warrant Liability [Roll Forward] | |||||||
Warrant liability | $ 0 | $ 5,060 | $ 3,203,465 | ||||
Expiration of warrants | 0 | 0 | |||||
Change in fair value of derivatives, net | (5,060) | 2,133,820 | |||||
Warrant liability | $ 0 | $ 0 | $ 5,060 | ||||
2014 Warrants [Member] | |||||||
Linked Common Shares to Derivative Warrants [Roll Forward] | |||||||
Class of warrant or right, number of securities called by warrants or rights | (1,392,832) | ||||||
Loss on exchange of warrants, shares | 0 | ||||||
Class of warrant or right, outstanding | (396,536) | ||||||
Warrant Liability [Roll Forward] | |||||||
Fair value of warrants issued | $ (5,348,408) | ||||||
Loss on exchange of warrants | $ 1,197,821 | ||||||
Warrants and rights outstanding | $ (1,181,638) |
Derivative Financial (Details 2
Derivative Financial (Details 2) - $ / shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||
Fair market value of asset | [1] | $ 4.51 | $ 7.66 |
Exercise price | $ 25 | $ 25 | |
Term | [2] | 8 months | 1 year 8 months |
Implied expected life | [3] | 8 months | 1 year 8 months |
Volatility range of inputs | [4] | 55.91% | 83.00% |
Equivalent volatility | [3] | 55.91% | 83.00% |
Risk-free interest rate range of inputs | [5] | 0.85% | 1.06% |
Equivalent risk-free interest rate | [3] | 0.85% | 1.06% |
[1] | The fair market value of the asset was determined by using the Company's closing stock price as reflected on the OTCQB for the period ended December 31, 2015 and on the Nasdaq Capital Market for the period ended December 31, 2016. | ||
[2] | The term is the contractual remaining term, allocated among twelve equal intervals for purposes of calculating other inputs, such as volatility and risk-free rate. | ||
[3] | The implied expected life, and equivalent volatility and risk-free interest rate amounts are derived from the Binomial. | ||
[4] | The Company does not have a market trading history upon which to base its forward-looking volatility. Accordingly, the Company selected peer companies that provided a reasonable basis upon which to calculate volatility for each of the intervals described in (2), above. | ||
[5] | The risk-free rates used for inputs represent the yields on zero coupon U.S. Government Securities with periods to maturity consistent with the intervals described in (2), above. |
Derivative Financial (Details T
Derivative Financial (Details Textual) - USD ($) | Aug. 14, 2017 | Jan. 22, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Aug. 14, 2015 | Jun. 30, 2015 |
Derivative [Line Items] | |||||||
Class of warrant or right, exercise price of warrants or rights | $ 10.20 | $ 10.20 | |||||
Proceeds from issuance of warrants | $ 100 | ||||||
Loss on exchange of warrants | $ 0 | $ 0 | $ 1,845,810 | ||||
Fair value of warrants issued | 0 | 0 | 51,950 | ||||
Warrants and rights outstanding | $ (7,700) | $ (44,250) | |||||
Change in fair value of derivatives, net | 39,269 | ||||||
Derivative, gain on derivative | $ 39,269 | 4,103 | |||||
Private Placement [Member] | |||||||
Derivative [Line Items] | |||||||
Change in fair value of derivatives, net | (5,060) | 2,133,820 | |||||
2014 Warrants [Member] | |||||||
Derivative [Line Items] | |||||||
Class of warrants or rights discount on warrant exercise price | 26.00% | ||||||
Series A 2014 Warrants [Member] | |||||||
Derivative [Line Items] | |||||||
Class of warrant or right, exercise price of warrants or rights | $ 7 | ||||||
2014 Warrants [Member] | |||||||
Derivative [Line Items] | |||||||
Class of warrants or rights discount on warrant exercise price | 26.00% | ||||||
Class of warrant or right, number of securities called by warrants or rights | (1,392,832) | ||||||
Proceeds from issuance of warrants | $ 8,760,805 | ||||||
Loss on exchange of warrants | $ 1,197,821 | ||||||
Fair value of warrants issued | $ 5,348,408 | ||||||
Warrants and rights outstanding | $ (1,181,638) | ||||||
Class of warrant or right, outstanding | (396,536) | ||||||
Series B 2014 Warrants [Member] | |||||||
Derivative [Line Items] | |||||||
Class of warrant or right, exercise price of warrants or rights | $ 10 | ||||||
Liability [Member] | September 2012 Public Offering [Member] | |||||||
Derivative [Line Items] | |||||||
Warrant shares issued | 5,502 | ||||||
Warrant [Member] | Private Placement [Member] | |||||||
Derivative [Line Items] | |||||||
Derivative, gain on derivative | $ 5,060 |
Commitments and Contingencies59
Commitments and Contingencies (Details Textual) | Apr. 13, 2015USD ($) | Dec. 31, 2017USD ($)ft² | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Other Commitments [Line Items] | ||||
Defined contribution plan, employer matching contribution, percent of match (percent) | 50.00% | |||
Capital Lease Obligations | $ 0 | |||
Length of rental sublease agreement (lease term) | sixty-five month | |||
Lessee, operating sublease, option to extend (lease term) | one additional year until April 30, 2020 | |||
Size of leased building (square feet) | ft² | 15,500 | |||
Defined contribution plan, employer matching contribution, percent of employees' gross pay | 8.00% | |||
Defined contribution plan, employer matching contribution, annual vesting percentage (percentage) | 20.00% | |||
Defined contribution plan, employer matching contribution, number of years of service required for participant vesting (years) | 2 years | |||
Defined contribution plan, employer discretionary contribution amount | $ 201,003 | 166,271 | $ 125,262 | |
Secured Line of Credit Facility [Member] | Credit Agreement [Member] | ||||
Other Commitments [Line Items] | ||||
Eligible securitization percentage of accounts receivable (percentage) | 80.00% | |||
Line of credit facility, maximum borrowing capacity | $ 5,000,000 | |||
Debt instrument, annual facility fee | $ 20,000 | |||
Line of credit facility, commitment fee percentage (percentage) | 0.40% | |||
Line of credit facility, annual due diligence fee | $ 1,000 | |||
Debt instrument, description of variable rate basis | prime plus 2% per annum | |||
Debt instrument, description of default rate of interest | prime plus 7% | |||
Line of credit | 500,550 | |||
Line of credit facility, average outstanding amount | 0 | |||
Accounts receivable, net | 3,647,025 | 3,745,695 | 3,917,925 | |
Line of credit facility, current borrowing capacity | $ 2,457,180 | |||
Debt issuance cost amortization period (years) | 1 year | |||
Amortization of debt issuance costs | $ 21,000 | 19,796 | 18,388 | |
Debt issuance costs, net | $ 7,000 | |||
Capitalized loan costs amortization period (month) | 4 months | |||
Minimum [Member] | ||||
Other Commitments [Line Items] | ||||
Payments for Rent | $ 17.50 | |||
Maximum [Member] | ||||
Other Commitments [Line Items] | ||||
Payments for Rent | 22.50 | |||
General and Administrative Expense [Member] | ||||
Other Commitments [Line Items] | ||||
Operating Leases, Rent Expense | $ 579,346 | $ 618,940 | $ 491,543 |
Commitments and Contingencies60
Commitments and Contingencies (Details) | Dec. 31, 2017USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Operating Leases, Future Minimum Payments Due, Next Twelve Months | $ 436,017 |
Operating Leases, Future Minimum Payments, Due in Two Years | 113,516 |
Operating Leases, Future Minimum Payments Due | $ 549,533 |
Stockholders' Equity - Authoriz
Stockholders' Equity - Authorized Shares (Details Textual) - $ / shares | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Stockholders' Equity [Abstract] | |||
Common stock, shares authorized (shares) | 200,000,000 | 200,000,000 | 200,000,000 |
Series A Preferred stock, shares authorized (shares) | 10,000,000 | 10,000,000 | 10,000,000 |
Series A Preferred stock, par value (per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Stockholders' Equity - Reverse
Stockholders' Equity - Reverse Stock Split (Details Textual) | Jan. 06, 2016 |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stockholders' Equity, Reverse Stock Split | ratio of one share for every 20 shares outstanding prior to the effective date of the reverse stock split. All current and historical information contained herein related to the share and per share information for the Company's common stock or stock equivalents reflects the 1-for-20 reverse stock split of the Company's outstanding shares of common stock that became market effective on January 11, 2016. There was no change in the number of the Company's authorized shares of common stock. |
Stockholders' Equity - Stock Is
Stockholders' Equity - Stock Issued for Acquisitions (Details) - USD ($) | Jan. 30, 2017 | Jul. 31, 2016 | Jan. 30, 2016 | Jul. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |||
Ebyline, Inc. [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock issued for payment of acquisition liability (shares) | 200,542 | 114,398 | ||||||||
Business combination, consideration transferred, equity interests issued and issuable | $ 848,832 | $ 250,000 | ||||||||
Business combination, consideration transferred, liabilities incurred, installment payments | $ 938,532 | 938,532 | ||||||||
Common Stock [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock issued for payment of acquisition liability (shares) | 200,542 | 200,605 | 31,821 | |||||||
Remaining Present and Fair Value [Member] | Ebyline, Inc. [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Acquisition costs payable by Ebyline shareholders | $ 89,700 | $ 0 | [1] | $ 0 | [1] | $ 89,700 | [1] | |||
Remaining Present and Fair Value [Member] | ZenContent [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Business combination, consideration transferred, equity interests issued and issuable | $ 0 | $ 0 | [2] | |||||||
Estimated Gross Purchase Consideration [Member] | ZenContent [Member] | ||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||
Stock issued for payment of acquisition liability (shares) | 86,207 | |||||||||
Business combination, consideration transferred, equity interests issued and issuable | $ 600,000 | |||||||||
[1] | According to the Ebyline Stock Purchase Agreement, $89,700 in closing related expenses paid by Ebyline during the acquisition process were payable by the selling shareholders. These costs were deducted from the guaranteed payment on January 30, 2016. | |||||||||
[2] | The aggregate consideration paid at closing for the acquisition of ZenContent consisted of a cash payment of $400,000 and the issuance of 86,207 shares of IZEA common stock valued at $600,000. |
Stockholders' Equity - Stock 64
Stockholders' Equity - Stock issued for Services (Details) | Nov. 09, 2017shares | Aug. 14, 2017USD ($)shares | Feb. 12, 2017USD ($)shares | May 16, 2016USD ($)shares | Apr. 11, 2016USD ($)shares | Dec. 29, 2015shares | Aug. 17, 2015shares | Apr. 30, 2015shares | Mar. 31, 2016USD ($)shares | Dec. 31, 2017USD ($)shares | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($)shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Number of independent directors | 5 | 5 | 5 | |||||||||
Stock issued for payment of services | $ 155,000 | $ 129,794 | $ 125,992 | |||||||||
Number of directors | 5 | |||||||||||
Number of shares vested per month | shares | 362 | |||||||||||
Number of contest winners (employees) | 4 | |||||||||||
Derivative, gain on derivative (dollars) | $ 39,269 | $ 4,103 | ||||||||||
Amount shares remaining to vest | shares | 11,799 | |||||||||||
Fair value of common stock issued for future services (dollars) | $ 53,331 | 0 | $ 0 | |||||||||
Remaining vesting period of future compensation expense | 47 months | |||||||||||
Employee Stock Awards [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock issued for payment of services (shares) | shares | 1,364 | 1,250 | ||||||||||
Stock issued for payment of services | $ 18,700 | |||||||||||
Consideration for Service as Directors [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock issued for payment of services (shares) | shares | 13,767 | |||||||||||
Stock issued for payment of services | $ 107,292 | |||||||||||
Consideration for Loan [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock issued for payment of services (shares) | shares | 84,375 | |||||||||||
Restricted Stock [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock issued for payment of services (shares) | shares | 749 | |||||||||||
Adjustments to additional paid in capital, share-based compensation, requisite service period recognition (in dollars) | $ 181,995 | $ 133,897 | $ 125,992 | |||||||||
Contractor [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock issued for payment of services (shares) | shares | 7,109 | |||||||||||
Stock issued for payment of services | $ 30,000 | |||||||||||
Five Directors [Member] | Restricted Stock [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock issued for payment of services (shares) | shares | 3,261 | 811 | 41,770 | 20,360 | ||||||||
Stock issued for payment of services | $ 18,750 | $ 6,250 | $ 125,000 | $ 125,000 | ||||||||
Chief Executive Officer [Member] | Restricted Stock [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock issued for payment of services (shares) | shares | 7,543 | 2,812 | ||||||||||
Stock issued for payment of services | $ 36,411 | |||||||||||
Stock issued during period, vesting period | 48 months | |||||||||||
Chief Operating Officer [Member] | Restricted Stock [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock issued for payment of services (shares) | shares | 1,257 | 662 | ||||||||||
Stock issued for payment of services | $ 6,446 | |||||||||||
Stock issued during period, vesting period | 48 months | |||||||||||
Contest Award [Member] | Five Directors [Member] | Restricted Stock [Member] | ||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||
Stock issued for payment of services | $ 4,794 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Non-Vested Restricted Stock (Details) - Restricted Stock [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 0 | 0 | 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 61,153 | 21,109 | 16,381 |
Share-based compensation arrangement by share-based payment award, equity instruments other than options, vested in period | (49,354) | (21,109) | (16,381) |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period | 0 | 0 | 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 11,799 | 0 | 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ 0 | $ 0 | $ 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | 3.24 | 6.15 | 7.60 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value | 3.72 | 6.34 | 7.60 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value | 0 | 0 | 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ 4.52 | $ 0 | $ 0 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Outstanding, Weighted Average Remaining Contractual Terms | 3 years 10 months |
Stockholders' Equity - Warrant
Stockholders' Equity - Warrant Transactions (Details) - USD ($) | Aug. 14, 2017 | Jan. 22, 2015 | Jun. 30, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Aug. 14, 2015 | Jul. 20, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Fair value adjustment of warrants | $ 7,178,035 | |||||||
Loss on exchange of warrants | $ 0 | $ 0 | (1,845,810) | |||||
Fair value of warrants issued | 0 | 0 | 51,950 | |||||
Class of Warrant or Right, Number of Securities Called by Each Warrant or Right | 5,000 | 12,500 | ||||||
Class of warrant or right, exercise price of warrants or rights | $ 10.20 | $ 10.20 | ||||||
Investment Warrants Expiration Date | Jan. 22, 2020 | Jun. 30, 2020 | ||||||
Warrants and rights outstanding | $ (7,700) | $ (44,250) | ||||||
Proceeds from issuance of warrants | $ 100 | |||||||
2014 Warrants [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Class of warrants or rights discount on warrant exercise price | 26.00% | |||||||
2013 Warrants [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Class of warrants or rights discount on warrant exercise price | 25.00% | |||||||
2013 and 2014 Warrants [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Percentage of warrants held by investors to participate in warrant exercise offer | 70.00% | |||||||
Stock options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Adjustments to additional paid in capital, share-based compensation, requisite service period recognition (in dollars) | 635,427 | 748,092 | 705,466 | |||||
General and Administrative Expense [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Adjustments to additional paid in capital, share-based compensation, requisite service period recognition (in dollars) | 7,600 | |||||||
General and Administrative Expense [Member] | Stock options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Adjustments to additional paid in capital, share-based compensation, requisite service period recognition (in dollars) | 573,338 | 658,509 | 657,387 | |||||
Cost of revenue [Member] | Stock options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Adjustments to additional paid in capital, share-based compensation, requisite service period recognition (in dollars) | $ 13,381 | $ 18,903 | 14,534 | |||||
2013 and 2014 Warrants [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Loss on exchange of warrants | (1,845,810) | |||||||
Class of warrant or right, exercise price of warrants or rights | $ 5.87 | |||||||
Proceeds from issuance of warrants | $ 12,861,057 | |||||||
Series A 2013 Warrants [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Class of warrant or right, exercise price of warrants or rights | 5 | |||||||
Series A 2014 Warrants [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Class of warrant or right, exercise price of warrants or rights | 7 | |||||||
Series B 2013 Warrants [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Class of warrant or right, exercise price of warrants or rights | 10 | |||||||
Series B 2014 Warrants [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Class of warrant or right, exercise price of warrants or rights | $ 10 | |||||||
2014 Warrants [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Loss on exchange of warrants | (1,197,821) | |||||||
Fair value of warrants issued | 5,348,408 | |||||||
Class of warrant or right, number of securities called by warrants or rights | (1,392,832) | |||||||
Warrants and rights outstanding | $ (1,181,638) | |||||||
Class of warrant or right, outstanding | (396,536) | |||||||
Class of warrants or rights discount on warrant exercise price | 26.00% | |||||||
Proceeds from issuance of warrants | 8,760,805 | |||||||
2013 Warrants [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Fair value adjustment of warrants | 647,989 | |||||||
Loss on exchange of warrants | $ (647,989) | |||||||
Class of warrant or right, number of securities called by warrants or rights | (798,715) | |||||||
Class of warrants or rights discount on warrant exercise price | 25.00% | |||||||
Proceeds from issuance of warrants | $ 4,100,252 | |||||||
Common Stock [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Warrants exercised during the period, shares | 2,191,547 |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Options (Details Textual) - USD ($) | Aug. 22, 2011 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 21, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 0 | 0 | 0 | ||
Fair value of common stock | $ 4.52 | ||||
Percentage of individual ownership of common stock (percentage) | 10.00% | ||||
Share-based compensation arrangement by share-based payment award, options, outstanding, intrinsic value | $ 159,671 | ||||
Share-based compensation arrangement by share-based payment award, options, exercisable, intrinsic value | $ 20,102 | ||||
Equity Incentive 2011 Plan [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 0 | 0 | 0 | ||
Common stock, capital shares reserved for future issuance (shares) | 382,523 | 500,000 | |||
Weighted average exercise price, exercisable | $ 6.24 | ||||
Equity Incentive B 2011 Plan [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock, capital shares reserved for future issuance (shares) | 4,375 | 1,875 | |||
May 2011 and August 2011 Equity Incentive Plans [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Fair market value of incentive stock options (percentage) | 100.00% | ||||
Stock option vesting period from grant date | 10 years | ||||
Employee Stock Option [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Adjustments to additional paid in capital, share-based compensation, requisite service period recognition (in dollars) | $ 635,427 | $ 748,092 | $ 705,466 | ||
Employee service share-based compensation, nonvested awards, compensation cost not yet recognized | $ 744,647 | ||||
Employee service share-based compensation, nonvested awards, compensation cost not yet recognized, period for recognition (in years) | 2 years 6 months | ||||
Investor Relations Services [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock, capital shares reserved for future issuance (shares) | 1,500,000 | ||||
Individual Stock Ownership in Excess of 10 Percent [Member] | May 2011 and August 2011 Equity Incentive Plans [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Fair market value of incentive stock options (percentage) | 110.00% | ||||
Twelve Months After Grant Date [Member] | May 2011 and August 2011 Equity Incentive Plans [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock option vesting period from grant date | 1 year | ||||
Share-based compensation arrangement by share-based payment award, equity instruments options, percentage vested (pecentage) | 25.00% | ||||
Monthly in equal installments [Member] | Employee Stock Option [Member] | May 2011 and August 2011 Equity Incentive Plans [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Share-based compensation arrangement by share-based payment award, award vesting period (in years) | 3 years | ||||
Selling and Marketing Expense [Member] | Employee Stock Option [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Adjustments to additional paid in capital, share-based compensation, requisite service period recognition (in dollars) | $ 48,708 | 70,680 | 33,545 | ||
General and Administrative Expense [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Adjustments to additional paid in capital, share-based compensation, requisite service period recognition (in dollars) | 7,600 | ||||
General and Administrative Expense [Member] | Employee Stock Option [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Adjustments to additional paid in capital, share-based compensation, requisite service period recognition (in dollars) | 573,338 | 658,509 | 657,387 | ||
Cost of revenue [Member] | Employee Stock Option [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Adjustments to additional paid in capital, share-based compensation, requisite service period recognition (in dollars) | $ 13,381 | $ 18,903 | $ 14,534 |
Stockholders' Equity - Schedu68
Stockholders' Equity - Schedule of Options Outstanding (Details) - $ / shares | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 0 | 0 | 0 | ||
Equity Incentive 2011 Plan [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||||
Common shares, outstanding beginning of period | 959,864 | 830,599 | 595,786 | ||
Common shares, granted | 141,246 | 179,998 | 277,059 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 0 | 0 | 0 | ||
Common shares, forfeited | (51,607) | (50,733) | (42,246) | ||
Common shares, outstanding end of period | 1,049,503 | 959,864 | 830,599 | 595,786 | |
Share-based compensation arrangement by share-based payment award, options, exercisable, number | 726,426 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | |||||
Weighted average exercise price, beginning of period | $ 8.11 | $ 8.65 | $ 9.20 | ||
Weighted average exercise price, granted | 3.49 | 6.16 | 7.43 | ||
Weighted average exercise price, exercised | 0 | 0 | 0 | ||
Weighted average exercise price, forfeited | 38.86 | 10.15 | 7.70 | ||
Weighted average exercise price, end of period | $ 8.11 | $ 8.65 | $ 9.20 | $ 9.20 | $ 5.97 |
Weighted average exercise price, exercisable | $ 6.24 | ||||
Weighted average remaining life (years), outstanding | 6 years | 6 years 5 months | 6 years 9 months | 6 years 6 months | |
Weighted average remaining life (years), exercisable | 4 years 11 months |
Stockholders' Equity - Schedu69
Stockholders' Equity - Schedule of Nonvested Stock Option (Details) - Equity Incentive 2011 Plan [Member] - $ / shares | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares [Roll Forward] | ||||
Common shares, nonvested beginning of period | 414,306 | 461,926 | 372,092 | |
Common shares, granted | 141,246 | 179,998 | 277,059 | |
Common shares, vested | (205,469) | (187,181) | (147,759) | |
Common shares, forfeited | (27,006) | (40,437) | (39,466) | |
Common shares, nonvested end of period | 323,077 | 414,306 | 461,926 | 372,092 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | ||||
Weighted average grant date fair value, nonvested beginning of period | $ 3.60 | $ 3.84 | $ 4 | |
Weighted average grant date fair value, granted | 1.76 | 2.88 | 3.84 | |
Weighted average grant date fair value, vested | 3.36 | 4 | 4.32 | |
Weighted average grant date fair value, forfeited | 3.12 | 3.76 | 3.44 | |
Weighted average grant date fair value, nonvested end of period | $ 2.64 | $ 3.60 | $ 3.84 | $ 4 |
Weighted average remaining years to vest | 2 years 8 months | 2 years 7 months | 2 years 9 months | 3 years |
Stockholders' Equity - Employee
Stockholders' Equity - Employee Stock Purchase Plan (Details Textual) - 2014 Employee Stock Purchase Plan [Member] | Apr. 16, 2014USD ($)shares | Dec. 31, 2017USD ($)shares | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($)shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Common stock, capital shares reserved for future issuance (shares) | 75,000 | 33,594 | ||
Share-based compensation arrangement by share-based payment award, award vesting period (in days) | 90 days | |||
Minimum hour requirement for employees participation in the ESSP (hours) | 20 | |||
Employee stock ownership plan (ESOP), successive offering period | 6 months | |||
Annual compensation limit percentage, employee stock purchase plan (percentage) | 10.00% | |||
Annual compensation limit, employee stock purchase plan (dollars) | $ | $ 21,250 | |||
Shares issuance limit per offering period, employee stock purchase plan | 1,000 | |||
Fair market value of shares available for issuance (percentage) | 85.00% | |||
Stock issued during period, value, employee stock ownership plan | $ | $ 26,249 | $ 58,021 | $ 76,170 | |
Stock issued during period, shares, employee stock ownership plan | 16,168 | 11,453 | 13,403 |
Earnings (Loss) Per Common Sh71
Earnings (Loss) Per Common Share (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |||
Net loss | $ (5,467,699) | $ (7,560,200) | $ (11,308,171) |
Weighted average common shares outstanding – basic and diluted | 5,674,901 | 5,380,465 | 3,737,897 |
Basic and diluted loss per common share | $ (0.96) | $ (1.41) | $ (3.03) |
Earnings (Loss) Per Common Sh72
Earnings (Loss) Per Common Share (Details 1) - shares | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share | 1,522,121 | 1,441,317 | 2,655,856 |
Stock options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share | 990,152 | 889,450 | 723,834 |
Warrants | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share | 531,969 | 551,867 | 1,873,547 |
Restricted stock units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of earnings per share | 0 | 0 | 58,475 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | Aug. 14, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Related Party Transaction [Line Items] | ||||
Proceeds from Warrant Exercises | $ 0 | $ 0 | $ 12,861,157 | |
Special Situations Fund [Member] | Warrant Exchange [Member] | ||||
Related Party Transaction [Line Items] | ||||
Proceeds from Warrant Exercises | $ 3,414,572 | |||
Class of warrant or right, number of securities called by warrants or rights | (542,858) | |||
Director [Member] | Warrant Exchange [Member] | ||||
Related Party Transaction [Line Items] | ||||
Proceeds from Warrant Exercises | $ 2,460,208 | |||
Class of warrant or right, number of securities called by warrants or rights | (502,940) | |||
Mr. Murphy [Member] | Warrant Exchange [Member] | ||||
Related Party Transaction [Line Items] | ||||
Proceeds from Warrant Exercises | $ 2,741 | |||
Class of warrant or right, number of securities called by warrants or rights | (179,715) | |||
Mr. Gardner [Member] | Warrant Exchange [Member] | ||||
Related Party Transaction [Line Items] | ||||
Proceeds from Warrant Exercises | $ 436 | |||
Class of warrant or right, number of securities called by warrants or rights | (28,572) |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | |||
Net operating loss carry forwards | $ 19,362,000 | $ 17,875,000 | $ 15,649,000 |
Change in federal tax rate | (6,329,000) | 0 | 0 |
Accrued expenses | 270,000 | 256,000 | 187,000 |
Stock option and warrant expenses | 698,000 | 804,000 | 618,000 |
Accounts receivable | 67,000 | 90,000 | 52,000 |
Deferred rent | 24,000 | 36,000 | 44,000 |
Other | 1,000 | 3,000 | 3,000 |
Total deferred tax assets | 14,093,000 | 19,064,000 | 16,553,000 |
Valuation allowance | (13,860,000) | (18,475,000) | (15,871,000) |
Net deferred tax assets | 233,000 | 589,000 | 682,000 |
Deferred tax liabilities: | |||
Fixed and tangible assets | (233,000) | (589,000) | (682,000) |
Total deferred tax liabilities | (233,000) | (589,000) | (682,000) |
Total deferred tax assets (liabilities) | $ 0 | $ 0 | $ 0 |
Income Taxes (Details 1)
Income Taxes (Details 1) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Federal income tax at statutory rates | (34.00%) | (34.00%) | (34.00%) |
Change in deferred tax asset valuation allowance | (81.70%) | 39.00% | 28.80% |
Deferred state taxes | (3.30%) | (3.20%) | (2.50%) |
Non-deductible expenses: | |||
Change in value of acquisition liability | 3.70% | 0.00% | 0.00% |
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Change in Fair Value of Warrants, Percent | 0.00% | 0.00% | 0.00% |
ISO stock compensation | 1.60% | 1.30% | 0.70% |
Change in state & federal deferred rate | 112.10% | (4.20%) | 0.00% |
Other | 1.60% | 1.10% | 0.60% |
Income taxes (benefit) at effective rates | 0.00% | 0.00% | 0.00% |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Examination [Line Items] | |||
Operating loss carryforwards | $ 50,177,102 | ||
Effective income tax rate reconciliation, change in enacted tax rate, percent (percentage) | 21.00% | ||
Effective income tax rate reconciliation, change in deferred tax assets, amount | $ 6,300,000 | ||
Tax act impact on deferred tax assets and liabilities | $ 0 | $ 0 | |
Effective income tax rate reconciliation, prior year income taxes, percent (percentage) | 34.00% | ||
Effective income tax rate reconciliation, change in deferred tax assets valuation allowance, amount | $ 6,300,000 | ||
Minimum [Member] | |||
Income Tax Examination [Line Items] | |||
Year net operating carryforwards expires (year) | 2,026 | ||
Maximum [Member] | |||
Income Tax Examination [Line Items] | |||
Year net operating carryforwards expires (year) | 2,037 | ||
Ebyline, Inc. [Member] | |||
Income Tax Examination [Line Items] | |||
Effective income tax rate reconciliation, change in deferred tax assets valuation allowance, amount | $ (4,615,000) | $ 2,604,000 | $ 4,648,000 |
Unaudited Quarterly Financial77
Unaudited Quarterly Financial Data (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||||||
Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||||
Revenue | $ 24,437,649 | |||||||||||||
Cost of revenue (exclusive of amortization) | 11,585,316 | |||||||||||||
Sales and marketing | 7,593,197 | |||||||||||||
General and administrative | 9,218,565 | |||||||||||||
Depreciation and amortization | 1,516,807 | |||||||||||||
Total costs and expenses | 29,913,885 | |||||||||||||
Loss from operations | (5,476,236) | |||||||||||||
Interest expense | (64,950) | |||||||||||||
Loss on exchange of warrants | 0 | $ 0 | $ (1,845,810) | |||||||||||
Change in fair value of derivatives, net | 39,269 | |||||||||||||
Other income (expense), net | 34,218 | |||||||||||||
Total other income (expense), net | 8,537 | |||||||||||||
Net loss | $ (5,467,699) | $ (7,560,200) | $ (11,308,171) | |||||||||||
Weighted average common shares outstanding – basic and diluted | 5,674,901 | 5,380,465 | 3,737,897 | |||||||||||
Basic and diluted loss per common share | $ (0.96) | $ (1.41) | $ (3.03) | |||||||||||
Workflow Revenue Adjustment [Member] | ||||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||||
Revenue | $ (1,064,819) | $ (1,267,317) | $ (1,368,001) | $ (1,550,377) | $ (1,463,042) | $ (1,480,064) | $ (1,582,822) | $ (1,734,392) | $ (1,722,518) | $ (1,750,026) | $ (1,151,305) | $ (6,076,305) | $ (6,358,241) | |
Cost of revenue (exclusive of amortization) | (1,064,819) | (1,267,317) | (1,368,001) | (1,550,377) | (1,463,042) | (1,480,064) | (1,582,822) | (1,734,392) | (1,722,518) | (1,750,026) | (1,151,305) | (6,076,305) | (6,358,241) | |
Total costs and expenses | (1,064,819) | (1,267,317) | (1,368,001) | (1,550,377) | (1,463,042) | (1,480,064) | (1,582,822) | (1,734,392) | (1,722,518) | (1,750,026) | (1,151,305) | (6,076,305) | (6,358,241) | |
Loss from operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Total other income (expense), net | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Net loss | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Campaign Fulfillment Adjustment [Member] | ||||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||||
Revenue | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Cost of revenue (exclusive of amortization) | 608,824 | 539,835 | 509,535 | 643,460 | 595,877 | 586,546 | 482,947 | 489,381 | 475,392 | 414,398 | 340,691 | 2,308,830 | 1,719,862 | |
Sales and marketing | (608,824) | (539,835) | (509,535) | (643,460) | (595,877) | (571,696) | (461,287) | (468,981) | (452,792) | (397,398) | (330,691) | (2,272,320) | (1,649,862) | |
General and administrative | 0 | 0 | 0 | 0 | 0 | (14,850) | (21,660) | (20,400) | (22,600) | (17,000) | (10,000) | (36,510) | (70,000) | |
Depreciation and amortization | 0 | 0 | ||||||||||||
Total costs and expenses | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Loss from operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Total other income (expense), net | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Net loss | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Depreciation and Amortization Reclassification [Member] | ||||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||||
Revenue | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||
Cost of revenue (exclusive of amortization) | 0 | |||||||||||||
Sales and marketing | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |||
General and administrative | (374,965) | (358,260) | (362,606) | (364,788) | (339,589) | (299,177) | (296,297) | (428,071) | (230,553) | (226,211) | (174,296) | (1,299,851) | (1,059,131) | |
Depreciation and amortization | 374,965 | 358,260 | 362,606 | 364,788 | 339,589 | 299,177 | 296,297 | 428,071 | 230,553 | 226,211 | 174,296 | 1,299,851 | 1,059,131 | |
Total costs and expenses | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Loss from operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Total other income (expense), net | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Net loss | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Scenario, Previously Reported [Member] | ||||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||||
Revenue | 8,154,674 | 6,980,221 | 6,202,506 | 7,433,991 | 7,496,972 | 6,913,689 | 5,465,950 | 6,262,233 | 5,442,457 | 4,627,742 | 4,135,494 | 27,310,602 | 20,467,926 | |
Cost of revenue (exclusive of amortization) | 3,758,621 | 3,442,181 | 3,195,526 | 3,795,209 | 3,927,279 | 3,418,387 | 3,101,369 | 3,587,608 | 3,290,457 | 2,917,360 | 2,441,491 | 14,242,244 | 12,236,916 | |
Sales and marketing | 2,342,002 | 2,426,363 | 2,898,355 | 2,705,246 | 2,584,287 | 2,612,714 | 2,359,663 | 2,626,091 | 1,982,088 | 1,746,549 | 1,581,487 | 10,261,910 | 7,936,215 | |
General and administrative | 2,687,266 | 2,524,630 | 2,809,524 | 2,723,490 | 2,454,555 | 2,524,746 | 2,580,001 | 2,435,748 | 1,056,473 | 2,164,380 | 1,860,514 | 10,282,792 | 7,517,115 | |
Depreciation and amortization | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
Total costs and expenses | 8,787,889 | 8,393,174 | 8,903,405 | 9,223,945 | 8,966,121 | 8,555,847 | 8,041,033 | 8,649,447 | 6,329,018 | 6,828,289 | 5,883,492 | 34,786,946 | 27,690,246 | |
Loss from operations | (633,215) | (1,412,953) | (2,700,899) | (1,789,954) | (1,469,149) | (1,642,158) | (2,575,083) | (2,387,214) | (886,561) | (2,200,547) | (1,747,998) | (7,476,344) | (7,222,320) | |
Interest expense | (15,058) | (13,272) | (17,076) | (24,683) | (25,511) | (11,411) | (21,339) | (29,507) | (31,191) | (36,393) | (18,770) | (82,944) | (115,861) | |
Loss on exchange of warrants | 0 | (1,845,810) | 0 | 0 | (1,845,810) | |||||||||
Change in fair value of derivatives, net | 45,160 | (8,420) | (618) | (5,405) | (14,705) | 26,421 | 2,852 | 5,720 | 115,904 | 250,507 | (2,505,951) | 9,163 | (2,133,820) | |
Other income (expense), net | 44,308 | (11,953) | (627) | (9,590) | (2,238) | 803 | 950 | 4,120 | 2,571 | 1,142 | 1,807 | (10,075) | 9,640 | |
Total other income (expense), net | 74,410 | (33,645) | (18,321) | (39,678) | (42,454) | 15,813 | (17,537) | (19,667) | (1,758,526) | 215,256 | (2,522,914) | (83,856) | (4,085,851) | |
Net loss | $ (558,805) | $ (1,446,598) | $ (2,719,220) | $ (1,829,632) | $ (1,511,603) | $ (1,626,345) | $ (2,592,620) | $ (2,406,881) | $ (2,645,087) | $ (1,985,291) | $ (4,270,912) | $ (7,560,200) | $ (11,308,171) | |
Weighted average common shares outstanding – basic and diluted | 5,702,297 | 5,676,629 | 5,598,200 | 5,450,005 | 5,420,020 | 5,350,128 | 5,300,520 | 5,118,139 | 4,075,605 | 2,885,721 | 2,884,883 | 5,380,465 | 3,737,897 | |
Basic and diluted loss per common share | $ (0.10) | $ (0.25) | $ (0.49) | $ (0.34) | $ (0.28) | $ (0.30) | $ (0.49) | $ (0.47) | $ (0.65) | $ (0.69) | $ (1.48) | $ (1.41) | $ (3.03) | |
Restatement Adjustment [Member] | ||||||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | ||||||||||||||
Revenue | $ 7,089,855 | $ 5,712,904 | $ 4,834,505 | $ 5,883,614 | $ 6,033,930 | $ 5,433,625 | $ 3,883,128 | $ 4,527,841 | $ 3,719,939 | $ 2,877,716 | $ 2,984,189 | $ 21,234,297 | $ 14,109,685 | |
Cost of revenue (exclusive of amortization) | 3,302,626 | 2,714,699 | 2,337,060 | 2,888,292 | 3,060,114 | 2,524,869 | 2,001,494 | 2,342,597 | 2,043,331 | 1,581,732 | 1,630,877 | 10,474,769 | 7,598,537 | |
Sales and marketing | 1,733,178 | 1,886,528 | 2,388,820 | 2,061,786 | 1,988,410 | 2,041,018 | 1,898,376 | 2,157,110 | 1,529,296 | 1,349,151 | 1,250,796 | 7,989,590 | 6,286,353 | |
General and administrative | 2,312,301 | 2,166,370 | 2,446,918 | 2,358,702 | 2,114,966 | 2,210,719 | 2,262,044 | 1,987,277 | 803,320 | 1,921,169 | 1,676,218 | 8,946,431 | 6,387,984 | |
Depreciation and amortization | 374,965 | 358,260 | 362,606 | 364,788 | 339,589 | 299,177 | 296,297 | 428,071 | 230,553 | 226,211 | 174,296 | 1,299,851 | 1,059,131 | |
Total costs and expenses | 7,723,070 | 7,125,857 | 7,535,404 | 7,673,568 | 7,503,079 | 7,075,783 | 6,458,211 | 6,915,055 | 4,606,500 | 5,078,263 | 4,732,187 | 28,710,641 | 21,332,005 | |
Loss from operations | (633,215) | (1,412,953) | (2,700,899) | (1,789,954) | (1,469,149) | (1,642,158) | (2,575,083) | (2,387,214) | (886,561) | (2,200,547) | (1,747,998) | (7,476,344) | (7,222,320) | |
Interest expense | (15,058) | (13,272) | (17,076) | (24,683) | (25,511) | (11,411) | (21,339) | (29,507) | (31,191) | (36,393) | (18,770) | (82,944) | (115,861) | |
Loss on exchange of warrants | 0 | (1,845,810) | 0 | 0 | 0 | (1,845,810) | ||||||||
Change in fair value of derivatives, net | 45,160 | (8,420) | (618) | (5,405) | (14,705) | 26,421 | 2,852 | 5,720 | 115,904 | 250,507 | (2,505,951) | 9,163 | (2,133,820) | |
Other income (expense), net | 44,308 | (11,953) | (627) | (9,590) | (2,238) | 803 | 950 | 4,120 | 2,571 | 1,142 | 1,807 | (10,075) | 9,640 | |
Total other income (expense), net | 74,410 | (33,645) | (18,321) | (39,678) | (42,454) | 15,813 | (17,537) | (19,667) | (1,758,526) | 215,256 | (2,522,914) | (83,856) | (4,085,851) | |
Net loss | $ (558,805) | $ (1,446,598) | $ (2,719,220) | $ (1,829,632) | $ (1,511,603) | $ (1,626,345) | $ (2,592,620) | $ (2,406,881) | $ (2,645,087) | $ (1,985,291) | $ (4,270,912) | $ (7,560,200) | $ (11,308,171) | |
Weighted average common shares outstanding – basic and diluted | 5,702,297 | 5,676,629 | 5,598,200 | 5,450,005 | 5,420,020 | 5,350,128 | 5,300,520 | 5,118,139 | 4,075,605 | 2,885,721 | 2,884,883 | 5,380,465 | 3,737,897 | |
Basic and diluted loss per common share | $ (0.10) | $ (0.25) | $ (0.49) | $ (0.34) | $ (0.28) | $ (0.30) | $ (0.49) | $ (0.47) | $ (0.65) | $ (0.69) | $ (1.48) | $ (1.41) | $ (3.03) |